This Pope On Politics and Economy - What To Do

Right wing and anarcho-capitalist (internal contradiction) Catholics are criticizing this Pope for most of what he says on economics.  It is unseemly, like the demons who screamed in fear as Jesus approached.

“Our world economic system can’t take it anymore,” says the Bishop of Rome in an interview with La Vanguardia. “I’m no illumined one. I didn’t bring any personal projects under my arm.” “We are throwing away an entire generation to maintain a system that isn’t good,” he opines with respect to unemployed youth.

Yes, capitalism is over, done with, like the Soviet system, and yes, we have thrown away two generations of entrepreneurs.  The people who depend on new business to have their sinecures funded, social security, pensions, etc, have denied the formation of the economy that might have funded the promises made.  Sort of condign punishment coming, slow motion.

As opposed to the Pope, I have a plan, a personal project.  As I survey the working parts of the economy, the imbalance between small and big business is a clear manifestation of the damage done by the federal "get big or get out" mandate.  Small business needs to be promoted, but this cannot be a Government project, for the Government has already done to small business what it has done to the American Indian and "health care."  Although I am not going to worry about that, I do advise we collective elect to end all that.

For my part, my classes have always been focussed on start-up and small business.  Over the last 30 years what I have seen is the atrophy of the innate sense to trade small and grow, and the learned skill of selling.  So my curriculum is beginning to emphasize these two points:

1. The MOQ FOB - it has always been in my curriculum, but what was once a reality noted is now an imperative to be restored, a lack to be addressed.

2. Trade Show Booth Management - the trade show is the World Cup of the business.  The booth is the match.  The business activity is directed to the upcoming show, and capitalizing on lessons learned from the last show afterwards.  There is so much to this, it is often farmed out to experts at the small business level. But to farm it out, to farm anything out, you must be a good consumer of that which you wish to farm out.  If you know nothing about trade shows, you can hardly judge anyone who is running trade shows for you.  And people who are working for you without any standards come back from trade shows with a stack of business cards and call those "trade leads." So I am cobbling together several start-ups ready, willing and able to sell worldwide into one trade-show-booth-as-working-seminar, this one the first:  http://www.johnspiers.com/Export_Agriculture/Advanced.html

The result - supply for nascent demand, the means to discover new markets, to grow a small business.  The bad news is we are imbalanced as to small business vs large, the good news is a start-up is automatically leveraged, has exponential value since it is rare.  The payoff will come with the changes apres-deluge, when property "values" drop to zero, and taxes go to 90%.  Those were the golden days of small business last century. They are coming back.

The Pope goes on, after decrying fundamentalism (extremism), and lauds radical (roots) revolution:

 For me, the great revolution is going to the roots, recognizing them and seeing what those roots have to say to us today. There is no contradiction between [being a] revolutionary and going to the roots.

See, when your education includes vocabulary, you can communicate ideas.  We pay more for an education for each American in the USA than it cost to educate this Pope, but we get miserable results.  But back to the point, radical and revolution.  So far so good.

I know that something could happen to me, but it’s in the hands of God. I remember that in Brazil they had prepared a closed Popemobile for me, with glass, but I couldn’t greet the people and tell them that I love them from within a sardine tin

And something probably will happen to him, because such voices don't get the mic long.  And the next Pope will go back to the bullet-proof security.  The blood of martyrs, etc...

Now to his views on economics, that sends the right wing crazy:

It’s proven that with the food that is left over we could feed the people who are hungry. When you see photographs of undernourished kids in different parts of the world, you take your head in your hand, it incomprehensible. I believe that we are in a world economic system that isn’t good.  ...
The economy is moved by the ambition of having more and, paradoxically, it feeds a throwaway culture. Young people are thrown away when their natality is limited. The elderly are also discarded because they don’t serve any use anymore, they don’t produce, this passive class… In throwing away the kids and elderly, the future of a people is thrown away because the young people are going to push forcefully forward and because the elderly give us wisdom. They have the memory of that people and they have to pass it on to the young people. And now also it is in style to throw the young people away with unemployment. The rate of unemployment is very worrisome to me, which in some countries is over 50%. Someone told me that 75 million young Europeans under 25 years of age are unemployed. That is an atrocity. But we are discarding an entire generation to maintain an economic system that can’t hold up anymore, a system that to survive must make war, as the great empires have always done. But as a Third World War can’t be done, they make zonal wars. What does this mean? That they produce and sell weapons, and with this the balance sheets of the idolatrous economies, the great world economies that sacrifice man at the feet of the idol of money, obviously they are sorted. This unique thought takes away the wealth of diversity of thought and therefore the wealth of a dialogue between peoples. 

