GuidoWorld

Anyone who has ever taken out a loan knows the importance of interest rates. Whether the loan be for school, home, car or business  “a good rate” can make all the difference. Even though much has been made of the high debt load of the US our historic low interest rates hovering near zero have made it serviceable. If interest rates were to rise even a little bit, our debt load would quickly become unmanageable.

Almost immediately after the S&P downgraded the US from its AAA rating the markets began to plummet. In essence that was like the entire nation getting a lower credit score and a signal that higher interest rates for our national debt were on the way. All eyes were on the Fed to see how it was going to respond. The Fed surprised a lot of people and said little in direct response to either the market, quantitative easing or the integrity of US debt, instead the Fed pledged to keep interest rates at near zero till at least 2013.

Historic low rates and floods of easy money have been behind the stock markets meteoric rise over the last two years despite a moribund rebound in the consumer economy. The Fed’s assurance of low interest rates through the middle of 2013 along with the rising of the debt ceiling through the same time period should give an all clear to the stock market if the European financial systems can avoid a meltdown.

Though the pledge of low interest rates may reassure the wealthy that debt won’t kill the flow of easy money, it will force many safe investors on a fixed income into the risky casino of the stock market. The certainty of low interest rates means that those with conservative safe investment and retirement portfolios may not be able to live or survive on the interest alone, thereby resulting in their putting larger portions of their retirement and pension funds into stocks in search of income to maintain their life style or avert the possibility of their outliving their savings.

For a more in depth analysis of the ways in which the Fed and our economic policies are making life miserable for retirees read the following:

BERNANKE PLEDGES TO SCREW YOUR GRANDMOTHER FOR AT LEAST TWO MORE YEARS

 http://www.theburningplatform.com/?p=199…

The market pundits and media could put up a rather convincing argument that the recent “crash” has already “priced into the stock market” a European financial meltdown and the prospect that “we’ve already entered a double dip recession”. Any data or announcements which indicate that Europe and the US economy are not as bad as recently advertised could result in a market rally and the official proclamation that the “economic soft patch” is over and the recovery is back on track. In that case a quick and strong market surge could begin which along with the dashing of any hopes of higher interest rates for those on a fixed or limited income, could entice/force those who have been risk aversive back into the stock market.

Then, soon as any recession data returns or another round of financial issues surface the stock market will tank even quicker and stronger than the last few weeks, resulting in a return of the bear market begun in 2007/2008. In this very likely scenario those coaxed and forced back in the stock market will be devastated. This means that not only will granny lose her last pennies, but those who missed out on the last stock market rally and who have been coaxed back in by the Fed’s last move will once again see half or more of their savings/investments evaporate.

Making matters worse is the likelihood that the last two year rally will prevent them from selling as the market goes down, for they won’t want to miss the next rebound. The problem is the rebound may not come this time. The same thing happened during the last great depression. The stock market crash of 1929 was not when most people lost their money, but after the rebound in the early 30’s followed by the real prolonged crash of the market.

So, those on a fixed income will lose their remaining money either through not receiving interest they are depended on, or in the stock market where they are attempting to make modest gains to supplement their lack of interest. Those who aren’t retired but are below or near where they were before the stock plunge of the 2008 recession, will either continue to stay out of the market or get in and get mauled in the next leg down in this bear market.

The transfer of wealth from the many to the few is about to pick up momentum. The coming deflationary depression will accomplish much of the same as the depression of the 30’s. A few entities will win the great game of monopoly and but up every thing at much lower prices. The great majority of people will be wiped out and be struggling to get by for decades while the handful of winners make the current billionaires look like paupers.

The common man will have no recourse. Very little of the money which was taken out of their paychecks for social security and medicare will be returned. Workers rights through the decline of unions and collective bargaining will be hard to rekindle. The great war machine of the military-industrial complex will continue to centralize power and wealth, and make most forms of protest or political discussion illegal and punishable.

Those who own debt such as the Fed and other central banks will not likely ever be repaid, but when the smoke clears they will own most assets, real estate and businesses around the world. At some point they will probably give up the ghost of trying to get loans paid off and find some way to forgive all debt. This has been done numerous times throughout history and even has a name for the occasion (Jubilee). After all is said and done money is an abstraction, but ownership is true wealth, and those who own the debt own the assets behind the loan.

Could I be wrong. Of course, I could be wrong. Yet, from a historical point of view this script has played out a number of times, and we all know the folly of thinking “this time is different”. The only way it will be different is if we make it different. Yet, at this moment I do not see any sign that we have the courage or insight on how to alter the unfolding script.

The combination of technology and globalism make it possible that this depression could be the most intense and severe of any on record. Will we end up in a return to Feudalism, or in a world similar to Brave New World or 1984? Perhaps.

Each previous global empire has fallen, and each previous monopoly game has resulted in new societies being formed in which the game begins again. Yet, sometimes there can be lost decades or even centuries before a revival. The scariest thing of this monolith is how efficient is its ability to monitor, survey, and shape perception.

Yet, the obvious question most of you are asking is what can be done? Well, we have missed a myriad of opportunities over the last few decades. Since the coming deflationary depression is weeks or months away from taking hold of the global economies there is almost nothing to do in  terms of prevention. The snowball is already careening down the hill, and the best we can hope for is not to be in its direct path.

Okay let’s take a look at what you can do in the short and long run to help yourself not only survive but actually improve your situation in the coming economic tsunami.

If possible get out of debt or at least continue to pay down your debt
On a political level stand up for the rights and freedoms of the little guy
Let Godzilla and King Kong do battle, but don’t get to close, or choose sides
Get out of the market and go to cash

To expand on the above points I’ll just say the following. People who own your debt own your possessions, rights and control your future.
On the level of regaining our rights and freedoms read my post 2nd Bill of Rights, or Google FDR’s second Bill of Rights. This would be a good start in terms of making sure that all citizens are treated with respect and dignity and not punished if they are not gifted, ambitious or ruthless. There is safety and power in numbers so embrace the little guy even if he’s a tad flawed or obnoxious.
Since so much wealth and power is at stake as the titans clash, it is best to get out of the way when untold trillions of dollars get lost and ownership goes to the last man standing.
Probably the last of my four recommendations is the most important. During a deflationary depression a great portion of money disappears as unserviceable debt gets wrung out of the economy.
In deflation wages and prices plummet kind of like what is happening on a relatively small scale in the housing market. During this time the buying power of money increases dramatically, whereby a thousand dollars today will buy 6 to 10 thousand dollars of goods then. A person worth $200,000 who keeps his money safe and out of risky investments will be able to live the life style of a person with assets over a million today. In other words as the money pool shrinks the relative worth of those not losing money skyrockets.

Let me address two other popular options often given to people looking to be winners during a severe economic downturn. One recommendation is to take advantage of a falling market and to short stocks. The second is to own gold, which is and has historically been viewed as real money.

An investor “shorts” a stock or the market when they feel the stock price is going down and not up. Since stock markets often go down faster than they go up, a good timer of the market can make substantial amounts of money in a very short period of time. Yet, shorting the market is highly dependent on smaller time frames and money made can be wiped out completely if the market has a rebound within the context of its overall decline.

Yet, even a vigilant and talented market timer can be thwarted by new rules and bans which are often enforced during “volatile” and turbulent markets. History has shown that the majority of market timers who have shorted the market have lost much more than they gained, and that during prolonged market declines bans and rule changes regarding shorting have made it almost impossible for the little guy to beat the odds.

I’ll have to admit that gold does have an allure, and one does feel a bit good about supporting a form of wealth and value that is tangible, and not completely arbitrary like fiat paper money. Yet, when I think about it and look at the historical record an investment in gold doesn’t seem as good as advertised. First, gold is both a commodity as well as “real money” and all commodities go down in a deflationary depression. Now, one could make an argument that gold goes down less than other commodities and largely be defended by historical record. Yet, during a deflationary depression the value of money is actually increasing so why hold have gold which is decreasing in value?

In answering my own question I could state that gold, having tangible real value, is an insurance policy against an arbitrary thing like the dollar. I could also state that since gold has real value one could always use it commercially even if the dollar were to fail. These arguments are valid in some contexts but fall short of supporting me recommending buying gold right now for the following reasons.

First, though gold is tangible and real, in dire times I distrust its functionality. I cannot picture a time in which my dollars would be worthless, but I could go into a local grocer and he would give me basic food stuffs in exchange for a fraction of an ounce of gold. When we all are in need, we need to barter need for need. If I were to getting tangible things to prepare for such an environment it would be amassing things like can goods, water, etc. for which I could barter. In a  depressed world of need, what can someone do with a bit of gold?

Second, if we use history as our guide we would notice that the ownership of gold was prohibited during the Great Depression of the 30’s.  The government banned private ownership and demanded all gold be handed in to banks which would give you something like $35 an ounce even though its stated worth was much higher. Now some people hid their gold and did not turn it in, but of course, they still couldn’t use it.

In today’s world of global tracking and surveillance it would even be harder to hide one’s gold than it was in the 30’s. Yet, your hiding of the gold would be in violation of the law, and therefore punishable if found out.

Since gold and gold stocks will most likely go down in the coming deflationary depression, it would make sense to me to wait on the purchase of gold until the bulk of the deflationary depression is over and the stock market has bottomed.

