GMO co-founder Jeremy Grantham believes that while the global economy is displaying some of the classic signs of collapse endured by previous civilisations, there are two potential redeeming factors that could yet save us.
Grantham says that combined with some luck and better leadership, declining fertility rates and the rapid strides being made to generate alternative energy sources might stop the world from collapsing.
Aversion to bad news
Grantham is concerned by what he calls an 'aversion to bad news' displayed by investors, and human beings generally, saying they prefer to hear optimistic views, no matter how facile, and bury their heads in the sand.
In GMOs latest quarterly outlook, Grantham argues: 'People, especially investors (and, I believe, Americans), prefer good news and wishful thinking to bad news; and that there are always vested interests to offer facile, optimistic alternatives to the bad news. The good news is obviously an easier sell.'
'Good news in investing in particular is better for business; good news on resource limitation is better for the suppliers of resources; and good news on climate change -that it does not exist and is even a hoax - is better for energy companies, among the biggest and most profitable of all companies.'
While he describes the global economy as locked in 'the race of our lives' and it being a 'damn close thing', declining fertility rates and alternative energy will ultimately act to stop us self destructing.
Grantham points to Asia, where China, Japan, Hong Kong and Singapore have all seen dramatic falls in population in recent years with many families actively choosing to have less children. The same is true of many emerging market and developed world countries too.
'The most obvious drivers of lower birth rates, though, are the improved education of women and advances in birth control methods. The net effect of these factors is a change so profound that just a hundred years ago it was not even guessed at, and indeed population growth and fertility continued to rise until about 1960 - just the other day.'
While Grantham adds the caveat that some African countries are continuing to see their birth rates rise, the overall decline in fertility 'is our last best hope, both from our civilisation's point of view as well as for the well being of all the life on our planet.'
Grantham added: 'The ruinous alternative is to have an ever-growing population run off the cliff collectively. The economics industry has indeed done a a particularly inadequate job on long-term sustainability in a world of finite resources. It is a good time for them to wake up to the problems we face on this front.
In terms of technological developments in the energy sector, Grantham is encouraged by strides being made to reduce our energy consumption, and to make energy use more efficient.
'For once, all of the innovations, corporate start-ups, and risk taking - the best part of the capitalist system - work to decrease our use of depleting hydrocarbons and therefore to increase our chance of stabilising our civilisation before the cliff edge is reached.'
'We have the time, technology, and money to completely replace non renewable energy in 30 to 50 years and on average, and in that time period such replacement will be economic.'
Clean Chinese energy plan
Grantham has high hopes of China setting a 'brilliant example' on renewable energy after a raft of data pointing to record levels of pollution in a number of cities.
Grantham calls on the country to announce a 25 year program of alternative energy 'that embodies a Manhattan project level of commitment' rather than the current 'paltry' five year plans.
He cites the huge increase in production of solar generation capabilities in China as a step in the right direction.
'In a world lacking US leadership in energy sustainability, a truly major Chinese effort might be the difference between collective global success and failure. In this case it would be the Chinese cavalry heading us off at the cliff edge, but I'll take any cavalry we can get.'