Jan 202015
 January 20, 2015  Posted by at 11:08 pm Finance Tagged with: , , , , , ,

Unknown Charleston, SC, after bombardment. Ruins of Cathedral of St John and St Finbar 1865

After 6+ (BIG +) years of deepening poverty and rising stock markets, of creative accounting, of QE and ultralow interest rates, of extend and pretend and outright propaganda and of what have you, all of which have led us to where we are today, facing yet more rounds of stumbling from crisis into multiple crises, it would seem clear that the model, if not the mold, is broken. In order to fix it, let alone replace it altogether, we need to understand to what extent it is broken. And to do that, we first need to know what exactly the model is.

Now, it would be tempting, even seem logical, to consult with the people who designed and built the model. Who, after all, not only claim to be the only ones capable of fixing the broken mold, but who also have occupied all positions of power that have any say in the process. But that’s less obvious than it may seem. Because, mind you, the model is broken. They built a flawed model. Or rather, they built one that works for them, for some, but not for the rest of us.

There are gatherings and festivities ongoing in Davos. Only some are invited: the rich, the powerful and their court jesters. Those who profited most from the broken model. They’re least likely to fix it, they won’t even admit to it being broken. It works just fine for them. The people in Davos believe in one model only, the one of ever increasing centralization and globalization, because that’s the model that got them where they are.

That means that what’s in their interest is 180º removed from what’s in your interest. And it means that whatever these people propose you do, you should probably do the exact opposite.

The more our economic activities become part of the global economy, the more the rich can skim off. That ‘principle’ got them where they are. They all, to name one thing, keep talking about the need for more reforms, in order to make economies more competitive. Even sounds reasonable at first glance; but only because we haven’t thought it over. It’s mere propaganda.

When it comes to basic necessities, to food, water and shelter, we shouldn’t strive to compete with other economies. That is not good for us, or for our peers in those other economies; it’s good only for those who skim off the top. The larger and more globalized the top, the more there is to skim off. All the ‘reform’ is geared towards making our economies ever more dependent on the global economy. And that is not in our best interest.

It’s not all just even about money, it’s about our security, and independence. Everybody likes the idea of being independent, but at the same time few realize that globalization is the exact opposite of independence. Global trade is fine, as long as it’s limited to things we don’t need to survive, but it’s not fine if and when it takes away the ability of a community or a society to provide for itself.

Protectionism has acquired a really bad reputation, as if it’s inherently evil to try and protect your community from being gutted by economic ideas and systems it has no defense against, or to make sure it can generate and provide for its own basics at all times. But that’s just propaganda too.

If our societies are not designed and constructed to provide for themselves, they’ll end up with no choice but to go to war with each other. Along the same lines, if our societies don’t have strict laws in place that guarantee we can’t and won’t destroy the natural resources of the land we live on comes with, we’ll also end up going to war with each other.

We’re not going to solve the Gordian knot of the entire global economy and all the hubris and propaganda the present leading politicians, businessmen and ‘reporters’ bring to the table. And we probably shouldn’t want to. Our brains did not develop to do things on a global scale. The clowns will blow themselves up sooner or later. We should focus on what we can do, meanwhile, in our immediate surroundings.

And it’s pretty easy from there, really. The economic problems we have are mostly artificial. They have been induced by the broken economic model the Davos crowd, the central bankers and you know who else would have us believe is the one and only, and that they are busy fixing for our sake and greater glory. But they care only about their own glory.

The IMF lowered its global GDP forecast yet again. But who cares? Who has any faith in the IMF? Those numbers are released for consumption by the masses, and duly reported by the media six ways to Sunday. China says its economy grew 7.4% in 2014. But there is no more reason to believe China than there is the IMF. If China’s economy had really grown 7.4% in 2014, oil would not be below $50.

Trying, and desiring, to be part of this global economy idea the clowns propagate, or even a new world order, which can only lead to misery and mayhem for billions of people just because of the way it was set up, is the worst thing we can do now. We owe it to our people, and our children, to leave them with something better than that.

It’s fine to compete with others when it comes to technology and fashion and gadgets and whatever luxury items you can or cannot yet imagine. But it’s not fine to compete with them for the food and water your own children will need to survive. But still, that is the path we’re on. The path the Davos crowd has set us on. Because they get richer as we compete for food and water. Divide and rule stems from Roman times, if not before. And ‘we’ – or they, if you like that better – have perfected it. To the extent that we are now so divided amongst ourselves that a small minority can see its wealth grow at ever increasing speed at our cost.

The Davos crowd are not the important people, it’s just propaganda that makes you see them in that light. There’s no glory in wealth. The important people are your neighbors, your families, and most of all your children. And the answer to their insidious schemes is really simple; its that very simplicity which may well be the reason you never saw it.

