Friday, February 03, 2023

Seven Points on Investing in Treacherous Waters

What's truly valuable has no price and cannot be bought.

If all investments are being cast into Treacherous Waters, our investment strategy must adapt accordingly. Once we set aside denial and magical thinking as strategies and accept that we're in treacherous waters, a prudent starting point is to discern the most consequential contexts of all decisions about where and how we invest our time, energy and capital.

The most consequential global context is to first and foremost "invest in yourself": invest in forms of capital that cannot lose value (for example, integrity, skills and experience) and assets that are not dependent on fluctuations in valuations for their utility. This is the essence of Self-Reliance.

For example, tools retain their utility regardless of their current market value, and so does a house as shelter and yard to grow food. Whether the value drops to $1,000 or soars to $1 million, the property provides the same utility of shelter and sustenance.

In other words, the mindset of speculation--buy low and sell high to accumulate as much money as possible--is not the only context to consider.

A second global context is that speculative winners--assets that rise sharply in value--will increasingly be targets for "windfall" and/or wealth taxes, as well as capital controls, such as limits on selling. If you log a 500% gain, then paying a wealth tax is a small price to pay for such a handsome gain. But such enormous gains will very likely be far more scarce going forward as speculative bets become net drains on capital and speculators exit because their gambling chips are gone or they realize they better conserve what capital is still left.

Meanwhile, back on the Government Ranch, the crying need for more tax revenues will become increasingly dire. As speculative bubbles pop, capital gains will dry up and blow away, and this rich source of tax revenues will have to be replaced with higher taxes and junk fees on whatever income and assets are available for "revenue enhancement," ahem.

A "special assessment" tax on those worth $100 million or more will be approved first. The bar will then be lowered to $10 million, and then $1 million, which will of course include all assets, the family home, 401Ks, pension plans, small businesses, etc., and any assets held overseas. Civil penalties for stashing assets in dodgy offshore tax havens will of course increase concurrently. Purchases of cryptos and precious metals will be closely monitored / scrutinized.

Yes, the billionaires and corporations will remain untouchable due to their heavy buying of influence on the Political Action Auction (tm), but the plump medium-sized fish who can't swing millions in political contributions and legal fees will be inviting targets.

This generalized increase in taxes and junk fees on the wealthy and high consumption households will favor those who figure out how to live well on less income and fewer high-value assets.

A third global context is that simple bets on sectors may not provide the easy, stable returns that characterized the past 40 years. Those who rotated into "hot sectors" and cashed out when everyone else jumped in did very well.

This mindset is still ubiquitous. Many are calling for a commodity super-cycle that will deliver reliable gains to anyone investing in energy/commodities for years or decades to come. Others are flooding back into Big Tech or emerging markets.

Such simple trend-following sector bets will not work as reliably going forward, for several reasons. One is that artificial scarcities tend to be followed by gluts that crush valuations.

Another is the emergence of asymmetries within sectors. In other words, a rising tide will no longer not raise all boats.

Per a quote from Nassim Taleb: "Finance has three simple rules: maintain a clear mind, figure out asymmetries, never talk to idiots."

What are asymmetries? In shorthand, "winners take most." Put another way, the winners in each sector may garner the majority of the gains within the sector, as the winners have figured out a strategy to navigate treacherous waters.

Those pursuing old strategies will either lose or reap meagre gains.

The most successful investors / speculators will dig into companies, looking for asymmetries in financial assets, expertise, management, etc.--the traditional tools of stock pickers.

Buying index funds and ETFs to ride the tide higher will mean losing as the speculative tide ebbs.

A fourth context is that speculations in assets with no real-world utility such as NFTs have run their course and the gains will flow to companies producing real-world goods/services with essential utility.

This may be seen as part of the global trend of re-industrialization / reshoring / friendshoring.

A fifth global context is that one tool to discern productive asymmetries is to ponder what the wealthy value. The wealthy have the means to buy the most experienced advice and the incentive to protect capital, so what they pursue is worthy of consideration. This doesn't mean they will always be right, it simply means that just as keeping an eye on the herd is useful, so too is keeping an eye on the "some are more equal than others" group.