Whew!  Exactement!  Today all famine is state-sponsored, the desired result of state interventionism.  Young and old are thrown away, exactly, I've been watching the last two generations be sucked into FIRE (Finance, Investment, and Real Estate), in essence pointless rearranging of the deck chairs, and the computer "revolution" in which massive resources are martialled to keep straight who owns what chairs and where the are located, on the Titanic.  And a war based economy is exactly right: droning wedding parties to terrorize people into giving up their resources is necessary to fund USA empty pensions.  And this regime crowds out the division of labor that would emerge if we did not cheer on the human sacrifice of the war economy (thank you for your service!).

Bankrupt balance sheets, division of labor, proper definition of wealth, wow...  someone else out there thinks like I do.

Well understood globalization is a wealth. Poorly understood globalization is that which nullifies differences. It is like a sphere in which all points are equidistant from the center. A globalization that enriches is like a polyhedron, all united but each preserving its particularity, its wealth, its identity, and this isn’t given. And this does not happen.

Whoa...  spot on!  Then he is asked about independence movements -

All division worries me. There is independence by emancipation and independence by secession. The independences by emancipation, for example, are American, that they were emancipated from the European States. The independences of nations by secession is a dismemberment, sometimes it’s very obvious. Let’s think of the former Yugoslavia. Obviously, there are nations with cultures so different that couldn’t even be stuck together with glue. The Yugoslavian case is very clear, but I ask myself if it is so clear in other cases. Scotland, Padania, Catalunya. There will be cases that will be just and cases that will not be just, but the secession of a nation without an antecedent of mandatory unity, one has to take it with a lot of grains of salt and analyze it case by case. 

Exactly.  Why should Ireland fight for freedom only to return to under the British boot?  I am keen on Scottish independence, but the pro-independence people seem to have a program of "worse than English" rule.  If Scotland were to be emancipated from England, then they would have free markets and grow in peace, prosperity, wealth.  But no one is talking freedom as a part of Scottish independence.

And on participation in politics -

Maybe they talk about the same problems but with a new music, and this I like, this gives me hope because politics is one of the more elevated forms of love, of charity. Why? Because it leads to the common good, and a person who, [despite] being  able to do it, does not get involved in politics for the common good, is selfish; or that uses politics for their own good, is corrupt.

Ouch.  As an anarchist, this is challenging.  But anarchy is politics, too.  I myself refuse to participate in politics because I am one of those who would use politics for my own good.  I am no better than the criminals we have in office, except that I know better than to claim looking out for #1 is holy.  Anarchy keeps people like me out of power, and we are legion.

I wonder if the Pope is warming up to condemn interest?

Here is the Pope's dive, Mina Mazzini -


Feel free to forward this by email to three of your friends. 

Bookmark this post --- Email this post

The Mango Trade

Don checks in from the trenches...

Hi John,

This morning I had a phone conversation with the CEO of a managed farm land project in Panama.

The company sells hectares of land to buyers. The buyers take title to the land and the crops grown on the land belong to the buyer.

Company management is optional.

The major crop grown on the land is organically grown mangoes (these specific mangoes have a higher pulp to seed ratio). In addition, there are plans to do intercropping to make the land more productive for the buyer.

During our conversation I asked this question, “Is it permitted for buyers to play an active role in finding new export markets for their harvests?” His answer was, “Of course, the crops belong to the buyer. However, it needs to be done professionally. If you can do that, the company will pay a commission.”

Now I have a better appreciation of what you have illustrated previously. How opportunities present themselves out of opportunities.

Thank you for providing what you teach. Because of you, the second opportunity is possible.

I will be in contact with questions and for help.

Best regards,

Don

To which I replied, in part...

 I'd study closely what mangoes have gotten off the trees and sold through in USA from this project.  Make them prove it...  mangoes have one big drawback, no one knows how to "peel it".  

https://www.youtube.com/watch?v=lvLdPjpELyU

Finally, just as small delivery companies once delivered coffee to offices, now fresh fruit routes are being set up...  selling could be a matter of showing up at break time, dazzling with a mango "peeling" demonstration, and then an order for 10 pounds a week or whatever...

John

Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post

Tesla Open Sources Electronic Vehicle Patents

Today GM has recalled every Camaro made in the last four years, over a half million cars.  The problem is if your knee bumps the ignition, the car turns off, power loss and then who knows what.  Several injuries so far.

My first car was a 1967 Camaro rag top, red with white interior and lid.  Ran great when I bought it 1977, and sold it 3 years later.  Wish I had kept it, since it would be worth around $40,000.

That old Camaro was simple, did the trick and had heavy metal parts.  If maintained, it would run fine today. New cars have too many parts, mostly junk, so only a couple have to go and the car is toast.  My last car was a 97 STS, and the maintenance overwhelmed even profligate me.  Do you believe any of these cars today will last as long or be as valuable?

