1 00:00:05,841 --> 00:00:08,051 (suspenseful music) 2 00:00:10,345 --> 00:00:13,432 - Gee-whiz. 3 00:00:13,474 --> 00:00:15,058 - When I was a kid, I was pretty sure 4 00:00:15,058 --> 00:00:18,145 I knew how the world was going to end, 5 00:00:18,187 --> 00:00:19,813 alien invasion, 6 00:00:22,316 --> 00:00:23,817 giant lizard attack, 7 00:00:27,112 --> 00:00:28,614 or zombie apocalypse. 8 00:00:32,618 --> 00:00:34,995 And even though some people are still convinced 9 00:00:35,037 --> 00:00:36,580 that Godzilla, flying saucers 10 00:00:36,622 --> 00:00:39,541 and the body snatchers are on the way. 11 00:00:39,583 --> 00:00:43,003 Today, there's a more immediate apocalyptic threat, 12 00:00:43,045 --> 00:00:47,090 the potential disappearance of a crucial global commodity 13 00:00:47,132 --> 00:00:49,802 we rely on in ways we don't even realize, 14 00:00:49,843 --> 00:00:54,097 one specific commodity that's so important, so ubiquitous, 15 00:00:54,139 --> 00:00:58,811 nearly everything in the world depends on it. 16 00:00:58,852 --> 00:01:01,146 And if our supply were to ever run out, 17 00:01:01,188 --> 00:01:06,443 the global economy would grind to a halt. 18 00:01:06,485 --> 00:01:08,403 I bet you think I'm talking about oil. 19 00:01:09,905 --> 00:01:11,365 Think again. 20 00:01:11,406 --> 00:01:14,076 This is the rubber episode. 21 00:01:19,122 --> 00:01:23,293 Whether you like it or not, we're all connected by money. 22 00:01:23,293 --> 00:01:26,964 I'm Kal Penn, exploring this giant beast 23 00:01:27,005 --> 00:01:29,550 that is the global economy. 24 00:01:31,093 --> 00:01:34,096 (upbeat rock music) 25 00:01:44,982 --> 00:01:48,235 To truly appreciate how much we rely on rubber, 26 00:01:48,277 --> 00:01:51,572 I need to get a taste of it in a monster dose. 27 00:01:52,614 --> 00:01:54,283 [Kal] Philadelphia, 28 00:01:54,324 --> 00:01:57,786 this is Monster Jam! 29 00:02:08,130 --> 00:02:10,757 Monster Jam rolls on mammoth tires. 30 00:02:14,678 --> 00:02:16,388 And nothing else but natural rubber 31 00:02:16,430 --> 00:02:21,101 can handle the impact of those sick monster truck jumps. 32 00:02:25,647 --> 00:02:28,066 Besides tires, rubber has crammed its way 33 00:02:28,108 --> 00:02:31,403 into just about everything, from the clothes you wear 34 00:02:31,445 --> 00:02:34,281 to the items around your house and beyond. 35 00:02:36,033 --> 00:02:39,036 Rubber lets you bounce in this super fun thing. 36 00:02:41,538 --> 00:02:44,541 And these super fun things. 37 00:02:44,583 --> 00:02:46,585 Yeah, that's a whole different kind of bounce. 38 00:02:48,754 --> 00:02:52,341 Natural rubber is a $26 billion industry. 39 00:02:52,382 --> 00:02:55,177 It is the backbone of the economy. 40 00:02:55,218 --> 00:02:57,054 The world's demand for natural rubber 41 00:02:57,095 --> 00:03:00,140 is about 13,000 kilometric tons a year, 42 00:03:00,182 --> 00:03:05,062 or the equivalent of 86,868 blue whales. 43 00:03:06,104 --> 00:03:07,439 That's a lot of rubber. 44 00:03:07,481 --> 00:03:10,651 (engine revving) 45 00:03:10,692 --> 00:03:14,780 And Monster Jam has a huge demand for it. 46 00:03:14,821 --> 00:03:17,950 What?! What?! 47 00:03:17,991 --> 00:03:20,243 Yeah! 48 00:03:22,120 --> 00:03:24,289 I wanna ask you about rubber. 49 00:03:24,331 --> 00:03:25,832 You're like the rubber guy. 50 00:03:25,874 --> 00:03:27,542 - The rubber guy. 51 00:03:27,584 --> 00:03:29,670 - I'm not sure if I like that. - (Kal laughs) 52 00:03:29,711 --> 00:03:32,089 - Bill Easterly is responsible for putting tires 53 00:03:32,130 --> 00:03:35,008 on all those Monster Jam trucks. 54 00:03:35,050 --> 00:03:37,761 With 33 years of motor sports experience, 55 00:03:37,803 --> 00:03:40,555 he knows a lot about when the rubber hits the road, 56 00:03:40,597 --> 00:03:42,975 or dirt, or whatever. 57 00:03:43,016 --> 00:03:44,601 So you know a lot about tires. 58 00:03:44,643 --> 00:03:47,646 How important are tires and rubber to Monster Jam? 59 00:03:47,688 --> 00:03:49,439 - Well, we can't perform without 'em. - Yeah. 60 00:03:49,481 --> 00:03:51,108 - We have trucks that are jumping in the air, 61 00:03:51,149 --> 00:03:52,943 landing on the ground at 20 Gs. 62 00:03:54,945 --> 00:03:57,781 The truck weighs 12,000 pounds. 63 00:03:57,823 --> 00:04:00,242 The math is almost a quarter million pounds 64 00:04:00,283 --> 00:04:01,868 of force hitting the ground. 65 00:04:01,910 --> 00:04:04,496 The tires have to survive that repeatedly. 66 00:04:08,000 --> 00:04:09,835 So the tires are very important. 67 00:04:09,876 --> 00:04:12,629 - How much do tires like this cost? 68 00:04:12,671 --> 00:04:14,256 - These tires can cost $3,000. 69 00:04:14,297 --> 00:04:15,841 - People ask-- - Each? 70 00:04:15,882 --> 00:04:17,509 - Each. Yeah. - [Kal] Oh, whoa. 71 00:04:17,551 --> 00:04:20,053 - What we do to tires isn't fair to begin with, 72 00:04:20,095 --> 00:04:22,931 sending them 30 feet in the air, crashing these trucks 73 00:04:22,973 --> 00:04:26,560 all over the floor, crushing over cars. 74 00:04:26,601 --> 00:04:28,437 We can damage a tire once in a while. 75 00:04:31,064 --> 00:04:33,567 So we have to build an extra, extra strong tire 76 00:04:33,608 --> 00:04:35,152 to withstand what we do to them. 77 00:04:35,193 --> 00:04:37,529 Natural rubber builds a great extra strong product 78 00:04:37,571 --> 00:04:40,365 so that we can be the type of performers we are. 79 00:04:44,411 --> 00:04:46,997 - [Kal] There are synthetic rubbers made from petroleum, 80 00:04:47,039 --> 00:04:50,751 but the most vital rubber products can't be synthetic. 81 00:04:50,751 --> 00:04:52,294 Why? 82 00:04:52,335 --> 00:04:54,755 In the face of heat, abrasion and age, 83 00:04:54,796 --> 00:04:56,631 synthetic rubber just won't hold up. 84 00:04:58,341 --> 00:04:59,968 Synthetic rubber plane tires? 85 00:05:00,010 --> 00:05:01,303 Don't even think about it. 86 00:05:01,344 --> 00:05:02,846 They can't handle the landing, 87 00:05:02,888 --> 00:05:06,224 and they would blow up on the runway. 88 00:05:06,266 --> 00:05:08,769 It's the same with long-haul trucks driving cross country. 89 00:05:08,810 --> 00:05:11,229 Synthetic rubbers can't take the beating. 90 00:05:13,857 --> 00:05:16,943 Natural rubber is the only substance known to man 91 00:05:16,985 --> 00:05:18,987 that can do the things that planes, 92 00:05:19,029 --> 00:05:21,490 trucks, and these monsters need. 93 00:05:23,283 --> 00:05:26,495 But natural rubber is in real danger of disappearing, 94 00:05:26,536 --> 00:05:30,749 and if it does, it would be the end of Monster Jam 95 00:05:30,791 --> 00:05:33,251 and nearly everything else you depend on in life. 96 00:05:39,841 --> 00:05:44,221 This is the source of natural rubber, the raw sap or latex 97 00:05:44,262 --> 00:05:49,101 from the Brazilian rubber tree, Hevea Brasiliensis. 98 00:05:49,142 --> 00:05:51,895 These trees are monoclonal, 99 00:05:51,937 --> 00:05:54,439 meaning this tree and this tree 100 00:05:54,481 --> 00:05:58,985 and this one all share the exact same genetic makeup. 101 00:05:59,027 --> 00:06:01,404 Which also means that they're all susceptible 102 00:06:01,446 --> 00:06:02,948 to the same disease. 103 00:06:04,908 --> 00:06:08,245 That disease is a fungus called Rubber Tree Blight, 104 00:06:09,955 --> 00:06:12,499 Microcyclus ulei. 105 00:06:14,126 --> 00:06:16,503 For a rubber tree, it's like the Black Death, 106 00:06:16,545 --> 00:06:20,257 the Spanish flu, and Ebola combined. 107 00:06:20,298 --> 00:06:22,259 There's no vaccine or cure. 108 00:06:24,427 --> 00:06:25,846 How scary is an outbreak? 109 00:06:25,887 --> 00:06:28,014 Well, since all rubber trees are basically 110 00:06:28,056 --> 00:06:31,768 identical siblings, this disease has the potential 111 00:06:31,810 --> 00:06:34,896 to destroy the entire rubber industry. 