Thursday, March 30, 2017

The Economy: “The Great Interest Rate Illusion”

“The Great Interest Rate Illusion”, Introduction
by Brian Maher

"Our agents have caught wind that inflation is eyeing a comeback... because of Trump’s tax cuts, or his infrastructure spending? Maybe because the Fed’s planning to drop $100s from helicopters? No… none of the above. Our agents inform us it has nothing to do with the Fed. Trump would actually trigger the inflation - but not because of his tax cuts or spending plans. For another reason entirely. But what?

We shine a spotlight on it momentarily.  But first we turn it on the markets… No letup in “buying the dip” today. Lots of green. Dow up 69. S&P up seven. Nasdaq up 17. Even oil scratched out a gain. The only red we see today is gold - down 10 bucks and change. And so the great day of reckoning is postponed yet again...

But inflation could be returning to the stage. Not because of Trump’s tax cuts or his spending, but because of… bank deregulation. Yes, bank deregulation. The Fed’s balance sheet exploded from $800 billion pre-2008 to a handsome $4.4 trillion today. But official inflation - and we understand well any objections you may raise -can barely top 2%. That’s largely because the manna has been bottled behind the dams of the banking system, goosing asset prices.

It hasn’t broken through to Main Street. Why not? It’s not enough that the Fed prints money. That money must enter the economy through bank lending. But it hasn’t happened. The sluice gates are locked. One reason banks haven’t been lending is because of regulations enacted after the housing near-Armageddon of 2008. Dodd-Frank for one.

Financial advisory firm First Trust just released a report about it. From which: "Quantitative easing did not boost inflation in the U.S., nor did it boost economic growth. The reason: With one hand, the Fed was shoveling money into the economy, but with the other hand, it was regulating banks like never before. Higher capital requirements, Dodd-Frank and heavy-handed regulation kept banks from expanding loans at the same time they had more reserves and capital."

So the money’s been sloshing around the banking system instead of watering the thirsty seeds of economic growth. But the waters might soon come raining onto Main Street. Trump wants to take the regulatory jackboot off the necks of the banks. He vowed for example to do a “big number on Dodd-Frank” when he assumed office. And if Trump could get his repeals through Congress, the banks would find it easier to start lending again.

Why does that matter? Because that one act alone could send streams of dammed-up money pouring into the real economy - even if the Fed raises interest rates going forward.

First Trust: "If the Trump administration reduces regulation, the money supply will increase even if the Fed pays more to banks for holding reserves [monetary tightening]."

So if Trump lifts regulations and banks find it easier to lend, the money would finally wend its way onto Main Street. Then onto Maple and Oak and Elm streets, finally generating that long-anticipated inflation. There, a recipe for inflation - without tax cuts, without new spending. Just simple bank deregulation!

That would fuel even greater inflation expectations in turn. Followed by the Fed trying to choke them off. It’s already threatening at least two more rate hikes this year. So, maybe Trump actually produces the inflation markets have been expecting - even if he doesn’t get a dime’s worth of tax cuts or infrastructure spending. Then the battle of Trump vs. Yellen begins in earnest.

Below, David Stockman’s top analyst Lee Adler exposes the Fed’s “great interest rate illusion.” Did the Fed really raise rates March 15? And would higher rates even pop the stock bubble? Read on for the surprising answers.”
"The Great Interest Rate Illusion"
By Lee Adler

"Now that the Fed went ahead and done what all the Fedheads had said that they would do on March 15, the question is, what did the Fed actually do?

Did they tighten credit? No.
Did they reduce the size of the Fed's balance sheet? No.
Did they decrease the growth rate of the money supply? No.
Did they raise interest rates?

That last one may surprise you. I just said the Fed didn’t raise interest rates. What do I mean? Raising interest rates means raising banks’ costs of funds so that the banks will charge their customers higher rates. Banks make money when the amount of interest they can charge on the loans they make exceeds the amount of interest they have to pay depositors (savings, checking, etc.) - the cost of funds. The key takeaway is that, the lower the cost of funds, the more money banks make on the loans they make. And vice versa.

But the Fed hasn’t raised banks’ cost of funds at all. In fact, it’s lowered them. The Fed has merely increased the Interest on Excess Reserves (IOER) that it pays the banks for their $2.7 trillion in reserve deposits at the Fed. IOER is a de facto subsidy the Fed pays to the banks for the couple trillion in reserve deposits they hold at the Fed. Increasing it increases the cash subsidy to the banks.

Increasing the amount of interest the Fed pays on those reserves isn't a tightening. That's because raising IOER doesn't raise the banks' cost of funds. It lowers it. Raising IOER does not make it more difficult for the banks to make loans. It makes it easier. It increases their profits. By lowering their costs and increasing their profits, increasing IOER makes it easier for banks to make loans, not harder.

In other words, the Fed hasn't been raising bank costs at all since it began this rate cycle. Au contraire. The Fed has been increasing the interest it pays on excess reserves. Essentially, the Fed isn't tightening. It's easing. But the market doesn’t see it. It’s as if the Fed is the hypnotist and money market traders are the subjects of a great experiment in mass hypnosis.

The Fed had essentially told the market, "Keep your eyes on the spiral. You are getting sleepy, very sleepy. Now you believe that interest rates are rising." This was a done deal for the March FOMC meeting, with more to follow. Traders believe that the Fed has tightened, so they act as if the market is in fact tighter. But money is really much looser than the Fed would have us believe.

There has been no tightening because the Fed has not removed one dime of the massive excess cash it pumped into the banks over the course of QE. That pile of excess cash means that there are no restraints on loan growth other than borrowers desire to borrow. So, while the Fed did not tighten money one iota, rates moved up because of the power of suggestion. With trillions in excess cash lying around the Fed can only suggest.

What will the Fed do when the market wakes up? And how would the markets react to the reality that the Fed really doesn't control interest rates at all? Illusions don't last forever.

But let’s just assume for the moment that the Fed actually did raise rates, does that mean the bubble will stop expanding? Actually, no. In the early and mid stages of a credit tightening cycle - which is what we’re in right now - such increases do nothing to reduce lending or curb speculative fervor. In fact, in an inflationary environment, raising rates normally even leads to increased lending, increased speculation, and increased inflation! All things that the Fed purportedly wants to curb.

Speculative lending won't be curtailed, and unfortunately, the stock market blowoff may prove more persistent. Eventually that will only lead to a bigger more intractable collapse. If you don't believe me, I can tell you that I'm old enough to have lived through just such a period as a young adult starting my career on Wall Street in the 1970s. More recently it happened in the Fed's last tightening cycle from 2004 to 2006.

Greenspan raised the Fed Funds target from 1% to 5%. The consumer price index (CPI) rose from 1.6% to a peak of 4.6% in September 2005, and stayed at 3.5% or higher until the end of the rate increase cycle. The increase in lending rates was supposed to slow credit growth. What happened? It grew faster.  Loan growth was already red hot at near 7% at the beginning of the rate increases. By the end of 2005, loan growth was skyrocketing at an annual rate of more than 13%. We were in the midst of the greatest credit bubble in history. Finally, the S&P 500 was around 1125 at the beginning of the rate increase cycle in 2004. It rose to over 1300 in the middle of 2006, about a 16% increase. So much for interest rate increases tightening credit, slowing speculation, or reducing inflation. In fact just the opposite occurred over that 2 year period. 

We all remember the late Great Housing Bubble (not to be confused with the current great housing bubble - lower case). According to the Federal Housing Finance Agency (FHFA), house prices inflated by an average 17% nationally during those 2 years. And FHFA's methodology suppresses the rate of increase. The hot bubble markets went up 25-30% per year!

So we don't need to go back to the 1970s to know that raising interest rates doesn't slow inflation and doesn't slow lending. We learned that very well again in the 2004-2006 experience. And we also learned especially that raising interest rates does not slow speculative bubbles.

In fact, rates never became punitive during the Great Housing Bubble, like they did under Paul Volcker in the early 1980s. In 2006, home prices were still rising at a rate well above the Fed Funds rate. The Bubble died of too much bad credit. The financial system crashed because it had fraudulently lent too much money under false pretenses. Once it became clear that too much bad debt had been created, the financial system collapsed. It wasn't because of high interest rates.

So the idea that the Fed raising rates will reign in speculation, curtail lending and keep inflation in check is patently absurd. Raising rates without actually tightening credit, could do the exact opposite just as it has in the past. No two cycles are exactly alike, but if past is prologue, this rate cycle will cause an increase in the amount of speculative borrowing.

It's too early to tell how this will play out and how the financial markets will respond. I suspect that this will end badly because it's based on a fraud perpetrated by the Fed. So far, money market traders have bought in, but the pressures of reality will soon intrude on the fantasy. Then the mass illusion currently in effect will end with a bang.”


Musical Interlude: Liquid Mind, “Velvet Morning” ("Void of the Stellar Winds")

Liquid Mind, “Velvet Morning” ("Void of the Stellar Winds")

"A Look to the Heavens"

“Large, dusty, spiral galaxy NGC 4945 is seen edge-on near the center of this rich telescopic image. The field of view spans nearly 2 degrees, or about 4 times the width of the Full Moon, toward the expansive southern constellation Centaurus. 
 Click image for larger size.
About 13 million light-years distant, NGC 4945 is almost the size of our own Milky Way Galaxy. But X-ray and infrared observations reveal even more high energy emission and star formation in the core of NGC 4945. The other prominent galaxy in the field, NGC 4976, is an elliptical galaxy. Left of center, NGC 4976 is much farther away, at a distance of about 35 million light-years, and not physically associated with NGC 4945.”

Chet Raymo, "Free As A Bird"

"Free As A Bird"
by Chet Raymo

"All afternoon I have been watching a pair of hummingbirds play about our porch. They live somewhere nearby, though I haven't found their nest. They are attracted to our hummingbird feeder, which we keep full of sugar water. What perfect little machines they are! No other bird can perform their tricks of flight - flying backwards, hovering in place. Zip. Zip. From perch to perch in a blur of iridescence. If you want a symbol of freedom, the hummingbird is it. Exuberant. Unpredictable. A streak of pure fun. It is the speed, of course, that gives the impression of perfect spontaneity. The bird can perform a dozen intricate maneuvers more quickly than I can turn my head.

Is the hummingbird's apparent freedom illusory, a biochemically determined response to stimuli from the environment? Or is the hummingbird's flight what it seems to be, willful and unpredictable? If I can answer that question, I will be learning as much about myself as about the hummingbird. So I watch. And I consider what I know of biochemistry. The hummingbird is awash in signals from its environment - visual, olfactory, auditory and tactile cues that it processes and responds to with lightning speed.

How does it do it? Proteins, mostly. Every cell of the hummingbird's body is a buzzing conversation of proteins, each protein a chain of hundreds of amino acids folded into a complex shape like a piece of a three-dimensional jigsaw puzzle. Shapes as various as the words of a human vocabulary. An odor molecule from a blossom, for example, binds to a protein receptor on a cell membrane of the hummingbird's olfactory organ - like a jigsaw-puzzle piece with its neighbor. This causes the receptor molecule to change that part of its shape that extends inside the cell. Another protein now binds with the new configuration of the receptor, and changes its own shape. And so on, in a sequence of shapeshifting and binding - called a signal-transduction cascade - until the hummingbird's brain "experiences" the odor.

Now appropriate signals must be sent from the brain to the body - ion flows established along neural axons, synapses activated. Wing muscles must respond to direct the hummingbird to the source of nourishment. Tens of thousands of proteins in a myriad of cells talk to each other, each protein genetically prefigured by the hummingbird's DNA to carry on its conversation in a particular part of the body. All of this happens continuously, and so quickly that to my eye the bird's movements are a blur.

There is much left to learn, but this much is clear: There is no ghost in the machine, no hummingbird pilot making moment by moment decisions out of the whiffy stuff of spirit. Every detail of the hummingbird's apparently willful flight is biochemistry. Between the hummingbird and myself there is a difference of complexity, but not of kind. If humans are the lords of terrestrial creation, it is because of the huge tangle of nerves that sits atop our spines.

So what does this mean about human freedom? If we are biochemical machines in interaction with our environments, in what sense can we be said to be free? What happens to "free will"? Perhaps the most satisfying place to look for free will is in what is sometimes called chaos theory. In sufficiently complex systems with many feedback loops - the global economy, the weather, the human nervous system - small perturbations can lead to unpredictable large-scale consequences, though every part of the system is individually deterministic. This has sometimes been called - somewhat facetiously - the butterfly effect: a butterfly flaps its wings in China and triggers a cascade of events that results in a snowstorm in Chicago. Chaos theory has taught us that determinism does not imply predictability. Of course, this is not what philosophers traditionally meant by free will, but it is indistinguishable from what philosophers traditionally meant by free will. If it walks like a duck, and quacks like a duck, it's a duck.

I watch the hummingbirds at the feeder. Their hearts beat ten times faster than a human's. They have the highest metabolic rate of any animal, a dozen times higher than a pigeon, a hundred times higher than an elephant. Hummingbirds live at the edge of what is biologically possible, and it's that, the fierce intenseness of their aliveness, that makes them appear so exuberantly free. But there are no metaphysical pilots in these little flying machines. The machines are the pilots. You give me carbon, oxygen, hydrogen, nitrogen and a few billion years of evolution, and I'll give you a bird that burns like a luminous flame. The hummingbird's freedom was built into the universe from the first moment of creation."


“While there is life there is hope- 
and while there is hope there is life.”
- E. E. Holmes

History: "The Battle of Watling Street"

 "The Battle of Watling Street"
by Wikipedia

"In AD 43, Rome invaded south-eastern Britain. The conquest was gradual. While some kingdoms were defeated militarily and occupied, others remained nominally independent as allies of the Roman empire. One such people was the Iceni in what is now Norfolk. Their king, Prasutagus, secured his independence by leaving his lands jointly to his daughters and to the Roman emperor, Nero, in his will. But when he died, in 61 or shortly before, his will was ignored. The Romans seized his lands and violently humiliated his family: his widow, Boudica, was flogged and their daughters raped. Roman financiers called in their loans, which must have placed an increased burden of taxation on the Iceni.

When the Roman Governor of Britain, Gaius Suetonius Paulinus, was campaigning on the island of Mona (Anglesey, north Wales), the Iceni, led by Boudica, revolted. The Iceni allied with their neighbors the Trinovantes, whose former capital, Camulodunum (Colchester), was now a colony for Roman veterans. To add insult to injury, the Romans had erected a temple to the former emperor Claudius in the city, built at local expense. The rebels descended on Camulodunum and destroyed it, killing all those who could not escape.

Boudica and her army headed for Londinium (London). So did Suetonius and a small portion of his army, but, arriving ahead of the rebels, concluded he did not have the numbers to defend the city and ordered it evacuated before it was attacked. It, too, was burnt to the ground and the Roman historian Tacitus claims every inhabitant who could not get away was killed.

While Boudica's army continued their assault in Verulamium (St. Albans), Suetonius regrouped his forces. According to Tacitus, he amassed a force including his own Legio XIV Gemina, parts of the XX Valeria Victrix, and any available auxiliaries, a total of 10,000 men. A third legion, II Augusta, near Exeter, failed to join him; a fourth, IX Hispana, had been routed trying to relieve Camulodunum.

Hugely outnumbered, Suetonius would have chosen his battleground carefully. He selected a narrow gorge with a forest behind him, opening out into a wide plain. The gorge protected the Roman flanks from attack, whilst the forest would impede approach from the rear. This would have prevented Boudica from bringing considerable forces to bear on the Roman position, and the open plain in front made ambushes impossible. Suetonius placed his legionaries in close order, with lightly-armed auxiliaries on the flanks and cavalry on the wings.

As their armies deployed, the commanders would have sought to motivate their soldiers. Tacitus, who wrote of the battle more than fifty years later, claims to relate Boudica's speech to her followers: "Nothing is safe from Roman pride and arrogance. They will deface the sacred and will deflower our virgins. Win the battle or perish, that is what I, a woman, will do."

Although the Britons gathered in considerable force, estimated as high as 150,000, they are said to have been poorly equipped, their military strength having been impaired by an Iceni disarmament that had preceded the rebellion. They placed their wagon train in a crescent at the large end of the field, from which point their families could watch what they may have expected to be an overwhelming victory. Two Germanic leaders, Boiorix of the Cimbri and Ariovistus of the Suebi, are reported to have done the same thing in their battles against Gaius Marius and Julius Caesar respectively.

Tacitus also wrote of Suetonius addressing his legionaries: "Ignore the racket made by these savages. There are more women than men in their ranks. They are not soldiers - they're not even properly equipped. We've beaten them before and when they see our weapons and feel our spirit, they'll crack. Stick together. Throw the javelins, then push forward: knock them down with your shields and finish them off with your swords. Forget about booty. Just win and you'll have the lot." Although Tacitus, like many historians of his day, was given to invent stirring speeches for such occasions, Suetonius's speech here is unusually blunt and practical. Tacitus's father-in-law, the future governor Gnaeus Julius Agricola, was on Suetonius's staff at the time and may have reported it fairly accurately.

Boudica led her army forward across the plain and into the narrowing field in a massive frontal attack. As they advanced, they were channelled into a tightly packed mass. At approximately forty yards, their advance was staggered by a volley of Roman pila, the Roman javelin. The pilum was designed to bend when it hit a shield, making it impossible to pull out; the enemy would either be encumbered with a heavy iron spear weighing down his shield, or have to discard it and fight unprotected; a second volley followed, as each Roman legionary carried two pila. This tactic destroyed any organized advance by the Britons.

With the Britons in disarray, Suetonius ordered his legionaries and auxiliaries to push forward in the standard Roman wedge formation, creating a front line that took the appearance of the teeth of a handsaw. With their superior discipline, the Romans were able to continue fighting as fiercely as ever. With a clear advantage in armor, weapons, and discipline, this gave them a decisive edge in the close quarters fighting against the tightly packed Britons. The cavalry, lances extended, then entered the fray. As their losses mounted, the Britons tried to retreat, but their flight was blocked by the ring of wagons and they were massacred. The cavalry also attacked the Britons from the flanks as the Roman infantry advanced. The Romans killed not only the warriors but also the women, children, and even pack animals. Tacitus relates a rumor that 80,000 Britons fell for the loss of only 400 Romans. However the figures quoted for the campaign in the ancient sources are regarded by modern historians as extravagant.

