Vapour Trance

So, ‘our’ security services have been so unbelievably fantastic, that they warned their governments all over the Western World, that ‘Sunni rebels’ were going to start invading Iraq and scaring the army ‘we’ trained and set up so well (at some cost), that they pretty much all upped and ran away when it mattered.

DJ Nigel Good (not the politician!).
Hoodie yes, but not a terrorist.

And doubtless, they - the security services - amassed all of this intel by bugging private citizens everywhere.

I can’t wait to see what happens next - this time I’ll be stockpiling lots of packets of chips and other snacks and cases of Coca Cola to see it all on CNN as a few months of ‘shock and awe’ unfold once again. I would like some comedian ‘embedded’ in with the army this time so that I can enjoy a touch of that comic relief that has become so much a part of um, the modern era of James Bond movies.

Frankly though, right now I have a lot more important and serious things to do than worry about what fallen empires want to charge around the place and do in their gerontion years.

A friend of a very close business associate of mine is right now getting Armin Van Buuren onto a huge soundstage in Johannesburg and he is waxing lyrical and clearly he is quite excited about being the promoter. Damn. I’d like to be over there at the moment but I have ‘things going on’ here right now myself.

Same attitude as Nero fiddling while Rome was burning? Maybe.

But I think I will stick to entertainment while television says things are serious. I’m ‘doing Canada’ at the moment...

Amr Hachicho - Canadian DJ.
Arab, yes, but not a terrorist.

Amr Hachicho (a kid from Qatar now working in Canada), is particularly catching my attention right now for the quality and consistency of his work. And I notice the stupendously brilliant Nigel Good is doing some stuff also for Canadian artists. His version of Myon & Shane 54 ft. Natalie Peris’ Outshine is staggeringly good material - if you like vapour trance.

Vapour trance?

It’s something originated by a famous scene envisaged by the American Steel Industry’s conceptual artist Syd Mead many years ago: in the future people imbibe vapours and listen to advanced digital music that enhances their personalities and brains.

Technology is moving very very fast. The tobacco companies produce their ‘e-cigarettes’ that deliver nicotine vapour, and the American bacon industry has an App that wakes you up with the sound and smell of sizzling bacon. What will they think of next.

The world of just a few years from now will once again be quite different to what we are all seeing around us at the present. I would try to be moving with the social cutting edge… Style, music, technology.

Actress in Cannes, in new Rolls Wraith.
Not a (Chinese) terrorist.

Me, personally, my biggest concern is why anyone would buy white leather for the insides of their Rolls Royce Wraith - how long will the stuff last looking new like you want it to?

St. Petersburg Hotel
Russian, yes, but no terrorists there either.

I saw someone on the Bear Chat boards recently talking about how the ‘rich have different rules to the rest.’ Not sure that they do, but there was someone in my ancestral history who ‘made an eternal covenant with the Goddess of War.’ And I too shall be playing by those rules. I’ll not be going to war. Not now, not any time soon, not any time, in fact. Hey, I like guns. I like to shoot at inanimate targets for fun. And I’m a really really good archer, as it happens.

But I’m not interested in doing wars.

Me, I’ll be partying and drinking and having a good time far far away from any war-front, that’s for sure. You can do very well, financially, when fools choose to go to a war. Not if they go, by the way; the war is already happening. It started a while ago, and like Hitler discovered, as he won his war every step of the way until his machine became exhausted, and broke down, everything looked good right up until the very end.

A Bear Confessing To A Profit

What really is a bear? As far as significant investing is concerned...? Today, numerous people suppose that it is anyone who takes a position in the expected downside movement of a market, including therefore traders who have small or leveraged positions through retail operations who are taking a position in expectations of a symmetrical reaction (in price) downwards in response to negative fundamentals.

Outside my first office in Howard Street
Perth Western Australia

In reality though, a bear is someone who knows the correct value of proportions or whole amounts of capital (assets).

In today's world, political interests that can have overriding influence over a number of market conditions and even over price itself, subvert the simple idea that price reflects naked real demand versus supply.

Aboveall a bear is good at analyzing the whole picture. One should not be constrained by highly artificial constructs – the listed equity price, the apparent interest rate, stated inflation, even GDP numbers. A thing, has some value in your estimation because it can be sold at a profit. Other than time, that is all there is to it. The fact that few others can see even what the thing is, never mind how little it costs, should be of no major concern to you.

Today, a real bear can see value where others are not merely not looking, but would discard as important or valuable possibilities even if they could 'see' it or them in the first place.

The only thing to be said for standard short positions is that some of them provide a commoditised version of a 'sale.' Many sales, in fact. Selling is crucial to fundamentals.

In other words, I would try not to make the mistake of thinking all the time that everything is already commoditised and available for open trading. Some things are still privately traded. Some things are despised by the investment geniuses of the modern world. And these are the things that escape the megalithic monolithic 'economic' vision of the broad marketplace reflected by the incessantly chattering, if not downright nagging, media.

