We told you so. We forecast the financial-economic collapse in Asia in 1997, and the devastation of Russia over the 1990s. We documented layoffs and shutdowns in countries like Mexico. All of this has now come to the United States. With its arrival in the U.S. we've come to a new stage: The looting process is imploding. That's now manifest in the U.S.: The importer of last resort can no longer import. The bailout of LTCM and related events have led to hyper- inflation. Rollovers required the issuance of more paper than that which was due! As we tell people about this, they agree about the past, but continue to disbelieve what we say about the future! "THEY will solve this," or "Yes, it happened, but that was because of X." The real issue is, people have a problem understanding the nature of physical economy, and that the human universe is subject to forecast. People think its all percussive physics, that is, they suffer from determinism or fatalism. Alternatively, they think that the universe is arbitrary, or at least that its lawfulness is unknowable. The solution to this problem of {understanding} is key to solving the problem itself. Man is not a piggy, and the world is not a market--so there is no need for "this little piggy to go to market." U.S. derivatives now total about $89 trillion, or 2/3 of U.S. financial aggregates. The current growth rate is about 30% per year. World financial aggregates today total $400 trillion, of which at least $280 are derivatives; the current growth rate is again 30%. By comparison, the foreign indebtedness of the third world is only $4.5 trillion. Third world foreign indebtedness was only 6% of the total bubble in 1980, and at that time, it was the only part of the bubble that was blowing out. In 2000, the foreign indebtedness of the third world was less than 1% of the total bubble, and every aspect of the bubble was blowing out. Think of this in evaluating proposals from Jubilee 2000 and other such sources! World foreign debt (official) in 1999 was $2.5 trillion, but non-official debt brings it up to $4.1 trillion for 1999. The original debt has been paid two and a half times ALREADY, but current debt is now seven times the original level. The solution proposed for this problem? Globalization--that is, privatization and deregulation. Between 1987 and 2000, there were privatizations worth $400 billion, and the money governments received from these sales left their countries immediately. This $400 trillion is the cause of the hyperinflation. The states of the U.S. are being told to privatize and deregulate. The result is typified by the case of electricity in California. By deregulating and privatizing, newly created middlemen have been able to corner the market, and to burden the price of electricity with speculative debt. It is not supply and demand that determines price. Only reregulation will keep this cancer out. [At this point, Dennis reviewed the doctrine of the determination of prices by the intersection of supply and demand curves, the concept of elasticity of demand with respect to changes in price, and the indifference curves that lie behind the demand curves, drawing on that familiar repository of economic wisdom, Paul Samuelson's undergraduate textbook entitled {Economics.}] According to the theory, the consumer is always consider the tradeoff between using his money to buy more of X, or more of Y. The tradeoffs that people actually make between, say, buying more electricity and, say, buying more Pokemon games, are supposed to be captured in indifference curves. But this example exposes the severe limitations of this felicific calculus. Well, OK. Let's test all of this empirically. The price of oil plummeted a couple of years ago. There was a 52% drop between 1996 and 1998 in the world price of oil. The theory predicts a steep rise in supply, but in fact, there was only a 6% rise in supply. Next, the price went up 120%, but, instead of this price rise correlating with a big decrease in volume, volume actually went up by 2%. In another example, the price of natural gas went up dramatically, while supply remained flat. Between May 2000 and December 2000, the price of California electricity rose 700%. Supply dropped a microscopic 0.15%. So much for Samuelson! What is the state of the world? Between 1990 and 2000, there has been a 10% collapse in grain production in the third world and the CIS nations taken together (that is, the Less Developed Countries, LDCs). In the CIS nations alone, in the same period, there has been a 26% collapse of electricity production. Don't use global aggregates, because global income is becoming more skewed. So global figures mask the process. In the mid-1990s, in Africa, 75% of the population lives on $2 per day or less. In South Asia, the figure is 70%, in East Asia, 70%, and in Ibero-America, 50%. These are mid-1990s figures. Today the situation is FAR worse. This means potential relative population density is LESS than the current actual density. The implosion is being caused by a high death rate, decline in life expectancy, and decline in the physical and cognitive quality of the population. Much of the world is also exporting its population. Mexico exports 12% of its labor force to the United States. There are therefore two types of world population. There are societies in which population is growing anti-entropically. But there are also entropic societies which MAY experience growth by looting their neighbors. But can societies grow anti-entropically indefinitely? Necessity is not the mother of invention; rather, invention is the mother of necessity. See Plato's Timaeus on the genesis of the world. The eternally invariant is apprehended by cognition. But that which is coming into being but never exists, is apprehended by opinion relying heavily on sense perception. Plato says, "God created the universe as something good." That is causation. "There is nothing better than that which has mind and therefore soul." He put mind inside soul and soul inside body, so he might produce as perfect a being as possible. Note that mind is the higher ordering principle. These same ideas also appear in Cusa's dialogue, The Layman About Mind, and in Leibniz. Now comes an interesting change in the Timaeus. "The Composer was very happy with his creation. He loved it. He conceived a plan to make it even more like himself." So what did he do? He created {time} as the moving image of eternity. Think how man sees his development in time. "Reason rules over necessity by persuading her to drive the greatest part of the ephemerals toward what is best." Reason rules over necessity. Since invention is the mother of necessity, man is the crown of creation. So: we are not piggies and it is not a market out there. It is time for a change.