Renaissance of Small Business Food Exports

The reports coming in are overwhelming, big business can't do it anymore.  Check out this gov't report:

http://www.fas.usda.gov/data/us-processed-food-exports-growth-outlook

What we see here is dollar volume vs price growth, in processed vs specialty.  Think Godiva v Hershey for processed foods, and heirloom corn v GMO corn.   Processed specialty is growing 3.5 times faster over the last decade, and in bulk, for bulk, we need to talk exponentials, since GMO is dying as heirloom is up 100 times.

Now this is a graphic example of a point I am making and that is it only takes a 1% drop in GMO sales to register as a 100% increase in heirloom sales into the vacuum.  You cannot handle 100% sales increase a year in the real world, so there is plenty of opportunity to go around.

Politics aside, there is nothing to stop this trend, it was built on false credit, which has ended as an option.  Now comes credit deflation.

The project of reducing GMO crop coverage with wholesome food is going to take "all hands on deck."  Exporting gives us the opportunity to effect this necessary replacement.  As we build market overseas, more land will be needed to produce the goods.  As more countries realize the danger of GMO, its sales will continue to drop.  At the same time, USA quality control and wholesomeness recommends our specialty foods to the world.  There is work for anyone who wants it.

At the bottom of the report is a recommendation to look into cross border ecommerce.  Elsewhere on this blog I have destroyed any pro-ecommerce argument, recently again here.

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WIRs and Price Setting

This is great stuff...

 The possibility remains that barter may have forced greater flexibility in network members' cash prices. But since WIR's
bylaws restrict membership to small and medium businesses (Defila 1994), members will usually have comparatively little
price-setting power.

Now careful reading this...  the fellow is analyzing the WIR for one purpose and using common definitions.  To derive the most benefit, you must translate the words he is using into correct usage.

He assumes price-setting is "he who can achieve the lowest price and defend it."  The error here is small businesses on the specialty level are the ones who set prices high, not low, and can defend it.

Lots to chew and absorb...  think of it: an alternative currency, in which SMEs extend asset-backed credit among themselves and no interest, and then covert to dollars in bulk to settle debts denominated in dollars.  It is counter cyclical for Gresham's law, that is in inflation it retreats, and deflation is advances.  This is a wonderful discovery, and possibly how the Swiss were economically able to withstand the Nazi interferences during WWII.  Much here to chew, to learn.

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LCL Renaissance

Another indication that the pendulum is swinging back is the apparent renaissance in LCL shipping.  Brian sends this in:

Other logistics professionals report increased use of alternative routing, if the shipper can afford the extra time it sometimes requires. "The biggest difference is Asia to the East Coast," says Stephen Dedola, chief operating officer of Dedola Global Logistics, an international freight forwarder headquartered in Los Alamitos, Calif. "It's an all-water route, but costs less than mini-landbridge," in which goods are delivered to a West Coast port and moved by train to their ultimate destination.

What is exciting is some of the FFs who started shipping for the Phoenicians are now orgainizing around this opportunity and necessity.  The opportunity is there is more new small business worldwide, there is less big business moving things.  It only takes a 1% drop in some big business trade to open up a 1000% increase vacuum for some small business.

This is all the result of deflation.  The bad news is your pension, paycheck and property is forfeit to forces no one can control.  The good news is making a living self-employed is opening up, if you want it.



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Why USA Manufacturing Will Rebound

USA borrows half of what it spends, and has gone trillions in debt to fund wars, destabilization,  etc.  Our Keynesian economic policy, which the govt economists believe in, was expected by the powers to be to trap the Chinese: they make things for us, we pay them in funny money, they become enslaved to our funny money.

Ooooops. We went too far.  Currency needs to be tied to hard assets, money. Gold and silver.  The hegemon made a mistake.  They believed their own bad economics and redefined money and currency to help accomplish this.  Now comes this...

On March 24, 2015, Euronews broadcasted Business Middle East, in which Nour Al Hammoury from ADS securities, stated that if Chinese banks would join the new gold fix it would be less sensitive for manipulation. Having Chinese banks participate in the fix, would indeed be very welcome.

The Chinese communists know that money is gold and silver, not currency.  Note in the article the strange phrase "hyper-devaluating dollar cash-out " in the comments section.  What he means is credit deflation.

The Chinese outfoxed our economists by relatively backing their currency in gold.  USA currency is backed in fiat, asset-less nominal values.

Think Japan today.  A friend tells me Japan is 1/3rd off from last year, meaning my money will go 50% farther if I visit.  Importing from Japan just got a lot cheaper.  But his debts are all denominated in yen.  It takes fewer dollars to buy they yen to buy the same goods today as last year.