Currently the US dollar’s role as the reserve currency of the planet is viewed as being in jeopardy. Foreign nations threatening to stop using dollars as the currency of commerce are met with quick and strong political, economic and often military reaction by our government. Our political and economic leaders are very determined to keep the dollar’s role as reserve currency intact.

Many of the countries threatening to decouple themselves from the US dollar are increasing their storehouse of gold, and making efforts to replace the dollar with gold bullion. The nations most determined to get free of the dollar are or are quickly becoming our enemies and their actions and ambitions are labeled as terrorism. Therefore, it would not surprise me in the least if the US were to once again ban the ownership of gold for all US citizens and if they treated anyone who disregarded this ban as a terrorist or at least an abettor of terrorism.

In my post Communists, Terrorists, Charity and Compassion  I discussed a recent case in which something called the liberty dollar was being used locally in a transparent and open way as a form of barter/commerce. As far as I had known it was a very small economy agreed upon by a small number of merchants and was never misrepresented as actual US currency. So, in essence what you had was some actual silver being used similarly as gold advocates propose gold being used if our economic situation were to continue to worsen. Well, as you can see by the quote below the government came in and treated this practice as a form of terrorism.

“Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism. While these forms of anti-government activities do not involve violence, they are every bit as insidious and represent a clear and present danger to the economic stability of this country”
-Anne M. Tompkins, U.S. Attorney, March 18, 2011 [von NotHaus trial]
Wouldn’t the government respond to the use of personal un-minted gold in the same manner?

One last thought before ending. Even the most doom and gloom conspiracist always talks about how the everyone including the Fed, central banks, government and financial elite are opposed and afraid of a deflationary depression.

The fact is that the majority of mega-wealth and power that these entities wield was created during and because of the Great Depression. Many of these same entities are well positioned to have another quantum leap of wealth an power due to an increase in the percentage of ownership in assets around the globe.

I find it hard to believe that the Fed and the financial elite are afraid or opposed to increasing their marketshare in their businesses or the percentage of global wealth they hold. The trend has been more and more money in fewer and fewer hands, is their a better or more complete example of how that takes place than in the aftermath of a deflationary depression?

Do we truly believe that those who most stand to benefit by the financial demise of the lower 99.9% of the populace are really working and making decisions on our behalf?

Jim Guido

I am fascinated by the number of people who continue to debate whether or not we are going into a “double dip” recession, and who forever talk about and question the overall “strength of the recovery”. This debate runs opposite but parallel of the debate we had some years back when people asked if there was a housing bubble with some claiming that the housing market would never go down.

In terms of the housing and stock market bubbles we went from denying its possibility to almost instantaneously being deeply mired in a historically severe recession for months. I remember reading articles proclaiming the health of the economy and real estate market in newspapers and magazines and within a few weeks having the same periodicals bewailing our being mired in a bear market for months. Even this year I continue to find articles which continue to push back the origination of the housing and economic downturn further and further back.

All of this is done with no mention that their publications had previously characterized much of that same time period as part of a raging bull market, adamantly denying and showing statistics demonstrating the health of both housing and the economy. Time periods with graphs documenting the continued rise in house sales and prices have been replaced with current graphs stretching well back into the same years showing dramatic declines in house price and sales.

Now, the entire discussion regarding the possibility of a double dip recession is just as bizarre as the roaring bull market articles during the housing and stock market busts. The earlier recession that almost was never admitted has mushroomed into a lengthy one of some 18 months and is now unanimously viewed as ending in June of 2009 by all mainstream economists.

The stock market bottomed a few months before the official end of the recession in March of 2009. Historically it is normal for the stock market to begin its rebound in slight anticipation of the general economy. So, if the recession ended in mid 2009 how can we be in danger of a double dip recession in mid 2011.

Almost everyone who has any even the most casual knowledge of the economy has heard of the business cycle. The standard business includes periods of growth and decline, of expansion and contraction. The time in which the economy contracts is referred to as a recession. In typical length of a recession is typically 3/8 or about one third as long as the period of economic growth.

Over the last few hundred years there have been a few rather lengthy business cycles which have raised the overall average up a tad. What this means is that is not unusual for a business cycle to complete in less than four years. Since the average business cycle lasts between 4 and 5 years, the average recession, therefore, lasts between 12 and 15 months.

With the above information in mind lets take a look at the concerns about a double dip recession and a fear of the strength and sustainability of the recovery.

We are now entering the 26 month since the end of the last recession. Even if we were to begin to be in a recession right now and it lasted the standard length (1/3) of the period of economic expansion our current business cycle would have ended after a 3 year life span. Though this is a bit short for a business cycle it would not be unheard of. Short business cycles have a tendency to be a little bit bubbly with quick frenetic growth followed by a sharp contraction.

The purpose of the above paragraph was to point out that it is impossible to have a double dip recession after two years. By definition a double dip recession would have to occur a business quarter or two (3-6 months) after the previous recession, not over two years later.

Now lets address the second piece of crap being hurled at us by the economic media and that is the concern regarding the “strength and sustainability” of the recover. Okay, since the recession concluded over two years ago I would consider it foolish to question its sustainability. The recovery has already lasted much longer than the recession and is nearing the typical expansion time frame for the average business cycle, not much question that it has survived and lived an acceptable life span.

Two paragraphs back I mentioned that most short or truncated business cycles have sharp bubbly inclines and rather intense downturns. So, lets now look at the “strength” of this recovery. From a financial and stock market perspective this current business cycle has been one of the strongest cycles on record.

The economic glory years of the 90’s were led by the great technology boom which revolutionized and continues to revolutionize modern life. When we think of change and the future we still think of the global possibilities offered by the internet and related communication technologies. When one thinks of technology one has to look at the Nasdaq and in particular the Nasdaq 100.

The Nasdaq 100 bottomed at 1019 in March 2009. Since then the Nasdaq and Dow have had meteoric rises which are truly amazing. In as little as 21 months the Nasdaq 100 stood at 2400. Which means in less than two years the 100 stood was 235% higher than it as at its low. Though the Dow and S&P did not double during this time frame they incurred gains that haven’t been seen in over 60 years.

At the end of 2010 corporate America were able to declare record profits. And while the pace has slacked off, the profits of corporations continue to rise. Therefore, according to the stock market and corporate America one can not doubt the “strength” of this recovery. Hell, this hasn’t been a recovery, it has been an epic boon for corporations and the stock market demonstrating almost unparalleled strength.

I know many of you reading this are almost screaming at the screen, “wait a minute, I haven’t seen any improvement or growth. It still feels like we are in a recession.” Some of you are even going further noting, “how can we have high unemployment and a decrease in the standard of living and not be in a recession, or at least be in a slow and stagnant recovery?”

Well if you take some time to read my other posts on the economy you will fully understand how we can be in a financial and corporate boon while the standard of living of most of us is in escalating decline. Here is the short answer.

Giving you a job adds to a corporations expenses and such overhead eats away at their profits. In addition, due to inflation the cost of materials and energy needed to produce goods is rising and therefore increased production would also add to their overhead.

So, those of you still reading this may wonder how a company can manage record profits in spite of the fact that expenses of production and materials have risen significantly over the last couple of years.

Here again is the short answer. Corporate America is not dependent on you as a consumer of their goods, in fact most of their profits do not depend on revenue through sales and business expansion. Their profits are mainly generated through financial instruments that not only are not dependent on a strong economy but are maximized when the economy is struggling.

First, most industries don’t even need cheap labor, they can pretty much have the majority of their products made by automation and their business run by computers. The only need they have for workers is for you to have enough money to buy their product. Yet, now that they do business throughout the world, they now have over 7 billion potential customers, and they can thrive even as their customers are poorer. Like Walmart, they make money on volume of sales rather than high prices.

Second, and more importantly is that as long as the economy stays weak the interest rates will stay low. With low interest rates they can borrow money at almost no additional cost and buy stocks, foreign bonds, CD’s, etc. for a substantial profit. It’s a version of flipping that was happening in the real estate market. Here you can purchase (borrow) a million dollars at .1% interest and flip it by investing that same money in something in which they will give you 3, 5 or even 8% for the exact same time frame.
This scam can continue as long as interest rates stay lower here than in other nations. In this new economy the majority of us aren’t needed as consumers nor workers. We are just observers and non-participants of the greatest transference of wealth ever recorded.

Will it ever end? Probably, just like the housing bubble ended though their were plenty of flippers.

How will it end? Another financial crisis will likely be the culprit.

The current debt ceiling debate is more drama than reality. Fleecing the average American of his remaining resources and services is the common goal of all the plans on the table.

Yet, at this point there is no true motive to truly reduce debt, because cheap debt has become the best and most efficient way of making money in our country. More debt at low interest rates is the goal, not the problem. The problem is debt with high interest rates because then you actually have to pay off your debts without being able to make more money with that debt in other debt markets.

The only thing preventing interest rates from climbing are the underlying deflationary tendencies of our struggling economy. If this economy were to actually begin to expand the debt bonanza ends and the big boys will start to really feel the pain. In the meantime their continued record profits are dependent on our being patient with our decelerating standard of living. It depends on are still choosing sides between Democratic and Republicans and viewing each other as stupid or mean spirited.

Even when this business cycle goes crashing down like the previous one, another economic phoenix will rise out the ashes with even less people participating in its wealth and glory. The only way we will be able to participate is if we demand it and stop believing in false prophets spouting forth change, hope or reform. The other way to participate is to become one of the soulless shysters who has no problem owning everything while the masses suffer.