112 00:06:49,119 --> 00:06:51,830 With all this potential devastation and a clear threat 113 00:06:51,872 --> 00:06:54,457 to our global supply of rubber, who do you call 114 00:06:54,499 --> 00:06:57,919 when that vicious little spore has big plans? 115 00:06:57,961 --> 00:07:00,922 Only the most extreme, badass, 116 00:07:00,964 --> 00:07:04,426 take no prisoners plant pathologist. 117 00:07:04,467 --> 00:07:06,178 - Can I wear this? - Indeed, you can. 118 00:07:06,219 --> 00:07:08,680 - I got an honorary doctorate once 119 00:07:08,722 --> 00:07:10,140 - for doing nothing. - You did? 120 00:07:10,182 --> 00:07:11,683 Well, that's the usual-- 121 00:07:11,725 --> 00:07:14,019 - So we are both doctors. - Oh, we are indeed. 122 00:07:14,060 --> 00:07:15,395 - But you actually know what you're doing. 123 00:07:15,437 --> 00:07:17,606 - Yeah, well, my career has actually been 124 00:07:17,647 --> 00:07:19,065 mainly in the tropics. 125 00:07:19,107 --> 00:07:21,067 I've worked mainly on tropical crops, 126 00:07:21,109 --> 00:07:22,777 coffee, cacao and rubber. 127 00:07:22,819 --> 00:07:24,571 - Let's get some rubber trees to cough 128 00:07:24,613 --> 00:07:25,947 and see how they're doing. 129 00:07:33,538 --> 00:07:37,459 Dr. Harry Evans has had over 40 years of experience 130 00:07:37,500 --> 00:07:40,587 battling plant and fungal diseases. 131 00:07:40,629 --> 00:07:42,797 He spends most of his time in the lab, 132 00:07:42,839 --> 00:07:47,052 cataloging archived specimens, including leaf blight. 133 00:07:47,093 --> 00:07:49,054 - And this would the first place that rubber material 134 00:07:49,095 --> 00:07:51,097 would come from, almost certainly from Asia, 135 00:07:51,139 --> 00:07:53,642 and to where disease is suspected, rubber blight. 136 00:07:53,683 --> 00:07:58,438 - [Kal] Okay. - This specimen here is in fact rubber blight 137 00:07:58,480 --> 00:08:01,316 from Trinidad from the 1980s. 138 00:08:01,358 --> 00:08:02,776 These are called shot holes, 139 00:08:02,817 --> 00:08:04,277 and that's what happens to the leaves. 140 00:08:04,319 --> 00:08:06,947 - You see the shot holes. - (gunshot bangs) 141 00:08:06,988 --> 00:08:09,074 - [Kal] Yeah. - And all the leaves fall out, 142 00:08:09,115 --> 00:08:12,494 and eventually, the leaf will fold prematurely, 143 00:08:12,535 --> 00:08:14,246 and the whole tree will be defoliated, 144 00:08:14,287 --> 00:08:16,748 and possibly death of the tree after that. 145 00:08:16,790 --> 00:08:19,709 The collector here, Chi, was Malaysian, 146 00:08:19,751 --> 00:08:22,921 and he was looking at all aspects of the disease 147 00:08:22,963 --> 00:08:24,673 to make himself acquainted with it. 148 00:08:24,714 --> 00:08:26,925 So in fact, when you look at it, you can-- 149 00:08:26,967 --> 00:08:29,803 - I'm sorry. - I'm laughing because 150 00:08:29,844 --> 00:08:32,472 in Hindi, "chi" means shit. 151 00:08:32,514 --> 00:08:36,226 So this is Dr. Shit who sent you these samples. 152 00:08:41,898 --> 00:08:46,236 - Yeah, so what Chi's sort of descriptions, 153 00:08:46,278 --> 00:08:49,864 the first people on the scene may be able to say, 154 00:08:49,906 --> 00:08:51,533 "Yes, that's rubber blight." 155 00:08:51,574 --> 00:08:54,744 And looking simply down this microscope, at it, 156 00:08:54,786 --> 00:08:57,038 you see those structures there. 157 00:08:59,708 --> 00:09:01,209 - [Kal] Oh, yeah, wow. 158 00:09:01,251 --> 00:09:02,919 - [Dr. Evans] Yeah, so that's the eruption. 159 00:09:02,961 --> 00:09:04,587 And what happens then, it pushes the leaf out 160 00:09:04,629 --> 00:09:06,923 and then it becomes like this Swiss cheese-- 161 00:09:06,965 --> 00:09:08,675 - I mean when you say eruption, 162 00:09:08,717 --> 00:09:09,801 that actually looks like a mountain range. 163 00:09:09,843 --> 00:09:11,177 - Yeah, yeah. 164 00:09:11,219 --> 00:09:12,929 At that magnification, yeah. 165 00:09:12,971 --> 00:09:17,350 Within those are the structures holding the sexual spores. 166 00:09:17,392 --> 00:09:20,020 - [Kal] Okay. - Which are then violently 167 00:09:20,061 --> 00:09:21,938 released and carry on the process. 168 00:09:21,980 --> 00:09:24,274 This is a viable structure. 169 00:09:24,316 --> 00:09:26,026 It's a mountain range. 170 00:09:26,067 --> 00:09:27,527 So it's protected, and inside are the spores. 171 00:09:27,569 --> 00:09:29,487 And it's a very slow-growing fungi. 172 00:09:29,529 --> 00:09:31,406 It's three or four weeks. 173 00:09:31,448 --> 00:09:33,575 - It takes three or four weeks to get to that stage? 174 00:09:33,616 --> 00:09:35,744 - To get to that sort of growth. 175 00:09:35,785 --> 00:09:38,246 - Whoa! Okay. - Yeah. 176 00:09:38,288 --> 00:09:41,875 - So if you put a little sample of that in there, 177 00:09:41,916 --> 00:09:43,752 in four weeks, it would look like that? 178 00:09:43,793 --> 00:09:45,128 - [Dr. Evans] Yeah. 179 00:09:45,170 --> 00:09:46,963 - And if they find rubber blight 180 00:09:47,005 --> 00:09:48,757 or if you find rubber blight rather, 181 00:09:48,798 --> 00:09:51,259 they send you a sample, by the time you get it, 182 00:09:51,301 --> 00:09:53,345 is it too late to do something about it? 183 00:09:53,386 --> 00:09:54,971 - The alarm bells would go. 184 00:09:55,013 --> 00:09:56,806 Once this disease gets going through a plantation, 185 00:09:56,848 --> 00:09:59,184 it just wipes it out. 186 00:09:59,225 --> 00:10:01,644 - It's already happened once before. 187 00:10:03,229 --> 00:10:05,523 A hundred years ago, 90% of all the world's 188 00:10:05,565 --> 00:10:08,526 natural rubber supply came from Brazil, 189 00:10:08,568 --> 00:10:11,237 which led to companies like Ford creating massive 190 00:10:11,279 --> 00:10:14,532 rubber plantations to make tires for their cars. 191 00:10:14,574 --> 00:10:16,993 In the 1930s, leaf blight attacked, 192 00:10:17,035 --> 00:10:19,120 jumping from tree to tree so fast 193 00:10:19,162 --> 00:10:21,998 that by the time it was discovered, it was too late. 194 00:10:22,040 --> 00:10:24,084 This tiny spore laid waste 195 00:10:24,125 --> 00:10:27,587 to almost all the trees in South America. 196 00:10:27,629 --> 00:10:30,924 Ford had invested $20 million into the plantation, 197 00:10:30,965 --> 00:10:34,677 or roughly $280 million in today's dollars. 198 00:10:34,719 --> 00:10:36,638 They ended up selling it back to Brazil 199 00:10:36,679 --> 00:10:40,183 for a little over 1% of what they had invested. 200 00:10:40,225 --> 00:10:42,310 Now, Brazil's share of the rubber market 201 00:10:42,352 --> 00:10:48,066 has dropped from 90% to 0.001%. 202 00:10:48,108 --> 00:10:50,902 Where are the other rubber plantations? 203 00:10:50,944 --> 00:10:54,155 - The majority are in Asia, 90%, 95%. 204 00:10:54,197 --> 00:10:56,032 - [Kal] Oh, 95% of industrial rubber 205 00:10:56,074 --> 00:10:57,742 for the whole world is-- - Natural rubber, 206 00:10:57,784 --> 00:10:59,661 it would be Asian in origin, yes. 207 00:10:59,702 --> 00:11:01,329 - Got it. So then it's fairly targeted. 208 00:11:01,371 --> 00:11:03,123 If leaf blight would have hit there, 209 00:11:03,164 --> 00:11:04,499 it could disrupt most of our rubber supply. 210 00:11:04,541 --> 00:11:06,042 - Yes, I think, well, 211 00:11:06,084 --> 00:11:08,420 it would disrupt the whole world economy. 212 00:11:10,046 --> 00:11:12,090 There's no geographic barriers after that. 213 00:11:12,132 --> 00:11:14,134 It would spread throughout the whole region, like it spread 214 00:11:14,175 --> 00:11:16,553 toward the whole of South and Central America. 