Saturday, January 21, 2017

This Needs Reading

I've updated this post, and it needs to be read.  So I link to it.

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Depends on What You Mean by Great

The reaction to Trump is largely narcissistic, either way a plea "but what about me?"  The USA economy is so based on freebies, to either left or right, that the focus is on what we can get instead of what we can earn.

Any human being has a limited capacity any given day to move, speak, think, consume, decide and so on, that is to say human action, which leads to given results.  The results are cumulative and can be either beneficial or deleterious.  There are people who want to keep things going the way they were. There are people who want change. Either way, it gets down to choice. Your choice.
U S A !  U S A !  U S A !
While the USA Ex Nihilo Credit regime, a regime with degenerate results, is dying off, and people clamor for more free stuff, the Chinese are busy taking their time to move, speak, think, consume, decide and so on, to build the Belt and Road economic zone.

This zone was last activated in the Early Tang Dynasty, which became China's Golden Age.  President Xi knows what he is doing.

You can be deliberate as well.  If you are in the San Francisco area,

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Friday, January 20, 2017

Trump Change

As the Donald is sworn in, the only real change is likely to be a curbing of the excess intel regime, a victory for the Total Information Awareness claque and a defeat of the cloak and dagger mischief makers.  With those expensive, murderous, pointless, counterproductive rogue elements liquidated, what is left is the economy.

Before the Soviet Union fell, Noam Chomsky wrote this:
When the world’s two great propaganda systems agree on some doctrine, it requires some intellectual effort to escape its shackles. One such doctrine is that the society created by Lenin and Trotsky and moulded further by Stalin and his successors has some relation to socialism in some meaningful or historically accurate sense of this concept. In fact, if there is a relation, it is the relation of contradiction.
If you watch Chomsky you'll note he is not about to be pinned down as to labels, but he is probably essentially an anarchist.  He certainly defends socialism, to the point he criticized the Soviet Union for failing at socialism, and his criticism was in the form of comparison to the USA.  Again, what I like about Marxists is they get their facts straight, and Chomsky sure gets his facts straight.
It is clear enough why both major propaganda systems insist upon this fantasy. Since its origins, the Soviet State has attempted to harness the energies of its own population and oppressed people elsewhere in the service of the men who took advantage of the popular ferment in Russia in 1917 to seize State power. One major ideological weapon employed to this end has been the claim that the State managers are leading their own society and the world towards the socialist ideal; an impossibility, as any socialist — surely any serious Marxist — should have understood at once (many did), and a lie of mammoth proportions as history has revealed since the earliest days of the Bolshevik regime. The taskmasters have attempted to gain legitimacy and support by exploiting the aura of socialist ideals and the respect that is rightly accorded them, to conceal their own ritual practice as they destroyed every vestige of socialism.
Now,  as Trump is inauGREATed, the above could be edited thus, so perfectly matched is the Soviet Union and the USA in hypocrisy and corruption of ideals:
It is clear enough why both major propaganda systems insist upon this fantasy. Since its origins, the American State has attempted to harness the energies of its own population and oppressed people elsewhere in the service of the men who took advantage of the popular ferment in America in 1776 to seize State power. One major ideological weapon employed to this end has been the claim that the State managers are leading their own society and the world towards the American ideal; an impossibility, as any free marketer — surely any serious liberal — should have understood at once (many did), and a lie of mammoth proportions as history has revealed since the earliest days of the American regime. The taskmasters have attempted to gain legitimacy and support by exploiting the aura of American ideals and the respect that is rightly accorded them, to conceal their own ritual practice as they destroyed every vestige of freedom.
In 1986 Chmosky noted the similarities.  Nothing is changing.  The real change coming is the continued disintegration and death is the ex nihilo credit regime. Who gets hurt and how at this point is mere aesthetics. It is what is is, the world can be a wicked place and that is good to know. You may pledge allegiance to all the hoopla, or you can get to work creating your own freedom.  No matter what happens in Washington or Wall Street you can innovate and create customers, that is create your own peace and prosperity.

If you'd prefer to build a business than debate politics, there are links to online courses on the upper right of this blog, and a list of my upcoming seminars here...

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My Supplier is Visiting!

