Magic Show Gets Critiqued

Sound familiar?

Also, the shows are way too big. These trade shows have lost their luster. There is not enough newness. There is no way that you can cover all of those Las Vegas trade shows.There’s too many shows in a big area. They charge a lot of money for vendors, so start-ups can’t go there.

Every show is desperate for new, and you, as a start-up are new.  I am intimately familiar with this problem, and show how we to get your new in prime location in my classes.

There has become a sameness among the shows, and in an industry based on fresh ideas it is time to hold the directors of these shows to the same high standard we as retailers are held to by our customers.
They should also strive to seek out new brands, new technologies and new platforms for the design, layout and promotion of the shows.

The markets badly need you to start your business, competing on design not price.

Also, the merchandising needs to be curated better at MAGIC.

The pendulum is swinging back, get going now.

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Ex Im Bank Mendacity

Mendacity!

The Export-Import Bank, also known as the Ex-Im Bank, announced today that it returned $675 million to the Treasury Department. Because it's a government agency, it's technically not a profit. 

If this were true bankers would do it.  It is not true.  If a bank offered the accounting that EXIM Bank uses to arrive at this number, people would go to jail.

ExIM Bank books losses as assets.  Try that in your business.

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Medical Tourism - Ebola Cure

What to make of a country where for 40 years they can allow suffering and death by a horrible contagious disease, as a government project, only ending in the 1970s?  Well, when no one was jailed, let alone executed for these deaths, why would this stop?

And a country that after claiming to fight a war to end slavery, actually amends the constitution to enshrine slavery as legal.

And a country that not only brings in massively infectious diseases to play around with in government laboratories less secure than you average high school, but imports people infected with this disease.

After getting a patent on ebola.

Of course I have no proof, but using disease as a weapon is nothing new, and I have no doubt the country above, the USA, is doing so now.  No one can be this stupid, it must be intentional.

Happily we have people who take all these USA actions into consideration and reacts.  The Chinese already have an apparent ebola treatment, in fact 15 of them, and I wonder if they began working on it the day USA took out a patent for dual use (weapon/medicine) on ebola.  This comes out of their military defense program. They must have the same suspicions as I.

China of course, as any sane country would do, forbids anyone from importing infectious diseases, so they are working with synthetic versions.  I would bet they have crews in Africa working on it too.

Odd too, Cuba, which for 50 years has been under assault by USA, seems to be best prepared to deal with such horrors, "punching above its weight" in fighting the disease in Africa.  Cuba sends doctors.  USA sends soldiers. What does this say?

We've seen this before, Mutually Assured Destruction,  MAD, in which both sides have weapons so horrible neither will use them.

After tidying up this outbreak, it is important to trace it back and find out what happened.  Of course we have never done this for crack, even though we know the time and place it first appeared in USA, and on whose watch.  And we know some serious talent went into the design of that drug.

Going to prison or worse keeps people quiet.  We need to have truth commissions and guarantee no prison, even for capital crimes, if people come clean.  We are in the most opaque times in history.  Truth commissions may allow us a peaceful revolution.

And of course, this crisis feeds the USA habit of blaming the black guy, as if this is his fault.

Drudgereport.com

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UK Reports Small Business Recovery & Challenges

Here is a study done on UK businesses, which brings up issues not well addressed.

When asked about the cost of credit/financing their business, 29% said the costs had increased, compared to 24% in the previous quarter. Despite this, 82% of businesses claimed they will either freeze or reduce prices in the next 6-12 months in order to remain competitive. By contrast, just 18% will raise prices.
Continuing, Hamilton said: “It is worrying that more than half of SMEs are concerned about late payments and cash flow, two issues that are intrinsically linked. Despite the ongoing media spotlight on late payments, this seems to be an issue that continues to grow without any resolution on the horizon.
“Further exacerbated with rising costs of credit and greater competition from a global marketplace, being able to find a solution to these issues could either make or break a UK business.
“SMEs are in a Catch-22 situation; they are unable to access credit to improve cash flow, inhibiting their ability to grow, which in turn further prevents their ability to access credit. It means SMEs are struggling to find funding to grow and stay competitive in the global marketplace.

Do you know what cost of financing was for businesses 50 years ago?  Near zero.  To this day I recall the meeting in which it was decided we would charge our customers interest if they went over 30 days as agreed on payment.  USA had gone off gold-standard lite, banks were mailing live credit cards out without an application, getting rid of all this credit to lend made (at interest) infected small business by scandalizing us into charging our customers interest.  As borrowing EZ credit from banks with nearly no standards (but at interest) became on balance a preference to maintaining standards with suppliers and no interest.  Where zero-usury guardrails kept many more people on the straight and narrow and within community constraints, countless people jumped the rails and crashed.

Yes, letters of credit encumbered a line of credit that was drawn upon at the point of payment, and the money drawn on that line was at interest, except...  USA interest rates at anywhere from 3 to 21% never mattered since importers secured 60, 90, 120 day sight LsC, meaning the seller agreed to delay payment for that time.   Yes, you escape USA interest, but you do cover, one way or another, the seller's carrying cost of your delayed payment.  So what is the difference?  Just about every country does the crazy EXIM Bank wealth transfer thing, and say, Japanese export interest rates are subsidized so a USA importer pays probably 1/2 the going USA rate.

There are no guardrails any longer, but one can still know what works and drive along the right road anyway.  Just because there are no guardrails does not mean you must crash.

Slow pay is a problem of discipline which can be managed.  The degree to which this problem is growing is the degree to which SMEs have lost the tradition of knowing their customers credit and managing the relationship.

So how to deal with this Catch 22 problem of SMEs finding less credit and what is there at higher rates?  Tack into this wind!  There is credit pitch perfect to your operations at zero costs if SMES simply stop using this unnecessary credit, which is degenerate anyway, and begin to extend credit, with what goes around comes around.

Yes, you'll lose customers, but the ones you have will be all the stronger.  Yes, you'll lose customers, but what is that segment that you are losing costing you in interest payments necessary for the funding to carry that segment?

Will checking credit and managing payment discipline bring added costs?  i don't think so, I think it would be simply a shift of resources from degenerate activity of false economy EZCredit  management to the same people simply managing generative good customers.

A great master's thesis study, that.

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Mag Lev and Unemployment

Previously in USA history, as disruptive technology came along, there was non-regulation or deregulation to accomodate people adapting to the changes and finding work and jobs.  All those people trapped in careers at Ma Bell in the 1980s, we able to quickly learn how to thrive in the new alternative after being fired from Ma Bell.  Buggy whip makers began to wrap leather in steering wheels for Ford Motor Company.

We no longer have that.  The rules, the regulations, taxes,  etc now compel innovators to outsource the new jobs, and the welfare state traps the unemployed.

Mish has a series on a topic dear to my heart, and that is driverless trucks, a step toward mag lev.  There is no need for drivers any longer, and this will work well if the Hegemon is not allowed ot participate.  We only need to look at electric cars to see the most recent mess they make of things, of everything.  They can't do their basic job, keep attackers out on 9-11, keep ebola out today, get currency right, manage the borders, etc.  Why would anyone think they could manage or contribute anything in mag lev and smart roads?

 But an even more basic problem is as all these truckers and taxi drivers become unemployed, there will be no new industries opening to which they may migrate.  The telephone monopoly break-up was attended by telephone deregulation.  No end to the work there.  There is no longer any deregulation in USA.  More welfare prisons ahead.

Deregulate something.  Anything.  Banking, medicine, roads...  food, anything.  The survival of USA depends on it.

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Rogers On Tradable

The term tradable is necessary for people to understand how economies actually work  Investors see something evil in the way of policy and its effects and say, well, I see how I can make money in this instance.  The shorthand for this is "tradable."  It stinks, but money can be made.

Why are you buying US dollars now? Are you betting on the US economic recovery?The US dollar is partially gaining strength because there is turmoil in the markets; people are worried about the Middle East, Russia, and when people are worried, they quickly resort to the US dollar to make payments. The US dollar is not safe haven anymore, but people don't understand that. As long as there is turmoil in the world, the dollar will go higher and higher, and this will hurt many countries and economies. And my plan is when the dollar goes higher and higher, I will sell the dollars. Having said that, currently I am long on dollars.

These situations arise for the simple reason policy makers are picking winners and losers.  people like Jim Rogers are supposed to complement the policy makers and become a loser, transfering their wealth to the designated winner.  they don't but they are too small to worry about.