215 00:11:16,594 --> 00:11:18,138 If it were to arrive, 216 00:11:18,179 --> 00:11:20,432 I think it would be very difficult to contain it. 217 00:11:23,017 --> 00:11:25,103 - [Kal] What would happen if leaf blight managed to spread 218 00:11:25,145 --> 00:11:27,689 across the Pacific Ocean and take hold in Asia? 219 00:11:27,730 --> 00:11:31,109 Not only would it spell the end to my monster truck rallies, 220 00:11:31,151 --> 00:11:34,404 it could take a sledgehammer to our global economy. 221 00:11:34,446 --> 00:11:35,780 Could you imagine? 222 00:11:35,822 --> 00:11:37,407 If not, let me help you. 223 00:11:44,664 --> 00:11:47,041 And here we are. 224 00:11:47,083 --> 00:11:50,545 The apocalypse looks like this, where all planes 225 00:11:50,587 --> 00:11:53,756 are grounded and the world comes to a screeching halt. 226 00:12:01,139 --> 00:12:02,599 - [Dr. Cornish] You see how massive these things are. 227 00:12:02,640 --> 00:12:03,933 - [Kal] Yeah, that's huge. 228 00:12:03,975 --> 00:12:07,020 I guess this is all still being help up by-- 229 00:12:07,061 --> 00:12:09,898 - [Dr. Cornish] Yeah, held up by rubber tires. (chuckles) 230 00:12:09,939 --> 00:12:11,441 - [Kal] I'm here to find out what a world 231 00:12:11,483 --> 00:12:13,943 without all this rubber would mean for us. 232 00:12:13,985 --> 00:12:17,197 An airplane graveyard where one-time titans of the skies 233 00:12:17,238 --> 00:12:20,283 are hacked apart and salvaged for scraps. 234 00:12:20,325 --> 00:12:22,202 So these tires-- 235 00:12:22,243 --> 00:12:23,745 - [Dr. Cornish] 100% natural rubber. 236 00:12:23,786 --> 00:12:25,580 - [Kal] Even these. - [Dr. Cornish] Almost certainly 237 00:12:25,622 --> 00:12:27,457 because they're such heavy duty. 238 00:12:27,499 --> 00:12:29,751 I hear we can see in here there might be some bits left. 239 00:12:29,792 --> 00:12:30,752 There would have been some seals 240 00:12:30,793 --> 00:12:32,879 and gaskets and things in there. 241 00:12:32,921 --> 00:12:35,465 - I assume this has rubber components, or is it all plastic? 242 00:12:35,507 --> 00:12:38,176 - Well, here's the rubber. 243 00:12:38,218 --> 00:12:39,844 - Oh, okay. - There's some rubber there. 244 00:12:39,886 --> 00:12:42,138 There might be some rubber in these luxury pads 245 00:12:42,180 --> 00:12:46,267 so your glass of alcohol or champagne doesn't slip. 246 00:12:46,309 --> 00:12:48,811 - So would anything up here be made out of rubber? 247 00:12:51,439 --> 00:12:54,192 - [Dr. Cornish] Yeah, you got it. 248 00:12:54,234 --> 00:12:57,153 - [Kal] Dr. Katrina Cornish has been trying to warn us all 249 00:12:57,195 --> 00:13:00,198 about the economic consequences of a world without rubber. 250 00:13:02,283 --> 00:13:03,910 And she has a very clear message 251 00:13:03,952 --> 00:13:05,703 about this potential rubber crisis. 252 00:13:07,330 --> 00:13:09,707 - We must not continue to rely 253 00:13:09,749 --> 00:13:13,586 on a clonal tree that is disease sensitive. 254 00:13:13,628 --> 00:13:17,840 This is a ridiculous way to run a global economy. 255 00:13:17,882 --> 00:13:19,676 - [Kal] Is leaf blight a real threat? 256 00:13:19,717 --> 00:13:21,928 - Absolutely. Over the last 20 years, 257 00:13:21,970 --> 00:13:24,347 it's appeared in India once, in Thailand once. 258 00:13:24,389 --> 00:13:26,391 And then it was wholesale extermination 259 00:13:26,432 --> 00:13:28,351 of everything in sight to control it. 260 00:13:28,393 --> 00:13:30,311 If you try and fly on an airplane 261 00:13:30,353 --> 00:13:32,522 from South America to Southeast Asia, 262 00:13:32,564 --> 00:13:34,566 you'd be very hard pressed to find a flight. 263 00:13:34,607 --> 00:13:36,609 You have to go somewhere else and get off the plane, 264 00:13:36,651 --> 00:13:38,945 get on a plane that hasn't been to South America, 265 00:13:38,987 --> 00:13:40,655 and it's to do with leaf blight quarantine. 266 00:13:40,697 --> 00:13:42,782 - Is that right? - Yeah, yeah. 267 00:13:42,824 --> 00:13:44,659 It can't make the ocean crossing because it's quite short lived, 268 00:13:44,701 --> 00:13:47,078 but it can make the airplane crossing. 269 00:13:47,120 --> 00:13:49,080 - So if this happens and if these trees 270 00:13:49,122 --> 00:13:52,292 start getting wiped out, what happens to the economy 271 00:13:52,333 --> 00:13:54,586 or the impact of not getting rubber? 272 00:13:54,627 --> 00:13:57,130 - There would, it would be a catastrophic economic collapse. 273 00:13:57,171 --> 00:13:58,381 There's no sector of the modern economy 274 00:13:58,423 --> 00:14:00,174 that isn't completely dependent 275 00:14:00,216 --> 00:14:01,551 upon the availability of natural rubber. 276 00:14:01,593 --> 00:14:04,470 You are going to lose, eventually, 277 00:14:04,512 --> 00:14:07,974 the entire modern world. 278 00:14:08,016 --> 00:14:09,851 You are going to lose it. 279 00:14:09,892 --> 00:14:14,606 We are going to go back 120, 130 years to what you can do. 280 00:14:14,647 --> 00:14:16,482 - Oh, wow. - Yes. 281 00:14:16,524 --> 00:14:20,194 You know, ox carts, we go back to ox carts or something. 282 00:14:20,236 --> 00:14:22,280 You know, horses and leather. 283 00:14:22,322 --> 00:14:25,366 There's nothing, medicine, transportation, you name it. 284 00:14:25,408 --> 00:14:28,286 - So how do we solve the rubber problem? 285 00:14:28,328 --> 00:14:29,912 - We solve the rubber problem 286 00:14:29,954 --> 00:14:33,082 by increasing the biodiversity of the rubber supply 287 00:14:33,124 --> 00:14:35,043 and doing that as quickly as we possibly can. 288 00:14:35,084 --> 00:14:38,296 - So there's an opportunity for governments to invest now. 289 00:14:38,338 --> 00:14:41,424 - Absolutely. But you know, we're not good at that. 290 00:14:41,466 --> 00:14:43,134 Something catastrophic happens, 291 00:14:43,176 --> 00:14:46,012 it's like, "Oh, gosh, that was a bad thing." 292 00:14:46,054 --> 00:14:47,722 And the fact that dozens of people might be saying, 293 00:14:47,764 --> 00:14:49,098 "This is gonna happen. This is gonna happen. 294 00:14:49,140 --> 00:14:51,017 "This is gonna happen. "This is gonna happen." 295 00:14:51,059 --> 00:14:54,479 "Oops, did we know this was gonna happen?" 296 00:14:54,520 --> 00:14:56,606 "Well, we've been trying to tell you. 297 00:14:56,648 --> 00:14:58,149 "You wouldn't listen. 298 00:14:58,191 --> 00:14:59,817 "You didn't want to be proactive. 299 00:14:59,859 --> 00:15:02,528 "You wanted to be reactive." 300 00:15:02,570 --> 00:15:05,490 - [Kal] So why isn't the global economy doing something 301 00:15:05,531 --> 00:15:08,910 to counter the potential effects of leaf blight? 302 00:15:08,951 --> 00:15:12,288 It turns out economies have the tendency 303 00:15:12,330 --> 00:15:15,583 to not address the very problems that might affect them, 304 00:15:15,625 --> 00:15:17,543 the kinds of problems that could happen 305 00:15:17,585 --> 00:15:20,630 just about any place that money changes hands. 306 00:15:23,883 --> 00:15:26,427 - When someone talks about uncertainty in the economy, 307 00:15:26,469 --> 00:15:29,931 they're likely referring to externalities, outside variables 308 00:15:29,972 --> 00:15:32,308 that can affect everyone connected to the market. 309 00:15:32,350 --> 00:15:35,853 Externalities can be positive, like last year in 2004 310 00:15:35,895 --> 00:15:38,523 when MySpace opened up a headquarters down the road. 311 00:15:38,564 --> 00:15:41,901 Stable jobs for years to come! (laughs) 312 00:15:41,943 --> 00:15:44,362 But more often, externalities take the form 313 00:15:44,404 --> 00:15:47,657 of catastrophes, ecological diseases like leaf blight, 314 00:15:47,699 --> 00:15:49,367 natural disasters like hurricanes, 315 00:15:49,409 --> 00:15:52,078 and even man-made fuck-ups like a nuclear meltdown, 316 00:15:52,120 --> 00:15:54,372 or in my case, the fact that my house was built 317 00:15:54,414 --> 00:15:56,541 on an ancient burial ground. 