system two

system two
start-up thinking in the enterprise
Showing posts with label IMF. Show all posts
Showing posts with label IMF. Show all posts

Tuesday, 30 March 2010

"Threatening the recovery"

There is no recovery you donkeys.

You've splashed £170b.

1m more people are employed now than they were in 2000.

The public sector grew by 7,000 people last month.

The f**king Titanic would refloat if you pumped that much bloody money into it.

When you stop spending - that's when you'll "threaten the recovery"

And that day is fast approaching - either

because we'll have the other numpties in power

or

the nice people from the IMF will be telling us to chose beween the money taps and the lights

This is not rocket science....

Wednesday, 7 October 2009

A 20,000 year old bubble...

Bubbles are not the preserve of financial markets. One of excess cognitive capacity, unique to our species, has been growing for the last 20,000 years.

For millennia as we evolved, base emotions - fight, kill, f**k - drove our development. The result was perfect adaption to our evolutionary niche. Our small, but elegant brains became brilliant at constantly weighing up the options of fight or flight - sifting the odds, assessing the dangers.

Incessant thought and cognitive capacity expanded proportionally.

What this balanced system couldn't have predicted (or adapted us quickly enough for) was an era of plenty, and the exponential speed at which our brains developed as primitive farming practices, collaboration and culture took hold. This virtuous circle of improved nutrition leading to improved IQ, took our already impressive brain capacity, in evolutionary terms, from 0 to 60 in record time – too fast. Like so many species before us - we began to outgrow our evolutionary niche.

What do I mean by this?

We as a species, are programmed to think incessantly. This capacity was critical to our survival in a world of scarce resources. Now, in a world of plenty (at least for those of us who live in the developed world) instead of switching incessant thinking off, we mistakenly use it to obsess over the trivial - and in the process unconsciously create situations where it appears to be useful. This vestigial capacity - the mental equivalent of the coccyx - leaves the wheels of our minds spinning. Dysfunctional behaviour ensues.

But this isn’t the whole story.....

Incessant thought bore a second, altogether more trans formative fruit. As man’s intelligence reached a tipping point, from boredom and the increased awareness of the monotony and toil of a pre-industrial existence certain individuals - Jesus, Mohammed and the many history has chosen not to record – began to question the certainty of pagan dogma, their place within their group and the parameters of world they knew.

Those early outriders of independent, individualistic thought, sooner or later arrived at existentialism – the realisation of the ultimate meaninglessness of life. As the crisis of this questioning took hold (and at an individual level the panic of lonely despair set in, something we now call a mid-life crisis), a few leapt a chasm of understanding, and instead of despair, discovered peace – or “god” as some of them called, this new way of being. They discovered their ability to turn off their minds.

Penicillin, gravity the bomb – none of these come close to the significance of this discovery.

On the uncovering of such a monumental truth, a flourishing of healthy, rational, mental well-being might be expecteded to have taken hold. Having learned of this psychological escape hatch, civilisation should have evolved along these participatory, free thinking, humanitarian lines. The generosity of spirit, which this thinking prizes, should have been the foundation of a modern world order.

Instead, seeing the power of the discovery at first hand, and its ability to erode central authority, elites stepped in. There was a reason why most Christians were killed, hanging upside down. The message was pretty clear – don’t go anywhere near this way of thinking.

Out of this short term crisis was borne organised religion. The idea of "god" was co-opted and the real discovery of peace of mind - a holy grail or sorts - was buried.

This way of being. This joy of living. This is the real grail scripture talks about. This is what is unhelpful to a consumptive society, and ultimately, an elite which rules it.

The warped, half breed of the truth that was disseminated, contained enough of the original thinking to still be attractive to the human mind, and because of this it has created carnage. Unable to tame their rabid minds, man created rules, institutions and assumptions he considered “normal” and "moral" - which when viewed through a clearer lens of a calm, nonthreatening mind, appear ludicrous. You don’t have to go far into any aspect of culture or society - our foreign policy, our attitude to money, the IMF or “Western Democracy” to find bizarre contradictions at every turn. As a species we have internalised dysfunctional behaviour to such a degree the lunatics now rule the asylum.

So although we have an antidote - we ignore it for the poison that is modern living.

And yet, and yet.....this crazed movement bears the seeds of its own ultimate demise. Desperately, unconsciously, inadvertently, we are clawing our way back to the niche we fit. Collectively our conscious mind is destroying itself. Darwin’s laws remains in force.

By dowsing our world in toxic chemicals, destroying the very habitat that supports us and vilifying groups of people who could help us – we are recreating a world in which our incessant thoughts are useful. The 20,000 bubble of heightened consciousness is bursting.

*************************Updates************************

This on BB which seemed interesting here

and this

and this 

Monday, 30 March 2009

hedging your mortgage....


Having mused about whether Gordon will allow the slow death of the pound, I now find myself thinking more practically about whether 25% interest rates are around the corner, and if they are - what I can do  to make sure I don't lose my house.....

There is an argument that everything we've seen so far - bank failures, retail sector woes and growing unemployment is all linear, expected, presumed. Many people (including it seems those increasing the mortgage stats last month by taking out fixed rates) are coming to realise that this isn't the end. That the country, punch drunk from the blows of the last 6 months, is blind to the fact that far from being at the bottom of a hole, we're simply teetering on a ledge of an even larger crater.

Around the corner might be non-linear, asymmetric chaos - the child of deep, visceral fear.

Imagine the scenario. In 3 months time after a continued stream of bad news with confidence and output declining faster than expected, the UK domestic stock market tumbles when the government fails to bail out a major retailer / manufacture (they've already refused to help a bank this week....)

Secondary industries stall, confidence collapses, consumption dies up to a trickle and the pound starts to slide. Public unrest increases, people start going genuinely hungry, international money gets scared, a 2nd bond auction fails, there's a run on the pound and the IMF steps in.

Interest rates go to 25%.

Is this likely? Is it plausible? Even if there’s only an outside chance of this happening, hedging makes a lot of sense given the downside risks. And to do so is weirdly easy.

HSBC is offering 3.99% for 5 years with £0 setup fee which you can hold for 90 days. If, like me, you've come out of a flexible deal some time ago, reapplying for a product such as this every 90 days could be the cleverest thing you ever do. In fact, everyone, regardless of whether they'd pay an early repayment penalty should do it. In all scenarios it surely makes more sense to take the hit than risk having to service a £250,000 mortgage at 25%. Monthly repayments of £5,500 anyone?