Where is our new Frontier?

We will need some kind of new frontier in order for significant growth to take hold.

In the early stages of our nation, that growth came from westward continental expansion.

In the 1920's, growth came from unprecedented expanding consumer markets.

In 1950's-60's postwar America, growth came from rebuilding our nation and the world after the Depression and WWII destruction.

In the 1980's-90's, growth came from the computerization, digitization and online expansion of American life.

If we are in for a new expansion, what industry or circumstance will be the basis for it?

If the next expansion is going to truly benefit the little people-- the losers in that theoretical "income inequality" gap--then our expansion must begin with them.

It's time for the bootslingers that tread upon American streets, sidewalks and soils to pull themselves up by our bootstraps, because such a thing as prosperity cannot happen as a result of .gov programs.

The advanced, post-industrial condition of our economy indicates, I believe, that the next wave of innovation/expansion can, and must, come only from the economic micro-units of our heartland.

That is to say, from the garage tinkerers, the workshop wonders, the flea-market marvels, the home front hopefuls, the lemonade-stand lovers of our land who are unwilling to waste away in social media mediocrity and cabled corruption.

Now is the time for grassroots level renewal.

Now is the time for all men and women to come to the aid of their families, their neighborhoods, their communities, our country.

Donald Trump, bless his heart, may be an amazing guy, off the charts and all that, but he cannot pull prosperity out of a half-empty glass economic base.

The glass half-Full mindset will be based, in our future, on learning how to do more with less. The milking of this planet's resources can only go so far without seriously strategic enterprising innovation. That principle will be the lesson and legacy of the Obama years.

I hope we have learned, or will learn, that lesson of resourcefulness, and I hope that President Trump will facilitate our building upon that great base of American innovation and enterprise.

Don't you Americans be looking for no handouts. That well has run dry. It's time to drill a new one, but it may have to be in your own back yard.

In this way we may perhaps make America great again.

Glass half-Full

A New Bretton Woods?

We were in Rome about a year and a half ago, as part of a traveling celebration of our 35th wedding anniversary.

One evening as we were lollygagging through the busy rain-slicked streets and sidewalks, we passed in front of a very special building. It was the Rome headquarters of the European Union, or "EU".

I wanted to take a picture of the building's entry, because that is what tourists do--take pictures of important places. Seeking a broader view, I crossed the street. While positioning myself and the phone to snap a pic, the guard across the street noticed my activity. He started waving at me frantically, indicating that what I was doing was not permitted.

Excuse me. I was taking a picture of a public building.

In America, we take pictures of .gov buildings, because we have, you know, a government of the people, by the people and for the people, which means, among other things that the people can take pictures of their headquarterses (as Golem might say.)

Is this not the way you do it in Europe? No pictures of the RomeEU headquarters?

Nevertheless, here is my smuggled pic:

If you squint at my little jpeg here, you may discern the guard's upraised right alarm, a gesture of command intended to communicate a stop order on my touristic activity. It vaguely resembles another raised-arm signal that was in use in Europe 75 years ago, during the regime of Mussolini and that German guy who considered the Italian dictator to be his own puppet.

Or maybe I'm being too cynical about this incident. Maybe the guard was saluting me in some way, acknowledging my importance as an American tourist in the city of Rome.

Now, a year and a half later, this morning, seated comfortably in my own humble domicile, back in the USSA . . . I was pondering the idea of government--whether it is truly "of. . .by the people", or is it something else? Is it, as many citizens insist during these times of tumultuous societal change, actually an institution through which the "1%" (or as they said back in the old days, the "rich and powerful") project their oligarchical manipulations upon the rest of us?

I was thinking about this after reading online an article about how the worldwide financial system that has evolved.

http://seekingalpha.com/article/3993559-back-square-one-financial-system-needs-reset?ifp=0

In this Seeking Alpha blogpost, Valentin Schmid, as "Epoch Times" examines our international monetary system. His analysis appears to be generated from a well-informed position in the world of money, assets and power.

