ECONOMY

With the discovery of fuels to advance human civilization, humans have globalized trade to increase growth.  Because EROI is declining, human society is using more debt to bring additional growth.  

Any source of money (Digital, gold, hard cash, crypto - is a claim on Energy).  The value of money depends on how humans can obtain additional energy to increase wealth and maintain previous wealth.  Since the system is leveraged and fiat currency does not have physical tethers, money is just a claim - NOT a guarantee to receive the full value of the claim.  Every claim (no matter what source of money it is) requires energy and resources to claim.  

Big takeaway and a future risk to organizations and individuals:

More leverage in money claims along with more claims on money (debt, various sources of claims - crypto) against a world of higher extraction costs of energy and resources has huge implications when too many people want to claim that money. 

Mapping Focus for the Economy and trends we will be watching

Our Mapping Strategy would be to have a map on how your organization takes in and uses money and how the economy impacts you.  Then, focus on the risks:  

Interest rates

Recession/Depression

Changes in Money

Changes in the Value of Money

Changes in the Confidence level of Money

Inflation

How the Cost of Energy/Resources will impact Money

Trends in the Economy and Money and Energy

Changes in Debt and the Perception of Debt

The trend we will watch carefully is the Energy aspect and the Perception/Confidence aspects.  Fiat Money is not tied to anything.  Thus, it relies on both Energy and Confidence.  The 2007-8 Financial Crisis provides an excellent example of the Cost of Energy and the Lack of Confidence.  A system that is leveraged needs continuous Energy and Confidence (Order) as the implications of a breakdown of these can be severe.  The world continues to add debt as a way to bring demand forward.  As the EROI of energy fluctuates and trends lower, we expect the way debt is managed will change and we expect power struggles (nations against nations and within nations) to increase in how debt claims are settled. 

ECONOMY

The Economy runs on Energy and Resources.  It will run better with cheaper Energy and Resources.  Areas in 2025 we will be watching for the Economy include:

     - Competition between nations and how that can impact the Global Economy

     - Debt - There is a lot of it

     - Currency - The US dollar, other currencies, and crypto

           >  Remember, each dollar spent requires Energy!  (A dollar is a claim on Energy)  There are more claims on Energy than can be processed with current energy and resources.  We witnessed this during the Global meltdown in 2008 and 2009.  If everyone went to the bank to get their dollars, we just do not have them.  This Tail Risk will be a constant risk to monitor.  Bottom line - You can have as much currency as you want, but it is limited by energy and resources.

2025 News Stats and Information on US and World Economies