There is a reason our auto industry has failed, and is on life support: patents.  Few people realize the reason we have so few car companies is the patent pool among the big three, which they agree to open source their patents among themselves but charge an arm and leg to anyone else.  It is a club nearly impossible to join, and challenge them, and you will find yourself being DeLoreaned.

Surely, you can do specialty cars like a Shelby or a Saleen.  Specialty anything is pretty safe in USA.

Now comes Tesla, with the right tactic and attitude:

Tesla Motors was created to accelerate the advent of sustainable transport. If we clear a path to the creation of compelling electric vehicles, but then lay intellectual property landmines behind us to inhibit others, we are acting in a manner contrary to that goal. Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology.

So they will open source their patents, and invite competition, which will create commonwealth, not exceptional wealth aggregate personal power.

Also, I believe the Tesla founder has put his own money into this great project.  This hearkens back to to Ancient Greece where a wealthy person would vow to accomplish some societal benefit like build a bridge or a temple, that would benefit everyone.  The Rhetoric in Latin comes actually from the Greek and has to do with the act of declaring an intention.  Fascinating history on the implication, the law, etc around this word.

In any event, GM will continue to put out junk, kept on life support, and pay an army of lawyers to crush anyone who would "violate" their patents.  Because in the USA, the policy imperative is get big or get out, and patents are critical to this regime.

Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post

David Brat's Economics

Anthony tipped me off that goliath-slayer and college econ prof David Brat wrote an article on usury in 2011, citing his own education in a Calvinist seminary.

 The answer to usury is likely a good proxy for the answer to where one stands on capitalism. And there, my friends, we have a good story, because that is the story of our day. Capitalism is the  major organizing force in modern life, whether we like it or not. It is here to stay. If the sociologists ever grasp this basic fact, their enterprise will be much more fruitful.We set alarm clocks to follow the schedule of the market. Children leave their families to follow the job market.We often weigh our social worth by looking to market wages, salaries, and consumption patterns.We spend much more time on market activity than God activity. Thus, Calvinism.

"We"? set alarm clocks...  yes, capitalism is a positivist system of policies that benefit some and not others.  And while Brat is making it clear he limits the "we" to those who are the winners, I think he is being facetious when he equates worshipping Mammon and rejecting God to Calvinism.  He probably wrote this before thinking about running for office, knowing (believing) his audience in this obscure journal will be that of two friends.  And, as to capitalism, "It is here to stay."  Or as they used to say in the Soviet Union about communism:  Это здесь, чтобы остаться.

Brat makes an error in his introductory comments, he assumes correlation is causation, that is the engine of change is capitalism.

 This is due to market capitalism. Over two billion people now have food to eatand some minimal goods to go along. So, as a seminary student concerned with human welfare, I naturally wanted to learn about these free markets.  (Emphasis editor's)

This is the relentless slight of hand capitalists perform, to equate capitalism with free markets.  It is absurd to think in either China or India government policy effected any change.  What happened was a lack of government control, concomitant free markets, and thus an advance in human commonwealth. The Chinese Communist party knows full well they had little to do with the success of the last 30 years, they know they merely got out of the way. Their big fear is now the excesses of the capitalists among the free-marketers. Capitalism and free markets are mutually exclusive because of the usury aspect of capitalism, and its enforcement by state violence.

As another preliminary he notes Calvinism allows for -

 God is the source of morality and ethics. In brief, I think that God tells us that if we intend to love and help our neighbor by such an action, then the answer is “yes”; to harm, “no.”

And in Calvinism that is up to the individual conscience, in Brat's view.  So essentially, "do your own thing."  And then he goes on to voodoo economics...

 Society became more and more complex as the industrial revolution worked its magic and modern life emerged in fits and starts.

Wars and more wars as usury provided for concentration of power to the point very few could actually call the shots.  The very heart of capitalism is the means of concentration of capital for the ends desired by the few holding that concentrated power.  Wars and more wars are mere fits and starts.

 A key line in ethics has been crossed. Morality, as traditionally conceived, allows the moral actor free will when making ethical decisions. It appears that we have left the realm of morality and entered the realm of power politics with the expanding role of positive rights. Capitalism is highly dependent upon the rule of law and the clear articulation of property rights. These are very much in flux at present.

The rule of a set of laws that benefit those who gain exceptional wealth through usury.  We are all obliged to pay taxes to protect those winners of the usury game.  Child sacrifice, in the form of elimination of the inconvenient and a poverty draft of the young are required to keep the system alive. Brat goes on to make the current defense of usury:

 If the borrowing party thinks that $20 in interest payments is too much, then he will simply not make the deal. Along these lines, it should be noted that in economics, all voluntary trades are beneficial to both parties and the easiest way to see this is by noting that if one were not better off, one would not take part in such a trade. Right? Right.

