Several readers have complained that the Financial Post interview links on the far right of the Juggling Dynamite page have stopped working the past couple of days. We are trying to get to the bottom of this glitch. In the meantime both Part 1 and 2 of my interview video can be seen here on the FP web site.   more »

Reality is always evolving but we humans are reactionary, backward looking creatures. Perhaps to cope with the stress of change, we commonly exert mental gymnastics to justify and bootstrap the status quo. We are all vulnerable in a tendency to see the world as we wish it to be. And so, we can easily see that other people have chubby children, but overlook the poor physical condition of our own. We can see that other cities or countries may have over-valued housing markets, but deny it in our own. We can see in retrospect that tulips and technology were clearly “crazy financial bubbles” and yet argue to justify present day stock and commodity prices. Human behaviour is remarkably consistent in this; has been since time began.

For the past 5 years, much has been celebrated about the incredible connection of our “globalized economy". Worldwide efforts to jump start consumption were ultimately successful after 9/11, thanks to rate cuts which pushed global borrowing costs to 50-year lows and financial innovation like credit derivatives, and consumer appetite for debt, to multi-decade highs.

Today we are now cleaning up from the spending orgy that was. After years of madness the average consumer is quite literally "spent" and suffering the predictable aftermath. Bankruptcy and foreclosure rates are surging all around the world. Housing values are stagnating and falling all around the world. Economies are slowing and contracting all around the world. Recently the International Monetary Fund (IMF) forecast that global GDP which has grown at a truly awesome 4.9% annually 2002-2007, would fall back in line with its 45-year growth rate of 3.7% in 2008, and bringing the global economy to a .7% hair’s breadth above the 3% needed to avert global recession.

Spurred by voracious, seemingly insatiable, consumption this cycle, commodity prices over the past 8 years have doubled many times over.

But this is all to speak of what has been...   more »