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83 of 88 people found the following review helpful:
5.0 out of 5 stars
prophetic and painful, January 19, 2009
This review is from: Game Over: How You Can Prosper in a Shattered Economy (Hardcover)
The Game Leeb writes about is whether or not alternative energy systems can be developed before there is painful economic collapse. "Game Over" refers to a world where the easily extractable energy and mineral resources are gone (peak commodities) and we haven't developed the alternative technologies to maintain our society in the absence of low cost oil. Leeb outlines how energy and other resource limitations have come to dominate global economics. He explains the familiar concept of peak oil, and introduces the concept of absolute peak oil, the point where the energy cost of oil production just matches the energy extracted. Further Leeb goes on to describe how the extraction of minerals, water and even food are coupled to energy production. Leeb is concerned with the problems of building out of the most common alternative energy systems to a large scale.
Much of this book is recycled material found in Leeb's earlier work
The Oil Factor: Protect Yourself and Profit from the Coming Energy Crisis which made a more technical presentation of most of the economic ideas in the first few chapters. As in the The Coming Economic Collapse: How You Can Thrive When Oil Costs $200 a Barrel this book is written for a more general audience, but unlike his other books which are mainly directed at individual investors, the first three sections of Game Over are directed to the broader questions of how our complex and technological society can deal with resource limitations, which have been magnified by rapid economic development of Asia. Only the last section of the book is directed to investment choices for individuals.
One weak spot in the book is a chapter on the costs of complexity, which comes off as a bit of a political rant against the costs of having bad regulations and archaic ownership systems that make it difficult to move to solutions to the Energy supply problems. He might have added some material about how the demand for safety, adds to energy costs over time, as in pollution controls and automotive safety features making cars less efficient.
For a book emphasising alternatives to oil, Leeb says surprisingly little about global warming. He seems to underestimate the size of US coal reserves and so doesn't discuss the CO2 production problem. My suspicion is that when things get tough, concerns about our ecological commons will be swamped by immediate and local economic concerns. Another item almost entirely left out of the discussion is population control. In a world where change is driven by the billions in the third world expanding their consumption patterns, it seems Leeb is implying its already too late to do anything about overpopulation.
Leeb's investment advice has been fantastic. My interpretation of his oil price indicator was a market sell signal in late 2007. A big question right now is how long will the deflationary fears and trends last. This book's advice is based on the premise that the pain of deflation is so threatening to government revenues that inflation will be manufactured to keep the housing market from collapsing. His advice is premised on the view that the stimulation needed to solve the short term problems(thanks George) will flip us into a world of inflation that will make the 70's look like a cakewalk. Leeb paints a very nasty and depressing picture of our economic future. The rapid consumer growth in Asia has pushed up the Malthusian day of reckoning that much closer. Leeb's depressing picture may well prove prophetic unless we see some tremendously clever improvements in our industrial, land use, trade and energy policies combined with some timely technical advances in energy development.
Ignore Leeb's warnings at your own peril.
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53 of 55 people found the following review helpful:
5.0 out of 5 stars
This is the book I am giving my friends, March 1, 2009
This review is from: Game Over: How You Can Prosper in a Shattered Economy (Hardcover)
Over the past 5 years I've read well over a hundred books on peak oil, the state of the world's resources, and how the world's financial systems work. As I came to understand the staggering broader implications of our resource predicament, I began looking for a single book I could give to my friends that would provide a self-contained, straightforward explanation of our dilemma. Many of the earlier books are excellent, but some of those are also very technical, others engage in wishful thinking, and still others just didn't present the information in the way I would have wished for various reasons.
"Game Over" thoroughly explains the fundamental problems facing us while sparing the reader details about oil extraction technology and similar topics. For me, the fact that it is also an investment book is secondary, although many readers may also find that useful.
I am a geophysicist with long exposure to resource-related issues. As it happens, I started studying geophysics around the same time (1970) that US oil extraction (the common euphemism is "production," as if they're actually making the stuff) peaked, just as was predicted in a 1956 technical paper by a brilliant physicist/petroleum engineer who was ridiculed for many years for that prediction - until it happened. US extraction, once the highest in the world, has been declining for nearly 40 years since then. This irreversible decline came in spite of periods of vigorous exploration for new fields and impressive advances in exploration and extraction technology. Simply put: if it's not available, you can't have it.
