There’s an old saying around the stock market: ‘Sell in May and go away’. Basically, it means that usually nothing much financial happens in the summer. This year, that might also be the slogan for a lot of other parts of society.
There is a classic John Cleese TV comedy performance, in which as “Basil,” owner/manager of a small British hotel called ‘Fawlty Towers,’ suffers a concussion then mocks German guests by goose-stepping around them, decades after World War II ended. The episode brings to mind today’s Washington, DC.
There is much made of the survival of the American system of government for 230 years under its present Constitution It has done so through many perilous situations. Today, the US has a President who comes from the personalist tradition, not that of systems.
Mark Twain liked to say that ‘History doesn’t repeat itself, but it often does rhyme’. Every hundred and fifty years, I suppose, history has to start to rhyme in the United States. In 1865, a popular President was succeeded by a President who had no clear mandate, who was blustery and not a part of the then Establishment.
There are a lot of rough parallels between events in history that suggest that what one generation learns is forgotten over time. One of these is between the political/financial events in the United States between 1830-1850 and 2000-2020.
During America’s Ronald Reagan presidency, the phrase ‘starve the beast’ was shorthand amongst conservatives for the idea that by simply cutting back on expenditures — either through disciplined spending or by giving money away through tax cuts— people would be forced to accept smaller and less expensive government. It didn’t really work — but the idea persists, on the “left” and the “right.”
To be Dickensian, it is the best of times and it is the worst of times. There is a lot of speculation that maybe America’s new President won’t really do what he said he would do. I wouldn’t bet on that.
My wife and I like to watch British mystery shows, some of which feature female police officers in senior positions. Invariably, the subordinate officers respond to their advice and orders with the response of, ‘Yes Ma’am’. Maybe we’d better start getting used to this in North America, once Hillary Clinton takes office.
There seems to be a concerted effort worldwide to link all kinds of jurisdictions in Cap and Trade systems, a kind of global trade zone for controlling greenhouse gas emissions. And this kind of trade seems to be on the side of the angels, where buying and selling stuff is not.
One of the American presumptive presidential candidates has been creating a big nationalist fuss about ‘Making America Great Again’. Somehow, according to this interpretation, the country’s just not given the respect it had in the past, perhaps in the 60s and 70s, when the Boomers were growing up, or maybe even going back to 1945 and the end of the Cold War. Maybe it was in some mythical era when the country was the big boy on the block, 1900 perhaps, or 1920….
The Islamic State “Caliphate” has been reduced to three major urban areas, Raqqa, Mosul and Falluja. None of them have dependable resupply routes for either military goods or civilian needs. Short of their opponents falling into disarray and not pressing on, an unlikely hope this close to the end, things for ISIS can unravel simply by waiting. So, what comes after the Caliphate?
Sylvester Graham and William Andrus Alcott were men of their disease-ridden times, amongst the first American promoters of “health food,” “phys-ed” and temperate living for health in both the here and now — and the afterlife.
The lesson from historical events: do not bet against whatever side the United States is on in a long-run Cold War. It is the acknowledged ‘champion’ of Cold Wars and will not give up its place in the face of Wahhabi/ Salafi/ Al Queda/ Taliban/ Islamic State, etc. pressure any time soon.
Current political campaigns in the United States reveal how much elections are being disrupted by the same forces that have made a mess out of everything in society, from book and newspaper publishing, to overnight rentals to retail sales.
There is a point in each Canadian winter, as the cold sets in following December’s holiday season, that Canadians start to dream of warmer weather. Soon, the annual ‘snowbird’ migration begins to the American south. This is the story of how their destination came to exist.
The future may contain two ‘dragons:’ the known one of inflation and the one known in theory but unknown in combat, that of deflation.
As a global society we are slowly beginning to explore a couple of the ‘known unknowns’ that need to be managed right.
Forty-seven years ago in the United States, the Democrats found themselves going into their Presidential nomination process rather at sea. Does this sound familiar? Does it look like a mirror image of today? Today it is the Republicans who are in disarray. And it all has to do with the boomers.
In the late 1880s, a mysterious stranger, said to have come from the West, appeared in Niagara Falls and began to scout the opportunities there. He was taken with the power potential and with the possibilities for land speculation…
There is another crisis brewing on the debt front. This one has to do with the public debt of entities that are part of wider currency zones: Greece, Puerto Rico amid the United States, and Ontario, in Canada.
