Baiji “fundamentals”

This is going to be an even “crazier” post than usual, so please keep up with me and just go with the flow for a little while and hopefully things will make sense at the end.

Assume you’re a fan of freshwater dolphin meat.  I know you’re not, but just go with me here.  Assume you’re also an investor.

The “fundamentals” regarding freshwater dolphins from an “investor” perspective are very good.  The baiji on the Yangtze are dying due to their food source (fish) being massively overfished and appalling pollution problems contaminating the Yangtze from China’s industrialisation.  Some have declared that the baiji are “functionally extinct.”

As an investor, it would be wise to try to “invest” in baiji, wouldn’t it?  Supply down, demand either steady or up (on anticipation of limited supply).  Price should be higher.

Two points immediately need to be addressed from this hypothetical.

First, for those who think it’s “distasteful” to even consider valuing dolphins in terms of their meat, I say to you – think it through carefully.  The harsh reality of life is that animals and plants which are useful to humans are “protected” by humans and flourish. 

Those with no value to humans are vulnerable to extinction.

This has been proven time and time again throughout modern history.

I don’t like this either, and I wish the human population would not grow exponentially.  Then again, I wish I was a dictator so I could turn this loser nation of overconsuming mindless debt-drones on to a more sustainable path of development.  In both cases, I’m dreaming. 

We have to deal with reality.

And the reality is that animals that we can eat survive in this crazy world much better than animals that serve us no purpose. 

The absolutist thinking of so-called conservationists drives me crazy.  This kind of “leave alone!” thinking is naive and dangerous and infects so much of the environment movement.  I cannot believe their basic naive stupidity.

The ban on the sale of elephant tusks in my mind is crazy.  Elephants have become less valuable to local communities in Africa.  Elephants “compete” for arable land.  Guess what’s going to happen when you ban the sale of elephant products?  There’s going to be ongoing tension between local communities and international organisations who don’t have to live with the problem (and who coercively scream for a ban on the sale of anything elephant related).  Ultimately, the local communities will have even more of an incentive to kill the elephants and not help sustain the elephant population.  What do you think is going to happen over the long-run? 

Obviously, land will be taken over by local communities in need of food.  Elephants will die due to lack of natural habitat.  They will not have been “killed” literally by a gunshot, so the zealots in the international conservation organisations will be silent.  But the elephants will die just as surely as if they had been killed for their tusks.

Same with whaling.  Why we are so paranoid about Japanese whaling I will never understand.  We overfish, we pollute the waters with oilspills, chemicals, toxic sludge and refuse, we kill the natural habitat of the whales with a massive toxic plastic waste dump in the middle of the Pacific Ocean – and yet we criticise the Japanese for “hunting” the poor whales.  We kill them slowly but just as surely through starvation, through the destruction of their natural habitat, but because that’s one step removed, because it doesn’t involve a direct bullet to the head, somehow everyone is OK with that.  But when the Japanese actually kill a single whale – whoa… that’s barbaric! 

I can’t stand this hypocrisy, this stupidity, the childish incapacity to directly connect up destruction of natural habitat with the death of an animal.  As an animal I’d prefer the quick and relatively painless death of a bullet to the head (safe in the knowledge that some of my family would survive and possibly even by protected by my killers) rather than a slow and excruciating and depressing death by starvation and destruction of my whole natural habitat, grieving knowing my children will slowly but surely starve to death, perhaps be forced to eat toxic plastic… knowing that none of us will survive. 

Which would you prefer, if there was no other choice?  And don’t say there’s a third choice.  There isn’t. 

Unless humans agree TODAY to stop all human reproduction and start consuming less, there is no third option.

Given this sad reality, I have another invariable rule for environmentalists to consider:  Once an animal is valued by man, it is protected by man.

Sheep outnumber New Zealanders for a reason – sheep are valuable.  New Zealanders take care (good care) of their sheep. 

Kiwi birds can’t be eaten.  They have no direct intrinsic value.  They are difficult to spot in their natural habitat so they are not even valuable from a tourist perspective.  Guess what – they are dying and are nearly extinct.

So discussing dolphin meat for me is perfectly reasonable.  Ironically, if freshwater dolphin meat was more valuable perhaps the baiji would not be functionally extinct today.

But this is not even the main point of this post.

Let’s continue with this thought experiment. 

In a superficial sense, you would think as a naive investor (supply down, demand up) that somehow “getting into” freshwater dolphins would be a good idea.  BUT THE WHOLE HABITAT OF THE DOLPHIN IS BEING WIPED OUT.  This is not a matter of being able to “invest” in dolphins.  What we are witnessing in the case of the baiji, I’m sure you would agree, is inevitable extinction.

Similarly, Jim Rogers consistently states that the “fundamentals” for agriculture are incredibly positive.  He states that investors should get into agriculture.  Supply is down.  Demand (with population growth and rising Asian incomes) will inevitably go up.

Although I respect Jim Rogers as an investor, this shows his limited thinking, his inability to see the full implications of the trends here.  He has spent his whole life as a commercial trader and investor, not as a social scientist or economist or philosopher.  He sees the problem, thinks in terms of supply and demand and then concludes that investment in agriculture is a good idea.

I beg to differ.  Although I respect Jim Rogers as an investor, I don’t respect him as a deep thinker.

My view is that we are watching EXACTLY THE SAME PROCESS AS THE EXTINCTION OF THE FRESHWATER DOLPHIN, APPLIED TO HUMANS!

Overfarming cannot be reversed.  Topsoil is irreplaceable.  Phosphates, once lost, cannot be replaced if there is no supply.  The water table once polluted cannot ever be cleansed of chemical toxins.  Destruction of arable land is in most cases irreversible.

The price mechanism cannot transform houses into farmland, cities into arable land.  Once destroyed these things (vital for our very survival) cannot ever be put back in place. 

Similarly, once the freshwater dolphin is extinct no amount of hedge fund investment is going to get its natural habitat back.

So Jim Rogers is right to see the trend, but he hasn’t worked out the full implications. 

WE ARE ACTUALLY WATCHING THE DESTRUCTION OF OUR OWN FOOD SOURCE.  WE ARE WITNESSING BEFORE OUR VERY EYES THE DESTRUCTION OF OUR OWN HABITAT.  WE ARE INEXORABLY CAUSING OUR OWN EXTINCTION.

If you think I’m crazy, please read this article and this previous post and then tell me you’re 100% confident that governments and investors will get us through this little problem.

Sometimes the price mechanism has become so corrupted by bankers and governments that the warning bells don’t go off until it’s too late

I don’t believe we are watching a “bull market” in agriculture.

What we are watching is the massive extinction of our various food sources, resulting in a massive food crisis for the (much higher!) human population in a few short decades.

No amount of hedge fund money will turn Asian cities back to rice paddies, Western suburbs back into farmland, or polluted toxic African mining towns back to unspoilt Savannah.

It’s already too late, in my view.  The trends are “locked in”. 

We are the next freshwater dolphin.   We are killing ourselves.  Climate change, if it exists, will simply accelerate this process.

Those institutions supposedly designed to “forward plan” us out of this mess also happen to have control of the guns.  History records that when a crisis hits, governments turn from protector to predator, plundering the people for food.  Chile.  Zimbabwe.  Cambodia.  Talk to indigenous peoples in Australia, in New Zealand, in Hawaii, in North America, in South America, in Asia, in Africa about what elite governments do to those they supposedly have a duty to protect.

Sorry, that’s right. You can’t.

Because they’re already dead.

Advertisements
  1. Alice
    December 28, 2009 at 7:32 am

    so right…I have no answer

  1. No trackbacks yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: