The Oil Drum: Canada

This month's edition of National Geographic has a feature article on "Soil", which looks at the steady degradation of agricultural land and the problem this poses in world where the population is heading for 9+ billion people - effectively calling attention to the "peak dirt" problem (however soil is renewable, so any "peak" should be able to be reversed if sufficient time and effort is put into doing so).

The article uses an acronym I've never come across before to describe the problem faced by those trying to draw attention to the issue: MEGO (My Eyes Glaze Over) - a phenomenon which should be familiar to anyone who has ever talked about peak oil, global warming or any of the other "limits to growth".

This year food shortages, caused in part by the diminishing quantity and quality of the world's soil, have led to riots in Asia, Africa, and Latin America. By 2030, when today's toddlers have toddlers of their own, 8.3 billion people will walk the Earth; to feed them, the UN Food and Agriculture Organization estimates, farmers will have to grow almost 30 percent more grain than they do now. Connoisseurs of human fecklessness will appreciate that even as humankind is ratchetting up its demands on soil, we are destroying it faster than ever before. "Taking the long view, we are running out of dirt," says David R. Montgomery, a geologist at the University of Washington in Seattle.

Journalists sometimes describe unsexy subjects as MEGO: My eyes glaze over. Alas, soil degradation is the essence of MEGO.

One subject that features in the article is soil restoration, including a look at "terra preta" - rich, fertile artificial soils found in the Amazon. In this post I'll have a look at modern day techniques to produce terra preta (often called biochar or agrichar) which have the potential to increase soil fertility, generate energy and sequester carbon all at the same time.

The situation in the credit markets continues to worsen as a sudden attack of risk aversion rapidly dries up liquidity. And this is before the resetting of adjustable rate mortgages (ARMs) begins in earnest - to the tune of $50 billion - in October. Watch this space.

On the Canadian energy scene, Shell pumps $27 billion into the oil sands, even as oil patch profitability falls. Abu Dhabi wants to invest in Canadian power plants, and there are plans for BC to host an LNG terminal. Wind power grows rapidly in Ontario and Quebec, making a few enemies along the way. In BC they ask: should public transit be free?

On the climate front, water is the issue - too little and too much. Finally, in the tug-of-war between efficiency and resilience, efficiency has the upper hand, but what price will we pay for allowing our life support system to become brittle?

Going With The Flow?

You may remember that our definition of household cash is as broad as can be. We include all household "banking products", per se, but also include all household holdings of bonds, inclusive of Treasuries, Agencies, corporates, muni's and mortgage backed paper. Implicitly, we are assuming bond holdings could be converted to cash at a moments notice. So what follows is simply total household cash less total household liabilities over the last six decades.