Year of The Dragon
25 Jan 2012
News:
Chinese soothsayer sees economic storms in 2012 (Financial Times)
The article starts: "On the first day of every lunar new year, scores of
minor government officials, businessmen and ordinary peasant farmers
congregate at a small Buddhist temple in the hills outside the eastern
Chinese city of Suzhou. They come to consult the master who lives at the
temple and who has made a name for himself as an unnervingly accurate
soothsayer... The guru predicts the Year of The Dragon will be good for
China and bad for the US & Europe..."
As it happens I don't think one needs to be a guru to predict the Year
of The Dragon will be good for China and bad for the West. The battle
between American and Chinese economic supremacy has been making
a lot of headlines recently, and people who trade financial markets
sometimes say that as soon as you notice everyone talking about a trend it's a bubble ready to burst- but, of course,
that advice
very much depends on the depth of the issue. Japan is a tenth the size
of China, yet the Japanese boom didn't pop until the the Tokyo Palace
was worth more than state of California. In 2012 economists are
predicting about 2% growth in the US and 1% growth in Europe if they are lucky, and something
around 8% or more in China. Chinese State Capitalism is winning
accolades, and Western politicians are frozen like rabbits in headlights
with no idea of how to reform their ultra populist chaotic and self
destructive socioeconomic model. Therefore the prediction that The Year
of The Dragon will be good for China and bad for the US & Europe is
probably the easiest prediction the Chinese soothsayer ever made!
Yet this brings me to a critical point, and the first meaningful point
in this article, namely what do you think is the difference between
the predictions wise philosophers and psychic soothsayers make? The
answer is that when you
talk to the wise man he convinces you, he tries to educate you about the
big evolving historical picture and show you why he believes what he
believes. When you talk to a psychic soothsayer he doesn't justify
himself, he
just hands you some unjustified opinions about future events. In fact, the Buddhist master may well be a wise
philosopher instead of a psychic soothsayer, but it's impossible to tell from the FT article because if he said
anything wise it went right over the head of the poor journalist, so the
article contains basically nothing but unjustified opinions.
What the difference between advanced people and normal people? An
ordinary man is constantly talking about things, in our tragic modern
society he's usually talking about cars or footballs matches or girls or
parties. These thoughts give him pleasure the way a man who eats food
takes pleasure in the feelings of food. An ordinary woman chatters away
about people, she is moved by the stories of what who did what to whom
etc. People who are more advanced talk about knowing, understanding,
right opinion and calculation. Unlike ordinary people they don't think
in the short term time frame, instead they are concerned with how to
create a better future. The explorer dreams of going places no-one has
gone before, the priest looks to change society, the entrepreneur to
change living standards. Because these people's minds are focused on the
future rather than the current moment, they are not lovers of pleasure
like ordinary people, but rather ascetic. The philosopher is a third
thing, he thinks about what is it that we all want to ultimately
achieve, what the purpose of creation is. You see the explorer, priest
and entrepreneur all have certain underling assumptions about what it is
that they want to create, and from these assumption they can focus on
the act of creation. So behind their calculations are the sort of
assumptions that ordinary people have about what pleasure is, in other
words the target their reason aims at is that which makes ordinary
people happy. The philosopher is the sort of glue which injects the true
goals of human life into the relationship between the ordinary people
and the advanced people. He questions the very nature of happiness
itself, and teaches the ordinary people and the advanced people what it
is that gives the soul pleasure, what it is they should both have in
common. [Plato's complicated Philebus dialogue talks a lot about this
idea]
For we philosophers the surface layer of actual physical events is dull
and uninteresting, what we are passionate about is, as Socrates would
say, the "why" not the "how" - and not just "why it
is going to happen", but "why we want it"! For example, if a child was to read my
2012 new year article, he
would summarize it by saying I predict that Apple will outperform Google and UK
government bonds will fall in 2012. If an adult was to read it he would
focus not on this "what", by rather on the "why it is going to happen",
but what I was really writing about is the "why we want it". After
reading the FT article I realised that perhaps I what I wrote is just
too far over people heads, and that's why I wanted to add this article
today to bring it more down to earth.
At the risk of labouring the point: Philosophers
talk about human nature, whereas psychics talk about human events.
Imagine the difference between understanding that you have a problem
with courage, which you can use to predict many events, compared to
going to a psychic who gives you just one of them. So if you go to see a
wise man for predictions about the future you come away with no
particular predictions, but rather with a lot of ideas about what's
wrong with you and how the challenges of life are going to help you
evolve; whereas with the psychic you come away with a lot of very
precise predictions about certain events, but no ideas about anything
else.
On this web site I talk about "paradigm change". Steve Jobs, for
example, described the conflict between the 'elite bozo politicians and
board members who make it up as they go along' vs the
'non emotional non political expert reasoned perfectionists' - what Steve
Jobs also lovingly called the 'shit heads vs gods' duality. For example
Steve Jobs said words to the effect of 'I don't do market research, I am
a perfectionist who builds for the gods', whereas the average CEO says
'I am in it for the money not truth and justice, and my company is run
by accountants and salesmen'. It's not just about corporate
management, in China they talk about emotive populism vs scientific
technocracy in government, like the Western debate between old fashioned
tiger schooling and modern unstructured undisciplined schooling the
debate is everywhere. Emotion vs reason, intuition vs
calculation, populism vs specialization, liberalism vs idealism,
postmodernism vs social conservatism, etc are some of the ways to describe the
paradigm change.