Real estate and housing is one example. The global housing bubble is finally popping, and house valuations have a long way to drop to reach historic trendlines.

That said, enclaves with all the attributes valued by the wealthy--safety, good schools and healthcare, local sources of energy and food, attractive natural settings and distance from decaying urban cores--will drop less, or could even retain their value due to the relative scarcity of places that meet these high standards.

A sixth global context is the value of maintaining a low profile that doesn't telegraph your wealth, what's known as the "gray person" strategy: blend in with neighbors, drive average-looking vehicles, avoid any ostentation. Blend into the background so no one will look at you twice.

A seventh global context is to invest in trusted personal networks, producing essentials others will value and your community of family, friends, neighbors, small enterprises and other local connections. These have value that cannot be assessed with a market price. As I've said many times, what's truly valuable has no price and cannot be bought.

Or as I've put it previously: "In a world besotted with the artifice of consumerism, what matters is not what can be commodified and bought but what can't be commodified and bought."

My Mobile Creative credo also speaks to this: trust your network, not the corporation or the state.

Trust and integrity are high on the list of what cannot be bought, and these are assets we should all leverage as the waters become increasingly treacherous.

This essay was first published as a weekly Musings Report sent exclusively to subscribers and patrons at the $5/month ($50/year) and higher level. Thank you, patrons and subscribers, for supporting my work and free website.






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A Hacker's Teleology: Sharing the Wealth of Our Shrinking Planet (Kindle $8.95, print $20, audiobook $17.46) Read the first section for free (PDF).

Will You Be Richer or Poorer?: Profit, Power, and AI in a Traumatized World
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The Adventures of the Consulting Philosopher: The Disappearance of Drake (Novel) $4.95 Kindle, $10.95 print); read the first chapters for free (PDF)

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Tuesday, January 31, 2023

What Goes Up Also Comes Down: The Heavy Hand of Bubble Symmetry

Should bubble symmetry play out in the S&P 500, we can anticipate a steep 45% drop to pre-bubble levels, followed by another leg down as the speculative frenzy is slowly extinguished.

Bubble symmetry is, well, interesting. The dot-com stock market bubble circa 1995-2003 offers a classic example of bubble symmetry, though there are many others as well. The key feature of bubble symmetry is the entire bubble retraces in roughly the same time frame as it took to soar to absurd heights.



Nobody could see bubble symmetry coming, of course. At the peak and for some time after, bubbles are viewed as the natural order of markets and so they should continue expanding forever.

Alas, the natural order of markets is mean reversion and the collapse of whatever is unsustainable. This includes speculative manias, credit bubbles, asset bubbles and projections of endless expansion of margins, profits, sales, consumption, tax revenues and everything else under the sun.

There's a well-worn psychological path in the collapse of bubbles. This path more or less tracks the Kubler-Ross phases of denial, anger, bargaining, depression and acceptance, though the momentum of speculative frenzy demands extended displays of hubris and over-confidence, i.e. the first wobble "must be the bottom."

There's also repeated spikes of false hope that "the bottom is in" and the bubble is starting to reflate.

This pattern repeats until the speculative fever finally breaks and all those betting on a resumption of the bubble mania finally give up.

This process often takes about the same length of time that it took for the bubble mania to become ubiquitous. If it took about 2.5 years for the bubble to expand, it takes about 2.5 years for the bubble to pop and the market to return to its pre-bubble level.

Once again we hear reasonable-sounding claims being used to support predictions of a never-ending rise in stock valuations.

What hasn't changed is humans are still running Wetware 1.0 which has default settings for extremes of emotion, particularly manic euphoria, running with the herd (a.k.a. FOMO, fear of missing out) and panic / fear.

Despite all the assurances to the contrary, all bubbles pop because they are based in human emotions. We attempt to rationalize them by invoking the real world, but the reality is speculative manias are manifestations of human emotions and the feedback of running in a herd of social animals.



With all this in mind, let's consider the current bubbles in stocks and housing. Should bubble symmetry play out in the S&P 500, we can anticipate a steep 45% drop to pre-bubble levels, followed by another leg down as the speculative frenzy is slowly extinguished.