Right.  And when four people sit down to play poker, they are all in agreement, come what may, regardless of any asymmetry.  Even the State does not enforce gambling debts, but it sure does enforce usury agreements. And this force is noted specifically by Brat.

 Let me add one more definition to the picture to heighten this tension. In economics and political science, it is common to define the government as the entity that holds a monopoly on violence. This definition goes back to Max Weber,9

He is supporting another point, but my point is Brat is well aware that the State ultimately rests on violence.   He then approves of the state with a profoundly dishonest reference:

 God asked the people of Israel: Are you sure you want a king? That is a good question to ask at this time.

Don't take my word for it, read 1 Samuel 8 - 10, and 1 Samuel 12, and indeed, the entire Bible to see how profoundly dishonest this is, and probably why he himself did not cite the passage to which he refers.  And his summary of the progress of acceptance of usury is also dishonest for its tendentious assertions.

Brat summarizes Calvinism:

 I like the world that God has made, and I like Richard Niebuhr’s depiction ofthe Calvinist “type” in his famous book Christ and Culture .16  Calvinists believe in Christ the Transformer of Culture.We are called to make it better, in history.

If so, then this is a pithy exposition of why Calvinism is heresy.  It's not our works that make the world a better place, it is Christ indwelling that produces good fruits from our labors. Christ redeemed the world, that work is done.  Now Christians are to manifest that is true, not claim to be doing a job at which Jesus failed.

 Fifth, preach the gospel and change hearts and souls. If we make all of the people good, markets will be good. Markets are made up of people. Supply and Demand are curves, but they are also people. Nothing else. If markets are bad, which they are, that means people are bad, which they are. Want good markets? Change the people. If there are not nervous twitches in the pews when we preach, then we are not doing our jobs.

Now we get to it: change or die.  Where have we heard that before?  So in an article on the morality of usury, the summary call to action is...

 We could also follow the micro loan experience of those in poverty around the world. The peer pressure they put on each other in the form of moral suasion results in very high repayment rates.

Bring on usury! Who would see that coming from a politician?

Two parts, secondarily, he recognizes peer pressure, that is no government violence needed in markets, just moral suasion.  This is free market, and contrary to capitalism, which depends on violence to maintain its asymmetrical gains.  Primarily, he advocates microloans, which have proven a relentless and unmitigated evil for all who are involved.  Those who say different are either ignorant or liars, and since micro-loans are war on the poor, anyone advocating those would study them carefully and learn the facts on the ground.

So the evil banker's-ganymede Cantor has been replaced by a seminarian whose path to Congress is on the backs of students enslaved by usury to get an "education."  (Tuition alone is prox $70K for a BA at his college.) The world will be a better place when a pro-usury congressman is replaced by a pro-usury congressman.  Watch out Wall Street!

For more theatre, Brat is being proffered as exhibit one in the boogey-man fear of the tea party radicals coming out of the Bundy ranch swamp and taking over congress.  Sigh.  Brat was as well known in his congressional district as Cantor.  He is a gadfly ever on the news as the "go-to" college professor with the other acceptable opinion on whatever.  And his democratic opponent is another professor from the exact same college at which Brat professes.  Aside from the fact there is not even such a thing as a tea party (if so, where is it's headquarters? who is its chairman?), no one anywhere has anything to fear from a complete take-over by the tea party, given that they will not threaten the warfare/welfare state.  Alles gut, Kommissar!

The article from which I am quoting is $25 or something for 11 pages, but I am a UCBerkeley instructor so I get free access to the entire UCBerkeley library system at no cost.  Man, priceless!  Noncredit ed is massive in the USA, and there are some 1300 schools looking for instructors.  Go back to college, but as an instructor. I actually wrote a book on teaching, writing, publishing on the side, which may be found here.

Perish Your Publisher



And while I am at it, may I recommend a campaign theme song for Brat, the German version, to compliment the language of Calvin?


Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post

Exporting Food Now!

Right now one participant is arranging and export of gluten free cake mix to Spain, we have the resumption of geoduck exports to China, and exporting meat to Hong Kong may be better from Uruguay than USA, according to the research.

Chilean exports of fruit to Asia is handled in part by agents in Washington state(!?!).

If you know anyone in the food trade, or looking for a direct, efficient means to discover business, I have the online exporting food course coming up again June 24.

http://seattleteacherscollege.net/exfoassmbu.html

Back in the 1970s I was travelling twice a year to China trade shows to buy products and then twice a year around USA to trade shows to sell products.  I've noticed over the years a sort of atrophy in which many entrepreneurs have lost the art of trade show participation.  I am distressed that these are largely viewed as "trade lead" shows.  No way!  Trade shows are for order writing.  My solution is to teach classic trade show participation, a part of this online seminar.