So my friend sees dollar deflation in Japan.  He feels nothing different in his life, its just it takes fewer dollars in this int'l transaction.  If and when USA products become "cheaper" more people will start making things for export.  Inside USA what dollars will be in demand will before dollar denominated debt, which people will either not take on or not be able to pay.  The demand for dollars will drop.

The implications here blow my mind, and I have been travelling, etc.  I'll work on this...

Update: as they said in the earlier point on the WIR, it is counter-cyclical.    Here is the confusion:  people think of the dollar as money, when it never was.  it is a tally of non-asset backed financials.  Think of real estate: is the bottom of the market low price?  No!  The bottom is no customers.  The dollar will not go into hyperinflation as long as it is freely convertible in to countless currencies and useful for paying debts, but it is not money, and it is fraudulent.  So it necessarily has to be liquidated, in teh sense of eliminated, at some point.    This will be well managed domestically if the WIR is allowed to grow, and it will take fewer WIRs to buy things in usa than dollars.  There it is, the deflation will be marked in USA WIRs, as the dollar is necessarily liquidated along with its bogus valuation based on non-assets plus the risible liability side of USA Pensions.  There it is...  and the Chinese are in charge now.

Ungh!  It is so sad capitalists do not understand economics as well as communists.  But neither will permit free markets.  Whaddya gonna do?  Keep a sense of humor I was advised yesterday.

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Alternative Currencies

You could not present me a more painful opportunity.   Now capitalism has had it, the worm has turned, as anyone who reads this blog regularly knows I believe credit deflation will be as dominant the next forty years and credit inflation was the last.  Credit inflation is evil, and deflation is the corrective.  This means the action of credit deflation will regress to the mean, that is to say go much farther that back to normal in its correction course.  in short, the exploiters who grew in credit inflation are going to lose more than they gained in the game.

Further, credit inflation was programmed in and managed.  Those playing that game for the last 40 years did quite well materially.  Sadly, it concentrated buying power in ever fewer hands, while crowding out the good that might have been, absent the malinvestment and misallocation of credit inflation.

But credit deflation is unmanageable.  The powers that be can do nothing about it.  You can force people to borrow by having a half-dozen conspirators cut a $4 billion bond deal to try to cut a useless tunnel through mud under Seattle, but a some point there are no buyers for the $4 billion in bonds, since the income stream to repay the bonds is doubtful.  We are there.

Unable to crush small businesses by cheapo EZ credit on long terms to buy massive quantity, and extend expensive credit to customers, McDonalds can no longer expand, nor can IKEA, or Best Buy, Walgreens or Lowes or Office Depot.  Walk through any of the above, and you can spot the problems - look how they are spacing product, the selection, and to the degree shopworn.  These stores have the wrong architecture, wrong computer systems, wrong location, wrong employees, and wrong business model for what is coming up.  Look for yourself, store closings, 2014 and 2015 already.

Look who is becoming big business: coffee and sandwich shops, liquidators and auto parts (DIY repair) and note how much the depend on overseas openings.

All this destruction at such a broad and deep swathe will create a vacuum into which small business can grow.  With credit deflation, the necessary vacuum at the small business level needs banking to match the opportunity, and even the savings and loans are out of the question...  we need a private credit (not monetary system) independent of the hegemon's lockdown, capitalist-exploitative system.  It needs to be usury (interest-free).  It needs to be focussed on members, and support manufacturing, quality construction, specialty services, the very victims of credit inflation.  it would be a good idea, but presently such initiatives are extremely marginal, like Kiva Zip and community sourced capital.

Are such efforts scaleable? Yes!

http://en.wikipedia.org/wiki/WIR_Bank

Small business, independent credit, interest-free...  founded in economic hard times...  counter-cyclical...

According to the article, interest-free for the first 18 years...

WIR was founded in 1934 by businessmen Werner Zimmermann and Paul Enz as a result of currency shortages and global financial instability. A banking license was granted in 1936.^[1] Both Zimmermann and Enz had been influenced by German libertarian economistSilvio Gesell;^[2] however, the WIR Bank renounced Gesell's "free money" theory in 1952, opening the door to monetary interest.^[3]

The article does have some questions...

