Sunday, 31 July 2011

Dynamics: Escapism and sanctuaries

1) From the years:



2) From the tears:



3) Vlog: Sanctuaries (for people, organisations, etc)

Living with Uncertainty - the Lords of Chaos!

Those who feel at home in chaos are equipped for success and happiness at least in this era, probably all eras!

a) Stability is not the way of Nature, only a human thing
b) I propose it is selectively valued/defined eg by financiers





What were are seeing nowadays is the inability of a system based on a certain religion (see Max Weber and The Protestant Ethic and the Spirit of Capitalism in Wikipedia) deal with globalisation and other systemics and dynamics of the era. This system's inability to be adopted or approved by the world, even parts of Europe - the EU.

The power of the mind

The power of the mind, use your mind!

Saturday, 30 July 2011

Prisoners of our Mindsets

We are Prisoners of our Mindsets, especially in this era of complex systemics and volatile dynamics. Can we think outside "the box" or at least go around it, instead of closing ourselves in it so it feels like those "safe rooms" in NYC?

Saturday night anyone?

These days of austerity in the "western" - OECD world, it feels that Saturdays have become "Friday bis" and that Sundays have become pre-Mondays!

How about Saturday nights?

Here's a song about Saturday nights (the good ole ones):

Mind......?

mindboggling or mindblogging?

Suffering for ....

Suffering for a living?

Thursday, 28 July 2011

One of the key mistakes of the EU's periphery has been

One of the strategic mistakes of the EU's/Eurozone's periphery was/is not pushing the 27 and the EU institutions for a friendlier EU Single Market to SMEs in the last 18.5 years!

Yes, my assumptions/hypothesis is that a better working Single Market would habe benefited all 27, but Greece, Italy, Spain, Portugal and Ireland more than the others!

The Rhythm of your World, Just-in-Time

The Rhythm of your world, Just-in-Time

The rhythm of your world
The rhythm of your life
The rhythm of your work
Just-in-Time

Economy
Society
The World
Your Life
Just-in-Time

July 28, 2011

The song version:




Monday, 25 July 2011

Free Trade This!

More troubles with Doha and the USA's bilateral deals with South Korea, Panama and Chile report the New York Times: "The Wrong Way to Free Trade"

For more background, you can check out 31 (!) posts in npthinking labelled "WTO" over the last 5 years.

And since we are on the topic of WTO "free trade", here's a relevant song: "Free Trade This" (nickppopart is an npthinking sub-brand):

Where are the Agoras? (poem)

Where are the ‘agoras’?

The markets of dreams
The dreams of markets
The agoras of ideas
The ideas of agoras

Expired ideologies
Antiquated chronologies
Time is linnear
History is not cyclical

Modernisation
Progress
Evolution
Constitution

Show me the way to the next free agora!
Said the thirsty traveller
There is no such thing as a free lunch!
How about dinner?

Breakfast at Jennifer’s
Lunch at Laura’s
Dinner at Deborah’s
Sleeping under the stars

Where are the agoras?
Property of the mind
King of the market
Queen of the mind

Dynamics: Oxymoron? The competitive advantage of being "lazy"

To get more crucial tasks done and better, slow down!
An oxymoron?

Reality is all in the mind
Another oxymoron?

So people are making virtual money in the real world and real money in the virtual world - hm, wow, makes one think!!!
Another oxymoron?


IMO the meaning of life isn't to realise a "potential" but to be happy; trying to realise one's potential leads to stress, not happiness more often than not!

The "laziness" philosophy I present below does not cover only work but many other aspects of life as well:

work, skills ,ability, success, "I deserve", "earn": These are some of many concepts that IMO need redefinition nowadays!

For example, ability is a term and concept that needs re-defining in our epoch and its zany job markets!


The competitive advantage of being lazy:

a) manual work - effort does not constitute work in our era
c) the pace of work and life in this era is not fit for humans, thus
c) never send a human to do work suitable for a machine, robot or animal
d) productivity as defined in the industrial age is irrelevant in our era


Ponder on this:
"I do not #want what I cannot have", she said
"Can she be that disciplined", I thought


And this:

Not having goals is a goal too!


Success: Improve yourself or lower your expectations? Hm, food for thought!

Lastly (for now):
IMO, we need to make change a daily habit - not easy, but crucial these uber volatile days we live in!

