Monday, January 31, 2011

Chart Week: Renewable Energy, Oil and the Mideast

Here is "the story" about the current state of renewable energy, oil and the relative importance of the Mideast supplies of oil. I think these charts are self-explanatory:








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Saturday, January 29, 2011

The Big Squeeze, Part 3: The Quiet Rebellion: Civil Disobedience, Local Markets, and Debt Erasure

I am pleased to present Part 3 of a uniquely clear-sighted three-part series by frequent contributor Zeus Y. on the consequences of our corrupt financial-political Status Quo being exploited by a parasitic Financial Elite.



Part III: The Quiet Rebellion: Civil Disobedience, Local Markets, and Debt Erasure


The collapse of elite authority and rise of democratic civil disobedience will come, but I think it will look very different than most expect. Given the tumultuous play-out of current conditions, one might imagine comprehensive, violent upheaval. There will be widespread and numerous local and regional examples of violence, John Brown style uprisings, especially in the worst hit areas. However, the overall rebellion will be mostly “quiet,” I believe. It is likely to commence as something far more sedate and private than a global public bloodbath. Moreover, it will be driven less by principle than by practical recognition and necessity.


Eventually, organized creative resistance and alternatives will emerge, but they will stem from widespread exhaustion in both senses of the word as in “used up” (environmental resources gone, savings gone, pensions gone, employment gone, retirement gone, American Dream gone), and in terms of “fatigue”. People will become too damn tired emotionally, physically, financially, and psychologically both to fight and to continue supporting a system that is sucking far more than it is providing.


The rebellion will start as individualistic refusal and grow into something more interconnected, social, and affirmative over time. People will in increasing numbers stop paying their taxes and their mortgages, refuse to buy (stocks, goods, etc.), take their money out of banks, and so forth.


From an October 24 email to Charles Hugh Smith:

[Citizen rebellion] will [start as] a kind of civil disobedience that looks like apathy and complacence, but will be actually closer to disconnection and non-cooperation, and subtle sabotage one finds at workplaces with intelligent, productive, but poorly treated employees.


These employees know they are getting screwed. They know their bosses and owners are venal... They know they have no leverage to raise their wages, and that performance boosts on their parts will be rewarded with more exploitation and skimmed and highjacked productivity. So what will they do?


“Okay, two can play that game.” You abuse me and my productivity. I'll make it look like I am doing everything I'm supposed to, but I'm actually taking what I can out of the company, from office supplies, to internet time doing other things, to, you name it.


I think [strategic] mortgage defaults might follow this same pattern… The salt-of-the-earth types still have some integrity and desire to “do the right thing” but if doing so enables them to get screwed more and rewards vicious behavior, the new moral mandate with integrity is to do the conventionally moral “wrong” thing, so as to punish the evil-doers and to prevent self-abuse.


I described how this might evolve in another email to Charles Hugh Smith on October 13 in a post entitled “An Unintentional Prophecy” that extended a reader response I made to Gonzalo Lira’s well-known post on hyperinflation:

I have long argued (and laid out in some frameworks) how we are being forced in an accelerated fashion to move value from a material (including gold, commodities, etc.) to a non-material basis of meaning. We have overcapacity technologically to produce food, but undercapacity to distribute it in a way the optimizes well-being rather than reinforcing misery. "Disconnected" profit acts like a cancer, hypercharging certain parts of the system and impoverishing other parts.


You cannot eat gold, nor even commodities that are not in your refrigerator or your pantry. What value do these have? Since the central states and their paymasters (the financial elites) will fail, what takes its place? Most of the scenarios offered are of a survivalist bent, but I see this myopic, constrained guess … rather than an outflow of keen, intuitive grasp of the possibilities.


When Y2K came, the world did not end. When New York City blacked out, people milled around… rather than storming the grocery stores. Fact is, financial collapse will leave us to our own devices, and we will have to invent. We have some tools: local currency, barter, microfinance, in which productivity can be linked back to (locally driven, globally linked) economic enterprise, and real quality of life can emerge as present- and people-directed, rather than future- and "disconnected profit"-directed, which (by and for itself) is nothing more than an agreement to exploitation and imbalance.


Connected profit, in conjunction with people and planet (triple bottom line) can be transformed into a quality-of-life value-added marker, rather than a power grab and concentration. We are coming to the big face-off between top-down control by those who would be gods over us and impose value on us, and bottom up creativity which recognizes that any “god” (energy, good, intelligence) comes up through us and is connected between us. It is this “within” and “between” well-negotiated and exchanged that produces real value.


We are reaching the limits of physical exploitation and growth (as shown by its effects on environmental health). We need to transfer that growth and “frontier” mentality to non-scarce, non-material assets like learning, intellect, culture, music, community, family, creativity, human connection and interest. This cannot happen until the grip of the former is dashed by its own means, by its own unraveling. This is now happening.


This may look like pure idealism to some and capitulation to those observers needing cathartic overturn of the old system, but it will be in reality the acceptance of the death of an era, and the start of an open and creative building of the next. Quality of life must migrate by practical necessity from worth determined by material wealth and monetized value toward worth in which non-material harbingers of value— learning, community solidarity, multicultural experience and exchange, environmental advocacy, etc— become the mainstays of a good life.


Those websites talking about purely individual responses to catastrophe, for instance, those suggesting stocking up on physical silver and gold, and using it to trade for your necessities, will ultimately look foolish. How will this solve the systemic problem? What merchant will accept on faith that what you hold is real? Your “silver” ingot could simply be coated zinc. Is that grocer going to take out a test kit and a drill? Trade will be in currency, but mainly locally-based paper currency backed by local goods, faith, and productivity. Medium-sized cities (like a Madison, WI or an Ithaca, NY) near farmland and colleges with a well-educated progressive populace, farmer’s markets, and a vitally functioning social infrastructure and comity will probably do best.


This movement will be driven by the younger, Generation X and millennial generations. Educated, well supported, idealistic, pragmatic, socially and multiculturally experienced, (and with lots of time on their hands) they face a world in which they have few to no job opportunities, huge debts, deteriorated expectations, a polluted future, and increased burdens to take care of the older generations. They don’t believe the promises of future return they’ve been sold, nor should they.


In addition they are increasingly multi-ethnic, multi-cultural, and global in perspective, less motivated or swayed by nationalistic or racist tensions. Their loyalties are more to their own interconnected experience than brands, flags, or classes. They are smart as a group and very able to work collaboratively and effectively as seen in their impressive participation in the Obama campaign (before Obama completely dismissed them).


Baby boomers may follow, but probably only after initially resisting, and trying to make the system work long enough so they can cash in their corporate 401(k)s and extract their welfare state entitlements. Additionally, baby boomers’ identity is more deeply motivated by heroic individualism over shared service. The boomers’ deep-rooted hope for the material American Dream is likely to extend the time line for a global coming-to-terms with an obsolete system, but eventually they will have to capitulate, find a renewed purpose, dust off their 60’s idealism, and reapply themselves.