On Jan 12, 2017, at 10:10 AM, JJ wrote:

Greetings ...
The company I do business with in China is coming into San Francisco to see me and would like your thoughts on how I should entertain them.  I know nothing of Chinese culture and I want to learn quick and be a good host. 
***First off keep in mind they want to experience USA culture, so no Chinese restaurants. You are their customer, so they love you no matter what.***

Should I pick them up at airport, show them around or merely set up a meeting?
*** Ask them if there is anything you can do to help make their visit a success.  Then they will name what they want.  You can subtly limit things by asking "when should we meet?"  When you know their plans, you can advise accordingly...  "Big Sur is beautiful this time of year, but the road just washed out... on the other hand, Carmel is worth the trip... ***

 Should I offer to pay the dinners and such?  My view is that we are truly business partners, when I succeed they succeed so in a since they are my most important piece of the puzzle and want to treat them as such. 
***Have they hosted you over there?  if so, you have a template:  any less and you are insulting, any more and you embarrass them.  And either way, you'd be modulating the relationship.  Think in terms of where you want the relationship to go?

In any event, say just that to them during meets "You are the most important piece in the puzzle..."

Also, never take them to your house (unless years from now you are truly friends) , that is too obliging...*** 
There are many ... companies in China but I have stuck with one company faithfully and want to continue to do so.  Any thoughts would be appreciated. 
***So figure a budget you intend to spend, and then when they signal their intentions, you spread that budget over the time alloted...

If they want a wine country experience,  depending on the balance, you can either put them on a bus at your expense, or arrange a booking at their expense... or escort them yourself...  all depends...

As to gifts, simple...  like UC Berkeley sweatshirts (the ones that just say "Cal" are good) so they can be cool back in China...

But remember, don't go much more than they go for you over there.... that's the rule of thumb.


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Thursday, January 19, 2017

REITS: How Cops Teachers Firefighter Pensions Get Robbed

The low hanging fruit to be plucked in a downturn is the pensions of the public service workers.  Here is how it goes.  First, this is paid article placement, in the Washington Post:

Maybe that’s why so many retirement plans—like those for teachers, firefighters, and more—use REITs as part of their investment strategy. In fact, you may be invested in REITs right now through your retirement plan and not even know it.
For America, REITs have helped revitalize both large and small downtowns and redeveloped old and new suburbs across the country, and helped foster innovation in communications, health care and more.

As I noted here, investment advisors flog reits to the public service workers.

Now, when all that ex nihilo credit is directed to build a pointless mall, such as this $190 million mall built in 2005 (last in, first out?) and the debt cannot be serviced, what happens?
The 1.1 million square foot mall, once valued at $190 million after being opened in 2005, sold at a foreclosure auction this morning for $100 (yes, not million...just $100).  According to CBS Pittsburgh, the mall was purchased by its lender, Wells Fargo, which credit bid it's $143 million loan balance, which was originated in 2006, to acquire the property.
So Wells Fargo, which has a license to create ex nihilo credit, did so to the tune of $143 mil way back when, and are still owed, under capitalism.  So they "bid" their $143 mil debt paper, plus another one hundred dollars, and won the auction.

Well, so what, now they have a money losing property on their hands. It appraised for 11 million last summer.  The mall itself is a waste. What did they win?

They own the leases on the 55% of the mall that is occupied.  Then there is this:
So it's probably safe to keep buying those mall REITs...afterall those 3% dividend yields are amazing alternatives to Treasuries and you're basically taking the same risk...assuming you overlook the billions of property-level debt that ranks senior to your equity position. 
They tap into the equity funneled into the projects by the REITS, and Wells Fargo has first call on that now.  Your pension moves over to the bank, you get ...well... nothing.

The hegemon is stage managing the economy until the fall of 2017, when the Trump regime is well-settled, and then comes the big crash, and with that the Donald has the team and time to manage the economic correction necessary for regime maintenance.

Who pays for the excesses of the ex nihilo credit regime?  Check your 401K to see how much you'll be charged.

Better start a business.

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Wednesday, January 18, 2017

Export Food Small Business Start-up

This is why, in addition to my general small business international trade start-up courses I teach a a specific class on food export.  The information offered everywhere except from me is not only bad, it is downright harmful.  The harm in these articles is people contemplating export expansion say "If that is what it takes, then I cannot do it." Well, what is described in the article is not what it takes. What is described in the article is a whole lotta waste.  The way it is done worldwide is not at all like this article describes.

Someone has to present what really happens in small business international trade.

