Clear evidence of the end of the USD$ as dominant International Trading currency

This caught my attention recently …. an interesting read

http://www.sovereignman.com/finance/another-kick-in-the-groin-more-european-allies-join-china-led-bank-despite-us-frustration-16618/

After the UK announced that it will join the new China-led Asian Infrastructure Investment Bank (AIIB) as a founding member late last week, Germany, France and Italy decided yesterday to follow Britain’s lead and join as well….

This is part of an important transition from the old domination of the USD$ in Internal Trade, particularly in commodities, where up to now, the USD$ has been dominant. Recently there has been an increasing trend to trade commodities in the buyers or sellers currency – for instance in the case of transactions in the Chinese Yuan and the Russian Ruble.

These changes may well be detrimental to the United States in how it pays for overseas debt, that isn’t held in US Dollars. In that case it can no longer just print the necessary currency, it would have to buy the overseas currency at the prevailing exchange rate …. and with the liquidity of the United States already in question, with a estimated net solvency of approximately minus USD$60 trillion – the long term view is not positive, especially when the financial speculators start selling the USD aggressively.

The USA has no way of paying out its current deficit of in excess of USD$18 trillion dollars, accumulated by putting wars on credit card so to speak.  The United States, financially speaking is like a dead man walking …. I am not a financial specialist, but I cannot see a way out for them, unless they seriously cut their spending and increase income currently avoided through taxation loopholes. Surely if corporations are people then like the normal citizens of the USA, they should be taxed on the world wide income, regardless of the tax evasion strategies which they have in place.

A personal strategy would be not to leave funds in USD$ … to ruthlessly minimize your debt, and to put what funds you do have into “safe” (if there is such a thing) currencies, but preferably into hard assets like real estate or gold / silver, the actual metal not the paper equivalent. My personal strategy will be primarily real estate and keeping a minimum amount in liquid assets – and in setting up a simpler life style, whatever that means for you.

One thing that has had a marked effect on the value of the USD$ has been the confidence, Yes confidence that the world has in the currency, everything changes, that perception has changed in no small way due to the war that the American Republican party has been waging against President Obama, holding the USD economy as hostage … this in my view has been a major reason for the loss of face which has led to the loss of faith in this currency.

Good Luck .. just know everything changes and we are always in transition from what was, to what will be.

Stercoll Energy Service – an Oil buyer

We were recently approached by a company acting for Stercoll Energy Services Ltd …  (Stercoll details below)  … we agreed to issue the FCO once we received a categorical confirmation of the acceptance of the offer including the procedures for such .. below is their confirmation of their acceptance, received ..on the 20th of July 2012

++++++++++++++++++++++++++

Attn: Mr. David Sanders
Subj: D2 Gas Oil CIF Philippines

Status: Buyer, ready to proceed

Buyer has accepted all condition and oil specification offered by the seller, he is now ready to proceed. Please issue FCO a.s.a.p as per advised company and name of buyer via buyer’s designated information as stated below:_

Company Name: STERCOLL ENERGY SERVICE LTD.  INDONESIA
ATTENTION:        Mr. Datuk MYR UGUNG SIDYU
                            Director Asian Regional Head Quarters

Email:                  info@stercoll.com

++++++++++++++++++++++++++

The Buyers Website is :   www.stercoll.com

The Full Corporate offer was issued to this address on the 24th  of July 2012, it was valid for 5 days.

We were approached shortly after issuing the Full Corporate Offer from the Skype address, of chief.emeka kalu a person who said that they were the buyer for the main company Stercoll .. corporate details available on the above website.

Just before the end of the validity period this same contact sought to vary the procedures, despite receiving confirmation of their agreement to them as above.

We gave the buyer all help necessary within the procedures to move forward … the FCO expired on July 30th, 2012

No further contact was received from the buyer by way of explanation as to why they failed to proceed. This behavior is unprofessional and was unexpected, especially after they agreed to the whole offer including procedures before we would even consider issuing the offer.

For us this whole exercise was a waste of time … and an expensive one, as it meant that the oil was not available to other buyers during the preparation and validity period of the FCO.

The “buyer” proved to be a time waster … at the very least.

The end of business as usual …

Life is good for many of us, so that it’s hard to confront the change that is here, and with that the inevitable end of the quality of life that we see around us.

So it strikes me as obvious that the world is going down a road, in some ways where civilizations have gone before, but not for the same reasons, we are in fact going down a one way road, to the destruction of what is, that we have come to consider as normal.

The reasons are self evident, they come back to greed and the need for ever more growth, leveraged growth, more .. more …  all are unsustainable flawed strategies –  I ask you how can one achieve continual growth in a finite world … this insatiable need for more … we have been all living in a fantasy land, especially the Politicians, who are convinced as they focus on statistics and spin, that they are doing a great job when all around, their citizens are paying the price for their inability to have a real original thought – their incompetence, their lack of leadership, their focus only on re-election, their terror at the inevitability of change – drives them to makes nice little touches around the edge of policy whilst the heart of the country decays and we lumber forward, down the wrong path.

This insatiable greed of a few, has brought us beyond the brink of a global financial meltdown, we are in fact toppling over the edge into oblivion as we speak … whole countries and regions are already suffering in the Euro zone, but the whole world will be within the inevitability of what is to come … our mindless pursuit of the status quo .. has indebted the majority of those in the present to virtual serfdom whilst those in control … known colloquially as the 1% .. but who are in reality probably more like just 10,000 people around the word, are so afraid of change that they have convinced our Politicians (who are only driven by the need to be re-elected) that they need to maintain the status quo, this flawed and failed financial structure – which has little benefit to the majority 99+%, except more of the same. 

It is time we allowed the system to fail, we no longer have the ability to prop it up –  we have to stop, mortgaging future generation to pay for our mistakes or steal their birthright … our beautiful home, this spaceship called earth.

When I walk around cities, I see the crumbling structures, both in stone and in systems that are struggling to maintain what we once were, I see lots of papering over the cracks, whilst the infrastructure rusts and crumbles away in silence.

Within the decade we are in, what is hidden now, will become visible to all, in the first instance with the failure of the Euro$, where whole governments are desperately trying to hang on by their finger nails … they will fail … the inevitable collapse will spark a world wide financial meltdown that has never been witnessed in history. In the United States, cities and states are even now technically bankrupt … what will happen when the Euro zone of some other key point in the chain fails .. the banks will fail … there can be no bailout .. change will be here –  this global correction will affect everyone in every country, those who think they are immune are living in fantasy land – this new reality will inflict misery and unrelenting hardship on everyone.

It will not be fun … in fact I cannot see an upside in the short term … it may take a couple of decades perhaps a generation before we can get back on our knees … maybe as long as a 50 years to a century before we can stand up and face the future with any sort optimism … the only way we have any chance of a future, is by changing what we value.

The OWS … the Occupy movement is a symptom, and a necessary one …. in American the Constitution has been and is being continually being walk into the mud, whilst those in power seek to silence those who would say … we have a problem .. sadly, the world economy is past the ability to be healed … change is here Ladies and Gentlemen, hang on, because we are in for the ride of our lives, the destination, the abyss … some of us will come out the other side … but very few … for us to survive, and have the capacity to we will have to have the ability to think outside of the box and really work together without agendas, and realise that economies are not about numbers … they are about fully utilizing all of us, for the benefit of all of us ….

I have spoken of this before back in between 2008 and now … then it was a warning .. now it is too late … money will be irrelevant to our future … the accumulation of wealth for its own sake, is now past its use by date … when it happens, from then on, and in the short to medium term, the only thing that will matter is being able to be sustainable in food, in shelter and energy …

Good Luck …

Greece and the Euro Zone

It hardly matters why Greece is in the mess they are in … they just are …

What is the future … whatever the way forward it is serious stuff … every which way you turn there are serious consequences.

What is sure is that the current situation cannot continue …

If Greece stays in the Union, the future for the people of Greece is dire … already there is severe unrest … and unless a political solution is found the only way that this will be resolved is on the streets. From the information I have been able to glean the average person, especially those who are on fixed income and pensions are in severe financial straits .. with no likely hood of a positive outcome in the foreseeable future …

Why is the Euro Zone trying so hard to keep Greece in the Union, aside from the obvious far from small crack it shows in the community, there is a benefit to the manufacturing countries within the Euro Zone because of the perceived financial problems of countries such a Greece, Portugal, Spain, Ireland and even Italy … on the world markets this keeps the overall value of the Euro$ itself depressed ….

This has benefits for countries such a Germany, Italy and France with significant manufacturing sectors … by the virtue of Greece being part of the Union, the lower exchange rate works for these manufacturing countries …. as it makes their products competitive on the world stage …

If Greece and others leave the Union, aside from the financial meltdown that will affect Greece … it will strengthen the Euro and make their products more expensive … and less competitive … how do you think that this will affect those manufacturing countries  .. it will take them into a financial slowdown …

Really the future financial health of those manufacturing countries within the Euro zone … is in the hands of the Greek people ..

This is the reason I think that the Euro Zone wants to keep Greece in the Union …

Why is it that countries are beholding to the banks … all the assets of Greece will be sold off in a fire sale to placate the numbers me … what did the people of Greece do to deserve this …

Frankly I do not see the Greek people voting to stay within the Union …

Motion Picture / Content Production & Distribution – the next 5 years

My experience is in content production, distribution, Broadcasting and electronic Media.

Just doing some more research on the current “issue” or alleged issue of Piracy for the motion picture industry. The major players of which is primarily represented in the by the Trade Organisation the MPAA (Motion Picture Association of America, http://www.mpaa.org).

Now until recently I was aware of the issue, but not of the financial details, now after looking at the issue I am actually wondering if there even is a real issue, with the effect of the Global Economic Crisis being seemingly felt across every market segment imaginable, except the motion picture industry, which has according to their own figures had a 15% domestic increase and an International increase of 30% over the years between 2006 and 2010 … wow ! This despite the fact that the number of actual releases in theaters increased just 10.1%.

The price of the admission ticket, rose by 39.4% from 2001– 2010 and yet the cumulative cost of the CPI rose just 27.95% …. ?

OK all that aside …. the rise in the income 2008 –  2009 for theater sales can be expected, as if we go back to the depression, even in harsh economic times (because of the times in fact) the industry has been pretty much recession proof.  The major demographics for the audience goes from 12 to 39 year olds, it is a very niche audience which in these harsher than normal economic times seem to be the only ones that actually have any access to disposable income.

I could go on and on .. however the point is essentially this …. Yes there is a problem with Pirating ( a small one ), but it is not serious, how can it be when year on year the income from sales of theatrical releases has increased far in excess of the CPI … the figures for loss of income presented by the MPAA are not believable.

The following from the immediate past interim CEO, of the MPAA, Mr. Bob Pisano is basically unsubstantiated rhetoric, more commonly known as spin, how can there be a serious problem with over time the income to the industry has increased 30% … such statements as “We will continue to work with our industry partners to fight for common sense ways, through legislative, enforcement and legal avenues, to vigilantly protect the creativity at the heart of our industry from theft.” These kind of statements are making the industry look ridiculous.

I do not agree with piracy, however, this mis-information, is on going and has not been substantiated, they are beat ups by what is essential a trade organisation with a big voice – these statements are not showing the industry in its best light … there are many other industries that employ far more people and families in the USA and worldwide … that actually are in serious and dire straits .. because they don’t have access to the Hollywood Media their voice is lost.  Many families on main street, also have no disposable income to currently invest in any sort of recreation, except free to air TV and maybe cable … remember cable, content on demand and it new variances will be the ever increasing choice for the distribution of content to the wider market.

There are a few issues that the MPAA and the industry in general needs to address… urgently.

The price of tickets is not sustainable, bearing in mind that on top of these are the travel, parking, food etc .. taking your children is not the escape it used to be … I took my son to see Avatar at the local cinema and it cost one adult and one child over $40, not including parking, vehicle .. drinks etc…

The lack of growth is also a social one, and manifests as a result of the niche interests of the population, in their online lives – there will come a time, and it is not that far away where people will not go to the movies in anywhere near the same numbers, it is trending down in real terms and will continue to, for lots of reasons, some social, some concerning access, transport and financial to name just some, hopefully before then the studios will have come up with a way to reach people directly via Video Streaming in their lounge rooms, using the dreaded internet … this is here now – so change your business model or else basically … you have less than 5 years, probably less.  I wrote about the effects of technology on the film industry over 12 months ago, and it seems very much to be following the path and the time frame suggested then … in Australia with the NBN (National Broadband Network) this is supposedly designed to provide fibre access with data speeds from 100Mbps to 1 Gbps … this will have a major effect on  the access to On demand services including rich and video media content in Australia.

The Film industry, as with Television needs to start to make relevant stories – content that people will in the short term at least want to invest money in to go and see … perhaps the new business model is to make low budget movies that are truly an escape from the current meltdown and the huge pressures on families just to get by … but hopefully not too many more regurgitated sequels !!! – mind you that would not be too bad .. if they had a good story, as one can forgive just about anything if the writer and the Directors are at the top of their game –  unfortunately that is not the norm.

Also I have been saying this forever, content production is inseparable from content distribution and visa virsa  … you cannot have one without the other. if you have funds you need to have been or will be investing in infrastructure for program distribution – either in the historical bricks and mortar theatrical release or the new technology content distribution infrastructure, by Video on Demand, Bit torrent or similar technologies ..the future is not with the existing venues as now, if you don’t now make these strategic investments or at least strategic partnerships, the future is going to be a difficult place as you are going to be a poor position at the bargaining table when it comes time to negotiation in 3–6 years …. because then you will have no distribution infrastructure that you influence, control or own.

Note Change is the only constant, be flexible, be awake to the social & technologically driven  changes thaat are all around you, and respond to your market, your consumers – your consumers are not the distribution companies, or the theaters, your consumers are the people on main street … engage with them, find out what they want … if you do not listen to their feedback or even make a channel to listen (really listen) then I do not wan to be the one to say I told you so, while I cry over the carcass of the industry that help to inspire my imagination.

Future distribution will not be by a Bricks and Mortar Theatrical release, ultimately the distribution will be in the form of data perhaps via a Peer to Peer network such as a Bit Torrent data stream … think outside the box people .  Further the expansion of major releases will become a rarity, not the norm, and hopefully Hollywood will actually become a mature business instead of what it appears to be at the moment, an ego driven teenager with entitlement issues.

The uptake of new movies will have to have relevance to the actual market, talk to them, the real users, use the internet, that is its strength, where relationships and communities are the norm, not the exception .. also personally I am pretty tired of the predictability of the content coming out of Hollywood .. what about an original story please – also how about appealing to some level of standard and not the lowest common denominator.

To expand on the above via a personal observation, there are some unique and profoundly creative talents in the film industry, starting with unique writers that are true story tellers, their connection with the viewers illicit profound emotive responses, exceptional Directors with intuitive interpretation, timing and insight, fantastic Cinematographers, gifted actors and support staff … with so much raw talent to draw from why is it so hard to put it all into an exceptional film that does not necessarily follow the prescribed formula … but that creates a real connection, and is not just some faded copy of a something that was once a profound original work.