In my 2012 article I talk about how this great conflict seems to raging,
and about how we are stage which feels quite Samurai, a sort of fiery
high energy unbounded stage in which the intellectual leaders with
focused minds chop the muddle headed self indulgent bozos to shreds, and
how one can take this psychological theme and apply it to everything
from geopolitics to stock investment to the way you talk to your kids,
because the zeitgeist is everywhere.
For example, just as in 2012 Anglo-Saxon bozo capitalist ideology burns
down to the ground and expert state capitalist ideology flames up like a
phoenix, so in 2012 Google's unprofessional populism is hated, and
Apple's elitist perfectionism is loved. I called 2012 the year of "justice", the year self-discipline
triumphs over greed and other self indulgences. For example, 2012 would
be a good year to launch a new political party, see how Gingrich
suddenly triumphed when he finally found an anti-liberal anti-capitalist
message that is the opposite of Romney's traditional GOP party message.
But at the same time, because the paradigm change is still fresh
politicians should focus on what they stand against, not what they stand
for. That's the mistake people like Marie Le Pen and Geert Wilders are
making, they talk about leaving the Euro but everyone knows it's
populist non-sense, they should drop their tired old visions and talk
about new anti visions. For example, if you want to pick up the growing
anti-EU anger you say Greece needs to be punished, because that's got all the right energy without being
unworkable. In the same way, if you want to pick up the growing
anti-capitalism anger, you talk about nationalising the banks, you don't
try and sell state capitalism as a new vision because people's minds
just aren't ready for that yet.
The negative vision is pragmatism when it's non emotive, and the hunt of
evil when emotive. Let's take a random issue- say German energy and
examine it more carefully. People
stop buying the political marketing, they want to know if Solar really
works - that's pragmatism. People also get furious at the mindlessness
of politicians who squandered billions investing in Solar - that's the
emotional witch hunt side. Now that leaves one alternative, nuclear of
course. But what you don't try to do is sell that vision by persuading
everyone nuclear is good, that's "what is" politics and out of fashion.
Instead you say to voters "I am honest with you we have no alternative,
it's not that I love it, it's that I hate all the alternatives". Do you
see how that argument mixes pragmatism and hatred, creating direction
but without trying to lie to people with lots of PR tricks saying
Nuclear is good? That's Samurai "what in not" marketing, not the liar
marketing politicans are used to.
One of the big multi-year themes developing in the destruction of brand
value, go after the things which pretend to be better than what is
inside. Gerald Ratner once said "We also do cut-glass sherry decanters
complete with six glasses on a silver-plated tray that your butler can
serve you drinks on, all for £4.95. People ask me how we can sell it for
such a low price, I say, because it's total crap!" That kind of brutal
honesty is back in fashion again (although he should still have added
"but it looks the part!" at the end).
Tesco just reported poor earnings, but the point about companies like
Tesco and Carrefour is that they pretend to be middle class but their
interior design is revolting and despite being one zillion times larger
than your average butchers shop they actually have no choice. A Tesco
run by Steve Jobs would stock a few fresh ducks and turkeys even if they
didn't sell many, and it would have nice typography instead of special
offer signs everywhere, because that's what the gods would want. The
people who run Tesco don't seem to me to have a heart or soul, they are
seem to be accountants and marketing managers with no passion about
product. For spreadsheet bozos selling fresh duck makes no sense because
it doesn't add to the bottom line, all they care about is money, but
providing a service is bigger than making a profit on every single item.
These are the sort of guys who would charge for the toilets and the air
if they could, their life is about maximizing their revenue not
contributing to advancement of mankind. Science without idealism is sick
bozo science - and bozos are hated by the gods, and in the long run what
is hated by the gods fails. Right now Tesco is a plague on the UK
civilization, and people are beginning to feel it, and it will
consequently fail.
Tesco is run by numbers men with no heart, but there are also a lot
companies of companies that are run by pure gut feel - the media world
from newspapers to Hollywood studios. A lot of these companies have been
suffering over the last few years, bad reporting, unpopular films etc,
but it's about to get a lot worse. The psychological transition we are
undergoing puts them totally out of sync with the prevailing zeitgeist.
Let's take two examples from media - suppose you were running Bloomberg
what would you do? Professionalism is back in fashion, this would be a
great time for Bloomberg to launch a elite iPad newspaper. But what about existing
newspapers? If you trade stocks this is a great time to short Pearson
Plc, owner of the Financial Times, the Economist, and various other
media interests because they are steeped in out of date philosophy and
run by intuitive not reasoned people who are stuck and crashing. It's
almost impossible to imagine these guys turning round, from the top of
their head to the tip of their toes they are totally inspirational and
non professional, politicians and journalists and film directors are all
stuck in the same boat, they need to start again with a totally new
crowd of people. These are the people who are most of all the
non-professional clueless bozos Steve Jobs talked about, the people who
are at the epicentre of injustice and on the slippery slope to hell.
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