Jim Guido

President Obama ran on a campaign slogan of Hope and Change. At the time it was a call for optimism and reform. Yet now for the majority of Americans the campaign slogan can now be reframed as:

I hope I still have some change in my pocket!

I’ve never had a bumper sticker. But the above phrase along with a photo of the President might be worthy of finally giving in to pop culture.

To say that the campaign was a misrepresentation and that the President’s actions since he took office are a betrayal is an understatement. Hardly a day passes in which our nation makes a decision, law or statement which doesn’t cause me to be more afraid and embarrassed. I often feel I should go around the world and say to almost everyone, I’m sorry I really don’t hate you or believe you are evil.

I have not voted in the last few elections, not because I’m lazy or apathetic. I haven’t voted in the last few elections because I haven’t found a candidate whose value system I can stomach, let alone appreciate. I am truly a voter in search of a candidate.

Ralph Nader was the last person whose value system seemed to be worthy of a vote. I was a little tempted to vote for Ron Paul because he seemed honest and sincere, yet in the end his policies were a little out of date and dangerous even though well intentioned.

If the richest and most powerful country in the world cannot afford to be kind or share, than who possibly can?

I look around the world at the people our government hates the most and I’m a little more than confused. Chavez, Gaddafi, Castro, etc., reads like a list of those who do the most to benefit the standard of living and quality of life of their citizens. I’m not saying these guys are sweet hearts, or aren’t power hungry. But statistically the economic, social, educational and medical growth fostered under these leaders are near the top for nations of their size and type. People such as Nelson Mandela, Desmond Tutu, and other icons of freedom and social justice praise these leaders and consider them friends.

Our government has become famous for doing terrible actions such as torture, war, assassination, occupation and the illegal use of banned weapons all in the name of the good. Our government does terrible things for good reasons and noble intentions while our enemies such as the one’s listed above often do good things for bad or evil reasons.

The Iranian president’s offer to have a media covered open discussion with Mr. Bush and now Mr. Obama is labelled a clever publicity stunt, as is Chavez’s providing free heating oil for the poor and elderly in many nations including our own. Similarly Cuba’s long history of providing free medical care and disaster assistance for people around the globe is considered to be a PR campaign to distract people from the atrocities he commits.

While our government claims to be spreading freedom and democracy around the globe we have the highest prison rate in the world, and are steadily losing our constitutional rights, often due to the noblest intentions of winning the war on terror. Yet even pointing out these inconsistencies is something I do with great reluctance as it could cause my government to view me in a negative light.

I am a simple man whose major ambition is to be a good person and enjoy life. It pains me to see others suffer or to have their lives be dominated by fear and hatred. I know that it is possible to improve one’s world through being a good person doing good things, and that fear and hatred are seldom effective tools for positive change.

Maybe it would be more accurate for our next president’s slogan to be Fear and Hatred, rather than Hope and Change. That honest slogan may win the election, but it won’t get my vote.

09 Polylogue 1  http://guidoworld.com/music/zephyr/polyl…

Jim Guido

Most living things need air, water and food in order to survive. This is definitely the case for human beings. Yet, if you look at how we live and the decisions we make as a planet you would be hard pressed to conclude that life’s basic essentials are a high priority.

In the US the wealthiest, most powerful and advanced society the world has ever known a significant percent of drinkable water is wasted, polluted, used inefficiently or unnecessarily reprocessed. Much of the infrastructure of the US is in a severe state of decay. This is surely the case with the American water system and its aging water lines.

Over 17% of the treated water in the US is lost by leaks in the system, in some cities the estimates are as high as 50% of the water entering the water lines is lost through leakage. Instead of using tax payer money to update and improve the water system and make it efficient, citizens end up paying for water that is lost in the system through their water bills.

In essence we are treating and purifying water for human consumption and than allowing between and 1/5 and a 1/6 of it to be lost in faulty water lines. Yet, this lost water does not include the other ways in which we undervalue and abuse this essential ingredient of human life.

Many reports over the last decade show that Americans eat out an average of four to five times a week. In most US eateries it is a primary duty of waiters and waitresses to keep your cup or glass of water, tea, soda, coffee or any other water based beverage full at all times. What this means is that most people end their meal with a full or partially filled beverage cup which, of course is wasted water.

The list of ways in which we waste water and use it inefficiently would include lawn care, livestock, ornamental water devices and gardening just to mention a few. This is not to say a portion of this is not necessary and beneficial but only to point out that we aren’t actually being frugal with probably the most precious and valuable resource for human existence.

Water we are told is essential for life, and the essence or life. When you consider that any planet without water is considered incapable of sustaining life, it seems odd that we take such a cavalier attitude towards its usage. When you consider that the major portion of our planet’s water is not fit for human consumption it seems unfathomable that we would degrade, pollute and contaminate such a high percentage of our “fresh water” that remains which is suitable for consumption for the billions of people around the globe.

The situation regarding food is just as appalling. Each year the amount of land suitable efor farming is decreasing due to drought, urbanization, industrial expansion and practices to acquire other resources such as wood, coal, oil and various minerals. Yet, despite this, globally we produce around 8.7 trillion pounds of edible foodstuffs. Despite this ample amount of food we live in a world in which 925 million people suffer from hunger.

It is often said that when it comes to food we do not have a supply problem, but one of distribution. Yet, the problem isn’t only about distribution, it is also about waste and lifestyle. Like water, we often do not treat food with the respect it deserves, we do not treat food as an essential aspect of human existence.

According to the UN an astounding 1/3 of all food around the globe is wasted, spoiled or never used. In underdeveloped nations the problem is often of storage, distribution and political conflict. Yet, in the industrialized nations it is mostly a matter of wasteful habits, market practices and economic forces (profit considerations).

According to the report published in early May of this year in industrialized countries, the issue is more about “retailers and consumers throwing perfectly edible foodstuffs into the trash.” The report found that in Europe and North America consumers wasted between 95 and 115 kilograms (209 and 253 pounds) of food every year.
The report found that in the retail industry there was an “over-emphasis on appearance”. “Consumers in rich countries are generally encouraged to buy more food than they need,” it said, giving as an example oversized ready-to-eat meals produced by the food industry and fixed-price buffets in restaurants.

The waste habits and practices of the industrialized west cause food prices to rise all over the globe. This often makes the prices of staples and basic food stuffs unaffordable to a growing number of people. The recent food riots in numerous countries around the globe have been the public reaction to the strain of food prices on a growing percentage or the populace.

A vast amount of edible food is thrown out of restaurants and grocery stores on a daily basis. Waste and destruction of food is significant in almost every phase of the restaurant businesses. At the preparation phase any food that is not visually pleasing is discarded even if it is perfectly edible. Likewise many perishables are discarded if they are not ordered by customers in a timely basis.

Oftentimes meals contain edible foods which are used more for presentation than consumption with the result being they are left unconsumed and thrown away. It is rare that patrons of restaurants eat all on their plate, or take all leftovers home for later consumption. Restaurants are embarrassed when they run out of anything offered on their menu. This results in owners preventing this occurring by over stocking on a daily basis and ending each day with unused food needing to be tossed.
Grocery stores often toss perishables rather than sell them at reduced prices as they near spoiling to protect their profit margins. Waste and reduced prices are all part of the profit equation, and it is often more profitable to throw food away than sell it at lower prices.

Along with food and water man needs to breathe. A man not breathing is a man not living. Though it seems we can breathe air that is far from perfect or even fresh, the truth of the matter is that our survival depends on a relatively narrow band of air quality. Yet, like water, we have adopted many practices which degrade, degrade and contaminate the air we breathe.

The statement that we need air, water and food is simple and basic. It is a statement of fact, that few if any would contest. Yet, our behavior seems to suggest that either we have other priorities we deem more important than existence, or that in the long run, we really don’t care about being alive or the quality of our life.

I personally have a difficulty considering any human society advanced or civilized which does not make basic survival a high priority. It would appear to me that providing all with food, water and healthy air is job one. This is not about politics, ethics or morality, it just about making sense and acting in a sensible way.

Jim Guido

I have lived a frugal life, making little but spending even less. I never incurred debt other than a mortgage and I paid that off as quickly as possible. My wife has been a good bread winner and “went without” a number of years to help us stay out of debt and save for the future. Though we saved we still are far from being able to retire comfortably even if we were to receive the majority of what we paid into social security.

Our long term retirement plan has suffered due to a lengthy restriction on the average person’s ability to save money. The game has changed drastically over the last few years as we see our relative wealth diminish on a daily basis.

A little over a decade ago my wife and I felt we were in great shape. We had paid off our mortgage in about 1/3 of the time it was suppose to take, saving us hundreds of thousands of dollars. (When we realized that the interest on our 30 year mortgage would have caused us to pay over $400,000 for a 130,000 home we payed it off as quickly as we could, thereby, paying about 150,000 instead of 400,000).

After paying off our mortgage we continued to put all we could afford into savings and retirement plans. Soon, we got to a point where through the miracle of compound interest we could basically stop saving and just let our “equity” build through interest. During my life bank and CD rates generally ran between 5 and 8% with peaks of near 18% and lows down to about 3%. Due to this historic range we made our plans based on expectations of averaging a modest 5% per year.

Around this time our son started college and we did our best to pay for his education without borrowing money or taking money out of our nest egg. Yet, towards the middle of his college years and since it has been impossible to save money due to the historically low and historically prolonged low interest rates. This has caused our nest egg to stop growing and linger at a range far below what we need to retire on.

