“Forget This Idea of Seeking Happiness” by Paulo Coelho
“Countries where income is under US$ 10,000 a year are countries where the majority of the population is unhappy. However, it was discovered that from that figure upwards, monetary difference is not all that important. A scientific study conducted on the 400 richest persons in the United States shows that they are only slightly happier than those who earn US$ 20,000. The logical consequence: of course, poverty is something unacceptable, but the old saying that “money does not bring happiness” is being proved in laboratories.
Happiness is just another of the tricks that our genetic system plays on us to carry out its only role, which is the survival of the species. So, to force us to eat or make love, it is necessary to add an element called “pleasure”. However happy people say they are, nobody is satisfied: we always have to be with the prettiest woman, buy a bigger house, change cars, desire what we do not have.
This is also a subtle manifestation of the instinct of survival: at the moment when everyone feels completely happy, no-one will dare to do anything different and the world will stop evolving. Therefore, both on the physical plane (eating, making love) and on the emotional plane (always wanting something we do not have), the evolution of humanity has dictated one important and fundamental rule: happiness cannot last. It will always be made of moments, so we can never get comfortable in an armchair and just contemplate the world.
Conclusion: Better forget this idea of seeking happiness at any cost and look for more interesting things like unknown seas, strangers, provocative thoughts, risky experiences.”
“In Pain and Joy of Envy, the Brain May Play a Role”
by Natalie Angier
"He who does not think that what he has is more than sufficient
is an unhappy man, even if he is the master of the whole world."
"Most human vices have enough sense to be very, very tempting. Lust, gluttony, sloth, hurling powerful if unimaginative expletives at a member of the political opposition, buying a pair of Thierry Rabotin snakeskin printed shoes at 25 percent off even though you just bought a pair of cherry-red slingbacks last week- all these things feel awfully good to indulge in, which is why people must be repeatedly abjured not to.
One vice, however, dispenses with any hedonic trappings and instead feels so painful you would think it was a virtue, except that there’s no gain in lean muscle mass at the end: envy. Skulking at sixth place on traditional lists of the seven deadly sins, right between wrath and pride, envy is the deep, often hostile resentment you feel toward somebody who has something you want, like wealth, beauty, a promotion or the admiration of peers. It is a vice few can avoid yet nobody craves, for to experience envy is to feel small and inferior, a loser shrink-wrapped in spite.
“Envy is corrosive and ugly, and it can ruin your life,” said Richard H. Smith, a professor of psychology at the University of Kentucky who has written about envy. “If you’re an envious person, you have a hard time appreciating a lot of the good things that are out there, because you’re too busy worrying about how they reflect on the self.”
Now researchers are gleaning insights into the neural and evolutionary underpinnings of envy, and why it can feel like a bodily illness or a physical blow. They’re also tracing the pathway of envy’s equally petty foil, the sensation of schadenfreude- taking pleasure when those whom you envied are themselves brought down low.
Reporting in the journal "Science," researchers at the National Institute of Radiological Sciences in Japan and their colleagues described brain-scanning studies of subjects who were told to imagine themselves as protagonists in social dramas with characters of greater or lesser status or achievement. When confronting characters that the participants admitted to envying, brain regions involved in registering physical pain were aroused: the higher the subjects rated their envy, the more vigorously flared the pain nodes in the brain’s dorsal anterior cingulate cortex and related areas.
Conversely, the researchers said, when subjects were given a chance to imagine the golden one’s downfall, the brain’s reward circuits were activated, again in proportion to the strength of envy’s sting: the subjects who felt the greatest envy the first time around reacted to news of their rival’s misfortune with a comparatively livelier response in the dopamine-rich pleasure centers of, for example, the ventral striatum. “We have a saying in Japanese, ‘The misfortunes of others are the taste of honey,’ ” said Hidehiko Takahashi, the first author on the report. “The ventral striatum is processing that ‘honey.’ ”
Matthew D. Lieberman of the psychology department at the University of California, Los Angeles, who co-wrote a commentary that accompanies the report, said he was impressed by how the neural correlates of envy and schadenfreude were tied together, with the magnitude of one predicting the strength of the other. “This is the way other needs-processing systems like hunger and thirst work,” he said. “The hungrier or thirstier that you feel, the more pleasurable it is when you finally eat or drink.”
The new findings are preliminary, and some scientists have expressed reservations about what they or other scanning results from the fast-moving field of behavioral neuroscience really mean. Nevertheless, the research throws a spotlight on a potent emotion that we deny or deride but ignore at our peril. Much of the recent economic crisis, Dr. Smith suggested, may well have been fueled by runaway envy, as financiers competed to avoid the shame of being a “mere” millionaire.
Envy can be seen in other social animals with personal reputations to defend. Frans de Waal of the Yerkes National Primate Research Center in Atlanta noted that monkeys were perfectly happy to work for cucumber slices until a person started giving one monkey a preferred treat like grapes. Then the others stopped working for cucumbers and started nursing a grudge. “The underlying emotion is likely envy or resentment,” Dr. de Waal said.