Housing is notoriously "sticky" when it comes to price declines, as sellers show remarkable tenacity in the denial phase. The last few greater fools buying on the first modest decline spur the hopes of sellers that the flood of mania-driven buyers is about to resume, but manias don't last nor do they resume.

If bubble symmetry plays out, we can anticipate a relatively steep drop of about 30% to pre-mania levels, followed by a longer decline to pre-Bubble #1 and Bubble #2 levels, a roughly 60% drop from bubble heights.



Such declines are of course "impossible." There are always endless reasons why bubbles can't possibly pop and why 60% declines are impossible, even as history tells us that 60% declines are inevitable, and in the bigger picture, rather modest. It's the 90% declines that really hurt.


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A Hacker's Teleology: Sharing the Wealth of Our Shrinking Planet (Kindle $8.95, print $20, audiobook $17.46) Read the first section for free (PDF).

Will You Be Richer or Poorer?: Profit, Power, and AI in a Traumatized World
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Sunday, January 29, 2023

Here's How "Prosperity" Ends: Global Bubbles Are Popping

So here we are: the global credit-asset bubbles are popping, and the illusory "prosperity" generated by the bubbles is about to tumble off a cliff.

There are two kinds of prosperity, one fake, one real. Bogus "prosperity" depends on credit-asset bubbles inflating, magically creating "wealth" not from labor, production or improving productivity, but from the value of assets soaring as bubbles inflate.

This bubble-generated "wealth" then fuels a vast expansion of credit and consumption as assets soaring in value increases the collateral available to borrow against, and the occasional sale of soaring assets generate capital gains, stock options, etc. which then fund sharply higher consumption.

When the value of a modest home skyrockets from $200,000 to $1,000,000 in a few years, that $800,000 in gain was not the result of any improvement in utility. The house provides the same shelter it did when it was worth 20% of its current value. The $800,000 is gain is the result of the abundance of low-cost credit and the global search for a yield above zero.

Eventually, this vast expansion of "money" chasing yields and seeking places to park all the excess cash trickles into the real economy and the result is inflationary. Consider how soaring home prices affect rents.

When an investor bought the modest home for $200,000, the costs of ownership were low due to the costs being linked to the value: the property tax, insurance and mortgage were all based on the valuation. (The costs of maintenance were unrelated to valuation, of course, being based on the age and quality of construction.) Let's say the modest house rents for $1,500 per month.

The investor who buys the modest home for $1 million has much higher costs, even if they bought the property with cash and din't need to borrow money (i.e. obtain a mortgage). The property taxes and insurance are much higher, and the comparable market rent of similar houses reflects the expected yield on investing $1 million: if investors expect a 3% yield after all expenses, then the rents have to rise so the investor/owner nets $30,000 annually.

Due to the valuation increasing in a bubble, the rent is now $4,500 per month, even though the house hasn't materially gained any utility at all. The rent has to be high to justify the purchase price of $1 million.

This is why all credit-asset bubbles are self-liquidating: once the cost of credit drops to near-zero, there's no discipline left: any loan for any investment can be justified by the "guaranteed" increase in value / collateral. Since everything will rise in value, then it makes sense to leverage up as much debt as possible to gain control of as many assets as possible, as the means to maximize gain.

This leads to marginal borrowers over-extending, borrowing more than is prudent.

All this nearly free money sloshing around seeps into the real economy, jacking up prices (such as rents) without increasing the production of goods and services or improving productivity. Costs rise solely as a result of the bubble, pressuring wage earners and enterprises.

Central banks are eventually forced to raise interest rates and reduce credit expansion to put the brakes on the bubble's inevitable offspring, an inflationary spiral. Once credit is no longer expanding rapidly, the air starts leaking out of the asset bubbles. Marginal borrowers can no longer roll over their debt based on ever-higher collateral (as valuations rise, so does the collateral to support new loans) and default become inevitable once markets tighten.

For example, those willing and able to pay outrageous rents thin out, and commercial / residential properties are vacant, generating zero income.

But inflation generated by bubbles is "sticky." Landlords are reluctant to drop rents, as they've been trained by central bank bailouts and decades of easy money/credit to expect a prompt resumption of the bubble's expansion. This mentality permeates the entire economy.

Once valuations stop rising like clockwork, the bubble "prosperity' is revealed as illusory. All the "wealth" was illusory; it wasn't generated by improvements in productivity or the production of more goods and services; it was all based on soaring valuations driven by cheap, abundant credit and the bubble-mentality faith that bubbles never pop and so the "wealth" created by soaring stocks, bonds, collectibles and real estate would only continue expanding forever.

The inflation generated by bubbles remains as collateral crashes and credit expansion reverses into contraction. Suddenly, there's fewer greater fools willing to pay bubble prices for assets. The smart money sold long ago, but the not-so-dumb money finally awakens to the potential downside of bubbles popping: rather than reaping huge gains, assets might become illiquid (i.e. there are no buyers at any price) or valuations might fall faster than anyone believed possible in the heady bubblicious decades.

Bubbles liquidate the illusory "wealth" they generated when they pop, and then the bogus "prosperity" dissipates into the air from whence it came. The only source of real prosperity in improvements in productivity which generate more goods and services with fewer inputs of capital, labor, materials and energy.

So here we are: the global credit-asset bubbles are popping, and the illusory "prosperity" generated by the bubbles is about to tumble off a cliff. The $20,000 week at the posh resort was fun, as was the $80 lunch for two (two avocado toast and two beverages), but it was all fake, phony, a fraud: jacking the valuation of a bungalow five-fold doesn't actually improve productivity or create any new goods and services. It jacked up prices and property taxes, but it didn't actually create any real wealth.

It's a long way to the bottom, but it won't take as long as many seem to think.



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When You Can't Go On: Burnout, Reckoning and Renewal $18 print, $8.95 Kindle ebook; audiobook Read the first section for free (PDF)

Global Crisis, National Renewal: A (Revolutionary) Grand Strategy for the United States (Kindle $9.95, print $24, audiobook) Read Chapter One for free (PDF).

A Hacker's Teleology: Sharing the Wealth of Our Shrinking Planet (Kindle $8.95, print $20, audiobook $17.46) Read the first section for free (PDF).

Will You Be Richer or Poorer?: Profit, Power, and AI in a Traumatized World
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The Adventures of the Consulting Philosopher: The Disappearance of Drake (Novel) $4.95 Kindle, $10.95 print); read the first chapters for free (PDF)

Money and Work Unchained $6.95 Kindle, $15 print)
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Friday, January 27, 2023

Heretical Thoughts on Orthodoxies

Heresy evolves, orthodoxy cannot. Plan accordingly. Orthodoxies offer the comforting illusion of solidarity. But in what lies ahead, we're on our own.

In today's world, the key orthodoxies are secular rather than religious: they are economic, ideological, political. Religious orthodoxy is in the spiritual realm. It may have secular ramifications (for example, Galileo being forced to renounce his scientific advances) but it doesn't deal with forecasts of real-world systems.

Economic, ideological and geopolitical orthodoxies are different. They make forecasts about the real world, and they will be right or wrong.

The orthodoxies are roughly divided into two camps: the Establishment/Status Quo orthodoxies and the alternative orthodoxies.

Both are fiercely defended by True Believers, as the orthodoxy is the foundation of the True Believers' identity and worldview.

The two orthodoxies aren't necessarily diametrically opposed. Sometimes they overlap.

Much of what passes for "informed commentary" now is nothing more than True Believers cherry-picking whatever supports their orthodoxy. In this mindset, what's important is that everyone agrees with the orthodoxy. Public fealty to the orthodoxy is all that matters.

In this climate, projecting an outcome that doesn't fit an orthodoxy is heresy and must be suppressed.

I don't see any value in trying to persuade others to agree with me. The analysis goes where it goes, and it doesn't really matter if we like the conclusion or not.

What matters is one forecast will be accurate and the rest will be wrong. If 99.99% of the populace doesn't like the accurate forecast, that doesn't change the outcome.

If the analysis is sound, then the forecast is sound, and it won't change if it offends our sensibilities.

In other words, an emotionally detached analytic view is more likely to generate accurate forecasts than defending orthodoxies.

Put another way, accurate forecasts don't arise from popularity contests.

We might not like the results of a detached analysis, but liking it or hating it isn't the point. The accuracy is the point.

We might disagree with the forecast and hope it isn't accurate, but we understand our opinions and hopes won't change the outcome.

If we want to prepare an appropriate response to what's coming down the pike, we're better served by cultivating a detached view that favors our own independent analysis rather than orthodoxy. In other words, our self-interest is best served by becoming self-reliant.

Consider all the standard-issue orthodoxies, neatly packaged for easy marketing / consumption: Left and Right, Conservative and Progressive, Capitalist and Socialist, etc.

I find all the orthodoxies lacking. None makes sense of the dynamics I see as consequential, so we're forced to assemble our own analysis.

In other words, we're forced to secretly dabble in heresies.

For example, the Status Quo orthodoxy holds that the world is now multipolar and the influence and power of the U.S. / West is in an inevitable decline.

The West's dominance was a bad thing, so multipolarity is a good thing.

The alternative orthodoxy holds that the U.S. / West are doomed not just to decline but to give way to the dominance of China and its partners.

The West had its day, now it's China's turn.

This orthodoxy holds the US dollar will collapse in a heap, replaced by Bitcoin, a gold-backed yuan, or a basket of non-Western currencies.

Questioning these orthodoxies is akin to declaring God is dead in 1500. It doesn't go over very well with True Believers and their enforcers.

These orthodoxies are values/identity-based rather than analytic. They project what we think should happen because it fits our value system and what we identify with.

This is why orthodoxies are so vehemently defended: to question them is to question the moral rightness of the orthodoxy.

The problem with orthodoxy is two-fold: 1) orthodoxies suppress evolution and 2) we're blinded by our emotional attachments to orthodoxies.

We don't get attached to forecasts that don't impact our values or our financial security.

If someone forecasts inflation in Lower Slobovia will rise from 8% to 10%, we don't have any emotional stake in the forecast. If inflation there rises or falls, we don't care. We don't bristle and rush to defend either forecast.

Unless we've staked a speculative bet on inflation rising in Lower Slobovia. Then we care, deeply. We're completely emotionally engaged, and ready to tear the head off anyone arguing that our position is faulty and we're going to lose the bet.

Those with no emotional stake in the issue look on us with bemusement. What's the big deal? Whatever is going to happen is going to happen, so why get worked up about it?

Indeed.

As longtime readers know, I favor looking at everything as a system. There is really only one system dynamic, Natural Selection, i.e. evolutionary success or failure when evolutionary pressure is applied.

Human societies and economies are ecosystems, too, and so their success or failure is Natural Selection at work.

Two things matter in evolution: transparency and variability. Evolution is only possible if the genome / society / economy generates a steady stream of mutations / variations.

Variations / variability are the fuel of evolution: if there are no mutations / variations, then there's nothing new being fed to the system which can offer selective advantages.

Transparency is the mechanism needed to test / select variability. In the genome, mutations that offer some selective advantage are conserved by an automatic process.

In human organizations, transparency means there's a free-for-all churn of variability / dissent, experimentation and sharing of results. New ideas and data flow freely between all the nodes of the system.

Human organizations with weak variability and transparency fail to adapt because they lack the means to do so.

This is scale-invariant. Relationships lacking variability and transparency fail, enterprises lacking variability and transparency fail, nations lacking variability and transparency fail.

Authoritarian regimes, be they relationships, enterprises or nations, fail because there is no other possible outcome other than evolutionary failure. Any success will be illusory / temporary.

Finding this regime attractive or repugnant won't change the inevitability of its failure.

Transparency is not easy. People contest our treasured orthodoxies, upsetting us. We're forced to admit to being wrong far more often than we like. It hurts our pride and we lose face, but the upside is the immense success of the evolutionary churn.

