2008 was the year of the worst economic collapse since the Great Depression.  This collapse was the first one since the beginning of the new global economy and thus showed how humanity and all of its nation states are financially interconnected in a historically unprecedented way.  This global financial collapse is historically significant for several reasons.  First it did show that money and finance knows no national boundaries, and that nation states can no longer individually deal with major financial crises.  Second it is the start of the process to cleanse the global and particularly U.S economy from over leveraged, debt oriented mindless growth and consumption that has been a result of the mindless support of unlimited growth without thought of personal, national and global consequences.  Third it represents a clear albeit disruptive and painful part of the transition that humanity is now making from one age, the Information Age, to the new age, the Shift Age.

2008 was the year when people around the world, and most strikingly Americans, make a sudden and profound switch from consumption, debt and spending to, thrift, saving and shedding ...]]> The year 2008 will obviously go down as one of the most eventful years in recent history.  It was the year that Barack Obama was elected President of the United States.  It was the year that the Internet replaced print and TV as the driving force in a presidential election. It was the beginning of the end of 15 years of divisive cultural politics in America.

2008 was the year of the worst economic collapse since the Great Depression.  This collapse was the first one since the beginning of the new global economy and thus showed how humanity and all of its nation states are financially interconnected in a historically unprecedented way.  This global financial collapse is historically significant for several reasons.  First it did show that money and finance knows no national boundaries, and that nation states can no longer individually deal with major financial crises.  Second it is the start of the process to cleanse the global and particularly U.S economy from over leveraged, debt oriented mindless growth and consumption that has been a result of the mindless support of unlimited growth without thought of personal, national and global consequences.  Third it represents a clear albeit disruptive and painful part of the transition that humanity is now making from one age, the Information Age, to the new age, the Shift Age.

2008 was the year when people around the world, and most strikingly Americans, make a sudden and profound switch from consumption, debt and spending to, thrift, saving and shedding of debt whenever possible.  As written here months ago, “Thrift is the new hip, thrift is the new extravagance”,  It is and will be cool to shop at resale stores, drive cars years longer, save money, and in general to embrace the thrift lifestyle.  This trend, along with the collapse in the price of oil has ushered in a time of both economic contraction and monetary deflation.  Think about it, what costs more today than it did a year ago?  Not much.

2008 was, in the first half the seeming beginning of peak oil and in the second half a realization that this peak situation, while still real, will be drawn out a few years longer than was thought as recently as 2-3 years ago.  Oil, and gasoline will go up from its current price in 2009, but not enough to shock the system, just enough in underscore to the consumer the need to be thrifty elsewhere in their spending.

2008 was the year when it seemed that the critical mass thinking about global warming that occurred in 2006 reached a level of massive acceptance.  The age old exercise about talking about the weather took on new meaning this year.  If we all had the sensitivity to the earth that the Native Americans had centuries ago we would be hearing the earth and the spirits of the planet telling us clearly that all is not well.

This is the last column of this incredibly eventful year.  I deeply thank all of you who have been loyal readers of www.evolutionshift.com during its almost three years in existence.  Your support and comments over this time period has meant a lot to me.  Thank you.  I also acknowledge all of the new readers who have come to this site during 2008.  The readership has grown significantly this past year, both in the U.S. and around the world.  It makes no difference whether you came here because of hearing me speak, a recommendation from a friend or favorite blog, or just because in this time of upheaval you wanted something to read that might provoke clarity about what might seem like an uncertain future.  You are here, I thank you for that, and will strive to give you thought provoking columns in 2009.

The next couple of columns, in the New Year, will be my annual forecasts for the year.  2009 will not be a respite from the turbulence of 2008, it will be a continuation, an expansion and the beginning of the new directions that humanity is going to take in the years ahead.  Our journey together is changing course.  Happy New Year!