Boudica is said by Tacitus to have poisoned herself; Cassius Dio says Boudica fell ill and died and was given a lavish burial. Poenius Postumus, prefect of the 2nd legion, which had failed to join the battle, having robbed his men of a share of the glory, committed suicide by falling on his sword.

The site of the battle is not given by either historian, although Tacitus gives a brief description. A wide variety of sites, all consistent with an army attacking from the area of London toward the Roman forces concentrating from the direction of Cornwall and Wales, has been suggested. One legend places it at Battle Bridge Road in King's Cross, London, although from reading Tacitus it is unlikely Suetonius returned to the city.

Aftermath: It is said that the emperor Nero was so shaken by these events that he considered withdrawing from Britain altogether, but with the revolt brought to a decisive end, the occupation of Britain continued. Fearing Suetonius' punitive policies would provoke further rebellion, Nero replaced the governor with the more conciliatory Publius Petronius Turpilianus. The defeat of Boudicca ensured Roman rule in southern Britain, however northern Britain remained volatile. In AD 69 a Brigantes noble Venutius would lead another less well documented revolt, initially as a tribal rivalry but soon becoming anti-Roman in nature."
Related videos:
"Queen Boudica Final Battle" 1-3

The Daily "Near You?"

Kazan, Tatarstan, Russian Federation. Thanks for stopping by!

"The Art of Letting Others Be Right"

"The Art of Letting Others Be Right" 
by David Cain

"My brain, like all brains, houses an unbelievable quantity of remembered information, and a huge amount of that information is stuff I’ve watched on television. I always hated Star Trek, and frequently said so, but whenever I catch a clip of "The Next Generation", somehow I’ve seen that episode before. I was also never exactly a fan of The Oprah Winfrey Show, but I’ve surely seen several hundred hours of it. For years after it went off the air, I kept remembering a particular insight Oprah shared once. I forget the context, but Oprah was amazed to realize that she didn’t have to answer the phone just because it was ringing.

It was a significant insight to me too, not because answering the phone is a particularly difficult task, but because it meant there was an invisible freedom there, which I somehow didn’t realize I had. Even if I still answered every call, it felt like a choice. Before that, it had been a kind of a master-slave type relationship, in which some remote person could push some buttons and force my body up onto its feet (perhaps tearing me away from a Star Trek rerun).

I am slowly grasping another overlooked freedom, which is the freedom to let people be right (or at least feel right) even though I think they’re wrong. When someone tries to tell the world that Crash is a brilliant film, or that evolution is “just a theory”, I forget that I am free to let them continue to think so.

I gather I have a long history of arguing my views, even when I’m not sure why I’m doing it. One time I was respectfully disagreeing with a coworker about something, and after a particularly good point I made, his tone went from sporting to angry and he said, “Damn, you are one argumentative person!” I told him he was wrong, but later wondered for a few seconds if I was indeed argumentative. No, he was the argumentative one. Otherwise he would have realized I was right.

And this was before the internet was omnipresent in our lives, before it started joining us in the bathroom, back when “going online” was still just an activity you did for part of the day, rather than an additional mode of global perception we can activate at any moment. The typical person experienced far fewer moments in which it felt appropriate to argue a point beyond what politeness allows. 

Today, it’s alarmingly easy to find yourself antler-locked with some remote, faceless person who’s trying to tell you that universal healthcare is a communist plot, while you’re waiting for your potato to finish microwaving. This facelessness turns up our impulse to argue even more. You may have noticed it’s a lot less pleasant to argue with someone when you can see their eyes.

I suppose many of you have no idea what I’m talking about. You see a statement you don’t agree with, or you know to be factually wrong, and it creates no urge in you to correct, illuminate or scold, even in your head. You could hear someone praising Nancy Grace as a selfless defender of the vulnerable, or arguing that Godfather III was as good as the others, and yet feel no desire to try to get them to stop thinking that. You are wise enough to know that “fighting the good fight” in internet comment threads is almost always pure indulgence, and just gives ignorance a reason to sink anchors and get louder.

But many of us aren’t so wise. Those argumentative souls among us that do engage, (and there are zillions of us, based on the comment totals on Facebook and YouTube alone) often believe we are somehow actually changing minds, actually eradicating ignorance and thoughtlessness. We aren’t indulging in a destructive or at least useless pastime, we’re saving the world from wrongness, one faceless Reddit user at a time. It’s not just okay to engage in these little conflicts, it’s a moral imperative. We can’t just allow ignorance to go on unopposed. The internet (well the whole world really, but it’s easiest on the internet) must be patrolled for bad beliefs.

And of course, it seldom occurs to us that we’re wrong. Maybe all my sources are incorrect, and we do swallow eight spiders a year in our sleep. But in the heat of enthusiastic wrong-righting, it never occurs to you that you’re the problem, or at least part of it. Being wrong feels exactly like being right, which is the sole feeling experienced by all parties, in any argument, about anything.