If an when the class yields you enough business to warrant attending a trade show, then you will have the option of joining a cohort of others in a joint venture trade show for food overseas.  More here....

But we get customers first, as always, and then grow...

Here is the schedule for summer, and I am running two sections, to be available for people taking this at work or otherwise.

Summer 2014 Tuesday 6/24- 7/15/2014 Four Sessions

Section One ~ 1 PM to 2 PM Pacific Time

(This would be 2 PM to 3 PM Mountain, 3 PM to 4 PM Central, 4 PM to 5 PM Eastern)

Section Two ~ 6 PM to 7 PM Pacific Time

(This would be 7 PM to 8 PM Mountain, 8 PM to 9 PM Central, 9PM to 10 PM Eastern)

Sign up now to assure a place in the seminar...

http://seattleteacherscollege.net/exfoassmbu.html

Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post

Wealth and Specialization

If wealth is judged to the degree what assortment of goods and services are accessible to the community with their own money, then we get an economy constantly matching resources to needs.  There is division of labor and specialization, constantly adjusting.  This would be a comity, where people cooperate.

If you believe wealth is judged to the degree one person has accumulated assets, then you either desire to be as "wealthy" as possible, or endeavor to get that wealth redistributed.  Hence the eternal rearranging of deck chairs on the Titanic by democrats and republicans.  This would be a polity, where the powers that be direct all.

But assuming the first definition, then there needs to be means of financing that matches the definition.  Indiegogo seems to fill one possible means of financing in the former comity.  Apparently is is a means of distributing charitable contributions.  Well, it does foster creation of products that need financing, such as this.

Laws are being written by the progressive fascists to crush this means, because it is felt to be contrary to the latter definition of wealth.  But after the capitalist system goes down, like communism did, we'll need to recall what was sustainable.

Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post

Alternative Finance - Shariah Compliant

Reading a paper on Islamic finance I find:

It is known, on the other hand, that interest based
financing does not necessarily create real assets, therefore, the supply
of money through the loans advanced by the financial institutions does not
normally match with the real goods and services produced in the society,
because the loans create artificial money through which the amount of
money supply is increased, and sometimes multiplied without creating real
assets in the same quantity. This gap between the supply of money and
production of real assets creates or fuels inflation. Since financing in an
Islamic system is backed by assets, it is always matched with corresponding
goods and services.
(Mufti Muhammad Taqi Usmani, 1998, p.14).

Exactly.  So there are legal claims of ownership of what assets exist, derived from a no-skin-in-the-game participation, that are greater than existing assets.  In fact, in the West, those with legal claims to assets-without-participation are greater than those who created the assets, that is put in the effort and took any risks.

A business person may have gotten nominally rich, but their wealth is subordinated to the usurer.

This paper surveys various practices in Shariah-compliant finance, and finds

Mufti Taqi Usmani has dealt with both types of Islamic rules. Living under
constraints, the Islamic banks are mostly relying on the second set of rules.
The Banking system put forward by Mufti Taqi Usmani is based on the best
possible concessions that may be availed of in the transitory period where
the Islamic Institutions are working under pressure of the existing legal and
fiscal system.

What is the pressure?  Competition for profits or patronage?  Flexibility is admirable, but what if adherence offers better results?

Even with these concessions, the system that has been put forward is in a
collision course with the conventional Banking system and in the future one
of them will have to totally move out of the picture.

How come?  Why cannot both exist at the same time?  Panarchy!  In fact Islam is fairly unique in historically tolerating panarchy within an Islamic theocracy.

With the world economic order tottering, these questions are critical, and even the Pope is taking action, laying down the law...

The announcement on Thursday was only the most recent in a series of firings, replacements, and arrests that have rocked the Vatican’s financial hierarchy. It turns out that for Francis, casting the moneychangers out of the Temple has proven to be a time-consuming task.

I suspect Francis is taking his time because it is so much fun.  Will he move on usury?

Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post

Why $100 Detroit Houses are a Bad Investment

Economic recovery comes from relaxation of rules and regulations with a renaissance in manufacturing.  the politicians appointed by politicians know nothing of this.  What is their plan for recovery?  More casinos, for the casino taxes.

Orr has described the gambling taxes as Detroit's most stable source of money. But casino revenue has declined of late in Detroit itself and in recent years traditional gambling hubs like Nevada and New Jersey as well as relative newcomers to the wagering scene, such as neighboring Ohio, have seen swoons.

Brilliant.  Take welfare and pension payments, redirect them to very wealthy people  who will invest it elsewhere, and skim a percent off the top.  And from this will come an economic recovery.