This article is an example, and start out with a claim that is rather wrong.
While food giants such as P&G, Nestle and Unilever have long operated with a global footprint, it’s only recently that small- to mid-sized companies have been able to effectively tackle these markets.
Small businesses have been exporting food from the United States all along, nothing has changed in recent years, the tools tactics and attitude necessary have been there all along.  Yet the story will tell us about a "pioneer" in this field.
One of those food retail pioneers is Kontos Foods, a mid-sized New Jersey-based manufacturer and distributor of traditional artisan breads and Mediterranean specialty foods. A little over three years ago Kontos began a vigorous overseas expansion program, and now ships its products globally, to a wide range of locations, including Singapore, Indonesia, the Caribbean, Panama, Bahrain, Saudi Arabia, and Dubai.
I've never heard of Kontos Foods, and I am sure they are a fine company.  But what bothers me with these perennial articles telling us about "pioneers" is they never mention cost/benefit...  I can get sales into all of those countries pretty quick too...  at a cost.  The trick is to have sales and maintain a profit, at least as good as what you would have if you expanded domestically.  If Kontos is New Jersey based, then export orders ought to be no more difficult (or costly to acquire) and every bit as profitable as a domestic sale.  And alongside testing the overseas market, one would be obliged to test expanding domestically to compare with the overseas opportunities.

Now, recall the opening false claim that biggies like Nestle and Unilever were the only possible players before.  And who is making this claim?
Before Kontos, I worked at Unilever and my colleague, Kontos Foods’ Global Sales Director Doug Werts, is formerly of Nestle. Combined, we’ve lived and worked in different markets around the world, including the Netherlands, Brazil, and the U.K.
At Unilever, for instance, I spent significant time and resources building market share in Europe and South America. Those experiences, along with our current Kontos research about consumer shopping habits, provided us with the deep consumer insight we needed to target the right products and packaging to shoppers.
So to help a small or mid-sized company break into export markets, the process is the same as for Unilever and Nestle?  This is an internal contradiction: "nothing has changed, things are now different."

Now notice the valentine-to-self slipped in there, "my experience and my time spent on the Kontos dime travelling gives ME deep consumer insights."  Bull$#!+.  Since valid and reliable market information costs tens of millions, any other "experience or insight" is mere anecdote, and the plural of anecdote is not science.  There is a way to test market with spending tens of millions, and getting solid results.  It is search and learn, a process where you discover customers not otherwise discoverable.  But the tool tactic and attitude is utterly contrary to all of the elements this article proffers.  In short:

1. The tool - LCL MOQ FOB ...  if you have specialty, overseas buyers are looking to test this in their market.  They want and need that smallest order rational, not the largest order possible.  They want a pallet load to test, not a 40' container. It is FOB because you will be prepaid before anything rolls out of your warehouse destined for overseas.

2. The tactic:  Your export offer is one-size fits the entire world.  You ship overseas what you ship domestically. All "localization" for the export market is up to the importer overseas.  No good deed goes unpunished, so you never help your buyer by doing localization.  Recall we are talking a one pallet load shipment, and as a tst possibly several of these in sequence.  Why would you foot the cost of "localization" for a test order, in which most test will come up nil?  Don' worry, your importer overseas knows how to localize on the spot if necessary.  I am also an importer, and have had to "localize' many shipments on the spot in which customs has found fault.  it's a small shipment, no sweat.

3.  The attitude:  I came here to sell, why are you here?  At the trade shows, every buyer ought to place an order for your LCL MOQ FOB.  If not, why not?  If the person you are speaking to is not a buyer, end the conversation and move on to a buyer.  If the buyer says no to your one-size-fits-all worldwide offer, then find out why not.  Start a matrix of objections to see if any changes wold be worthwhile in your offer.  This is science, something sorely lacking among those who go to trade shows happy to settle for "trade leads."

What exporting gets down to is a test of the product by the importer overseas to whom you sell.  This article has a lot of moving parts, but bottom line is you find an importer overseas who wants to test your product.  On the one hand all of the rigamarole laid out in this article nets no advantage, and on the other hand you can achieve the same results with none of the rigamarole.

Then on this this:
The problem, however, is that overseas research isn’t cheap: Attending one trade show could cost upwards of $15,000-$20,000. There are nonprofit and government programs to help assist with companies as a means of trying to boost overseas trade. We found FoodExport NorthEast, a non-profit organization that supports international commerce. The organization is designed to help American food and beverage manufacturers attendforeign trade shows, connect with potential customers and learn about consumer trends.
Sigh. It could cost that much, but you can achieve the same results at a fraction of the cost.  Here is the funny thing, it could cost that much if you take the help those orgs offer, because their help is in the form of rebating half your costs if you do things their way, which "could cost upwards of $15 -20K..."