You see, a dollar spent on locally made products goes much further than one spent on products that are shipped in. About 4 times further. Because if you buy local products, you support local jobs, which in turn support the community you live in through taxes that pay for strengthening the community, and so forth. Ergo: if something produced locally costs twice as much as what’s available from 1000 miles away, you’d still be better off. Even if it’s three times more expensive, you’ll still end up richer.

The only setback is, you’ll have to work to make it work. You’ll have to get people around you to understand why buying what their neighbors make at double or triple the price of what they pay for what comes from China will make them richer and better people. Sounds stupid and naive and easy to dismiss and unrealistic at first bite, I know. But I don’t mind, because I’m none of those things.

And, moreover, this is the only road out of Davos. All you need to do is wean yourself off the clowns. And I know you can’t do it alone, but then, why should you want to?

Home Forums The Only Road Out Of Davos

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    Unknown Charleston, SC, after bombardment. Ruins of Cathedral of St John and St Finbar 1865 After 6+ (BIG +) years of deepening poverty and rising sto
    [See the full post at: The Only Road Out Of Davos]


    How long do we have “to get people around you to understand why buying what their neighbors make at double or triple the price of what they pay for what comes from China will make them richer and better people”?


    I think a lot of older people still understand this point. We remember making things and getting paid well for it. We remember when “Buy American” would have been a nonsensical slogan. (Duh! What else is there?)

    Younger folks who have grown up with pure Free-Trade propaganda don’t understand. They are told to imagine higher prices as the penalty of Protectionism, and they are correctly repelled by that side of the equation when presented on its own. They aren’t allowed to imagine receiving more money in their paychecks.


    I always ask where things are made. I can’t always avoid a ‘good deal’ but I try to buy North American. I bought Stanfields undershirts (made in canada) last year, I paid $35 instead of $20. That adds up when 5 packages are required.

    I choose to support North American vendors/manufactures when purchasing products for our company. We all know know volume goes to China, but they can’t compete on lead time or customization.


    It really is a different economy now. Central banking actions just encourage an increase in the cycle speed of boom to bust. The bubbles in beween are feeding frenzies for the financial class. QE is the active transfer phase of public to ologarch. By design or by acident, it is an acceleration of the return to two class society. Nuclear weapons keep the disruption of war far enough away to keep the upper class intact. At some point the model will break, either by war, climate change, pandemic, perhaps all of the above, leading to collapse. The more complex a network is, the more prone it is to sudden and total collapse. It’s hard to think it could get more complex than today. It is a very dark future ahead.


    Nice. Thank, Ilargi.

    I always feel I should be amazed when some body like the IMF lowers (or, perhaps occasionally, raise) their forecasts. It shows that they got it wrong the first time (and probably the second and third times) but the economists (and others) still lap up their every word as though it was gospel. They have very poor memories.

    Chris M

    Ilargi. Excellent article.

    I have once read that there is no basis for free trade at all. I have also read that free trade is for speculators and predators. Still more, I have heard it said that the high market buys cheap until the very process pulls down its standard of living to comply with world standards.

    Furthermore….”A nation that degrades either the production or the income of its agriculture thereby condemns itself to war.”

    You are right. Protecting your community from being gutted by economic ideas and systems is not evil at all. To protect is to love. Protecting your friends and family from those who kill, rape, and injure is just as righteous as protecting them from the economic killers and rapists. These evil people have worked hard through their propaganda machine to make protectionism sound evil.

    It is good to trade locally, as you say, but it must be done fairly–with fair prices for goods and labor. The price of local goods that is two to three times the price of goods imported may be the right price, only because the imported goods have been produced by cheating the laborer and/or “cheating” the environment.

    This only sounds stupid because our children, and our population, for that matter, have not been taught adequately about economics and money.

    I always liked what John Stuart Mills said:

    “Distribution in an institutional world had nothing to do with economics. The distribution of wealth depends on the laws and customs of society. Society decides how to share the fruits of the land–this fact moves the debate from impersonal and inevitable law to the arena of ethics and morality.”


    Hah. Obama has declared the financial crisis to be over, in his SOTU speech. Well, there you are then. All it takes is a declaration by the boss man.

    Chris M

    Well, you know, Tony Prep,

    as Han Solo said to CP3O, “I’m glad you’re here to tell us these things.”



    Well, there you’ve gone and done it. You’ll more than likely be added to the list for calling out the Predator Class for exactly what they are: a giant skimming operation. The international criminal cartel of the elite few who are now untouchable. Yet the peons turn on each other. It would be almost funny if we were not such an integral part of the scam.


    I would be interested in obtaining more info on the statement:
    “You see, a dollar spent on locally made products goes much further than one spent on products that are shipped in. About 4 times further.”
    That is an extremely useful argument, but if I use it, I will need to substantiate and document it. So, any bibliographical references?
    Thanks in advance,


    Trade Agreements:

    “With Republicans regaining control of Congress, the Democrat establishment is scrambling to claim ‘political’ differences while President Obama and Congressional Republicans promote nearly identical economic agendas through trade agreements. […]

    Of what value is Mr. Obama’s (nominal) support for raising the minimum wage if the trade deals he is promoting are designed remove the civil capacity for setting a minimum wage? What credibility do Mr. Obama’s environmental policies, such as they are, have when he is actively working to subvert the capacity for civil environmental regulation through trade deals? […] And with the TPP and TTIP Mr. Obama is trying to complete the circle— a specific purpose of the agreements is to replace civil governance in the public interest with supranational governance in the ‘private’ interest.”