318 00:15:56,582 --> 00:15:58,418 Look what attacked me in my sleep. 319 00:15:58,459 --> 00:15:59,669 - Oh, how much for the bones? 320 00:15:59,711 --> 00:16:02,046 - They're not for sale, you monster. 321 00:16:02,088 --> 00:16:03,423 Okay, seven bucks. 322 00:16:05,174 --> 00:16:08,136 Now to make ends meet, I have to sell all this shit. 323 00:16:08,177 --> 00:16:09,804 When I bought this stuff, 324 00:16:09,846 --> 00:16:11,514 the market didn't price in the externalities 325 00:16:11,556 --> 00:16:14,225 that now make this crap impossible to sell. 326 00:16:14,267 --> 00:16:16,394 I can't believe I didn't get a discount on my Hummer 327 00:16:16,436 --> 00:16:18,521 in case of a spike in gas prices. 328 00:16:18,563 --> 00:16:20,732 - What's it cost to fill up the tank? 329 00:16:20,773 --> 00:16:22,233 - Infinity dollars. 330 00:16:23,901 --> 00:16:26,237 I paid 15 bucks a pop for these CDs, 331 00:16:26,279 --> 00:16:28,781 but now I'm letting them go for $0.50 each. 332 00:16:28,823 --> 00:16:31,159 Ooh, except for the Papa Roach. 333 00:16:31,200 --> 00:16:33,119 Collector's item. 334 00:16:33,161 --> 00:16:36,038 If you buy 'em, you could take the records for free. 335 00:16:36,080 --> 00:16:38,374 Vinyl's never coming back. (chuckles) 336 00:16:38,416 --> 00:16:41,002 Oh, Google is over $100 a share? 337 00:16:41,043 --> 00:16:43,504 (chuckles) Now that it's clearly topped out, 338 00:16:43,546 --> 00:16:46,924 I'll cash out and move to a place that has no burial ground. 339 00:16:46,966 --> 00:16:49,010 - I heard that New Orleans doesn't bury their people underground. 340 00:16:49,051 --> 00:16:51,637 - Well, it looks like this guy is headed out to the Big Easy. 341 00:16:51,679 --> 00:16:52,680 - [Woman] (chuckles) Safe travels. 342 00:16:52,722 --> 00:16:54,348 - Thanks, lady. (chuckles) 343 00:16:54,390 --> 00:16:58,102 New Orleans in 2005, what could go wrong? 344 00:16:59,562 --> 00:17:01,564 (thunder rumbles) 345 00:17:01,606 --> 00:17:04,650 - [Kal] So what does this looming externality of leaf blight 346 00:17:04,692 --> 00:17:07,528 mean for the people in the rubber supply chain? 347 00:17:07,570 --> 00:17:09,280 To find out, I'm starting my journey 348 00:17:09,322 --> 00:17:11,741 at the beginning of the natural rubber trail. 349 00:17:22,877 --> 00:17:24,837 Thailand produces more than a third 350 00:17:24,879 --> 00:17:27,715 of the planet's rubber on plantations just like this one 351 00:17:27,757 --> 00:17:30,343 in the middle of what used to be a rainforest. 352 00:17:32,428 --> 00:17:33,846 This is Bo. 353 00:17:33,888 --> 00:17:36,849 His job is to harvest the raw rubber or latex. 354 00:17:36,891 --> 00:17:38,392 His workday is just beginning. 355 00:17:40,937 --> 00:17:43,397 Like the condom, latex is tapped all night, 356 00:17:43,439 --> 00:17:45,983 into the early morning because during the day, 357 00:17:46,025 --> 00:17:50,071 the jungle heat causes the latex to coagulate too quickly. 358 00:17:50,112 --> 00:17:53,115 That's where the metaphor falls apart. 359 00:17:53,157 --> 00:17:55,827 - [Bo] First, you remove last night's dried latex. 360 00:17:59,455 --> 00:18:02,041 - Tap the tree slowly. - [Kal] Oh, wow. 361 00:18:04,126 --> 00:18:05,253 Wow! 362 00:18:08,089 --> 00:18:09,632 - Okay? 363 00:18:09,674 --> 00:18:11,175 - [Kal] How long does that take to fill up? 364 00:18:11,217 --> 00:18:14,929 - It takes about six hours to fill up. 365 00:18:14,971 --> 00:18:17,431 - [Kal] How many trees do you do at one time. 366 00:18:17,473 --> 00:18:20,101 - It is... 367 00:18:20,142 --> 00:18:21,853 one thousand trees. 368 00:18:21,894 --> 00:18:24,272 Sometimes it can be up to twelve hundred trees. 369 00:18:24,313 --> 00:18:25,356 - Wow. 370 00:18:29,360 --> 00:18:32,655 It takes about two years for a tree to produce enough rubber 371 00:18:32,697 --> 00:18:37,451 to make one regular car tire, not even a monster truck tire. 372 00:18:39,120 --> 00:18:41,080 As you guys can see, it's raining. 373 00:18:41,122 --> 00:18:43,374 In reality, these guys don't tap rubber trees in the rain 374 00:18:43,416 --> 00:18:45,376 because the water dilutes the latex. 375 00:18:45,418 --> 00:18:48,379 But we've got like 20 people behind the camera, 376 00:18:48,421 --> 00:18:50,590 came to the middle of Thailand, it's three o'clock 377 00:18:50,631 --> 00:18:53,759 in the morning, for the rubber episode, so here we are. 378 00:19:04,228 --> 00:19:07,398 - Now, just one tree left. 379 00:19:07,440 --> 00:19:11,527 And then we are going to weigh it. 380 00:19:11,569 --> 00:19:14,447 Come. 381 00:19:14,488 --> 00:19:16,824 - [Kal] After tapping latex all night, 382 00:19:16,866 --> 00:19:19,076 Bo is collecting buckets of the white liquid. 383 00:19:26,709 --> 00:19:28,753 - We're going to weigh it now. 384 00:19:32,465 --> 00:19:33,925 - [Kal] Once the buckets are filled, 385 00:19:33,966 --> 00:19:36,469 Bo must drive to the plantation weigh station 386 00:19:36,510 --> 00:19:39,013 to find out how much he'll earn for the night's work. 387 00:19:47,563 --> 00:19:51,651 This plantation contains 475 acres of rubber trees. 388 00:19:54,111 --> 00:19:57,573 If just a few spores of blight landed here, 389 00:19:57,615 --> 00:20:00,284 the trees could all be wiped out in just a few weeks. 390 00:20:07,124 --> 00:20:09,251 There are 30 tappers like Bo 391 00:20:09,293 --> 00:20:11,754 who both live and work on this plantation. 392 00:20:11,796 --> 00:20:13,422 Once the rubber is weighed, 393 00:20:13,464 --> 00:20:16,592 the plantation owner will pay them. 394 00:20:16,634 --> 00:20:19,220 - My father bought this property 395 00:20:19,261 --> 00:20:21,597 and started planting rubber trees. 396 00:20:21,639 --> 00:20:23,641 - He bought it specifically for rubber trees? 397 00:20:23,683 --> 00:20:26,018 - [Dr. Thitadilok] Yeah. 398 00:20:26,060 --> 00:20:27,395 - [Kal] When the Thai government offered incentives 399 00:20:27,436 --> 00:20:28,854 to rubber farmers eight years ago, 400 00:20:28,896 --> 00:20:31,524 the owner of this plantation, Dr. Chukiet, 401 00:20:31,565 --> 00:20:33,943 planted many new trees. 402 00:20:33,985 --> 00:20:36,529 Though a rubber tree can last for 25 years, 403 00:20:36,570 --> 00:20:39,657 it takes seven years for one to mature. 404 00:20:39,699 --> 00:20:43,327 So he has only recently seen any return on his investment. 405 00:20:45,454 --> 00:20:47,415 So what's happening out there? 406 00:20:47,456 --> 00:20:51,627 - We bring the latex in from the tapping tree, okay? 407 00:20:51,669 --> 00:20:54,839 And now we go to measure the weight. 408 00:20:54,880 --> 00:20:56,632 How much it weighs, okay? 409 00:20:56,674 --> 00:20:59,218 And today's price is 47 baht per kilo. 410 00:20:59,260 --> 00:21:02,179 - [Kal] 47 baht per kilo. That's today's price. 411 00:21:02,221 --> 00:21:03,597 - Yeah, today's price. - How do you know what today's price is? 412 00:21:03,639 --> 00:21:05,307 We have to call the factory. 413 00:21:05,349 --> 00:21:06,600 - Oh, the factory will tell you? 414 00:21:06,642 --> 00:21:07,852 [Dr. Thitadilok] Yeah. 415 00:21:07,893 --> 00:21:09,812 - [Kal] 47 baht per kilo equates to about 416 00:21:09,854 --> 00:21:14,942 US $1,300 per ton of liquid rubber. 417 00:21:14,984 --> 00:21:19,363 Dr. Chukiet splits the earnings with the tappers 60/40, 418 00:21:19,405 --> 00:21:22,742 which means that Bo will get only about nine bucks. 419 00:21:22,783 --> 00:21:26,120 In Thailand, that's less than the daily minimum wage. 420 00:21:26,162 --> 00:21:27,830 - This is the problem that we have, 421 00:21:27,872 --> 00:21:29,415 problem with nowadays. 