Is Wall St. Now Just A Form Of Legal Gambling?

It’s really hard to tell the difference when one looks at the markets today to see any real difference from that of the floor of any casino.

For all intents and purposes financial shows seem to be more concerned with showing great legs on-screen as much as some sports broadcasts are pushing to have their female equivalent commentating from the side lines. What’s next – a cheer-leading squad of scantily dressed talking heads waving pom-poms every-time the camera pans? Sorry, I forgot…That’s CNBC™.

I find it almost uncanny in just how the once bastions of free market capitalism are morphing into both the look and feel of today’s casino. If you look at the myriad of assorted slot machines on a casino floor one can’t help but notice that all the lights and sounds with their inner entangled games within games seem to have all the color pallets and changing graphics of most trading screens.

“Look! You got three gold bars, Oh so close to the winning combination, but wait – here comes the free bonus round where you can win a great second chance. Just watch the screen above to see if you get that winning combo!”

Is it really all that dissimilar from today’s day-trader locked in their basement or “trading room” in the dark with screens flashing multicolored candlesticks with “alerts” ringing and buzzing to alert one “the three gold bars” have just been hit. So look to your other screen and see if the 50 MA crosses the 100 MA and claim another prize!”

Whether it’s on the trading floor or in one’s own trading room there will be at any time from one to multiple television screens showing the “box scores” ticketing across the screens from multiple sources with pre/post game analysis, game players, handicappers, et al touting exactly when, where, and how the next big game is about to unfold or has ended.

Who needs football, or basketball and all the others when the stakes for handicapping the Federal Reserve Bowl is about to take center stage at any given time?

Whether you sit directly at a casino table, or you sit at your own virtual one. The same sort of rules apply: Sure your playing against other players, but you’re all playing against the house.  And today that house is Wall Street where the actual bank is now solidly owned by Central Banks.

The equivalent of floor managers are the direct dealers of Treasuries with the keys to the “discount window.” Pit bosses are the regulatory agencies. And the croupier? Fill in you favorite discount brokerage firm ___________ here.

Nowadays more and more it seems everyone is only truly betting on one outcome or the other: Will the Fed. do this? Or will the Fed. do that?

Who cares about what it means to things like the economy, and more. All that’s cared about now is the “win.” i.e., Do they keep interest rates at near zero for another month or not?

Who needs to wait for a Super Duper Bowl-arama type event once a year when you have one you can bet on every month in the form of some kind of Fed. announcement.

Odds makers layout the spreads and more in detail via most option platforms that are available from near any discount brokerage house. These platforms now move with such swiftness as well as up to the near millisecond speed it brings a tear to the eye of book runners of yesteryear.

Banks themselves act as the “booking agents” where one can place their bet right directly into their own bookmaking brokerage platform. Just deduct it from the 401K account.  Don’t worry about the vig – “you’re a valued customer when you use XYZ’s custom platform with low, low commission rates.”

Tongue in cheek? Sure, but in reality – just how far off is it really?

Nowadays the markets have far less to do with capital formation than they do with the A or B choice of what the Federal Reserve is going to do today vs tomorrow. All one needs to do is figure if, or how, they’ll play the alpha of the move, or the beta. Can, and will, the carry trade cover the spread if it all goes against one? Will the counter-party be there to pay up? (Remember the MFS™ debacle of not that long ago?)

The only discernible difference I see from the Wall Street version of a casino it’s now so prominently become, and the one we find on some island or strip is this:

At the least, when I have a great winning bet placed on Red or Black…

The odds that someone from the house bank coming down to floor and yelling “Fire” as the wheel is about to stop right on my stop is far, far less than a Central Banker coming out touting “Well maybe we should or shouldn’t do…..” the moment the true free hand of market is about to expose itself.

At least at a true casino – they do have some level of integrity.

© 2014 Mark St.Cyr

Leadership 202

The glass half empty analogy: and why the simplistic view can not be the focus for leaders.

Whether you’re in business, politics, or some other position where your job is to lead others in a cohesive way. A term that will come to mind more often than not when issues arise is the mantra: How do you look at a problem? As the glass half empty? Or the glass as half full?

In its simplistic form we use it as to help people in understanding there are two ways to look at an issue. i.e., Things could be worse. Or, It’s not as bad as it could be.

However, as a leader you can’t take that small of a position when viewing the glass. You must distinguish the reason or reasons for why the glass is half full. In other words: Was the glass full where now there is only half left? Or the flip side: Was the glass empty, yet now it has been filled, but only half way? And one that many leaders skip entirely: Is the glass half full or empty because half is all the water there is to be found or lost?

It doesn’t take more than a glass of water to observe the job of a leader is to have far more observation and inquisitive reasoning skills than most others. It’s points like these that bear out the reasoning and understandings that fall on many deaf ears that leadership is a skill that constantly needs to be honed.

Far too many get into a leadership position and think, “Whew…made it! Guess I do know what I’m doing. So now I can just hide out here in my new fancy digs and “lead.”

The “lead” part doesn’t come with a title. Many so-called “leaders” have found themselves with their backs against the wall all by themselves when their subordinates are not only remaining on the other side of that wall – but have locked the door to make sure there’s no way the “leader” can reach them as to give further orders.

Remember that other old sage: If it were easy – everyone would be doing it.

The viewpoint, the decision-making process, along with the decisions themselves are diametrically different as to challenges facing “a glass half empty” because it’s draining as opposed to “a glass half full” because it’s filling.

You can throw in a few other variables that a great many also miss and has in itself another complete set of issues that have to be dealt with in different ways: The glass is half empty because it’s just been left to stagnate and evaporate. Along with: The glass is half full because it’s in a place that occasionally drips or pours water into it without any intervention by the glass owner.

These are not distinctions without a difference. They are radically different issues that must be addressed sometimes employing diametrically opposing remedies.

Let’s use a hypothetical example where the exact same issues can be transpiring within an organization yet, they are for two completely opposite reasons.

While both may fit into the “glass half empty” scenario. Again, the decision-making process, the way that process is conducted, the way in which others need to view the reasoning’s of the leader, along with gaining consensus and building a cohesive action plan that people will both follow and help to achieve – is very different.

Example: A company is having severe worker orientated issues that is both effecting customer satisfaction along with customer retention. Workloads per department as well as employees have been increased by as low as 25% to well above 100% in some cases.

Although the process of hiring staff is onerous the HR department makes clear they are being bombarded with highly qualified resume inquiries. It seems everyone wants to work here. Sales are up 30% this fiscal year and backlogged sales estimate the beginning of next year sales will be even higher and profit margins are good.

However, you can’t seem to hire personnel quickly enough to handle the surge. This is also causing customer orders to be riddled with mistakes causing returns, customer dissatisfaction, and customer abandonment. Yet, you’re outgrowing your present location to handle this workload and what you really need is more space to handle all this growth.

Add to this, it would seem your competition is falling by the wayside as you gain more and more market share. Sounds like a perfect problem that fits the “Glass half full” analogy. For at least these issues are from growth – correct?

Not so. This is where careful analysis, an understanding of exactly what questions are to be asked for clarification, what are the true reasons for why X is producing Y, what is to be observed and what is to be overlooked. etc, etc, is imperative.

What many “newly minted” or “book trained only” leaders will do when faced with the above listed overload rears itself – is to seek counsel or advise based solely on the above criteria.

The problems and issues seem ready for text-book solutions and procedures to follow that will be heralded as “The thing to do in these situations” from outside sources. However, it just might be the exact opposite of what is needed and will have disastrous effects down the road.

Why you say? “For these are great problems to have!” One should be optimistic for the “glass is half full!” It could be worse: there could be no sales, no expansion, little work, no one wanting to work there, and more. “These are issues one should be happy with” you might conclude.

And, you might have a point. However, what I just described in the above scenario was not caused by growth. Its causation is borne out of the exact opposite. i.e., the final gasps within a dying industry.

You can envision this scenario happening at companies during the transition from CRT television manufactures when flat screens started to take hold. Vacuum tube manufactures when transistors were first gaining steam. Video stores as entities like Netflix™ or even Redbox™ first gained acceptance. The list goes on, and on. Along with the other variables as to “why there is any water in the glass at all?” as being a very pointed question that must be addressed and understood by a leader if they are truly serious about leading.

It’s not all that hard to get people to follow you into battle if they believe you know what you’re doing and have the fortitude to address the issues in a cohesive well understood pragmatic fashion. Even if they know you might not currently know the answer to every question. It’s in their knowing that you will seek to find those answers is what gives you their trust as too lead.

What they will not do is get behind you when they instinctively know what’s really happening is the exact opposite of what you’re saying. Unless it’s to push you out in front to be used as fodder – as they run for the hills.

© 2014 Mark St.Cyr

Let Them Eat – Student Debt!

This past Friday I like many others were waiting for my comedic coffee break to be broadcast over the financial media outlets. When the set up was told I grinned in amusement and expectation. When the punchline was delivered I almost fell off my chair as I buckled in uncontrollable laughter. That punchline? The unemployment rate now stands at 5.8% Now that’s comedy!

Just when I felt my sides couldn’t take any more unbeknownst to me the preceding line of comedic humor unleashed by the so-called “smart crowd” was one line of ridiculous humor laced drivel after another.

What made this whole laugh-fest turn from outright humor to a living tragedy is that many of the people discussing these “facts” are both in positions of power, or worse, positions of teaching. All I could envision as I listened was George Carlin looking down saying, “Man I need to get back there. What material! Who’s in charge here I need a cab?!”

The more one listened to the analysis given as they dissected the data – the more the laughs kept coming. It was a bonanza of comedy from one channel to the next  as it seemed financial media morphed into its own version of a standup open-mike show across the spectrum.

A few points that were laughable but made me down right angry is the continued comparison as well as instructional overtones we are told to perceive from Europe and other countries as they deal with their financial mess and unemployment horrors.

I have nothing against these other nations, however, what I do hold vehemently too is the fact: the more these pernicious meddling intellectuals try to solve our problems as if our solutions will come from following what’s happening over there? The more problems they create here. For I would like to remind the chin scratching set – We are not Europe nor anywhere else. Period!

Just for the record I would like to point out one or two general observations that seem to get lost (or purposely ignored) by the parchment pundits.

First, to the casual observer that has to actually start, run, hire, and all the other mundane things the intellectual crowd seems to have never done, I can’t help but notice; the more they treat or espouse solutions to U.S. issues as if we were under a monarchy or imperialist rule – the more stagnant, wage disparate, over regulated, job killing, centrally planned, __________(fill in the blank) problems we seem to have.

Imagine that, who’d a thunk it?

Second: If I hear one more so-called financial commentator be regarded as “brilliant” for his/her comparisons with other time periods in our own history as well as other countries using data points, charts, and every-other bottle of snake oil they can pull out of their wagons to show the “healing effects” all this has had on the U.S. economy. While conveniently leaving out the stubborn little fly in the ointment – QE was never present within their comparison data sets, I’m going to scream.

None of it is relevant in direct comparison if: there were no interventionist policies of size and scope relative to 4 Trillion dollars of QE during that comparison. Period.

We are in uncharted waters with no charts, no maps, no guides, no nothing to compare where we are. We are currently making and writing the history daily.

Again, not only at best is most of the data points irrelevant. At worst saying that they are – is intellectually dishonest, and dangerous thinking. But this is what passes today as “Intellectual, and informed financial analysis.”

I heard one discussion when reflecting on the widely glossed over U6 data (the stat that gives a more informed picture of employment health or weakness) that the “trend” is going in the “right direction.”

Well, yes it has but (and it’s a very big but) that’s according to the Bureau of Labor Statistics (BLS) data. You know, the same one that brings us the 5.8 current unemployment data point. (I still laugh just typing that)

Other reports such as Gallop™ (who by the way are actually pretty reliable when producing data) disagrees with the BLS# at 11.1 and reports their findings more at around14.8% and flat-lining at best.

No matter how you slice it one thing about this stat can’t be brushed under the rug to anyone serious about the labor force. Today over 90 million people in the U.S. available or able to work – are not.

So when the discussion of improvement using the BLS number as to be “pleasantly surprised that the vector of the data is showing improvement in the right direction” what are we really talking about here?

Should we be encouraged (as a hypothetical) we went from about 92 million people in the U.S. labor force unable to find employment to let’s say 91.5 million?

Outraged is what comes more to my mind more than anything else. I guess that’s because I don’t have a parchment for if I did, well then – this would be great news! Sorry, its more like pathetic news in my opinion.

What’s just as pathetic is the intellectual argument that for the many that can’t find jobs, “They are smart to be staying in school.” When I heard this my thoughts went immediately to how this was so reminiscent of history’s immortal quote of the 18th century when then Queen of France Marie Antoinette in reply to the citizenry not having any bread to eat famously replied “Let them eat cake.” Is it any wonder why we’re in such dire straights?

Is taking on more student loan debt as to not have to face the cold reality of the real world not that dissimilar than eating cake for nourishment in the place of bread? Once again this is coming from both the intellectual crowd as well as the policy making crowd. I would just like to remind everyone how that all ended.

Today we see actions by many groups calling or demanding wage increases; especially when it comes to the minimum wage. Yet, isn’t the real underlying issue more in line with what was once an “entry-level” position filled by teenagers has now turned into the only positions available for the now “entry-level, unskilled, first time employed, degree bearing” 26 year old’s and older?

The very one’s whom constantly are being told by the “intellectual crowd” then burdened down with oppressive debt (which continues to fund as in employ those very same intellectuals) to accumulate degrees in some aspect of business (or whatever) that for all intents and purposes will be of little value. To then find themselves competing with others in similar situations for that “minimum wage?”

All that school and debt for what? To keep intellectuals employed? (Those are two questions that demand serious honest answers in my opinion)

I wrote an article years back dealing with this whole phenom titled “The Problem With Kids Today: They’re 26!” I feel stronger today about my assertions than before.

We are on a collision course that inevitably will end not in a hangover from a celebration of gorging on “cake” rather, on the harsh reality of many finding themselves suddenly thrust upon a starting line they needed to be competing at a decade earlier, malnourished, overweight, with a ball and chain affixed to their ankle in the form of student debt so large in size – it could be used to anchor an aircraft carrier.

Again, for I can’t make this point enough in my opinion. Show me a data point and chart where you want to explain why housing formation seems to not be doing what the analysts first pondered – and I’ll point out the absurdity of comparisons if you don’t equal into the equation the amount of people not even beginning serious life or working careers till near 30 years old! (re-read that number again for it says a whole lot more than near anything else)

It’s one thing if you need a degree for some sort career as a prerequisite. i.e., Doctor, lawyer, et al. However, to be encouraged by both policy makers as well as the intellectual elite to stay in school “as a smart decision” as a way to insulate oneself from the current employment consequences transpiring throughout the economy is nothing short of channeling 18th century European styled thinking that for over a century was repudiated in the U.S. and produced a middle class which was envied the world over.

Let me add just one last thing to back my argument on this whole idea of “the value of a degree” from what it meant just a few decades prior to what it has become now…

If you are an MBA holder from some Ivy league Alma mater, chances are your “Ivy league” cherished moniker might get you first in line position ahead of others competing for the same job opening at a major international corporation. Only problem is?

The position maybe for the reason: It is cheaper to hire you than to purchase upgrading to the “Auto-burger Flipper 2000.” But don’t worry. I hear the policy makers and intellectual crowd is promising there will be even more desert later. And they’re willing to finance you for as much as you can eat. Bon appétit!

© 2014 Mark St.Cyr

You Just Can’t Make This Stuff UP

Recently I wrote at length my feelings on search and more about the way it now has become (in my opinion) a near farce or maybe better stated; a complete waste of one’s time in using many earlier features or processes to find how much impact one is having upon the web.

For the record. As I type this just one of my latest articles was presented to an audience of both millions as it was carried via 3 of the top websites in the world, along with being distributed to all their own social media platforms, news feeds, re-blogging, and far too many others to mention. And what did I just receive telling me I was in so many places mentioned and printed by name? Zip, zero, nada, squat as always.

Then out of nowhere I received this. Ladies and gentleman I present to you exhibit A of this weeks “You can’t make this stuff up!”

Screen Shot 2014-11-05 at 7.52.05 AMAs I stated in my earlier piece. If you do the things these people tell you to do this basically shouldn’t happen. Not only that, they imply that if you do do things that make things like this occur – they will penalize you in ways even the inquisitors of the 15th century would think, “Yikes! Now that’s severe.”

So what can be garnered from this? Well we can spin it two ways.

One: This shows undeniably that most of the metrics many are chasing are now irrelevant. For as you can see. If I place my attitude, my business decisions, and few other things based on what “the web” is saying about me right now as we both sit here – I’m having no impact, or anything else for that matter. Just on my own site. And like I said in that article, “If I only have one person coming to my website and I’m happy with that…” (for the reasons I stated) It would be fair to assume that the only viewer, reader, or follower I have is probably my mom. And based on this evidence – you would have a very fair, hard to repudiate argument. Or…

You could put your (snake-oil) marketing or public relations jacket on and proclaim: The search engines find my site as the most important site as to be mentioned or appear on. So much so to the exclusion of all the others. For as the search shows by their own metrics used – this site (my site) is by far the most important, dominant, and informative on the web today.

Of course that’s tongue in cheek and one would be fool-hearty to even indulge that scenario with any serious thought. Yet, this is exactly how many are treating their work or businesses on the web. Kidding themselves as to if they are – or if they aren’t creating impact or doing real business. For too many as I said “are chasing vanity metrics.”

Don’t be fooling yourself or chasing your own tale (pun intended) when it comes to all this stuff. Get a true understanding of what is real and what you can truly build a business on. You can do it, and it can be done easiest – through hard work and effort. For there are a lot of people that want to sell you exactly: how you can make this stuff up easily. Don’t let them kid you. Remember: the worst person in the world as to try and fool – is the person you fool in the mirror.

That’s the one place where you don’t want to make stuff up.

© 2014 Mark St.Cyr

A Few More Thoughts On Music And More For Today’s Entrepreneur

I discussed my feelings on some of the aspects of music and writing here. And what this prompted almost to a person were questions on how I viewed the debacle that took place with the Apple™/ U2 free album sent to every new iPhone™. Where the album was placed within their music library for free without the customers firsthand knowledge or consent. Here’s how I answered it…

First off, the whole “I’m offended” meme that ran rampant in which droves were complaining because they received something for free but weren’t asked was in my eyes a little disingenuous. I mean as one of my favorite comedians Joan Rivers would say, “Can we talk here?”

I really don’t think it had anything to do in any aspect with U2. Sure it’s possible the many that complained were either too young to know who they are, or live on some remote island. But far too many (including both U2 and Apple) then, as well as still, continue to be focused on the wrong issue in my opinion.

I use this one particular issue as an example because that was one of the many lines repeatedly touted across media as to why people were complaining. You saw lines like, “WTF! Who the heck are these guys anyway?” Like I said, “c’mon…”

With all that said, I feel it did give an insight into exactly how the iPhone or other mobile devices are now viewed in today’s society. I think there was a great lesson buried within that debacle as far as I can see and was missed altogether by most. And not missed in the sense of “just not paying attention.” Rather, in missing or even understanding of exactly what was exposed.

In broad brush terms: The smart phone, regardless of brand, has now replaced what was once thought of or identified with “part of your identity” as in say a car, a home and items like that. Even down to the smaller things like, a diary, a secret box, or secret garden.

Whatever it is we now know one thing clearly: it’s personal – deeply personal. As well as revered. And who enters, or who we let see or touch, is inviolable. Period.

Let me describe it this way using the car example.

If you had let’s say a “cool car.”  Even if we knew one another. If I decided in the middle of the night to add a really cool cup-holder to the console without you knowing as you slept and had your car parked in the driveway. Locked. Can you see how one might take a little issue with that?

The cup-holder might be secondary, I’ll argue it’s for the very fact I entered your private or personal effects without permission and circumvented your locking of it that would make you take umbrage.

Even if the cup-holder is “the most awesome cup-holder since cup-holders were made” you might for what ever reason not like it. Or, not even drink liquids in your car. The umbrage might go to outraged when you find that not only don’t you like it or want it – you can’t remove it. Which by the way was also the case in this very debacle and the real critical factor for outrage in my opinion.

This is how what one thought as being a nice gesture turns into “WTF were you doing in my car in the first place! Who gave you permission? What were you thinking? Get that piece of #### out of my car before I call the cops on you for breaking and entering and destruction of personal property!”

Again, see how this can move from good intentions to bad idea quickly?

Same thing let’s say if the local grocer decided to do something wonderful for all their clients and gave a free turkey to every household. Everyone would think that is just terrific. Yet, if you came home to find that turkey had been placed in your refrigerator by some store clerk whom entered your home while you weren’t there – or anyone else? Thrilled will not be the term that comes to mind.

Think this doesn’t apply to even the youngest of demographics? Just try to give a wonderful thoughtful gift in the manner of sliding into the back of a 13-year-old’s diary say a $10.00 bill.

Just put that bill in the back of their secret diary to be found by them when they least suspect it as in “a surprise.” You’ll be thinking “I’m such a great parent! I give my kids money when they don’t even ask me for it.” Then…

I’ll bet dollars to doughnuts what you’ll hear will be something more reminiscent of the 13-year-old screaming bloody murder for you “violating” their personal space in a “How could you!!!” tirade.

You can plead to them how well-intentioned you were and to believe that you never even opened it. Yet, it won’t matter. It’s the act you were in their “personal space” is all that will matter. You don’t belong anywhere near it unless “invited.”

The ability to give away promotions or anything else is far from dead, and I believe will be used in even more instances going forward. And yes directly to “the personal device” aligned market.

However, the key take away from all of this was the demonstration of exactly how most people feel about their devices. They truly are just as personal and have many of the same attributes that one would expect if dealing with someone’s home, car, and other personal space or item.

Just because you have the ability to deliver a present in fabled Santa Claus fashion doesn’t mean people wouldn’t be both offended, as well as outraged, while calling for the authorities if they found you standing in front of their fireplace with a new expensive gift as they woke from their beds.

That’s fairytale land. In the real world – if someone wakes to find an intruder dressed as Santa Claus in their home? They’re going for the armaments first. Trust me.

If the U2 album would have been released as “To all new or existing phone users: You are entitled to download for free the blah, blah, blah as our way of saying Thank you for choosing us just click here, blah, blah, blah.” All of this would probably never have seen the light of day.

In this manner or form I think there would have been no fuss, and maybe even some great press. But, you learn as you go, and we are now still in learning territory. But (and it’s a very big but) there was a lesson to be learned here – and one that should be well remembered.

Personal devices such as phones and others are just that – personal. Just because you may believe you have an opaque understanding with your customers where you may have access or something similar, (as in there’s some line in a contract) you need to tread very, very, very (did I say very?) carefully.

People know instinctively if they did find you in their home or personal space for the reason of dealing with, or in answering to an emergency, there’s a fine line of accepted understanding. e.g., To find your landlord in your apartment because your hot water tank let go and was pouring water across the floor wouldn’t warrant you feeling violated or something other.

Yet, when it comes to interactions with customers where you can enter these now identifiable personal devices at any time: You would be best to view them as just that – personal. (that also goes for peripherals such as email, apps, social networks, et al)

To do anything less will only be seen as some violation of privacy – regardless of the good intentions that were trying to be displayed.

After all, just remember: A landlord has the written right in most tenant leases that they may enter that dwelling at any time. However, If they do it without the lessee’s knowledge or without a real good reason?

Consent in the paperwork goes out the window. As far as you’ll be seen going forward? You might turn a once happy tenant that viewed you in a pleasant light – to an angry customer that now just views you as some creepy landlord they need to get away from.

© 2014 Mark St.Cyr

A Thought For Today’s Entrepreneur

The more thing change, the more things stay the same is the line we’ve all heard thousands of times. The problem is that sometimes we really need to remember the reasons why we’ve heard it so much.

More often than not it’s because – it’s true. And it happens far more often but exactly; how it happens, is where many fail to see the bigger picture behind the snapshot of the time.

Today I would like to draw your attention to someone as well as something that has implications far more broad and far more sweeping than what anyone now even considers, let alone “thinks.”

Today it was announced via many media channels that Taylor Swift pulled her entire catalog off of the streaming music titan Spotify™. Whether you like her, don’t know her music, (she’s today 25-year-old pop sensation) or anything else about her, what you can not do – is not pay attention to this action by her in the bigger picture if: you consider yourself a serious entrepreneur.

In a nut shell what she has done is this: She has taken action in demonstrating it’s not up to others to give away or pay shavings of a penny as to the originator and property holder (as in copyrights, trademarks, et al) of a said material. Then to make money or a business based on that artists material unless both sides have agreed to the terms. And she clearly does not.

But you can’t make that call unless you own those rights!

Owners decide where, when, or how their property is distributed. Not the distributor. Remember – Ms. Swift creates Ms. Swift products. Not Spotify or anyone else. And while Spotify or anywhere else might be a great place for someone to go listen to Ms. Swift’s products. Without her – they don’t have a business or a product to sell. (over simplification but you get the gist)

In today’s world of people (and I am speaking directly to entrepreneurs here) putting out everything they have, everywhere, for free. The question must be asked as you look in the mirror: If you put your product everywhere, on every platform for free – who in the world is going to ever pay you for that product? Ever?

I absolutely stand up and applaud Ms. Swift for what she’s doing. At 25 years old she is showing more fortitude and business savvy than people I speak with running major conglomerates that are more than twice her age.

I addressed this is an earlier article on how I summed up the Amazon™ vs Hachette™ battle. Don’t let this now seemingly “not that big of deal” get lost on you. For it’s far more to shape into a true ground shaking event if others take notice and follow her lead.

For those that may have forgotten, this is not that dissimilar than the first cracking in the “peer-to-peer” war that took Napster™ and that whole idea of “music should be free for everyone” meme back in 2000.

Remember when Metallica (the now world dominant heavy metal band) shot the first salvo across that doomed ship’s bow when they sued? (where even a great many of their loyal fans cried foul)

Then they stuck to their guns and said (I’m paraphrasing) “It’s our music, our songs – we decide – not anyone else!”

Suddenly Napster went from the darling of “freebies” everywhere to not only bankruptcy court, but many would say (me included) was the rebirth of artists actually getting paid once again with the introduction of iTunes™.

Whether the subsequent deals going forward were good or not is irrelevant. Artists once again had some form of control of their music.

And once the catcalls calmed down, Metallica for all the bad press and fan bashing they received during that process went on to be both bigger, as well as stronger. I believe this isn’t that far removed from this prior episode in “paying for content” history.

