On Investing: The future isn’t grim, and it belongs to young entrepreneurs
Barry Ritholtz
Washington Post


On these pages, I have cast a rather skeptical eye on all matters financial. I have mocked the housing recovery calls, critiqued the valuation of Facebook, despised the robo-signing settlement, urged caution on the Black Friday retail hype. The silliness coming out of Wall Street is much like a carnival barker urging us to play one more of “games of skill.”

All of which goes to say I am not your run-of-the-mill perma-bull or economic cheerleader. Readers, in fact, have called me a curmudgeon.

And yet, as I look to the long term, I’m optimistic.

Part of my misspent youth involved a fascination with dinosaurs and astronomy. The vastness of space was unfathomable, the millennia across which the dinosaurs ruled unimaginable. At least, until I learned exponential functions in algebra, which gives you a framework for dealing with all those zeros.

Hence, one learns to think in different time frames, including very long geological epochs and astronomical eons. The Triassic period is replaced by the Jurassic, which in turn is replaced by the Cretacious, and so on. This is important, not just because it helps to understand the long cycles, but also because it helps to grasp crowd psychology.

You see, there is a natural order of things, with the old replaced by the new, the more efficient displacing the less. The steam engine lost out to the internal combustion engine; dinosaurs were replaced by the smaller, more adaptive mammals; and you, old man, are going to have your sorry behind replaced by kids brimming with ideas and energy.

This is a good thing.

Creative destruction can be wrenching — whether in technology, economics or evolutionary biology.

The economic upheaval of recent years has led people to feel oppressed and frightened about the future. And the public has plenty of legitimate concerns: People are fearful of losing their jobs, not interested in buying homes, uneasy about their long-term security.

The fools in our midst are those who make a living scaring the bejesus out of the rest of us. Nothing is ever a mere problem, it is imminent catastrophe. There are no simple issues, only Armageddon. Debating taxes is not about revenue and spending, it is about class warfare. Even a cyclical recession, something we have had nearly 20 times over the past century is sure to slide into a depression. It’s as if we now live in an ALL CAPS WORLD.

No wonder the crowd is suffering a malaise. In addition to the real fears, they have lots of fake ones hanging over their heads. After a Great Recession, this is to be expected. We had the rise of the End of Worlders and the Zombie Bears. They are best ignored.

I bring all of this up because I spent last weekend at a conference in San Diego checking out a run of start-ups. I had lunches and dinners with young entrepreneurs and techies and their angel funders.

The companies were impressive. Some were good, some were great, and more than a few were stunning. But this was not about any new hardware or app or gee-whiz technology. Beyond all that, I was truly taken with the entrepreneurs. Their ideas, energy, passion, competencies — all were just astounding. After seeing that, it’s impossible to be negative about our long-term prospects — and, yes, I see the valley ahead of us.

It is not merely about the ideas and the technology, but about the drivers of them. If you want to understand the future of America, if you want to grasp why we are not doomed, then you must spend some time with young entrepreneurs. Their creativity, business acumen and technological insights are uplifting, energizing, empowering. It’s fertile ground, not just in Silicon Valley but across the land: San Francisco, New York, Boston, Miami, Washington, San Diego, Denver, Atlanta. That is where economic growth will come from.

As the demands of life pile on, it’s easy to forget how much you wanted to change the world when you were young. You might be stuck in a job you don’t love, a too-big mortgage, demands of family . . . suddenly, we forget who we once were.

They still know. The youth of America don’t care that their parents screwed everything up — they are going to steamroll over the old order and replace it with one of their own (just like their parents were and theirs before).

A thing I have noticed about today’s youth: They have no illusion that any company will offer them much in the way of economic security. They have a firm grasp on the idea that they are a business of one — even if they work for IBM or Uncle Sam. They are their own team, a singular brand, their own idea factory.

These kids are not looking to Washington for help. They find political debates in this town laughable. Like two Tyrannosaurs debating who gets to devour the plant-eater, wholly unaware of the giant asteroid hurtling their way. You want to know how that argument got resolved? How does this argument get resolved? It gets settled by a giant asteroid.

The old order, the political hacks and hangers on, the whiners and recessionistas, and the permabears — these are the dinosaurs in our story — have no idea what is coming their way. They cannot see the asteroid hurtling their way from the deep black depths of space, so busy are they in pointless debates and parliamentary maneuvering.

The future of America is not being driven by Goldman Sachs or the GOP or President Obama. That’s old school, the old order and oh-so-yesterday.

The future is driven by people who are young enough that they still want to change the world. They have the ideas, the venture financing, the technical acumen and the creativity to push us forward. Based on what I have seen, the old regime will still be arguing while the new one steamrolls over it. Sure, the old order has the money and the power, but it has run out of time, vision and drive. That edge goes to the youth.

Don’t say you weren’t warned.