422 00:21:29,457 --> 00:21:33,461 - Worker shortage because of the low price. - Okay. 423 00:21:33,502 --> 00:21:36,881 The workers prefer to tap when the price is high. 424 00:21:36,922 --> 00:21:40,217 - [Kal] Yeah. - We couldn't recruit new workers 425 00:21:40,259 --> 00:21:44,221 when the old worker resigns, okay? 426 00:21:44,263 --> 00:21:46,557 We couldn't find a new one to replace. 427 00:21:46,599 --> 00:21:50,227 Before we used to be able to produce about six tons. 428 00:21:50,269 --> 00:21:51,353 - Six tons. 429 00:21:51,395 --> 00:21:52,980 - Per day. 430 00:21:53,022 --> 00:21:55,024 Right now, it's two tons per day. 431 00:21:55,066 --> 00:21:56,067 - [Kal] Two tons a day? 432 00:21:56,108 --> 00:21:57,735 - Yeah. - Wow. 433 00:21:57,777 --> 00:21:59,320 So that dropped by more than half. 434 00:21:59,361 --> 00:22:02,406 - More than half. That's why our production 435 00:22:02,448 --> 00:22:04,116 become low now. 436 00:22:04,158 --> 00:22:06,869 - [Kal] Okay. Have the prices been low the whole time, 437 00:22:06,911 --> 00:22:08,704 or is it just recently? 438 00:22:08,746 --> 00:22:11,290 Oh, The price now, 439 00:22:11,332 --> 00:22:13,876 the price has been down for a couple of years now. 440 00:22:13,918 --> 00:22:16,587 - It's been down? - Yeah. It's about... 441 00:22:16,629 --> 00:22:18,881 now, it's about thirty percent of what it used to be. 442 00:22:18,923 --> 00:22:20,674 - It's 30% of what it used to be? 443 00:22:20,716 --> 00:22:21,967 - Yes! 444 00:22:22,009 --> 00:22:24,386 - Three years ago? - Two years ago. 445 00:22:24,428 --> 00:22:28,057 It's quite a problem in Thailand. 446 00:22:28,099 --> 00:22:31,268 Business before, we used to live on 447 00:22:31,310 --> 00:22:34,396 rubber plantation as the main income. 448 00:22:34,438 --> 00:22:39,235 And now we try to shift our rubber to 449 00:22:39,276 --> 00:22:42,488 to coconut or to palm oil production. 450 00:22:42,530 --> 00:22:45,199 And we start to diversify our business. 451 00:22:45,241 --> 00:22:47,326 And now we cut down the 452 00:22:47,368 --> 00:22:49,120 the old rubber tree. 453 00:22:49,161 --> 00:22:50,788 - [Kal] I don't understand. 454 00:22:50,830 --> 00:22:52,957 If leaf blight is such a threat to the rubber supply 455 00:22:52,998 --> 00:22:56,043 and demand for natural rubber is always on the rise, 456 00:22:56,085 --> 00:22:57,795 why are the prices so low 457 00:22:57,837 --> 00:23:00,214 that farmers like Dr. Chukiet are losing money 458 00:23:00,256 --> 00:23:02,842 and considering chopping down their rubber trees? 459 00:23:04,260 --> 00:23:06,303 So where does the rubber go from here? 460 00:23:06,345 --> 00:23:08,305 - Okay, then after it's ready, 461 00:23:08,347 --> 00:23:12,143 we get the latex from the tank to the van. 462 00:23:12,184 --> 00:23:14,395 - Send it to the factory. - Okay. 463 00:23:14,436 --> 00:23:15,646 So these whole things go. 464 00:23:15,688 --> 00:23:16,981 - Go to factory. 465 00:23:19,525 --> 00:23:21,819 - [Kal] If Dr. Chukiet says that he gets the price 466 00:23:21,861 --> 00:23:24,613 from the factory, then that's where I'm headed 467 00:23:24,655 --> 00:23:26,866 to find out exactly why it's so low. 468 00:23:34,498 --> 00:23:37,835 This rubber factory is owned by Robert Meyer. 469 00:23:37,877 --> 00:23:42,381 In eight short years, he went from one factory to 38. 470 00:23:42,423 --> 00:23:46,635 He now produces 14% of all the world's rubber. 471 00:23:48,470 --> 00:23:51,098 Those drums of gooey latex look like this 472 00:23:51,140 --> 00:23:53,058 when Robert gets through with them, 473 00:23:53,100 --> 00:23:55,186 before he sells them to a tire company. 474 00:23:56,729 --> 00:23:59,064 - Kal, you can feel this is number one, warm. 475 00:23:59,106 --> 00:24:01,192 And it's sticky. 476 00:24:01,233 --> 00:24:02,902 - It is! Whoa! - So the process of baking 477 00:24:02,943 --> 00:24:04,445 has done two things. 478 00:24:04,486 --> 00:24:06,572 It has stabilized 479 00:24:06,614 --> 00:24:08,365 the decomposition of the product. 480 00:24:08,407 --> 00:24:10,159 So the organic deterioration has been stopped 481 00:24:10,201 --> 00:24:11,410 because it has been baked. 482 00:24:11,452 --> 00:24:13,829 And it amplifies the adhesion properties. 483 00:24:13,871 --> 00:24:15,414 - Okay. 484 00:24:15,456 --> 00:24:16,582 And it turns brown from the drying process? 485 00:24:16,624 --> 00:24:19,627 - Yeah. Like a cookie. - Yeah. 486 00:24:19,668 --> 00:24:21,212 - So these are the weighing stations 487 00:24:21,253 --> 00:24:23,839 where two biscuits are put on top of each other. 488 00:24:23,881 --> 00:24:25,799 Small bits are cut off or added 489 00:24:25,841 --> 00:24:28,594 - to make exactly a thirty-five kilo brick. - [Kal] Cool. 490 00:24:30,262 --> 00:24:32,556 - So here are now with finished products. - [Kal] Okay. 491 00:24:32,598 --> 00:24:34,975 So this is where the Wonka bars get shipped out. 492 00:24:35,017 --> 00:24:37,102 - That's the job of a rubber factory 493 00:24:37,144 --> 00:24:39,063 is to convert the agricultural produce into an industrial material. 494 00:24:39,104 --> 00:24:42,316 - [Kal] Yeah, that's really cool. 495 00:24:42,358 --> 00:24:43,984 - So as you would have figured out, right? 496 00:24:44,026 --> 00:24:47,571 We have two handovers which are relevant. 497 00:24:47,613 --> 00:24:51,033 Farmer handing over an agricultural produce to the factory. 498 00:24:51,075 --> 00:24:54,203 Factory handing over an industrial raw material 499 00:24:54,245 --> 00:24:56,372 to the maker of rubber products. 500 00:24:56,413 --> 00:24:58,540 Right, those are the two handover points 501 00:24:58,582 --> 00:25:01,335 where the baton passes to the next part of the value chain. 502 00:25:07,049 --> 00:25:08,676 - Are you worried about leaf blight? 503 00:25:08,717 --> 00:25:10,427 Is that a serious concern? 504 00:25:10,469 --> 00:25:12,763 - Everybody is always worried about leaf blight. 505 00:25:12,805 --> 00:25:14,139 - (laughs) Okay. - Okay? 506 00:25:14,181 --> 00:25:16,642 Now that little bug hasn't made, 507 00:25:16,684 --> 00:25:18,936 found its way to Southeast Asia. 508 00:25:18,978 --> 00:25:20,437 Look, maybe I'm too naive, 509 00:25:20,479 --> 00:25:22,648 or maybe I'm too emotionally invested 510 00:25:22,690 --> 00:25:26,527 in what I do to really think about that too much. 511 00:25:26,568 --> 00:25:28,737 But even if it came to Southeast Asia, 512 00:25:28,779 --> 00:25:31,490 it would be cause for a cost explosion of rubber. 513 00:25:31,532 --> 00:25:33,242 - But it sounds like that cost 514 00:25:33,284 --> 00:25:35,244 isn't factored into that current price. 515 00:25:35,286 --> 00:25:36,745 And then talking to rubber farmers, 516 00:25:36,787 --> 00:25:39,081 and they're saying in the last three years, 517 00:25:39,123 --> 00:25:42,293 the price they're getting for their latex has dropped dramatically. 518 00:25:42,334 --> 00:25:44,962 - Tremendously. - [Kal] Help me understand why that is. 519 00:25:45,004 --> 00:25:46,839 - Okay, to understand that, 520 00:25:46,880 --> 00:25:49,008 you really have to understand the history of rubber. 521 00:25:49,049 --> 00:25:51,427 Okay, so back in the day, there was a huge disconnect 522 00:25:51,468 --> 00:25:53,137 in terms of time, in terms of connectivity, 523 00:25:53,178 --> 00:25:54,888 being able to speak with one another 524 00:25:54,930 --> 00:25:56,432 between the origin and the consumer. 525 00:25:56,473 --> 00:25:58,434 So if you're a buyer, say you're a tire maker, 526 00:25:58,475 --> 00:26:00,644 and I'm a seller, you wanna know that you can buy 527 00:26:00,686 --> 00:26:02,563 this product not just today from what I have in the warehouse, 528 00:26:02,604 --> 00:26:03,981 but you wanna have this product throughout the year. 529 00:26:04,023 --> 00:26:06,150 - Okay. - Because you depend on it. 530 00:26:06,191 --> 00:26:09,445 - Okay. - So in order to bridge that, they created a futures market, 531 00:26:09,486 --> 00:26:11,655 and the rubber was traded on a futures market. 