This si the same plan drug dealers use, flood the ghetto with drugs, take welfare payments and launder it worldwide.

Until there is no State or federal government in Detroit, any investment, even $100 is madness.  Secretary of Treasury John Connally once loaded up on bonds, at rock bottom prices.  Then the prices dropped further.  He was wiped out.

When they repudiate the debts, go Hong Kong, and while blood is flowing in the streets, then invest.  The people responsible will have been long gone, with their terrible advice.

Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post

World Trade Patterns in Food

Just finished reading a report on….

New directions of trade for the agri-food industry:
a disaggregated approach for different income
countries, 1963–2000
Rau´ l Serrano • Vicente Pinilla
Received: 4 October 2013 / Revised: 19 March 2014 / Accepted: 25 April 2014
The Author(s) 2014. This article is published with open access at Springerlink.com

Here is the summary…

This new process of market integration was far removed from the pattern ofcomplementarity developed throughout the first globalization. Both total trade andtrade in agricultural products and food have become progressively concentrated onthe exchange of goods among developed countries. Nations which historically weremore dependent upon the export of agricultural products and food saw theirtraditional market shares fall, while the more developed countries increased theirexchanges. Thus, the regions most dependent on the export of agricultural products(Africa and Latin America) witnessed a fall in their share of world agriculturaltrade.1 Moreover, some of these countries not only saw their exports decline inrelative terms, but also experienced a sharp deterioration in the ratio of agriculturalexports to imports. Thus, Africa and Asia became net importers of agriculturalproducts where they had once been net exporters. By contrast, the high-incomenations, and in particular Europe, increased their share of world agricultural trade.

This is not accidental, not is a matter of policies…  in essence, "free trade agreements" work inasmuch as they disrupt trade patterns to the benefit of some and detriment of others.

The developing countries have depended on exports to their traditional markets,which is to say Old Europe and rich North America. However, this position hasprogressively changed. The agricultural exports of developing countries to countriesof similar income have significantly increased. These already represented 31 percentof total agricultural and food exports by 1990, a figure which increased to 38 percentat the end of the last century. This new trade pattern, with an increasing importanceon the direction of South–South flows, is common to all the developing regions, andthis is possibly related to the growth of the so-called emerging economies,increasing market liberalization and the success of some trade agreements amongdeveloping countries from the 1990s on.3

Of course China plays a big role in this, and it is natural for poor countries to trade with poor countries, but the interesting part is growth.  In spite of being crowded out, these countries are growing.   Or… because of being crowed out, not being the subject of "agreements" they are doing better.  That would be my hypothesis.

Lastly, the governments of the more developed countries supported agriculturemore than any other sector. By contrast, in the developing countries, it is habitualfor inward-looking policies to discriminate in favor of industry as regardsagriculture. Within agriculture, the sector oriented toward the production offoodstuffs for the domestic market received greatly support than the export market-oriented production (Anderson 2009).

Here we go again…  sectors subject to policy get hammered, that which is let alone, thrives.

Merely in the 1990s, the Uruguay Round of GATT was able to produce a certainliberalization of the markets in agricultural products and a reduction of protection-ism. From that point on, and also as a consequence of the dynamism of the Asiancountries and of the stimulation of RTAs among developing countries, a new patternemerged in the exchanges of agricultural products, defined by the boom in tradeamong the economies of the South.

This study then gets busy with econometric models that are Greek to me.  But afar all that, here is a conclusion:

To explain the concentration of trade among developed countries, our gravitymodel has underlined that RTAs such as the EU, EFTA or NAFTA havesignificantly encouraged agricultural trade among developed countries. In contrast,the developing countries were faced with highly protected markets and a relativeinitial failure in their attempts to liberalize their regional markets.

The world trade in food is in flux.  There are some verbs trance anomalies pursuant to the policies, some unsustainable and inviting disruption or better yet, correction.  One can see it in the trade data analysis.  Pick a product area, and start nosing around.

Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post

USA Beer Export Trends

Chile is buying more USA beer, Hong Kong is flat as a mug of week old PBR, and China is enjoying a 5000% increase.

USA Beer Export Trends c 2014 John Wiley Spiers
double click to enlarge

Email me if you want a .pdf of this.

Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post

Kegs Are Instruments of International Traffic

HQ 109634
August 11, 1988
BOR 7-07-CO:R:P:C 109634 BEW
CATEGORY: CARRIERS
Mr. James Burghart President A. Burghart Shipping Co., Inc.

Newark International Plaza Newark, New Jersey 07114
RE: Beer kegs as instruments of international traffic (IIT)
Dear Mr. Burghart:

This is in reference to your telex of May 11, 1988, and your memorandum June 27, 1988, in which you ask that we classify certain beer kegs as instruments of international traffic (IIT).