In the 70s following the US peak, we speculated about what might happen when world oil extraction began to decline but it was all theoretical and far in the future and just an intriguing idea. Now the evidence strongly suggests that the world peak is at last near; there is some evidence we are there now, in spite of the recently crashing oil price. The US extraction decline only became obvious in retrospect and the same will be true for world decline.
I cannot overstate the importance of this issue. There are excellent reasons to believe that the peak in oil extraction will also mean the peak in food production, a frightening thought in a world with a huge and growing population, many already living with the specter of starvation. Also, the irreversible decline in the extraction of oil and other critical resources will likely bring an end to capitalism as we know it because a positive sum game will have become a negative sum game. Getting from that realization to a system that is sustainable on a finite and damaged world will be a very tough slog. "Game Over" provides the background to understand these things.
Leeb is well qualified to explain these issues; he has degrees in economics, mathematics, and psychology; he is rational, understands markets, and understands why people are psychologically resistant to acknowledging the approaching disaster let alone dealing with it, and he presents all of that clearly in this book. This is at least his third book in the series following "The Oil Factor," then "The Coming Economic Collapse." You can see a trend in the titles and the predictions he made in those earlier books have pretty much become reality.
I know there are a thousand disaster scenarios circulating through the blogosphere so it's easy to dismiss this as just one more. Before doing that, please look into it carefully. Remember the simple rule: if it's not available you can't have it.
One fact worth noting: discussion of this issue has reached the point where even most of the economists and oil company executives who ridiculed the whole idea of peak oil five years ago now admit it is real, so the argument now is more often about the shape of the peak and whether we've already reached it or not.
By the way, a great video of an easily understood explanation of how we got here by a physicist, Dr. Albert Bartlett, is available on the web at globalpublicmedia. If you're new to these concepts I urge you to gain strength through knowledge. View the video, read "Game Over" and you'll have a good understanding of the background and some thoughts about what can be done to prepare individually and as a society.
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42 of 44 people found the following review helpful:
5.0 out of 5 stars
Essential reading in turbulent times, January 22, 2009
This review is from: Game Over: How You Can Prosper in a Shattered Economy (Hardcover)
Stephen Leeb has a knack for boiling complex issues down in a concise, easy-to-understand manner for the layman. More importantly, he has an uncanny record of spotting major trends well ahead of the crowd. Investors who ignore Leeb's sage comments do so to the detriment of their wealth. The list of trends he has been out in front of over the years are numerous, but let me just touch on two of them.
A decade ago when oil prices were below $20 a barrel and inflation was less than 2 percent, Leeb had this to say about where oil and food prices were headed in his book Defying the Market:
Strong economic growth, particularly in developing countries, will create a tremendous appetite not just for energy buy for food as well, as populations move up the food chain and demand greater quantities of more protein-rich nourishment. Technological and natural limits will curtail our ability to expand the supply of food and process will rise. A variety of food-related companies will see both profits and share prices soar.
We all know what followed. Prior to the collapse in commodities in 2008 (as a result of the global financial crisis), oil prices were approaching $150 a barrel and the cost of food was going through the roof thanks in large part to strong demand from emerging economies like China and India. Oil stocks were big winners during the period and fertilizer stocks, like Mosaic and Potash of Saskatchewan, rose 15- to 20-fold while the Dow and S&P went essentially nowhere.
But Dr. Leeb's keen insights haven't stopped there. Here's a quote from his last book, The Coming Economic Collapse pertinent to where were find ourselves today:
With home prices, stock prices, and the economy all slumping, all feeding on one another, it would indeed be a vicious circle. Record levels of unemployment would likely. Could the policy-makers rescue such a situation? Clearly, it would be a far greater challenge than rescuing the economy in the wake of the tech bubble. It would take massive amounts of money. Interest rates would likely fall to zero. Government spending would need to reach unimaginably high levels. In other words, if the economy survived, it would emerge with much higher debt levels then before. Moreover, we would still face the same hideous inflationary problem, a shortage of energy, and the prospect of sharply rising oil prices.
Sound familiar? Keep in mind that this book was published four years ago, well before the housing crisis was front-page news. Today, short-term interest rates are at essentially zero and the government is throwing a $1 trillion at the economy in a Herculean effort to get the economy going again. Raging inflation hasn't taken hold yet, but it sure looks like that will be the next act. And I, for one, am investing accordingly.
If even the best-case scenario he outlines in his newest book comes to pass it will make the terrible 1970s look like a picnic for investors.
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