On a grand scale the only way to erase counterfeit money and assets of hundreds of trillions of dollars is to erase the debts associated with those fake assets. (Let me underscore again, these are not “toxic” assets, they are fake assets.) In one way or another, this will have to happen. What about those homeowners who bought more than they could afford, will they get off scot-free? The answer is, “not entirely,” though full responsibility and accountability is likely to take on a new face.


Zeal for imprisonment of the fraudsters and the comeuppance of the loose spenders will likely yield to a requirement for defrauders and debtors to return fully what they have taken plus interest through financial compensation and in-kind pro-social work (not pennies on the dollars like the present situation). Though this would not exactly involve breaking rocks with a sledgehammer, it would help build up an infrastructure badly in need to renovation.


Forgiveness in general, and forgiveness of debt in particular, stand as virtues if they free us up to acknowledge, address, and learn from our culpability, start anew, and create forward. There will still be a necessity for systems of prosecution and restorative justice to prevent abuse. However, giving to society, whether to correct a wrong or to simply contribute as a concerned citizen should not be viewed as a punishment. It can, and should be seen, both as a social necessity and a personal avenue for fulfillment.


We will have turned the corner when contribution to our collective well-being is not seen as an obligation but an opportunity, and exploiting others is understood not as an opportunity but a crime.


By Zeus Yiamouyiannis, Ph.D., copyright January, 2011


The Big Squeeze, Part 1


The Big Squeeze: Part 2: Abused Fundamentals and Fake Markets: How They Play Out


Other recent essays by Zeus on oftwominds.com:


When The Market Has Cancer (June 19, 2010)


Unhinged: When Concrete Reality No Longer Matters to the Market (and What to Do About It) (May 15, 2010)


How the Credit Default Swap Scam Works (October 13, 2008)


If you would like to post a comment, please go to DailyJava.net.


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Friday, January 28, 2011

The Big Squeeze, Part 2: Abused Fundamentals and Fake Markets: How They Play Out

I am pleased to present Part 2 of a uniquely clear-sighted three-part series by frequent contributor Zeus Y. on the consequences of our corrupt financial-political Status Quo being exploited by a parasitic Financial Elite.



Part II: Abused Fundamentals and Fake Markets: How They Play Out


So we have a lawless system. What does this mean for citizens and investors? In the near term it means that the fundamentals will not apply. Anything that maintains or augments elite wealth and increases elite options will be supported, and anything that consumes or converts common people’s wealth and labor and restricts their choices will be pursued. Anything that reinforces accountability, rational response, or cause and effect will be actively suppressed. Forget reversion to the mean. One only has to observe where the respective value/wealth of each party resides and where it gets channeled to know what the market will do and where policy will go.


When the stock market should crash, it won’t… until some time frame far longer than even the most generous fundamentals would dictate. I said as much to Charles Hugh Smith in an October 17, 2010 email entitled Stealth Monetization Keeping Market Up With Stock Buybacks, and so far I have been right on the money:

I've seen different parts of this puzzle in various articles, but here is why the stock market will remain artificially boosted until the mortgage fraud mess really gets cranked up. Just like the Fed lends to banks at 0% interest as a way to funnel money back to purchasing low-interest T-bonds, creating an artificial demand (and guaranteed profit), and goosing the market there (and staunching the exodus of foreign money), so too can money be funneled through banks from the Fed to corporations who use it to buy their own stock, effecting the same scenario. I believe this is happening now, and will likely happen more if there is a QE2.


Corporations will love it, because CEOs know that stock increases, no matter how you get them, mean big bonuses. [T]hey will, if anything attempt to hyper-accelerate low-interest money flow into their books and on to the stock sales block. How long that charade can persist is anyone's guess, but if you can have insolvent, zombie banks making "profits," and handing out, what, $144 billion, just in bonuses...


The more extreme the hubris, the more ridiculous the momentum, and the more spectacular the crash. These guys think they can defy gravity, and so far they have [been able to] with a lot of help. When the natural laws of finance kick in is anyone's guess, but I see (the Dow Index) as I originally predicted, to be 11,000 to 12,000 (un)til at least March (2011), a shakeup, and some panicked back door bailout to obscure the fundamentals again until September/October (of 2011).


These guys are too arrogant, too insulated, and too single-minded to do anything other than attempt to force the world into their boxes. At a certain point it will quit, but that only happens when things get very unmasked. The mortgage fraud cases are the key, but those will be stonewalled. These guys are tenacious because they are hanging by a thread of testosterone. Tick, tock.


Analyses that try to predict near term market moves based on Laffer curves, Elliot Waves, and historical cycles will almost definitely fail. We don’t have a “new era”, but we definitely have unprecedented coordinated global intervention dedicated almost solely to the fortunes of the top 1%. That is the new rule that will govern until there is a serious breakdown. Warren Buffet got this insight after the financial crash in 2008. He knew the government was going to step in to save and subsidize the big banks so he swooped up their stocks, garnering himself a hefty tax break in the process.


In the near term, independent shorters will be routinely and consistently routed through market manipulation and collusion between large corporations and their government policy clerks. JP Morgan allegedly manipulates the silver market for its own profit, but also does so to keep fiat currencies stronger. Feeling they benefit, major world governments will refuse to prosecute and, indeed, actively collude for reasons of “monetary security.” However, if you happen to be JP Morgan, holding massive short positions on silver, and you get challenged by a coordinated democratic effort to “crash JP Morgan, buy silver”,then you simply offload your short positions into unregulated institutions and buy up the copper market.


Here are some of my predictions in line with this rich-get-richer-and-the-rest-of-us-pay near to medium-term trend:


  • The stock market will remain artificially high, between 11,000 and 12,000 with possible dips (7,000 - 9,000) and spikes into the 14,000 - 16,000 range, before running into serious trouble in September/October 2011 (lower probability and acuteness) and/or September/October 2012 (much higher probability and acuteness)
  • Wages will remain flat or decline, unemployment and underemployment will remain high, and the power of labor will erode further as unions continue to throw their younger members under the bus to fund entitlements and benefits of their older members. Worldwide labor will be cheaper, providing a near term boost to corporate profits (counteracted eventually by buyer revolt).
  • Sales numbers will disappoint indefinitely, making stocks of retail stores a very bad buy. Even the Wal-Marts will take a hit. People simply don’t have the money even for cheap luxuries. Dollar stores on the other hand will continue to do very well because the provide soap, paper, spices, etc. for a very cheap price. In economics, it’s called “substitution.” To the middle class and working classes it’s called “survival.” This will not stop the GDP numbers from rising, being recalculated, and being manipulated with debt-fueled government spending.
  • The middle class will continue to stay away from the housing and stock markets in droves through a combination of low income, lack of trust, and just plain angry refusal. This, in addition to baby boomer liquidation for retirement will put serious pressure on the Dow. This will be mitigated somewhat by those same baby boomers accepting that they will be working at least part-time until they die.
  • Middle class purchasing power will continue to be eroded as costs of necessities (food, water, fuel, health care, etc.) rise by several factors above inflation, and durable middle class assets (housing, savings) deflate in value. The material American Dream will become a distant ideal.
  • Scandals and finger pointing will erupt around the management of public pensions as it is discovered that pension managers have colluded with states and corporations to hide losses and true value of assets. CALPERS, the 200 billion dollar California public pension will be ruled effectively bankrupt, due to a combination of extravagant liabilities and collapsed high-return junk assets. Investment rating systems will, as a result, come under renewed scrutiny to no effect.
  • Metal markets will continue to be suppressed, even as countries and wealthy individuals and organizations buy them up as a hedge. Monetizations of debt, currency devaluations, will continue unimpeded. Other commodities, like rice, will experience huge volatility leading to huge price swings and escalating social unrest and resentment as investor parasites try to accentuate these swings for their own profits.