There were reasons why Sam McClure’s low-cost, good quality magazine sold well in the tough economic climate from 1890:: cheaper postal rates and rural delivery; new technology including high-speed presses and halftone photoengraving; and a growing demand for low-cost outlets for advertising. McClure’s also innovated with an in-house staff of writers and editors.
A week short of a year after America’s entry into World War II, on December 5, 1942, an enemy alien set off a nuclear reaction about five miles south of the Loop in Chicago. An Italian scientist, and Nobel Prize winner, Enrico Fermi, directed a team of scientists, casual and construction workers and military personnel in the building and operation of the world’s first attempt to generate a nuclear ‘critical mass’. The makeshift reactor was built in a squash court underneath the Stagg Field stands at the University of Chicago. Fermi had fled fascist Italy when Mussolini began to imitate Hitler’s anti-Jewish laws, as his wife was Jewish. They had not been in the United States long enough to qualify for American citizenship and Italy had been at war with America since mid-December, 1941.
Robert Goddard was the quintessential Yankee inventor. Born in 1882, he was raised and lived much of his life in Worcester, Massachusetts. Goddard was a sickly boy who fell behind in school and did not graduate until he was twenty-two. Spending lots of time home in bed, he became a voracious reader, and was highly taken with H.G.Wells’s War of the Worlds, which was published when he was sixteen. At seventeen he discovered his life’s work while staring at the sky as he pruned trees around his parents’ house. He would devise a way to escape Earth’s gravity and travel through space.
America’s Baseball Hall of Fame in Cooperstown, New York, is a standard tourist trap: an attraction surrounded by a large number of related souvenir shops and restaurants. In the 1930s, the baseball establishment accepted Cooperstown as the place where Abner Doubleday supposedly devised the rules of the game in 1839. The attribution of Doubleday as baseball’s inventor was made on very improbable evidence, however. The Abner Doubleday — and there could have been more than one living in upstate New York at the time — was a noted Civil War general, but in 1839 had been a cadet at West Point and unable to leave its grounds.
In 1887, Edward Bellamy, perhaps one of the last of a long line of Yankee utopians, published a book called Looking Backward. In it, his character, Julian West, falls asleep in a secure basement room in his house in Boston in that same year. West is awakened in the year 2000, to be greeted by Bostonians who are living in a world at peace, with prosperity and full of the benefits of equality. The book became very popular in its time and ‘Bellamy clubs’ sprang up to promote his ideals. Here, we want to look at the technology that is incorporated in some of Bellamy’s social theorizing.
At the age of 18, in 1933, the charming and restless Patrick Leigh Fermor decided to walk alone from the Hook of Holland to Istanbul. The books that came of that journey, much later, exude feeling for the gradual tightening of the totalitarian state being devised by Hitler, a post-mortem on what was left of the landed aristocracy in Eastern Europe following World War I and the antagonisms between the welter of peoples in the successor states to the Austro-Hungarian and Ottoman empires.
I don’t know where the next debt crisis is going to come from, but I’ve got some good possibilities. When it does come, the big problem will not be the lenders or taxpayers who will get stiffed, more or less, but whether the crisis can be contained. What I mean is that when some kind of borrower, be it a state or a corporation, defaults on its financial obligations (bonds), other lenders will look around, find similar organizations in the same shape, and try to get their loans paid back immediately. This is not likely to be possible, even for the best of borrowers so, like a row of dominos, they will begin to fall and fail. This is called ‘contagion’ in the business. On a global scale, contagion can lead to an economic mess much more serious than the United States crisis of 2008.
The War of 1812 and The Yankee Roads: a three part series
Warfare between Great Britain and America came to its legal end 200 years ago, with the ratification of the The Treaty of Ghent on February 16, 1815. Public and official interest in the bicentennial of the War of 1812 in Canada, the United Kingdom and the United States, has been mostly muted, despite an official effort to play up the War in Canada. Yet big things came out of this standoff. One was the eventual creation of Canada as a country separate from America. The second was the destiny of the Yankee exodus westward and the outcome of the Civil War.
America did not need control over the lower Great Lakes to access their communities to the extent that the British did, except for two spots. The first was the Niagara area, where inconclusive battles were fought mostly on the British side. The second was the western end of Lake Erie and its feeder, the Detroit River. British control over Lake Erie meant that American troops and supplies could not be brought far enough north on land from Indiana to allow them to support Detroit and control the Upper Lakes. As well, the British Fort Malden at Amherstburg controlled the shipping channel in the Detroit River.
Both sides ‘won’ the war of 1812. Only the Indians lost. With the loss of the Battle of Lake Erie, the possibility, envisioned by General Isaac Brock, that an Indian buffer state might be created between the United States and Upper Canada disappeared. Then, when Tecumseh was killed at Moraviantown, the only leader that might have made it a reality was lost. The tribes sank into passivity and American settlement in Indiana and Michigan moved forward. Many of these native people moved into Canada, away from American treatment. The southern Indians, put down by Jackson, soon found themselves pushed west along the Trail of Tears or shoved southwards through Florida into the Everglades. With the exception of a decade of Sioux resistance after the Civil War, none of the so-called ‘Indian wars’ after 1815 amounted to much. It was over.
I knew Cuba in the old days, before Barack Obama unleashed the second American invasion of that Caribbean island. This invasion is not a military one, but one far more complex and fraught with misunderstanding. Cuba is not Puerto Rico, neither for tourists nor for businesspersons.
The American and Canadian economies will do well this next year, especially the American. Their consumers, who represent over 70% of that economy’s GDP, should begin to shed their uncertainties and the Federal Reserve won’t raise interest rates. The Canadian economy will go into an election year with the outcome looking close, which means Canadian austerity will relax and its consumers, only representing 50-or so per cent of that economy, will get some breaks. The biggest break for both countries is the collapse of oil prices, which is likely to persist for some years, well after the initial sigh of relief has disappeared from the consumers. It is like a nice, ‘progressive tax cut’ in both countries. Numbers like $750 billion are bandied about in the U.S., a lot more than any Congress could deliver. On top of this, there is a ‘goody’ coming to the travelling well-off, including seniors.
The Global Implications of Oil Renormalization: a three part series
To understand the global oil market, it helps to grasp the history and makeup of the commodity. In North America, from time immemorial, the Indians in the Western Allegheny area had skimmed oil seepage off the surface of the water and used it as a medicine. The settlers called it ‘Seneca oil’ after the local tribe, and used woven cloths or skimming boards to get the seepage off the water’s surface. Some entrepreneurs began to bottle and sell it as a cure-all. According to one version, “se-nay-kah’, as it was pronounced, oil entered the American popular vocabulary as ‘snake’ oil.
Attempts have been made since 1859 to control the price of oil — or, rather, the price of its refined product, be that kerosene for lighting or, later, gasoline for autos. The first one to try was John D Rockefeller with his development of the Standard Oil Trust in the 1860s and beyond. OPEC, or the Organization of Petroleum Exporting Countries, is the latest attempt, dating back to the 1960s, and is based on the export of oil by the global low-cost producers, in particular Saudi Arabia. In effect the Saudis, as price leaders, try to keep the price stable by varying their own production and pricing, so as to discourage its partners from overproduction or short-term greed. Generally, when prices are high their cheating is rampant, and when prices are low their cheating is rampant. Well, here we go again.
It has been 155 years since a commercial quantity of ‘rock oil’ was found. Through much of that time, uses for its refined liquids gradually expanded, from lighting to fuel oil to gasoline and the automobile. Gradually petroleum became the energy source of choice, though coal and natural gas were large competitors. During World War II, the Allies recognized that control over oil reserves was critical to success on the battlefield, but it was not until the 1970s that the world realized that oil supplies and prices were now one of the determinants of prosperity.
The popular media, always looking for the next big thing, has fastened upon the swift victories and social media brutalities of the group calling itself Islamic State. The various media have portrayed the organization as a worldwide threat and a number of governments have organized themselves to deal with it, led by the United States. You have to read between the lines on this one. First, this terrible threatening force is actually weaker than the Taliban force that was over-running Afghanistan in 2002.
The Future of the Global University System, a three-part series (public access)
You have to look at universities without their trappings of tradition, semi-mystical feeling and notions of honours and awards. See them instead as not-for-profit education institutions in an age where information is rapidly becoming democratized and commoditized (like hogs and logs), or as a single global information business subject to the same forces affecting all global information businesses today, from banks to Twitter. The university model romanticized by many academics — Socrates imparting wisdom to a half-dozen students while sitting under a tree — is a ‘handicraft’ cultural dream. Does this mean the emerging network society will exercise a similar effect, leading to a new model for higher education?