The bookends for these 12 years of explosive financial growth are the Atlanta Olympics in 1996 and the Beijing Olympics of 2008.  The Atlanta Olympics were the first post-cold war Olympics and, being held in the U.S. created a huge marketing platform.  The Beijing Olympics was the coming out party for the most populous country in the world and gave  recognition to China as a major player on the world’s geopolitical and financial stages.

In 1996 cable television had become a dominant media force in the U.S.  ESPN, and all of its networks, was beginning to take its’ place as the behemoth of sports television.  Regional sports networks, TBS and TNT soon joined the party and it seemed that sports were everywhere on TV.  The broadcast networks and all of these cable entities competed for the rights of all major sports.  The fees paid to the NFL, MLB, the NBA, and the college football conferences exploded.  This led to dramatically increased player salaries, advertising rates and, for the consumer, rapidly increasing cable bills.  Of course it also led to much lower ratings as nothing was special any more.  Even though Monday Night Football on ...]]> We are coming to an end of the greatest financial age of sports in history.  The twelve years between 1996 and 2008 were years when the money around sports exploded beyond any precedent era.  This also means that, going forward, the economics around sports in general will decline, at least for the next 5-8 years if not longer.

The bookends for these 12 years of explosive financial growth are the Atlanta Olympics in 1996 and the Beijing Olympics of 2008.  The Atlanta Olympics were the first post-cold war Olympics and, being held in the U.S. created a huge marketing platform.  The Beijing Olympics was the coming out party for the most populous country in the world and gave  recognition to China as a major player on the world’s geopolitical and financial stages.

In 1996 cable television had become a dominant media force in the U.S.  ESPN, and all of its networks, was beginning to take its’ place as the behemoth of sports television.  Regional sports networks, TBS and TNT soon joined the party and it seemed that sports were everywhere on TV.  The broadcast networks and all of these cable entities competed for the rights of all major sports.  The fees paid to the NFL, MLB, the NBA, and the college football conferences exploded.  This led to dramatically increased player salaries, advertising rates and, for the consumer, rapidly increasing cable bills.  Of course it also led to much lower ratings as nothing was special any more.  Even though Monday Night Football on ESPN/ABC is a consistent ratings winner this year the ratings are half what they were in 1996.

The professional sports leagues, conferences and governing agencies of sports had better start saving some of those huge rights fees for the rainy days ahead.  Vast sums of money were paid by media outlets in recent years for multi-year contracts.  Since those deals were done, there has been a uniform decline in ratings for most marquee events such as the World Series, the NBA play-offs, and most bowl games.  These ratings decline come at a horrible time for the networks as the end of 2008, all of 2009 and perhaps 2010 will be years of recession in the advertising business.  Here they are with huge fees and production costs to cover, yet they have less audience to sell to fewer advertisers willing to pay.  Think back on all the big sporting events you have watched on TV and think of the advertisers who paid for exclusive sponsorships.  Let’s see, car companies, beer companies, financial institutions and airlines.  Anybody know what’s going on in those industries?

In the years ahead, the story about rights fees will be that for the first time in recent memory they will decline.  If they can no longer be covered by advertising and cable subscription rates and the ‘halo’ effect of marquee sporting events no longer exists, networks will ask for decreases or will walk away from the table.  The leagues will come down in price, and the trickle down effect of lowered franchise values, lowered player salaries, shorter term contracts and on-going lowered ratings will occur.

Take a look at what has happened since the Beijing Olympics and you can see the direction this is going.  NBC admits that even after producing hundreds, even thousands of hours of programming for the Olympics over multiple channels and the Internet they lost money.  Certainly the appeal of Beijing is greater than Vancouver, London and that place with the funny name in Russia.  The NBA cuts staff.  Two of the most stories franchises in sports history, the NY Yankees and the Dallas Cowboys can’t sell naming rights to their stadiums, due primarily to vastly overpricing them.