  • There will be serious talk of and moves toward a world currency and global accounting standards to establish a level “playing field” and keep nations from trying to undercut each other’s currency through trade policies and cooking their books. This will be treated with a combination of alarm (by libertarians) and derision (by progressives) as observers will joke that now governments are trying to “be consistent in the way they break the law and steal from their people.”



    The Role of Savings


    Why is savings so important? In short, savings are the holy grail. On the opportunism side, savings represent hundreds of trillions of dollars of stored wealth, just ripe for the plundering. On the supervisory side, savings are the last reality hedge. Savings provide the annoying anchor for financial sanity and fundamentals, and serve as a barrier to exploitation, outright debt peonage, and monetary tyranny.


    I’m defining savings as any stored real, productive value: money in a savings account, paid-down house, gold, land, a business, etc. Savings have utility. Savings can be exchanged or used to purchase material needs and wants or make room for the non-material, experiential elements of the good life—time, leisure, education, travel. In order to make a financial coup complete, savings have to be rounded up and led to the slaughterhouse.


    Meaningful, value-backed savings means autonomy and choice, and autonomy/choice represents power, ability resist, to “choose other” than what some financial power wants from you, your money, and your productivity. Restricting consumer choice is absolutely essential to maximizing corporate profit, since low quality and high prices improve profits short-term but deter consumption medium-term for uncaptured market players. Without personal savings that can be maintained, stored, and accessed a person has no leverage in their own finances nor in their ability to “vote” as an economic citizen. One is merely a debt slave.


    It appears prevailing powers will go to any length to prostitute themselves against any true price discovery that would reward savers. Reversion to the mean, trading volume, velocity of money, margin, etc. all mean nothing when you can simply pour in an infinite amount of counterfeit currency. Along with this, it becomes almost impossible to assess and determine what is counterfeit because the official numbers, formulas, and information upon which accountability rests have been so distorted and obscured as to make value determination impossible (see calculation trends in employment numbers, inflation base line, etc.). Political pressures and decisions have simply caused a regauging of “undesirable” numbers to make it look like there is no problem.


    Profit used to be an engine of savings and investment, the oil of small business, entrepreneurialism, and a growing economy. In the current global situation most profit has turned cancerous. It has simply come to mean parasitic wealth extraction. If I can profit by debasing your savings or forcing my debts on to your books, and you accept it as necessary to keep the system you’ve invested in from collapsing, I can control you and your future opportunities.


    In short, I now possess your power as a citizen. This is why Thomas Jefferson was so clear about everyone owning property. One’s own means of support is necessary if a corrupt government emerges. One must be capable of refusing to participate, to exercise civil disobedience, and to be supported in a community significantly immune to upper-level manipulation.


    Historical economics are premised on observations of human behavior converted into “natural” laws and forces, given certain conditions. Those conditions are being actively and systematically subverted. We are now seeing human institutions and behavior operating as purely synthetic phenomena. There is no Adam Smith’s “hidden hand,” no collective rational self-interest, but rather devolution to leveraged control and power.


    We have the worst of neo-liberal state welfare, mixed with neo-conservative corporate welfare—a state for the corporation, and the corporation for itself. Citizens are being treated simply as productivity and investment batteries, like some twisted adaptation of The Matrix. With no protection from law or market fundamentals canny rational responses can be checkmated.


    By Zeus Yiamouyiannis, Ph.D., copyright January, 2011


    Tomorrow: Part III: The Quiet Rebellion: Civil Disobedience, Local Markets, and Debt Erasure


    The Big Squeeze, Part 1


    Other recent essays by Zeus on oftwominds.com:


    When The Market Has Cancer (June 19, 2010)


    Unhinged: When Concrete Reality No Longer Matters to the Market (and What to Do About It) (May 15, 2010)


    How the Credit Default Swap Scam Works (October 13, 2008)



    If you would like to post a comment, please go to DailyJava.net.


    Order Survival+: Structuring Prosperity for Yourself and the Nation or Survival+ The Primer from your local bookseller or in ebook and Kindle formats.

    Of Two Minds is also available via Kindle: Of Two Minds blog-Kindle


    Thank you, David H. ($50), for your marvelously generous contribution to this site-- I am greatly honored by your support and readership. Thank you, Mario M. ($150), for your stupendously generous contribution to this site-- I am greatly honored by your support and readership.

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    Thursday, January 27, 2011

    The Big Squeeze: Predicting the Effects of Savings Extortion and Abuse of the Middle Class

    I am pleased to present a uniquely clear-sighted three-part series by frequent contributor Zeus Y. on the consequences of our corrupt financial-political Status Quo being exploited by a rapacious Financial Elite.



    Part I: Oligarchy Becomes Anarchy


    Introduction


    By now it should be clear even to the most optimistic observer that the global financial system has given itself over to systemic lawlessness. Once international banks were effectively allowed to print their own money in an unregulated “shadow” system and have it redeemed full value by national taxpayers, the charade was over. The only thing left, at this point, given the full cooperation of governments and an eerie world-wide non-enforcement of law, is for banks, like a cancer to savage and consume every concrete store of non-counterfeit productivity and asset value.


    Not only have governments from China to the United States committed themselves to a chess game meant to eke out relative advantages on a sinking ship, but they have positively rewarded those who are speeding the collapse. A simple, cannibalistic economic rule now persists until a new system emerges: Economic manipulation, destruction, and extortion are simply more profitable, far more profitable, than good old fashion value creation. Disaster capitalism will be pursued full force.


    Whether a country is communist or capitalist, authoritarian or marginally democratic, no longer matters. Citizens globally have been made to be the pawns and patsies of a universal financial Ponzi scheme that can only end in carnage. Who cares if this insures debt peonage for the world and likely mass austerity, suffering, and shortages. There’s a buck to be made! Who cares if my own children will be choking on the garbage I spewed into the financial air and water system. I’m rich!


    When morality, reason, and sovereignty collapse together, we are left with outright anarchy, in everything but name. This is a reality so uncomfortable that hundreds of trillions dollars more of citizen retirement savings and other assets are likely to be tragically liquidated trying to regain stability and finance the “lean times” in the hopes of the promised upturn.



