Zero Hedge: The End of the End of the Recession
It is becoming increasingly clear that most major sources of media feel invested in getting Americans to believe that the economic crisis is “over.” The far more likely reality is that our economy is in a major transition stemming from a variety of social, industrial, commercial and technological trends. In that scenario, it is unlikely that we’ll ever get back to “normal.” Instead we can keep an eye on what’s really happening and decide for ourselves, rather than pursue an illusory status quo.
In that spirit, you may enjoy this presentation by the hardcore investment punks over at Zero Hedge.
Keep thinking!
The End of the End of the Recession
Electricity going wireless
We forecast the progression of these technologies some years ago for some clients. Nice to see wireless power promising us a future without batteries (and likely with some other unintended consequences.)
Healthcare: Is it reform or transformation?
Abandon major media, talk to each other: a podcast
At my gym, they have those televisions up above the cardio machines. We have five TVs, and three channels: CNN, VH1, and ESPN.
ESPN is completely innocuous: sports news. Harmless entertainment. VH1 oscillates between retrospectives of 80s rock and some of the most mindless reality television in existence, basically tolerable.
C
NN however, has crossed the line. I have listened to them poke the corpse of Michael Jackson for two consecutive weeks. His father, his doctor, “It could have been a murder!” despite the strain of 75 different plastic surgeries. I can take no more. I find now that my exercise is no longer limited by my cardiovascular capacity, but by my ability to withstand the Stupid.
And then, today, on the crawl below the screen: “Bernanke says economy now better.”
I laughed out loud. I know that media is not really here to help us think deeply, but this was truly Kafkaesque. CNN is trying to inflame this poor singer’s death into some game of Clue, meanwhile commercial real estate will finish the job the subprime started. And then the pithy little crawl runs by, “Guy in charge says it’s OK!”
It is what it is. As I explain in the podcast below, this isn’t a moral judgment, but a business judgment. Formerly credible media are forced to take refuge in sex, death, celebrity, and calamity. Actually, they are really heavy on the death, since that’s a sure punch to the lizard brain.
YOU NEED INFORMATION. You just may need it from sources other than the media we have been trained to accept as credible. Again, it’s not a moral judgment, but one born of pragmatism. You are running a business, or your household, or a non-profit. You need data, and I’m afraid all you’re going to get from the media businesses is stories of Michael Jackson’s monkey’s motives for killing him.
On the bright side, you’re about to discover your inner pundit. So it’s all going to be OK.
Take care of yourselves; take care of someone else; build a great future.
Will house values drop like they did in Japan?
In forecasting, it is often useful to show trend lines in a graphical fashion. This way, you may see a pattern forming, and get the jump on a profitable strategy. I outline this method in greater detail in a book called Future Inc.
That’s why I love this gem, one in a long line of gems from Mish. For those who think our housing assets will hold value, he sees the value curve, and the associated thinking, as following the same pattern as the Japanese housing bubble, from which the country has scant recovered.
What do you think?
Disruptive Innovation and the Bankruptcy of Ritz Camera
by Eric Garland
I was just surfing SlideShare for some competitive intelligence – always a great source of left-of-center information, unusual sources, and stuff that never gets published. I cam across a provocatively titled slideshow about how digital imaging killed the corner camera shop. Even though the market exploded, the model shifted to one where there was no margin for customer service of any sort.
Food for thought for this Monday.
Innovation in Government!
Trading Fort Knox for CASH via cash4gold.com. This is Change I Can Believe In!
US To Trade Gold Reserves For Cash Through Cash4Gold.com
Dear People in Power: We’re Breaking Up with You
From the always provocative and thoughtful Umair Haque, an essential Dear John Letter:
The Generation M Manifesto
Dear Old People Who Run the World,
My generation would like to break up with you.
Everyday, I see a widening gap in how you and we understand the world — and what we want from it. I think we have irreconcilable differences.
You wanted big, fat, lazy “business.” We want small, responsive, micro-scale commerce.
You turned politics into a dirty word. We want authentic, deep democracy — everywhere.
You wanted financial fundamentalism. We want an economics that makes sense for people — not just banks.