OK, so you spend $15,000 on a trade show and get $7500 back.  And their way is not the optimal way.  And I can do an optimal version the same thing all in for about $5000.   Now what kind of leverage is it when you net net you spent too much to do largely the wrong thing?

With the assistance of FoodExport, we started hitting the global trade-show circuit. They provide exploratory tours to help retailers discover whether a particular market is right for them. These tours offer crucial learning time, where retailers, manufacturers and distributors can quickly learn which regions are worth pursuing. When you’re on one of these tours, I recommend maximizing every minute of your research gathering.
For instance, while in Shanghai for a trade show tour, I learned that people in Northern China prefer bread much more so than their southern countrymen. This helped steer Kontos’ sales efforts to the correct part of the country, saving time and money.  
Any any Chinese food importer would already know this.  Why not just find a competent Chinese importer and have them test your product and provide feedback?  If and when something developes, then you might go visit China.  All this travel and time is expensive.
The international export business is on an upward trajectory. If you plan to join in on an overseas expansion program, gather an experienced team, do your homework and get your passport ready. People are now enjoying Kontos flatbread in Bahrain, Singapore, South Korea, Saudi Arabia and Dubai. Who would have dreamed that three years ago?
As I started out this post asking, where is the cost benefit, I am pretty sure Kontos has gone well into the hole getting those export orders.  The question is when, if ever, it will proven to have been profitable.  For overseas expansion, you need no more talent than a good Freight Forwarder and a solid importer, who may be discovered without ever leaving your office.

Because these articles claiming "small businesses can export just like Nestle now" have been coming out the last 40 years, I offer a corrective course.  No nonsense, the tool, tactic and attitude to find export business no more difficult and every bit as profitable, from the first sale and onward.  You may read about the course here, and enroll now and pay later at the same site.

Tuesday 1/24 - 2/14/2017   Four Sessions
Section One ~ 6 PM to 7 PM Pacific Time
(This would be 7 PM to 8 PM Mountain, 8 PM to 9 PM Central, 9 PM to 10 PM Eastern)

This work can be done either as a proprietor producing food, or an agent representing a food producer.

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Tuesday, January 17, 2017

President Trump, Build Up That Wall!

How can a free market anarchist call for Trump to build the wall?

Depends on the wall.

Now keep in mind the law, passed by democrats in 2006, requires the president to build that wall. So Trump is simply enforcing the law.

Again, depends on the wall.

To be politically correct, since walls are so Soviet-like (and we a soooo anti-communist) it is called the build the "fence " act...  of course the fence being a high tech surveillance full-employment act, with anyone crossing anywhere being picked up by sensors and then intercepted at Border Patrol's leisure.

But Trump campaigned on the politically incorrect "wall" meme.  This is good.

So what would the wall look like?  Well first, it should be about 20 miles wide, and 2000 miles long, covering the entire USA/Mexico border.

What's inside this 20 mile by 2000 mile wall?  Well, in essence, a 40,000 square mile free trade zone, Hong Kong like. No one owns the land, all real estate is on a 99 year lease system.   Anyone can enter this zone from Mexico freely, and anyone can enter from USA freely.  So this means anyone: tourists, medical patients,  refugees, asylum seekers, criminals, shoppers, vacationers and anyone else who can find an invitation to access anyone's property in this zone.  

Of course anyone leaving by land route would need to clear Mexican or USA Customs, respectively to get into those countries.  But otherwise the zone is free access.  All you need is a hotel reservation if you are staying overnight.

The optimum permanent population would be about 7 million people;  it needs an international airport, and a seaport at the point where the Rio Grande meets the Golfo de Mexico.

OK.. so where to start?  One mustn't just decide to have a free trade zone ala Hong Kong running for 2000 miles.  One needs to ease into this, people cannot handle freedom.  So start with a test pilot, and I have just the place:
 Though only 75 miles runs along the Mexican border, the reservation is about 2.8 million acres or roughly the size of Connecticut and has about 30,000 members. The tribe’s official website says that nine of its communities are located in Mexico and they are separated by the United States/Mexico border. “In fact, the U.S.-Mexico border has become an artificial barrier to the freedom of the Tohono O’odham,” the tribe claims. “On countless occasions, the U.S. Border Patrol has detained and deported members of the Tohono O’odham Nation who were simply traveling through their own traditional lands, practicing migratory traditions essential to their religion, economy and culture. Similarly, on many occasions U.S. Customs have prevented Tohono O’odham from transporting raw materials and goods essential for their spirituality, economy and traditional culture. Border officials are also reported to have confiscated cultural and religious items, such as feathers of common birds, pine leaves or sweet grass.”
But that is a drug transfer point!  Well, it is a drug transfer point not allowed by the hegemon, who controls the drug trade.  And otherwise, the Indians are only permitted to engage in vices, - gambling, cheap booze and cigarettes, fireworks.  Aside from that, the Indians have had their loaf of bread taken away and are invited to apply for a grant of crumbs.