For those of us inclined to argue every point, it’s easy to forget that we have the freedom to simply carry on with our lives and let “wrong” viewpoints stand. It’s amazing how often it can seem like an exchange needs your input, the way a screaming kettle needs to be taken off the element.

But it’s not the same. A different viewpoint, no matter how egregious it seems, is no emergency. Civilization survived for over 10,000 years before you and I got here with our snarky corrections and condescending rebuttals, and we didn’t exactly make a huge difference when we did arrive. It turns out we don’t have to try to stop people from thinking what we don’t want them to think, and that our energy is probably better spent elsewhere. In other words, it is possible, theoretically, to retire from Belief Patrol.

I know beliefs have consequences in the real world. Harmful actions come from bad beliefs. I’m not claiming that we should never oppose anyone, never call anyone out, never engage with people who disagree with us. I just don’t think that casually sparring with blowhards on social media, or even in real life, actually affects anyone’s beliefs in a helpful way.

I think Richard Carlson’s advice is probably an ideal motto for this: Let others be “right” most of the time. Asserting and defending our views takes an enormous amount of mental energy and accomplishes little. Sometimes it’s important (and actually useful) to take a stand in a conversation, but usually it’s just a kind of peace-destroying indulgence.

By “retiring from Belief Patrol”, I’m talking mostly about retiring from having non-face-to-face arguments in which there’s no mutual respect. The moment the motivation slips from goodwill to ill-will or annoyance, I’m done.

I hope. I hope I will notice the impulse before the words come out. It can be so automatic. Once you start to consider retirement, it’s unnerving how attractive it is to say something, to throw in your “Well ACTUALLY…” It’s like being the hard-boiled TV vice cop whose family convinced him to retire, but then without realizing it, ends up embroiled in some wild crime adventure, following clues and chasing crooks across rooftops. He ends up back in that world, fistfighting a drug dealer on top of a moving train, not because he consciously decided to go back to the grind, but because his detective instincts were sharper than his awareness of what he was doing.

So we’ll see how things go in retirement. Already I’m noticing how often the impulse comes up. I’ve deleted so many half-written Reddit replies that I wonder if I ever contributed anything other than contradiction and snark.

I invite you to join me, if you’re a long-time Belief Patrol veteran. Let’s leave the swashbuckling game for good and go play tennis. We can still express our views in a thousand other ways that aren’t so indulgent and harsh. You have this freedom, and I don’t blame you if you didn’t see it. Already I can tell you it’s way better to be retired. But I won’t argue the point.”

Czeslaw Milosz, "A Song On The End Of The World"

"A Song On The End Of The World"

“On the day the world ends
A bee circles a clover,
A fisherman mends a glimmering net.
Happy porpoises jump in the sea,
By the rainspout young sparrows are playing
And the snake is gold-skinned as it should always be.

On the day the world ends
Women walk through the fields under their umbrellas,
A drunkard grows sleepy at the edge of a lawn,
Vegetable peddlers shout in the street
And a yellow-sailed boat comes nearer the island,
The voice of a violin lasts in the air
And leads into a starry night.
And those who expected lightning and thunder
Are disappointed.
And those who expected signs and archangels’ trumps
Do not believe it is happening now.
As long as the sun and the moon are above,
As long as the bumblebee visits a rose,
As long as rosy infants are born
No one believes it is happening now.

Only a white-haired old man, who would be a prophet
Yet is not a prophet, for he’s much too busy,
Repeats while he binds his tomatoes:
There will be no other end of the world,
There will be no other end of the world.”

~  Czeslaw Milosz 

"You Can Do Something..."

"The Systems President"

"The Systems President"
by Scott Adams

"Was President Trump’s first attempt at getting a healthcare bill a failure? Your answer to that question probably depends on whether you are a goals-thinker or a systems-thinker. If you see the world in terms of goals, you would say the healthcare bill did not get enough votes on the first try, and therefore it is clearly a Trump/Ryan failure. But if you see the world in terms of systems, things look a lot better. I talk about the advantages of systems over goals in my book. The quick summary is that a system is something you do on a regular basis that improves your odds of success in a non-specific way. Systems-thinkers choose paths that allow them to come out ahead in the long run even if they appear to be “failing” along the way.

For example, if you are a founder of a startup that doesn’t work out, you usually end up with new skills. Maybe you also gain new contacts in the industry, more insight into the market, and that sort of thing. Those new assets make your odds of success on the next startup far better.

College students are systems-people. They go to class and study every day without knowing precisely where their careers will lead them. All they know is that a college degree gives them more options and better odds of success. That’s a good system.