China is supposed to be a loser as well.  They refuse, in fact they play it like Rogers.  In response our country libels China in response to the Chinese not making USA policy successful in harming China and helping USA welfare queens.

Some of the emerging economies, including India, are showing signs of recovery. Is it sustainable?Well, that has been true for most part of the world because vast amount of money has been pumped into Japan, America, Europe, and the UK. Whether the recovery will last or not I don't know. But these are all artificial money which has been pumped in to rest of the world.

"Artificial money?"  We don't even have words for asset-less backed tallies of debt, but that is to which he refers.  Rogers is rich because he understands words matter, definitions matter, and he does not accept the word "money" when people disguise debt with it.

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The Convict's Gambit

If you are going into sales as a profession, you probably genuinely like people already, but at the same time you take no nonsense  You read people well.  The rest of us must be merely good consumers of fine sales talent, so we get the best performance and the best performers get the work.

Here is a phenomena that would devastate us, but not phase a sales professional.  Let me take it to where it is most marked.

In a prison, a convict has to build something from nothing.  The leaders start with nothing and build it up.  For example, at lunch one convict may stand to get a refill on say coffee, and the leader with nothing so far might hold up his cup and say "can you refill mine too?"  Ignoring the request would be rude, to say no unfriendly.

Now, all ex-cons know where this story is going already.  In prison, no good deed goes unpunished.  So the fellow fills the two cups with black coffee, goes back to the table sets his down and hands over the cup he fetched as a favor.  It does not matter what happens next, in any event, all goes wrong.  The cup is spilled, the coffee is too hot, too much sugar, the fellow asking for the favor is offended, and the guy that did the favor is apologetic. Starting with absolutely nothing, the aggressive convict now has the upper hand.  From there he slowly builds his empire.  It is a simple as that.

The empire is built on people who apologize after doing a favor.  There are versions of this in all walks of life, but they seem to flourish as buyers, and sales people can spot them instantly.  There are plenty of people in prison who do not get sucked in, and salespeople are like those who can keep the balance, do no favors, no reaction to either praise or criticism, genuinely get along.

(A smart prisoner has spun around and is gone before anyone can ask a favor.)

A little story: I was witness to a spilt hot coffee event in a booth once, and the salesman observed impassively, did not react.  There were people closer who naturally might have assisted her, but they were all also impassive.  So I held back.  Someone did wordlessly hand her a couple of napkins. I asked afterwards, and the salesman said "She's 50 and still burning herself on coffee?"  (To have pointed out the fact the coffee was not hot would have opened an avenue for the buyer to get into a tiff over "what is hot?")

This is all a form of emotional blackmail, and the reaction is to smile as if patiently waiting for a child to finish a temper tantrum.

I am not picking on buyers, about half the time I am a buyer.  Most buyers don't run that gambit, the problem is they can ruin your day if you let them.  Sometimes the best reaction is no reaction.

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Ex Im Bank Roundup

Boeing goes all biblical when discussing ExIM Bank...

“How would you plan for an Armageddon?” Kostya Zolotusky, managing director for capital markets and leasing at Boeing, told Bloomberg. “We’re not planning for an Armageddon. You can’t plan for an Armageddon.”...
Jeb Hensarling, who oversees the Export-Import Bank as Republican Chairman of the House Financial Services Committee, said in June, "We cannot reauthorize the status quo,” and the bank may be “guilty of corruption,” cronyism, and sending taxpayer money to foreign interests, according to Bloomberg.

And in an exercise of State's Rights, Gov Cuomo wants a grand tour paid for taxpayers with his own ExIm Bank to spread favors and disadvantage enemies.

The state will initially invest $35 million in the effort. The money would be loaned to companies looking to expand their overseas exports.
Cuomo says it is part of a larger push to help companies take advantage of growing international markets.
He says that as part of the initiative he'll go on trade missions to five nations: Canada, Mexico, Israel, China and Italy. Dates for the visits haven't been announced.

Daily Caller has an article on how women and minorities get little in ExIm Bank funding (well, duh!)  but it is one of those sights that loads so much advertising that it crashes... 

And here is your taxpayer going to keep bad business overseas propped up, and their politicians as well.