But in a free trade zone, the Indians could be sponsoring the finest of everything in the world, by not having subsidies and monopolies.  The could be like the Scottish royals, have no property, but in charge.  They set the (anarchistic) rules, and they otherwise work at what they love alongside all other people in the territory. 

Once this has proven successful, the wall can be extended from the Pacific Ocean to the Golfo de Mexico.

Why not?  It's just a matter of honoring the treaties with the Indians.

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Monday, January 16, 2017

Happy Martin Luther King Day

There was a trial that found there was a conspiracy to murder Martin Luther King, and it took over 30 years to get that far.
After four weeks of testimony and over 70 witnesses in a civil trial in Memphis, Tennessee, twelve jurors reached a unanimous verdict on December 8, 1999 after about an hour of deliberations that Dr. Martin Luther King, Jr. was assassinated as a result of a conspiracy. In a press statement held the following day in Atlanta, Mrs. Coretta Scott King welcomed the verdict, saying , “There is abundant evidence of a major high level conspiracy in the assassination of my husband, Martin Luther King, Jr. And the civil court's unanimous verdict has validated our belief.
It is an interesting case with lots of interesting findings.  Such as the fact there were two active duty military units observing the assassination, an intel unit apparently filing it and a sniper team.

How come they were there? Neither liberals nor conservators when in power have ever inquired into this.  Well, because they want a fake MLKing to honor, not the real one.

The real one said the USA was the greatest purveyor of violence in the world.  A year to the day that he said that, he was dead.  An open court found it was a high level conspiracy.

I've blogged on this before...

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Sunday, January 15, 2017

Trump Victory: Cleaning the Stables

As I have said, the real problem is when Trump delivers no improvements.  A productive core in the USA got Obama elected, hoping for change from the warmongering Bailout Bushes.  They got burned by Obama. That same core that got Obama elected just elected Trump.  There will be trouble when yet again there is no change.

The hegemon does seem to be interested in reining in the intel world, an out-of-hand independent nation causes havoc to the Hegemon.  Just as the donors to the Cinton foundation, such as the people in the Norway government who donated a half billion to them for personal advantage, a whole lotta payback goin' on.

Here is an interesting example:
Mr Steele, who friends say fears for his safety, has gone into hiding while the veracity of the claims made in his dossier, and his own reputation, continue to be fiercely debated.
Forget the specifics of his story.  Although as a secret agent, he was unlikely to be much of a secret to the "enemy, " now that he has been officially outed, his network of contacts and beneficiaries worldwide are now in trouble.

Think about the lesson here, share info with the FBI or USA intel, and your life is in danger.

After 9-11 800 new "intelligence" agencies were created, along with the "full employment act" TSA. USA can afford neither, both in money and counterproductive results.  Before the necessary crackdown on USA, in USA, any possible rogue agencies must be eliminated.

We will all cheer this process of elimination, the collectivization of intel in USA.  Like he Ukrainians who cheered both the Soviet overthrow of the Tsar and the nazi overthrow of the Soviets.

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Saturday, January 14, 2017

India Currency Woes: Policy Laundering

Policy laundering is running a program through another country first, and then presenting it where otherwise it would have an ice cubes chance in hell of being adopted.  "Even India has gotten rid of cash, we should too." Here is an eye-opener regarding the hell India is going through with this experiment in cashless society.  Guess who is behind it?

Austrian economists are academics, so they debate along hypothetical lines, and work within the narratives to which they all ascribe.  Problems such as this arise, as noted in the article:
 No one and no state can secede, and no one can structure business deals apart from government without their having a ready currency at hand. Barter is out of the question. If a state attempted to secede, the federal government could squeeze them monetarily through sanctions and cutting them off from the payments system. There must be alternatives in place or that can be quickly expanded for any such independence movement to succeed.
In spite of being the best, by far, school of economics, their "apodictic" assumption of interest rates on loans forbids the obvious answer: credit is the universal currency, and it may be privately issued.  It is necessary and sufficient to a free market.  Add 100% reserve gold backed actual currency, something else government cannot or will not do, and who needs the hegemon?

There is nothing to keep anyone or any polity from seceding immediately at any time.  As they say, just do it.

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