Pat Buchanan is Wrong: There Will Be No Inflation with Recovery

I love Pat Buchanan. He’s the main reason I watch The Mclaughlin Group, and the only reason I watch MSNBC. His knowledge of history and foreign policy is impeccable. He’s sincerely interested in politics, and he’s just plain fun to watch.

But like a lot of great political commentators inside the Beltway and out, I won’t go so far as to say he knows little to nothing about economics, he knows a great deal about economics, but his fundamental principles about the subject are just plain wrong. They are upside down, totally the opposite of how the economic world works. Take Foreign Trade for example. As a country YOU WANT a trade deficit. Why? Because your economy is so much larger than the other country’s they cannot possibly import from you as much as you import from them. Believe me, we will rue the day that we have even equal, much less more exports to China or any other country, as imports. Take a second and think about what that means.

But let’s concentrate on a subject that’s been on Pat’s mind a lot lately: Inflation, specifically inflation as the result of a booming economy. Look, on the face of it, it seems to make sense: The Fed has doubled their balance sheet since last fall to quote unquote “Bail out the financial sector” although such a ploy was a total red herring, and only a grab for power masked as such, but that debate is for another blog post. Also, with the prospect, God forbid, of a booming economy on the horizon, Inflation would seem to be a Tiger waiting in the wings to tear our figurative buying power’s heads off. But this is wrong headed thinking because precisely the opposite is the case:

Growth economies soak up excess liquidity like the Amazon rainforest soaks up Carbon Dioxide.  The truth about economics is that conventional wisdom is turned on its head, just as in 1906 Relativity turned the conventional wisdom about Reality (determinism, logic) on its head. Growing economies put downward pressure on inflation, not upward, by soaking up liquidity.


Look, I am no fan of the Fed.  It is an unconstitutional, Quasi Government/Private Corporation, that literally prints money that it sells through its distribution channels of partner shareholder banks, to a gullible, unquestioning public. And it does this while not only NOT fulfilling its Government Charter of providing a stable currency (which a de facto Gold Standard would do for free) but by actively (surreptiously or not is unknown) making the currency upon which we live swing wildly back and forth in value, causing the devastating inflations and deflations we have experienced for the first time in history since the 1971 closing of the Gold Window by President Nixon. I am a total libertarian, totally for Ron Paul 2012, and think it should be abolished, or have its reigns pulled in tightly with a Executive Order that it will not let the open market Gold price swing beyond a tight range.

But in the months ahead, if we are lucky enough to have a economic recovery, and I believe we will although the unprecedented “stimulus” (which is actually a pork bag full of free money to people who provide no value or production to our economy, but instead scam the people, by virtue of having power in legislative halls) will be a furious headwind not in our favor, inflation is the last thing one needs to worry about. Happy days will be here again, and the punch bowl can be brought out. To use a horse racing analogy, as I am in love with horse racing, the “Class” of technological innovation and productivity will over come the grueling pace duel with governmental regulation and confiscations that line pockets of political power brokers. In short Technology is the only thing propping our Economy up, but it is indeed a Secretariat, a Tiger Woods, and has the strength of Atlas.

I wish too that the government would not shrug Atlas, but Governments from time immemorial until today and forever more, simply have only one purpose: Internal and External Plunder. It’s time to get over that, unless we indeed can have a Libertarian Revolution.

But for now lets hope and expect a recovery. And with it there will be no signs of inflation on the horizon. The Gold Standard provides stable currency for free, and so does economic growth, with the only threat in such a situation being Inflation’s horrible ugly sister: Deflation, which is the real threat with the prospect of recovery, as the Fed is inclined (will) raise rates and starve the Growth engine’s main fuel supply: liquidity.

And then back on the Roller Coaster we shall all go. But if we can’t have a Libertarian Revolution and have a real democracy and a real free market we might as well adopt the Grateful Dead’s attitude (if not take the same contraband) and “enjoy the ride.”


Stephen Pickering. May, 2009


The Phenomenon of Combustion

By Robert Scoble

I imagine the idea of a dress
was stolen from a flower
in the year fire was discovered.
But no one is positively sure.

So desire is a controlled explosion
in which need is faster than light
and more precise than fire.

If that sets a dress on fire
or flowers explode, who cares?
It’s Spring and this is just
an idea for a love poem.

Although I’ve never seen her,
I make pieces of devotion
fill the darkness of her sleep.
She smiles to herself, I think.
It’s an eclipse. But who hasn’t been
blinded by someone lifting up her dress?

Such great danger and awe of beauty.
I’m unsure, the way children are
in the presence of a candle.
Intuitively they whisper, then-
well, I don’t wish to blow it out.