Is the WIR Franc Interest bearing or interest free? The article says: "the WIR Bank renounced Gesell's 'free money' theory in 1952, opening the door to monetary interest" and then later says: "These WIR obligations being interest free have a cost of zero" Thanks! --
Is the WIR Franc Interest bearing or interest free? The article says: "the WIR Bank renounced Gesell's 'free money' theory in 1952, opening the door to monetary interest" and then later says: "These WIR obligations being interest free have a cost of zero" Thanks! --Lbeaumont (talk) 14:52, 23 January 2014 (UTC)

But that is the thing.... If you are a young scholar interested in finance, make this your phd study... as Wayne Gretsky said, "just be where the hockey puck is going next" so if you are interested in banking, study this.

For those of us in business, here is a working model we need to adapt in the USA.  This is all free market stuff, and in capitalism it is mostly criminal since the patterns and practices are against freedom, economic justice, peace and prosperity.  Just look around.

But proceed we must, and see how far an independent credit system within the hegemon's borders can go.  WE can have everything good without the hegemon's credit inflation scam, we just need freedom.

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Online World Trade Courses

If you've been thinking of starting a business, another round of online world trade start-up classes will be offered here:

http://seattleteacherscollege.net/exfoassmbu.html

and

http://seattleteacherscollege.net/tradworinnin.html


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Do You See a Ski Sweater?

Look closely, it is there....

Do you like the color?

Nothing dyed to make my sweaters.

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Switzerland Has Two Currencies

Well, here is something new...  Switzerland has had a complementary financial system to the franc, called the WIR, since 1934.

Several macro-economic studies have proven that – contrary to what people expect – this second currency contributes significantly to the stability of the Swiss economy because it is spontaneously countercyclical. The Swiss data is of great quality, and was the basis for three peer-reviewed articles by Professor John Stodder that proves this.2 While conventional money is procyclical and requires central banks to try to stabilize the economy, the WIR case demonstrates that having a business-to-business currency circulating in parallel with the conventional money actually helps the central bank in stabilizing the economy!

I wish they would call the franc currency, not "conventional money," but in any case, does this not sound exactly like what I have been saying USA once had but has lost, B2B credit?

First I ever heard of the WIR, need to study that. But no mention that Hong Kong has three competing (maybe 4) currencies, all issued by private companies, as was once the normal?  

Mentioning those community share-barter ideas, he says -

In contrast, for currencies designed to deal with social issues, what’s the point of accumulating thousands of hour credits, for instance? If your objective is to create social capital in a community, credit markets don’t make sense. It’s not the way human interactions operate. As was documented by Michael Hudson and David Graeber4, relationships based on debt have driven enslavement, the opposite of what social capital aims at achieving. 

That may be true about trading lawn mowing for babysitting, but the slavery part of debt comes from usury, and state enforcement of the usury contract.  Usury cannot exist outside of state enforcement.  At any rate, quite the contrary, relationships in which credit (and its concomitant aspect, debt) can be both unitive and creative.

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Endogenous Money?

Quite a bit here new and interesting on currency and money, but sometimes hard to divine the intent of the question when the definitions are slippery:

***do you have sympathies with the gold standard, or any other commodity standard that would obviously restrict the amount of money that can be created?***

NOw note the problem... "money" ... don't you mean currency?  The money is the gold and silver, the currency is either warehouse receipts or fractional reserve.

Or do you mean to address a notional problem of a shortage of currency in which trade is suppressed?  If the latter, I don't think you'll find an actual case in history of the same, if the question contains accurate definitions.

Graeber is half right, credit is critical in a prosperous economy, for the extractors extend credit to the processors, processors to material makers, material makers to manufacturers, manufacturers to retailers, retailers to customers, all at no interest. Contemplate the vast amount of trade done in this regime, in place a mere 40 years ago.  The fact that banks, as finally admitted by the B of E, lend asset-less backed credit, wiped all that good credit out, after Nixon closed the gold window in
'71, leaving interest bearing bad credit, is a problem.  There is never a shortage of currency, only the wiping out of the trust systems (private credit) among merchants in an economy.

The endogenous monetary system is anything offered by a state. The state currencies are the problem, the natural systems lead to peace, prosperity and economic justice.

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Ripple, The Clearinghouse

Here is an interesting currency clearing mechanism, which is widely praised, but..

This mechanism of making payments through a network of trusted associates is named 'rippling'. It is a digital version of the age-old hawala system^[20] and has been referred to as 'Facebook for money'.^{[citation needed]}

Well, no, for in hawala money is moved, not a medium 20% owned by the movers.  This is nothing like the hawala, but a digital hawala might be a good idea.