Ritholtz is chief executive of FusionIQ, a quantitative research firm. He is the author of “Bailout Nation” and runs a finance blog, the Big Picture. You can follow him on Twitter: @Ritholtz

Category: Apprenticed Investor, Markets

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

65 Responses to “Hey Old Man! The future isn’t grim”

  1. denim says:

    Hey, some of us old guys don’t do too bad: “Colonel” Sanders (Kentucky Fried Chicken): At age 65, Sanders’ store having failed due to the new Interstate 75 reducing his restaurant’s customer traffic, he took $105 from his first Social Security check and began visiting potential franchisees. He did not even have to borrow $20,000 from mom & Dad.

  2. carleric says:

    Let me just add this; Yesterday I visited a 5th grade science fair in which my grandson took part. I was surprised and amazed at the depth of understanding and creative efforts made by these kids….I am at heart one of the curmudgeons according to those who know me best but this old bear walked away filled with renewed hope for our country’s future.

  3. techy says:


    I disagree, with youth UE at 18%, I am not sure what they are going to be doing other than looking for anything and everything to pay their bills.

    Lack of opportunity can stifle creativity and god forbid when that energy gets converted into a negative energy, you will see society in unrest.

    I firmly believe that thanks to the religious, racist collaboration with the capital owners 99% does not stand a chance since 50% of them support it because of their ignorence. Imagine a 50 year old white man supporting cuts in medicare and social security to support tax breaks, why is he doing that, because it is the only slogan of his party and he is full of hatred and belief in fairy tales make him support his party no matter what.

  4. techy says:


    I forgot to add, I hope you are right and I am wrong, because I dont know what I will say to the next generation about my contribution to the future. As of now all I can say was: I was helpless because the mob took over and we were outnumbered(democracy of the fools) and I did not had the guts to sacrifice my normal life and do something more.

  5. hankest says:

    Put in a paragraph about some wisdom you gained chatting with your cab driver from the airport and this could be a T. Friedman piece.

  6. mikeinconyers says:

    I agree with your assessment Barry. I only have to look to my sons, who over a few short years have become successful entrepreneurs. Their creativity, persistence, hard work, and passion for their chosen endeavor is paying off both for them and for society. I hear the pundits saying that this generation is going to do less well than the prior generations, but from my perspective, that need not be so.

  7. Old Rob says:

    I find this rant rather surprising considering the source. What makes anyone believe that their generation is any different than the previous? The details get reformed by the experiences that are observed, but in the end, progress depends on the willingness to correct or enhance those experiences. Old order ‘hangers on’ were once young and had ambitions. Their experiences and observations finally drove them along a path that might not be too progressive or productive in the opinion of a later generation, but it was an outcome. In examining the video of BR’s recent trip and takeaway to the Left Coast, I am amazed that he finds the so called ‘new ideas’ so compelling. Maybe the younger generations will invent new ‘money-maker’ ideas as Facebook, etc, but the true value to society might not be so rewarding. What is more value? The cure for a disease or a new i-machine? One has a hell of a ROI, but the other is of true value.
    And by the way, who really gets ‘steam-rollered’? Tell that story to the ‘young’ people who had to finght in trenches of WW-I or beaches of WW-II because some admittedly old leaders could not get their act together. No the younger generations will always have great earth-shaking ideas, but when they have to survive or the economy goes against them, things become practical in a hurry.
    Too much stated!!

  8. By emphasizing “long term” as it concerns your optimism, would it be fair to say you envision more “economic upheaval” for us before we arrive at that “valley?”

  9. aprather says:

    Great article. As an entrepreneur myself, we capitalized on just this….the fact that there is so much complacency and frankly dinosaurs. This was the genesis behind myself and three other relatively young partners starting our own business.

  10. Dow says:

    I really don’t want to say this but I think you just jumped the shark.

    Reality: natural resources are dwindling, the planet is grossly over populated with 2x as many people as their are resources to support them, and innovation isn’t going to save us because we squandered too many of those resources channeling everything into consumerism rather than basic needs.

    But hey, party on like it isn’t taking place.

  11. murrayv says:

    I have no doubt that there are plenty of capable young entrepreneurs out there, but I still worry about 2 things. First how far out does your optimism kick in? How long before we get to the bottom of the valley, and how deep is the valley? Second did you see any good, or great or stunning new ideas that create jobs? Most of the new developments I see brewing are digital and/or artificial intelligence. They either create very few or actually destroy jobs. Contrary to some of your readers, I believe we have entered a new economic period in some ways comparable to the industrial revolution that we are unequipped by experience and learning to deal with. Unlike the industrial revolution, technology now moves faster than we humans can readily adapt, and for the first time in history, technology destroys more jobs than it creates as so much of what we value goes immaterial, or as machines become capable of doing jobs that hitherto required human brains. Just think of ATM machines at the simple end, through e-books tasks like x-ray analysis at the more demanding end. Even speech recognition has become near 100% accurate, so I no longer need a keyboard and mouse. My control of my computer becomes immaterial. What kind of economy will we have without jobs for a very large segment of the population? We need more than simply bright young budding entrepreneurs.