The tools of modern day economic warfare are all computerised and online-capable. If we were living a hundred years ago those of us wishing to make profits from un-exploited potential might use metal drills and hydraulics and special screwdrivers and so on. But by today, all the 'un-exploited potential' of that past era has already been exploited. Trading one side of an already over-inflated or elevated trading range is not 'being a bear.'

Here is the key question: although we see a low circulation or velocity of cash inside the domestic economy, the question is not 'where is the money,' but rather, where is the value?' The value is 'analyzable' by one's own mind and vision, but it is accessed by the tools of today.

Kelly Brook's legs

Take a look at the image presented by your typical exploitational advertisement – granted this one, I think, is used in places like Turkey, and not in the over-sensitive contemporary USA – the girl is not cheap, and the car is not cheap either. The ordinary 'customer' can afford neither. But the spray can of AXE APOLLO is purchasable by the average person. All three elements are valuable in their own ways. And they all have a financial value too. Human principles place the girl at the top, human ideas about art place the car second, and human imagination includes the relatively inexpensive can of spray inside the realms of the first two. You know, it is always the cheap small thing, when multiplied across a large number of humans using it, that has the highest (real) total profit potential. And that is something worth bearing in mind, when you are being a bear.

You may have observed how, now that monetary velocity has drastically slowed, those with profits and cash are also quite reticent about showing their hands. Certainly there is the listed world of megalithic internet equities – no profits, questionable sales, massive internet 'reach' - and big claims as to capital value. These people do show their hands. But that kind of stuff is not for the bear or the professional investor at all. Rid yourself of the urge to participate in some imagined 'glow' about how to make a profit. And yes, there are always exceptions that stand out – Apple may be one of them in that it has real profits, real sales, a lot of cash, and maybe potential yet remaining to be mined. You might even feel a certain 'glow' if you acquired an equity share in Apple. But it is expensive. Like the girl and the car.

'The cheap small thing...' What is it? Well, Aldus Manutius, when he invented running script, was able thereby to give a tremendous advantage to the Venetian transcript writers. The advantage of speed was paid for by wealthy patrons of trade, rather than by an immediately commoditised consumer market.

The world in which we live today, is not very far different, to the day and age of Renaissance Venice. The traditional Empires of Europe presumed themselves to be unassailable, the religious beliefs and ideas about Nature were solidly held in the minds of the cogniscenti of the times, and the sun turned unequivocally, around the Earth, which was the centre of the Universe. And if Man should fly, God would have given him wings. How quickly these things all changed. How small were the things that caused the change – they were just ideas. A handful of neurons firing in a new way. Oh yes, of course the human is a wonderful, complex, massively valuable thing within the midst of great and networked complexity; but ideas are the key to it all, the thing that makes any of it work satisfactorily. And it is not necessarily costly to have good ones.

Social Wealth

Here's the interior of the latest Mercedes S Class. It has selectable colour mode lighting, hot stone massage seats (yep, really does), and ionised and essential oil-spiked filtered air.

New S-Class Merc martini bar on wheels

When you have a lot of money, much more than you would require to meet the basic necessities of life, then you have to think about frivolities such as the latest S Class. For me this will be like, next week or thereabouts, so I have to watch all the video ads Mercedes releases – and amazingly, they appear to show the Germans now have a strong sense of humour. One of the ads on Youtube, titled 'ordinary people's responses to the new S Class' has several women jumping in and out getting lifts here and there across Chicago heading to whatever nightclub back-alley entrance they want to go to, and making small talk about the niceties of the car along the way. V. droll.

It all starts out in the mind though, doesn't it? Wealth comes from inside your mind. Whether there are women around today who feel comfortable to go to any of the dozen or so 'world's best martini bars' alone, I do not exactly know, as I have not been to ALL twelve of these bars (or twelve hundred, really, since the appellation is open to a lot of dispute and is highly contested). But they should do. It is the mark of any sophisticated person, male or female, to be able to feel comfortable within themselves to do so.

Not my grandmother - but close!

My grandmother rode side-saddle, fenced, and could shoot pistols too. She went out to South Africa all on her own to teach when she was only a young woman; she was an independent-minded person. Daughter of a captain on the White Star Line, and at one point she was all-Highland dance champion for the Highland Sword Dance...

I suppose because we live in a day and age in which government policy has the direct capacity to wreck whole economies – internationally through reserve-building by third world countries benefitting through quantitative easing, and domestically because politicians are at the same time utterly mindless, fat-headed, lacking in imagination about ways to spark growth, and greedy about the amounts of all of our time they take up preaching nonsense – because of all of this the individual occasionally loses sight of the real way ahead.

Look, if the visible way ahead cannot be traversed in a new Mercedes S Class, then don't go that way. The way to wealth begins in any event surely within one's own mind – and there is no point utilising second-rate thoughts, ideas, principles, and teachings, to travel the pathways of the mind.