    From my reading of the upcoming trade agreements, it appears some countries are almost being bullied into signing, or maybe they’re just waiting until the bribes gets big enough. This world is completely insane, thanks to our leaders. Fight these trade agreements because their supranational courts (run by corporate insiders) will override what little sovereignty we have left.


    XYZ, it’s from research I read maybe 10 years ago, by a female economist. Haven’t found it back. Maybe I should look harder. Or maybe you can help 😉

    I find it strange that I don”t come across a lot more literature and research on the topic. The gist is very simple and easily understood: if the baker pays the butcher pays the carpenter pays the farmer pays the baker with the same money, and nothing is taken by people outside the community, everyone MUST get richer than when part of the money does vanish. That means, at some point, that you’re running to stand still. Or worse, as in today’s societies. That easy to grasp principle is more interesting to me than exact numbers, but let’s see if we can find more on this.

    Take WalMart as an example. their costs are – broadly – purchases, transport, real estate and employees. A one-off profit on a building may – or may not – go to the community. That leaves only low-paid employees as ”beneficiaries” of the store’s turnover (plus a whiff of local veg – maybe-), while in many towns a substantial part of available money is spent there, that the store doesn’t spend back into the community. It’s how Sam Walton got rich. And you got poor. And how we got so many shitty jobs.


    XYZ… web search the phrase “$1 spent locally”….plenty of info available.

    Chris M


    Abraham Lincoln was asked whether we should import steel from Europe to build our railroad system, or whether we should produce the steel ourselves. He said something like this: I don’t know much about rails and tariffs and I don’t know much about railroads, but here’s one thing I do know. If we produce the steel ourselves, then we’ll have both the rails and the money.


    Check out Local Dollars, Local Sense by Michael Shuman (Chelsea Green, 2012)


    Thanks for the info on local spending.

    Raul, I understand the concept, it is simply that some factual data to back up the argument is always useful.


    Doc Robinson

    From the aforementioned book, Local Dollars, Local Sense, by Michael Shuman (Chelsea Green, 2012):

    “Every job in a locally owned business generates two to four times as much economic development benefit as a job in an equivalent nonlocal business. Local businesses spend more money locally, which helps to pump up what is known as the local spending multiplier.” (p. 18)

    Table 1 (on page 19) lists an average “Local Jobs Advantage” of 2.6 resulting from studies done for various cities. Quoting the book again, “The local jobs advantage represents the relative number of jobs (direct and indirect) produced by a given purchase (say $100) from a local business versus the same purchase from a similar nonlocal business.”

    Local currencies could take this further, as they generally cannot be spent outside the local area.


    There is an important thing about Americans that has to be understood. Americans have always been eager to kiss the ass of the well to do and the more well to do the more eager they are to kiss. There are two principals involved I think.

    One is the prevalence of thread of Christianity normally associated with Calvinism which suggests the rich are better. Their earthly reward evidence of God’s favor. This sort of thing is embedded in the culture , rarely if ever stated directly or indirectly and it’s religious root forgotten but take my word for it as an American, it’s there.

    The other is strictly secular. That is if your nice and defer to the wealthier then maybe some of that wealth will flow your way. It is pure self interest. At a minimum you don’t want to be on record as being critical of them. De Tocqueville in Democracy In America commented on this and thought it unseemly. He was an aristocrat who was skeptical of Democracy and believed in well defined social classes. He maintained that this eliminated such petty self interested sucking up to one betters and striving which resulted in more honest social relationships.

    The point is nobody is anybody or who wants to be, in America, is going to be dumping dirt on the denizens of Davos.

    There is another thread in American culture where nativist populists of the right, which was always the largest group of American populists, always hated big money financiers. Well they did until Reagan. Now in America the huge rightest movement lead by a sprawling and diverse media presence is all in with the uber rich.


    From Acting-man.com 21 Jan.
    The Fat Lady is Clearing her Throat


    >>And to do that, we first need to know what exactly the model is.<<
    The model is Debt Money Tyranny – the one subject you seem unwilling to touch even though 5th grade level math proves the prima facie fraud of the system.
    If Banksters generate $20 for society based on 5% debt, then society owes the Banksters $21 in a year’s time, BUT SOCIETY ONLY HAS $20. The debts are inextinguishable.
    That’s the math that underlies Henry Ford’s observation…

    “The one aim of these financiers is world control by the creation of inextinguishable debt.”
    ~Henry Ford

    There is a reason they call the debt paper associated with the generation of money “bonds.”

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