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Exporting To the USA as a Small Business

>> On Mar 19, 2015, at 1:55 AM, AT wrote:
>>
>>> Hi,
>>>
>>> I was thinking about exporting and today I watched your video on youtube on
>>> Finding Export Customer 1 2 and 3, and video about  sales agent of export.
>>>
>>> I didn't check it yet but i guess company mid sized to big business will be very interested in exporting themselves if they know how to do that.
>>> If that is right, that mean only small sized company that will be my target company to export their product.
>>>
>>> My friend family company is exporting shrimp. They buy the shrimp from local shrimp farmer, they package them with ice, and then export them. They added value, where the small local farmer cannot do that by themselves. Actually I know three to four people doing the same kind of this business successfully.
>>>
>>> I am wondering, from what product I need to start searching and trying.
>>>
>>> thanks
>>>
>>> AT

>> On Fri, Mar 20, 2015 at 1:13 AM, John Spiers <john@johnspiers.com> wrote:
>> Hey Arman,
>>
>> Take a look at what Indonesia sells to USA...
>>
>> Tell me which product you would want to sell, and why?
>>
>> http://dataweb.usitc.gov/scripts/cy_m3_run.asp?Fl=m&Phase=HTS2&cc=5600&cn=Indonesia
>>
>> John

> On Mar 19, 2015, at 10:03 PM, AT wrote:
>
>> Hi,
>>
>> thanks,
>> I am interested in 2008200090 related to pineapple < Because I like fruit and it seems growing from looking at the data.
>> 2008191040 < cashew nut seem interesting. I like nuts. maybe an alternative
>>
>> Seems garment is growing industry and many small - mid sized business in Indonesia
>> 6210405020< mens' not knit man-made fiber anoraks, coats, jackets, etc, impregnated fabric
>>
>> 6117102030.--other made up clothing accessories, knitted or crocheted, parts of garments: scarves, shawls, mufflers, etc., less than 23 percent of wool
>> << seem scarf and shawls is start growing in Indonesia export to USA.
>>
>> So  I need to choose one as my starting point ?
>> Do you have any advice how to progress from here?

> On Sun, Mar 22, 2015 at 5:54 PM, John Spiers <john@johnspiers.com> wrote:
> Yes, choose one...  if there was one you could get passionate about, even better....
>
> But the next step is after you choose one...
>
> You tell me...
>
> John

On Mar 22, 2015, at 8:50 PM, ATwrote:

> Hi John,
>
> I am interested in Men's (deleted)
>
> Thinking about mango, pineapple, nuts, not very comfortable to imagine myself doing business in that area. (need to go to the farm is not my thing)
> I can see myself have passion in doing clothing...
>
> Best regards,
> AT

On Mon, Mar 23, 2015 at 11:28 AM, John Spiers <john@johnspiers.com> wrote:

OK AT,

Now your job is to organize supply and find customers in the USA, in essence use the information you learned in class…

You'll need passion to become expert in tis narrow field…

Yu can start by studying the import data of the top six suppliers to use on the number

(deleted)

Lert me know if you need help…

JOhn

On Mar 22, 2015, at 9:55 PM, AT wrote:

Studying which countries exported most to the USA using http://dataweb.usitc.gov/ ?

March 23, 2015 5:17:52 AM PDT

AT,

Right, including indonesia....

AT, the fact is no one will be convinced they should "do business with AT..."  You have no experience, no resources...  so why should they depend on you?  You must sell them first on doing the business, then second on AT....  you must start up the same way those who have nothing get started up.

By starting with the facts regarding trade in your product between your country and several others, you will show why people SHOULD trade.  You will show people not trading right now why they should.  You see, so far it will have nothing to do with you, it is about the opportunity you show them.

Once they decide it is a good idea, then you will tell them how you can help...  and why your help is worth more to them than their money.  In essence, you'll find the USA customer, most likely an importer, but possibly a retail chain or some other buyer in USA.

AT, an agent's two most critical functions are bilinguality and paperwork compliance...  I know nothing of Indonesian export paperwork, nor much about USA import paperwork.  You need only be the fellow arranges the proper documentation in Indonesia to get the products out of Indonesia and into USA.    You will be directed as to specifics by the Indonesian Freight Forwarder to whom you brought the export business.  People will pay a premium to make problems go away.  Makers make, traders trade.

There are many moving parts to this, and you will earn your money, but the fact although int'l trade is 100% based on relationships, the basis of the relationship is the quality of the work you do (as measured in how much money people make working with you).  But to survive you must only do the work that actually pays, you must talk about opportunities and and how to solve problems, and never mind AT.