  12. SOP says:

    Cut and paste this entry for inclusion in the 2040 update of Popular Mass Delusions and the Madness of Crowds”

    My favorite part was “At least, until I learned exponential functions in algebra” … (paging Professor Al Bartlett … you have a patient waiting to see you. )

    Barry, what percentage of the p0pulation will participate in this Utopia?

    And what percentage will be consumed to build and maintain the Utopia you envision?

  13. b_thunder says:

    “The future of America is not being driven by Goldman Sachs ” – seriously? And you’re making this conclusion based on the PowerPoints about the new start ups in the Silicon Valley?
    Without Goldman and its industry, none of the start-ups would happen. No, I’m not really praising Goldman. What I’m saying is that once Goldman et al are done “pushing” their “web2.0″, “social” and “cloud” theses onto the Joe DumbInvestor, the party will be over! There won’t be a 2-year ongoing Chuck Prince-like game of musical chairs, the Web 2.0 lights will go out overnight!
    Among those start-ups, how many are making money NOW? And how many will ever make money? And how many of them deal with or improve life’s basic needs – food, shelter, energy, medical care? Let me guess – the “basic needs” werer outsourced to China and PinkSlime factories, right? Look, sharing photos, “check-ins” and “likes” is not life-essential. Those start-ups will go when money dries up (or when parents will quit paying the $150/month iPhone/iPad 3G phone bills.)
    The .dom that I worked for while in college shut down 2 weeks before I graduated. I was too young to enjoy that party. Oh, well… At least back in 2000, when .coms liquidated I could pick up almost new hardware at fire sale prices. New start-ups don’t even bother with hardware – it’s all in the “cloud,” right? When they go under, there will be no traces left. Not even WebWan sock-puppets.

    The 2000 bust happened rather suddenly. It will happen again, at the time of Goldman choosing.

  14. louiswi says:

    Great post today Barry!
    Once the angry white men luddites get out of the way, the young people are going to create a new world. One that finally has a chance of allowing our species to continue to exist.
    I work with several of these groups today. They are very very smart but not hung-up with the silliness that abounds at the moment.

  15. bobnoxy says:

    Dude, pass the doob around. I could use a break from reality too!

  16. deanscamaro says:

    @ Old Rob
    Agree with your assessment. Hawking flashy products from the tailgate of a snake oil salesman’s wagon, doesn’t mean they will save the world the old men have had to deal with (or may have caused). Too many great looking balloons will pop and fall to the ground before they get high enough to save the world.

  17. SOP says:

    Grumpy Old Men on TED talking about the Really Big Picture:

    James Hansen: Why NASA tried but Failed to shut me Up – so they changed their mission statement



    Jared Diamond on Guns, Germs and Steel and stupid naked apes-vs-mental monkey traps


    Grumpy Uncle Albert –

    We’re so sorry, uncle Albert – But the kettles on the boil and we’re so easily called away. (hands across the waters – heads across the sky ;)


  18. yuan says:

    Does all of this new technology — especially highly addictive technology that is beginning to dominate our psycho-social interactions make us happier?

  19. SOP says:

    What percentage of the p0pulation will participate?

    And what percentage will be consumed ?


    Thirty-four Colombian tribes face extinction, says UN article


  20. NetCentric says:

    Totally agree with you about the asteroid Barry and with the potential in the latest generation however I disagree with your rosy image of the aftermath of the asteroids impact. Tunisia, Egypt and Libya are what the impact of the demographic asteroid looks like. Those countries will now be a mess for a very long time.

    By the time the mammals in your analogy have a chance to build a new world the fact that the dinosaurs used up all the resources will pull the carpet from under them. Without resources, as Galbraith pointed out, they will be trapped in an inescapable cycle of poverty.

    Do I wish things were more as you suggest? Of course I do, I have two children and am more Dalai Lama than Ayn Rand. I wish you were right but the numbers just don’t support your view.

  21. river says:

    The only thing that I would counter with is that we may be in a period of diminishing returns. Man went from dreaming about flying to actually walking on the moon in something like 70 years. Since then, not much advancement. Maybe the planes are a little bit bigger, a little bit safer, a little bit more fuel eficient in the present time than they were in 1970, but the benefits/productivity increases get smaller and smaller going forward. Is there any kind of scientific advancement where that amount of advancement is still available?

    Of course, we don’t know what the future will hold so it only takes a few inventions that blow us all away to prove me wrong.

  22. Glen says:

    Hey, as an engineer, I too, am more than aware of all the great things happening out there, BUT, our government is pouring a tremendous amount of resources into maintaining the dinosaurs, plus our government has been rearranged by these same dinosaurs to squash innovation and start ups. Ultimately, I expect humanity and the world will move along to the future, but I seriously doubt that America’s role in that future will be the same as it was after WW II. China seems to be poised to take that role.

  23. Petey Wheatstraw says:

    “If you want to understand the future of America”

    America? As in the Constitutional Republic of the United States of America? America, the nation of laws?