When children realize they have siblings, their lives become dominated by the calipers of envy. Why does she always get to sit by the window? His cupcake has more sprinkles! No siblings? No problem: you can envy the cat.
Researchers often distinguish between envy and the jealousy you feel by, say, seeing a loved one flirt at a party. Jealousy is a triangle, Dr. Smith said, in which you fear losing a loved one to the embrace of another. Envy is a two-bodied affair, an arrow proceeding from your covetous breast to the heart of the well-endowed Other. Yet envy is restless and gregarious and can embrace popular cliques, honor rolls and entire nation-states. “It’s a fact of life that we pay close attention to status, to who’s doing well and who isn’t and how we stand in comparison to others,” said Colin W. Leach, an associate professor of psychology at the University of Connecticut, in Storrs, who studies envy.
As a rule, we envy those who are like us in most ways- in sex, age, class and curriculum vitae. Potters envy potters, Aristotle observed.
Paradoxically, this most socially driven of emotions is among the least socially acceptable to confess to. Jealous hostility toward a romantic rival is an acceptable topic for conversation. Envious hostility toward a professional rival is more like an embarrassing body function: please do not share. When asked by researchers about their envy, study participants have said, “I’m privately ashamed of myself.”
As evolutionary scientists see it, envy’s salient features- its persistence and universality, its fixation with social status and the fact that it cohabits with shame- suggest that it serves a deep social role. They propose that our invidious impulses may help explain why humans are comparatively less hierarchical than many primate species, more prone to a rough egalitarianism and to rebelling against kings and tycoons who hog more than their fair share.
Envy may also help keep us in line, making us so desperate to look good that we take the high road and start to act good, too. We struggle with our private envy, our longing for more esteem than we command, and the struggle only sharpens the painful contrast between the imagined perfection of the envied adversary that we have enshrined on an imaginary throne, and the defective merchandise that is ourselves.
“If you desire glory, you may envy Napoleon,” Bertrand Russell said. “But Napoleon envied Caesar, Caesar envied Alexander, and Alexander, I daresay, envied Hercules, who never existed.” If envy is a tax levied by civilization, it is one that everyone must pay.”
“Bad things do happen; how I respond to them defines my character and the quality of my life. I can choose to sit in perpetual sadness, immobilized by the gravity of my loss, or I can choose to rise from the pain and treasure the most precious gift I have - life itself.”
"Again, do you not see that even stones are conquered by time, that tall turrets fall and rocks crumble, that the gods’ temples and their images wear out and crack, nor can their holy divinity carry forward the boundaries of fate, or strive against nature’s laws? Again, do Ave not see the monuments of men fall to pieces, asking whether you believe that they in their turn must grow old? Do we not see lumps of rock roll down torn from the lofty mountains, too weak to bear and endure the mighty force of time finite? For they would not fall thus suddenly torn off, if they had endured all through from time infinite all the wrenchings of the ages without breaking up.
Again, do but behold that which around and above comprehends all the earth in its embrace: if it makes from itself all things, as some declare, and takes them back when they are destroyed, then the whole consists of a body subject to birth and death. For whatever increases and nourishes other things from itself must be diminished, and remade when it receives things back.”
Freely download "Of The Nature of Things", by Lucretius [Titus Lucretius Carus], here:
“Stars are sometimes born in the midst of chaos. About 3 million years ago in the nearby galaxy M33, a large cloud of gas spawned dense internal knots which gravitationally collapsed to form stars. NGC 604 was so large, however, it could form enough stars to make a globular cluster.
Click image for larger size.
Many young stars from this cloud are visible in the above image from the Hubble Space Telescope, along with what is left of the initial gas cloud. Some stars were so massive they have already evolved and exploded in a supernova. The brightest stars that are left emit light so energetic that they create one of the largest clouds of ionized hydrogen gas known, comparable to the Tarantula Nebula in our Milky Way's close neighbor, the Large Magellanic Cloud.”
"The eternal silence of infinite spaces frightens me. Why now rather than then? Who has put me here? By whose order and direction have this place and time have been ascribed to me? We travel in a vast sphere, always drifting in the uncertain, pulled from one side to another. Whenever we find a fixed point to attach and to fasten ourselves, it shifts and leaves us; and if we follow it, it eludes our grasp, slips past us, and vanishes for ever. Nothing stays for us. This is our natural condition, most contrary to our inclination; we burn with desires to find solid ground and an ultimate and solid foundation for building a tower reaching to the Infinite. But always these bases crack, and the earth obstinately opens up into abysses. We are infinitely removed from comprehending the extremes, since the end of things and their beginning are hopelessly hidden from us in an encapsulated secret; we are equally incapable of seeing the Nothing from which we were made, and the Infinite in which we are swallowed up."
“As upright primates, the sky is half of our visual field, but we give it only a tiny fraction of our attention. Food, drink, sex and shelter are all to be found close to the ground. What goes on above our heads is mostly irrelevant.