    Act I: Oligarchy Becomes Anarchy


    This anarchy and its suicidal impulse was brought to a head, but by no means started with, the collapse of Lehman Brothers and Bear Stearns. These crises did however confirm that the gatekeepers had become one and the same with the barbarians at the gate.


    The same story kept repeating itself and was easily predicted by the news accounts of single “rogue” traders damaging storied banks in England, France, and other countries in the past decades: The techno-nouveau riche found vulnerabilities in the “civilized” corruption and racketeering of the establishment banks. These vulnerabilities expanded and softened as banks adopted unfettered gambling as a way to produce huge profits. When gambling didn’t pay, scapegoats were identified and jailed, the sins of the system were larded on those individuals, and nothing changed systemically.


    Later, young guns armed with razor wits and high-powered computers saw that they could guarantee for themselves multi-billion dollar profits by not only betting on collapse but aiding and abetting (and even sometimes directly causing) a crash of the very banks they worked for or dealt with. Supported by a profit-by-any-means mentality, they simply took market manipulation to the next logical level, and a Pandora’s box of financial ills was loosed on to the world.


    Consider Lehman Brothers. As detailed in Danny Schechter’s movie Plunder, Lehman Brothers was brought down by a spate of naked short selling simultaneously coupled with exotic very short-term anonymous short positions worth hundreds of millions of dollars. One can conclude with high probability given the established dynamic that those who engineered this and profited enormously from it were former employees or colleagues of said employees who migrated to hedge funds.


    These players were insider enough to be privy to accounting tricks and frauds, the Repo 105 scams and so forth, being perpetrated by Lehman Brothers. They knew that Lehman Brothers was hiding gargantuan losses and skating on an illusory margin, so they devised a way to push them off the cliff by naked short selling and entrepreneurially betting on their own success. Why not teach the old farts a thing or two about their own game and laugh all the way to the proverbial bank.


    With the repeal of Glass-Steagall and the collapse of the walls between conventional banking, investment banking, investment rating systems, and government regulation, the financier class had completed its nefarious project, a fungible two-tiered economic system“unhinging” finances from concrete reality, productivity, and value creation.


    On one hand, a shadow banking system created hundreds of trillions of dollars ofcounterfeit wealth through the construction and leveraging of derivatives and mark-to-model assets. This was sold and exchanged for real assets, i.e. businesses and real estate. In addition trillions of dollars more in real wealth were siphoned off in transaction fees, bonuses, and profit taking. Financial, criminal, and civil liabilities were, and are still being, avoided through regulatory and governmental capture. On the other hand, infiltrated real value assets are being simply taken over: foreclosed upon, reassigned, and used as guarantees for this colossal fraud. Shadow liabilities are being hidden or shifted on to taxpayers’ bills.


    Unsurprisingly, hedge funds like Magnetar saw an opportunity to profit from this inequality under the law by lobbying banks to construct highly rated junk investment portfolios and then betting against those portfolios many times over. So you have the young amoral renegade side of the elite sparring with the crooked establishment side in what amounts to them as one big galactic video game. When they lose, they always have another life. When they win, they take home the money and the title. Someone else pays.


    It has to be noted that there is no personal stake in this game. Naked short selling, for instance, is phantom selling, selling shares you don’t actually own. Phantom buying, which is what is currently propping up the stock market, is using Fed-funneled money to buy up your own stocks. Risk has been removed from the system. There is only liability, profit, and power. Those of power and size taking great “risks” can leverage those risks into an extortion demand: “take our liabilities off our books, allow us to valuate them for as much as we want, and/or hide them for as long as we like or we’ll blow up the system.” Governments, with the exception of Iceland, said, “Please, financial terrorist, don’t do that. We’ll do anything you ask.”


    If free market capitalism existed and worked these banks would have been allowed to collapse, their losses eaten by bond and stock holders, and civil and criminal charges filed against institutions and individuals. However, to do so would have exposed the rot and common criminality in the interlinked global system. Accountability would have indicted the people and connections behind the curtain, so the entire anarchic enterprise has to be covered up and its costs shifted to taxpayers, in a vicious downward cycle, which only accelerates rapaciousness and irrational incentives and punishes savings and responsibility.


    Savings interest rates have been near zero for years, lower than inflation. Unemployment is high and people are liquidating their assets to pay for their costs of living. In addition, their future earnings and children’s savings being charged in advance for the multi-trillion dollar malfeasance of banks. Pensions are being looted and/or liquidated along with other real assets.


    The major U.S. banks, on the other hand, reported within quarters of the crash they created, that they were able to go through an entire quarter without a single losing trading day. That is pretty easy to do when so-called toxic assets are offloaded to the Federal Reserve for 100 cents on the dollar and when banks receive hundreds of billions of 0% interest rate money and turn around and buy Treasury bonds with 3% interest,“paying” taxpayers back with interest earned on the debt these same banks caused.


    No violations are too egregious or too pervasive for the Department of Justice or the SEC to ignore, no infraction too obvious or ridiculous to be covered up. These offices weakly go after the penny ante “bad apples” and keep a bubble system propped up and hopped up on its own version of financial adrenalin. A short laundry list of the most tragicomic examples:


    Fraudclosure: hundreds of thousands of mortgages being processed by robosigners, recorded and shifted around electronically, and their paper trails neglected or destroyed, contrary to even the most basic commerce and property laws. Not a single significant prosecution yet.


    Exchanges selling shares in precious metals without even having close to the reserves in physical metal to back up and JP Morgan’s “alleged”


    Mortgage insurers simply not paying their obligations.


    Multiple insurance on the same properties paid out in multipliers above the actual value of the property.


    Verified cases of houses being "foreclosed" upon that were already bought with cash.


    Same property sold to different owners.


    Extorted “marked to model” FASB standards fraud.


    With no effective reserve requirements, leverage limits, or accounting standards, institutions with power can simply make up any amount they choose. The above examples show how rampantly institutional entitlement has evolved to claim and sell any property they choose, and valuate and sell any instrument they conjure up.


    Power is all about access, and evidence shows where the current power resides. National governments in full collusion and cooperation with gigantic international financial corporations, have opened the floodgates of access to the “little people’s” wealth through bailouts, Fed policy, and quantitative easing, and clanged shut the castle door of the financial elite by allowing them to establish the value of thei r own assets and to concoct, rate, and sell almost any financial asset or instrument with no accountability, transparency, or enforcement.


    By Zeus Yiamouyiannis, Ph.D., copyright January, 2011



    Tomorrow: Part II: Abused Fundamentals and Fake Markets: How They Play Out


    Other recent essays by Zeus on oftwominds.com:


    When The Market Has Cancer (June 19, 2010)


    Unhinged: When Concrete Reality No Longer Matters to the Market (and What to Do About It) (May 15, 2010)


    How the Credit Default Swap Scam Works (October 13, 2008)


    If you would like to post a comment, please go to DailyJava.net.


    Order Survival+: Structuring Prosperity for Yourself and the Nation or Survival+ The Primer from your local bookseller or in ebook and Kindle formats.