    Well, BR, that “America,” is no more.

    IBM and Uncle Sam are one and the same.

    Certainly, there will be a future. Its brightness, I suppose, depends on one’s vantage point — is one piloting the drone, or being targeted by it. Is one part of the oligarchy, or subject to its whims? Are you upwind/upstream of the reactor/chemical groundwater plume and highly mobile, or downstream and without mobility?

    All of the technology, entrepreneurialism and youthful exuberance in the world won’t amount to anything without the political framework that keeps such things safe. “America” is a political system, and it has been compromised. Technology and entrepreneurialism cannot revive it. (Unless, of course, one of these kids shared the technology that would return us to the Rule of Law, by, lets say, fixing the huge property ownership question caused by MERS? If so, then I’d be fully on board with the idea that “America” has some kind of future).

    Other than that, I wonder why you would thing that our incompetent, corrupt, and less than worthy leadership would be replaced by anything but more of the same.

  24. Sunny129 says:


    It is nice to be optimistic but also pragmatic. Changes anticipated in your ‘time frame’ may mean nothing or very little in my time frame or for the remainder of remaining span of my life.

    I am a immigrant from a developing ( third world) country who came to USA (in 1970) with a professional degree in hand and pursued a post graduate education( 6 years) later settled. The gas was 29c/gallon. The young man who was pumping gas had a better prospect in life than many Phds in my Country! I was hungry and insecure but worked hard to get my security. There was no 1% collecting rent from the 99%! There were no 47 M collecting food stamps. There was NO 1 Trillion student debt.

    Fast forward 42 yrs. USA is slipping towards a third World status. Drop rate for High schoolers and college before graduation is more than 50%. Functional illiteracy is increasing even among those called ‘graduated’! Democracy is subservient to Corporatocracy. Money is now the new ‘free speech’!

    The ‘optimistic and enthusiastic’ folks you are talking are the exceptions and NOT the rule. Extrapolating that to a ‘new exciting new beginning’ is a bit premature. Living standards for middle class keeps declining ever since peak in 50s/60s.

    I hope you are right and I am wrong!

  25. spigzone says:

    Ruby Slippers Ritholtz …

    Fukushima is, and for several years will remain, one medium sized earthquake away from causing the evacuation of Honshu and spreading several Chernobyls worth of radioactivity across the northern hemisphere.

    That’s hard physical REALITY.

    Another hard physical REALITY is the oldest and most poorly designed and unsafe nuclear reactors are now being re-certified past their engineered lifespan. These are accidents waiting to happen and are also the complexes with the largest accumulations of spent fuel, some of them dwarfing the stockpile at Fukushima. It’s only a matter of time before there’s a Fukushima magnitude event on US soil.

    It’s the sheerest madness to be recertifying these reactors.

    What part of Declining Oil is so hard for financial types to grasp? That’s here NOW.

    NASA has been warning for years of the distinct possibility of a massive CME event occuring in late 2012 thru 2013 that has the potential to take out electrical grids accross the planet … for YEARS.

    Even without such an extreme natural event occuring global warming dictates increaing climate instability. This world IS going into a period of ever increasing wars and famines, shortages and insurrections.

    THAT much is already baked into the system.

    Another highly possible Carrington Event and civilization ends in a day followed by a nuclear poisoning of the entire planet as reators and spent fuel pools across the world run out of cooling water and go into uncontrolled meltdowns.

    That’s not ‘fearmongering’ … that a simple acknowledgement of hard physical REALITY.

    The hairless ape has proven no diffferent than any other lifeform throughout the history of this planet that finds itself without effective predators and abundant resources and then grows until it consumes it’s resources and then collapses. There is no difference in basic mechanism, only in the depth and breadth of destruction before the collapse.

    The most realistic ‘optimism’ in this situation is the acknowledgement mother earth will shrug off it’s ‘intelligent ape’ experiment and a million years from now will never know the difference.

  26. mwfadil says:

    It all depends on one’s perspective. Life is really good today and a lot better than it was 10-, 20-, and 30-years ago, not just for the 1 percenters in the US but for tens of millions, if not hundreds of millions of people in China, India, Brazil and many of the other developing countries. So, yes, the future is definitely not grim, but like always, there will be winners and losers.

  27. Jojo says:

    “And yet, as I look to the long term, I’m optimistic.”
    That’s only because you don’t yet Grok how much economic destruction is going to occur from humans being displaced by automation and robotics in the workplace. You can cover your eyes like the “see no evil” monkey but this trend continues to gather momentum with each passing month.

    And please don’t fall back on the straw men stories about how buggy whip makers and early workers displaced by farm automation and assembly lines went on to bigger and better work opportunities. That was a different time and place and is not comparable to where we are today – both economically and sociologically .

    Where are all those “innovative” new industries that politicians and talking heads have been touting over the years, which were supposed to spur economic growth and hire more workers? Even a technology of the moment like “cloud computing” will ultimately result in LESS IT workers needed.

