So how do you make money doing this? One, monetize a website showing this video... package kit so others can do it too. Absolutely amazing work...
Saturday, October 16, 2010
The Other Side of the Trade
Weak dollar = good for USA exporters and foreign consumers, bad for USA consumers.
Notice in a dollar policy, there are two sides to the trade:
Strong dollar = cheap imports into USA, good for USA consumers, bad for USA exporters.
Either policy, there are two sides to the trade, within the USA.
Now, the other side of the trade, from the Chinese point of view:
Strong yuan = cheap imports into China, good for Chinese consumers
Weak yuan = good for Chinese exporters and foreign consumers
So a weak yuan is good for USA consumers. A strong yuan is bad for USA consumers.
So a weak yuan is bad for USA exporters. A strong yuan is good for USA exporters.
So a weak yuan is bad for Chinese consumers. A strong yuan is good for Chinese consumers
So a weak yuan is good for Chinese exporters. A strong yuan is bad for Chinese exporters.
If you are thoroughly confused, don't feel bad. Almost everyone is. The point to apprehend is whatever the policy is, there is the other side of the trade. Any policy they pursue, one side wins, one side loses. Within the USA, whatever the policy, one side loses, one side wins. Between USA and China, one side wins and one side loses. So if a politician says, "blah blah blah policy is good for America," really he means only a certain group of Americans benefit, he ones who are paying him for the policy. The other side loses.
Now there is no such thing as a strong or weak dollar in a free market, these terms only make sense in regimes where the currency is manipulated by govt fiat.
The policy of the USA is to promote exports, since the idea is that builds national wealth. It does not, more than any other economic activity, but here is how it works: USA heavily subsidizes our top three exports (in dollar value): agriculture, machinery and petrochemicals (oil). (Yes, oil.) We taxpayers pay money out of our pockets to get the price low enough for these items to sell on the international market. The huge companies exporting these goods launder the profits overseas and avoid paying USA corporate taxes, and enough is recycled back to USA to pay off the politicians who vote for the subsidies that get the ball rolling in the first place. Archer Daniels Midland is "supermarket to the world" because none other gets such fantastic subsidies. So, in exporting from USA, one side of the trade is Archer Daniels Midland, supported by the taxpayer bailout of every transaction the company makes, and the Chinese buyers on the other side.
This policy takes money from a wide group of people and super-enriches a tiny group of people. Big biz and big govt work together to this end.
If the Chinese do not inflate their currency quick enough to make Archer Daniels Midland prices, especially at the heavily subsidized rate, competitive worldwide, then the flow of funds to launder overseas and support USA politicians is interrupted. We cannot have that. So the people on the other side of the deal are condemned.
Today USA Govt policy is to get the Chinese to make the yuan stronger. The other side of the trade is it would make the dollar weaker. This policy is bad for most USA citizens. It might be good for some.
Check out the graph in the above link. There is a problem with a graph Output Vs Jobs: it is a dollar total representation, and does not break down content. Sure takes a lot less USA labor to make a Cadillac today than in 1972, that is now that 50% of the content is plug and play parts made overseas. The chart would reflect a $50,000 cadillac, of which $25,000 was made overseas (or some such.) So we don't really have $50,000 added to the USA economy, if $25 of that $50 actually went overseas.
And sure, the results are we get more money for less labor, but it misses another point. Now that the labor is free of constructing cadillacs, in a free market they would have moved on to higher level maglev transport, or some other innovation. Because we manipulate currencies, and because we elect 3rd and 4th stringers to office as opposed to the communist party who can field first stringers everytime, we are stupidly fighting wars we have already lost and bailing out companies that have already failed.
As someone who has been import/export for the last 35 years, let me tell you, the game is two part: one avoid pointless USA regulation by moving production overseas; two, launder profits overseas to avoid USA pointless tax collection. When you want those jobs to return, roll back taxes and regulations to the last year you were happy with USA production. 1990? 1980? 1970? 1960?
Thursday, October 14, 2010
Thin Ice
Gary North has an excellent summary of the situation we are in over at LRC...
Governments in the USA have hit the brick wall of taxation. The Federal government is using massive debt to get around this brick wall. This can go on for a time, but its end is sure. Herb Stein was right.
There will be great political battles ahead over whose oxen will be gored by the tax revolt. Oldsters will probably be the last to have their budgets cut. But it is sure that this will happen – not just in the United States, but all over the world. He who drops out of the labor force will live to regret it.