You wanted shareholder value — built by tough-guy CEOs. We want real value, built by people with character, dignity, and courage.
You wanted an invisible hand — it became a digital hand. Today’s markets are those where the majority of trades are done literally robotically. We want a visible handshake: to trust and to be trusted.
You wanted growth — faster. We want to slow down — so we can become better.
You didn’t care which communities were capsized, or which lives were sunk. We want a rising tide that lifts all boats.
You wanted to biggie size life: McMansions, Hummers, and McFood. We want to humanize life.
You wanted exurbs, sprawl, and gated anti-communities. We want a society built on authentic community.
You wanted more money, credit and leverage — to consume ravenously. We want to be great at doing stuff that matters.
You sacrificed the meaningful for the material: you sold out the very things that made us great for trivial gewgaws, trinkets, and gadgets. We’re not for sale: we’re learning to once again do what is meaningful.
The changes coming up in business and government are not linear, not driven by technology, and most importantly, will not be driven by the same values. Not out of some vague sense of ethics, but mostly because the current/past system is really badly broken.
And that’s why people are going to break up with it rather than fix it.
Google Chrome OS: The last few 20th century business models break down
by Eric Garland
So Google is coming out with its own operating system, which shouldn’t really surprise anyone. It will likely be lightweight, simple, cool and functional like pretty much everything they do. And also evident is the fact that Microsoft should now be hyperventilating, as this development takes direct aim at its aging business model while also pointing at the future of computing.
Google is now threatening to bust the trust owned by the world’s richest man. You may remember a fantatastic, precient essay by Neal Stephenson entitled “In the Beginning Was the Command Line,” in which the author of Cryptonomicon and Snow Crash pointed out the near absurdity that the world’s wealthiest businessman made his money selling operating systems, as opposed to chemicals or railroads or minerals or something real and industrial. The untold riches in the production of user interfaces really did seem surreal at the time.
If you think about it, though, their business model was strikingly industrial in the Henry Ford, mass market vein. In the Golden Age of Microsoft, computers all hungered for standardization and interoperability if they were to function as something other than an electric paper weight. Whoever could forge that infrastructure could make stupid amounts of money – not unlike the railroad or the telephone. Not only did the infrastructure model pay off for Microsoft, they also harnessed Henry Ford’s mass production model, shipping out millions of individual boxes of “software” to individual users about the globe. It “scaled up” but at massive profit to the manufacturer.
And now you can officially say the 20th century is over. Even Microsoft, a digital age company, has succumbed to the new business models of the future. Google’s new operating system is harnessing all the aspects of the next generation business model. Google OS will be free, perfect for a variety of small, light devices intended to access the internet and cloud-based services. It’s not that you won’t be able to run Microsoft’s operating system and software tools – it’s just that they will no longer be the only game in town. Their competition will need to come from innovation, customization, and service rather than size, exclusivity, and scarcity that stems from limited technologies.
Record companies have learned this the hard way.
Newspapers are learning this the hard way.
Telecom is learning this the hard way.
No doubt, large and unwieldy, Microsoft will learn it the hard way as well.
Now…what about your industry? What will it need to learn? And will you be proactive, or will you be happier learning it the hard way?
Deleveraging the future – a bit more on the household savings rate
Courtesy of Mish, I just found a great chart that shows the economic behavior of American households as it pertains to savings. What I love about this graphic is the recognition that the 0% savings rate also occured at the moment of peak credit. When you’ve got access to all manner of liquidity, you are less likely to perceive the need for your own stockpile of liquid cash. And when the crash comes, you’re likely to go the other direction.
The main takeaway here is that we are in a period of deleveraging that may continue for years to decades. Households are leveraged, banks are in hock, the country is in major debt. Only two choices remain: get out of debt, or spin further into the fantasy world of fake money. Only countries have the right to make the latter decision – the rest of us have to start putting some black ink into the ledgers.
How do you think the deleveraging market will change your strategy?
About Eric Garland
Eric is one of the world's pre-eminent thoughtleaders in forecasting and strategy. He helps leaders of business and government make critical decisions about their futures.Connect with us
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