Off the playing fields and networks the drumbeat of news points to a lower financial participation in sports at all levels.  The global economy has collapsed.  Millions more of Americans will lose their jobs.  Corporations, after firing thousands of people, will not want to display corporate indulgence with skyboxes and named stadiums.  In households across America and around the world, thrift has become both a necessity and cool.  This is going to be the wall that sports franchises will run into when they try to continue their always upward pricing on season’s tickets and even individual tickets.  Some boats will sail, but there is no longer a rising tide.  When the cost of a big HD flat screen TV that will last for years is the same as taking a family of four to four games, the decision will become clear.  There is deflation going on in the consumer sector so how can sports entities think they are immune?

Here are some short term predictions to confirm this trend.  Outside the top four or five bowl games, tickets will be given away and stadiums will be half full.  There will only be tight camera angles on the field and no blimp shots to show how empty the stands are.  There will be lay-offs at the league and team levels.  There will be discount pricing of tickets the day of a game in most sports.  The credit crunch and severe recession will keep stadiums from being built.  Newspapers, whose sports pages had a symbiotic, promotional relationship with local sports teams, will be going out of business weekly.

Longer term, over the course of the next 3-5 years, there will be developments unheard of for sports fans.  The salaries of star players will come down dramatically.  There may be a two tier salary structure where one or two superstars continue to get well paid, but the back up quarterback or the forward on the bench will make much less.  Sports franchises will decline in value as rights fees and attendance decline.  Ticket prices will no longer go up every year and, when the ‘day of’ discounts are factored in, they will actually decline.

None of this is bad, just a directional change in the finance of sports.  As excess has been drained from many industries through the disintermediating affect of the Internet, the ruthless scale economies of the global economy and the current economic collapse so will excess be drained from sports.  Remember these years 1996-2008; they will be looked back upon as the golden financial days of Sport.

It is important to state that there are many traceable causes to this crisis. It is these particulars that politicians and those that need to blame something or someone will focus on as a way to justify a point of view or to seek retribution.  There will be much argument about who is to blame and what needs to be done to protect the U.S. and global financial system from further meltdown.  This is an important discussion to have, as long as there is perspective and an honest desire to right the ship rather than to just be right.

There have been financial crises in the past that can be looked at for guidance and for reassurance.  Guidance in how to handle what now confronts us, and reassurance that we can and will weather this crisis.  The Great Depression has been mentioned a lot this past week, as it was the specter of such a calamity that provoked the actions made by the Fed and the Treasury Department .  This was due in part to the fact that Ben Bernanke is regarded as an authority on this historical economic event.  Perhaps a more ...]]> As a futurist, I view the financial crisis that exploded last week from a high level, long term perspective.  The macro forces that are reshaping our world must be considered when such a crisis occurs.  In addition this particular crisis will force us to reevaluate long held economic ideals that may no longer have validity in their purest forms.

It is important to state that there are many traceable causes to this crisis. It is these particulars that politicians and those that need to blame something or someone will focus on as a way to justify a point of view or to seek retribution.  There will be much argument about who is to blame and what needs to be done to protect the U.S. and global financial system from further meltdown.  This is an important discussion to have, as long as there is perspective and an honest desire to right the ship rather than to just be right.

There have been financial crises in the past that can be looked at for guidance and for reassurance.  Guidance in how to handle what now confronts us, and reassurance that we can and will weather this crisis.  The Great Depression has been mentioned a lot this past week, as it was the specter of such a calamity that provoked the actions made by the Fed and the Treasury Department .  This was due in part to the fact that Ben Bernanke is regarded as an authority on this historical economic event.  Perhaps a more pertinent crisis to view is the banking crisis of Sweden in the early 1990s.  In that crisis there were a number of similar trend lines relative to housing and the investment portfolios of banks to the current crisis.  The Swedes suffered economic pain, but did exit the crisis to once again become a vibrant economy.