532 00:26:11,697 --> 00:26:13,490 - Can you explain what a futures market is? 533 00:26:13,532 --> 00:26:16,035 - Okay, so a futures market is where a buyer and a seller 534 00:26:16,076 --> 00:26:19,038 agree to certain terms of price, of volume, 535 00:26:19,079 --> 00:26:21,206 of grades, of specification, of origin, 536 00:26:21,248 --> 00:26:23,584 basically everything which you'd find in a contract, 537 00:26:23,625 --> 00:26:25,127 for delivery at some point in the future. 538 00:26:25,169 --> 00:26:27,338 - Okay. 539 00:26:27,379 --> 00:26:29,506 - So if I was a producer and I agree to supply you tonnage 540 00:26:29,548 --> 00:26:32,509 at price, at date, you will buy from an American trader 541 00:26:32,551 --> 00:26:34,136 who had an office in New York, 542 00:26:34,178 --> 00:26:35,929 who had a subsidiary in Singapore, and he will transact 543 00:26:35,971 --> 00:26:39,016 either directly or through another layer of middle men 544 00:26:39,058 --> 00:26:41,310 with the original producer, i.e. me. 545 00:26:41,352 --> 00:26:43,687 - [Kal] Okay. - And between us, we would guarantee 546 00:26:43,729 --> 00:26:45,147 that we would supply you what you want 547 00:26:45,189 --> 00:26:47,024 at the agreed price on the agreed date. 548 00:26:47,066 --> 00:26:50,152 So the futures market is a venue where, frankly speaking, 549 00:26:50,194 --> 00:26:52,321 I have very little say, if any. 550 00:26:52,363 --> 00:26:54,573 Even my customers don't have a say. 551 00:26:54,615 --> 00:26:56,033 If you speak to most of my customers, 552 00:26:56,075 --> 00:26:58,452 they will tell you that they want higher prices 553 00:26:58,494 --> 00:27:01,163 because they know the farmers are about to say enough, 554 00:27:01,205 --> 00:27:05,459 but neither of us who participate physically have control. 555 00:27:05,501 --> 00:27:08,003 - We're gonna need to understand futures better. 556 00:27:08,045 --> 00:27:10,381 - A futures contract is kinda like a concert ticket. 557 00:27:10,422 --> 00:27:13,258 Tickets could sell months before I actually perform. 558 00:27:13,300 --> 00:27:15,677 The contract is based on demand. 559 00:27:15,719 --> 00:27:17,554 I wouldn't charge $100 to see me in an arena 560 00:27:17,596 --> 00:27:18,972 if I didn't think I could sell it out. 561 00:27:19,014 --> 00:27:20,474 - Ha-ha, girl, you are too humble. 562 00:27:20,516 --> 00:27:21,809 You can sell out the moon. 563 00:27:21,850 --> 00:27:23,685 Ooh, tour on the moon. 564 00:27:23,727 --> 00:27:25,354 - Thank you, hype man. - Ha. 565 00:27:25,396 --> 00:27:27,106 - I sell these concert tickets way in advance 566 00:27:27,147 --> 00:27:29,191 - because it minimizes risk. - Hmm. 567 00:27:29,233 --> 00:27:30,651 - I worked so hard on this upcoming tour. 568 00:27:30,692 --> 00:27:32,820 I wrote an entire new album. 569 00:27:32,861 --> 00:27:35,155 I choreographed all the background dancers all by myself. 570 00:27:35,197 --> 00:27:39,076 - I mean, when I say it's dope as hell, it is dope as hell. 571 00:27:39,118 --> 00:27:40,619 - So I need guarantees 572 00:27:40,661 --> 00:27:42,079 that I'm gonna get paid for that hard work. 573 00:27:42,121 --> 00:27:43,914 - Mm-hmm. - And my fans want guarantees 574 00:27:43,956 --> 00:27:45,624 that they're gonna be able to see it. 575 00:27:45,666 --> 00:27:47,501 - I guarantee if I don't see this show, 576 00:27:47,543 --> 00:27:50,045 I'ma lose my shit, literally. 577 00:27:50,087 --> 00:27:51,839 It's just gonna open up and fall out. 578 00:27:51,880 --> 00:27:53,173 People are gonna be like, "Ugh, what is that?" 579 00:27:53,215 --> 00:27:54,716 I don't know. 580 00:27:54,758 --> 00:27:56,760 - So concert tickets are futures contracts, 581 00:27:56,802 --> 00:27:58,679 and scalpers are futures traders. 582 00:27:58,720 --> 00:28:00,889 - Mmm. - Of course, due to market volatility, 583 00:28:00,931 --> 00:28:02,850 these scalpers can actually lose money, 584 00:28:02,891 --> 00:28:05,269 like if I decided to livestream my concert for free. 585 00:28:05,310 --> 00:28:06,770 - Oh, no, no, no, no, no, no. 586 00:28:06,812 --> 00:28:08,689 You would literally break the internet. 587 00:28:08,730 --> 00:28:10,566 - We can't have that. - I hope I won't have to. 588 00:28:10,607 --> 00:28:12,317 But here's the worst part. 589 00:28:12,359 --> 00:28:14,278 Scalpers buy so many tickets that they control 590 00:28:14,319 --> 00:28:17,322 significant supply, which means they can set the price. 591 00:28:17,364 --> 00:28:19,825 And that is market manipulation. 592 00:28:19,867 --> 00:28:21,493 - Your shows are market price. 593 00:28:21,535 --> 00:28:23,745 You're like the lobster on a menu. 594 00:28:23,787 --> 00:28:26,832 - Yeah, I am a lobster. - Go get 'em, girl. 595 00:28:28,750 --> 00:28:30,919 - [Meghan] Hello, Cleveland! 596 00:28:30,961 --> 00:28:32,296 - While I go get this money 597 00:28:32,337 --> 00:28:34,590 for the rest of these Meghan Trainor tickets. 598 00:28:34,631 --> 00:28:36,300 I got Meghan Trainor tickets. 599 00:28:36,341 --> 00:28:37,301 They're going fast. 600 00:28:37,342 --> 00:28:39,595 Show starts now. (laughs) 601 00:28:41,972 --> 00:28:46,560 - So who are the scalpers in the rubber industry? 602 00:28:46,602 --> 00:28:50,856 It's these guys, traders on the commodity futures markets. 603 00:28:53,192 --> 00:28:55,277 Futures traders buy up those contracts, 604 00:28:55,319 --> 00:28:59,698 speculating that over time, their value will increase. 605 00:28:59,740 --> 00:29:03,243 The trader's goal is to buy low, sell high 606 00:29:03,285 --> 00:29:05,829 and get rich by pocketing the difference. 607 00:29:07,873 --> 00:29:10,459 (upbeat music) 608 00:29:15,547 --> 00:29:19,092 Singapore is one of the biggest financial hubs in the world. 609 00:29:19,134 --> 00:29:21,803 It's where thousands of commodities futures contracts 610 00:29:21,845 --> 00:29:23,013 are traded everyday. 611 00:29:25,140 --> 00:29:27,100 And one of the guys who used to trade 612 00:29:27,142 --> 00:29:29,895 those rubber contracts is Dar Wong. 613 00:29:29,937 --> 00:29:33,398 For 30 years, he worked for big investment companies 614 00:29:33,440 --> 00:29:35,025 and now travels around Asia, 615 00:29:35,067 --> 00:29:38,946 offering advice to struggling rubber farmers. 616 00:29:38,987 --> 00:29:41,281 If we need rubber so badly, if everybody in the world needs it-- 617 00:29:41,323 --> 00:29:43,450 - Everybody needs some. - [Kal] Clothes, glasses, wires. 618 00:29:43,492 --> 00:29:45,160 - Yes. 619 00:29:45,202 --> 00:29:47,788 - Why is the price so low? 620 00:29:47,829 --> 00:29:52,251 - What actually influences the price volatility of the rubber 621 00:29:52,292 --> 00:29:55,212 is the global inflation and recession. 622 00:29:55,254 --> 00:29:56,922 - Okay. - For example, 623 00:29:56,964 --> 00:29:59,216 in 2013, rubber prices started to fall, 624 00:29:59,258 --> 00:30:02,344 and during this time, the Thailand government actually said 625 00:30:02,386 --> 00:30:06,348 that rubber prices are probably going through a short-term correction. 626 00:30:06,390 --> 00:30:08,475 But rubber prices actually did not recover, 627 00:30:08,517 --> 00:30:10,978 and it went down lower and lower and lower. 628 00:30:11,019 --> 00:30:13,855 Obviously, when the farmers started to realize 629 00:30:13,897 --> 00:30:16,608 that prices are going down they start to give up tapping. 630 00:30:16,650 --> 00:30:19,987 They said they want to chop it and remove the trees. 