You don’t have to be a fan of Taylor Swift music. However, if you’re a fan of entrepreneurship and business fortitude? You can’t help but sing the praises of her tenacity to decide exactly how, or where her business is going to be both presented as well as available. (as in sold)

Far too many are worried about their vanity metrics. (likes, followers, etc.) It’s refreshing to see someone so young in a world dominated by those same vanity metrics be concerned with what’s most important. Being true to their business – not just the vanity.

She deserves kudos in my book.

© 2014 Mark St.Cyr

Keynesian Shangri-La From Myth To Reality

In less than the time it takes for a chrysalis to release one of life’s remarkable transformations, many once called “capitalists” woke to find the world they once knew changed into something only dreamed or told in folklore.

Where business models resembling unicorns abounded along with rainbows in their resembling equivalent of over-arching ETF’s. All available in a multitude of hues and proportions so plentiful: It was hard for one not to well up when contemplating. For in this new fairytale land there must certainly be a pot of gold at the end of every “rainbow.” However, one would be mistaken. For one must remember this is a “Keynesian Shangr-la” and gold here is useless. (insert choir music here)

Today, at the end of these self propagated rainbows lies a Central Bank ready and willing to print as much money as one needs to see those vivid colors so plainly; only the term Technicolor® seems appropriate as a descriptor. (no special glasses or headset required)

Although the above is a bit tongue in cheek what it isn’t sadly too say: is fiction.

We now have entered a time where what you once knew or thought about capitalism is out the window. At least when it comes to the global financial markets.

What was once the bastion of “free market capitalism” has now metamorphosed into what the devotee’s of Keynesian economics have been chomping at the bit to unleash and install. And that day is – now here.

The only bug in their soup they forgot to remember while they’ve been drooling in anticipation, waiting for its possible arrival is this: Be careful what you wish for. For you just might get it.

The Keynesian argument has been made for decades. I wonder if the man (John Maynard Keynes) would be impressed with just how much his ideology is so vehemently held in the halls of academia and political circles. Many religious devotees pale in comparison.

Once upon time people believed in free market capitalism. The relationship with the money supply. The economy, markets, interest rates and their effects on keeping governments spending in line. All that and more is now out the window along with the old draperies. No need for those silly viewpoints nor those curtains because there’s no longer a need or even the inclination as to try to hide.

You don’t need anymore proof to show this over enveloping viewpoint than the front-page story highlighting none other than Keynes himself with the headline on Bloomberg Businessweek™: Stimulate This!

But maybe it’s the subtitle that really gets to the heart of the matter: “John Maynard Keynes has the last laugh on what works for the global economy”

Oh that tagline just might be the very thing that produces more tears than laughter in the end. As I stated earlier “Be careful what you wish for. For you just might get it.”

A few years ago I made this point when trying to get others to understand just how far the interventionist monetary policies had permeated the capital markets. I remember people taking great issue with me as if I “was going too far.” It seems now in retrospect just maybe – I hadn’t gone far enough. Here’s a few quotes from that article:  Welcome To Keynesian Shangri-La

 “Valuations – schmaluations. Please spare me. It might make for good time fill in the financial media’s “power rotation” of talking heads however, to anyone with just a fair understanding of business. The economy can’t be spitting out numbers just over stall speed of a recession with all time highs in the stock markets as something that’s even close to resembling healthy.”

“To the Keynesian or the government has all the solutions devotee, everything looks just as it should. Turn on the television, radio, or pick up a paper and the headline reads, “Record High!”

So here we are just a few years later to find ourselves floating in a sea of printed or digitized dollars looking for a home. And that home is in an increasingly shoddily built, underpopulated, (as expressed via volume) maintenance plagued financial arena know as “The markets.”(remember how many times the markets broke this week alone?)

But it would seem we have traded one slumlord for another. Exit the Federal Reserve and please join me in a warm round of applause for the Bank of Japan. (insert hysterical cheering crowd of Keynesian economists and lackeys here)

What has now garnered the moniker of “Banzainomics” leaves no doubt that we have entered a time in financial history that belongs totally and squarely upon the shoulders of Keynes.

Problem is – where Atlas may shrug, there’s a real and true strength as to carry the weight. For Atlas it’s about risk reward. For this new Keynesian metaphor? When and if a shrug is needed; it won’t be out of risk reward.

It’ll be out of losing its grip and collapsing under the very weight they told – and sold – everyone on. The idea, that if they would only “give him the ball” tranquility and fear from “capitalistic dogma” along with its pervasive repercussions would finally be eradicated.