The first high level view of this financial meltdown is to state that economic and political ideal philosophies cannot exist in their ideal state when submitted to actual  human endeavor.  In the last century, the lofty, egalitarian ideals of communism and socialism attracted many people.  Unfortunately, whenever they were manifested in a governmental form, they failed.  The Soviet Union and Communist China collapsed because they did not value the dynamics of market economics and because the theory of equality gave way to self interest.  It was thought that a central planning committee could manage the economy, which proved to be woefully wrong.  It was stated that all for one and one for all and that all citizens were comrades and equal, yet inevitably the members of the communist parties had privileges in life that non members did not have, and the higher up the party hierarchy the more favors and luxuries one had.  So, the ideal of equality and centralized planning failed in its humanly manifested governmental forms.

The other dominant economic ideal is that the Market in unregulated form is the truest form of capitalism and is to be trusted to create the greatest good.  Adam Smith instead of Karl Marx.  However, whenever a government pushes toward this ideal, at least in recent times, there is failure and crisis.  It is clear to all observers that the current financial crisis is due to a combination of greed at all levels and a total lack of checks and balances and regulation of new financial instruments and practices.  The free market direction under Reagan led to the S&L crisis and the RTC.  The current financial deregulation under Clinton and Bush led to whatever this crisis will end up being called.  The Bush administration was so caught up in the “ownership society” that it didn’t want or try to put in checks and balances that might get in the way of everyone owning a home no matter what.

There obviously is a need for the hand of government in capitalism. This is particularly the case in this new global economy where everything is so interconnected. The question is finding the minimum amount of involvement and intervention that still allows capitalism to thrive but also avoids the greed generated melt downs we have experienced.  I am sure there are many libertarians that are conflicted due to the fact that the government intervention might have saved them from losing all of their life savings.

The other, larger view point on the crisis is relative to the fact that we are entering a new age.  This age, the Shift Age is the global stage of human evolution. We have moved passed national boundaries and now the only remaining boundary is planetary. At the beginning of a new age there is great disruption as new structures and new dynamics replace old ones.  This was seen in the 1970s when the era of “stagflation” and extended recession occurred as the Information Age supplanted the Industrial Age.  The filters through which we view the world become outdated and we need to find ones so that we can see more clearly.  We need to find new metrics that provide a greater degree of accuracy in evaluating what is actually going on in the global marketplace.  This will be the subject of the next column on the current financial crisis.

Recently, people have been asking me a lot of questions about the fluctuating price of oil

“What is the price of oil going to be?”  “Was the recent price spike of $147 a barrel an all-time high that we won’t see again?”  And “Will the global economic slowdown drive the price of oil back down below $100?”

These are just some of the questions I have been asked in recent weeks.  The reason of course, as long time regular readers of this blog know, is that I have been consistently accurate in my predictions about the price of oil.   In 2006 I predicted $125 barrel oil in 2008 and $137 in 2009.  In the past year I predicted that oil would have a near term trading range of $95 – 135 per barrel but that while there would be little downward pressure below $95, there are many scenarios that would provide upward pressure above $135.  All of this price predictions flow from my view that we have entered the time ...]]>

Recently, people have been asking me a lot of questions about the fluctuating price of oil

“What is the price of oil going to be?”  “Was the recent price spike of $147 a barrel an all-time high that we won’t see again?”  And “Will the global economic slowdown drive the price of oil back down below $100?”

These are just some of the questions I have been asked in recent weeks.  The reason of course, as long time regular readers of this blog know, is that I have been consistently accurate in my predictions about the price of oil.   In 2006 I predicted $125 barrel oil in 2008 and $137 in 2009.  In the past year I predicted that oil would have a near term trading range of $95 – 135 per barrel but that while there would be little downward pressure below $95, there are many scenarios that would provide upward pressure above $135.  All of this price predictions flow from my view that we have entered the time of peak oil globally.

I still stand on that trading range prediction.  Yes, the price has dropped from that $147 high of two months ago to, as of the writing of this column, $106.  That is a drop of  27%.  I believe that, at that peak in July, because of the lack of alternative investment options due to the sub-prime crisis, the bearish direction of the stock market and the heat in the oil futures market iself, there was a speculative trading factor of 10-15% in the price.  In addition, the dollar was at or near its’ all time low against the Euro when the price hit $147.