The global university system cannot continue in its current form. There is a drastic way out: jettison the research subsidies of universities and divorce research from teaching.
As with electronic journalism, music, entertainment and books, the challenge to anyone wishing to provide global university education is how to monetize it. Nobody can predict how the global university system will look in the future, but it is not hard to see that one will emerge in the great by-and-by.
Every developed country except the United States is sliding gently and quietly into a condition that we know almost nothing about. It’s really pretty simple. In order for a society to reproduce itself, each woman must have 2.1 children during her fertile period, which normally lasts from, say 14-42 years of age, more or less. This is called a fertility rate, as opposed to a birthrate. A stable population fertility rate is reached by counting one for mommy’s replacement, one for daddy’s replacement and 0.1 for misfortunes. Today, any growth in most country’s population is due to immigration.
For 40 years, one big contest played out in the world. It was a kind of arm-wrestling match between the Soviets and the Americans. I use the word ‘Soviets’ to distinguish one contestant from its successor of sorts: today’s Russians. Eventually, the Soviets could not keep their end of the game going and walked away from the table, into history. The last decade of the century was one where there was but one superpower — and it wanted to party. The attacks on America on September 11, 2001, brought that party to a halt. It signified a new game was beginning; not one of two superpowers engaged while the rest of the world largely stayed out of the way, but one where arm-wrestling was replaced by a kind of hide-and-seek.
Michael Lewis’ latest book,Flash Boys, is the 21st Century version of the story of those British financiers who lost out to Nathan Rothschild in 1814, and of their attempts to figure out how Rothschild did it. Today, semaphores and carrier pigeons have been replaced with fiber optic cables and microwave towers. There is nothing illegal in getting to the market microseconds ahead of the other guy by using up-to-date technology. And yet, in the aftermath of the trauma of the crash of 2008, the unethical and the illegal easily flow together, especially when the risk is of another crash.
Mimi’s is a restaurant chain in the southwestern United States that my wife, Jane, and I like for lunch. It has a good soup and sandwich combo within a kind of French décor. Last week we went there for a bit of a celebration, of my signing of an agreement to publish a book, The Yankee Road. The reason for mentioning the lunch is to mark my experience with book publishing — and how it has changed and is changing as Moore’s Law and Jeff Bezos keep changing it.
The application of research and science to human work behaviour is so much a part of our lives that we hardly notice it today. It has led to a system that produces and distributes more goods and services to everyone than has ever been seen before. Without Frederick W. Taylor’s application of experimental research to the problems of production in the late 1800s, Henry Ford could not have created his version of the assembly line, Ray Croc could not have developed McDonald’s systems, Ray Walton could not have developed Wal-Mart’s logistics — and so on.
When we read about the Great Recession of 2007-11, there seems to be an assumption on the part of commentators that as soon as the economy ‘turned around,’ we could get back to normal. That’s not how it is turning out and that should not be surprising. There is no going back.
Quietly, except for a spate of new history books and the odd movie or two, the 150th anniversary of the United States Civil War is sliding past. It was a war that dragged on for four years and cost the lives of 600,000 to 700,000 people. It was the first of the technological total wars that later marked the 20th century …
The great French historian, Fernand Braudel, saw capitalism in its basic form as the injection of capital between the actions of buyer and seller. This is both simple and profound. It explains the difference between a farmers’ market and a supermarket. In the former, the producer/seller and the buyer meet face-to-face for the exchange. In the latter, the producer sells to an intermediary, who then may process, transport and resell the good to a supermarket chain that, in turn distributes it and resells it once more to the final buyer. Capital is used to conduct the producer/buyer economic relationship at a distance …
Chances are, you’ve never heard of any of these guys. They changed your life in the past decade and you may never have seen any of it. That’s OK, because almost no one else did either …
My wife and I spent a couple of months in the American Southwest last winter. We stayed out on the edge of the desert near Tucson, Arizona. It is dry, hot and utterly unlike where I live, in Halifax on Canada’s Atlantic coast. Our two married daughters, twins, came down together to visit, bringing one’s 9-year-old son. The three women were keen to explore shops and galleries and a mother-daughters expedition was formed. I was designated as official entertainer of the grandson …