Here in Ireland the sky is much more than half our visual field; we couldn't ignore it if we wanted to. Our cottage is perched on a hill above Dingle Bay, and beyond the garden wall the land slopes to the sea, as if trying to get out of the way, surrendering the view to- air. Insistent, in-your-face, not-to-be-ignored nitrogen, oxygen and water vapor. A big floor-to-ceiling canvas on which wind, water and light create an ever-changing spectacle- gaudy gobs and brushstrokes of color, atmospherics managed by Maxfield Parrish.
It's the water, of course, that makes our skies what they are- the billowing cumulous clouds that pile up over the bay, the dense white blanket that lies on the mountain like sugar frosting or flows down from Mam na Gaoithe (the Windy Pass) like a slow, soft glacier, the rain that buckets against the slates, the rainbows- sometimes two or three a day- all that moisture sucked up into the air out there over the anomalously warm North Atlantic, then pushed in front of our pop-eyed view.
We don't have a television. But last evening we lay in bed and watched rainbows and pink castles come and go. Commercial free.”
"When asking the question “What is the meaning of life?”, you may want take a step back, reflect and begin by asking, “What is meant by the phrase ‘the meaning of life’”?
Three Types of Meaning: OK, let’s start with a confusing thought. The word meaning, itself, has many meanings. Take these three examples:
Linguistic meaning or semantic meaning is the actual meaning of words. For instance, the word “bachelor” in English means an unmarried, adult male. Or the words “rouge,” and “red” and “marpo” mean the same things in French, English and Tibetan respectively.
Indicative meaning. For example, looking up at the sky and saying, “Those clouds mean rain.” You’re not talking about linguistic meaning or semantic meaning. The clouds aren’t literally signs or symbols in a language and we’re not trying to interpret them. Rather what we mean is they indicate to us that it’s going to rain.
Sense of meaning is when you talk about significance; something being important to you. For example, one might reference their wedding band and say, “This ring is of great meaning to me.” It represents my marriage vows. Or, “The monument I visited today on the National Mall is deeply significant;” it resonates with me. It gives me a certain sense of value and importance. It’s the third of these, this notion of significance, that’s clearly the core meaning when we ask the question, what is the meaning of life?
Pointing To Something Beyond Us: While the notion of significance is the core meaning, it’s not the only meaning. When you are asking why life is significant; why it’s important; why it matters; the others are important too. In fact, all three of these senses of meaning, even though they’re different from one another, are related to one another in an important way – in each case, we’re talking about the sense of pointing to something outside ourselves.
All of these senses of meaning have a sense of one thing pointing to or indicating something well beyond it. In general when we ask the question “What is the meaning of life?” we’re asking the question, what is it beyond our existence that gives our lives significance?
Why Search For The Meaning Of Life In The First Place? Here’s another important question: What raises the question of the meaning of life in the first place? Why is this one of the questions that we feel absolutely bound to answer? There are several things that lead us to raise that question.
One is a fundamental awareness, that human beings develop at some point, of our finitude in a vast and infinite universe; that we are very small, limited and ephemeral phenomenon in a universe that goes far beyond us. Finitude has several different dimensions. On the one hand there is the obvious finitude in space and time itself. If you think about the expanse of the world and the universe in which we live, it is quite vast. The globe that we dwell on right now is enormous. It is dwarfed by the solar system; a solar system that is no more than a spec in a galaxy and a galaxy that is one of billions in a galaxy cluster.
Yet, even if you restrict your gaze and just think only about human history, you see that we’re very small moments in time. We’re here for a few years; maybe even a hundred years if we’re lucky, but in the course of human history which extends over hundreds of thousands of years already, that’s absolutely nothing. What is it about our ephemeral lives in human history that makes them worth living in the first place?
What Makes Us Human? One of the things that you need to ask if you’re asking about the meaning of life is just what it is for a life to be a human life. You need to ask at some point what is it that makes us characteristically human in the respect that is relevant to asking this question.
Is the answer biological? To be human is perhaps to have a certain kind of DNA; to have a certain genetic code; or perhaps it’s to have certain organs – for example, the pre-frontal cortex of the brain. We might say to be human is to be biologically like us; to be genetically related to us; to have the kind of functioning organs that we do and ask what is it about that biological nature that’s important and significant.
Is the answer to the question psychological?It’s not the biology or the brain; it’s how we think. It’s what goes on in our minds. It’s what we’re capable of deducing; the intentions we’re capable of forming and so forth.
Is the answer to the question spiritual? We might say that what makes somebody distinctively human involves something like their relationship to a deity, their relationship to a religious practice, to a religious tradition or something like that, something that transcends biology and psychology and is somehow a deeper effect.
Is the answer to the question, the moral dimension? Is it our capacity for caring about each other, for understanding the difference between right and wrong, for standing under moral imperatives, and for taking responsibility for our actions that makes us human. We might say that anything biologically, psychologically, spiritually different from us, however different it may be, if it’s morally like us that’s the kind of thing whose life is significant.
To What Extent Are We In Control Of Our Lives? Another question to raise, before you can begin to ask the big question, is: To what extent are we in control of our lives? Many people would say that our life is meaningful only to the extent that we are able to do something with it. It may be that everything that we do and everything that happens to us is completely causally determined. Or it might be that we’re free and we have a deep free-will. In either case our lives might be meaningful or meaningless, but the sense of meaning is going to be very different.