Well, since then, the dollar has risen some 8-10% against the Euro.  In addition we have learned the wonderful news that for the first time in 20 years Americans have several back to back months of year to year declines in both the amount of gasoline purchased and the number of miles driven by automobiles.  The pain of $4 a gallon gasoline has changed behavior and certainly automotive buying priorities.  Whether the price is $4 or drops to $3.25, people are realizing that historically high prices will now be the norm.

Most recently there has been the developing realization that the EU, and other countries are entering an economic downturn.  These two recent news stories have made traders dial down their price expectations and sell their long positions, certainly at least another 5% drop in recent weeks.  When you add this recent drop, combined with the removal of 10-15% speculative froth to the 8% increase in the value of the dollar, you get a spread of  23 to 28%.  This explains the drop in oil prices in the last two months, not any fundamental change in the global oil reality long term.

It is important to keep the long term view when looking at oil prices.  The average price per barrel in the U.S. since WWII has been around $25 a barrel.  That was roughly the price in 2001 at the beginning of the new millennium and also when Bush came into office.  We are now at a price that is 425% higher, down from 600% higher two months ago.  Due to this historical perspective, and given my view that we are indeed entering Peak Oil, I still believe that the price range for a barrel of oil will be $95 – 135.  It may dip below $95 occasionally but it could easily power through the $135 number with any combinations of hurricanes, political unrest in an oil exporting nation or news of demand continuing to outpace supply even in an economic downturn.  OPEC will do what it can, officially and unofficially to keep the price from falling much below $100

We are, and will be for the foreseeable future living in a world of historically high priced oil.  Until the coming revolutionary innovations in the alternative energy sector start to gain scale in the next decade we will be living in  one of, if not the most expensive time of energy in humanity’s history.

As long as humanity has known about the solar system there has been conjecture as to whether there was life anywhere else.  Mars has always been the prime suspect and has led to many books, movies and one famous radio event about Martians.  Most of the time such life forms have been presented as strange angry creatures that attack earth as we humans have trouble thinking other wise.  Those of us who believe in the statistical inevitability of life elsewhere have waited for concrete evidence.

The discovery of water on Mars does not suggest that there has or is life on Mars.  We do currently believe however that water is essential for the existence of life.  We now know, conclusively for the first time that water exists on another planet.  That is an incredible discovery.  It is a first.  Water is not unique to earth.

In an earlier column here I discussed the fact that scientists found another sun and planetary system that is similar to ours.  I also suggested in another column that perhaps the definition of life should be expanded as we search for it in space.  The fact that ‘life’ should be narrowly defined by earthly ...]]> Amidst all the chatter and news stories about who said what in the Presidential race and how SUVs have become undesirable, there was a story last week that will be one that 2008 will be remembered for, at least in the scientific community.  NASA’s Phoenix Mars lander found ice on Mars!!

As long as humanity has known about the solar system there has been conjecture as to whether there was life anywhere else.  Mars has always been the prime suspect and has led to many books, movies and one famous radio event about Martians.  Most of the time such life forms have been presented as strange angry creatures that attack earth as we humans have trouble thinking other wise.  Those of us who believe in the statistical inevitability of life elsewhere have waited for concrete evidence.

The discovery of water on Mars does not suggest that there has or is life on Mars.  We do currently believe however that water is essential for the existence of life.  We now know, conclusively for the first time that water exists on another planet.  That is an incredible discovery.  It is a first.  Water is not unique to earth.

In an earlier column here I discussed the fact that scientists found another sun and planetary system that is similar to ours.  I also suggested in another column that perhaps the definition of life should be expanded as we search for it in space.  The fact that ‘life’ should be narrowly defined by earthly terms struck me as planetary provincialism.  I still believe that there could be life forms elsewhere that are beyond our current definitions of life.

All that being said, it is essential that we fully acknowledge the discovery of ice on Mars.  It is a true scientific milestone.  Congratulations to all those scientists and engineers who have created the Phoenix and all the wonder it is now providing us.  Bravo!