This process is scale-invariant: every argument / disagreement reflects the underlying dynamics of the system, so every negotiation to resolve the conflict reflects these same dynamics.

This process is also evolutionary. The previous negotiation may leave one side dissatisfied, and so the negotiations evolve.

From the perspective of evolutionary churn, we shouldn't grudgingly allow variations, we should elicit them, welcome them not as threats but as essential churn, and then negotiate an outcome that is evolutionary, i.e. contingent and open to being changed as conditions change.

The couple that never argues and always puts on a smiley face isn't the healthy relationship. It's evolutionarily doomed to failure because the facade of unity and happiness is not actual unity or happiness.

The lack of variability and transparency have a cost that the participants and the system pay one way or another. It can be hidden for a while but not indefinitely.

The same can be said of nations. If dissent is suppressed, data is suppressed, communication is shackled by fear of exposure or censure and all decisions are made opaquely, that regime is doomed to evolutionary failure.

The nation where all the dirty laundry is out and everybody is arguing about it is evolutionarily robust. The nation where the dirty laundry is hidden deep in the basement to preserve the illusion of unity and success has been stripped of variability and transparency.

My analytic forecast (laid out in my book Global Crisis, National Renewal) is that evolutionary success demands relocalizing production of essentials and consuming less, and all the systemic changes required to enable and incentivize this evolution.

Evolutionary pressure doesn't go away when you hide the dirty laundry. It builds up. When variability / dissent are suppressed, the system has no evolutionary fuel. Starved, it collapses.

I don't think it matters what we call the world system or what configuration aligns with our values or what we think should happen. Evolutionary pressure is building, and those organizations which choose autocratic suppression of variability / dissent and transparency will fail.

Those that defend the churn of variability / dissent and transparency will evolve, come what may.

Orthodoxies by definition have been of stripped of variability and transparency. That's what makes an orthodoxy an orthodoxy.

For this reason, evolutionary success cannot arise within orthodoxies. Dissent, variability, sharing ideas, proposing solutions and negotiating transparently are all intrinsically heretical.

Orthodoxies have mastered the illusion of adapting to changing times. Orthodoxies introduce updated catch-phrases to mask their inability to evolve.

Heresy evolves, orthodoxy cannot. Plan accordingly. Orthodoxies offer the comforting illusion of solidarity. But in what lies ahead, we're on our own. Orthodoxy is a luxury we can ill-afford. What will prove consequential is Self-Reliance.

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This essay was first published as a weekly Musings Report sent exclusively to subscribers and patrons at the $5/month ($50/year) and higher level. Thank you, patrons and subscribers, for supporting my work and free website.



My new book is now available at a 10% discount ($8.95 ebook, $18 print): Self-Reliance in the 21st Century.

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Read excerpts of all three chapters

Podcast with Richard Bonugli: Self Reliance in the 21st Century (43 min)


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When You Can't Go On: Burnout, Reckoning and Renewal $18 print, $8.95 Kindle ebook; audiobook Read the first section for free (PDF)

Global Crisis, National Renewal: A (Revolutionary) Grand Strategy for the United States (Kindle $9.95, print $24, audiobook) Read Chapter One for free (PDF).

A Hacker's Teleology: Sharing the Wealth of Our Shrinking Planet (Kindle $8.95, print $20, audiobook $17.46) Read the first section for free (PDF).

Will You Be Richer or Poorer?: Profit, Power, and AI in a Traumatized World
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The Adventures of the Consulting Philosopher: The Disappearance of Drake (Novel) $4.95 Kindle, $10.95 print); read the first chapters for free (PDF)

Money and Work Unchained $6.95 Kindle, $15 print)
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Thursday, January 26, 2023

The Race to the Bottom Accelerates

When competence, transparency and accountability are all punished, the Race to the Bottom accelerates.

Race to the Bottom describes the process of competitive devaluation, where value is gutted to remain competitive with those who are grabbing market share by stripping out quality, value, durability, transparency, accountability and competence.

We see the global Race to the Bottom in everyday products: the quality of goods has plummeted as manufacturers compete to reduce costs to maintain high profit margins by stripping out the quality and durability of components. We see it in shrinkflation, where the cereal box contains less cereal while the price ratchets higher.