On the other hand it might be that you can find a middle path; that certain things about us are determined, but certain things about our lives are free. Perhaps the meaning lies in the places where we can make choices. It might be that the meaning lies in exactly how we’re determined; it might be, for instance, that it’s what God has in mind for us that makes our lives meaningful. All of these questions will require being raised.
Is There One Single Answer To The Meaning Of Life? There’s yet another important question to ask. Is there really only ONE right answer to the question, “Is there a meaning of life?” And if there is one answer what is the ONE meaning? We must consider that this might not be true; there might be many meanings of life. There may be many different answers. For instance, the answer might vary over time; it might be that in one era the meaning of life is one thing, but in another era, it’s a different thing. It may be that what makes a life meaningful for a small child is different from what makes life meaningful to an adult; different again from what makes life meaningful to an elderly person.
Meaning may vary not only over cultural time, but it might vary over individual time. For example, the meaning of life for somebody growing up in classical India is different from the meaning of life growing up in modern Europe; different again from the meaning of life growing up in contemporary United States and there will certainly be many different answers to the question of the meaning of life that come from an individuals at different stages in their own lives.
What Would Count As An Answer For The Meaning Of Life? What would count as an answer, to the question, “what is the meaning of life?” One kind of answer might be: taking very seriously the problem of our finitude and the infinitude of the universe. That the only thing that could be an answer to the meaning of life question would be some account of the relationship between finite beings like us and a vast, infinite universe. That’s one possibility.
Another possibility is we take the spiritual dimension to humanity more seriously. That the only possible answer to the question, “what is the meaning of life?” is an answer that gives us some sense of what our relationship to a divinity; to a god, to a greater spiritual existence.
There are other possibilities, too. We might be asking about the relationship of our own lives to the lives of those around us, to our immediate past, to our ancestors and to those who come after us.For example placing very special importance on the relationship between our own lives, the lives of our ancestors, and the lives of our children in determining what could make our own lives meaningful.
Individual Dimensions To The Meaning Of Life: There are two big dimensions that we need to consider as we pose the big question of the meaning of life – the personal dimension and the collective or relational dimension.
When you ask the question in the personal dimension, you’re asking: “If I think of myself as an individual worrying about my own life, in what does the meaning of my life consist?” You might have a number of different kinds of answers to that. You might say: a meaningful life is a life of reason – a life that is led reflectively, thoughtfully, where you make choices in an informed way, where you’ve got good reasons for the things that you do, and you can look back on your life and say, “Yes I did the right things and I did them for the right reasons.”
On the other hand it might be that you say: a meaningful life would be a life of faith, a life in which you find some higher value, some spiritual value, and am able to accommodate yourself and your concerns to what you see as the dictates of that higher spiritual value.
Or you might say what makes your life meaningful is that you’re able to lead it naturally in harmony with your own nature, in harmony with the nature that you find around you, where you think of yourself fundamentally as an organism and you try to shed social accretions, get back to your natural way of being and live that way.
Collective Dimensions To The Meaning Of Life: Beyond this individual dimension there’s a second, social dimension to thinking about the meaning of life; it’s the dimension of connectedness. In this dimension you need an account of what your relationships are to each other, to the broader world, to the universe, to our society, in order to answer the question, what is the meaning of life.
On this dimension you might ask the question: Are we primarily independent agents in voluntary association with one another? That is, when we think about our society is it a group of individuals who get together and say, let’s form a society and make some agreements, as we might see in the social contract tradition where we see government and social institutions as constituted and legitimated by the wills of individuals.
It might be that we are essentially social beings, that that’s what our fundamental nature is, and that when we think about ourselves as individuals that’s no more appropriate than it is to think of my hand as an individual instead of as a part of my body.
Do we choose our roles in society? Or does society give us our role? Is our context not primarily social but natural? Are we fundamentally animals living in an ecosystem, and so that what gives our lives meaning is our connection to other animals and plants in that broader ecosystem? Are we simply tiny parts of a very vast cosmos and that we need to think of ourselves relationally in relation to the whole? There are so many questions to consider and so many possible answers to choose.”
"The Greeks took for granted a warrior-ethic ("aristeia," the virtues, values, culture and competence of "aristoi") not just between man and nature, and one city and another, and in the competitive contests (agones) between one person or point of view and another, but most especially between the individual mind striving for illumination and the vast surrounding obscure chaos of all that we do not know or understand or, as yet, have the resources to master. Humans from the earliest days of their lives have already planted their feet on one of two paths, one leading toward self-illumination or a determination to live life knowingly, as cognoscenti or "knowers," and one leading toward the absolute minimum of effort at illumination, a default-mentality marked by the vices of ignoranti, the countless herds of the mostly oblivious and passive, who are content merely to be, to drift and be driven, not to be morally or philosophically accountable for themselves.