FACTS:

The beer kegs are of substantial stainless steel construction and are capable of repeated use. They will be used to transport beer from the Netherlands to the United States moving under an IIT bond. After emptying, the kegs will be exported to Heineken Brewery for cleaning and reuse. The ports of entry will be New York/New Jersey.

The kegs will have their own unique serial numbers, and will hold 13.2 and 15.5 gallons each. There will be a total of 145,112 of the smaller kegs and 3,249 of the larger kegs.

ISSUE:

Whether the beer kegs may be brought into the United States as instruments of international traffic.

LAW AND ANALYSIS
Section 322(a), Tariff Act of 1930, as amended (19 U.S.C.

1322(a)), provides that "[v]ehicles and other instruments of international traffic, of any class specified by the Secretary of the Treasury, shall be granted the customary exceptions from the application of the customs laws to the extent and subject


to such terms and conditions as may be prescribed in regulations or instructions of the Secretary of the Treasury."

- 2 -
The Customs Regulations issued under the authority of section 322(a) are in section 10.41a (19 CFR 10.41a).

Paragraph (a)(1) of section 10.41a designates as instruments of international traffic lift vans, cargo vans, shipping tanks and certain other named articles and states that other articles may be designated as instruments of international traffic by the Commissioner of Customs in decisions to be published in the weekly Customs Bulletin. These instruments of international traffic may be released without entry or the payment of duty, subject to the provisions of section 10.41a
To qualify as an "instrument of international traffic" within the meaning of section 322(a), Tariff Act of 1930, as amended (19 U.S.C. 1322(a)), and the regulations issued thereunder (19 CFR 10.41a et seq.), an article must be used as a container or holder. The article must be substantial, suitable for and capable of repeated use, and used in significant numbers in international traffic.

We find that the beer kegs under consideration may be used as a container or holder, that they are substantial, suitable for and capable of repeated use, and that they are used in significant numbers in international traffic. We further find that the beer kegs under consideration are similar to beer kegs which were designated as instruments of international traffic in Treasury Decision 66-15 (stainless steel half barrels and quarter barrel beer kegs, imported containing beer, used primarily after importation for onward transportation and for dispensing beer, and not for storing or aging the beer), and are similar to certain beer kegs which were designated as instruments of international traffic in Treasury Decision 68-81 (stainless steel beers kegs of a capacity of 9.2 gallons more or less, sometimes referred to as 1/3 barrel kegs of the same type and used in the same way as described in 66-15).

HOLDING:

The beer kegs under consideration qualify for treatment as instruments of international traffic and may be released under the procedures set forth in section 10.41a, Customs Regulations.

Sincerely,B. James Fritz Chief Carrier Rulings Branch

Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post

Tracking Shipments

Jim checks in from Oakland:

On Jun 2, 2014, at 6:11 PM, Jim wrote:

Hi John,  Hope all is well, I just learned today that we can track all ships.  This is nice to know as I will not need to contact the broker.  Once the ISF is filed the ship name is on so I can track the ship.  We have a container heading our way and it shows is a 14,000 TFU (Twenty foot equivalent) ship, averaging 19.4 knots and drafting 42 feet of water off the cost of Taiwan heading to Oakland and checking in every 30 minutes.  This information is handy,  One more layer of the onion peeled.

http://www.marinetraffic.com/en/ais/home/centerx:119.4859/centery:24.4501/zoom:8/mmsi:566705000

The ship is APL Dublin so I googled up APL Dublin and it all comes up from there.

http://www.marinetraffic.com/ais/details/ships/9601314/vessel:APL_DUBLIN


My hobby is growing, ordered 3 full container from China last month! 

Thanks

Jim

Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post

Forbes Covers & Russia/China Gas Analysis Wrong

The world billion is on the June 16 cover.  I suppose it is an element they discovered must be on a cover to get optimum sales.  If so it is promoting personal accumulation as opposed to commonwealth.

This edition has some puzzling stories... A safer cigarette.  Oh.

And how a woman became the head of General Motors.  Well, we know how, General Motors is run by the government and a woman was put in charge.  There has never been a woman in charge before because opportunities are restricted in capitalism.  Putting a woman in charge just means a bit of theatre before it is run into the ground.

Forbes should do a story on how both the Mustang car and Marlboro cigarette were designed by men to be targeted to women.  And imagine that.  Women were not attracted to either.

In a free market there would be the optimum amount of women running whatever companies, because there would be no bar to women running car companies.  And then perhaps we'd see women designed cars.

Another very odd piece is Steve Forbes steps put of character to mock the Putin/China gas deal.