Like many American’s our retirement needs have kind of forced us into taking money out of CD’s and money markets and into the stock market. Statistics show that over 80% of the people who actively invest in the stock market lose money. Considering this recent fact of the stock market of the last decade or so, we have done well to stay at or slightly above the flat line.

Wealth is relative, and a hundred dollars today is worth far less than a hundred dollars of a couple of decades ago. Therefore, due to inflation, unless you’re net worth is increasing you are becoming poorer. Yet, in today’s economic environment we are dealing with more erosion to our wealth than standard inflation.
When trillions of dollars are being printed and entered into our economy we either get our portion of that money or we are becoming poorer. Since the Federal Reserve is not sending you a check every day they print money you can safely assume you are getting poorer.

The truth of the matter is very few people are getting any part of the trillions of dollars being poured into the economy. In theory, the printed money is supposed to go to banks and businesses who will use that money for loans and businesses expansions leading to more high paying jobs which will “stimulate” the economy and the additional wealth will “trickle down” to the majority of people in society.

The majority of newly printed money going to banks is not being lent out to the average citizen who is finding it harder and harder to get a loan. And the majority of businesses who are getting this money through bailouts or loans are not using it to create new jobs or expand their operations. Businesses are reluctant to increase production or raise inventories when consumers are in debt, bankrupt and in danger of losing their homes.

Well then, you may ask, where are these mind boggling amounts of money going? There are a number of huge corporations and billionaires who are reportedly hoarding or “sitting on” cash. Yet, despite a slow growth economy with a high unemployment rate how are corporations claiming record profits?

Here is one possible explanation. Okay, lets start at the beginning. If I am a bank or a large corporation I can borrow money for shorter durations at anywhere from 1% to as little as 1/4 of 1%. Even for loans of a year or more I can borrow it at ridiculously low interest rates.

Now, I can take that money, and use it up by expanding operations and hiring workers, or I can use that money to buy other nations bonds that are paying 5% for the same amount of time that I’m borrowing it at around 1%.

Okay, so if I expanded my business and hired additional workers I would increase my overhead and would be in danger of losing money or failing if the economy didn’t pick up or if people chose to pay off their debt instead of buying my products. So, unless the entire economy picked up, I would probably stand to lose money and not be able to pay off my loan even considering its low rate. And, if most people except the biggest corporations are being denied loans then I can be reasonably assured the general economy is not going to bounce back, and I will not get a return on my investment.

Yet, if I take a loan for 1 million at 1% and I use it to buy a bond for the same duration earning 5%, than I can use the 50,000 of interest to pay off the 10,000 of interest I got from the bank, and claim the remaining 40,000 as profit. Like a good shampoo, you can lather and rinse over and over again. As, long as there are countries with higher interest rates than the US I can borrow money from the US and buy other nation’s or even businesses bonds and make a sizable profit.

Summarizing this process so far, by borrowing money at low rates and buying financial instruments with higher interest rates I can generate a significant profit margin. During this time I can keep operations relatively flat, keeping overhead down by producing the same amount of products with the same number of workers. So, despite no actual growth in business I can make greater profits.

Yet, for a corporation willing to do this, the good times don’t end there. Shortly before I announce my excellent rise in profits to the media, I can increase the number of shares I own and sell those shares soon after the market’s positive response to our business growth. I can explain this growth through some obtuse combination of increased foreign consumption, stealth growth in the local economy, and some good news in “the pipeline”.

In a world of low interest rates, mounting consumer debt, and the practice of trying to avert recessions and financial crises through the endless printing of money, it becomes possible and even logical for businesses to seek to remove consumers from the business equation. For those of you skeptical that what I’m describing is happening, I would encourage you to look back at the performance of the stock market on days in which the Fed made statements inferring that low interest rates were continuing or that data came out showing a need for low interest rates.

My theory also could end the confusion of you market watchers who have been baffled by how often the market skyrockets on the day real poor economic data is reported. Interest rates will stay low as long as the economy struggles. Oddly enough a true economic recovery would probably destroy the impressive stock market rally that has been occurring over the last two years since the “economic crisis” was “solved” by the beginning of bailouts and “quantitative easing”.

Yet, even if my theory is a bit off or its use exaggerated, there is no doubt that the bulk of the money being printed is finding its way into the hands of a very small fraction of the populace, who already own a disproportionate percentage of our nations wealth. It is also safe to state that this money is not filtering down to the rest of us. In fact, it is safe to say that each day the gap between the rich and poor is widening, and that the American middle class is shrinking and we are fast becoming an economy which we would have previously considered to be third world.

We, the majority of Americans, are truly becoming poorer by the day.

In my next post I’ll combine these ideas with the previous two posts regarding people who scare me to describe why I think we need to look at systemic change that needs to look beyond the Democratic/Republican theater which is being used to distract, divide and confuse the populace.

Jim Guido

There are certain personality types, human qualities and styles of living life which scare me, and have me feel threatened. The following discussion highlights some of the characteristics I find most frightening.

People who are ambitious scare me. Ambitious people “make things happen”, “will not let anything stand in their way”, and feel the end justifies the means. Ambitious people are never satisfied and never feel that they have accomplished enough, for the moment they feel they have fully accomplished their goal, they would no longer be ambitious.

The discontented rule the world, and a great many of the discontented are ambitious. A contented or satisfied person has no need or desire to control, own and dominate their fellow men. The ambitious on the other hand have no end to that which they can own and control, millions, billions and even trillions are not enough.

Nothing I have is ever truly safe from the ambitious. There is no object I possess or freedom I enjoy which the ambitious cannot take away. My money, my job, my house and my social standing are all vulnerable to the whims of the ambitious.

The quality of the air I breathe, the water I drink, the food I eat, and the landscape I see are all able to be altered and poisoned by the ambitious. Even my future access to food, water, clean air, and honest information is able to be robbed from me by those with ambition. My access to quality health care and the quality of life available to my children and grand children are fully in the hands of those who always feel the need to accumulate and own more and more.

Our society has been sold on the myth of ambition. We are told that without ambition there would be no progress and all advancement in the quality of life and standard of living are the direct result of ambition. Without ambition we would be little better than animals and our lives would never had advanced past the existence of the caveman.

We are often led to believe that there is no difference between ambition and qualities such as drive and determination. Yet, the world of inventors, creators, geniuses, engineers, discoverers, technicians and theoreticians which have given birth to the vast majority of changes and improvements in science, technology, agriculture and medicine which have positively impacted our quality of life and standard of living have not been particularly ambitious.

While some ambitious people have invented or popularized important and essential elements improving our quality of life through improvements in communication, transportation and agriculture, etc. , the vast majority of contributions have come from compassionate and relatively unambitious individuals. Those who use invention as a means to acquire wealth and power, seldom continue to invent and instead become devoted to forming a monopoly to maximize their power and do their best to inhibit future growth and change which would reduce their power and control.

The majority of our most gifted inventors and geniuses prefer to go from one contribution  to the next and have little interest on capitalizing on their accomplishments. The history of invention is filled with people who were never recognized or known for their ground breaking contributions and more often than not died poor or even destitute. Oftentimes the one recognized or known as the inventor stole or ran the true inventor out of business.

The vast majority of major and minor contributors to the advancement of human life were not motivated by or sought wealth and fame. Most of the advancements in our quality of life and standard of living have been done by people like Jonas Salk who chose not to capitalize on his discoveries and instead of patenting his vaccines preferred the option of improving the lives of others in a cost effective manner. Don’t let the ambitious try to convince you otherwise, people can and will be great without a need to control, own or exploit their fellow man.

The ambitious feel they deserve wealth and control, and expect and demand the respect and admiration of others. The dedicated and driven inventor on the other hand feels it an opportunity and privilege to have their talents and discoveries be utilized in a way to benefit their fellow man and have no need for wealth and fame.

Another group of people which make afraid and wary are the desperate. While the ambitious are often hailed and respected it is the rare person who doesn’t immediately fear and protect themselves from the desperate. It is not so important that a person actually be in a dire situation it is only necessary for them to feel desperate for them to be dangerous and harmful to others.

The ambitious and the desperate share a few similar characteristics. The ambitious and the desperate often exist with a sense of urgency which places their concerns, feelings and desires above all others. Both will righteously defend their selfish actions and minimize if not glorify the harm they do to others. Their sense of discontentment dominates all their feelings and actions, and pervades the way they view their world.

Much of my adult life has been spent helping those in desperate situations. I seldom blame or feel that the people I attempt to assist deserve what is happening to them. Yet, even while I care and have compassion for many of the desperate around the globe I realize it would be fool hardy to not realize the danger they pose to me and my existence.

Another group of people I fear are those that feel they have it all figured out. These people feel that absolute truth exists and that they are the fortunate custodians of it. It matters little to me of the source of this monopoly on Truth, it origin could be science, religion, mysticism or spiritualism. What only matters is that for them their is only one Truth for them and for all others.

Since they know the Truth, the only option available to you is to agree with their perspective and conclusions. Any “resistance” to their viewpoint is a sign of stupidity, evil, lostness or danger. The custodians of Truth believe the rights and freedoms of the non-believers are not to be respected, and often times punishment of the non-believers is thought of as being the truly noble and right thing to do.