Export -Import Bank is back up to its old tricks – awarding taxpayer backed goodies to some questionable foreign recipients.  This time those goodies came in the form of recently announced handouts to Pemex, the infamous Mexican State owned Oil Company, that cashed in this month on over $1 billion dollars in long term loan guarantees from the Export-Import Bank.  This is nothing new as Pemex is Export-Import Bank’s largest debtor – leaving American taxpayers on the hook for over $6 billion of the $12 billion that has been loaned out to the oil behemoth.

Can't we get rid of just one teentsy weentsy bad idea?

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Whiskey Sales In Hong Kong

When the high end gets going, people with less income than millionaires also jump in with specialty versions.

Daily spirit consumption is also on the rise. According to a market study conducted by Vinexpo, the Asia-Pacific region leads the world in spirits consumption, accounting for 62.76 per cent of the total global volume in 2012. A massive 55 per cent of this growth occurred between 2008 and 2012.
In Hong Kong alone, 1.39 million nine-litre cases of spirits were drunk in 2012. While baijiu – a distilled spirit from China – retained the largest market share with a little more than 60 per cent, consumption of vodka, cognac, liqueurs, brandy and gin was also on the rise.

My exporting food & beverage online class, link on the upper right, started last night, but not to late to join and catch up.  If you need to go straight at customers now, whether as a producer or an agent, this is the class for you.

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How To Scam In International Trade

Laws reveal weaknesses and our strengths are our weaknesses.  We have laws against theft because people tend to steal. The legal system that can lead to such spectacular results in USA has people Americans confident it is the only system that makes sense, and everyone would agree to it.

Since value is built-in to our system, so it is assumed, all that is left is to structure a deal, and once structured, people are legally obliged to perform.

The rest of the world works on value, not structure, and there is the heart of how to run a scam, especially on Americans, in international trade.

Price, product, place, promotion gets you burned in international trade.  Simply draw the American into discussions of the above, where they are confident, and then slowly compliment their conceits until you have them shipping on open account, or prepaying for goods.

The "con" in con artist is short for "confidence."  It is not the victim's confidence in the scammer that makes a scam work, but the confidence the victim has in himself.  And that is built up over time.  The longer the discussions before a sale, the more likely you are being scammed.

Never mind how to structure a deal in international trade, that is simple and fast.  Figure out first exactly what value you are providing.  The test that hypothesis with the demand for a prepaid order, a test order, to test that hypothesis.  It is either true or not.  This is determined within one discussion.

The MOQ FOB allows you to hypothesize your value and either get an order immediately, or an answer why not.  And then you can assess whether to proceed. It attracts the serious and repels the scammers.

Con artists know most people never complain about being ripped off because the victim feels so stupid. Don't be a victim.  The structure of the deal is secondary, rather unimportant.  It is knowing the value you provide that matters.  If you cannot state it, you cannot manage it, and you lose control of your business.  Expect to be picked off.

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Define Success: The Key or Combination?

What is that key to successful business start-up?    Third party observers tend to look at later facts to discern success, and then work backwards.  “He is a millionaire!” Then, what did he do?  But that is self-selected examples, on an extremely narrow criteria: money.

And to base a definition of success on a medium of exchange, and accumulation thereof sounds strange indeed.  If one’s goal is to widen the access to more and better solutions to problems, then money is to be used, invested in yet another project.  And yes for some, success is how much money they can personally amass.  So one must define success.

Success, however you define it, starts much earlierthan the post-mortem.  You need to know there is not a key to success, because it is a combination lock. Here is the combination:

Turn left to passion

Turn right past passion to joy

then left to success

Properly speaking, I’d say success is not defined by you, or anyone else, it is defined by customers. They demonstrate your success by buying your solution. No thrid party can judge whether a second party is happy with your solution...  That is only for the second party.

Then the first party, you, can assess whether given the number of people are happy, and sure, what money made (to fund your next project), your own psychic satisfaction, you can assess whether you are 'successful".  No, never can the 3rd party assess whether or not you are successful.  The only opinion that counts in business is that of the customer.

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Extend Credit Now

After Pimco Top Dog Gross quit, it is good to hear James Grant's view on bonds.  I have not been in the market for a few years, so I am not paying much attention, only to know the prognosis is not good, but the patient is evil anyway.