I can't convince myself that it does much good to try to challenge the everyday political and other delusions and dementias of Americans at large. Their contained and confined mentalities by far prefer the petty and parochial prisons of the kind of sense they have been trained and rewarded for making out of their lives (and are punished for deviating from them). What it costs them ultimately to be such slaves and infants and ideological zombies is a thought too monstrous and rending and spiky for them even to want to glance at."
"Watch money. Money is the barometer of a society’s virtue. When you see that trading is done, not by consent, but by compulsion- when you see that in order to produce, you need to obtain permission from men who produce nothing- when you see that money is flowing to those who deal, not in goods, but in favors - when you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you - when you see corruption being rewarded and honesty becoming a self-sacrifice - you may know that your society is doomed.”
"Millions are going to lose their jobs in the coming recession. Will you?"
"Imagine the following scene playing out at work tomorrow: You arrive in the morning to find a note reading ‘HR wants to see you’. About what?, you wonder. Seeing your HR manager already in the conference room with the door closed, you fidget as you wait. A knot begins to form in your stomach that gets tighter as the minutes tick by. Suddenly, the door opens. A colleague stumbles out, looking ashen-faced. Then the HR manager’s head emerges, notices you and says “Ah, please come in”. “I’m sorry to tell you that the company is letting you go,” she begins. “Sales have slumped and we simply can’t employ as many people. It’s nothing personal.”
And just like that, your job is gone. You’ll get a month’s salary as severance pay, plus two-weeks more if you sign a ‘non-disparagement’ clause. And they’ve just handed you a pile of forms that supposedly will guide you through the process of applying for COBRA health coverage and unemployment benefits, should those be necessary. And that’s it.
Oh, they’ve already taken your computer back to IT. You’ve got 15 minutes to collect any personal items and say your goodbyes. But please don’t linger. We’d hate to get Security involved… Thanks for your service! And best of luck in your next venture!
What would you do if this happened to you tomorrow? Really chew on that for a minute. Would you feel surprised? Liberated? Petrified? What would your job prospects look like? Are you confident you could get re-hired quickly? Or are you looking at months (or longer) of unemployment?
What will it do to your household finances if you’re out of work for a prolonged time? Are you the primary breadwinner? Do you have other income or substantial savings that can sustain you? If not, how would you plan to make ends meet?
Most people are caught flat-footed by layoffs. There’s a complacency a steady paycheck offers that’s instantly ripped away by a pink slip. Few people are ready — emotionally, professionally, or financially — for the abrupt ending to the status quo a layoff brings. Mike Tyson once eloquently quipped: “Everybody has a plan until they get punched in the mouth.” Similarly, everybody can afford to be optimistic about tomorrow until they get canned.
Have ‘Layoff Anxiety’? You’re Not Alone. If the thought-exercise above gave your stomach butterflies, you’re not alone. Nearly half (48%) of US workers report experiencing ‘layoff anxiety’. And, this is during the “good times”, folks. Officially, we’re still in the longest economic expansion in US history.
What’s it going to be like when this long-in-the-tooth expansion ends, as all inevitably must? And as we’ve been furiously covering here at PeakProsperity.com, it sure looks like the end is fast arriving. The inverted yield curve in US Treasurys, slowing US growth and negative growth rates in major European economies, anemic global shipping volumes, and a raft of other dependable indicators are flashing warnings that the world economy (including the US) is plunging towards recession. A recession that corporate America is woefully unprepared for, due to record levels of debt.
9 Trillion Reasons To Reduce Headcount: In response to the past decade of extremely cheap and plentiful credit supplied by the world’s central banks QE (quantitative easing) efforts, company executives have borrowed much more aggressively than in the past. Often to repurchase their company’s own shares in hopes of boosting its stock price (and thus their stock-based compensation packages).
And a worrisome number (hundreds of $billions) of such corporate loans made over the past several years have been low quality, high-risk, and covenant-lite. As a result, today’s US companies are as or more dangerously leveraged than ever before. More than $9 Trillion of debt now burdens the balance sheets of America’s corporations:
As growth continues to slow and corporate profits decline, debt service takes up an ever-greater percentage of cash flows. At some point, headcount cuts become unavoidable.
The Robot Took My Job: On top of that, as we’ve been long warning about here at PeakProsperity.com, employers currently have a tremendous perverse incentive to automate and replace human labor with technology. The simple and harsh truth is that it’s expensive, and becoming more so, to employ humans. Wages, health care, retirement benefits, workers comp, OSHA regulations, lawsuits, training, vacations, sick days — it all adds up. Machines free employers from all of those costs, headaches and potential liabilities.
Meanwhile, technological advancements in robotics and AI (artificial intelligence) are on an exponential track. Capabilities are skyrocketing and costs are coming down. With the ability to borrow at rock-bottom interest rates, is it any surprise that companies are investing in automation as fast as they can?
White-shoe consulting firm McKinsey predicts that 50% of current work activities are at risk of being automated by 2030, and that by that time, 400-800 million workers worldwide will be displaced by technology — creating “a challenge potentially greater than past historic shifts”.
A historic transition away from human towards automated labor is underway. It’s happening in every industry and will impact every job function, at every level of the org chart. And unlike with outsourcing or off-shoring, once these jobs are successfully automated, they’re “gone” as far as human workers are concerned. They’re never going to be un-automated.