    We have a much larger population now and an excess of people. There are simply too many people for the available jobs now, let alone the future.

    Long term, there is little reason to be optimistic…

  28. “…Other than that, I wonder why you would think that our incompetent, corrupt, and less than worthy leadership would be replaced by anything but more of the same…”

    you know, BR, ‘Petey’, above, makes a Fair Point..

    would you care to become, more, discursive, along the Lines that He is drawing-out?

    if “We” had learned, anything, from History, We should have learned that “the “Wh*res” never Ran the “Wh*rehouse”–at least, those of any repute..”

  29. econimonium says:

    Most of the comments here make me think of one thing: Plank’s observation that science progresses one funeral at a time. Take Dow’s comment: “Reality: natural resources are dwindling”

    Dow, what you mean is the natural resource sources that YOU know of are, not the ones we’ll be using in even 100 years. Do you think we’ll still be using fossil fuels 200 years from now? Do you think that science won’t discover other energy sources? That we won’t mine iron from asteroids or the moon? That perhaps we won’t get methane from one of Jupiter’s moons? I think Barry is talking about you when he says “old” which I interpret not as an age but a state of mind. One unable to reach for the stars and conceive of things beyond what we know.

    Did my grandfather think we’d all be using computers in our laps? Talking on cell phones? Running personal navigation devices? All in the space of 20 years, I might add? You think that people won’t figure this out, as they’ve figured out everything we use now? If you think that way, then you’re ready to die, quite frankly, and let everyone else make the future. Because I see all this and even more as we move forward. Current limitations are limitations of thought, not of resources.

    So for another old thought: lead, follow, or get the hell out of the way.

  30. techy says:

    Does somebody thinks what spigzone is saying highly improbable?? I am kind of freaked out thinking about all the money I need to start spending because who know what will happen in 2-3 years :) (but seriously can somebody please refute it, I am too lazy to start the research on my own :)

    I kind of feel foolish that I used to laugh at the doomsday preppers….I think they maybe right but I am not going to spend 100k building a bunker, I would rather say have fun while it lasts…no point in holding on to something so hard that you lose the present.

  31. ToNYC says:

    “Reality: natural resources are dwindling, the planet is grossly over populated with 2x as many people as their are resources to support them, and innovation isn’t going to save us because we squandered too many of those resources channeling everything into consumerism rather than basic needs. ”

    Reality: natural resources of some kinds are dwindling.
    Time to incentivize alternative entrepreneurs and require free-access library standardized and compulsory education instead of individuals being regulated by gover-no-doers.
    Retroactive tax credits for DOT-certified 20-yr CNG tanks. Build your own bi-fuel tio use $1.80 natty gas on the Santelli Exchange this weekend. A thousand year supply we are exporting to sell for $15 in euros and but that’s call it suckcess. Good for the Kochs sponsoring the green fract’n nonsense.

    The planet will never be over-populated with intelligent people. It’s the wealth-extraction paradigm through information-arbitrage at every turn of the screw that keeps plentiful the dumb supply that bites rather than creates.

  32. CaptainInsano says:

    When the entire market cap of Facebook is less than a single month of the Federal budget deficit, I’m not going to hold my breath that a bunch of kids making iPhone apps and other largely irrelevant tat are going to save the country. The poster who said that these young guns Barry’s meeting at these entrepreneurial confabs are the exception, not the rule, is totally correct. I’ve seen enough of this generation of coddled, self-entitled youth to know that if we’re counting on them to save the future, we might as well throw in the towel right now. It’s going to take a hell of a lot more than a few gung-ho kids to put a measurable dent in this country’s growth prospects with the systems (financial, political, educational, etc.) as broken as they are and with the albatross of multiple decades of accumulated debt from living beyond our means hanging around the nation’s collective neck.

  33. econimonium says:

    techy I think spigzone is off his medication. All of what he says is *probable* but so is a black hole wandering into our part of this lovely galaxy and eating us. Then it’s possible for the Vorgons to blast us all to pieces to build a space superhighway too I guess. I guess it’s also possible that aliens helped us build the pyramids (but why they missed out on giving humanity toilets that flushed is a real mystery of the cosmos).

    Once again it’s the “scared old white man” syndrome that seems to be in effect now. But the nice thing is give it enough time, people will go on, the world will get better in fits and starts, and they’ll be dead and their doom with them. This has been going on for eternity (read graffiti from the tombs of Egypt and forward) where old men say the world is going to hell and newer generations ignore them. Sometimes it seems better sometimes worse, but everything still marches forward. And always remember that, in the end, angry old men are dead. That, itself, is cause for rejoicing.

  34. spigzone says:

    Techy, I think Econimonium is off his medication equating the possibility of a black hole wandering into earths orbit with the possibility of a 7.0 or better earthquake occuring in the next three years in the most seismically active earthquake zone on the planet.

    Heh, whatever.