    Of Two Minds is also available via Kindle: Of Two Minds blog-Kindle



    Thank you, James L. ($5/month), for your splendidly generous subscription to this site-- I am greatly honored by your support and readership. Thank you, Murphy Design ($100), for your sensationally generous contribution to this site-- I am greatly honored by your support and readership.

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    Wednesday, January 26, 2011

    Staying Fit (at almost any) Age

    Dr. "Ishabaka" shares some tips on staying fit ands maintaining motivation.



    Becoming fit and eating healthy food are the best preventative tools we have within our own control. One reason fitness and healthy cooking play such big parts on this site is that it is increasingly unlikely that the Medicare/Sickcare system will be around long enough to cure us of all our lifestyle-related diseases.


    In other words, we'll be on our own: we will need what I call radical self-reliance.Rather than hoping we can acquire enough gold or quatloos to fund costly healthcare for ourselves and our families in the future, the better alternative is to avoid as many chronic lifestyle-related illnesses as possible via fitness and healthy diet (i.e. eating real food only).


    Dr. "Ishabaka" is middle-aged and fit. In an email "conversation," we discussed the challenges of motivation, and the good doctor agreed to summarize his own experiences and what he's observed in others.


    The principles of fitness and nutrition apply to people of all ages, hence the inclusive title of the entry.


    Here are Dr. "Ishabaka's" suggestions:

    Today is January 5th. I hadn't exercised for 11 days, and gained 6 pounds over the holidays. Last night I decided it was finally time to do something, and set my alarm so I'd wake up early and be able to go to the gym. When the alarm went off this am I was SO tempted to turn it off and go back to sleep. I made my way to the gym - it was leg day, my least favorite exercise day. I felt like crap. My strength was down about 25%. Twice I felt like throwing up, and once like passing out. I managed to finish. How I did so is the subject of this article.


    I joined my gym four years ago, as a result of a New Year's resolution to get in better shape. Little did I know....


    Every January, the gym is packed. I often cannot use the equipment I want - someone else is using it. This lasts 4-8 weeks, then things go back to normal - which means most people who joined in the New Year GAVE UP! Why? Because they COULD NOT STAY MOTIVATED. I see this as THE number one issue in fitness in middle age.


    There are some lucky people who truly love to exercise. I presume none of them are reading this, so I'll dispense with them and address the rest of us, for whom exercise is mostly a chore.


    I think a major stumbling block is the concept of "getting in shape". It's sounds like a project you can accomplish and finish. I think it's better to plan on "staying in better shape" - it's a lifelong process. If you stop at any point - no matter how "in shape" you were - well, just take a look at this picture:



    Again, to repeat - it's a lifelong process. Also, the concept of "getting in shape" suggests that one is going to end up looking like a fitness model - which is impossible for 99% of the population. If you're thirty pounds overweight, and can only run one mile at 12 minutes per mile, losing twenty pounds and running two miles at 11 minutes per mile is definitely " getting in better shape".


    Another concept I find helpful is to compare overeating, eating unhealthy food, and lack of exercise to an addiction, such as alcoholism. There is no "cure". Improvement is possible in almost every case - but almost certainly, there WILL be relapses. Relapses are often very demoralizing, and quite difficult to overcome. Plan on them occurring.


    Here are some strategies and tips I have found useful:


    1. Try as many activities as you can before deciding what to concentrate on. Try and choose at least one aerobic, and one strength activity - your body needs both.


    2. Get a workout partner. This has helped me more than anything. If possible, choose someone who is fitter/more knowledgeable, and push each other. It's a lot harder to turn off the alarm clock if you've made an appointment to go running/biking/to the gym with your workout partner in the morning. A partner is particularly helpful when you relapse - that's why A.A. has sponsors.


    3. Join a class or a group. For some reason, women tend to do this and men don't. Again, you will have a pre-deter- mined time when you are supposed to exercise, and instructors and classmates to urge you on.


    4. Set goals for yourself. Write them down. Post them where you can see them (I tape mine to the bathroom mirror). I strongly believe in setting ACHIEVABLE goals. If you write down "lose 80 pounds", it's just too daunting, and you'll likely give up. Instead, write down "lose 6 pounds in 2 months". Unless you give up, you will almost certainly achieve this, and possibly lose even more than 6 pounds, which sets up what I like to call a "virtuous circle", the opposite of a "vicious circle". In a virtuous circle, success encourages further success.


    5. Increase the intensity of your exercise in small increments. If you can curl a 20 pound dumbell ten times when you start, don't expect to be able to curl a 50 pound dumbell in a month. Your initial goal should be to curl the twenty pound dumbell eleven times. The same goes for walking/running/biking/swimming speed and distance. Realize that if you curl that same 20 pound dumbell ten times for two years - you aren't going to make any progress. I call this "going through the motions", and it's surprising how many people at my gym do this. I think it's a form of self delusion: "Well, I worked out at the gym today", when the person really didn't push their body at all.


    One big hurdle many face - myself included - is what's called "delayed onset muscle soreness" or DOMS. This is muscle pain that comes on a while after exercise. In my thirties, I found it maxed out the day after. Now it's two days after. I wonder if it will be three days after in my sixties? It definitely helps to ease into exercising - the worst thing you can do is go crazy your first session, and wind up bed ridden for a week. Nonsteroidal anti-inflammatory drugs such as ibuprofen (Motrin, Advil) don't seem to help. Stretching may or may not help, depending on who you read. One thing I have found - it sounds counter-intuitive - is that it's best to resume exercising before all the pain is gone. If I wait till I'm 100% pain free, the cycle seems to just repeat itself. If I resume when the pain is mild - moderate, I seem to adjust, although I'm always a little achy somewhere.


    6. Enter a competition. This gives you a goal AND a time period in which to get in shape. I suggest a 5 kilometer (3.2 mile) run. They are held all the time just about everywhere. Even if you can't run non-stop for 5 kilometers, you can do what's called "run-walking" - run until you are tired, walk until you recuperate, then run some more. I guarantee you won't win your first 5k (and probably will never win one), but you won't be last - and you will get a cool finisher's t-shirt to wear, that will make people think you are really in shape!


    7. Spend the minimum amount of money possible, at least in the beginning. Sign up for a one or two month trial membership at a gym if you've never belonged to one - you don't know if you'll like it or not. Don't buy a $3,000 triathlon bicycle for your first triathlon - use your ten year old mountain bike. You're goal is just to finish.


    If triathlons turn out to be your thing, you can always buy the expensive bike later. The attics, basements, and second hand shops of America a littered with expensive exercise equipment people bought and abandoned.


    The ONLY exception I would make is shoes. I'm assuming people reading this are middle aged, and although we may say "Fifty is the new thirty", our bodies don't agree - they have fifty years of wear and tear on them.


    Slamming fifty year old feet (likely carrying excess poundage) in poorly cushioned, poorly supporting shoes, on concrete, over and over again, is likely to cause injury. Injury is perhaps the single most demoralizing thing that can affect a fitness program. For that reason, I suggest consulting a doctor first if you have, or are at risk of serious health problems, starting gradually, progressing incrementally, and NOT neglecting flexibility and balance.