So it is very important step by step, to keep people from looking at you, and look at the facts.  This helps you too, for you never take anything personally.  It is about making the trade happen. The first step is what trade has been going on, for the last five years at what price, in this product to USA, and what is Indonesia's place within the players in world export sales to USA or your product.  

So yes, work on that spreadsheet, and if you have trouble, let me know...

Hope this makes sense...

John

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Islam On Usury

Comes a professor of Islamic finance, Prof. Saiful Azhar Rosly, who is writes English quite well, and sounds orthodox, so to speak.

There is a geography of Islamic finance, where the principles seem more or less met.

For my part, I believe a no-usury regime would advance, peace, economic justice and prosperity, and I believe the lack thereof is due to (interest) usury in our economy.

It appears in Islam one gains guidance from qualified religious leaders, although there are various schools of thought, so in effect one can be a good Muslim yet hold directly contradictory views on a topic.  Having said that, to act contrary to Islamic teaching, to be so judged, can have very severe consequences I am told.  As in Christianity, Islam has many schools, and the good professors notes three major schools on the question of riba (usury):

1) The Jabarite school of theology:: They say that man’s actions are determined and predestined by God. Man has no will of his own. He could do nothing on his own choice. Jabarites thinking is also called determinism. Good and evil are all God’s own making.. Believing in the jabarites doctrine will make an individual docile and living without hope of improving his life as everything has been decreed by God. In this manner, the jabarites are also known as the fatalist The Mutazilites protested against this belief by saying that God has given man complete power over his actions as he is free to act any way he liked. It was this freedom of choice between good and evil that man responsible for his deeds. They also say that is man’s actions were predestined, why should God exhort man in the Quran to acquire virtue. Thus determinism of man’s action is not line with the Quranic teaching.
2) The Mu’tazilites school of theology: they are guided by reason and says that man has absolute freedom of will. Man has the power to build his own character, whether to lead a virtuous or vicious life. They maintained that human reason was competent to know the verities of the universe and was completely free to go searching after the Truth. They applied reason to all truths contained in the Quran and explained away those passages that they did not find conforming to reason. They even speculate about the duty of a believer in that if he is incapable of knowing truth by reason, they would be doomed to the hell fire.
2) The ‘Asharite shool of theology: ‘Asharism is a movement that ran counter the ideas of Mu’tazilism. It aims at compromising between reason and revelation. It wants to reconcile the dictates of reason with the dogma of faith. The ‘Asharites gave authority to God and advocates the view of predestination and predetermination of man’s past activities. Man has no freedom of will, no liberty of action but has been given the power of acquisition

In Christianity, the rules are actually quite clear, and people with impunity reject them.  There is zero consequence (on earth anyway.)  100% of Catholics know that to miss Mass on Sunday is a mortal sin.  But some 70% regularly do so.  Probably some 60% of Catholics know artificial birth control is a mortal sin, but some 80% reject the teaching.  No consequences noticeable.  Maybe only 1/100th of 1% of Catholics know involvement in interest is a mortal sin.  Would it matter if 90% knew?

I mean only to compare and contrast, and note with regret in either system, it seems, the result of largely  escaped rules is somewhat equal.  People are people.

The regret then is where is the proof we who advocate Shariah and Catholic teaching compliance on usury, that is to be usury-free, is better?  We only have individual witness, not a valid and reliable scientific basis from which to proceed.  But then, perhaps that is by design, usury-free is a benefit limited to those who submit to the Will of God.

Along these lines, this professor also notes:

Surah al-Baqarah 275 says that, "Allah has allowed al-bay and prohibits riba". The question now is to whom this verse pointed at?The answer lies in the verse preceding the above according to which the disbelievers (i.e. musyrikun) says, " that al-bay is the same as riba".

This is a rebuke to possibly Moslem, but surely Christian, contemporary advocates who claim "we now know things the ancients, the Prophet, and the scholastics did not know.  The modern project is to claim  that turning a profit on a loan is no different than turning a profit on a business deal, for a loan is a business deal.  The Prophet Mohammed spurns the question fourteen hundred years ago.  That should have put an end to it, but it keeps popping up.  The Professor elucidates:

Apparently, the Quran is putting one point very straight to themusyrikun. If you have money and intends to earn from the money, do it by way of trading (al-bay') and not by making loans and charging riba on them.
The rich merchants of Mekkah (i.e the musyrikun) who relentlessly stood against the teaching of Prophet Muhammad (saw) usually make money from loans (qard) in two ways:1) making loans to the poor sorely for their consumption needs2) making loans to traders as capital

Exactly the idea in "modern economics" things are different now, and the ancients and Medievals were simply ignorant is risible.

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