All our lives, wet logs in a fire,
desire is under control.
I’ve allowed myself to ask for beauty
and like beauty it’s unfair.
Good, we’re even.

The phenomenon of combustion means
no one is positively sure.

-Jack Myers from the volume “I’m Amazed That You’re Still Singing”


Businesses: Destroy Your “Us Versus Them” Mentality

I wrote this comment tonight on a very intriguing blog post by Robert Scoble entitled “Exploring the 2010 Web” All businesses and organizations should read this post and follow Scoble in general and Chris Brogan to learn how to apply Social Media effectively and to take your business into this next age of the “Telecosm” as George Gilder labeled it, in other words the Telecommunications Revolution. There is reason to be hopeful. Businesses embraced the “Microcosm” or the Micro Electronics Revolution beginning the 70’s, and this lead to the 80’s and 90’s being one of the greatest legal creations of wealth in the history of the World. The Wealth of the country as measured by the value of the Nation’s Capital stock, increased some 20 times. The productivity increases of the Telecom revolution will be of a magnitude 10 times larger. The Bandwidth revolution is indeed infinite because the number of colors of light are infinite, and each color can carry an infinite amount of data at wirespeed. The Exobyte floods are coming. Question is, will you and your business be riding it or fighting it?

This is interesting and comes to the heart of the matter. I think the crux of the matter psychologically is that businesses and organizations have to “tear down” “destroy” this “Us against Them” mentality. Not only Us against our Competitors but Us against our Customers. I owned and ran a furniture store for a number of years so I have some knowledge of this. When you have a store and a staff of employees there’s this tendency to see and treat the guy walking in off the street, a potential customer, as separate, somebody you don’t trust and who doesn’t trust you. That’s a normal initial, almost lizard part of the brain, reaction. But the trick is to break past that, and to really “schmooze” with people, not in a fake, acting kind of way, but being really interested in who they are, what they like, etc.
And one of the best features of these social media tools is a way to engage, to build that level of trust. I read a lot of books back then on sales and the best ones taught me this principle, and when I applied it, the sales just seem to come effortlessly, almost as an aftermath of a real connection being made.
And you see this everywhere. Business websites, especially large corporations, give off this impression of such intimidation, they almost act as a wall between the business and the potential customer, the exact opposite intention of the site.
Amazon is a great example of a great, maybe the best business site. It feels like it wants you there. Very inviting, very warm, very personalized. Heck they even want you to be an associate right on the spot.
The NYtimes on the other hand feels like this wall or veil. There’s so many new exciting things they could be doing with this new media, to make it fun, engaging, making you want to be there. But they remain huddled up, preaching down to us.
People have to want to be doing what they are doing. If they are doing it just for money, they’re not going to have happiness, and usually not money either because they aren’t going to be interesting enough, cutting edge enough. You get the sense that most businesses are just plodding along doing it this way because “this is the way we’ve always done it” kind of mentality.


The Future of the News? A Video Camera

Today, Robert Scoble just did his second live broadcast of an event he participated in, a distinguished panel discussing the future of traditional media. OK, I know you are already asleep. Only the truly geeky, geeky, longest of long tails, C-Spaners would watch such a thing. Right? Probably. But you must admit that it is an important topic. Almost a day doesn’t go by that we don’t hear about a newspaper in some city or other that is going broke. But here’s what I found most interesting about the event:

At an invent about the future of journalism, in our new media world, Scoble, laptop camera and mic pointed at the room, was THE ONLY PERSON JOURNALIZING! And he was journalizing LIVE!

Attention traditional media: HELLO?!?!?!?!?!?!?!?

The future of news is a Video Camera. And two hands carrying it that are halfway interested enough in the subject actually be there. It’s not that hard. Really. Except no one’s doing it.

If an event or piece of news that you are interested in is happening, which would be your first choice, to see it or to read about it? And if you had the choice of seeing it in real time or recorded which, again, would you choose? You may not trust Wikipedia, but I do think you trust your own eyes and ears.


The #1 Skill Needed to Become a Successful Blogger


That’s actually not a joke. That’s what Lockhart Steele, one of the most successful bloggers in the world just said on This Week in Startups #3.

This ties in perfectly (oh there’s that dreadful word again) with the last post about the importance of getting it out there and killing the desire for perfectionism. You know what I just realized? Perfectionism is the Eastern equivalent to the 1st Chakra, the lowest one, and the European Mythological equivalent of the “Dragon”, the one who is just hoarding everything of value, but not doing anything with it. Unwilling to let it go. It’s the Serpent Monster in the Indian Indra story, wrapping itself around the world and blocking out the waters of life.