But the topic of bonds, and interest rates, is about the yield on loans.  AS Grant knows it very well me the bond markets that lead us down next.  O dear, for business to business working credit, what if bank credit dries up?

That would be a problem.  The solution is anarchy, where you introduce enough credit yourself.  How so?  Stop accepting credit cards as payment, stop demanding prepayment, and start extending credit, 30 days to pay. And at no interest.  Yes, you would have to develop a new skill, and that is checking credit, in essence getting to know all of your customers, and become somewhat responsible for their success.  This is the way is was before we had these crazy financial things happening.

Next beging to demand your suppliers extend you credit, so before the crunch you have already established a line with the suppliers, and encourage them to do so, since "you have done so your self."

If as Grant says it goes, then we'll have ot create our own sources of credit, if the bank credit dries up.  We did it before, it is natural, and we can do it again, the sooner the better.

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Safety Through Riches

In part this passage is talking about the effects of usury after time. This warning seems apt to the condition of many Americans, who have gone heavily into debt.  But note it is talking about countries, and what country more fits the bill than USA?

“Woe to him who heaps up what is not his own—
    for how long?—
    and loads himself with pledges!”
⁷ Will not your debtors suddenly arise,
    and those awake who will make you tremble?
    Then you will be booty for them.
⁸ Because you have plundered many nations,
    all the remnant of the peoples shall plunder you,
for the blood of men and violence to the earth,
    to cities and all who dwell therein.

⁹ Woe to him who gets evil gain for his house,
    to set his nest on high,
    to be safe from the reach of harm!
¹⁰ You have devised shame to your house
    by cutting off many peoples;
    you have forfeited your life.
¹¹ For the stone will cry out from the wall,
    and the beam from the woodwork respond.

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Patents Inhibit Innovation

Over a decade ago I finally gave in and had an orthodontist straighten my teeth.  I'd always say no way was I was going to have my teeth wired up for the two years of misery just for relative straight teeth, if they came up with braces that can come on and off, then I'd do it.

They came up with braces that can come on and off.  It's called Invisilign, and it was more expensive than the wired up thing, but, they can come on and off.  I did the treatment, I am not getting paid to say this, I was very happy with them.

The idea is simple.  The dentist takes impressions of your teeth, looks at the layout of your choppers, decides if anything has to go, and then they lay out a course of action by some sort of computer program.  The course of action is a series of plastic covers for your teeth that push and pull your teeth into a straight line.  The first ones are pretty tough, but it gets easier over time. If I recall you wear a pair for two weeks, toss those, and then wear the next pair, and check in with the dentist every six weeks to assure good progress, and adjust if necessary. You take them off for meals, or for an evening out, but otherwise they are on your teeth doing the trick.

You do need a dentist to plot out the course of action, but otherwise it is so simple.  The plastic teeth covers probably cost a buck each to make.  As opposed to adjusting wires and getting in our mouth and dealing with keep wired up teeth clean, with invisilign there is none of that.  They come off anytime you want, and people cannot see them, even though they cover your teeth.

Now, of course, this is heavily patented.  With about $100 in material costs, the fee is something like $6000, out of the reach of most people.  No doubt some good doctors are fitting out deserving poor with this innovation, but what is not happening is tw fold:

1. No competition to drive prices down and introduce better design (material, sequence, algorithm?).

2. The very competent team that brought this forth is now captured by the monopoly provided by the patent and no longer creating new, they are milking the status quo, a status quo enforced by violence against anyone who would compete.  What else might these people have brought forth if they did not have this state-sponsored cash cow?

The idea here is success is wealth defined as the personal accumulation of tallies, property, etc, as opposed to wealth defined as the number of people who have access to the widest possible range of goods and services with their own money.

People will argue that there would not be Invisilign to begin with without patent protection to recover the investment cost and reward the inventors.  I disagree: the investment cost is high because as a medical device there are violence-backed regulators who are captured by the regulated, and it takes massive amounts of money to buy enough people off to allow innovation to proceed.  If I thought up Invisilign with no background in dentistry, then countless dentists thought of the same thing long before  I did.  But they knew better than to try in USA, for the constraints on innovation are overwhelming, especially on medical devices.

We can no longer afford "intellectual" "property" "rights" in USA.

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