Mainstream mass media including film, is normally a passive experience (except in the case of that true creative work), this mass media model also includes Newspapers, Radio, Cable / Satellite and terrestrial TV …. there is normally little to no  interaction with the viewer, that is not where we are going, the future will trend …. in the longer term your content will need to illicit a emotive response, or if you cannot create a masterpiece then at the very least, interactive ….ultimately the technology and the data speeds will materialize to make this a reality … unfortunately, the current trends for content is that it will come out of virtual sets, and actors as we understand them now may be a thing of the past, computer generation will be much more prevalent than it is even now.

Concerning the future distribution model, basically the Telco’s that currently own the fibre, need content just as much a you will need their fibre for distribution, however I guess if there is no successful negotiation, between you, then I guess content of the ilk of “I love Lucy” and “A Wonderful life” will be the only content … for distribution … funny that.

I realise that if I was again actively involved with the industry, that is back in the club, after a while, perhaps as little as three years, this type of objective perspective would be nearly impossible for me to create, as unfortunately those in the industry have an total inability to be objective and relate to their viewers, their users .. they are too busy doing, but doing what actually ?

A revelation, perhaps even a epiphany will be come to light and be forced upon the industry sooner or later, as they clearly don’t get it … change is here, recognise it, or suffer the inevitable changes that will be forced upon you, which you won’t like so much – it’s like I say “Change is the only constant, how we experience it, is up to us” ….

Here  is the link to the MPAA Theatrical Report 2010 PDF ….

Telstra and the NBN

Research , tells us that the sale of Telecom Australia which was established in 1975 (to eventually become Telstra) had been an issue of public policy debate for well over a decade. It was talked about in the late 1980s and early 1990s as the Hawke Labor Government implemented a micro-economic reform agenda that included the privatisation of a number of Commonwealth assets including AUSSAT, the Commonwealth Bank, Australian Airlines, the Commonwealth airports, the Commonwealth Serum Laboratories (CSL) and Qantas. Labor generally opposed any sell-off of Telstra, but did consider the splitting of Telstra on a number of occasions

From the attached link here we can see that the Australian Senate has passed the legislation to split Telstra into a retail and wholesale (network assets) parts, Telstra, the monopolistic legacy provider of all Telecommunications infrastructure in Australia.

To me this whole situation is moot.

The Australian Government sold Telstra when it went private under a former Australian Government, and the government was paid for this assets and the remainder of this , though there is not that is left (approx 10%) is owned by the  Future Fund a government entity which was established in 2006, basically to meet the long term commitments of Public sector Superannuation payments…. see here.

My point is that we are using some of the same money that went into the coffers which we ere paid when Telstra went Private to exchange the Privately owned monopoly that was Telstra for another monopoly which is the National Broadband Network … the only difference being that this one is a government monopoly.

In a few years when the Government has spent tens of billions of our dollars on the NBN and its implementation, they will probably privatise it. Then essentially we will be back where we are now, with a Private enterprise monopoly –  funny does anyone else see something here that looks like Telstra, feels like Telstra and smells like Telstra  –  ah… then its Telstra by another name.

Surely it would have been cheaper just to buy back Telstra, just wait a while, until its shares lose more value they will be giving them away with your breakfast cereal.

Or perhaps they didn’t want the aggravation of trying to institute the massive structural and cultural changes that would be necessary for Telstra to change from the former monopolistic anachronism into a relevant, sustainable, transparent, accountable customer focused organisation, in short into a viable business model … Wow !! No wonder they are going for an alternative, actually I agree, it seems to be an almost impossible task.

For this to actually happen would perhaps require the board of Telstra instituting (and paying for) the changes, they would have to care and give a dam, a necessarily focused team would have to be imposed on Telstra –  independent of the operational structure, and finally the will and commitment to spend many billions of dollars over perhaps 7– 10+ years.  Then if successful, Telstra might have a possibility of resurrecting a worthwhile business model … this is part of what I do …. I am so aware of the enormity of the task. However there is no choice, Telstra has to be rebuilt from a organisational, structural and most important a cultural point of view, otherwise it will be as relevant to the future of communications technology as is the current manufacturer of buggy whips. Personally I see much of Telstra’s problem is a lack of a coherent vision, including the active involvement of all stakeholders, until this happens Telstra will not be relevant and competitive – long term.