    The number one cause for admission to nursing homes in the U.S. is falls, and maintaining good balance and flexibility will minimize the likelihood of a fall happening - and - if one does happen - the likelihood of serious injury.


    8. Finally, when I'm really demoralized, sometimes I'll tell myself "Just do some damn thing for a little while". Whether it be a thirty minute walk, one mile run, or half an hour at the gym, it's better than nothing, and seems to have a surprisingly positive effect on getting me out of a funk.

    Thank you, Doctor, for sharing your experiences and tips. Here are a few links and comments of my own on the subject.


    Stretching is good. Flexibility improves health, and stretching helps with back pain and other conditions. It's also a form of exercise, and the warmup provided by stretching often gets you in the mood for further exercise. Yoga, tai chi and chi gung also improve balance, which tends to degrade with age.


    Learning how to fall is good. I know Dr. "Ishabaka" is also a martial arts practitioner, and one of the most valuable things I have learned in martial arts is how to fall: lower your center of gravity, tuck your head down and roll.


    Muscle mass is a factor in cardiovascular health. Studies have shown that the quantity of muscle one builds and retains is a predictive factor in overall health. Walking is good, but keeping upper-body muscles requires more than walking.


    Avoid temptation by keeping your kitchen free of junk food and packaged snacks.If it's not around, you won't crave it as much. "You don't miss what you no longer want."


    Push yourself gently, don't hurt yourself. Wake up slowly, stretch, warm up, know your limits and push up to them but not past: common sense, to be sure. Patience and perseverence go hand in hand.


    Self-discipline is good. I have a number of "bad genes" as the men in our family are prone to heart disease, high cholesterol and high blood pressure. So it takes more work on my part to counteract these negatives. At 57, discipline is required.


    Avoid "sacrifice," seek positives. Americans are trained to worship instant gratification and ease. As a result, many see eschewing ice cream etc. as "painful sacrifices" and arduous exercise (which results in so little immediate gain) as equally painful and unpleasant.


    I don't think of what I'm setting aside; I "reward" myself if I fulfill my fitness goals. So there's no "sacrifice," only "rewards."


    Some exercise is better than none. If I'm really tired, then I'll walk 2 KM, about 20 minutes. My goals are higher, but some days I can't muster the energy. But doing some exercise makes me feel good.


    Work burns calories. Gardening, housework, etc. burns a lot of calories. But those activities don't offer cardio-workouts; they're not enough, but they can certainly reduce weight.


    Work up to higher levels slowly and comfortably. I once read the story of a 60-ish woman who was out of shape. She started walking one block a day, then slowly added distance. Eventually she tried jogging a block. Slowly, she ran a bit longer as it felt comfortable. After some time, she was running several miles and enjoying it.


    The form doesn't matter, the routine matters. It doesn't matter if it's yoga, tai chi, chi gung, walking, biking, swimming, etc., it's making it part of your routine so you miss it if you don't get to do it.


    Cross-training is good, especially as you age. Like many others, I see cross-training as common-sense. I don't run more than once or twice a week, but bike every day and walk some distance a few times a week. Ditto pushups and some other muscle-building stuff.



    Eat less, and eat more filling, low-calorie veggie snacks and dishes. Duh, right? But the human body is extremely efficient, and it's ridiculously arduous to burn 500 calories, and ridiculously easy to consume 500 calories.


    BMI calculator.


    Due to routine effort, my BMI is 21.8 and I can pass the Army Physical Fitness Test for active-duty men 20 years my junior. Is it easy to stay at this level? Heck no! I just don't have any other choice. If I looked like Arnie while preaching fitness and healthy eating, then I'd be undermining the entire message: we are what we do every day.


    (Please see my article Improving Americans' Health, With or Without Health Care Reform for more.)



    The cost of treating heart disease and stroke in the United States is expected to triple in the next 20 years, to $818 billion, a new report says.

    To curb this rise in costs, the panel said that "effective prevention strategies a re needed if we are to limit the growing burden of cardiovascular disease."


    American Heart Association CEO Nancy Brown said in a news release that "unhealthy behaviors and unhealthy environments have contributed to a tidal wave of risk factors among many Americans. Early intervention and evidence-based public policies are absolute musts to significantly reduce alarming rates of obesity, hypertension, tobacco use and cholesterol levels."


    Right now, 36.9 percent of Americans have some type of heart disease, including high blood pressure, coronary heart disease, heart failure, stroke and other conditions. By 2030, that number will rise to 40.5 percent of the population, or about 116 million people, according to the report.



    Fat, Sick And Nearly Dead: How One Man Took Control Of His Eating Habits


    "I hate exercise, but I like the results." (RIP Jack LaLanne)


    A Factor of Success As Adults: Self-Control


    Hungry? Your Stomach Really Does Have a Mind of Its Own Nestle Scientists Try To Train the Brain in the Gut To Feel Full With Less Food


    It's good to have goals, even if we can't quite meet them fully:



    "Without health there is no happiness. An attention to health, then, should take the place of every other object." (Thomas Jefferson, 1787, via Ken R.)



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    Tuesday, January 25, 2011

    The Kubler-Ross Model: Denial, Acceptance and Renewal in America

    Today we offer a guest essay by correspondent Eric A. which applies the Kubler-Ross model to America's current state of denial and wishful thinking.



    Reading Charles Hugh Smith’s “Cry in the Wilderness” for Individual Solutions ( As Public Policy Fixes Are Impossible, Focus on Individual Solutions) to our present crisis, I’m struck by the Kubler-Ross model. You know the one:


    1.Denial
    2.Anger
    3.Bargaining
    4.Depression
    5.Acceptance


    She doesn’t say how long each stage takes, but in a body the size of a nation, it must take a very long time indeed.


    Is there anybody out there who doesn’t know the financial system is broken? That home prices need to fall at least 30%--if not 50%--more? That Social Security is already in deficit? That they won’t be retiring in the manner in which they’ve desired?


    And the solutions, Oh, the solutions!


    1.More borrowing
    2.More lending
    3.More spending
    4.More lying, cheating, and stealing
    5.More government orders
    6.More expansion


    More of everything we’ve done that got us here. Is there anyone who doesn’t know you can’t solve a debt-and-spending problem with debt-and-spending?


    So why is it still going on?


    This is the wonder of Denial, of lying to ourselves, or in the American parlance, of Bullshit.Bullshit is different from lying in that it isn’t technically untrue, but it’s effectively untrue. Second requirement is that it’s invariably selling something, getting you to do something for the bullshitter—power or money. Third is that everyone knows that it’s bullshit. They know it’s a lie, but they’re willing to be complicit in the lie anyway, for their own reasons. Like all Cons, Bullshit can never work without the complicit help of the so-called “victim.”


    The only reason all these things can still go on is Denial.


    Why?


    I was at a Tea Party meeting (I know, I’ve already admitted it) where one of the participants asked, “Are you willing to give up Social Security?”