In the world of belief and Truth, their is no room for discussion, tolerance or divergent viewpoints for either one knows and accepts or one is a problem and a heathen.  As I mentioned earlier it matters little if the source of this inflexible righteousness be science, philosophy, psychology or religion, what is scary is the intolerance shown to all those who question or do not openly agree.

These people scare me not only because they can label me as evil and forbid me to live differently then them, but also because their righteousness and certainty often bar them from seeing the world as it really is and thereby preventing solutions to problems which are causing so much unnecessary suffering in the world.

This does not mean I claim any insight into any competing ultimate truth, but only to recognize that sometimes immediate problems have real solutions that can be shown to work in the here and now. Truth mongers often freeze life into some ideal state which prevents them from seeing the  uniqueness of a situation or how some action or intervention may be beneficial now, but not be suitable in a different time or situation.

The last group of people I’ll address today which frighten me are the deceivers such as con men, propagandists and spin doctors. Now, I am comfortable with the fact that most people have difficulty getting through the day without engaging in some form of lie or exaggeration, yet it is the professional deceiver that scares me. Such professionals don’t have to be perceptual mangers or propagandists, but even salesman, politicians, and businessmen who use deception as a standard means of interacting with others are extremely frightening to me.

I base the majority of my actions, decisions and emotional attachments on the information I have at hand. I try to be sensitive to others and do the right thing, but how can I make a good and caring decision if the information I’m basing that decision on is bogus or dishonest?

Those who deceive can convince me to act in ways which are not in my best interests or in the best interests of others. They can convince or encourage me to do things which harm me or others. They can deceive me into giving away my freedoms or to over estimate perceived dangers. In a world populated by professional deceivers it is hard to feel safe and to trust your instincts. When you are lied to and manipulated it is easy to become depressed, untrusting, cynical and/or disillusioned.

I feel threatened by the deceivers because they put into doubt and rob from me my sense of reality. In a world of deception I lose all sense of perspective, and have no idea if my thoughts and actions are valid or beneficial, or if my accomplishments are real or imagined.

In any relationship or communication in which I tell the truth and the other lies, they have  all the power and control. When I’m honest and they are not, they become the sole possessors of reality, and can use that to their advantage. I’m afraid of those with power because they rob me of reality, and make it unwise for me to trust others.

All four types of people I’ve discussed have a tendency to unnecessarily intrude themselves into my life often with the goal to take from me, change me, exploit me, or have me serve their purposes. I must admit that I do myself have a desire to help, give to and benefit from the talents and lives or those around me. Yet, I try only to give to people what they want and not what I think they should want.

The most disheartening aspect of this post is the fact that our society encourages, fosters and rewards the existence and proliferation of all four of these types of people. I can envision and have often in many other posts outlined the type of changes which we could easily introduce into our social structure which would encourage and foster more noble aspects of human nature. Yet, it is in the selfish exploitative interests of the above mentioned four personality types to have us believe that this is the best of all worlds and that it is human nature for the ambitious and discontented to rule the world.

I have spent over 30 years working with families and individuals trying to improve the quality of their life and their relationships with others and themselves. I have seen how small structural and systematic adjustments can have powerful and lasting impact on the quality of one’s life and personal experience.
I hope you will visit guidoworld often to hear a voice of realistic optimism. There are many of us out there, but we definitely do not have the forum given to the ambitious deceivers who claim absolute certainty. Being generally content we just don’t have the need and sense of urgency similar to the control oriented discontents who currently aspire to and rule the world.

Here is a lyric that fits well into this discussion. I should have a mix for this song on the Zephyr CD within a week or so.

Discovery

Seeking a language of will
That fosters shared reality
The goal be to sate and fulfill
To walk this earth in harmony

The restless hijack society
Into an endless battle for supremacy
Some gird their loins while others flee
Taking refuge in faith, myth and fantasy

Anger and fear block their way
Turn humane thoughts into blasphemy
The empty keep the caring at bay
With tabloid lies and innuendo

Let’s sing our loud life’s sweet rhapsody
Celebrate where we’ve been, and where we will be
We are all passengers of mystery,
Every thought we have, every sense we feel
Is full of discovery

The closer we get the louder they’ll scream
Sages we respect they’ll insult and demean
I respect your life, I revere this life
I’ll comfort you, support all the good you do

Let’s sing our loud life’s sweet rhapsody
Celebrate where we’ve been, and where we will be
We are all passengers of mystery,
Every thought we have, every sense we feel
Is full of discovery

Jim Guido

The entire quality of a human life can change in an instant. A life of relative joy, comfort and happiness can be replaced by hardship, pain and suffering with little or no warning. Everyday lives are impaired, altered and rendered joyless due to a sudden accident, fire, disease or trauma. In most cases there is little reason for the misfortune, and its woes can be indiscriminate and random.

Human beings are often amazing in their ability to adapt and be resilient. Some people can endure the greatest hardships and still emerge with an optimism and energy that defies logic. Yet, this does not make others pain, suffering or depression any less real or compelling. While in one sense people can be resilient, in another sense human life is a very fragile and precious thing.

Sometimes tragic events happen which change or damage many lives at once. Floods, tornadoes, hurricanes, plagues, epidemics can wreak havoc on entire communities or peoples. Often times innocent bystanders can be the victims of war, politics and military aggressions that they have no role or even say in its occurring.

Next to atomic war and plague little matches the devastation that can be rendered by volcanoes, earthquakes and tsunamis. The people of Japan are currently enduring one of the most hideous forms of tragedy that one can imagine. In just a few moments an entire predictable life and personal history can be washed away by a huge wave, or come collapsing down around you in a traumatic quake.

The comforts and needs it took civilizations thousands of years of sustained growth to acquire can be suddenly taken from you. While some “needs” we are culturally dependent on like electricity and communication devices, others we are truly dependent on such as food, shelter and water.

Both social and mainstream media are event driven. In this respect it should be no surprise that natural disasters such as floods, earthquakes, volcanoes and hurricanes instantly capture our attention. The rapid explosion of social media is changing the way we see and receive mews. The vividness of the events unfolding in Japan are so much more enthralling and compelling due to the rise and pervasiveness of social networking technology. The relatively recent events such as Katrina and Haiti pale in comparison  due to their relative lack of on the scene personal coverage and real time processing of personal experiences of those in the midst of the event as it occurs.

While our hearts go out to all those suffering in Japan, we should not forget those all throughout the world who are suffering from man made political and social tragedies. The real suffering and devastation of Japan should not preclude us from the stories and struggles of those fighting for political freedom, or who are starving due to the political policies or power plays of their or our governments.

Life is indeed both precious and fragile, and no ones security is beyond being taken from them.  We have so little control over the natural events and natural phenomena which can injure and destroy our quality of life and sense of safety.  Yet, we do have the ability to have some control over the political, governmental and military policies and actions which impact on the quality and tenor of our lives.

People hungry, homeless, sick, or traumatized are not in need of our cultural arrogance or ideology.  They are not in immediate need of our military, or our system of economy or government, but rather they are in need of the basics of life to ease they pain and insure their survival.

In respect for human dignity we need to offer assistance in the way that those in need want to be helped. It is their needs and survival currently at stake, not ours. Someday in the blink of an eye we may need someone’s help, and it would be nice to get help from someone who respected and insured our sense of dignity and way of life.

Jim Guido

Recently I saw the Michael Moore documentary “Capitalism: A Love Story” and was shocked to see footage of FDR outlining a Second Bill of Rights during his State of the Union Address in 1944. How could a president have proposed this and I never heard of it?
Here is Wikipedia’s summary of this proposed legislation.

The Second Bill of Rights was a list of rights proposed by Franklin D. Roosevelt, the then President of the United States, during his State of the Union Address on January 11, 1944. In his address Roosevelt suggested that the nation had come to recognize, and should now implement, a second “bill of rights”. Roosevelt’s argument was that the “political rights” guaranteed by the constitution and the Bill of Rights had “proved inadequate to assure us equality in the pursuit of happiness.” Roosevelt’s remedy was to declare an “economic bill of rights” which would guarantee:

Employment, with a living wage,
Freedom from unfair competition and monopolies,
Housing,
Medical care,
Education, and,
Social security

Excerpt from President Roosevelt’s January 11, 1944 message to the Congress of the United States on the State of the Union[1]:““It is our duty now to begin to lay the plans and determine the strategy for the winning of a lasting peace and the establishment of an American standard of living higher than ever before known. We cannot be content, no matter how high that general standard of living may be, if some fraction of our people—whether it be one-third or one-fifth or one-tenth—is ill-fed, ill-clothed, ill-housed, and insecure.
This Republic had its beginning, and grew to its present strength, under the protection of certain inalienable political rights—among them the right of free speech, free press, free worship, trial by jury, freedom from unreasonable searches and seizures. They were our rights to life and liberty.
As our nation has grown in size and stature, however—as our industrial economy expanded—these political rights proved inadequate to assure us equality in the pursuit of happiness.
We have come to a clear realization of the fact that true individual freedom cannot exist without economic security and independence. “Necessitous men are not free men.”[2] People who are hungry and out of a job are the stuff of which dictatorships are made.
In our day these economic truths have become accepted as self-evident. We have accepted, so to speak, a second Bill of Rights under which a new basis of security and prosperity can be established for all—regardless of station, race, or creed.
Among these are:

The right to a useful and remunerative job in the industries or shops or farms or mines of the nation;
The right to earn enough to provide adequate food and clothing and recreation;
The right of every farmer to raise and sell his products at a return which will give him and his family a decent living;
The right of every businessman, large and small, to trade in an atmosphere of freedom from unfair competition and domination by monopolies at home or abroad;
The right of every family to a decent home;
The right to adequate medical care and the opportunity to achieve and enjoy good health;
The right to adequate protection from the economic fears of old age, sickness, accident, and unemployment;
The right to a good education.
All of these rights spell security. And after this war is won we must be prepared to move forward, in the implementation of these rights, to new goals of human happiness and well-being.
Americas own rightful place in the world depends in large part upon how fully these and similar rights have been carried into practice for all our citizens.
For unless there is security here at home there cannot be lasting peace in the world.”