We see it when cereals that once contained no sugar are now sickly-sweet because the manufacturer is losing market share to less healthy sugar-bomb cereals.

We see it in healthcare where costs have been so ruthlessly stripped out to boost profits that it takes months to get an appointment and overworked caregivers no longer have the "luxury" of providing the care they were trained to provide. Routine procedures and hospital stays now carry pricetags equal to four years college tuition or a modest house.

The Race to the Bottom isn't limited to goods and services. Consider the bedrock of the social order, civility. Civility in discourse is now rarer than sightings of UFOs / UAPs.

In politics, scoring cheap points while ignoring the nation's social decay and unsustainable bubble economy is another example of the Race to the Bottom. Is getting to the bottom of the Taylor Swift ticketing "fiasco" really the most pressing issue that politicians need to address? It would seem so.

In macro-economics, the Race to the Bottom is often used to describe currency devaluation: nations seek to devalue their currency to boost exports, ignoring the downside of devaluation, i.e. their citizenry's wealth is also devalued as the purchasing power of their currency is reduced to aid a relatively small cohort of exporters.

The decay of transparency, accountability and competence that manifests across a vast spectrum of public and private life is a profoundly systemic Race to the Bottom. Local governments and corporations alike seek to hide their malfeasance, greed and incompetence and evade accountability by any means available.

It's as if hiding incompetence and insider profiteering is now the most valuable form of competence. Real-world competence has decayed to the point that nobody even knows what competence is, as they've never experienced it. The same can be said of transparency and accountability: nobody's actually experienced actual transparency and consequences falling to those in positions of responsibility.

The "solution" of the incompetent is always the same: throw more money at the problem. But doubling or tripling the budget for housing the homeless or improving public transit never results in doubling or tripling the efficacy or efficiency of the failing systems. Instead, the money is squandered on insider profiteering: studies no one ever looks at, PR displays of "caring," spectacles of some new showcased 'solution" that doesn't actually work and was never intended to be anything more than a PR stunt, and so on.

In this Race to the Bottom, power flows from saying "no", not "yes." The list of "stakeholders" is endless, and every one can stall or cancel a project. Nobody's in charge except to make sure nothing gets done of any consequence.

In this Race to the Bottom, it's a major victory if each unit of homeless housing only costs $300,000 each rather than $600,000 each and a grand total of 42 units will be built--eventually, unless of course a NIMBY group or other "stakeholder" nixes the project via endless judicial filings.

No matter how much money is thrown at the system, the bus service continues its downhill slide.

When competence, transparency and accountability are all punished, the Race to the Bottom accelerates. The worst are advanced, and the race to strip value, quality and quantity out of products and services becomes a free-for-all stripmining that favors the ruthlessly greedy.

"Markets" are nothing but platforms to be manipulated and gamed to benefit the few at the expense of the many. In this Race to the Bottom, regulators are either toothless or asleep at the wheel or bought off. Everything is for sale, and auctioned off to the highest bidder.

From low earth orbit, the Race to the Bottom is accelerating on all fronts because we've lost the ability to solve problems due to the power of entrenched insiders and powerful interests who profit so immensely from keeping the corrupt, unsustainable systems of power glued together for just a bit longer so they can maximize their private gains.

That the system they've hollowed out to maximize their private gain might take them down when it collapses doesn't seem to occur to them. Their "faith" in the power of wealth is absolute, and so they think they'll be safe in their fortified compounds, super-yachts, private aircraft, etc.

But all these forms of power are contingent on the vast system they are busy hollowing out.

So go right ahead and join the race to the bottom in every nook and cranny of public and private life. All your gains will vanish with the system that's been fatally undermined by the pell-mell race to the bottom.

The Ibogaine-fueled fantasy is that we can individually pillage the system by stripping it of value, but magically escape the consequence of everyone stripping the value out to maximize their gains, i.e. systemic collapse.

Nice, until the Ibogaine wears off. That's not how reality works. Actions have consequences, and those consequences have their own consequences.



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