I’ve blogged about my main system in life that involves building my Talent Stack. I figure out which skills I need to add to the ones I already have to make myself unique and valuable in the marketplace. For example, right now I’m building out my skillset for livestreaming over Periscope and YouTube. That skill goes well with my blogging. I don’t know exactly where that all ends up, but I know my options will increase with my Talent Stack.

With that bit of background on systems, let’s get back to healthcare. As a systems-thinker, I don’t see the first attempt at a GOP healthcare bill as a failure. I see it as part of Trump’s normal systems-thinking approach. The tell for a good system is that failure puts you AHEAD. And that’s exactly what happened.

By the way, I told you during the campaign that one of Trump’s signature moves is creating two ways to win and no way to lose. He did that again with healthcare. Here were his two ways to win:

1. Healthcare bill gets passed on the first try. Trump looks like an effective leader. The details of the bill get improved over time.

2. The healthcare bill does NOT pass on the first try. This softens up the far right by branding them villains. Now they have to compromise on the next bill or watch as centrist Democrats enter the conversation. Meanwhile, the clock is ticking on Obamacare, and the conditions for compromise are IMPROVING EVERY MINUTE. That’s what the Master Persuader tells us happens when you “walk away from the table” like you mean it. Trump just walked away from the table to go work on tax reform. If you watch his Twitter feed, you know he is winking at the public and telling us to stay tuned on healthcare.

Meanwhile, a fascinating thing is happening outside of government. Watch how many private citizens are looking into the details of healthcare reform and even proposing their own solutions on blogs and articles. The nation is engaged on the topic in a way that looks like a self-organizing system. All the public needs is some sort of common website that is designed to discuss the pros and cons of the various ideas in plain language so the best ones can bubble up to the top.

I’ve blogged before that the United States is no longer strictly a Republic. Social media creates a direct-democracy option in the sense that public opinion can be so strong that politicians have to bend to it. But social media only has power if it can focus on something specific. Until the public comes up with its own healthcare plan, social media is powerless.

But consider our unique situation. As far as we citizens can tell, Congress is no longer functional for any issue that has as many lobbyists as the healthcare topic. They can’t get it done on their own. Too many industry-created roadblocks. Social media, and the weight of public opinion, could overcome any roadblocks in Congress by making it impossible for politicians to get reelected if they ignore the public’s preferred plan. But the public has no preferred plan. There is only public confusion about the options.

As a citizen, I call upon the Trump administration to help the public create a system to sort out the best healthcare options for the country, free from the pressure of lobbyists. Just tell us which website to look at, and we’ll do the rest. When we (collectively) have a good set of proposals (let’s say three different plans), Congress can turn them into bills and vote. If the public takes sides with one of the bills, that helps to neuter the lobbyists. Lobbyists know politicians need to get reelected. And that means lobbyists are helpless when the public and the politicians are on the same side.

I don’t like living in the “can’t do” country. If Congress can’t get healthcare fixed, the public appears ready and willing to fill the gap. All we need is a preferred website to focus that energy. Better yet, let’s see the debate on healthcare as a limited engagement reality TV show. Bring on the experts on each mini-topic (such as selling insurance across state lines) and have them try to convince a panel of business-expert judges that their plan is the best. I’d watch it."

Musical Interlude: Leonard Cohen, “Anthem”

Leonard Cohen, “Anthem”

"How It Really Is"

"For Sale: Your Private Browsing History"

What goes around, comes around...
"Internet Users Turn the Tables, Raise Funds to Buy Lawmakers Browsing Histories."
"Internet users are fighting back after Congress voted to block Obama-era internet privacy protections. Two fundraising campaigns have so far raised more than $215,000 to purchase and reveal lawmakers’ browsing histories. Everything from their medical, pornographic, to their financial and infidelity. Anything they have looked at, searched for, or visited on the Internet will now be available for everyone to comb through." 
Learn More: -

"Help me raise money to buy the histories of those who took away your right to privacy for just thousands of dollars from telephone and ISPs. Your private data will be bought and sold to marketing companies, law enforcement. Let’s turn the tables. Let’s buy THEIR history and make it available."

"Broken America"

"Broken America"
By Michael Snyder

"Is this the beginning of the end for the United States of America? It has been said that a house divided against itself will surely fall, and today we live in a shattered union. In all my years, I have never seen so much strife, discord, bitterness and resentment in this country. Everyone can see what is happening, but nobody can seem to stop it. Politically, you have got tens of millions of people trying to pull America one way, and you have got tens of millions of people trying to pull it the exact opposite way. As I discussed in a previous article, the term “civil war” is now being thrown around by some pundits even though nobody has started shooting yet. We are a deeply divided and broken nation, and if we don’t find a way to fix things America will not survive.