  35. SOP says:

    Spigzone, – Re. Ruby Slippers and Fukushima…

    “”The New Retirement” for Nuclear Power Plants”

    At the 44 US nuclear reactors that have already received license extensions, 60 is the new 40.

    …the operators of 20 US nuclear reactors — including some with licenses that expire soon — do not have sufficient funding for prompt dismantling.

    If these reactors can’t keep working, their owners “intend to let them sit like industrial relics for 20 to 60 years or even longer while interest accrues in the reactors’ retirement accounts.”



    While the “interest accrues”… time to have a discussion with the kids…

  36. techy says:


    I think I can refute the possibility of we being a sitting duck in the event of carrington event by saying that all the people in power will face the same fate as common men, hence they will take precautions to avoid the electric grid shutdown or they will shutdown the nuclear reactors.

  37. Sunny129 says:

    That ‘bright’ Future is occurring in front our eyes!

    Young entrepreneurs with fresh ‘ideas to save the World’ vs Old money/establishment(1%) interested in keeping the stats quo! Those ‘young ones’ have already been targeted and already marginalized. Rest of the Sheeple are immaterial!
    Sugar Daddies
    The old, white, rich men who are buying this election.


  38. SOP says:


    You might be right. Also, Barry might be very right – as others have noted, it depends on the definition of “long term” and on what comes between Now and Then.

    About the fixation on Substitution = this is like putting both hands in the monkey trap. There are limits for substitution and the extra complexity it generates.

    About your Model of the Future:

    How many people will participate (from what tribes, races and nations)?

    How many people (muppets ??) will it cost?

    How many of our “known” resources will remain when we get their?

    What will you substitute for a functional Food Chain ?

  39. Patrick Neid says:

    Your column Barry has been written every generation for 2500 years. Julian Simon has always lived. It is an entrenched bull market that everyone tries to call a top for. Personally I’ll get nervous when everyone agrees with you. No need to worry at this point.

  40. SOP says:

    On Substitution…

    The crack dealer says what?

    “We’ve started mixing helium with nitrogen so you still have the lifting capability, but they probably won’t last as they did in the past,” Falconer said.



    Cheech says to Chong, “Medical-Grade Helium” man!”

  41. whskyjack says:

    When I was in grade school we practiced duck and roll to save us in the case of a nuclear attack. I saw an old man take off his shoe and pound it on the table to get abunch of other old men’s attention, they told me that this man wanted to kill all of us and that he had the power to do so. He seemed crazy enough to do it.
    For a long time I assumed I would never reach 50 because some crazy old man would push the botton. So imagine my suprise when I looked up and here I was 50. Since then I have been very positive. After all I have over fifty years that prove the doom day folks are wrong all of the time.

    We as a country are truly blessed with an abundence of bright creative people, not only that but they are surrounded by teams that are dedicated to their success.
    The wife works for a small engineering firm and I see this all the time

  42. Malachi says:

    I found the post inspiring although I would have loved more specifics.

    Then I read the comments and that took the jam out of my doughnut.

  43. louis says:

    We use to have Kiss records and Arcades. What made it better was we actually rode our bikes outside and had some real adventures to get it. Your crazy to let your kids roam free in this Meth fueled suburbia now?


    I feel uptight on a Saturday Night.

  44. Through the Looking Glass says:

    Ditto to that piece Barry , I like the article I read about the Harvard economic major who turned down high paying jobs on Wall St that were offered to him to because he was a “best and brightest”. His take was hell no , I want to work with people with real jobs that actually make something and Wall St doesn’t do anything but move paper around. A useless occupation to him.

    Remember the ole “no one on wall st is getting prosecuted” Look what I found:

    I found this hard to believe after the Wall St happy ending holocaust. Some fuel for another article perhaps…..

  45. RC says:

    This is sort of of the east coast west coast thing like Barry points out. The east coasters are gloomy because the world of finance and politics still works on legacy and privilege. In the west coast you dont have to have played lacrosse in college and you dont have to be a newphew of xyz to make it. You just need an idea and willingness to work hard. BTW, there is no equal to this place anywhere in the world.

    It is amusing to read the doomspeak. It is astonishing that the doom mongers cannot see the natural gas revolution that is a once in 50 year event that we are in the first innings of.

    And oh BTW, BTU equivalancy would put price of oil at around $14 a barrel, and there is a WWII era process that can convert natural gas into Gasoline. The effective Oil barrel rate on that would come out still under $20 with present natural gas price. This is the natural gas revolution is all about.

  46. MG77 says:

    Magic technology innovation will somehow solve our issue regarding oil in the next 20 years globally! Fat chance. The U.S. could have made less painful choices 20-25 years, invested large amounts in exploring alternative fuels sources, and gradually phased over to alternative sources of fuel for transportation including electricity, natural gas, etc. Problem is that no party would possibly win an election on that platform with that kind of time horizon.