It Has Already Begun: Remember the mass layoffs of 2008 and 2009? When thousands of people instantly lost their jobs as companies started jettisoning workers? Well, they’re back.
In 2019 so far, we’ve seen reductions-in-force reported across a number of industries from the likes of HSBC (4,750 jobs), Nissan (12,500 jobs) and Deutsche Bank (18,000 jobs). Other well-known brands letting employees go include Siemens, Uber, US Steel, Kellogg’s, Ford, Disney, and United Airlines.
At this stage, it’s not (yet) like the carnage seen during the Great Recession. Remember how god-awful scary this was, as hundreds of thousands of people were laid off every month for two years?
Click image for larger size.
8.8 million jobs were lost during this period. When layoffs are that widespread, it’s just a numbers game. Amongst yourself, your family, and your friends — at least some of you are going to fall victim. How bad could things be next time? Bad enough to take protective action, we think. And it’s not that hard for us to make the argument that the future wave of mass firings may be substantially worse. So don’t rest on your laurels.
Signs Of Trouble To Watch For: What early-warning indicators can you monitor to assess whether your company, or your specific job, is at risk?
Company Risk Factors: First, it helps to look at the industries that shed the most workers during the Great Recession. History doesn’t repeat itself exactly, but it often rhymes:
Click image for larger size.
Do you currently work in one of these industries? If so, the above chart should give you a general sense as to how yours will fare relative to others should we indeed re-enter recession soon. But not all companies within an industry are created equal. How can you tell if you’re currently employed by one of the more vulnerable players? Here are classic signs of trouble to look out for:
• Declining financials — Does your company have a higher Debt/Equity ratio that its industry peers? Are revenues and/or earnings flatlining or decreasing? Are Accounts Payable increasing as a percentage of total Liabilities? All are potential indications of a company on shaky ground.
• Freezes — Has your company announced a freeze on new hires, budgets and/or bonuses? These are all signs of tightening pursestrings, and they constrain prospects for future growth. It’s rare for sizable layoffs to be announced before any, if not all, of these is tried first.
• Postponement of key projects — similar to freezes, big deployments are often pushed back or shelved completely in attempt to reduce costs before headcount cuts are considered. Of course, once you reduce your planned projects, you then realize you don’t need as many people…
• Consolidation — this is when business units are collapsed together for ‘greater efficiency’ and ‘cost savings’. This is a sign that pennies are starting to be pinched, and soon “cost savings” starts to look an awful lot like “employing fewer people”.
• Being acquired — in good times and bad, employees at a company being acquired are at greater risk. Acquisitions are intended to unlock “synergies”, which often is a fancy way to say “if we combine our companies, we can fire all the people who have redundant jobs”. Since they don’t have relationships with the power players at the acquiring firm, those being acquired are usually the first to be shown the door.
• Your company is “pivoting” — “pivoting” is the new smokescreen term for “What we’re doing isn’t working so let’s try something else”. True, it’s wise to abandon a doomed path. But not if you’re just trading it for another half-baked idea. While there are examples of pivots that turned a failing enterprise into a world-class success (did you know that YouTube initially started as a dating site?), those are the exceptions.
• Bad news/too many rumors — “Where there’s smoke, there’s fire”. When your company is unfavorably covered by the trade media for long enough, it’s usually for good reason. Just ask the folks who work (or used to) at Sears, Theranos, JC Penny, Toys “R” Us, or Forever 21.
• Senior management leaving — when the rats at the top start leaving the ship at the same time, it’s time to worry. They know a lot more than you do about your company’s condition. Right now, I’d be really worried if I worked at a place like Tesla…
• Sudden stock drop — a strong stock price makes up for a lot of operational deficiencies (such as, in the example of Netflix, Uber or We Work, losing billions in cash flow every year). But when investors abandon the dream underlying your company and the stock starts tanking, life can quickly get a lot worse. Profitability and positive cash flow suddenly becomes matters of life and death. Those working at a high-flier Tech unicorn or starry-eyed start-up need to be attuned to how quickly things can turn should investors sour.
Is There A Target On Your Back? Layoffs are like tossing sand bags out of a sinking hot-air balloon. You throw a few overboard to see if that stops the fall. If it doesn’t, you chuck out a few more. They tend to happen as a sequence. In the first wave, the obvious under-performers are let go. That’s the easy decision, and may even be positive for morale. But if the company is still in trouble, another wave –maybe more — will be needed.
So, how can you tell if you’re at risk for the next wave in the series? Here are some common predictors:
• Your workload is lightening — workers with spare capacity offer a lower ROI (return on investment). Either your company’s throughput is diminishing (a bad sign) or your boss is re-directing your work to other people (a very bad sign).
• Increase in status reports — if you’re suddenly being asked to rationalize and report on all of your activities, it’s usually a sign that someone higher up the chain from you is trying to “justify” the resources in your department. It’s a signal that the future of your department — or you, specifically — is under review.
