Prices, costs, and markets were never devised to tell us how we’re doing in a world in Compression, and effects may take years to become so severe that no one can mistake them.
The obvious indicator is energy prices. Petroleum spot prices of $60-$90 a barrel seem normal now. As oil becomes harder to obtain, one can expect its price band to slowly rise. Supply-demand burps map into only $20-30 a barrel variances, but if terrorists suddenly, say, blocked the Strait of Hormuz, oil prices would race toward $200 a barrel overnight. Industrial economies would suddenly invoke allocation schemes (rationing). Such scenarios are easy to concoct; terrorists can devise them too.
More subtle is global monetary systems sputtering to prime growth that won’t take off. The financial bubbles and faux market scams of the past decade may be early indicators of this effect. In the absence of strong policies to offset it, one would also expect a skewing of income and purchasing power to a smaller upper class. Those with money enjoy increasing use of resources, while most others, relegated to Wal-Mart shopping status, try to buy as cheaply as possible. That’s a system running down into commodity traps.
Unfortunately, expansionary economic thinking is apt to regard this development as a social fairness dispute, easily understood and easily inflamed, than as a sign that something more fundamental needs attention.