    Diesel (gasoline) makes the world go round and enables our current lifestyles in almost all facets. Figures from IEA and others simply don’t add up about diesel production and consumption especially in India and China through 2040. No oil won’t run out but that is a ridiculous point worth not discussing. The issue is that bringing on additional supply in meaningful amounts is becoming increasingly technology challenging in more extreme environments, economically costly, or in some cases requires large amounts of energy to get at the crude. All while existing production in a number of countries continue to decline & many next oil exporters are moving to oil importers. Happened to Britain in 2005. Mexico is well on its way and so are about a dozen other smaller countries.

    Our current global economic model requires really cheap and readily available diesel fuel to make it work & every increasing amounts at relatively lower levels to really drive future growth. We are like heroin-junkies that increasingly need a bigger and bigger fix to get that same euphoria/economic growth. Even when it becomes stalled out, we start to go through detox & climb the walls..

  47. bear_in_mind says:


    This reads like a Geithner screed… long on hyperbole and short on fact. Believe me, I want to believe all your proclamations will come to fruition, but do you have any FACTS or DATA to support your projections? Without them, this is much closer to propaganda than analysis.

  48. RC says:

    The issue is that bringing on additional supply in meaningful amounts is becoming increasingly technology challenging in more extreme environments, economically costly

    Probably you did not read about abundant natural gas very cheaply available in the US. The natural gas can replace Gasoline and/or Diesel very easily. The price of energy around the world is on its way to plunge due to this.

    This whole India China canard (when it comes to use of Oil) is getting silly. India has less number of cars than the state of Texas.

  49. markk213 says:

    I think what’s missing here is the focus of where all this new entrepreneurship will take us (and them) going forward. I get the sense there’s a lot of technical expertise being applied toward exploiting niches in the system and generally making things run more efficiently by developing various programs, apps., etc. for all kinds of rapidly evolving hardware devices and other technologies. But, the more automated the system gets, the less humans have a function in it. Maybe tech behemoths like Amazon, Google, Apple, etc. have mythologized the ‘big idea/instant riches’ story to the point that many now underestime the true long term struggle, competition and level of commitment involved in bringing an idea to fruition and making a decent living. Makes me wonder what our society will look like in the future and how expansive opportunities will be to pursue a meaningful and economically secure future for everyone.

  50. SOP says:

    RC, – re Natural Gas and ChinIndia

    It sounds like you get your Data from the MSM and from financial/econo blogs.

    Your misunderstandings will remain until you make the effort to get past the cliches and industry PR.

    But… then… you will have to deal with reality.

    (it is hard being an adult… in the land of Adult-Sized Children)

  51. CANDollar says:

    Another reason the future is not grim is that people world wide are living longer.

    People who expect to live longer have “more skin in the game” of life and so favour optimistic scenarios.

  52. CANDollar says:

    Younger people grow up with their nervous systems extended by electronic networks with most world experience as non-corporal (not from the body moving through space but through the mind moving through a cyberspace).

    For those who have also from an early age have deep corporal experience such as trolling of city streets, face to face social interaction, complex emotional conundrums, leadership opportunities, fine motor tinkering and experimenting with the basic chemistry, physics and mathematics of the world, sports, and even long camping trips the extension of the nervous system through networks can be a boom.

    For those without deep corporal experience there can be an illusion of “smarts”. Also digital technology often presents the world in fantastical simulation which can lead to misapprehensions of physical reality. I think there may be many young people who lack basic “street smarts”, emotional intelligence and knowledge of the physical world because they have spent 8-10 hours a day for a decade or more looking at screens small and large rather than moving through space and interacting with people.

  53. Dow says:

    People who expect to live longer have “more skin in the game” of life and so favour optimistic scenarios.

    Just like Wall Street self-regulating itself…what could possibly go wrong…

  54. SOP says:

    CANdollar – Re. optimism vs pessimism

    Can’t we leave that playground for the children, politicians MSM and financial bloggers blowing smoke?

    Do NOT judge based on smiley vs sad face buttons.


    TO: You paint such a hopeless and pessimistic picture…

    TP: No, I don’t. No, I don’t.

    I’m just trying to be realistic, you see, the thing again – since we have a very loose relationship to the truth and reality, we are unwilling to face reality, instead we are telling lies to one another, right?

    We call it optimistic and positive attitude, when somebody’s trying to tell you the truth you call them pessimistic and a dark picture.


  55. econimonium says:

    Whenever I read stuff that begins with “Younger people grow up with…” I think of some old codger on his front lawn with a hose yelling “Damn kids get off my lawn!!!!”

    Honestly most of the commentors in this thread must be a joy to be around….but only if you have an unlimited supply of Paxil. Trust me, the human race will be going strong long after you’re not. Tis the way of the world.

  56. dsawy says:

    I see a declining rate of innovation in electronics and computer engineering since the Internet became ubiquitous. I can’t explain why, but compared to the rate of fundamental innovation in the EE field(s) from 1900 to about 1995… what we’re seeing now pales in comparison.