• “Too” young — historically, younger workers are often the first let go in a layoff as they have the least work experience and the least seniority within the organization. During the GFC, unemployment among young workers nearly doubled from 5.4% in 2007 to 9.2% in 2010.
• “Too” old — in a growing number of industries (Tech, in particular), it’s increasingly common for older workers to be laid off first. Younger workers often are more familiar and facile with the latest software and technology, and they’re often substantially cheaper to employ. They’re willing to work longer hours for less pay and don’t have the benefits footprint that older workers with families do. ‘Ageism’ is fast becoming a common legal complaint in today’s layoffs.
• Your boss suddenly departs — while this may or may not be a sign that your department is losing status within the company, it often means you’re losing your strongest champion within the organization. If your boss leaves abruptly, be sure to connect with her privately to get the inside scoop. Now that she’s not speaking for overall management, she’ll likely to be fully transparent with you about the company’s condition.
• Friction with your boss — while never a promising sign, if you and your boss aren’t getting along, chances are you won’t be at the top of his list of employes to fight to keep during a RIF (reduction in force). In fact, if you’re suddenly experiencing badwill where there was none before, it could be that he’s trying to build a case for making your layoff an “easy call”.
• Being ‘asked’ to take a pay cut — this is a pretty clear sign that you’re less essential to the company than you were previously and/or that your company is *really* hurting cash flow-wise. If you’re ‘asked’ this, take it as a sign from the universe to start updating your resume.
• Being asked to train someone else or an outside firm on your responsibilities — this is another clear “wake up call” that your job is likely on the chopping block. Unless you know for sure you’re getting promoted, take this as a message to expect a visit from HR soon.
• Your spider-senses are tingling — companies are social institutions by design; they’re made up of people (at least, they still are for now). If you notice the execs and senior managers looking stressed or spending a lot of time huddled in conference rooms, if the water cooler talk revolves around company problems, if perks start quickly disappearing, if people start shunning you — these are all warning signs you should heed. Don’t ignore your gut.
• How To Reduce Your Vulnerability: After taking an honest assessment of your job situation, would taking some precautionary measures against a layoff make sense? Spoiler alert: if you’re one of the 132 million full-time employees currently working in the US, the right answer is pretty much always “yes”. There’s simply no good reason to trust your primary/only income source to blind faith.
In Part 2: "The Layoff Survival Handbook", we detail out the steps to take now to reduce your vulnerability to a layoff, and the critical steps to take right away should you become laid off. Many of these will enhance your career trajectory and satisfaction even if a pink slip never arrives. But should one do, you’ll be far better off for having taken them. Given the mounting recessionary risks ahead, we all need to prepare for what’s coming."
"Editor’s note: Here, on this Labor Day weekend, we pause to acknowledge the American worker. In real terms, he has barely budged a jot in 40 years. But why? Today we grope for answers, and take a gander ahead. Will automation put him permanently to pasture?
"Overall U.S. productivity has increased 77% since 1973, the Bureau of Labor Statistics informs us. But average real hourly pay (adjusted for inflation, that is) has barely increased 13% over 45 years. 45 years! Thus the average American worker finds himself a hamster upon a wheel… jogging largely in place.
Here our co-founder Bill Bonner reduces to concrete the abstract plight of the American worker: "In 1971, you could buy a new Ford F-150 for $2,500. At $4 an hour, it took 625 hours to buy the truck. Today’s model costs $30,000, and the average hourly wage is $26. So the wage earner has to work for 1,154 hours to get a standard F-150. Put another way, he has to sell almost twice as much of his time to get a set of wheels.
But it is not only the F-150 owner who has lost the value of his dearest commodity - time: You can do the same calculation for housing. An average man paid about $24,000 for the average house in 1971. Today, he pays $371,000. Priced in time, the house cost 6,000 hours in 1971 and 14,269 hours today… It takes more than seven years of work for the average guy to buy the average house today - four years more than it took in 1971."
Is it coincidence that Mr. Bonner selects the year 1971 to draw a contrast? It is no coincidence in the least.
The Fiat Dollar and Globalization: In August 1971, old Nixon slammed shut the gold window... and the gold standard was no more. The gold standard, a shell in its dying days, nonetheless kept the balance of trade in a range. A nation running a persistent trade deficit risked depleting its gold stocks. The unbacked dollar, the ersatz dollar, removed all checks. America no longer had to produce in exchange for goods… or fear for its gold.
“By the sweat of your brow you will eat,” Genesis instructs us. But under the new dollar standard America could eat by the sweat of others’ brows — without perspiring a bead of its own. Scraps of paper, rolling off an over-labored and groaning printing press, were its primary production.
Ream upon ream went abroad in exchange for goods - real goods. The international division of labor was suddenly opened to hundreds of millions, particularly peasants from the labor-rich fields of China. They entered the factories in their millions, each toiling for one dollar per day. Perhaps two. The competition depressed average American wages - wages that have never recovered. Meantime, the past decade has only deepened existing trends…
The Sparrows Go Hungry: The trickle-down theory of economic progress argues you must first feed the horses in order to feed the sparrows. It contains much justice - poor men do not open businesses. They do not furnish employment to others. They do not put bread in mouths. But because of the massive distortions in today’s economy, the sparrows have largely starved.