If you go to You Tube you can see the footage and hear the address for yourself. This footage was supposedly lost for a number of years and was only recovered in 2008.

In my last post I discussed the significant role perceptual management has played in the US over the last 100 years. The desire of our government and corporations to persuade us to act and think in ways which preserves and enhances their power and wealth may help explain the fact that though I was born a little more than 11 years after this address, I never once heard of it during all my years of education.  Anyone saying these words today would be labeled a socialist or communist and could easily be labeled a terrorist and an enemy of the state.

Our perceptual managers lead us to believe that the American middle class has been the envy of the world for generations. Yet, the reality of the fact is that the American middle class is (was) a short lived phenomena with the bulk of American economic history having almost all of its wealth hoarded by a privileged few. Our current disparity of wealth and the destruction of the middle class has been the norm and not just a recent occurrence.

Here is an excerpt from, “The Global Economic Crisis: The Great Depression of the XXI Century” by Andrew Gavin Marshall which I read today @ the Global Research on line at http://www.globalresearch.ca/index.php?c….

Throughout much of the 1800s and into the 1900s, the United States suffered several economic crises, one of the most significant of which was the Great Depression of 1873. As Howard Zinn explained:

The crisis was built into a system which was chaotic in its nature, in which only the very rich were secure. It was a system of periodic crises – 1837, 1857, 1873 (and later: 1893, 1907, 1919, 1929) – that wiped out small businesses and brought cold, hunger, and death to working people while the fortunes of the Astors, Vanderbilts, Rockefellers, Morgans, kept growing through war and peace, crisis and recovery. During the 1873 crisis, Carnegie was capturing the steel market, Rockefeller was wiping out his competitors in oil.[32]
Massive industrial consolidation by a few oligarchic elites was the rule of the day, as J.P. Morgan expanded total control over railroad and banking interests, and John D. Rockefeller took control of the oil market, and expanded into banking. Zinn explained:
The imperial leader of the new oligarchy was the House of Morgan. In its operations it was ably assisted by the First National Bank of New York (directed by George F. Baker) and the National City Bank of New York (presided over by James Stillman, agent of the Rockefeller interests). Among them, these three men and their financial associates occupied 341 directorships in 112 corporations. The total resources of these corporations in 1912 was $22,245,000,000, more than the assessed value of all property in the twenty-two states and territories west of the Mississippi River.[33]
In the early 20th century, European and American banking interests achieved what they had desired for over a century within America, the creation of a privately owned central bank. It was created through collaboration of American and European bankers, primarily the Morgans, Rockefellers, Kuhn, Loebs and Warburgs.[34]

US history shows a marked tendency towards the systematic fleecing of all wealth from its citizenry to the economic elite than towards a spreading of the wealth and standard of living for a growing middle class. The short lived gains in the standard of living enjoyed by a burgeoning middle class can be explained by two factors.

Initially the middle class was formed as a beneficiary of the incredible wealth and power the US acquired as a result of the two World Wars. A temporary rise in wealth, opportunity and education engendered the necessary loyalty and productivity required to build the most powerful empire the planet has ever known. Second, the creation of a consumer class was needed to fuel the continued growth of industry and technology allowing the military/industrial complex to thrive and police the entire globe.

Yet, the actions and decisions of both the government and corporations shows that they never truly planned on honoring their contracts with the American middle class (i.e.: pension funds, social security). The role and need of the consumer age is on the decline. In its current phase the role of the American consumer is being diminished as the role of the global consumer increases. Yet, in a nanotechnological global economy dominated by artificial intelligence, virtual reality, and increasingly abstract financial instruments the need for actual consumption becomes less important to power and wealth.

My read of history is that the American middle class was largely created and exploited for the purposes of empire building. My read is also that the American and European middle class has largely served its purpose and is no longer necessary. No longer needed as consumers we are being prepared to return to our historical role as serfs and slaves.
If my gut is right on this, we should be very close to the next Great Depression which will attempt to ring the middle class out of all societies throughput the globe and consolidate all international wealth and ownership to a frighteningly small number of individuals.

Perceptual management is a science and a fact of modern life. Yet, the gift of perceptual managers is their ability to divert people’s attention from what is really going on. The talents of perceptual managers and propagandists is evident in the fact that most people still believe in the American dream and the integrity and honesty of government and business.
In our perceptually managed society anyone asking questions or making logical conclusions that pose a threat to the heart of their deception will successfully be labeled a conspiracist or an extremists. Yes, I know extremists and conspiracists are real, but so are spin doctors, propagandists and perceptual managers.

Jim Guido

The tricks of a skilled magician take advantage of the natural tendency of the mind and couples that with additional elements of ‘the not seen”. Our minds are gifted at reaching practical conclusions while using the minimum amount of perceptual data, this is not only efficient, but highly necessary in maximizing our ability to survive.

We never truly see the world we functionally see. Most of the objects in the living room we navigate or the road on which we drive are only partially given to our vision. We don’t see the backs, or even a major portion of everything we perceive and know. The bulk of the lamp, couch and even friend we’re talking to are hidden from our view. So, is well over 50% of the car, building, telephone pole, curb and pedestrian which make up my perceptual field while driving. Add on to this the fact that our attention drifts and we execute most of our actions on auto pilot and our ability to live relatively blind is astounding.

Our mind is forever filling in huge gaps of perceptual data allowing us to successfully move about quickly and with little difficulty. We are so accustomed to this way of being in the world that we are generally blind to how little we actually see, and how much our mind fills in giving us the illusion of actually having a perceptual field and immediately seeing the world around us. As our eyes quickly scan our environment we have the illusion of seeing the entire room at once when it truth we are only seeing a fraction of the room (environment) at each focused moment.

Magicians take advantage of our limited vision and focus and trick us into making conclusions which are proven wrong in the end. By distracting our attention, encouraging us to make false conclusions, and doing actions in spaces we only think we see, the magician is able to trick or baffle us. The hand isn’t only quicker than the eye, but the mind is also often more involved in vision than the eye.

Vision isn’t the only aspect of our perception which uses the minimum amount of data to make an on-the-fly functional assessment of a given situation. Just as we can recognize someone by only seeing their hand we name a song after hearing just a few notes, or realize we are touching a couch on an initial bump in a darkened room.

Misleading people, and getting to think, feel and believe in things that they wouldn’t otherwise do is not just a magicians skill. Other long standing professions such as acting and the con man have long exploited the tendency of people to reach conclusions based on minimal evidence.
While magicians and actors have used this talent more to entertain and in some ways enlighten their audiences, con men have exploited our natural tendencies of mind for personal gain and control. Con men are famous for gaining one’s trust, for once you trust them you will accept and not question their tricks and motivations.

Yet, the desire to deceive, manipulate, and con has never been more common and pronounced as in the birth of the capitalistic consumer culture. The entire field of public relations was founded on the idea of how to influence people into seeing things the way you want them to. Good public relations allowed a company to retain a positive public image despite the fact that its success was dependent on your buying things you don’t need. Public relations became the science of propaganda and perceptual management.

In a free democracy funded by a capitalistic industrial consumer culture the role of public relations became increasingly important. In business the trust and loyalty of your client base was essential in ensuring your long term success. In politics the ability to convince voters to trust you and view you in a positive light was essential to your getting elected and staying in office.

Since the early 20th century the science of propaganda and perceptual management has been as important to business and government as any other science or discipline. The growth and importance of psychology in general and social psychology in particular has been powered by its essential role in both politics and business.

In 1917 the US government formed its official initial sanctioned body to assist in the new and important realm of perceptual management called the Committee on Public Information, also known as the CPI or the Creel Committee. As explained in Wikipedia CPI “was an independent agency of the government of the United States created to influence U.S. public opinion regarding American participation in World War I. Over just 28 months, from April 13, 1917, to August 21, 1919, it used every medium available to create enthusiasm for the war effort and enlist public support against foreign attempts to undercut America’s war aims.”

The techniques spawned by this rather successful venture in perceptual management helped social psychology and Public Relations become entrenched and cherished sciences of all capitalistic and democratic societies. Obviously propaganda techniques of deception and influence work best on people who are unaware of the exact areas their perceptions are being manipulated. This resulted in the avowed termination of the use of political propaganda being used domestically on US citizens and only being used as psychological warfare on foreign agents and governments.

In the political sphere the recognized usage of propaganda became relegated to the realm of psychological warfare and our stated desire to promote freedom and democracy throughout the globe. Wikipedia states that the U.S. Department of Defense (currently)defines psychological warfare as:

“The planned use of propaganda and other psychological actions having the primary purpose of influencing the opinions, emotions, attitudes, and behavior of hostile foreign groups in such a way as to support the achievement of national objectives.”[2]

While this definition states the primary purpose is on foreign groups it is logical that domestic groups and citizens can be the targets and recipients of propaganda if their views are contrary or not in support of our government’s national objectives. In this way it only makes sense that perceptual management techniques are used to raise capitalistic status quo sentiments and quell any ideologies or values which go against the grain.

