Bank of America Merrill Lynch Global Research has a group focused on “thematic investing”. These are trends, developments, and problems with a high probability of occurring that could also become interesting opportunities, although not fully realized today. This group writes fascinating reports on a wide range of topics. Their most recent 135-page, fully documented report is titled, “The World Is Not Enough – Scarcity Primer”. It is concerning to say the least. The report begins, “We will need 2x Earth’s resources to keep up with the current usage rate by 2030. Today less than 1% of the planet’s water is fit for human use and we could run out of freshwater by 2040.” There are 10 themes in the report, below are bullet points from some of them that are relevant to this blog. It’s not a happy list.
- By 2030 based on current trends we will need 2x the Earth’s resources to keep up with demand
- If you compare Earth’s history to a calendar year, then humans have only existed for 37 minutes but have used 1/3 of the planet’s entire natural resources in the last 0.2 seconds
- 99% of the stuff we harvest, mine, process and transport is trashed within 6 months
- In 2020 for the first time in history the weight of human-made stuff exceeded that of natural biomass
- Out of the total weight of mammals on the planet: Livestock = 60%, Humans = 36%, Mammals in wild nature = 4%
- Every second one football field of forest is cut down on the planet
- 70% of Earth is covered in water yet less than 1% of this is drinkable or available for human use.
- …at the same time water is the most ‘traded’ commodity in the world where ‘virtual water’ trade is 400x bigger than oil
- The megadrought in the US West that begun in 2000 is now the worst in 1,200 years and could last till 2030
- 57% of the world’s freshwater aquifers have passed their tipping points and 15% of US fresh water is wasted every year because of pipe leaks
- The planet will need to produce more food in the next 40 years than all farmers have harvested in the past 8,000 years
- Every year air pollution kills more people worldwide than AIDS, malaria, diabetes, or tuberculosis and 100 million years of lives are lost
- If you live in the West you use 57kg (126 lbs) of newly mined minerals extracted from Earth every day including metal, fossil energy, minerals
- Mismanaged waste dumping kills up to 1 million people globally every year
- Humans have manufactured enough plastic since WWII to cling-film the entire surface of the Earth
- Only 2% of global plastic packaging is effectively recycled, and 0.9% is effectively recycled twice
The point of the report is to cause alarm, but also to point to potential investment opportunities. I hope that capitalism finds solutions to these issues (and the others covered in the report), but it is a daunting list.
Of course, here in Central Oregon, water continues to be managed under the assumption that in the near term we will return to “normal” conditions despite scientific evidence to the contrary.