    “What?” I asked stupidly.


    “If you cut these taxes and reduce government, it’ll end Social Security. I want to know who here is willing to have their own check cut.”


    I stared, staggered at the obviousness of this simple statement.


    “Sir,” I stuttered, “It’s already gone. There IS no Social Security. You’d be lucky to get checks for even two more years.”


    My words did not compute so I let it slide, turning to other subjects.


    The unsustainable nature of the numbers surrounding Social Security and Medicaid have been obvious since the Baby Boom generation was done being born in 1966. The scam was fully apparent by at least the (non)re-structuring of withholdings with the Greenspan-Boskin Commission in 1983—and at least by 1984, as even the increased revenues were spent, with nothing saved.


    It would be self-evident that it wouldn’t matter in any case, since an entire nation cannot buy special pixie dust through its whole life without driving the price up—not Stocks, not Bonds, not even gold—and then sell it through their whole retirement without driving the price of that asset back down to zero again. That is, you can’t all put $10 into a hat, and have everyone pull $20 back out. That’s what Social Security, 401k privatization, the Stock Market, Investors, all propose to do.


    Since 1983, there have been commissions every few years, headlines in every major newspaper, including most recently G.W. Bush’s front-page quote,


    “There Is No Trust Fund.”


    I mean, exactly what kind of warning were you looking for? Do they have to come to your house and shake you by the ankles?


    Moving into the new decade, we find ourselves with a $1,600,000 Million deficit --per year--and the now-common knowledge that Social Security doesn’t exist—it’s just a budget item that is paid like any other: through borrowing. Borrowing on top of that $1.6 Trillion. Per Year.


    And you STILL think that you have something to lose? That there’s the slightest chance Social Security will be paid?


    …And I’m not following the arcana of the way governments reliably o ver-promise and default in history from Weimar to France, the close examples of Russia in 1997 and Argentina in 2001, that in 1776 Adam Smith had already declared “No government ever pays off their debts,” or any of the other second-level study that is easily found.


    Now that’s denial.


    Denial kills.


    So what’s my point with this?


    Would you rather, as with NJ Governor Christie, be told that there is no money in the known universe to pay what is owed in pensions, on bonds, in stocks, or in real goods, and thereby be able to adjust your life accordingly? Or would you rather, like GM Union workers and Enron employees, wake up one day and find that you have no pension whatsoever, but since you didn’t expect it, lose both house and pension at 70 because hadn’t saved on your own either?


    Here’s some help: one way you’ll have a retirement, however modest, and the other way you’ll be eating dog food under a bridge in East L.A. That’s what lying does. Lying to others or yourself. That’s why there is a thing called “morality,” and that’s why it’s wrong.


    But this is the bullshit we still tell ourselves, 5, 10, 30 years after the truth is obvious, and this the bullshit they’ll continue to sell you—with your own stolen money—until you stop buying it.


    Which leads me to Part Two.


    What comes after Denial?


    That’s right, Anger, and this country will rip itself apart with recriminations and blame. Blame the Left, Blame the Right; Blame the rich, Blame the poor; blame the insiders, blame the outsiders; blame the government, blame the anti-government; blame the old people who set it up, blame the young who won’t pay for it. Blame, acrimony, anger…and violence. In these still-rosy times perhaps you might have seen what I’m talking about.


    Who’s really to blame? Well, people who broke the law—especially that highest law, the Constitution—need to be tried and punished, and in keeping with that law, with real charges, real evidence and by a jury of their peers. There’s plenty of room for that. But what does that do? They only committed the crimes we allowed them to with our own sloth and indifference, with the same immorality we’ve let spring up in ourselves.


    We’re to blame. And being responsible, now we’re the ones who are about to take the inevitable consequences of our own immoral and irresponsible actions. There don’t need to be any trials for us: our punishment is already certain. But in the midst of that Anger and Blame, history says there will be wrenching in-fighting between groups, violence, and often even insurrections and war.


    What’s next on history’s Kubler-Ross model?


    Bargaining.


    This is what we could have done in the first place, if we hadn’t been so dedicated to what Basiat called, “The Fiction of the State”, that august body “through which everybody endeavors to live at the expense of everybody else.”


    How could each of us live at the expense of everybody else? Who are “we” going to get it from?


    Here’s a newsflash: Guess where wealth comes from?


    A: We make it.


    It doesn't come from Government. It doesn't come from “money,” or a magic fairy called “the economy.” All wealth comes from our own hard work, with each of us working to our abilities, cooperating, using the resources we have.


    So if we do that, how are we going to get richer or poorer than what we ourselves do? Get money right out of your head: money is nothing but recording system for reality, not reality itself. Creating money is useless. If you want a hammer, you need to make a hammer. Money does not make a hammer: a hammer factory does. Likewise, if you want a retirement, then you need to build a real condo, train a real nurse, clear a real field, hatch a real chicken for a real dinner, and don’t expect anybody else to do it if you won’t. We can’t do anything that we ourselves don’t do. We can’t have anything we ourselves don’t make. QED. Adding money makes no difference at all. Billions, Trillions, Quadrillions in bailouts--doesn’t matter.


    So what is Bargaining? It’s where people are so tired of the uselessness of fighting each other, ordering each other around, making each other pay for each other’s mistakes that we stop wasting our time on this useless activity. This is the first lesson of slavery, of tyranny, and why they fail: it's actually easier to DO the work than to force someone else to do it.


    We start saying to ourselves: “We have X in resources, and Y in needs. How do we get substance X to person Y in a fair and efficient way?” We used to use the old ways but the old ways didn’t work anymore. We say, “How much are you contributing to the overall good, the overall wealth, happiness, and security of everyone, and therefore what is fair to receive out of the overall wealth we have?”


    We used to use the monetary system to allocate this, but the monetary system was kidnapped, taken out back, and shot. We can make a new one—in the worst of Weimar’s inflation it took only a week—but we will still face the choice to either have a fair one, or an unfair one. The fair one people will work with and prosper. The unfair one people will reject and will collapse into poverty for as long as it takes. 70 years in the case of the USSR, 1,500 years in the case of Feudalism. It doesn't have to end.


    The only way the system works, the only way wealth is created is one way: through free, voluntary cooperation. Fighting only makes us poorer every minute we indulge in it.


    Guess what also happens with “Bargaining?” We do a real accounting of our real assets, NOT according to the ginned-up, mark-to-fantasy authorized by the now-irrelevant FASB. We are weighed, measured, and we come up wanting. We discover we are as poor as we actually are.


    Everybody knows this, of course. We’ve been lying to ourselves for decades. We no longer have manufacturing, no longer head R&D, are decades behind in energy, no longer have businesses, no longer place in education, in work, we no longer have a middle class, we don't even make our own shoes. We’re a gutted shell, financially, economically, morally, socially, intellectually, militarily. We’re a 3rd world nation, on par with Brazil. Why do we lie to ourselves about this? Why do we write pretty numbers in a pretty book that pretends we have real money we can cash in and spend? Is it so bad to have to do real work to create real things in the real world honest men can be proud of themselves for? We used to. For 100 years, from 1789 to 1914 we did. And now?