Big Media has been a Serpent around the Public’s neck for the last 50 years. Of course driven by greed. But the thunderbolt of technology has destroyed it. Yeah! Let’s celebrate by pushing the “Publish” button.

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Perfectionism is the Enemy of Progress

OK, I can’t take credit for that line. Should I take it down? I actually learned it last week while watching Jason Calacanisfirst episode of his new show This Week in Startups, or #TWIST as I think he refers to it when you are Twittering.

As an example of this idea, he told the story of Microsoft Word. Word 1.0 basically sucked. But the key is they put it out there, and it was “good enough” to get some traction in the market. And then as each successive version came out, it got a little better and better, they fixed things, added things, and pretty soon, maybe it was a number of years, but by the time the PC revolution was reaching its crescendo, it was the best and dominant Word Processing program on the market and a cornerstone to their Amazingly successful Office Suite. I know its in vogue to hate Microsoft now a days, and maybe rightfully so, but no one can argue that its one of the greatest business success stories in American history.

The point is, if they hadn’t put it out there until it was “perfect” oh this is too ironic, you can’t make this stuff up, “WordPerfect” by Corel which then was the market leader might have continued on in first place.

I was thinking of all the amazing opportunities we have in this Telecommunications Revolution World we live in, specifically tonight of alternative bands that may have a small but devoted following sprawled out all over the world. I was thinking while I was watching Robert Scoble do a live video of a panel discussion he was on concerning Real Time Web Search. You see, Robert, or the Scobleizer, as he is known does a lot of these “off the cuff” videos live with just his Macbook and a account and channel. Many are just in his house. No pretense about a studio, etc, but so many times he is interviewing somebody really smart and interesting and I take away a lot of value from it. He even did a live video of a Facebook press conference a few weeks ago when they announced their intention to open up. That was a BIG DEAL, and as far as I know, no one else, no major or minor TV station was broadcasting it. Only Scoble and his little Macbook, this time pumped through Leo Laporte’s This Week in Technology (Twit) Network, which is another amazing story in and of itself.

I digress. I was thinking tonight that bands that fly under the radar, lets say they are playing a club in Ireland with just 50 people in the audience. Maybe they have dates all over Europe this summer like that, small venues, but enthusiastic loyal followers. But they have those same “long tail” loyal followers back in America and perhaps on every continent. Now with just a Macbook and Kyte or many other such services they can broadcast even their small club shows to a WORLD WIDE AUDIENCE. That is big. Think of how that would energize their fans, how it would engage their fans, who otherwise would be watching another band, or engaging in some other activity.

But they don’t do it. Why? Oh the quality isn’t perfect. But that’s missing the point. The “Long-Tail” audience will get an endorphin rush from the shear “aesthetic arrest” in what is happening, of how “cool” it is (the medium is the message) and forgive the low quality. The low quality might even intimate them more emotionally to the artist, and besides like Word 1.0, the quality is going to get here, soon, very, very soon. The Fiber backbone on the Continents and even under the seas connecting them has enough capacity for everyone on the planet to have a peer to peer HD connection, in real time, AT THE SAME TIME. The problem is only in the “Last Mile” which we can think the Telecom Act of 1996, at least in part for, if not all by privatizing the risks of the Telcos and socializing their profits. There you have it. Government regulation, not “de regulation” caused both the internet bust and the recent financial crisis. Yeah for big Government! Whatever, I digress again. Even Big Government(s) can’t stop the Exobyte floods that are coming, and the individual, whether he be an artist, business person, or practically any field (even politics!) will be the beneficiary of a much higher standard of living and a planet that has no limits of what it can do or where it can go. Star Trek just came out this week. Perfect, oops I said it, timing.

The “fire theft” motif of many Mythologies, most famously that of Perseus’ theft of the Sacred flame from Zeus, is a metaphor for Technology. We are stealing fire from the Gods. The fire is trapped inside those nanobits, or even deeper in 11 dimensional “strings” that literally transcend time and space. But if Perseus had waited until he was perfectly ready, no fire would have been stolen, and we wouldn’t even have a story to inspire, much less the technology all around us that was built, in part by the inspiration.

The “force” is the mysterious spontaneity of life itself, including the power that makes a flower blossom and the Earth to hurl around the Sun. The only way to harness that force is to let go of the desire to control it, which is the feeling of the Mind as being above nature: the heart of “perfectionism” itself.

*Update: I just began listen to TWIST #3, and the first caller who called in worked on a product for two years before he released, but by then it was too late, and Google had already come out with a similar product for free, yada, yada, yada. So another example. Jason just said, “You wanna’ get the product out there, you wanna’ iterate, you want to LEARN FROM YOUR AUDIENCE.” I love that last part. Something about it just seems to ring so true.