Meantime, the Federal Reserve’s false fireworks have pushed the stock market to record heights - even with the recent blood and thunder trade war drama. The artificially inflated market has put the asset-owning classes in easy waters. As our own Charles Hugh Smith reports, those earning $1 million or more have captured 63% of all capital gains. But the Main Street economy has rubbed along at a lilting 2.1% annual pace. Is there a way out of the maze? Yes, argue the technologists...
The Promise of Technology: They insist automation, robotics and artificial intelligence (AI) will soon catapult the economic system into vastly more productive realms. By 2030 alone, they believe it could yield an additional $16 trillion to global GDP. They further claim 40–50% of human occupations will be subject to automation over the next 15–20 years. These occupations are not limited to trucking, taxi driving or manufacturing and construction. To these we must add white-collared jobs in law, finance, medicine, accounting, etc.
What will become of the attorney at law, we wonder - and the human conductor of the ambulance he chases? We are unconvinced automation will proceed at the projected gallop its drummers claim. But suspend all assumption for the moment. And drive on to the inevitable question: What happens when robots acquire the brains to perform nearly all human labor?
Creative Destruction: Economist Joseph Schumpeter (1883–1950) drove “creative destruction” into general circulation. For Schumpeter, capitalism was the “perennial gale” of creative destruction. Capitalism blows away the old and inefficient. It brings in the new and improved. Because of capitalism’s perennial gale, today’s serf lives more royally than yesteryear’s king.
Explains economist Richard Rahn of the Cato Institute: "The average low-income American, who makes $25,000 per year, lives in a home that has air conditioning, a color TV and a dishwasher, owns an automobile and eats more calories than he should from an immense variety of food…
Louis XIV lived in constant fear of dying from smallpox and many other diseases that are now cured quickly by antibiotics. His palace at Versailles had 700 rooms but no bathrooms (hence he rarely bathed), and no central heating or air conditioning."
There you have it. Here is progress itself. All because capitalism’s creative gales flattened everything in sight. The obvious benefits of capitalism are why most focus on the “creative” side of the ledger. But what about the equally critical “destruction” side?
The Destructive Side of Capitalism: Innovation and technology have always allowed humans to mine fresh sources of productive employment. The 19th-century farmer became the 20th-century factory worker… became the 21st-century computer programmer. But an omnipotent robot would likely lead the human laborer to the end of the chapter.
A robotic brute that can drive home a rivet is one thing. But a genius robot that could do anything a human can do - yet better - is another entirely. This robot would tower above the human as the human towers above the beasts of the field. An Aristotle, a da Vinci, an Einstein wouldn’t rise to its hip.
What human ability would lie beyond this unnatural beast? Artistic expression? A 900-IQ robot might run its circles around the human antique, you say. But it could not appreciate beauty - much less express it. The robot is all brains… but no soul. No, the kingdom of the arts belongs to man alone. Well, please introduce yourself to Aiva…
Will the Next Mozart Be a Computer? Aiva is a computerized composer. Programmers battered its ears with the music of Bach, Beethoven, Mozart and other colossi of the classical canon. Avia learned, and taught itself to compose original music. Its music is indistinguishable from a carbon-based professional’s. Its melodies have been featured in cinematic soundtracks, advertisements and computer games. Will the next Mozart be a computer?
Not even the oldest profession is safe from robotic invasion - but let it pass for now. There are the jobs displaced, yes. But what about the general community? Schumpeter’s creatively destructive gales tear apart the social fabric …
Winners and Losers: Capitalism puts out its tongue at tradition. It uproots communities. It swings the human being around hairpin turns of social and technological change… like a dizzied fly upon a wheel. Within a generation, the centuries-old farming community is given over to the assembly line and the punch clock. A generation later the factory goes dark as creative destruction blows the jobs clear to China… or Vietnam… or wherever labor is cheapest.
Americans must constantly rip up themselves and their families to follow the jobs — they can sink no roots into the local topsoil. Meantime, advancing technology makes today’s job obsolete tomorrow. Not everyone can take up new lines. Many are simply left behind, broken… and can never catch up.
Capitalism, Progress, Must Advance: Please, do not throw a false label upon us. We are heart and soul for capitalism - authentic capitalism, that is. But today’s capitalism is but a faint reflex. The central banks have sucked the life from it. But the river of progress carries forward, as it must. And yes, it must.
Do you reject progress? Then you must believe the man who tamed fire should himself burn eternally damned. That the inventor of the wheel you must set down as a colossal villain... That Ford should have been flattened by an auto. That Franklin fried in an electric chair. And that Salk should sulk in timeless grief for scotching polio. If this is your case, please drive on. We disagree... with the highest respect.
But let us recognize the advancing river of progress sometimes takes the human note with it. And not all change is progress. Within the cold and lifeless economic data, behind the dense forests of statistics, exist living human beings with beating hearts. And many with broken hearts.
To these, our fellow Americans… We lift a toast of acknowledgment on this Labor Day weekend…"