Bill Bonner

Yesterday was the first day of spring in the US. But it isn't springtime here in Argentina, where we've just arrived. It's fall. The leaves have begun to turn yellow and brown in Buenos Aires. The air cools. And at night the earth, like a sleeping drunk, gives off warm, humid gases.

In Florida, we caught up with an old friend:

'This global warming stuff is crap. The real driver of temperatures on the surface of the Earth is not the 'greenhouse gases.' It's the sun. We get all our energy from the sun. And when solar activity decreases, so do temperatures.

'That's how solar scientists were able to predict, 10 years ago, that the winter of 2013-14 would bring record cold to the US. But nobody listened. Everybody believed this global warming fraud.

'By the way, I went out to California and I advised [a well known investor] to go long natural gas. He made millions on the trade.'

Our friend is writing a book on the very subject we take up today: how the debt bubble ends.

'Climate has a much bigger effect on economies than people realize. I was reading a Russian analyst the other day. He explains how the big moves in world politics - things such as the French Revolution and the fall of the Roman Empire - have been triggered by cold weather.

'The reason is fairly obvious. We live on energy surplus. It's the difference between how much energy we get and how much energy we have to expend to get it. That applies to food as well as gasoline and every other form of energy.

'Back in the old days, the margins were fairly tight. Less solar activity meant lower temperatures and a smaller harvest. It also meant starvation... which made people rather cross.

'People don't realize it at all, but today's margins aren't that high either. That's why central banks are keeping interest rates so low. At higher rates, for many companies, households... and governments too... the margins disappear.

'But as it gets colder... margins shrink even more. People spend more of their incomes on staying warm. And the price of food tends to go up.'

We are on the subject of how the world ends... at least the world created by ZIRP and QE. And economists who don't know what they are doing. This is a bubble world. And the biggest bubble is in debt.