Sunday, 24 July 2011

Downgraded to Junk

One World, the People

"One World, the People"

One World
One Planet
One Sun
One Tribe

Two choices
Night and Day
Winter and Summer
Heat and Cold
North and South
East and West
Risk and Return

Three options
Move forward, stay put, receed
Multilateral, zonal or bilateral
-1, 0, +1
Trilogies, Part I, II, III
Blood, sweat, tears
Love, hate, tolerance
Rings, bubbles, squares

Four dimensions
Spring, Summer, Autumn, Winter
North, South, East, West
x, y, z and time
Time to heal,
time to feel,
time to think
time to rationalise

A world of choices
A world of people
A world of nations
A world of trade
A world of love
A world of passion
A world of compassion

One world, the People

Saturday, 23 July 2011

Emerging EUropean dynamics

After last Thursday's European Council meeting, I have been asked by friends on Twitter and in real life, what my views or conclusions are. My reply is that I am waiting for the dust to settle first, before I draw any conclusions.

But in any case, I am brushing up my French and planning to study more German. Propose the same. These two languages emerge as lingua francas in Eurozone & probably political union.

Now what I can see, in general, is (these are my points in a discussion with a fellow tweeter):

Plus I can see continental European cities, especially central EUropean ones emerging as clusters replacing may of the clusters currently based in London. Over time of course.

The UK and London have been self-marginalising for decades now, esp after 2008 and 2010. And with Labour now trying to make up its mind whther it is pro or anti-immigration, the situation is getting bleaker. Which is a great pity for any original Anglophile and Philo-European. Alas, UK is starting to remind of UK in "Children of Men" film. I can see a "fortress UK" emerging.

These are not predictions, only dynamics that I see.

I also see potentially a new role for NL (The Netherlands)( provided that it shakes off the xenophobic dynamics of recent years. Was a very open and melting pot country until early 00s and can become again. Could evolve into (almost) an English speaking country – hub in continental Europe. With great strategic benefits.

Also see opportunities for Austria, Hungary & Czech R. if they accept EU-melting pot clusters role. Until they do, they are missing good opportunities.

One should see the Eurozone or the Europlus as a corporate conglomerate and devise a competitiveness strategy for each member but also as a whole. It is possible to devise such a comprehensive strategy that is not one size fits all. Corporate conglomerates do.

Will also be interesting to see more French & German multinationals evolving into Euro-multinationals.

What will make the EU's periphery competitive in the Eurozone, the EU Single Market and world markets?


Continued from: Time to rethink global trade (and save the Euro & the US economy as well as Earth)?

Many things have happened in recent days.

Yet the core issue remains:

What will make the EU's periphery competitive in the Eurozone, the EU Single Market and world markets?

And to widen the strategic question: What will make the Eurozone and the EU competitive in world markets?

Much of global trade, in spite of the fact that economies are more and more Services economies (ie the % of Services (vs industry and agriculture) in the GDP increases in recent decades), is in manufactured goods. So while the manufacturing base of most countries/economies is narrowing it is that same "niche" of the economy that economies/countries rely on for the largest part of their exports. Yes, there are internationally traded or tradable Services (as well as intangible/intellectual products), such as tourism plus banking, insurance and other services of financial genre, telecoms, but can services such as haircuts, restaurants, medical services, etc, become part of a country's exports?

Well, there are people who travel to California 1-2 times a year from Europe to get and thus technically "import" cosmetic surgery. People do travel to Asia or other countries, often funded by their own country's national health service, to receive (and thus "import") medical services (various types of operations). And a lot more services as well as intellectual products can be made into exports using online technology as well as (and more importantly) entrepreneurial creativity.

The main growth oriented idea behind the programmes that the IMF and the rest of the Troika as well as national government are implementing for Greece as well as Ireland and Portugal is to create a "devaluation" effect (called internal devaluation) without actually devaluing (since they have no currency of their own to devalue).

The idea behind devaluations is to make a country's "native" products and services (eg tourism) cheaper to foreign consumers (b2c and b2b) while making imports more expensive to "native" consumers (both b2b and b2c).

Germany's competitiveness is allegedly mostly based on the quality (and thus uniqueness) of the "complex" (as opposed to "simple") manufacturing goods it produces, to a large extent by allegedly sophisticated SMEs. Goods that people and companies are willing to buy (import) even at high prices (especially when Euro is above 1.3, 1.4 USD or even higher). Or as traditional Economics calls them, goods with demand that is inelastic to price.

But which are these types of goods (and services) that people or companies are willing to buy even when the economic climate is bad? They must have a very high utility value that makes them appealing at almost any price, ie a (very) high value to price ratio! They also have to be pretty unique, in that they are only produced by a certain country ie not replaceable by goods from another country.