When he says anyone extending credit to the government is skating on thin ice, he also means if the govt owes you medicare or social security (in essence you have extended credit to the feds...) you are in trouble in the measure you depend on it.
The feds will default, piecemeal and in ways, you will feel, but they can get away with. Another important point in the article: govts run up debt and default because lenders keep coming back.
USA Imports AND Exports Both Up for August 2010
The new census report for international trade is out, and the trade deficit widened, but both import and exports are up. There is a montain of info in the report, which is no cost to browse.
Wednesday, October 13, 2010
They Hate Our Freedoms
Although that was the reason we were given for 9/11, the CIA, Osama Bin Laden, the 9/11 commission, and various other government agencies among themselves made clear 9/11 was a counterattack. Read the whole thing, especially page 40, but read the whole thing to see how our government believes managing the message better will result in better military gains. ugh!
Here are some polling numbers from the report:
Data from Zogby International
in July 2004, for example, show that the U.S. is viewed unfavorably by overwhelming
majorities in Egypt (98 percent), Saudi Arabia (94 percent), Morocco (88 percent), and
Jordan (78 percent). The war has increased mistrust of America in Europe, weakened
support for the war on terrorism, and undermined U.S. credibility worldwide. Media
commentary is consistent with polling data. In a State Department (INR) survey of
editorials and op-eds in 72 countries, 82.5 % of commentaries were negative, 17.5%
positive.3
I doubt the Nazis had such bad polling numbers in countries they occupied.
One problem is the blockheads here who worry on air about sharia law coming to USA, or how Islam fosters violence. These attacks are about USA occupation and attacks on Muslims. As Glenn Greenwald notes 9 years after 9/11, USA is still carrying out revenge of the attack on USA.
Ugh... it is up to us to stop the cycle of violence.
Pipelineistan
What lovely country, gentle rolling hills which change colors, even lighting, with the seasons. Like the great pacific northwest in USA, natural predators are few, and like California, topography and climate offer wonderful conditions for farming and light industry. But there is much more; just as new Zealand seems to replicate the climate and topography of the benefits of the west coat of USA, or say Chile, so do these lands.
Due to bad government these lands and the people have suffered grievously, but now freedom is eking in, and the benefits are growing. Lucky too that they lie between fantastic oil riches and China, a fantastic market. These lands one writer is calling pipelineistan, since these Central Asian Republics are enjoying prosperity like Alaska as the pipeline was built. Will stability, tourism and development be far behind?
These countries are wonderful lands, just as USA is today. But USA can as easily end up suffering centuries of distress, in spite of the beauty of our lands, for exactly the same reason these lands did. These people consider China a great benefactor, since they actually buy oil and pay for pipelines. These people see what USA is doing in Iraq and Afghanistan and want no part of it. Time to declare victory, come home, and let our business people bring prosperity behind the peace.
Monday, October 11, 2010
Why We Get Marine Insurance
This happens...
and this...
and this...
because sometimes we don't think it through...
sometimes it is just bad luck...
Because we are around water, we need marine insurance.
Review of Initial Contact
Hi John
I took your class a number of years ago. I was wondering if I still can get some of your clear advice. My wife has come up with an idea for a reasonably simple electronic "aid" for golfers. How do we go about getting a prototype made to show to retailers to see if there is a market for the product? Confidentiality agreements??? I know that you have opinions on these...
Thank you.
Michael
Hey Michael,
Yes indeedy... NDAs kill opportunity...
First try to buy your idea at the very upscale golf shops you think would have it, and if and when they say "good idea, it does not exist...." then you take the names of those stores to the best maker of such items in the world, and leverage the buyers interest into a set of prototypes...
If and when you have prototypes, you return to store and if they like, ask for best rep...
There is of course more, but does this remind you enough? Feel free to ask more questions...
Sunday, October 10, 2010
Mistake Causes Spending Parties
Someone made a keyboard error and a rather mundane house was valued in a small town at $400 million. City planners anticipated more $8 million more in taxes. So naturally, they spent it. Why not?
Is this not how government works. Turns out the house is worth $110,000, so actual taxes to be paid, a few grand. Nonetheless, everyone on the govt side spends the money before it is realized, with no one checking where the "new money" was coming from. Party on, Garth. Take as much as you can get, regardless of the source, and spend like crazy! This is why our govts are in trouble.
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