631 00:30:20,028 --> 00:30:22,281 I think that is something 632 00:30:22,322 --> 00:30:27,286 not very acceptable to the global rubber economy. 633 00:30:27,327 --> 00:30:30,789 - So the farmer says the factory sets the price. 634 00:30:30,831 --> 00:30:35,002 But then the factory says the futures traders set the price. 635 00:30:35,043 --> 00:30:36,878 And the futures traders say 636 00:30:36,920 --> 00:30:40,465 global inflation and recession sets the price. 637 00:30:40,507 --> 00:30:43,260 Amidst all the finger pointing, how are the farmers 638 00:30:43,302 --> 00:30:46,305 supposed to survive any of this volatility? 639 00:30:48,682 --> 00:30:50,434 Wouldn't it be stupid of them to continue manufacturing rubber? 640 00:30:50,475 --> 00:30:53,478 - We always encourage the farmers 641 00:30:53,520 --> 00:30:55,188 start to look for alternate incomes, 642 00:30:55,230 --> 00:30:56,607 keep the plantation alive, 643 00:30:56,648 --> 00:30:58,734 because the prices are moving on a cycle. 644 00:30:58,775 --> 00:31:00,193 There are up cycles, we have seen it. 645 00:31:00,235 --> 00:31:01,570 There are down cycles. 646 00:31:01,612 --> 00:31:02,863 And now we're still going in the down cycles. 647 00:31:02,904 --> 00:31:04,948 And after the down cycle finishes, 648 00:31:04,990 --> 00:31:06,992 the next up cycle will come. 649 00:31:07,034 --> 00:31:09,369 So it's a matter of price oscillation. 650 00:31:09,411 --> 00:31:10,829 - Okay. 651 00:31:10,871 --> 00:31:13,874 Is leaf blight a real threat to rubber trees? 652 00:31:13,915 --> 00:31:15,917 - I think... well... 653 00:31:15,959 --> 00:31:17,711 it is a real thing. 654 00:31:17,753 --> 00:31:20,756 However, I think we will leave this problem 655 00:31:20,797 --> 00:31:22,883 to the plant doctors. 656 00:31:22,924 --> 00:31:25,886 Because, you know, there is not really a remedy on this, 657 00:31:25,927 --> 00:31:28,180 but I think nothing is worse than... 658 00:31:28,221 --> 00:31:29,931 the farmers that want to chop it down. 659 00:31:29,973 --> 00:31:31,892 Because once you chop the trees, 660 00:31:31,933 --> 00:31:33,518 that's the end of the story. 661 00:31:33,560 --> 00:31:35,354 - So you think the farmers 662 00:31:35,395 --> 00:31:36,897 - are the greatest threat to the-- - Yes. Correct. 663 00:31:36,938 --> 00:31:38,732 The farmers are the greatest threat. 664 00:31:38,774 --> 00:31:41,360 When they start to give up in the business, in the industry, 665 00:31:41,401 --> 00:31:43,737 they refuse to tap, they want to chop it... 666 00:31:43,779 --> 00:31:46,323 or they just want to keep the plantation dormant. 667 00:31:46,365 --> 00:31:48,825 I think that is the biggest threat. 668 00:31:50,452 --> 00:31:52,954 - As essential as rubber is, you'd think the market 669 00:31:52,996 --> 00:31:55,749 would do everything in its power to protect the supply. 670 00:32:07,344 --> 00:32:09,388 This is Ma Nui. 671 00:32:09,429 --> 00:32:11,139 She's a rubber farmer in Thailand 672 00:32:11,181 --> 00:32:14,768 and what Dar Wong refers to as the greatest threat. 673 00:32:16,895 --> 00:32:18,605 Cutting down her rubber trees 674 00:32:18,647 --> 00:32:20,941 in the hopes to eventually build a modest cottage 675 00:32:20,982 --> 00:32:25,612 for a better income is what she sees as her only option. 676 00:32:25,654 --> 00:32:30,951 Is it hard to make decisions like cutting down the trees? 677 00:32:30,992 --> 00:32:32,327 Or do you see it 678 00:32:32,369 --> 00:32:35,747 as just part of changes that have to happen? 679 00:32:35,789 --> 00:32:40,335 - I don't have the money to change or grow other things. 680 00:32:40,377 --> 00:32:43,755 So, there is nothing else I can do. 681 00:32:43,797 --> 00:32:47,300 It doesn't matter what I think of doing, you know? 682 00:32:47,342 --> 00:32:50,679 I don't have the money to grow anything. 683 00:32:50,721 --> 00:32:51,972 - I understand. 684 00:33:00,814 --> 00:33:05,652 Ma Nui exemplifies the plight of many rubber farmers. 685 00:33:05,694 --> 00:33:07,738 They're caught in the middle of a system 686 00:33:07,779 --> 00:33:09,614 that's more concerned with stopping them 687 00:33:09,656 --> 00:33:12,159 from destroying their trees than the loss 688 00:33:12,200 --> 00:33:15,579 of the entire rubber industry to leaf blight. 689 00:33:15,620 --> 00:33:17,998 Meanwhile, we're buying the latest running shoes 690 00:33:18,039 --> 00:33:19,833 with no clue that the whole system 691 00:33:19,875 --> 00:33:21,668 might run off a cliff at any moment. 692 00:33:26,089 --> 00:33:29,426 If disease and economic disaster won't make the markets act, 693 00:33:29,468 --> 00:33:32,053 are we just totally screwed? 694 00:33:32,095 --> 00:33:34,389 Will the spectacle of monster truck rallies 695 00:33:34,431 --> 00:33:36,600 go the way of pole sitting contests? 696 00:33:39,519 --> 00:33:41,855 The invisible hard of the free market may be turning 697 00:33:41,897 --> 00:33:44,608 a blind eye to the issue, but private industry 698 00:33:44,649 --> 00:33:47,778 is starting to take some baby steps to cover their assets. 699 00:33:52,282 --> 00:33:53,992 That takes us to the very last step 700 00:33:54,034 --> 00:33:57,037 in the rubber supply chain, a very important researcher 701 00:33:57,078 --> 00:34:00,040 named Carla in a tire factory in Germany. 702 00:34:03,043 --> 00:34:06,129 Continental Corporation, one of the world's oldest 703 00:34:06,171 --> 00:34:08,507 and biggest automotive companies, 704 00:34:08,548 --> 00:34:10,550 is looking to develop mass quantities 705 00:34:10,592 --> 00:34:12,385 of an alternative kind of rubber. 706 00:34:12,427 --> 00:34:14,888 - [Carla] It smells like harvesting carrots, isn't it? 707 00:34:14,930 --> 00:34:19,100 - Yeah, almost like an indica carrot sort of a smell. 708 00:34:19,142 --> 00:34:20,894 Huh. 709 00:34:22,270 --> 00:34:24,064 Continental has an annual revenue 710 00:34:24,105 --> 00:34:26,566 of nearly $50 billion at risk. 711 00:34:26,608 --> 00:34:29,277 - What is this made from? - From dandelion roots. 712 00:34:29,319 --> 00:34:30,654 - Whoa. 713 00:34:32,405 --> 00:34:34,616 Taraxacum kok-saghyz. 714 00:34:38,703 --> 00:34:41,122 Continental is betting on the dandelion 715 00:34:41,164 --> 00:34:43,959 as a potential game changer in the rubber industry 716 00:34:44,000 --> 00:34:47,087 because unlike the rubber tree, dandelions are able 717 00:34:47,128 --> 00:34:49,673 to be grown annually in moderate climates 718 00:34:49,714 --> 00:34:52,843 and in soil that's not even suited for cultivation. 719 00:34:52,884 --> 00:34:56,054 Dandelions are resilient. 720 00:34:56,096 --> 00:34:58,431 Carla Recker is the one spearheading the effort, 721 00:34:58,473 --> 00:34:59,975 and she's all business. 722 00:35:04,312 --> 00:35:07,107 So how many trees, if you're using 723 00:35:07,148 --> 00:35:09,359 the traditional rubber trees, would it take 724 00:35:09,401 --> 00:35:11,945 for one tire versus how many dandelions? 725 00:35:11,987 --> 00:35:14,573 - A rubber tree approximately produces one 726 00:35:14,614 --> 00:35:17,450 to one and a half kilograms natural rubber per year. 727 00:35:17,492 --> 00:35:19,286 - For one tire? 728 00:35:19,327 --> 00:35:21,121 - For the one tire, you need almost two, two trees. 729 00:35:21,162 --> 00:35:22,789 - And what about dandelions? 730 00:35:22,831 --> 00:35:24,332 - It's not the plants which count there. 731 00:35:24,374 --> 00:35:26,835 It's just the acreage which is used for that, 732 00:35:26,877 --> 00:35:30,714 and our goal is to have the same yield per hectare in a year 733 00:35:30,755 --> 00:35:32,674 like a rubber plantation. 