{"id":22859,"date":"2008-06-23T16:43:00","date_gmt":"2008-06-23T16:43:00","guid":{"rendered":"https:\/\/clusterfamilyoffice.com\/blog\/?p=495"},"modified":"2008-06-23T16:43:00","modified_gmt":"2008-06-23T16:43:00","slug":"invertir-sin-petroleo-1","status":"publish","type":"post","link":"https:\/\/clusterfamilyoffice.com\/en\/invertir-sin-petroleo-1\/","title":{"rendered":"Investing without oil (1)"},"content":{"rendered":"
If we fail to curb the rise in energy prices, not only will it hit the pockets of the poorest countries and the economies of the developed world, but it will also put the brakes on our much-debated globalisation. And it will therefore affect the very development of our civilisation as such.<\/div>\n
\"\"<\/a>The process of globalisation that has been underway in recent decades, beginning with the worldwide commercial roll-out of the internet and continuing with the movement of goods and people low-cost<\/span><\/a>, will be jeopardised as energy costs rise.<\/p>\n

\"\"<\/a>A generation or so ago, it was impossible to consume tropical fruit outside the tropics themselves. In the near future, if energy costs continue to rise, it will go from being commonplace to being prohibitively expensive. The question we might ask is this: is it a bad thing if we return to consuming only locally grown, seasonal produce and the developed world no longer has everything available all the time? My answer would be: it depends. For developed countries in general, it need not be dramatic \u2013 or even negative \u2013 if they consume only their own seasonal produce and have to diversify local production once again to meet regional needs. In that case, only essential products from far-off places \u2013 such as medicines \u2013 would be imported, albeit at a sky-high price (black market, of course). But this very same phenomenon would be disastrous for the developing world, as condemning them to produce solely for their domestic market would spell the demise of countless sections of the population. It is chilling to imagine an emerging or even underdeveloped country unable to export because transport costs completely erode its competitiveness. However, logically, transport costs do not affect a large, heavy and cheap product in the same way as they do a small, light and expensive one. In other words, for example, rising energy prices will not affect the transport of video cameras as much as that of bicycles, even though both products are made in China.<\/p>\n

\"\"<\/a>If these countries with extremely poor economies have any advantage at all, it is precisely their cheap labour, which makes their products attractive to the developed world. But the moment a sweatshirt costs the same or less made in Italy, Spain or France<\/span> another one (probably of poorer quality) made in Indonesia, Korea or Taiwan<\/span>, the world we had grown accustomed to will be a different one. We should abandon the specialised production that we have been developing since the end of the last century, and return to diversified production due to the absence of commercial globalisation. The scenario we would be forced to contend with \u2013 one of runaway oil prices and no immediate alternative \u2013 is, to say the least, disturbing. Undoubtedly, it is a clearly regressive outlook (with apologies to the anti-globalisation movement).<\/p>\n

However, the phenomenon of globalisation is something that is difficult to reverse; only an event of such a massive scale affecting the entire planet \u2013 such as an energy crisis \u2013 could slow down (though not halt or eliminate) this globalisation. I hope that, having observed the peak oil<\/span> three or four years ago, and before we reach a point of exhaustion that goes beyond simply rising oil prices, we must be able to develop a truly viable and global alternative. Otherwise, we may well see the hitherto breakneck pace of globalisation come under threat.<\/p>\n

\"\"<\/a>Venturing into economic fiction \u2013 though I fear it is less fictional than it seems \u2013 let\u2019s imagine a scenario of unsustainable and persistent energy costs. In other words, we\u2019re caught out (if we haven\u2019t already been) and find ourselves thrust into a world with the characteristics we\u2019ve outlined, and for decades to come. We\u2019re unable to find a cheap, abundant and global energy alternative like oil was until a few years ago. Let us imagine, then, that international trade is drastically altered as a result, and that industries and economies become significantly less global. However, despite this scenario, the financial markets would continue to thrive on the flow of information, remaining almost oblivious to the problems surrounding the movement of goods and people. Let us raise some interesting questions: What will happen to financial investments in such a scenario? What investment strategies should we devise to ensure our wealth continues to grow at a healthy rate in the face of a severe energy crisis?<\/p>\n

\"\"<\/a>It would be really interesting to read your comments on this, especially if they aren\u2019t limited just to the purchase of petroleum products, of course \ud83d\ude42<\/p>\n

Perhaps if we start to think about what our investments might look like in that fictional economic scenario, we might find some interesting and useful guidelines for the current real-world situation. A long-term investment strategy today might well require an analysis of this future scenario.<\/p>\n

\"\"<\/a>The globalisation of financial markets does not require oil and, thanks to the internet, these markets would be the main beneficiaries of the inability to carry out physical movements caused by the lack of cheap energy. And there is no doubt that, in such a scenario, the prices of equities, commodities, sovereign or corporate fixed income, and indeed any product created by the financial sector, would be profoundly affected. Are you thinking of the same sector as me? Perhaps even the same companies?<\/p>\n

And the fact is that the mother of all crises<\/span> I couldn\u2019t imagine it without the mother of all opportunities<\/span>.<\/p>\n

\n
We must find a way to protect future generations from the greed or incompetence of the present ones.<\/span><\/div>\n

Napoleon Bonaparte.<\/p><\/blockquote>\n

<\/div>","protected":false},"excerpt":{"rendered":"

Si no conseguimos frenar la escalada del precio de la energ\u00eda, no s\u00f3lo se resentir\u00e1n los est\u00f3magos de los pa\u00edses m\u00e1s necesitados y las econom\u00edas de los pa\u00edses del primer mundo, tambi\u00e9n supondr\u00e1 un frenazo a nuestra cuestionada globalizaci\u00f3n. Y por tanto afectar\u00e1 a la propia evoluci\u00f3n de nuestra civilizaci\u00f3n como tal. El proceso de […]<\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[],"class_list":["post-22859","post","type-post","status-publish","format-standard","hentry","category-sin-categorizar"],"_links":{"self":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/posts\/22859","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/comments?post=22859"}],"version-history":[{"count":0,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/posts\/22859\/revisions"}],"wp:attachment":[{"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/media?parent=22859"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/categories?post=22859"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/clusterfamilyoffice.com\/en\/wp-json\/wp\/v2\/tags?post=22859"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}