Well – Now he/they got it.

Problem is without a never-ending supply of steroids and other substances (in the form of monetary policies whether legal or not) the myth of strength will transform into the reality of weakness.

Then as he falls apart he may decide that rather than taking another injection he’ll just shrug the weight off and reach for the remote or XBOX™. For remember, in a Keynesian world: Hard work is for Atlas, not him/them. Besides, can’t one get that injection and still be on the couch? In a Keynes world. Why not?

So why does this matter to today’s entrepreneur or other business people. Easy…

So now you’ve created this great widget, company, what ever that you’ve grown through hard work and more where you believe it’s now time to access the capital markets.

There’s a problem now. Those markets aren’t for “capitalists” any longer. They’re for “Keynesians” and if you aren’t the right investment, or in the right ETF – you’re toast.

You might have a great company, but if a Central Bank deems there’s “No money” to be had this month, you’ve got crap.

The flip side is also the same. Say you’ve built a better mouse trap than your competitor? Sorry, they’re in the right ETF and you’re not? Sorry – No “soup” for you.

Oh that’s nonsense you say “you’re being over simplistic.” Fair enough, but there was also a time little more than 4 years ago where “monetizing the debt” was laughed at.

If you even made the claim you were shouted down as some “tin foil cap wearing, conspiracy theory, fear mongering, blabber mouth.” And now? Not only proven fact, but stated as an “effective policy tool” aka QE.

Which leads us all right back to today.

For decades Keynesians have deplored true “capitalism” as a form of cancer than must be eradicated, for it does nothing but bring on booms and busts leaving devastation in its tracks. Where the altruistic Keynesians profess if only they were under the world in place of Atlas; they would show one and all exactly what they are capable of doing. And today – here we are. It’s their world.

For over two hundred years the strength of Atlas (warts and all) has brought about the greatest economic super power in all forms of measurements from quality of life, to military strength to protect that life.

Yes there are booms, and yes there are busts. But they are necessary and needed just as the underbrush in a tranquil forest at times needs to burn off to make way for newer even better growth.

During these times it seems there is nothing but devastation and turmoil. So too does the inner workings in a capitalistic market place mirror this.

It’s in the folly of thinking it can be surgically dissected and removed from out of the cycle where the Keynesians get into real trouble. For the more they meddle, the worse the ramifications, like an over eager plastic surgeon stating “We can fix that last nip tuck – with another nip tuck.”

Then they’ll blame others in a fury of finger-pointing for why “their meddling” doesn’t or didn’t work. “You didn’t allow us too spend enough, or, at all.” However that is no longer the case.

Not only do they have the check book, but the credit cards, safe deposit keys, and even a few neighbors assets they’ve yet to realize are gone. It truly is “all in their hands.” (and pockets)

Not only do they have the above, they have the whole ball. (Yes, the globe – as in the global financial markets)

Here we are at never before seen in the history of mankind market highs. Not only is there so much money floating around, it’s been decided by another Central Bank to increase that level. For they have taken that immortal line given by President Kennedy “A rising tide lifts all boats” to an even near unimaginable level.

Forget boats for we are truly in the Keynsian Shangri-la of: Those that have – those that have not – and those that have yachts!

The inherent problem to the Keynesian model also lies within the very thing most coveted by the Keynes devotee: Who do you blame when it all falls apart? You can’t blame capitalism or Atlas. You’ve shrugged him off. It’s now all on your shoulders.

For well over two centuries the Atlas’ of the world proved more than willing, as well as capable, to bear the burden of holding up the economic world. As of today the marvel of Keynesian economics is now front and center with no question as to who is in control. Without a doubt: You’re in control.

Since 2008 those policies and practices have been implemented with near little opposition. And now with the other Central Banks ipso facto picking up the baton even before it hits the ground proves; we are now living in a “Keynesian Shangr-la.”

You’re now just 5 years into complete and total economic control via Keynesian policies, while simultaneously gaining even more followers and devotees. This truly is a historic time we are witnessing.

I leave you with this one thought for its something I penned a long time ago when all this meddling first began…

“Markets right themselves with pain… That’s Capitalism.
Back room manipulation to avoid pain only increases the severity of the pain to be felt down the road.”

You’re in control now and best of luck. The rest of us will go on about our lives in business dealing the best way we can as to navigate this new world you’ve created, but one small warning if I may.

Since you now have the weight of the financial world on your shoulders you’re not going to do the one thing you most want…

The ability to pat yourselves on the back.

© 2014 Mark St.Cyr