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The foundation of the world economy is built on energy. And if you believe that the economy is structured in such a way that it needs to grow continually in order to survive, then it will take an endless supply of energy to feed it.

But what happens to that equation when the net amount of energy we extract from the earth is shrinking? How, then, does an economy grow exponentially forever if the one element it needs more than anything to flourish is contracting with time?

Well, in the mind of Chris Martenson, it creates a moment when it's vital to challenge existing orthodoxies about the way the economy, debt and capital markets work, and to think about how wealth is accumulated, more generally.

Mr. Martenson is a trained neuroscientist who in recent years has turned his attention to the economy, particularly as it relates to dwindling energy resources and growing debt. His view of the future isn't particularly rosy. Once a young, rich executive of a Fortune 300 company, Mr. Martenson divested himself of most of the trappings associated with success in the U.S., moved to the country and started growing his own food.

He also got rid of most any equity stocks and put his money in gold and silver. He has been labelled a prophet of doom and a survivalist, by some. But more recently, his views have been receiving wider and more serious attention. He has been to Canada to talk to oil and gas investors, of all people. That's incongruous given his view that we're pillaging the Earth of its energy resources in the most inefficient and wasteful ways possible.

And this is not a good thing, considering there is not an infinite supply of that energy we're ripping from the ground. At some point the unsustainable hits the moment of won't. Mr. Martenson's case is compelling and, as you'd expect of a scientist, based on mounds of data.

In decades past, we got 99 barrels out of the ground for every barrel we used in the extraction process. By the 1970s, that ratio was down to about 25 to one. But when you look at the Alberta oil sands and other similar fields, that percentage is closer to three or five to one. "That's a whole different proposition from what we were getting in prior decades," Mr. Martenson said in an interview. "Net energy [resources] in the world [are] shrinking. That is a fact."

Macro data show that from about 2005 to today, world oil and exploration development budgets have more than doubled – from $300-billion then to more than $700-billion today. You would think with budgets more than doubling there would be a commensurate increase in oil-production output.

"But in fact," Mr. Martenson said, "It has been stuck in about a five-per-cent production band across that entire period."

In other words, we're spending more and getting less. Meantime, we're ignoring obvious ways to conserve energy – solar panels, anyone? – while continuing to find ways to get energy out of the ground as fast as possible and ship it off for dwindling profits. And, there is no planning taking place for that day, 50, 60 years down the road when our conventional energy supplies are nearly depleted.

Mr. Martenson is also worried about the massive debt the developed world is piling up, an accumulation being made against the bet that we can grow our economies out of the problem. "We're talking about debt to income across the developed world of 350 per cent," he said. "That's extraordinary. We've never seen debt levels like it."

He said it's an experiment that began around 1980 and has continued ever since: debt increasing at twice the rate of underlying income. But Mr. Martenson believes economists who support this course of action and the notion of infinite economic growth need to answer the question: How does that occur with dwindling energy supplies?

At some point, he insists, those debts are going to have to be destroyed in some way. Is that process inflation or deflation? He doesn't know. But when it happens, it will not be pretty and we are already seeing microexamples of it occurring in places such as Detroit.

Mr. Martenson, meantime, is buying up productive real estate; land you can grow things on. Just in the case the world does indeed go to hell in a handbasket.

Follow me on Twitter: @garymasonglobe

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