Another strategy option is to be the cheapest (product/good) in the world.

In the middle, there is a strategy that tries to combine some uniqueness or value/price with some price competitiveness. Must be a huge area of the "map" of world products and services, a "crowd" where each product is trying to find its "vital" market space.

One other key factor is consistency, which is the original definition of quality. All product units have to be the same, identical, no deviations from the product characteristics. Needs reliable tools (that is why reliable tools/machinery tends to be one of the complex types of products that allegedly Germany produces and exports). Same applies to apples, oranges, even haircuts. There is no room for bad apples, literally and metaphorically, in the package or crate. If they come out of the productuve process, then they must be left out of the goods to be sold, counted off as waste or at beast sold as generic or used for some different purpose (eg make "marmalade").

Which leads to the same concept at work. Who wants workers of any kind (general staff or top execs, etc) who are brilliant one day but have off days? Even in sports that is less and less tolerated, by the systemics. A music band? Even a lover! In these types of systemics, things get very demanding and complicated. That is one reason machinery has been replacing humans for decades, and in some cases, centuries now. In other cases, humans were replaced by animals (or treated as such).

Another key factor, maybe the most overlooked one, is access. You may have the best and cheapest (!) product in the world, but unless the large wholesale and retail conglomerates are willing to take your product (in which case you may also need to produce very large quantities of it) and put at the shelves of the supermarkets of this world, then your options for reaching a market are fewer, albeit more than they used to be before the internet and e-commerce (and even E-Bay) era.

Complicated huh? Much more complicated that the simple "productivity" and "unit labor cost" concepts that lots of economic analyses and plans seem to rely on.

Which brings us to the question: How cheap must Greek, Portuguese, Irish etc labour cost (and and how salaries) become, via austerity and internal devaluation, for the Greek, Portuguese, Irish economies to be competitive? Competitive vis-a-vis whom? The other Eurozone ones? The other EU ones? The other WTO ones? To the Chinese?

To be continued ....

Thursday, 21 July 2011

Economic/political dogmae and economic agnosticism!

Many believe in the economic/political dogma that the state knows best.
Many believe that in the economic/political the markets know best.
Are there any "agnostics" left?

Tuesday, 19 July 2011

Time to rethink global trade (and save the Euro & the US economy as well as Earth)?

Whereas more and more ("national") economies are becoming Services economies (ie with Services yielding 65-70% or even more of GDP) most of international trade is still in manufactured goods. So whereas "intellectual products" such as film, TV content, music, even porno (by the way, its main global "manufacturing" cluster is in California too, much like the Silicon Valley and Hollywood) and Services such as finance, telecoms, insurance, and of course tourism, provide valuable export revenue to some economies, the world superpowers of exports are driven by manufactured goods!

Be it "complex products", for consumer or business use, as is the purported German key to exporting success, or innovative tech products (America's niche) or low price - low quality manufactured goods (as is the case for China, at least for now, will it follow Japan's example and upgrade, gradually, into quality products?), manufactured goods are the bread and butter of trade. Portugal, Spain, Greece, Italy and others are being advised to adopt the German approach to manufacturing quality/complex goods as a way of solving their competitiveness and balance of payments issues!

Side Note: But, as I have asked in previous posts (see eg here), what would happen to the world market prices for complex goods if the PIIGS and other Eurozone members decide to follow Germany's example (thus increasing supply of such goods in the Eurozone, the EU and globally)?
So, manufactured goods of all origins, sizes, qualities, prices, etc are travelling around our planet everyday in the process of what we call global or world trade, the No. 1 world sport of our era, more crucial than football (aka soccer), basketball, even rugby or cricket! The one that makes or breaks economies as we are seeing in recent months (hence a "Rollerball" of sorts, if you recall the movie, especially the original, starring James Caan).

But does all this trade (and transport) "jazz" make sense? In addition to burdening the planet's environment?

Some would say that it is transport that has become too cheap in recent decades, thus allowing for "irrational" transport and trade to occur, in the name of Ricardo (David (see Wikipedia) not Ricky). But cheap transport is not necessarily the problem, is it, unless of course one believes that markets and the prices they set provide the best allocation of resources, but I am not a believer in that worldview. Are you?

So should there be a central planning body, global, that determines which manufactured products should have a "right" to be transported across the "7 seas" (via air, sea, etc or comb0 thereof) ie a right to burden the planet's eco-system (eco not econ; well that one too, actually)? Does one have to believe in global warming to agree that shipping of many types of goods across thousands of miles/kms or nautical miles is simply irrational use of resources?