    Consider that, from 1900-ish to 1950, we went from:

    Spark gap transmitters, to vacuum tubes, to CW, then AM modulation, then FM, then SSB, then we invented the computer, the transistor, television, radio-teletype and other early digital modes of transmission, magnetic storage of signals, computer memory, etc… huge advances in fundamental physics and engineering of electronics…

    From 1950 to 2000, we went through the solid state revolution in electronics, computers, computer programming languages, computer networks, a revolution in microwave RF theory and engineering, a huge decrease in the cost and size of computers making them ubiquitous in most all areas of industrial process control, CNC machining and all manner of productivity multipliers… a realization of spread spectrum modulation in small embedded systems…

    By comparison, the last 10 years of supposed innovation? Facebook, Groupon and other such nonsense? Sorry, it doesn’t measure up. Crunching gate pitch from 30-odd nanometers down into the low 20′s? Not a huge leap forward. We knew it would happen some day. There’s nothing revolutionary about that, merely evolutionary.

    The only field in which I see a rapid rate of innovation is in life sciences.

  57. Jojo says:

    @dsawy – that has also been my contention. I keep asking as to what scientists (not just in the USA, but aggregate worldwide in every country) are doing with their many billions of dollars and time? Because we aren’t seeing much from this mass of brainpower and dollars spent.

    It still takes huge chemical rockets to get off the Earth, hair still turns gray (and people go bald!), we can’t regrow limbs yet, haven’t cured cancer, can’t beam sun power down from orbit, fusion power is still 20-50 years away (depending on who you believe), we still don’t know how the brain stores data, etc., etc….

  58. [...] a veteran financial blogger and commentator, delivered another cheery prognosis last week and again yesterday based on the unassailable thesis that America and its financial markets will be just fine because [...]

  59. HEHEHE says:


    I’d feel much more comfortable being long here after reading your article if the S&P were in the 800-900 range than I am with it trading where it is now. I do not believe our country’s future is bright but relative to Europe and Japan I would say we aren’t in the worst shape.

  60. Francois says:

    Old Rob wrote:
    “No the younger generations will always have great earth-shaking ideas, but when they have to survive or the economy goes against them, things become practical in a hurry.”

    Practical? In what way? As in bending over to the existing order? Or deciding that the existing order has got to go?

  61. Francois says:


    May I suggest you listen to 2 great interviews:

    1) One with historian Tim Snyder on the last work of Tony Judt Ill Fared The Land: http://www.radioopensource.org/tim-snyder-and-tony-judt-another-narrative-for-campaign-2012/

    2) Prof Daron Acemoglu, author of Why Nations Fail

    Both are cautiously optimistic about the future of the US. The nice features of these interviews are, first, the lack of rose-colored glasses sugar-coating bullshit that is all too frequent in the MSM and second, a careful avoidance of the “OMFG!! We are so doooomed” mindset, so dear to the perma-catastrophistas.

    That siad, I sure hope your assessment is the correct one. The alternatives are pretty ugly.

  62. Francois says:

    Awesome! Now I forgot to put the link to the 2nd interview.


  63. jbay says:

    At another level I’ve never understood the small mindedness of how everything is done. We have the technology to build things that solve all the problems but justify not funding these things because we don’t have enough green paper to pay someone to build it. Meanwhile we have a real youth unemployment of 20%. We have the technology to automate every task accept maybe sales which, in the grander scheme of things, I’m not really sure we need. Why do you need to tell me I have to buy this?

    why as a species are we wasting our time fighting over things when we should be creating art, solving problems and building a sustainable renewable ecosystem for ourselves? No I’m not talking about being a vegan because cows produce ethanol and are unsustainable. I’m talking about capturing the ethanol, automating the process and have your cake and eating it too. All very possible. I’ve heard it said that we’re on the verge of figuring out what causes death and illuminating it but we can’t all drive hydrogen cars with hydrogen produced from a photovoltaic sell on our roof tops?

    I seriously don’t understand the small mindedness of man. I guess that makes me a curiosity that doesn’t belong here.

  64. jbay says:

    In 1847 there was a whale oil crises and people thought ground oil was worthless. In 1849 Abraham Gesner converted tar to kerosene. In 2010 a positive energy was created from Fusion and in about 5 years that fusion process should become sustainable.

    There are a lot of negative people commenting that there is no knew technology which is complete hog wash. Fusion, nanotechnology, 3d printing…. on and on and on. People my age 28, are sending salmonella into low earth orbit and finding out its virility is increased because space simulates ganglia of the small intestine, there engineering viruses that target cancer cells, there creating fuels from algae. People like myself are automating everything. Others are creating plastics from grass. The list of research, experiments and new things being invented in just the last 2 years goes beyond being able to mention in a blog post. New laser telescopes are allowing us to see smaller. Smart phones as they are today operate by sensing your electricity. That is a new invention. I mean I really can’t bring up all the cool experiments going on right now for lack of page space: go read something troglodyte!