    ...The realization that we’re poor, we wasted it all, and have nothing before us but hard work leads to Kubler-Ross #4: Depression.


    We are already IN an economic Depression, and we have been since 2001. According to no less a source than Alan Greenspan, ALL the “prosperity” since 2001 was nothing more than debt; home-equity withdrawals that must be repaid. I mean, a 1% growth rate?



    All the prosperity was debt, which must be repaid with interest, or else defaulted on in bankruptcy--a bankruptcy that will ruin BOTH the borrower AND the lender. They are a single item on the Asset-Liability ledger book and must live and die as one. You cannot bail out the lender without the borrower, and vice-versa. There is no solution except either total slavery or near-total repudiation of debt.


    And when we go bankrupt, no one will lend to us anymore; we will have to live within our means. But wait—you’re saying we will a) not have a ruined economy struggling for decades to re-pay what cannot be paid? We’ll just be free with a new un-indebted economy overnight? And that b) that we won’t be able to borrow, thus fixing the national debt, budget deficit, and insider payoffs all in one fell stroke? And we get PAID to do this? Tell me again why we shouldn’t go bankrupt as fast as possible? What are lenders going to do, repossess and occupy the whole country?


    History reliably says if you want to survive, you should default as soon as possible.


    …So we admit we are poor as we already are, that we have nothing but our own hard work, and that this will continue for decades. But as the initial shock wears off, we find something interesting: It was always that way. Even in the past, we never got anything we didn’t work for, all that paper, all that supposed wealth, was only us lying to ourselves. For what do you lose when you stop lying to yourself? Only our illusions. We give up something we never had anyway, and with it, our chains. And as we work we get wealthier, happier, safer as our real savings: food, shelter, ability--not money—stabilize and we discover “This working for a living isn’t so bad. Why were we afraid of a little truth, a little change?”


    This leads to Kubler-Ross #5: Acceptance


    That’s self-explanatory. However, some of you long-wave people may recognize this process by another name: The Kondratieff Cycle:



    We started this trip with Winter, the down slope of the 70-year human cycle recently popularized by historians Strauss and Howe as “The 4th Turning”. After the decline into winter—usually punctuated with war, and twice in our history with Civil War—the seasons turn to Spring: hard work, caution, and thrift. Then Summer, the blossoming times of ease and exploration. …Which leads to Autumn, with complacency, abuse, corruption, self-deception, and overreach.


    And it all happens again, showing that “the one thing we learn from history is that nobody learns anything from history.” --Hegel


    Other than being an interesting walk through financial and social history, what’s the point here?


    Easy. The old world as you knew it is gone. Poof. Zip. Nada. Gone. All those promises that were made? It doesn’t matter what they were because there is not enough real substance on the entire planet to deliver on them. You were lied to, you lied to yourself, and you’re going to get nothing. Nothing but what you do for yourself right now.


    So what are you—what are WE—going to do about it? Yell and march and blame and shoot each other? Let the liars, con men, and bullshitters walk away free and wealthy men from the scam that bankrupted a nation, a world? Are we going to agitate, recriminate, and get ours first?


    This is the “Who are you” test. These are “the times that try men’s souls.” --Paine What’s in your soul? Who are you, America? Because, as a shadow that passeth away, so this old way passes despite every attempt to stop it. You have this one chance in 70 years to make this nation into the America you’d like it to be.


    Do we want a thin and false prosperity by war, theft, the wealth of lies? Or do we care more about justice, fair and moral behavior, and the responsibility of hard work?


    Next question: if you believe in hard work and Justice, are you going to make the OTHER guy work, the OTHER guy pay, or will the work start with you, and the morality, the truth start with you?


    Your choice America.


    For me, I know there’s nothing. I’ve paid into the entire system all my life and will get nothing out of it, ever. I never expected to. However, I want the privilege—in fact, the inalienable right—to keep my own property, my own hard work, and use it or waste it as I think best. That means I have to work for it, to do something truly useful in life, and not take it from somebody else who does work, not sit in a cube farm and shuffle meaningless chits for goods that don’t exist.


    Look around you, America. Everything needs to be done. The barns are falling down: the cities, the schools, the houses. The railways have been pulled up, the factories and mills are closed, the silos knocked over, the fields paved, the ports silted in and ruined. The children have run away; your poor and the old are abandoned. Who did this to you?


    You did it to yourself, and if you want a nation that functions, one that can feed and clothe you, one that has decency and prosperity and goodness, you’re going to have to go make one. That means grabbing the shovel that’s closest to you and starting there. That means if you see a need, some failure, some ugliness, you are the only one who’s going to change it into beauty and success. That means helping, sharing, teaching useful skills to everyone who’s willing to do the least work—for we must each do all we can. That means displacing the corrupt everywhere they’re found, everywhere they’re protecting each other, methodically, legally, one by one, starting in every Town, State, and National body, in corporations, public groups, government hall, and in your living room.


    And they won’t go easily, they won’t want audits, investigations, or prosecutions for fraud, theft, and public abuses, but that’s what happens when you let them in, and there is now no other way to keep your country.


    If not, well, maybe a just, moral, and functional country is not for you. Then maybe we’ll get the nation we deserve, the one we created for ourselves: one filled with surveillance, snitches, orders and rules as may suit a nation of slaves and prisoners.


    That may seem too big a task, but it’s only doing our jobs as adult men and women. To work for ourselves, to organize ourselves, to regulate ourselves, and not ask anyone else to do it for us. For who would that somebody be? Napoleon? Caesar? There IS no one else. That’s what “Republic” means. And as there’s only us, there’s no reason to look to anyone else, or give our attention, our power, our money to anybody else. Government can’t save us; government IS us. We can't all put $10 in a hat, pull out $20, and give government their cut to boot. Simply use your $10 on the task you find most worthy.


    This is how the world is going to change: it’s going to be under your control and become what YOU make it. Nobody anywhere else is going to save you. Right now the much-vaunted all-powerful government can barely hold off it’s own collapse: it's not going to save you.


    You’re on your own.


    Now that we’ve got that out of the way, here’s what we have planned at my house:


    The Maid d’Orleans* Mutual Aid Society will be meeting January 27th and every 4th Thursday thereafter at Elsewhere CafĂ©, in the near-ruins of once-majestic Victorian downtown of Albion, NY. We will be giving presentations on the things one needs to know to work in life: growing and preserving food, cooking cheaply and well, and the tools and techniques that make living well easy, possible, and most importantly, enjoyable. That is, how to do all the things you need do after you discover that no one’s coming to save you.


    As a poor starving man once said, “You must be the change you wish to see in the world.”


    Is anyone out there ready to work?


    Email maiddorleans ( at ) g mail ( dot ) com


    *The “Maid of Orleans” is of course Joan of Arc, a young farm girl who, merely by standing up, forever changed the course of human history.


    Thank you, Eric, for sharing your essay with us.


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