In the area of commerce we have been able to be a little more honest about the pervasive use of perceptual management in the arena of advertising and corporate Public Relations. The blatant aspects of commercial advertising is admitted and embraced as a form of entertainment by business and the public alike. Every small business owner, tradesman and professional uses and is aware of others use of the art of selling one’s product.

While the more sophisticated and subtle forms of “marketing” and perceptual management are left unarticulated or examined, the general feeling is that most of modern advertising and perceptual influence is above board and benign. This has resulted in many people considering themselves advertising savvy and generally impervious to the techniques and influence of advertising.

It is common knowledge that our intelligence agencies spend a great deal of time, money and effort on improving the techniques of influence and propaganda in the whole spy world. Our ability to create, extinguish and direct insurgency and counterinsurgency movements in foreign nations is considered to be quite sophisticated. Our intelligence agencies have been credited with successfully using propaganda campaigns to incite a foreign coup, overthrowing enemy governments, and creating democratic movements in oppressed societies.

While the focus and ownership of Psychological Operations is on influencing foreign lands and peoples, throughout the years a number of government sponsored domestically targeted propaganda campaigns have come to light. Yet, their existence is quickly put in the past tense and their objective and influence is minimized whereby within a short time an agency of disinformation or brain washing is but a faint memory in the mass consciousness.

To me it doesn’t make any sense that our use of perceptual management is being relegated to the areas of advertising, foreign policy, and political campaigns. Obviously it would be counterproductive for our domestic propaganda and perceptual management programs to be popularized and admitted. Therefore, it is probably safe to assume that we are constantly being subjected to the latest and most sophisticated of social management and influence techniques.

No nation in history has devoted more of its intellectual and monetary resources in its military and related war industries. Our military research and expenditures are not just devoted to arms, bombs, planes and missiles. Modern warfare is not just about hardware and troops, but involves chemical, germ, biological, economic and psychological warfare.

During WWII the US recruited the greatest minds in physics to help build the first nuclear bombs. Likewise our space program of the 60’s also congregated the most advanced rocket scientists in order to insure the US won the “race to space”. Of course, the race to outer space was as much a defense department project as anything else. The push of the satellite boom came from a desire to control and monitor and communications as well as have a strategic advantage in standard warfare with the “eye in the sky”.

Most defense and war project have a tendency to filter down some of its technology for commercial and civilian use the satellite technology gave us huge improvements in meteorological information and prediction, as well as the birth of cable and satellite TV, as well as surveillance and GPS technology. Much of computer technology and the internet were originally defense projects.

During the two official years of the Committee on Public Information (CPI) great strides were made in the field of perceptual management similar to the success of the Manhattan Project. Propagandist’s learned just a few of the ways language and images could be used to elicit specific emotions and how to foster support for government policies and actions.

“The engineering of consent” as the early propagandists and Public Relations described their task has now been the commercial and political focus of the best social psychological minds for near a century. Perceptual management has received as much attention from our defense department as any other aspect of modern warfare. It is not only how we influence the decisions and policies of foreign nations, but it is also how we make sure our own nation stays stable and adapts and accepts the decisions of our leaders.

Though specific forms of subliminal messaging have been banned, we also know that violations of this ban have and do occur. We know about spin, and smear campaigns, and how our government through the media uses words to color and influence our thoughts and feelings. Yet, by and large we trust that our government is generally honest and well intentioned.

The success and effectiveness of propaganda and perceptual management is on its ability for its operation to remain hidden and secret. A popular magician can only let us in on how he did his trick if he no longer plans on doing that specific trick in that manner. His success at creating magic is dependent on our not knowing how he does it. Likewise, good perceptual management and propaganda is effective to the degree that those targeted to be influenced are ignorant of the exact techniques being used. The exception to this is if the audience finds the techniques entertaining and wants to be influences as this is the case with much of modern advertising such as most TV commercials.

We are peripherally aware that a lot of research has been done studying flocks, swarms and herds of birds, insects, and animals. We’ve not only studied the social behavior of living things but also studied the “group” behavior of things and events such as waves, sand piles, meteorological fronts, and various other “collectives” to understand, and predict group reaction. In both living and non-living collectives we are learning not only how to better predict when and what is about to happen, but in many cases are learning how we can influence and alter the actions of collectives.

By understanding the intricacies of a bee or ant colony we can influence and control much of the behavior of the group. The migration pattern of birds as well as the progression of wind patterns can be redirected and altered. The exact way in which this knowledge can be used in its application of human groups and herds is the stuff of modern research and science fiction. Yet, it is obvious that usages do and will exist for the purposed of perceptual management and social psychology.

The successful con man taught us years ago that their most effective psychological tool was to gain a person’s trust. Once a person trusted you they were easy prey to your confidence game. Even after the facts came to light many people were unwilling to believe that the con man wasn’t who he said he was, and that there had to be some mistake because he was such a good guy.

Yet, in the early years of social psychology other emotional tools than gaining trust were found to be just as effective. Two other successful emotional strategies are too create dependency or instigate fear. A fearful or dependent person will gladly hand over all power to someone who can protect them or act on their behalf.
Evidence of this method’s use in the US since the 1930’s is not hard to find. Fear mongering has been a staple of getting public support for most wars and military action. Likewise, fear of communism, socialism and terrorism have been used to blunt social change and well as have people relinquish their rights and privacies to insure their safety.

Our research and use of torture has likewise been used to teach us more on how to influence and control human behavior. The standard Hollywood version of the good cop bad cop strategy was born from the early studies of the psychology of torture. We also learned that a person being tortured often becomes dependent on their abuser. Since their very survival depends on the whims of their abuser they will often become attached to their abuser, and inside of that relationship became oddly loyal to their abuser.

Much of the early research into the science of propaganda was done by the Third Reich under Hitler’s Germany. One of their discoveries was that if you repeated a lie often enough, it would become accepted as truth by the majority of people. Over the last century this technique has still been a favorite of political propagandists around the globe.

While fear mongering and demonizing your opponent is still a pervasive tool of perceptual managers their are less blatant ways to discredit your opponent and thereby gain support for your position or agenda. It is rare that a single political race can be run in the US that does not involve some form of a smear campaign in which one candidates stock rises due to the lowering of credibility of the recipient of the smear campaign.

Discrediting or ruining the popularity of your opponent can be done is far subtler ways such as placing a bumper sticker for your opponent on a car and then having the driver of that car cut people off in traffic, swear at other motorists etc., all to have people associate the opposing candidate and their supporters as being jerks.

When peaceful demonstrators start to shift public favor against the war, the FBI and pro-war groups can infiltrate the demonstrations and try to incite the demonstrations to become violent while posing themselves as being anti-war demonstrators. Or if you’re a corporation whose profit margins are being threatened by ecological group you can turn public opinion against the ecologists by forming an ecological group that is extreme or has illegal practices thereby despoiling the popularity of ecological groups and their causes.

Most of the propaganda strategies I’ve listed in this post are pretty basic and would be taught in any basic course in Public Relations or Social Psychology. Yet, just as our government only sells relatively outdated weapons to our enemies, likewise, the latest generation of perceptual management techniques are not available for public knowledge.

Now, I’m a person with many interests, and trying to identify the ways in which my perceptions and actions are being influenced, managed and altered by professional propagandists does occupy my attention. Yet, people far smarter than myself, and very motivated and financially rewarded for developing methods and techniques to out fox even the savviest citizen, are working full time. Thousands of our best minds in social psychology are working directly and indirectly for our defense department in efforts to win wars fought on all fronts. All wars include not only physical wars, but psychological, chemical, biological, germ and ideological.

The fact is that trillions of dollars (mostly tax payer) are being funneled into defense department research insuring that our empire continues to rule the globe. The monitoring and winning of the hearts, minds and actions of people here and abroad is a practical and not just theoretical goal. We are being handled, monitored, influenced and coerced by the best financed and most intelligent army of perceptual engineers the world has ever known.

A successful corporation gives substantial campaign contributions to both candidates, to insure that whoever wins the election is grateful for, beholding to and dependent on their support. A skilled perceptual manager is ready and prepared for various outcomes. Even when a situation goes in an initially undesirable direction they stand poised to find a way to co-opt, exploit or redirect the matter in a profitable manner.

The current political turmoil in North Africa and the Middle East is a perfect example. The US has created, supported and maintained most of the despots whose future careers are in jeopardy. Yet, while exploiting the economic and political stability gained by dictatorships, we also have been funding and creating “democracy movements” in these very nations. The following is an except from an article I recently read in The Global Researcher on line by Andrew Gavin Marshall who is a Research Associate with the Centre for Research on Globalization (CRG). 