Putin is naturally spinning the pact as an “epochal event,” but in truth it’s really no big deal. Divide that $400 billion by 30 years and you get an annual average of $13 billion. The size of the global economy today is almost $80 trillion. Seen in that context the contract rates barely a footnote. AT&T’s proposed acquisition of DirecTV merits more attention.

Whew, the head spins.  Let’s see if we can find some borders:  we are comparing one deal to the entire earth's economy...  how is that enlightening?  And then comparing an early stage industrial material input (gas) to a final stage consumer service output (TV shows.)  Somehow, we are to equate a $400 billion gas deal with a $50 billion TV deal.  This is good analysis?

Let’s do a more sensible analysis.  Instead of comparing the presumed productivity of couch potatoes watching Seinfeld re-runs to Russian energy in China, let’s get some sort of benchmark by looking at what USA does with energy inputs.  So we head over to the go-to guys on energy, the American Petroleum Institute, with its headquarters in hell, but has pretty accurate records, and we find as to its studies...

They do not capture any forward linkages (i.e., the economic impact on production in sectors that use oil and natural gas as an input). 

Man, we need that info.  Someone should do it.  Sounds like a masters or Phd thesis.   But what this API report does have is this...

The industry’s total impact on US GDP was $1.2 trillion, accounting for 8.0 percent of the national total in 2011. 

So the USA national total was about 15 tril in 2011.  Given the 8% figure above, the multiplier effect for energy usage in USA is roughly 12.5 times.

So let’t take 400 billion Russia/China deal and see what that is worth in supporting economic activity over thirty years...I get five trillion dollars.

OK, let’s take it yearly, like Steve does.  13 billion times 12.5 equals $162.5 billion, per year.

China’s GDP in 2013 was about nine trillion in dollars, so using a USA benchmark,  this single deal adds $162.5 billion, or roughly 2 % to the economy in terms of productive value.  OK, does not seem like much, but 2% of an economy is no small thing.  And one deal out of how many?  Out of what trend?  And then reverse the impact, take that same amount away from Europe, to where the gas was earmarked before the stupid "sanctions", and ask how is Europe going to maintain its welfare state obligations with yet another input source lost?

  But we need to find a Chinese benchmark for how much leverage China gets out of energy.  I suspect China applies energy more directly, with less wastage in USA, getting more bang for the buck. This is another thesis for a masters degree.  I won't do it, but Forbes should have, instead of comparing Russian gas to China as opposed to people watching TV in USA.  

And for those 2014 graduates who are now heading into unemployment with a crushing debt, here is Steen Jakobsen - 

After close to 30 years of doing this job I am realizing that energy is everything in explaining growth, investment, sentiment and market returns.
Understand energy and its marginal price of production and its delivery and you have the keys to predicting the world.

That means top analyst Steen got his start in the mid-1980s, and he is just coming, end-of-career, to this realization about oil and energy.  I was already informed on this while in high school in the 1960s, as the anti-fascists made clear the American war in Vietnam was about the oil in the Spratly and Paracel Islands (over which Vietnam and China are contending today.)  With the switch to the poverty draft for the military, and the destruction of the labor unions by gutting the manufacturing base,   USA no longer has any pro-freedom, anti-fascist movement.  So the word does not get out at the beginning of one's career.  One advantage of taking down the capitalist patterns and practices would be to revive manufacturing and a labor movement in USA.  

So graduates, ask questions, take take the "truth" apart.  When Peter Drucker was in his youth before WWII in Austria, he had read all about the struggles to create the Panama Canal, to shorten northern hemisphere shipping times.  In all those histories, he did not ever read whether it paid off.  Did it have the intended economic result? The purpose was an economic result, but no one had ever bothered to see if it was achieved.  So he studied that and wrote it up.  Look at the facts, and ask the most obvious question.  This will most likely get you into trouble, especially if no one has answered it.  If an obvious question has not been asked, expect some powers that be do not want the answer out there.

But ask and answer the question, and way you go.  Drucker was no one special in his youth, indeed, he considered himself a bystander.  But his questions got him in front of all sorts of top people last century, including Sloan at General Motors, for which he did an efficiency study.  His questions turned Drucker into the premier biz thinker of the 20h century, and Drucker a mere sociologist.

And people who had him in class thought he was ever so boring.  He probably was.  Most of his books are dreadully so, but two I liked a lot, Innovation and Entrepreneurship and Adventures of a Bystander. Very readable and enlightening.

And incidentally, in Innovation and Entrepreneurship, Drucker lays out why entrepreneurs NEVER take risks. His argument is perfectly sound, which sent me off on the trail leading to banks lending off-sheet credit, and now with unlimited credit, needed to introduce the idea of risk to trap people into debt, which is how we got to where we are today.

Innovation and Entrepreneurship

Adventures of a Bystander



Feel free to forward this by email to three of your friends.

Bookmark this post --- Email this post