Mr. Schmid raises the question of whether the current (worldwide) debt load can ever be repaid, because there isn't enough "real money" to go around.

This got my attention, because I have been thinking for a while that there isn't enough "real money" to go around.

Haha, as if I knew about such things. I don't know much about money; if I did, I would have more of it.

Anyway, Mr. Schmid's question is answered by his guest interviewee, Paul Brodsky, in this way:

. . . "I would argue central banks lost the ability to control the credit cycle. Some relatively minor event could trigger a series of events that creates the need for a sit-down among global monetary policy makers who finally have to acknowledge publicly that their policies are no longer able to control the system, the global economy, which is based on ever increasing demand through ever increasing credit.

And what might occur is a natural drop in output. So you'll see GDP growth begin to fall. Real GDP growth across the world maybe even be going into contraction and that would spell doom for these balance sheets. And this is not something I'm predicting or trying to time at all, but the natural outcome of that would be a sit-down like a Bretton Woods where arrangements are reconsidered."

https://en.wikipedia.org/wiki/Bretton_Woods_Conference

So what is coming is, perhaps, this:

To compensate for a stalling of global productivity, the movers/shakers of the world may construct a new, top-down rearrangement of the world financial system. The purpose of this revision will be to fix the problem of not enough money to go around. Such an extensive reconstruction as this would be has not been done since the Bretton Woods agreement that was promulgated by delegates from 44 Allied nations in 1944.

In a 21st-century world inhabited by billions of inhabitants, our accessibility to natural resources has heretofore been determined by how many holes we could drill in the ground to extract natural resources; and how many acres of crops we could plant to produce food; how many factories we could build, and so on. . . building an economy to work toward spreading the bounty around.

In the future, however, we will be moving to a "knowledge" economy. Wealth creation will not be about how much you can dig in a day's time, nor how much you can plant, nor what you can cobble together in your back yard or over on Main Street.

Wealth generation in the future will be determined by what you know, so start learning now.

The first three essential things to know are these:

Reading, Writing, Arithmetic.

Well gollee, maybe it won't be such a brave new world after all.

However this thing plays out, if enough of us can master these three skills, .gov of the people, by the people and for the people will not perish from the earth, we hope.

Glass half-Full

Oh, Give Them

Oh give them some land to work with

and some water to make stuff grow.

Give them some tools to turn the earth over

and push all that dirt around,

productively.

Teach them to Plow it and disc it and

tend it and harvest it

and ship the Fruits of it out so folks can

Eat.

And give them some Water; we need

water.

Oh yeah let 'em eat drink and be merry.

Yeah, let 'em do all that

in this our promised land.

Let 'em slice it and dice it and

multiply, divide it.

Let 'em add this that and the other

and subtract what they think they don't need,

let 'em Seed and Feed.

Let the wise lead,

and hope they've chosen wisely.

Let the simple be fulfilled,

and not by their leaders be killed.

At the Wonder of it all, let us be thrilled.

Let us carve the earth and marvel at it all--

what we've done and what

we've made.

But hey, please don't let it go to our heads.

Instead, help us

Try to keep it in perspective with

some eyes on the big picture,

eyes on the prize

not obsessing with the size

of all this stuff.

Give us some Air to breath

and help us put on some wings and fly

Oh yeah

but help them limit our negative effects; let them

temper their intrusions, boost our inclusion.

We need to regulate it and yet we need

to deregulate it help us

figure all that part out that

delicate balance

sensitive valence.

We gotta prioritize it and sensibly control it.

Let 'em have a firm hand, a steady hand,

but, yeah, a gentle hand.

Let them take care in what they do with the earth

and the air.

Let them share;

and yes, be fair.

Yeah, let us be fair to one another,

and make sure there's enough to go around

for everybody. I'm not making this up.

Let them prosper and proceed

with their plans

but let them pray

today.

Yea, Let us pray.

Hey God. . .



Glass half-Full

BRICs in search of mortar

When Pat and I were raising our three kids we attended at least 12 graduations that I can remember.

The first round of matriculations came after each one completed kindergarten. Those first three ceremonies were joyous events for us young parents.

The next round was celebrated after each child finished 8th grade. With educational goals moving right along, we were again so very happy, as were the emerging adolescents.

The high school ceremonies were, of course, a biggie, in all three instances. Each young scholar's participation signified, within those symbolic processions, certifiable progress toward educational and life goals.

The crown jewels for our young adults and for us proud parents were the three college graduations, with one at Duke and two at University of North Carolina.

What a grand preparation for our offspring in their proficiencies to go forth in technified 21st-century world!

In every one of those symbolic processions through which our young ones paraded with their classmates up to a podium where they received diplomas, very graduate had a flat item mounted on their head. Hanging from that flat item was a tassel.

The mortar board.

Each young person sauntered forth into our world of work, information and progress, with a mortar board upon their head.

What is a mortar board?

In the oldest sense of this phrase, a mortar board is a flat, hand-held board; it is used to carry a small amount of mixed "mud" (mortar). The actual mortar board, in the real world of constructing walls and buildings, has, attached to it on its underside, a hand-sized vertical handle that enables the bricklayer to carry the board and its mortar payload easily. The worker can then move from one position to the next while carrying an amount of mortar suitable for efficient work in joining masonry blocks and/or bricks together as a constructed wall.

In the symbolic universe of education, however, a "mortar board" upon the graduate's head signifies that the person is equipped to build structures of a different kind.

With the competencies acquired through education, the graduate can, metaphorically, build progress, prosperity, businesses profitable or non-profit,, institutions, knowledge bases, etc.

I was thinking about the mortar board this morning. I was considering its meaning as a symbol, as I have just explained to you. . . but also as an actual implement of constructive work in the real world of building houses. My thirty+ years in construction provided many occasions in which I literally carried a mortar board for hours at a time, while constructing house foundations.

Then this morning, while reading about some new developments in the world of finance and investments, I thought about mortar boards of the metaphorical meaning, which is why I write to you now. There is something interesting going on in the world now, pertaining to mortar boards.

What I read that is so fascinating is an article that I came across in an online news source, Deutsche Welle, that I had never seen before today:

http://www.dw.com/en/brics-nations-launch-new-bank-currency-pool/a-18574402

I gather from reading it that the BRIC (Brazil, Russia, India, China) are gathering resources to fund an investment bank for purposes of financing infrastructure in their countries and also in the "emerging" countries.

If this banking alliance is successful, there will be in the future at least a certain amount--if not a huge amount--of divergence from those countries' heretofore dependence on the West's (USA, German, British, French) banking powerhouses, not to mention their central banks and international largesse like IMF and so forth.

I mean, there it is right there in the pic on the Deutsche Welle site: Putin of Russia, Modi of India, Xi of China, Rousseff of Brazil, gathered with many other national leaders in Ufa, Russia to lay foundations for the BRICs to get new "mortar" supplies for laying their necessary infrastructures in days to come.

Watch out, WallStreet!

Watch out, City!

Your days of hegemony in world finance and dollar dominance may be numbered.

These (formerly-called) Developing nations are now in the forefront of development and they need tools for constructing their infrastructure-deficient economies.

Wall Street's obsession with high-frequency trading and risk-averse bubbly speculation is becoming more and more irrelevant in a bold new world of expanding overseas financial needs-- Markets that are populated by young people--far more young people demographically than we have here in the good ole US of A.

Millions of young people with mortar boards in their hands and on their heads, applying for money mortar to construct sturdy infrastructural walls in which their own institutions will supply credit and new opportunities to initiate and develop new wealth.

Not old Western wealth recycled.

King Dollar, step aside! The handwriting for national developments across the world is on the wall. You are being challenged by the 4 R's: rubles, rupees, reáls, renminbi and probably eventually SDRs.

Better read what those hands are writing on their freshly-mortared walls!



Glass half-Full

Fundamental Economic Growth

Here's the working stiff's explanation of why our economic recovery is in slow mode, and why we'd be better off to get used to it. My theory is that the days of 4 and 5% annual growth in Western nations are gone, for, probably, at least a generation or more, if not forever.

The following rabbit trail of rumination began when I read, yesterday, the article in last week's The Economist magazine entitled Where did everyone go?

In that article, Mr(s)?. Free Exchange--whoever that person or entity is--starts the column with Milton Friedman's comparison of the business cycle to a musical string that is stretched and then is plucked to produce a sound:

"How far the string is plucked determines how much it springs back; similarly, the depth of a recession decides the strength of recovery."

This analogy resonated with me, because I spent years and years of my life exploring the musical possibilities of plucked strings on guitars, fiddles and pianos. But even more productive, economically speaking, than those vibrato years of musical exploration were my twenty-five or so years of what seemed like high-multiplier growth-generating employment: building houses for people (. . .although those first three years of building stuff, back in the early '80s, were spent constructing an S-shaped bridge around Grandfather Mountain, on the Blue Ridge parkway.)

Anyway, back to The Economist, which is a very thought-provoking analytically opinionated publication that my son introduced me to several years ago, about the same time that I bounced out of construction work and into more age-appropriate pursuits such as maintaining apartments and writing novels.

The aforementioned article, Where did everyone go, said this:

"The plucking (a string) model presumes that, after a recession, the economy returns to an underlying trend of growth. . ."

That presumption may have been sufficient for statistical analyses of past phases of expansive American economy. But not any more. The long tails of 20th-century bell curves now morph into new bell-jar graphs, representing 21st-century demographics and new value-added activities, if you catch my graphical drift. And here's why: the fundamentals are changing.

Back at the plucked-string analogy, a "fundamental" in music is the "underlying" vibration that defines all other modes of string activity. Let us say, for instance, that a stretched string on a piano, of a specific length/diameter will, when plucked, produce a vibration of 440 cycles per second; it is thereby named an "A" note, which is the fundamental sound heard when the string is plucked.

Economic activity in the developed world is now morphing from an "A" to a "C," which stands for "Could be trouble ahead."

As for The Economist's analogy based on uncle Miltie's plucked string. . . the fundamentals, or underlying trend, of economic growth are determined by:

"the supply of workers, capital, and technology."

Well, in my presumptive working-stiff naivete, I am going to identify here a fourth component of growth. It is an underlying element--the constancy of which the economists unwittingly assume-- because it has always "been there": natural resources.

Here is what is changing, big time, during our age: Every conceivable expense for gathering natural resources from the earth is going up, up, up.

I remind us of this simple oversight because of this: our basic level of natural resources extraction, and use of the earth itself, is the most fundamental change of all that is happening during the present age of human development. Retrieval of planetary resources will go down, down, down, as extraction difficulties and costs go up, up, up.

We are at planetary peak oil production. This is, of course, debatable, but I happen to believe that we are at planetary peak oil production. For more about that, go to http://www.peakprosperity.com/discussion/81169/peak-oil-science-and-evidence-please-help.

Here's another factor that will slow our growth: disappearing topsoil. We have depleted it, and it will take a long time to nurture our earth back into organic productivity.

Another problem is: minerals. We're having to go deeper and farther afield for every mineral we pull out of ole mother earth, especially the you-know-what one, the one we put in the car-tank every once a week or so. Tar-sands, rapacious open-pit mining and deepwater drilling-- all those intensifying recovery processes required to recover shale-oil or other minerals--they just add more labor and capital expenses. Getting oil out of the ground will never ever again get easier or cheaper.

Another thing is: lumber.

Wood. Here's the one resource about which I have some sweat-equity credentialed expertise.

During the 20+ years that I spent building houses, here is what I noticed, project after project, day after day, week after week, year after year:

The miners pull minerals out of the ground.

The manufacturers form the minerals into concrete block, insulation, plastic pipes, metal appliances, shingles, etc.

The masons lay up the concrete blocks into a foundation.

The carpenters nail wood onto the foundation to construct a house.

Where does all the wood and minerals for this process come from? The earth itself.

But the earth itself is depleted by past abusively extractive processes that generate, albeit along with useful products and projects, millions of pounds of industrial and consumer waste and climate-altering emissions. And processes for gathering these natural resources are injuriously invasive at a more-and-more precious cost, both economically and environmentally. There are multiple issues associated with these extractions that will inflict sore points of contention among political groups for many generations to come. Bottom line: they are another impediment to growth, and will result in slow development of diminishing resources, which translates to slower growth. Witness the XL pipeline controversy. This kind of thing between Greens and Chamber of Commerce types is not going away, but here to stay. Part of the territory.

Finally, the elephant in the room is wage inflation in developed nations, a major factor in the "workers" component of growth determinants listed by the Economist. The long and short of wage inflation is this: American and European workers have priced themselves out of the now-worldwide labor market. Hence. . . slower growth for us, if any growth at all is possible on a yearly basis, while developing nations do most everything cheaper, and using emergent technologies.

So, hey America! Good luck with all that. Better get used to it. Time for slow-growth innovations--work better and smarter. The days of 5 and 6% growth in developed nations are over--gone with the horse and buggy, the icebox, the VCR, cassette tapes, maybe even the desktop computer.

I know I'm all over the map with this essay, but so is the brave new world: all over the map.

And tha's what I'm talkin about.

Glass Chimera

Growth is good, or bad?

When I was a young man, I found this seed inside myself, and I wanted to plant it, but I didn't know how. I didn't know what to do, so I cast my seed on the ground; I flung it all around.

Then I met my woman, and she received my seed from me and made it into something beautiful--another human being.

And this was good.

Then we made another one, and another one after that.

And these were good.

Life is good, yes?

So we discovered, my woman and I, that working and loving together, we could make the world a livelier place, by bringing new life into it, children, who would grow, and bloom like beautiful, tender flowers, and then grow up to make the world a better place.

Growth is good, yes?

And considering all the stuff we bought along the way, we did our share to contribute to GDP. And considering all the stuff our kids bought and built along the way, they did their share to contribute to GDP.

GDP is good, n'est ce pas?

Now along comes my g-generation and makes an announcement to the world. My g-generation announces that, along with all that great prosperity-building GDP--all that good, coveted, economic growth that keeps everybody fat n happy, or lean and mean as some prefer, there is something else coming out of it all--something that is bad, not good, spewing forth from every exhaust pipe and every flue and chimney, from every power plant and from every rhetorical mouth and every bipolar human heart and indeed from every anus that requires wiping on the planet:

Carbon.

Carbon, which is at the core of every living thing. Carbon, which we send up through the chimney as waste, or spread on the ground to make our roads, or put in our steel to make it stronger. Carbon, that we use to write messages to each other, or to connect our marvelous social networks together. Carbon, which, in its purest, most dazzling form, we cut into a precious gem, and place it on the ring finger to signify fidelity and fertility and creativity and all that is good in this life.

Carbon is good, n'est ce pas?

It is as good as life itself.

Life is good, no?

Yes. Life is good. It is for us; how about you? Life is so good that I rejoiced at the revelation of its unique DNA identity-- its miraculous beauty, when my errant seed found its destined place of fertility and joy, deep within the love of my woman.

As for the GDP thing--and how good or bad that is--that may change as more men choose to cast their miracles into dark crevices of carboniferous death.

Glass half-Full