Authored by Charles Hugh Smith via OfTwoMinds blog,

Understanding any complex system or situation begins by identifying contexts that illuminate rather than obscure, misdirect or confuse. 

I find these 12 contexts helpful in making sense of the current era of global conflicts.

1. Oil and soil. Oil and soil are the foundations of civilization. Both are being depleted. The technologies of recovering more oil have advanced, but there is no guarantee that these advances will continue. Diminishing returns could take hold.

The nutrient content of our food has been declining for decades. Meat is only as nutritious as the feed eaten by the livestock. The financial-economic mindset focuses solely on quantity of food produced, not the quality as measured by what counts: nutrient content.

Supplements / pills are not a replacement for micro-nutrients in real food; numerous studies have found that supplements have few if any discernable effects. The uptake of micro-nutrients depends on many factors, including a healthy, diverse microbiome and healthy, diverse diet of real food.

Soil is alive. It can't be restored by applying chemical fertilizers. It takes long-term composting with organic materials to restore micro-nutrients and micro-organisms.

Without ample, affordable food and hydrocarbon energy, civilization in its current configuration goes away.

2. The price of oil and food is set on the margins. A 10% drop in the supply of oil doesn't cause a 10% rise in the price; it causes a 50%+ rise in the price. A 25% decline in supply can trigger a 300% rise in price.

3. Shocks that destabilize base assumptions about the global status quo's costs and consequences are becoming more numerous.

4. There are no conventional political or financial "saves" for these shocks, which are not even recognized as destabilizing factors until after the fact.

5. The "Waste Is Growth" Landfill Economy of disposable products, low-quality goods, planned obsolescence and accelerated product cycles was never a wise use of resources, capital and labor, nor was it a stable system. The illusion of stability was created by unprecedented expansion of credit, money and globalization since 2008.

6. Hyper-financialization and hyper-globalization are in the decline phase of the S-Curve. There is no restoring the conditions that held from 2001 to 2019.

7. There is no replacement system. What are touted as replacement systems are failed ideologies and mythologies.

8. Progress has been replaced by Anti-Progress, but this has been obscured with hype (AI!) and runaway expansion of credit. The quality of life--hard to measure--has deteriorated while financial statistics--easy to measure--are ceaselessly hyped.

9. Credit and the predatory Addiction Economy (we're addicted to credit, social media. ultra-processed foods, drugs, smart phones, etc.) are self-liquidating. Interest payments eat the financial system alive and addiction is not a sustainable, healthy model of "growth" for the economy or society.

10. Uncertainty is destabilizing, and uncertainty is in the boost phase of the S-Curve.

11. Shifting the gains of increasing productivity from wages to financial speculation and credit-asset bubbles was never a sustainable foundation for the economy or society, as all speculative credit-asset bubbles burst.

12. The global status quo has been hyper-optimized into a tightly bound system: everything is connected, and vulnerable to disruption from forces and events that appear unconnected at first glance.

Unstable, dynamic, tightly bound systems that operate beyond the sight lines of conventional understanding and expectations are unpredictable. This suggests taking every prediction with a very large grain of salt.

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