734 00:35:32,716 --> 00:35:34,634 - Can you talk to me about the differences 735 00:35:34,676 --> 00:35:36,511 in how you source it? 736 00:35:36,553 --> 00:35:39,806 So I know that for a rubber tree, 737 00:35:39,848 --> 00:35:42,183 you tap the tree and the substance comes out. 738 00:35:42,225 --> 00:35:43,894 They collect it in cups. 739 00:35:43,935 --> 00:35:45,145 But what's it like with dandelions? 740 00:35:45,186 --> 00:35:46,730 You just tap the dandelion and-- 741 00:35:46,771 --> 00:35:49,190 - No, that will not work because where the natural rubber 742 00:35:49,232 --> 00:35:51,234 in a dandelion is is in the roots. 743 00:35:51,276 --> 00:35:53,069 -So that's underneath the soil. - It's in the root. 744 00:35:53,111 --> 00:35:54,571 - It's under the-- - It's in the root, yeah. 745 00:35:54,613 --> 00:35:56,197 Therefore, you need a process which works. 746 00:35:57,699 --> 00:35:59,242 - [Kal] Getting rubber from a dandelion 747 00:35:59,284 --> 00:36:02,579 isn't as simple as notching a tree. 748 00:36:02,621 --> 00:36:05,373 We're talking about thousands of plants that need to be 749 00:36:05,415 --> 00:36:09,294 cultivated, harvested, and then their rubber extracted 750 00:36:09,336 --> 00:36:11,087 through a complicated process 751 00:36:11,129 --> 00:36:14,257 involving both human and machine. 752 00:36:14,299 --> 00:36:16,927 - So here are the dry roots. It's very brittle. 753 00:36:16,968 --> 00:36:20,305 And you can break it, and you see it still keeps together. 754 00:36:20,347 --> 00:36:22,223 And then between, in the slit, you can observe 755 00:36:22,265 --> 00:36:24,935 the very tiny strands of rubber which are inside. 756 00:36:24,976 --> 00:36:27,896 - [Kal] Continental has sunk significant capital 757 00:36:27,938 --> 00:36:29,397 into doing this. 758 00:36:29,439 --> 00:36:31,399 - And that is what you have to separate out 759 00:36:31,441 --> 00:36:33,860 by such a process, and then you get this beautiful material. 760 00:36:33,902 --> 00:36:36,947 - [Kal] All in the hopes that this will pay off. 761 00:36:36,988 --> 00:36:38,657 You've already made tires out of dandelions, right? 762 00:36:38,698 --> 00:36:40,533 - [Carla] Right. 763 00:36:40,575 --> 00:36:42,869 - Is there anything you're worried about in this process? 764 00:36:42,911 --> 00:36:47,040 - Oh, you can worry about a lot of things being in that process 765 00:36:47,082 --> 00:36:49,542 because we always are faced with problems every year. 766 00:36:49,584 --> 00:36:51,836 You have too much rain, too less rain. 767 00:36:51,878 --> 00:36:55,090 So you have all to handle this kind of agricultural risk, 768 00:36:55,131 --> 00:36:57,217 which a farmer does every year. 769 00:36:57,258 --> 00:36:58,718 But we have to learn that because we are 770 00:36:58,760 --> 00:37:00,720 a rubber company and not a farming company. 771 00:37:00,762 --> 00:37:04,766 - How did Continental decide to invest in dandelion rubber? 772 00:37:04,808 --> 00:37:06,393 Was that you? 773 00:37:06,434 --> 00:37:07,978 - I convinced the company to do so. 774 00:37:08,019 --> 00:37:10,730 - How do you convince a huge global conglomerate 775 00:37:10,772 --> 00:37:12,691 to invest in flower rubber? 776 00:37:12,732 --> 00:37:15,068 - Yeah, you have to be, on the one hand side, enthusiastic, 777 00:37:15,110 --> 00:37:17,946 but you have to have reasons for being so. 778 00:37:17,988 --> 00:37:20,031 The future of natural rubber is essential for us 779 00:37:20,073 --> 00:37:22,200 because the demand is still growing, 780 00:37:22,242 --> 00:37:25,412 like the tire market is growing and expected to grow. 781 00:37:25,453 --> 00:37:28,039 And that's the reason why we have to secure your own supply, 782 00:37:28,081 --> 00:37:29,499 and therefore, we have to start now. 783 00:37:29,541 --> 00:37:31,459 - Do you have a nickname here? 784 00:37:31,501 --> 00:37:35,422 - (laughs) Some people call me (speaks in foreign language) 785 00:37:35,463 --> 00:37:37,048 - or Miss Dandelion. - Miss Dandelion? 786 00:37:37,090 --> 00:37:38,508 That's cool. 787 00:37:38,550 --> 00:37:41,302 - It's not very much used. 788 00:37:45,056 --> 00:37:46,850 We have Taraxacum tires here, 789 00:37:46,891 --> 00:37:50,353 the blossoms of the Taraxacum here, and the seats. 790 00:37:50,395 --> 00:37:53,023 This is the logo, how it looks like when it's on a tire itself. 791 00:37:53,064 --> 00:37:55,483 - So whenever you see that-- - That's what that is, yeah. 792 00:37:55,525 --> 00:37:57,027 - At a future time in the market, 793 00:37:57,068 --> 00:37:58,403 then it is a Taraxacum tire. 794 00:37:58,445 --> 00:37:59,946 - Oh, that's exciting. 795 00:38:02,991 --> 00:38:04,909 I was reading that you guys are within five to 10 years 796 00:38:04,951 --> 00:38:07,203 of being able to produce this industrially. 797 00:38:07,245 --> 00:38:09,914 - Is that on track? - That's what we are working on, 798 00:38:09,956 --> 00:38:12,208 but we have still a long way to go until we will be successful 799 00:38:12,250 --> 00:38:14,127 into having that industrialized. 800 00:38:14,169 --> 00:38:17,714 So I will not say that we will have solved the rubber crisis 801 00:38:17,756 --> 00:38:19,424 for the whole world, but if we don't start now, 802 00:38:19,466 --> 00:38:22,719 we will never be able to solve that problem. 803 00:38:22,761 --> 00:38:25,847 - [Kal] Since markets don't seem like they'll save us 804 00:38:25,889 --> 00:38:27,849 and there's no massive global collective action 805 00:38:27,891 --> 00:38:29,017 to cure leaf blight-- 806 00:38:29,059 --> 00:38:30,477 - Hi. - Hey. 807 00:38:30,518 --> 00:38:32,312 Maybe dandelions are the future lifeblood 808 00:38:32,353 --> 00:38:34,147 of the global economy. 809 00:38:34,189 --> 00:38:36,983 We're betting that the success of a few scientists 810 00:38:37,025 --> 00:38:39,486 can create a global market for these small yellow flowers 811 00:38:39,527 --> 00:38:42,322 in time to prevent a calamity. 812 00:38:42,363 --> 00:38:44,532 Let's keep our fingers crossed 813 00:38:44,574 --> 00:38:47,577 that we will be saved by another cycle of capitalism, 814 00:38:47,619 --> 00:38:50,038 continually spinning round and round 815 00:38:50,080 --> 00:38:54,501 like, uh, like, uh... 816 00:38:54,542 --> 00:38:56,920 I wish I could come up with a handy metaphor for this. 817 00:38:56,961 --> 00:38:58,922 (rock music) 818 00:39:02,550 --> 00:39:04,886 Hopefully, things will turn out okay. 819 00:39:06,513 --> 00:39:09,015 Maybe the rubber industry can be saved 820 00:39:09,057 --> 00:39:12,352 and we can continue to wear shoes, 821 00:39:12,393 --> 00:39:16,564 eat food, and enjoy Monster Jam. 822 00:39:16,606 --> 00:39:18,024 But we'd better buckle up, 823 00:39:18,066 --> 00:39:19,734 because it might be a bumpy ride. 824 00:39:22,946 --> 00:39:24,114 (upbeat rock music) 825 00:39:46,177 --> 00:39:48,138 - [Woman] Mark. - Hey, if you buy 'em, 826 00:39:48,179 --> 00:39:50,140 you can take the records too. (chuckles) 827 00:39:50,181 --> 00:39:53,226 I'm not-- That's an armrest I'm sitting on. 828 00:39:53,268 --> 00:39:56,020 I overshot that chair. My apologies. 829 00:39:56,062 --> 00:39:57,522 - Ha-ha-ha. 830 00:39:57,564 --> 00:40:00,316 - Fuck. (laughs) Where do I start? 831 00:40:00,358 --> 00:40:02,402 - I tell you what. I guarantee, 832 00:40:02,443 --> 00:40:04,487 if I don't see this show, I'ma lose my shit. 833 00:40:04,529 --> 00:40:05,989 I'm talking about onto the floor. 834 00:40:06,030 --> 00:40:07,991 It's gonna be not good for anybody. 835 00:40:08,032 --> 00:40:09,450 Literally, splat. 836 00:40:09,492 --> 00:40:11,119 I will lose my shit. 837 00:40:11,161 --> 00:40:12,662 I'm gonna have to start wearing a diaper. 838 00:40:12,704 --> 00:40:14,080 That's crazy. Did you shit on the floor? 839 00:40:14,122 --> 00:40:16,416 Who did that? My bad, I'm sorry. 840 00:40:16,457 --> 00:40:18,168 (Meghan giggles)