No, I am not proposing the establishment of such a central trade/transport licensing body. Of course not. Unless China takes over the whole world, of course. In which case it won't matter what I or you think, anyway!

A few years ago, a few well known leaders, 2 from South America and 2 from Europe, if memory serves me right, had the brilliant idea to strap a "globalisation levy" on (believe it or not) passenger air transport!!! The European Commission's Services were even forced to look into it. Why on earth charge the movement of people instead of goods? To promote tele-conferencing? Or virtual sales aka e-commerce? To bring the travelling salesmen a break (see the movie Up In the Air with George Clooney as an excellent case study)? Not likely!

But the problem still exists and calls for a solution.

End of Part 1
(Not to be completed over 6 seasons)



Thursday, 14 July 2011

In view of 2.7% stable Eurozone inflation, was the ECB rate hike needed after all?

According to the Eurostat:

June 2011 Eurozone annual inflation stable at 2.7% (ie same as in May).

In the EU (27( it is down to 3.1%

Was the ECB new rate hike from 1.25% to 1.5% needed last Thursday then?

Why?

Note: Maybe the May industrial producer prices? See my "What is driving Eurozone prices up?" post July 7.

2.5% intra-EU migration, only 4% non-EU immigrants in the EU!

According to the Eurostat, "Foreign citizens made up 6.5% of the EU27
population in 2010 Foreign-born people accounted for 9.4% of the EU27 population"


But I do no see why the Eurostat's press release headline merged the number of intra-EU and non-EU "immigrants.

Out of the total 6,5% of the 500 million EU27 population, the 6.5% includes two parts:

a) 2.5% of inta-EU27 "immigrants"

b) 4.0% immigrants from the rest of the world (ie non-EU)

The 4% figure is lower than some would imagine and puts a dent in the complaints re "foreigners" in the EU!

It would be interesting to know how the 2.5% internal migration of the EU27 population (citizens) in 2010 compare with the intra-USA one!

Which interests will prevail in EU trade policy?

A key strategic question is whether Germany still relies on Euro & EU markets for its exports or can rely on China et al.


Different exporters in Germany and the rest of the Eurozone17 have different geo-strategic trade interests: Some prefer the Eurozone, some the opportunities in China et al, etc!


For a large % of Eurozone export & other firms, a EU exit from the WTO would be a blessing (inter alia, it would curb Chinese exports to the EU and its Eurozone that compete with many made in Eurozone products) . For many, a curse. 


Of course, in that scenario, EU trade would be conducted on the basis of existing or new bilateral agreements of the EU with countries (China, USA, India) or groups (eg Mercosur, ASEAN etc)


Which interests will prevail in EU trade as well as other policies (eg the implicit exchange rate policy of the Euro)?

Tuesday, 12 July 2011

Does the surprise June drop in UK CPI from 4.5 to 4.2% validate ...

Does the surprise June drop in UK CPI from 4.5 to 4.2% validate Bank of England's decision last Thursday not to raise its rates?

Compare that with ECB philosophy/decisions!!!

From "buy local" to "hire natives" to "invest at home (not abroad)"

Many of EU & world problems stem from systemic imbalances due to uneven freedoms for capital vs services, people/labour even goods.

It seems some policy makers et al in some EU members think that the Chinese market is more attractive than EU Single Market. A grave strategic mistake!

The China imports slowdown is bad news for those EUropeans who think exports to China can replace Eurozone & rest of EU Single Market ones.

Note that German's exports have rebounded in June after a bad month in April and a record month in March (should one try to correlate them with the exchange rate of the Euro?).

The inflation curbing policy (or obsession) of the ECB that has led to an expensive Euro for much of the 11.5 years since the introduction of the coins and notes, makes exporting to Eurozone easy. Exporting from Eurozone is the Herculian task!

In other words, the Euro exchange rate has been eroding most if not all Eurozone economies for most of the Euro years. Even Germany's. In a way, the bailouts of the GIPs are the price the Eurozone/EU is paying for the ECB/Bundesbank perennial obsession against inflation that hurts Eurozone biz, exports and tourism (especially Portugal, Spain, Italy, Greece).

Are there socio--economic & poitical forces in Germany that have had enough of the uber hard DM/Euro obsession of Bundesbank/ECB? One would hope so, beceause then there is hope for a less destructive Euro exchange rate policy (that could also require a change in the mandate or powers of the ECB (almost typed: Bundesbank).