Such transformations are possible, I once had hopes that the culture of the ANZ Bank which I considered such a success story, however my previous article about Green-washing here – has shown me, that the changes appear to be only skin deep, the culture has not appeared to change as I had hoped… greed is still greed – a sustainable accountable culture does not seem to have taken … very sad.

Well back to the article, I foresee a long term career here, as after working on Telstra for about 10 years a few short years later (or even sooner) we would have to do it all over again, to refocus and change the culture of the NBN after it goes back to private ownership …. so I could move from Telstra to the NBN … to institute similar organisational and culture changes …. then I could retire and write about the experience … but what an experience it would be.

Does anyone else see a cycle here…. ?  The real problem is that these decisions are not driven by anything other than incompetence, short term strategy, expedience, and ego –  after all,  they are politicians.  Could it be that the Labor Party is trying to correct the fact that Telstra was privatised in the first place ?

Essentially the problem is that nobody learns from the past, they always think this time it will be different …. without a underlying commitment to an ethical and sustainable culture as the basis for the paradigm, our egos, will screw it up … do you think it is possible for us to put aside our egos and actually work together  … pretty please ?

Limits to Growth

Why are we here? And how did we get here… I think you will find that is the question that people should be asking now, and will be asking more and more over the coming years.

Let us look at history just for a while, something which we almost never do, there have been Oh so many instances which we can point to where we as a species, did not learn from the past, and there are two culprits for this beside arrogance and all of the platitudes, like “it can’t happen to me”, “Think positive”, “it will all work out” … this position we are in for one reason, the resources of the planet are finite, the call and demand for those resources by the ever increasing population is causing the very scarcity of the resources to finally be brought into focus… the old scarcity principle is well and truly alive, the trouble is this time it really is real.

Why are we surprised with this… since the Club of Rome was formed in 1968 and with their first major publication in 1972 was The Limits to Growth – the Club of Rome, seems to have as its charter .. “to act as a global catalyst for change through the identification and analysis of the crucial problems facing humanity and the communication of such problems to the most important public and private decision makers as well as to the general public.”

The original report, examines fives variables which are: world population, industrialization, pollution, food production and resource depletion.

An update to the original report came out after 20 years, and another after 30 years (published in 2004). Another is expected in the short term, the 40 year report.

In 2008 Graham Turner at the Commonwealth Scientific and Industrial Research Organisation (CSIRO) in Australia published a paper called “A Comparison of `The Limits to Growth` with Thirty Years of Reality”. It examined the past thirty years of reality with the predictions made in 1972 and found that changes in industrial production, food production and pollution are all in line with the book’s predictions of economic and societal collapse in the 21st century.

There is huge controversy about some of the claims made in the books, however in essence it sheds light on a simple fact, that resources are finite and are therefore limited. This is so important when we look at non-sustainable energy resources such as Petroleum based products (that currently underlies our entire way of living), rather than using sustainable resources for all our product needs. This of course gets me to another issue, we need an alternative to petroleum products, not to convert basically many food based crops, such as corn etc, as a base for maintaining the status quo and further polluting the atmosphere, we need dramatic research into a sustainable ways to produce hydrogen, as well as any other form of sustainable ways to produce, portable and peak load electrical energy (the somewhat mythical cold fusion comes to mind), some positive early work in many areas is already evident – much more emphasis on this work needs to be shown.

If we cannot find a sustainable energy source, what do u think will happen to the civilisation as we know it.. as one of the biggest problems with a global market, is how do you ship products from one point to another when there are no oil products to power the ships, road transport, farming machinery and of course airlines. It seems on the outside looking in , countries should be looking to provide incentives to their local industries to at least make them self sustaining in the essentials of life, food, clean water, and shelter – and being communal animals.. a community.

Any thoughts…?