The Glory of a Minute

"The greatest shortcoming of the human race is our inability to understand exponential growth." —Albert Bartlett, a physicist

On Friday, I drove an hour north to pick up my boys from college for winter break. When I arrived, they were still packing. Amazed by how much stuff they were bringing home, just for three weeks, I suggested we go to lunch first, because I was hungry! Not unusual for me.

As a mother of two very smart engineering students, I struggle sometimes to find things to talk about other than classes, girls, news, or TV shows. I've never been someone who enjoys small talk. I like to talk about deep topics that challenge me and others to think. I take my life way too seriously sometimes, but I'm trying to have more fun with it. So I posed a question to them that I knew they'd both find enjoyable and challenging.

Okay here goes... "At 11PM, there's an aluminum box with one bacterium that doubles every minute. At midnight, the box is full of bacteria. At what time is the box half full?"

Their eyes lit up.

"That's an exponential problem," said Leo, while Gabriel pulled out a piece a paper and started putting together the formula and math.

I got up for a few minutes to get some more food, and came back to the table..."Well, what do you think? Do you have an answer for me?"

"11:30," Gabriel said.

"No," I replied. "You're making it more complicated than it is...THEY DOUBLE EVERY MINUTE. Think backwards."

Leo interjected, "11:59!"

"Yes!" I said.

Gabriel looked puzzled. "No, that can't be..."

That is, in fact, the answer. One minute before midnight the box is half full, or half empty, no matter how you look at it. I'm reading a book that used a similar example to demonstrate the U.S. debt. Every president that comes into office doubles the debt of the previous president. Unless you believe that debt is infinite, then this is the only fact that really matters when it comes to deciding what to do with your dollars today. The question is not IF the box will ever fill up, but WHEN the box (holding the debt) be half full. From that point, you have only a minute before it breaks open and spills out, making a big mess. Without knowing when the box is full, however, we cannot do the math.

It won't matter that Time named Trump the person of the year. It won't matter that Bill Ackman is very bullish on America. It won't matter that the Texas House introduced a bill to establish a strategic bitcoin reserve. What will matter is that to mine one single Bitcoin "consumes" a greater amount of energy than one hundred average US households consume in a year. What will matter is that one Bitcoin transaction is equivalent to about a month of electricity for the average US household. As Bitcoin grows, energy "consumption" grows exponentially. Note, I said CONSUMPTION, NOT PRODUCTION. If you believe in infinite cheap energy fueled by infinite free money and debt, then all the power to you! No pun intended. :)

According to the International Energy Agency's latest Electricity Report, AI already uses as much energy as a small country, not to mention, the mining, production, and global transportation of all the hardware that goes into building and maintaining such a GARGANTUAN infrastructure. For some reason, the media isn't hyping Yale University's As Use of A.I. Soars, So Does the Energy and Water It Requires... Generative artificial intelligence uses massive amounts of energy for computation and data storage and millions of gallons of water to cool the equipment at data centers. Now, legislators and regulators — in the U.S. and the EU — are starting to demand accountability. But go ahead and follow the hype, if you want.

My sense and warning is that people are confused. People have mistook the media, and fear of missing out, for God's divine blessing. And people have misread problems as solutions. As history demonstrates time and time again, populations always get fooled while they think they're getting rich. Today is no different. People have piled into Bitcoin and AI, the two largest energy compactors on the planet. This isn't even to mention that their hardware wears out relatively quickly, and those parts are becoming more and more expensive by the minute. Inflation is the end game, and inflation is nothing more than the devaluation of currency.

But here's another question. If energy is money, and it is, then how do you hold energy's value with the very thing that consumes the most energy? It's not a trick question, I promise! Michael Ruppert made it crystal clear that energy, not money, is the root of all economic activity. A piece of gold and silver does not consume energy today. On the contrary, it stores the economic value of energy that it took someone to pull out of the ground when you bought it. A Bitcoin consumes resources and energy simply by existing on a blockchain. When exchanged, it also consumes resources and energy, much like a human being consumes food and water to survive, but exponentially more. If Bitcoin grows in its usage, then the financial system consumes energy (and resources) exponentially. So how is that a store of value?

Now, another mental exercise. You have a time machine, and you're back in 1920, one minute before New Years Day. When the clock strikes midnight, your time machine returns to 2025 with or without you, so you have to act fast. People are dressed differently, there's no computers, Internet, or cell phones, and one ounce of gold is worth $20. Someone hands you a $20 bill. You have a chance to put either that $20 bill in your pocket which you will take out in 2025 or exchange it for a one-ounce gold coin for which you will do the same. Which do you choose? If you want to be wowed, then get a cup of coffee and read What $20 Could Buy You Through History. This is fun article because it goes back to the Colonial Era.

We tend to think we are wiser now than our ancestors, but the truth is we are far dumber. The Gilded Age, both the history and the show, is a fascinating period of wealth and inequality in US history. Rapid industrialization from the late 1870s to the early 1900s fueled a striking wealth divide, and a societal shift from agriculture to industry where people moved from the land to the cities to make more money. The term was coined by none other than Mark Twain and Charles Dudley Warner in their book, The Gilded Age: A Tale of Today. This is, indeed, a tale of today, as "the gilding of economic well-being" refers to a superficial prosperity which covers over real poverty. Imagine a thin layer of gold (gilding) paper covering an aluminum box with nothing in it but shredded IOUs.

As with all cycles, and time machines, they bring us back to the past. Not exactly, but close. While our progress and finances appear to be linear, growing exponentially higher without end, we must understand that life and everything in it is governed by cycles. No man and none of man's tricks can change this fact. Just unwrap the gold leaf paper on the aluminum box and open it. Not Trump, not Biden, not Harris, not Obama, not Clinton, not Bush, and not the smartest person you know has the power to change what's in that box. All they have the power to do, with the help of the media, is make you imagine there’s something wonderful inside. This works until its unwrapped and overflowing with shredded financial paper. If we had only known the minute.

My blog posts are published every Sunday, and they're free for anyone to read and share. If you would like to support me financially in this weekly process of thinking and writing, I'd be most grateful. For this reason, I started a Wendy Williamson Patreon page. If Patreon isn't your thing, you can send a one-time gift via Paypal to me@wendywilliamson.com. Thank you!