Otherwise, a key strategic option is the activation of an "Economic Fortress EU" that ought to include:

a) Exit from the WTO and reliance of specific case-by-case agreements of the EU with other countries (eg USA, Canada, India, China, etc) or groupings thereof (eg ASEAN, Mercosur or UNASUR, ACP, etc). Those could include agreement not only on trade of goods, but also services, intellectual products (and protection of intellectual property (see ACTA and the Singapore WTO agenda), economic migration, and of course capita movement/relocation).

b) Upgrading of the 4 freedoms inside in EU Single Market.

Will come back on both (a) and (b) in future posts.

My point is: capital, goods. services, labour & people should enjoy same level of freedoms at global or regional scope. The latter is more feasible

Another point is that the EU Single Market has to offer members benefits non-EU countries/economies should not have, ie more value.

Humanity has moved from city states to nation-state and now moving to region/continental-states. Like empires, globalisation is too unstable. Regionalisation will inter alia be good for the environment

Direct globalisation has failed. There's no global free movement of services & labor even goods. Why not build walls 4 capital then? Only route is via phase of regionalisation (NAFTA, EU, UNASUR, ASEAN, etc) with some links (capital, trade, services, labour/people) between regions

From "buy local" to "prefer to hire natives" only short step to "invest at home (not abroad)". That is not the solution. The solutions are at regional/continent level. And maybe someday, the global one.


Monday, 11 July 2011

Let's not make the Maastricht mistake again

Some are now saying that fiscal union is the solution.

Let's not make the Maastricht mistake again.

Euro, fiscal union, even Single Market need EU political union. Inevitably. Sine qua son.

On speculation

Speculation has gone from provider of liquidity to catalyst of instability.

Time it's usefulness is revisited.

Sunday, 10 July 2011

Global dynamics: The "our taxpayers" gimmick

This "our taxpayers" public argumentation - gimmick is irksome, narrow focused and unfair, to say the least.

Funny how selective (aka inconsistent in its claims) the "care" about "our taxpayers" is!

Has "taxpayers nationalism" then become the new gimmick?

Thursday, 7 July 2011

What is driving Eurozone prices up?

What is driving Eurozone inflation up?

a) Global energy & food prices
or
b) a deficient EU Single Market for goods, services and jobs?

Here's a hint:

UK (11.9%), NL (10.7%) and Belgium (9.7%), continued in May 2011 to lead the EU in the hike of industrial producer prices (when compared to May 2010 prices) along with Bulgaria (10%) and now Denmark (10.8%), Lithuania (9.9%) and Latvia (9.7%)

France (6.1%) and Germany (6.0%) seem to be in somewhat of a convergence - cohesion as one would expect even in domestic market, since a domestic market of an EU member state is open to competing products from other EU member states (not to mention China, et al).

Due to proximity and the resulting alleged close economic links, one would expect at least NL, Belgium (partners in the Eurozone17 with Germany) and maybe Denmark (outside the Eurozone but Northerly neighbour of to Germany) to have similar figures to Germany. Yet, they do not!

What does this indicate?

See also my previous posts:

What does one get when one tries to balance Bundesbank logic and Logic?

That's what one gets when one tries to balance Bundesbank logic and Logic:

Today's ECB decisions! See my previous post

Does the Eurozone need a new (!!) central bank?

"With the unemployment rate above 9%, Fed officials are reluctant to boost its target for short-term rates" reports the WSJ.com in "ECB's Trichet Extends A Hand to Portugal", July 7, 2011.

Today, while the Bank of England kept its rate unchanged, in spite of inflationary pressures (yet very low growth) plus a very high (No. 1 in the EU) May 2011 (compared to May 2010) industrial producers prices hike, the European Central Bank raises its basis rate for a second time in 3 months. from 1.25% to 1.5%.

It seems that the Eurozone urgently needs a different central bank!!! One eg that, lie the Fed, cares about employment as much as it cares about inflation. The ECB seems too "dependent" on Bundesbank's preoccupation (or should one call it obsession) with inflation.

Note: While the Fed & the Bank of England have kept their recession rates of 0%-0.25% & 0.5% the ECB has raised its rate frm 1% to 1.5% in 3 mo

World Dynamics: Mind the B Scenario!

Those who are banking on China (now a communist capitalist system) becoming a democracy via its economic dominance should also mind scenario B: EU & US become communist instead.

As for the EU, forcing EU (Eurozone) member states to rely on Chinese investment is critical undermining of the future of Europe not only the EU/Eurozone. Europe solve your problems (yet today's ECB decisions do not look promising to that end).
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