As the Council on Foreign Relations Task Force Report emphasized, “America’s goal in the Middle East should be to encourage democratic evolution, not revolution.”[26] Engineering, co-opting and controlling revolutionary movements or “democratic regime change”…..In a 2008 article in the New York Times, Brzezinski emphasized a multi-faceted strategy for dealing with this ‘threat’ to elite structures and interests, explaining that, “the monumental task facing the new president is to regain U.S. global legitimacy by spearheading a collective effort for a more inclusive system of global management.” Thus, Brzezinski’s strategy rests on better securing and institutionally expanding the process of ‘globalization’ into the evolution of ‘global governance,’ or as he termed it, “global management.” Brzezinski unveiled a four-point strategy of response: “unify, enlarge, engage and pacify.”[18]

The man alluded to is the article is geostrategist Zbigniew Brzezinski, an intellectual architect of ‘globalization who has been very influential in US foreign policy and strategy. As you can see he advocates that our government needs to “engineer”, “co-opt”, and “control” revolutionary movements.
I invite you to read more of his thoughts. In sum, Mr. Brzezinski goal is to help the US maintain its role as world leader. He feels that without our governments control the US and the world would fall into complete chaos.

Yet, Mr. Brzezinski is a true perceptual manager. He doesn’t want people in the US or abroad to truly have choice or a say in the government. He only wants them to think they have a choice and feel free.

He believes that our government has done a good job of stripping American’s of most of their rights (and wealth) while having them retain the perception of freedom. He feels that with our governments guidance despots can be removed and replaced with pseudo-Democracies keeping the basic power structure in place. This would diffuse anger and discontentment while maintaining fiscal stability and a hoarding of the wealth in its current hands. This is consistent with the idea of the New World Order version of Globalization first publicly trumpeted by George Bush I in the late 80’s.

So, while you read newspapers which have over 70% of their articles written and placed by special interest groups and listen to scripted TV and radio interview dialogue you just hold on to the idea that you are the master of your domain and the author of your viewpoints. While you are busy following the debate between liberals and conservatives and Republicans and Democrats I will try my best to watch the magicians hands while knowing I’m missing more than I’m catching.

Do you believe in magic?

Jim Guido

PS I have some songs which address some of the ideas raised by this post (i.e.: Svengali, Mob Rule, Say Boys, Lies, Demonic Democracy, Making Money, Someone Will Die Tonight)

Most American’s believe the bulk of manufacturing jobs have been lost to cheap overseas labor. While this is not a total falsehood, most citizens would be shocked to learn that a good deal of American jobs have remained in the good old USA, the only problem is you only can get the jobs if you are in prison.

While the unemployment rate climbs and industries are shrinking in urban and rural areas alike, business and the job market is positively booming inside US prison walls. From a corporate perspective prison labor is a gold mine, just consider these fiscal and investment nuggets. The following statistics are from 2008.

Human rights organizations, as well as political and social ones, are condemning what they are calling a new form of inhumane exploitation in the United States, where they say a prison population of up to 2 million – mostly Black and Hispanic – are working for various industries for a pittance. For the tycoons who have invested in the prison industry, it has been like finding a pot of gold. They don’t have to worry about strikes or paying unemployment insurance, vacations or comp time. All of their workers are full-time, and never arrive late or are absent because of family problems; moreover, if they don’t like the pay of 25 cents an hour and refuse to work, they are locked up in isolation cells.

In response to this employers dream corporations are lobbying hard to hep pass laws which will help prison populations to swell, as well as pushing for funding to be available to create more prisons. The percentage of private for profit prisons is also accelerating. Some more stats from 2008 to be found in an article by Global Research will illustrate these points.

There are approximately 2 million inmates in state, federal and private prisons throughout the country. According to California Prison Focus, “no other society in human history has imprisoned so many of its own citizens.” The figures show that the United States has locked up more people than any other country: a half million more than China, which has a population five times greater than the U.S. Statistics reveal that the United States holds 25% of the world’s prison population, but only 5% of the world’s people. From less than 300,000 inmates in 1972, the jail population grew to 2 million by the year 2000. In 1990 it was one million. Ten years ago there were only five private prisons in the country, with a population of 2,000 inmates; now, there are 100, with 62,000 inmates. It is expected that by the coming decade, the number will hit 360,000, according to reports….. “The private contracting of prisoners for work fosters incentives to lock people up. Prisons depend on this income. Corporate stockholders who make money off prisoners’ work lobby for longer sentences, in order to expand their workforce.

Now, this information may be news to many of you, but such a lucrative investment arena has certainly not been hidden from investors. The article later states:

The prison industry complex is one of the fastest-growing industries in the United States and its investors are on Wall Street. “This multimillion-dollar industry has its own trade exhibitions, conventions, websites, and mail-order/Internet catalogs. It also has direct advertising campaigns, architecture companies, construction companies, investment houses on Wall Street, plumbing supply companies, food supply companies, armed security, and padded cells in a large variety of colors.

Okay you might be saying, sure this type of thing probably goes on, but surely it can’t be a major factor in any specific industry. Well, I’ll just quote away.

According to the Left Business Observer, the federal prison industry produces 100% of all military helmets, ammunition belts, bullet-proof vests, ID tags, shirts, pants, tents, bags, and canteens. Along with war supplies, prison workers supply 98% of the entire market for equipment assembly services; 93% of paints and paintbrushes; 92% of stove assembly; 46% of body armor; 36% of home appliances; 30% of headphones/microphones/speakers; and 21% of office furniture. Airplane parts, medical supplies, and much more: prisoners are even raising seeing-eye dogs for blind people.

The article goes on to name names. This partial list from 2008 shows how varied the business cliental for prison labor is.

Who is investing? At least 37 states have legalized the contracting of prison labor by private corporations that mount their operations inside state prisons. The list of such companies contains the cream of U.S. corporate society: IBM, Boeing, Motorola, Microsoft, AT&T, Wireless, Texas Instrument, Dell, Compaq, Honeywell, Hewlett-Packard, Nortel, Lucent Technologies, 3Com, Intel, Northern Telecom, TWA, Nordstrom’s, Revlon, Macy’s, Pierre Cardin, Target Stores, and many more. All of these businesses are excited about the economic boom generation by prison labor. Just between 1980 and 1994, profits went up from $392 million to $1.31 billion. Inmates in state penitentiaries generally receive the minimum wage for their work, but not all; in Colorado, they get about $2 per hour, well under the minimum. And in privately-run prisons, they receive as little as 17 cents per hour for a maximum of six hours a day, the equivalent of $20 per month. The highest-paying private prison is CCA in Tennessee, where prisoners receive 50 cents per hour for what they call “highly skilled positions.” At those rates, it is no surprise that inmates find the pay in federal prisons to be very generous. There, they can earn $1.25 an hour and work eight hours a day, and sometimes overtime. They can send home $200-$300 per month.

Now, its not just corporations looking for money, but politicians are even trying to attract prison labor positions to their state.

Thanks to prison labor, the United States is once again an attractive location for investment in work that was designed for Third World labor markets. A company that operated a maquiladora (assembly plant in Mexico near the border) closed down its operations there and relocated to San Quentin State Prison in California. In Texas, a factory fired its 150 workers and contracted the services of prisoner-workers from the private Lockhart Texas prison, where circuit boards are assembled for companies like IBM and Compaq.[Former] Oregon State Representative Kevin Mannix recently urged Nike to cut its production in Indonesia and bring it to his state, telling the shoe manufacturer that “there won’t be any transportation costs; we’re offering you competitive prison labor (here).

Private prisons have a lot more leverage to make up their own rules. Not only do they pay their prison laborer’s pennies per hour, but they also employ a skeleton crew of guards to lower their overhead, and convert prison infractions to work without pay and extra hours.

The bulk of our prison population are not in prison for acts of violence.

Ninety-seven percent of 125,000 federal inmates have been convicted of non-violent crimes….Two-thirds of the one million state prisoners have committed non-violent offenses. Sixteen percent of the country’s 2 million prisoners suffer from mental illness.

So in today’ economy in only make “cents” to break the law and go to prison. Since a large portion of our prison population are arrested due to illegal drug activity, it makes sense to deal with your current unemployment blues by getting high and just making yourself visible.

Since 2008 the US prison population continues to grow at a stunning rate. I also want to mention that there’s is a good chance that if you are speaking to a telephone solicitor or support staff that is not overseas, they probably are answering your call from inside a prison.

Even though prison life is not for me, who am I to judge. I grew up in a Midwest blue collar town in which factory work was viewed by many of us as a form of prison anyway. With its long hours, mind numbing repetition, and zoo like working environment, it kind of was like being incarcerated.

Yet, for the millions unemployed, without health care, in danger of being homeless and bankrupt being incarcerated with a warm place to sleep, be fed, get health care and a job might be a way to go. Heck, in a lot of prisons you even have the time and resources to work out, read, play sports and develop a rewarding hobby. Yet, in today’s competitive global work force, prisoners may soon have to jettison those luxuries so that America can stay on top.

It would be interesting some time to consider how much prison and non-prison life are becoming alike. The whole closed society thing is an obvious comparison between prison and military life. The amount of on going surveillance we are subjected to is beginning to mirror prison life as well as is how often we are patted down and scanned for weapons. With GPS systems and the like you could make an argument that we on the outside are being monitored and kept under greater scrutiny than the imprisoned. While our rights are vanishing in the name of protecting our freedom, prisoners rights have remained somewhat consistent.

The simple fact of the US imprisoning over 3% of its adult populace should call into question our referring to ourselves as the land of freedom. Add to that our obsession with surveillance and a need to police the world, and our claim of being a beacon of democracy is dubious at best. I’m not expecting Utopia but a little conceptual consistency and an occasional break from our stated ideals being oxymoronic at every turn would be appreciated.

Jim Guido