Every survey and opinion poll that has been taken recently backs up what I am saying. For example, a Gallup survey that was conducted after the election in November found that an all-time record high 77 percent of all Americans believe that “the nation is divided on the most important values”: "Seventy-seven percent of Americans, a new high, believe the nation is divided on the most important values, while 21% believe it is united and in agreement. Over the past 20+ years, the public has tended to perceive the nation as being more divided than united, apart from two surveys conducted shortly after the 9/11 terrorist attacks."

So how do you fix this? Nobody can force half the population to suddenly change their views on the most important issues of the day. Earlier today, I wrote an article about how America is becoming a “politically-correct madhouse“, and there really is no compromising with the forces of political correctness. Either you get in line or you are the enemy.

Once upon a time the values enshrined in the U.S. Constitution by our founders united us, but today about half the country has completely rejected those values. Those that would like to restore our constitutional values find themselves diametrically opposed to the agenda that progressives are trying to shove down our throats, and personally I don’t see much room for compromise between the two sides. Given enough time, one side would ultimately vanquish the other side, but I don’t know if America has enough time left for that to happen.

There were some that had been hoping that our new president would unite the country, but you can throw that idea right out the window. According to numbers from Public Policy Polling, nearly half the nation already wants him to be impeached: "On our first poll of his Presidency voters were evenly divided on Trump, with 44% approving of him and 44% also disapproving. Now his approval rating is 43%, while his disapproval has gone all the way up to 53%. If voters could choose they’d rather have both Barack Obama (52/44) or Hillary Clinton (49/45) instead of Trump."

Just three weeks into his administration, voters are already evenly divided on the issue of impeaching Trump with 46% in favor and 46% opposed. The political divisions in this nation are just going to grow worse and worse. But just because we vehemently disagree with someone politically does not mean that we should hate that person.

I know that it can be infuriating to see some politician get up and start spouting off ideas that would be extremely damaging to this country. But if we choose to hate our political “enemies”, we become part of the problem. It is easy to love someone that agrees with you about most things. The real challenge is finding a way to love those that believe things that you may find truly repulsive. That doesn’t mean that you have to agree with what they believe. I am not saying that at all. You can disagree very strongly with someone and still love that person.

Unfortunately, the hearts of most people have grown cold in America. As hatred, anger and frustration continue to grow, it is only a matter of time before we start seeing outbursts of violence. Rioting, looting and civil unrest are going to become commonplace in communities all over the U.S., and eventually some of our major cities will burn. In my latest book I warned that the “thin veneer of civilization that we all take for granted will disappear”, and thousands upon thousands of Americans that can see this coming are already fleeing the big cities.

What particularly disturbs me is when I see people that are supposed to be on the same side fighting each other. If you are around someone long enough, eventually they are going to do or say something to offend you. None of us is going to agree 100 percent on everything, and it is a horrible shame to allow one disagreement to ruin what should be a great relationship.

If you do not learn to forgive, every relationship that you ever have in your life will ultimately fail, because everyone is going to let you down at some point. And you may think that you are making the other person pay a price by refusing to forgive, but the truth is that you will be the one that will end up suffering.  Even medical science has found that there are health benefits to forgiving and that unforgiveness can actually help bring on serious illnesses. The following comes from the official website of Johns Hopkins Medicine: "Whether it’s a simple spat with your spouse or long-held resentment toward a family member or friend, unresolved conflict can go deeper than you may realize - it may be affecting your physical health. The good news: Studies have found that the act of forgiveness can reap huge rewards for your health, lowering the risk of heart attack; improving cholesterol levels and sleep; and reducing pain, blood pressure, and levels of anxiety, depression and stress. And research points to an increase in the forgiveness-health connection as you age.

“There is an enormous physical burden to being hurt and disappointed,” says Karen Swartz, M.D., director of the Mood Disorders Adult Consultation Clinic at The Johns Hopkins Hospital. Chronic anger puts you into a fight-or-flight mode, which results in numerous changes in heart rate, blood pressure and immune response. Those changes, then, increase the risk of depression, heart disease and diabetes, among other conditions. Forgiveness, however, calms stress levels, leading to improved health."

There are people that are reading this article that need to pick up the phone right now and apologize to someone that they have been refusing to forgive. Yes, without a doubt that would be difficult. But you might just be surprised how much grace a little humility can unleash.

You may not be able to fix our broken nation, but you certainly can fix the broken relationships in your own life. And if millions of Americans decided to choose love and forgiveness rather than hatred, anger, bitterness and resentment, it would most definitely have a transformative effect on the entire country.

I would like to close with some very wise words from Dr. Martin Luther King Jr.: “Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that.”

A Mrs. Powel of Philadelphia asked Benjamin Franklin, 
“Well, Doctor, what have we got, a republic or a monarchy?” 
With no hesitation whatsoever, Franklin responded, “A republic, if you can keep it.”
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