You have the choice as to whether you will use a Rolls Royce, a Bentley, a Mercedes, or even a brand new Corvette (a great car, by the way) to drive to the mansion of the professor residing within the gated estates of your own mind. Never jump quickly to conclusions, is the moral of that – and personally I am never daunted by the potential of a confronting truth around any corner either.

People around the place, presently, for instance, think there will never be another Crash.

But there will be. It will come from the imbalances of liquidity when external reserve building begins to really bite against the United States, which was the source of the QE bubble factory fake money demand. The demand was fake, but the money real. Macro economists understand that problems of politics and national management stem from disruptions of the smooth flow between the generation of liquidity from long term capital, versus the needs of the velocity of cash circulation in the shorter term balance sheets of trade. And good politicians further understand that the ultimate recipient of smooth flows, is the human person, and the social body of people on the national spectrum of political civil society. Yes, I am talking like George here. His theory is right enough. His associations these days are dubious, that's all, not his original ideas.

A real London Martini, is not for girls

People, are the key. Human people (this is a French idiomatic expression that puts the stress on the word 'human'). Miss that point now and you will miss the excitement of the next several years.

What Is Success Today

Effete is a word that should send shivers down the backs of everyone living and otherwise thriving in any dominant empire.

Human beings somehow seem to habitually squander favourable positions as much as they are famed for their ability to overcome adversity by struggling on.

Effete simply means exhausted through growing too much.

When you look at the current value of the Dow Jones Industrial Average index price, you see the point of the word 'effete.' On the one hand the price is high, on the other hand that price is not through any reason of corporate profitability. And it is especially not through any reason of circulation, or economic demand. The addiction the biggest banks have for Central Bank support is the mechanism for such boilerplate fictions about the performance of Wall Street, and the domination they wield over politicians who endlessly open the door to it.

But 'endlessly' simply means terminally. Not eternally. It means without restraint until the thing dies.

The thrill is gone

And so Wall Street today is an artefact.

The rain falls down. The skies become heavy and greyed-over seemingly permanently. Brows become knit and furrowed. People leave the streets. Everyone becomes 'serious.' Risk is always skewed in people's minds towards the adverse of outcomes. Reward is meagre. Effort is stinting.

'Leaders' are not only exhausted of any vision, but they are exhausting to watch and to listen to.

And so this is where we are...

There is a simply massive need for the thinking person to re-set the basis of capitalism into the context of the hyper-connected, device-oriented, modern world. There is no basis for it either in Wall Street or coming out of the heads of politicians or even out of any of the erstwhile business leaders.

A simple Crash – as in major stock market Crash – is almost too easy a thing to provide the phase of creative destruction that always occurs when societies reach the point of maximum exhaustion; if you assume an historically cyclical narrative.

There are yet many instances of greatness and great products still finding their way out into the world. Not everything is lost.

Arsene Wenger just won the FA Cup in London for an unprecedented fifth time – albeit nine years down the road from his last silverware at Wembley Stadium. He has interesting things to say about success:

Houses Divided

Of course it is always easy to 'just' criticize. But that's not actually what I want to to do here. I will make the distinction between just criticizing for the sake of it, and understanding tactical tools in the context of seeking eventual strategic advantage.

What is the advantage I am seeking?

Well personally I would like to see Putin and Yatsenyuk sit around at a dinner and mull over the relative superiorities of each other's favourite cuisines...

What James Bond would have with his vodka

That isn't going to happen. Not today or not even any time very soon. For one thing Putin is smiling for real these days and Yatsenyuk is scowling for real – those combinations of body language do not make for the best disposed of dinner guests or companions.

So what goes on behind the scenes? We all, I suppose, have some sentiment for the old James Bond franchise – but the glamour of the past days of Panavision and Technicolor are now replaced by predictable stunt chases and outrageous CGI effects, idiotic scripts, too skinny girls, and the dubious moral credibility of modern politics.

To some extent, the actual underlying principle of the thing – good v evil and the eventual victory of superior technology and skill and intelligence – has itself gone the way of big data and mindless drones (which have already been superceded btw) and the real knowledge held by all military leaders that an all-out armed contest, would have no one at all left on the battlefield.

When you play a game of football and go to the ground expecting the opposition team not to turn up, then you are in for a difficult time of things. The question for a businessperson is – can you make money when your side is losing, and ends up being on the losing end? You probably can, but you probably also need to prepare for this.

Team spirit is the energy of the team. I watched Munger and Gates and Buffett on CNN the other day same as many of you did. These guys have all lost the team spirit, lost the energy to win; they are in the mode of preservation of their own capital and position. And you can't win any kind of wars when leaders of capital act like that.

So fine, we're all on our own. But what if the game is now about who will be able to keep his or her own self-confidence high when all around are falling apart. If it's a question of keeping the 'team spirit' together in a team of one – one individual, or one family – then the eventual 'winning side' is going to consist of a small number of individuals who survived psychologically, as much as economically. And I think, in fact, with the stress on the 'psychologically!' Tell me the future, Solitaire...

 

Real Bond girl over there: