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Where To From Here?

An analysis of the good, the bad & the ugly
Wednesday, September 3, 2014, 1:02 AM

I know this super highway. This bright familiar sun. I guess that I'm the lucky one...

The financial markets were certainly correct in dismissing that rather abysmal first quarter 2014 GDP print, no?  After all, the current 4.2% GDP growth snapback revision in Q2 is proof positive Q1 was just a one-off fluke. Right?

The fact is: for a good five years now, economic pundits have been both hoping for, and then repeatedly disappointed by, the US economy's inability to achieve "escape velocity”.

From the 'misery loves company' department, the "good" news is that the other major global economies have experienced relatively worse economic outcomes than the US. So, in the land of global perceptual relatives, the US economy remains one of the lead sled dogs. 

But, until proven otherwise, we remain in a slow growth macro environment, as has been the exact character of this historically subdued growth cycle since its start coming out of the 2008 crisis.

Is it all bad, though? Of course not. There is some good along with the bad, yet there also exists some outright ugly. It's the balance, rhythm and interplay between The Good, The Bad and The Ugly over time that shape both the headline economic stats as well as theoretically support financial asset prices. Indeed, the manner in which this unprecedented global slow growth cycle has impacted global flows of capital has been much more responsible for raising the prices of financial assets prices than any actual economic realities.

So what lies ahead for the US economy? And for the financial markets? Are things going to get better or worse from here?

"The Good" (The Case For Optimism)

One of the true standout anomalies of the current recovery cycle has been that domestic small businesses have had a very tough time actually recovering (to say nothing of growing) in any meaningful manner. It’s not hard to understand why: their very large global corporate brethren have been able to partake in global stimulus, something not finding its way directly to the small business community.

Also, unlike their large corporate brethren, small businesses do not generally have direct access to the capital markets. In this cycle, large corporations have been treated to once-in-a-lifetime lows in the cost of debt capital. Historically, we've seen the economic and financial fortunes of large and small companies relatively joined at the hip. Not so in the current cycle. The reason this is very important is that at least historically, small businesses have been the key creator of jobs in the US. With the small business sector so left out of the party, it's no wonder we’ve had the slowest job recovery of any cycle of the last half century (at least).

A fingerprint characteristic of the current cycle has been that small business optimism has been living in what has been recessionary territory, historically.  Although it has only been in recent months, after five years of theoretical economic 'recovery', we've just witnessed a (small) breakout to the upside in small business optimism. Although this may not sound bright and cheery, we’re now back to the lows in optimism seen in prior economic cycles.  In all sincerity, this is a big improvement, and a good sign if it can be sustained.

Is small business optimism necessarily a Holy Grail indicator?  Absolutely not. It is anecdotal and, alone, will not drive an economic recovery cycle.  But in terms of where we find ourselves at present, it is welcomed improvement at the margin, even with its late cycle arrival:

The lower chart above importantly tells us sales expectations are and have been a big driver of headline optimism at the small business level (no big surprise). One thing to keep in mind as we move ahead is that like so many things in this special cycle of the moment, “emotions” generated by short term stock price trends have driven real world business actions and responses to optimism surveys such as this. 

The chart below shows us that from 2011 through mid-2012, the stock market followed the short term change in real small business optimism. But from mid-2012 onward, the direction of equity prices instead has driven business sentiment, once again highlighting the perceptual importance of equities in the current cycle. In one sense, the good news for the Fed is they have gotten when they wanted: economic reactions to short term stock price movements. Of course, this is also the bad news; as now stock prices need to hold and move higher, or we'll see potentially suffer adverse real economy reactions:

I have heard many analysts suggest small business has had a tough time as their access to credit has been limited in the current cycle. To be honest, that’s total B.S.

The fact is that there has been plenty of credit available for the small business community. The current cycle has seen the emergence and growth of business development corporations – non-bank entities, free of banking regulations, that make loans to small and mid-size businesses, crowding out the banks at the margin.  So small businesses no longer are totally reliant on banks for capital.

In each monthly small business survey, respondents list their top concerns. Not once has 'credit availability' hit number one over the entire cycle. Not once. The chart below is a look at how small businesses perceive their access to credit, alongside data for headline optimism, hiring plans and capital spending plans.

What's very striking in this trio of charts is that from the inception of the data in 2001 through 2010, all of the individual data points you see above have been joined at the hip with credit. Interestingly enough, over the past two to three years small business owners’ response to credit availability has been pushing toward the highs of the prior cycle. 

The big positive in the chart above can be found in the top clip – hiring plans.  Not only are we at a new high for the current cycle, we’re now back to the mid-range experience of the 2001-2007 expansion cycle. If small business is to have a positive impact on the real economy ahead, this is where it happens in job creation.  In all sincerity, the increase in small business optimism and increase in hiring plans we have seen in recent months is a big plus for the current cycle if it can be sustained and elevated from here.

Less positive are the lower two charts, which show that since 2012, headline optimism and capital spending plans have not followed along with credit availability expectations. Such is the macro of a slow growth economy.

Small business optimism and activity has been a key missing ingredient of the current cycle. So a critical question is: Have small businesses found their home at last in the current cycle?  Stay tuned.  Continued improvement in small business outcomes could easily carry the economy forward with some positive momentum. That is, if that momentum can outweigh the headwinds generated by The Bad and The Ugly.

Conclusion

In Part 2: The Bad & The Ugly, we analyze the increasingly concerning trends undermining the positive data above, most notably the fundamental lack of final demand -- the "elephant in the room" of this current economic cycle. Small business (and large business, for that matter) is not expanding robustly for the simple reason that consumption is not. The economy has not healed enough to support the growth seen in recoveries past. And certainly not to support these all-time high stock market prices.

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29 Comments

davefairtex's picture
davefairtex
Status: Diamond Member (Offline)
Joined: Sep 3 2008
Posts: 5464
lots of charts make me happy

Man, this Brian guy sure uses a lot of charts.  My hero!

I really appreciate and identify with the goal of linking the various time series together, as well as the thread of the storyline: small business (losers), large business (winners) of the whole 0% interest rate credit game.

I'll add something to Brian's story:  while overall bank credit has struggled mightily to regain 6% annual expansion, C&I (large business) bank credit is actually growing at around 12% right now while real estate credit has just now regained a 2.8% growth rate.  This bifurcation is more evidence of how big companies are using low rates to have a profitable post-crash experience while the rest of the nation (with no access to bond markets and no reason to go into debt) gets left behind.

The credit growth story is all about the debt bubble pop.  And without credit growth, back to normal isn't gonna happen.  Seems like watching small business credit growth is probably a good idea, because that's where the jobs will be created.  The jobs other than the part-time-WalMart-greeter ones, I mean.

It was neat to see evidence of the international capital flows along with the storyline I happen to like best:

... we are in the midst of one of the greatest movements of global capital seen in our lifetimes. The primary beneficiary of that movement up to this point has been the US and dollar-denominated markets. Chinese capital is escaping the crackdown on corruption, Japanese capital is escaping meaningful currency debasement, and finally European capital is escaping banking system confiscation (NIRP), taxes, and a softening Euro currency.

And as long as those flows remain, we can and should expect the US stock and bond markets to continue levitating.  Armstrong says much the same time - just about every time he writes anything.

Of course if something happens to interrupt said flows, it all will move in reverse.

Seems like USD is an important thing to watch, yes?

Jim H's picture
Jim H
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Posts: 2387
Corporate debt

Davefairtex said,

I'll add something to Brian's story:  while overall bank credit has struggled mightily to regain 6% annual expansion, C&I (large business) bank credit is actually growing at around 12% right now while real estate credit has just now regained a 2.8% growth rate.  This bifurcation is more evidence of how big companies are using low rates to have a profitable post-crash experience while the rest of the nation (with no access to bond markets and no reason to go into debt) gets left behind.

The inquisitive might ask, what is this debt being used for?  If you think that Corporations are investing in their futures via plant & equipment, new hires, etc., you would be wrong.. they are rather investing in short term EPS boost via stock buybacks, otherwise known as financial engineering;

In 2013 alone, corporations authorized $754.8 billion in stock buybacks while simultaneously borrowing $782.5 billion from credit markets. Jeffrey Kleintop, Chief Market Strategist for LPL Financial reports that corporations are now the single largest buying source for all U.S. stocks and the swift pace of buybacks has continued into this year with Standard and Poor’s 500 companies buying back approximately $160 billion in the first quarter.

link:  http://wallstreetonparade.com/2014/07/another-wall-street-inside-job-sto...

CHS wrote a post (totally lacking in hyperbole IMO) yesterday that referenced another estimate of the same;

Stocks’ Biggest Gains Are an Inside Job: Companies spent $598.1 billion on stock buybacks last year, according to Birinyi Associates in Westport, Conn. That was the second highest annual total in history, behind only 2007, Birinyi calculated. The pace picked up in the first quarter of 2014, when companies spent $188 billion, the highest quarterly amount since 2007.

http://www.oftwominds.com/blogsept14/corp-America9-14.html

All that debt with no future productivity tied to it... sad. 

butterflywoman's picture
butterflywoman
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Posts: 46
hmmm the consumer spending

hmmm

 

the consumer spending down.....

tons of printed money for big corporations...

the coming war has been in the works for quite some time

i don't think it has anything to do with charts.

 

 

LogansRun's picture
LogansRun
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Posts: 1444
butterflywoman
butterflywoman wrote:

hmmm

 

the consumer spending down.....

tons of printed money for big corporations...

the coming war has been in the works for quite some time

i don't think it has anything to do with charts.

 

 

Yes

davefairtex's picture
davefairtex
Status: Diamond Member (Offline)
Joined: Sep 3 2008
Posts: 5464
all that debt

All that debt with no future productivity tied to it... sad.

I think that's true regarding the vast majority of debt in the US.  Most of it is non-self-liquidating.  Home purchase debt, consumer debt, all the stock buyback debt, much of the sovereign debt.  Its all focused on consumption.  Perhaps some chunk of business and proprietor debt is actually related to productivity.

Appoint me ruler, and that's what I'd start with: all debt that isn't self-liquidating needs a massive down payment to it.  I'd be ruler for about 10 seconds before someone from Banking shot me.

Here's a chart on interest paid per area of the economy.  Data is annual.  Who is the big winner?  You tell me.  Some of the data surprised me.  I figured the nonfinancial corporations would have come out better than they actually did.

Source: BEA via FRED: Look up "monetary interest paid NIPA".

Arthur Robey's picture
Arthur Robey
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Unfashionable Dave.

I'd be ruler for about 10 seconds before someone from Banking shot me

So last century, Dave. I believe nail guns are in vogue now. And experiments with gravity.

Jim H's picture
Jim H
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Posts: 2387
Government debt servicing costs...

Nice chart.  What is truly amazing Dave is the yellow line.. thanks to ever decreasing interest rates, the cost of the ever growing debt has been relatively flat over 20+ years.  CHS, who has in my opinion been on fire recently.. says it best;

the core purpose of central banks' monetary policy is to enable vested interests to avoid desperately needed reforms in the real economy. This might have been blindingly obvious to others, but I finally caught on to the dismaying reality: the only purpose of central bank monetary policy is to keep the bloated, corrupt, inefficient and self-liquidating vested interests of the state-cartel crony capitalism from having to suffer the consequences of real reforms.

http://www.oftwominds.com/blogsept14/QE-reform9-14.html

JayPaul's picture
JayPaul
Status: Bronze Member (Offline)
Joined: Aug 28 2014
Posts: 30
up here...

tink, tink, tink, profits counted, margined, debt, greed, tink, silence... screams, no stopping the stomachs churn, fear, rage, as diaper stocks are bid. Why oh why would any half wit stay? It's "UGLY!". Accidents, diapers are bid.

RogerA's picture
RogerA
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Posts: 106
Probably Kennedy knew what he was talking about.

https://archive.org/details/New_Order_of_Barbarians_remaster_tapes_1to3

( http://www.nytimes.com/1989/06/16/obituaries/dr-richard-day-84-ex-pediat... )

The recollections of Dr Lawrence Dunegan of a lecture attended on March 20, 1969 at a meeting of the Pittsburgh Pediatric Society given by Dr Richard Day.

 

I remember him saying that automobiles would be imported from Japan on an equal footing with our own domestically produced automobiles, but the Japanese product would be better. Things would be made so they would break and fall apart -that is, in the United States- so that people would tend to prefer the imported variety and this would give a bit of a boost to foreign competitors. One example was Japanese. In 1969, Japanese automobiles -if they were sold here at all, I don't remember- but they certainly weren't very popular. But the idea was, you could get a little bit disgusted with your Ford, GM, or Chrysler product -or whatever- because little things like window handles would fall off more, and plastic parts would break which, had they been made of metal, would hold up. Your patriotism about buying American would soon give way to practicality that if you bought Japanese, German, or imported that it would last longer and you would be better off. Patriotism would go down the drain then.

 

A few more points:

 

  • People will have to get used to change . . .
  • Suppressing cancer cures as a means of population control.
  • Accelerate puberty to push evolution in the way they want.
  • Encouragement of drug abuse to create a jungle atmosphere.
  • Entertainment: violence, sex and more sex desensitization — preparing the people for "human casualties".
  • Food control (if you persist in illegal activities like growing your own food, then you're a criminal.)
  • Falsified scientific research.
  • Money and banking (There was discussion of money and banking. One statement was, "Inflation is infinite. You can put an infinite number of zeros after any number and put the decimals points wherever you want", as an indication that inflation is a TOOL of the controllers.
    Money would become predominately credit. It was already... money is primarily a credit thing, but exchange of money would be not cash or palpable things but electronic credit signal. People would carry money only in very small amounts for things like chewing gum and candy bars. Just pocket sorts of things. Any purchase of any significant amount would be done electronically. Earnings would be electronically entered into your account.
    It would be a single banking system. [It] may have the appearance of being more than one but ultimately and basically it would be one single banking system, so that when you got paid your pay would be entered for you into your account balance and then when you purchased anything at the point of purchase it would be deducted from your account balance and you would actually carry nothing with you.
    Also computer records can be kept on whatever it was you purchased so that if you were purchasing too much of any particular item and some official wanted to know what you were doing with your money they could go back and review your purchases and determine what you were buying.
    There was a statement that any purchase of significant size like an automobile, bicycle, a refrigerator, a radio or television or whatever might have some sort of identification on it so it could be traced, so that very quickly anything which was either given away or stolen – whatever – authorities would be able to establish who purchased it and when.
    Computers would allow this to happen. The ability to save would be greatly curtailed. People would just not be able to save any considerable degree of wealth. There was some statement of recognition that wealth represents power, and wealth in the hands of a lot of people is not good for the people in charge, so if you save too much you might be taxed. The more you save the higher rate of tax on your savings so your savings really could never get very far. And also if you began to show a pattern of saving too much, you might have your pay cut. We would say, "Well, you're saving instead of spending. You really don't need all that money."
    That basically the idea being to prevent people from accumulating any wealth which might have long range disruptive influence on the system. People would be encouraged to use credit to borrow, and then also be encouraged to renege on their debt, so they would destroy their own credit. The idea here is that, again, if you're too stupid to handle credit wisely, this gives the authorities the opportunity to come down hard on you once you've shot your credit)

 

.“There’s a plot in this country to enslave every man, woman and child. Before I leave this high and noble office, I intend to expose this plot.”

John F. Kennedy

 

 

Arthur Robey's picture
Arthur Robey
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Posts: 3936
Where to?

Why easy-straight up.

This is where you live. No expenses spared for your pleasure and gratification. Enjoy.

cmartenson's picture
cmartenson
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Posts: 5754
Galaxies and Neurons
Arthur Robey wrote:

Why easy-straight up.

This is where you live. No expenses spared for your pleasure and gratification. Enjoy.

Where to?  How about to the point where we realize the entire universe, everything that we can study from top to bottom is fractal and repeats across dimensions and scales that are impossible for my advanced (slightly) monkey brain to even partially grasp.

But I can grasp things enough to become curious and excited.

From your video we find this image of how the intricate network of galaxies are arranged.

Hmmm....that's interesting.  I used to stare at that exact image every day, but I wasn't an astronomer studying things  thousands of light years across.

No, I was growing neurons in culture and studying things best measured in microns (millionths of a meter).  

Here's a typical, florescently tagged culture of neurons for your amusement:

Notice any similarities?

I'm not sure what to make of it, but at the very least we might note that there's some principal(s) of organization that apply from bottom to top...or we might go further and note that the neurons are arranged as they are to facilitate communication and learning and then ponder the arrangement of galaxies in that context.

:)

Bankers Slave's picture
Bankers Slave
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Posts: 523
Onto something...

Peak Prosperity and beyond!

Rector's picture
Rector
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Posts: 509
Wow

I think you are onto something (the principles of organization that apply from top to bottom).  The evidence seems to suggest an order and a complexity that is remarkable.  What gets me is the thought that it all happened completely by chance and without any design.  It's amazing to me that two such systems evolve into increasing complex arrangements over time, rather than following the laws of entropy and breaking down into simpler forms.  Go figure. . .evolution and randomness are so remarkable.  Worthy of praise for sure.

Rector

Time2help's picture
Time2help
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Posts: 2840
Completely by Chance
Rector wrote:

What gets me is the thought that it all happened completely by chance and without any design.  It's amazing to me that two such systems evolve into increasing complex arrangements over time, rather than following the laws of entropy and breaking down into simpler forms.  Go figure. . .evolution and randomness are so remarkable.  Worthy of praise for sure.

Preface: I consider myself to be a creature of, and driven by, logic. I am not a religious person, frankly I think religion (at the macro scale) has been, and continues to be, used as a tool by TPTB to divide and control the masses. 

That being said, my intuition is telling me something else is going on here, deep in the background.  For lack of a better description, something spiritual.  I am starting to believe that there is much more going on than we know.

Time2help's picture
Time2help
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Posts: 2840
On another note, the singularity approaches

https://www.flickr.com/photos/expd/11641131465/

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SPAM_kaisgold
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Kais Gold

So nice and useful case study and information. Thanks for sharing this brilliant infographic. It is so much helpful for me. Thanks for!

[Admin:  Link removed.  Sorry, no unsolicited advertising allowed.  Try the front door next time.]

cmartenson's picture
cmartenson
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Emergence...
Rector wrote:

I think you are onto something (the principles of organization that apply from top to bottom).  The evidence seems to suggest an order and a complexity that is remarkable.  What gets me is the thought that it all happened completely by chance and without any design.  It's amazing to me that two such systems evolve into increasing complex arrangements over time, rather than following the laws of entropy and breaking down into simpler forms.  Go figure. . .evolution and randomness are so remarkable.  Worthy of praise for sure.

Rector

You know, a lot of complexity and fractal order can come from a startlingly few set of rules.  In the field of complexity theory this goes by the name 'emergent behaviors' and it's a fun area to explore.

In nature we might notice that combining hydrogen and oxygen in a 2:1 ratio we get this stuff called water.  Because of a few rules governing the angles of the bonds and weakly interacting Van Der Walls forces, we get this miraculous stuff called water which is a highly complex liquid that forms an infinite number of solid shapes when it freezes.  

Who could have predicted all the forms of snowflakes if they were given the initial starting 'rules?'  Nobody, because emergent behaviors arise from the initial conditions.  

If you want to have some fun there's a very, very simple 'experiment' you can run called The Game of Life which simply visualizes the sorts of patterns you get in a grid of individual squares after setting some very simple initial rules.  In this case, a square is either on or off depending on the state of its neighbors in the prior moment.  

You can toggle the buttons to try different initial seeds, and switch between rule sets and watch what happens.  

What you'll see is order and complexity far beyond what you might have predicted based on the simple rules running things.

In the natural world we've got a relatively wide variety of forces and rules to live by and I don't think we know them all yet (certainly not on the quantum level).  There's gravity and strong and weak nuclear forces, ionic and electromagnetic interactions, various levels of orbital shells, and so on and so forth.

In short, there are plenty of 'rules' to create a magnificently complex game that would appear to require a master planner of some sort, but it's the rules of the system that create both the order and the complexity.

 

jennifersam07's picture
jennifersam07
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Posts: 113
Lovely discussion

From Steely Dan to Musica Universalis. Thank you all.

LesPhelps's picture
LesPhelps
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Looking Up
cmartenson wrote:

Don't forget to point out that this is not an image of the universe, but an image of a virtual universe created in a computer model.  

Our model of the universe tells us we only see 5% of the mater and energy that must exist for our understanding to be right.  We call the unknown 95% dark matter and energy.  We haven't found it yet, but not for lack of trying. 

Perhaps our models are spot on.  Perhaps not.  It could be that a portion or all of the 95% dark plug factor is telling us to take a break from thinking and eat a banana.  

Who remembers a flat Earth and epi-circles?

Bringing it back to the solar system, here's an image of Comet Jacques I captured a couple of nights ago while doing video astronomy.

Sterling Cornaby's picture
Sterling Cornaby
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Posts: 152
I love the heavens

Great distraction!

I love the heavens (or universe).  It brings me peace in that they are so constant, so large, so magnificent and so unknowable even today.  I have been keeping close track of Jupiter for 4 years; I can point to her (his?) position in the sky day or night (as long as she is up there).  Right now (Sept 4 2014) she is just 'west' of the sun by about 2 hours... meaning Jupiter rises in the east about 2 hours before the sun and sets about two hours before the sun.  At noon Jupiter is in the position the sun will be at 2 pm. Here's a great application for following the night sky if your into such things http://neave.com/planetarium/ , I highly recommenced it (this 'toy' can eat hours of my time).  Knowing Jupiter's position in the sky often gives me great peace.  Jupiter will be in a predictable place in the sky today, 20 years from now and thousands of years from now.  There is so much I don't know on earth, but I can count on Jupiter.  I (and we humans) have no power over her.  I like that, especially given all the messiness here on earth.  Knowing just about Jupiter's position in the sky all the time also helps me understand our ancestors and their fascination with the heavens; which I believe is for much of the same reason; we can't touch them (no sin? incorruptible?) with our problems.

This is just one tidbit in my thinking.   

Also, on the discussion on neurons vs galaxy super cluster structure similarities reminds me of this quote: 'Things love to conceal their true nature' -- Heraclitus

We are trying so hard with our limited little money brains!

Sterling

 

Cornelius999's picture
Cornelius999
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Scientifically apparently, we

Scientifically apparently, we should not be here. But we are. 

"The stars incline, but they do not compel."  Possibilities often lie closer to home.  I'm going with the neurons

and the human brain ( not that you can really seperate it from the body ), and it being reputively the most complex thing in the known universe.  Again, it depends on who uses it.  And evidence has been around for millennia, but not too much:  mystics, thinkers, meditators, great religious leaders, martial arts adepts with transcendental abilities.  Evidence, of course, is what you want it to be, and want it for.

Anyhow, counter-intuitively, because of a lot of our reductive recent scientific culture, the current occupants of this planet may well be the greatest tribe of head- shrinkers yet to exist. And boy , are we shrinking the planet? And it must hurt.  I know my brain does!  And there sure are a lot of people with shrunken brains around.

Didn't  Goethe's Faust have something to say about a sorcer's apprentice who misunderstood and misused his powers?  Goethe himself discovered a new bone in the body.                                                                                                                                                       ....I'm thinking, no matter what the future brings, there'll be work for a clergyman....I'm beginning to like the power of the pulpit and the rant...

 

treebeard's picture
treebeard
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financial charts and other things

How deeply baked into the cake is the way we do business, how many different kind of strings do you have to pull to change something?  Is the money printing ethos built into they way we use pronouns in our culture, where the verb typically occurs in our sentences?  How deeply do we need to dig in to get beyond the symptoms of a problem down to the cause?

It is always the unexamined assumptions that get you in the end.  It is the thing that you worried about the least that becomes the biggest problem.  The whole concept of the three "E's" is a doorway into a much bigger and more interesting world. It will finally allow us to deal with the problem of unintended consequences, it is the bridge from individualistic, mechanistic, self destructive thought patterns to ecological or holistic thinking that will take us down a path towards healing.

Supper weeds are showing up in our industrial farm fields that are immune to our usual batches of herbicides.  Super bugs are showing up in our bodies that are immune to our usual batch of biocides (antibiotics).  What is the "mainstream" response, or what I would call pseudo scientific response to these problems?  Money printing, more toxicity. Someone with a lab coat and safety glasses shows up and throws a few Latin words around and we bow in worship.  The Latin mass is back in play at our new alter. The true scientific thought process has atrophied.  It is the pseudo science of death, materialism and its object of worship is personal power.  Yet when we see these things expressed (death) in the art and fashion of our culture we seem baffled.  The principal of the three E's is everywhere and in everything.  Call it fractals if you like.

True science, that follows the scientific process wherever it leads, is taking us in another direction.  It is telling us that the world is not a machine, but a conscious living being. Newtonian physics has been dead for half a century yet we still believe and act as if life as a machine. It is scientifically proven that our simple act of observation changes the world we observe, yet we are still dead to the world.  But it is not the world that is dead, it is us.  Bacteria "learn" form one another, those that live through antibiotic exposure pass that ability on to those that they meet. Antibiotic resistant genes reside in transmissible plasmids, facilitating their transfer. The rigidity of DNA and RNA that was supposed to make GMO 's safe for release into the world turned out to be false. The world is awake and evolving in response to our insanity.

C diff, the latest creation of our culture of death is a distortion of our internal ecosystems. What is the cure? Fecal transplants.  Yes our sh#t is going to save us.  Reintegrating livestock into agriculture, energy into economics, people into the environment, our hearts into our minds.  Our minds can only break things into smaller and smaller pieces (as useful as that may be), we need our hearts to put things back together again.  There is no unified field theory in the sense that we are pursuing it.  There is no one and done. There is no one size fits all.  The more the rational mind tries grasp and control the world, the more things slip through our fingers.  Mechanization freezes yesterdays understanding ad infinitum into solving tomorrows problems. It physically manifests the idea of the moment and holds it there for ever.  The idea of the machine that learns is the ugliest lie of all.  Cold evil, which is the process of limited awareness trying to do good but creates evil in its place.  It is the problem of the part trying to become the whole.

Financial charts are fine, but is seems they are always self referential within the already abstracted system.  They lack the intimacy that would allow them to speak the truth.  How about charts that related economic growth to the percent of copper in the ores mined, the biological health of our hay meadows, ecological diversity and health of our fisheries, energy per capita consumed per household, or parameters related to the health of people within what ever segment is being analyzed. 

Human beings are the only things that can evolve with the world around us.  It is that intimate awareness of those things around us the allow positive change to happen.  Consciousness heals.  Why else do we call love intimacy?  When we use our minds and our machines to keep things at arms length, everything falls apart.  In our culture we have the SVO (subject verb object) structure to our language.  We ourselves are primary, what we are doing is a close second, the thing  we are acting upon is a distant third.  In other cultures sentences are structured SOV, and the S (subject) is often omitted. The object stands at the front of the sentence. The other is embraced as the primary interest. Intimacy is built into the language. In that same culture children call their friends parents mom and dad, and a woman speaking to a friend about her husband will use the pronoun "our".  As the center of the world shifts from the Atlantic to Pacific, from a physically smaller body of water to a larger one will we move in the opposite direction emotionally? As things appear to be falling apart are we starting to heal at a deeper level?  Something is definitely afoot.

 

 

 

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Mark_BC
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Wow, such a great way this
Wow, such a great way this thread went. Treebeard, I could not have put it better myself. I come from a strong scientific background and as a result I was a pretty hard core atheist in my younger years since I equated the two. This was also out of revulsion towards so much of the blind dogmatism and evil that organized religions can exhibit. But as I grew up and explored the world more from my scientific perspective my world view changed.
 
The main turning point was when I stumbled upon, and could not rationalize away, the fact that there is not a shred of evidence that genetic evolution can occur given the types of random mutations we see, which would then be acted upon by natural selection in the traditional Darwinian fashion. I am not going to go into any detail, but if you have an understanding of genetics and populations you can try some math to see what the chances are of this happening... you're going to need a calculator with a lot of exponential capabilities, because you're looking at numbers like 10 raised to the 80 or something. Clearly there is more (or less?) going on than what mainstream likes to tell itself. Some people invoke religion to explain what cannot be understood, which is fine. I chose scientific doubt.
 
The second turning point came for me shortly afterwards when I figured out how the scientific method works, and I actually flipped science around. I finally figured science out -- it was not about discovering the truth (even though that is what many people believe it is used for). I think this is the main thought I'd like to leave the world with -- that science is very important, but it is being misinterpreted, or received the wrong way; totally opposite to what it should be used for. Many people, most I would say, understand science to be restrictive, to reduce the world down to simple truths, to mathematical formulas. But that is not how true science works. That is just how it is being used today. This approach is limiting, reductionist, boring, I would say even dangerous, and turns a lot of people away from science. It takes a whole rainbow of possibilities and kills it.
 
But rather than discovering the truth, science is actually about revealing what the truth ISN'T. This may sound like semantics but the difference is very profound. And it could be no other way, since we are not objective observers; we are part of the observed and therefore we do not have a reference frame from which to construct the "truth". Rather, we make the truth in our own brains and to varying degrees use our observations to shape that truth. But the truth exists only in our minds. This can be the only way that science can work -- it is fundamental to the scientific method of hypothesis generation, the null hypothesis, and theory creation. This latter approach to science, the one which interprets it to be actually revealing what the truth isn't, rather than being restrictive, is actually freeing and liberating. And it opens up a world of possibilities. All it does is guide you through the maze of possibilities that are not consistent with observable phenomena. By revealing what isn't the truth, science actually liberates you from inconsistent thoughts and understandings of the world. And far from being reductionist, I think any scientist would point out that with every questions science answers, it reveals more. In this sense I have seen a lot of similarity between science and the eastern religions like Buddhism.
 
As mentioned above, Newtonian physics has been dead for a century. Well it's not dead. Back in the day science would have said that "everything that does not conform to these mathematical Newtonian laws is not the truth, given our reference frame and the set of observable phenomena available to us at this time". Many people incorrectly interpreted it to say, "these mathematical Newtonian laws are the truth", which actually is not a scientific statement at all. But then along came our ability to gaze wider (relativity) and smaller (quantum physics) and we saw that actually there's a lot more going on than what Newton revealed. But he wasn't wrong, because given his reference frame as a non-objective observer in his time, what Newton postulated was completely consistent with the observable phenomena of that time. And a correct scientific statement of that time that, "everything that does not conform to these mathematical Newtonian laws is not the truth, given our reference frame and the set of observable phenomena available to us at this time" would have left the door wide open for the amazing mysteries of relativity and quantum physics yet to come.
 
But unfortunately, what's worse than the reductionist applications science is being contorted for these days in the western world is that economists try to emulate science with their charts and theories which they then force upon us. But they don't follow anything resembling the scientific method of hypothesis testing and rejection. Economics is about as far from science as you can get. It is simply codified politics. Yet it is being passed off as science. It is a very dangerous situation that I don't think will be possible to change before it's far too late, for reasons we are all familiar with here.
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Cornelius999
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Brilliant points Treebeard

Brilliant points Treebeard and Mark-BC.  Mark-BC, I'm salivating happily after your information that there isn't  evidence  traditional Darwinian evolution has occurred via random genetic mutations and natural selection, as commonly thought.  Can you suggest reading material, authorities? This is oxygen to my oxygen, and if true, astonishing!

Ahem, since we're ranging far and wide , can I also drop into the economic mix, the nugget of info that, Freud, I think, said  that the psychoanalytical equivalent for money was excrement, ie shit, which appropriately is what remains after our economic activities run their course. Did Freud also know, that the most trustworthy kind of shit, the healthiest kind, according to Chinese medicine, is golden coloured???

Maybe I'll stop here.

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If I were a divinity

And was struggling with the dilemma of free will and so forth, and was trying to figure out a way to convince the recalcitrant Human that they really did have many more abilities than they thought they did to heal the sick, transcend the few 'natural laws' they had figured out, harness energy for productive uses,  communicate with each other and with Me, then I would invent Science as a way to increase Humans' faith. I would be very frustrated at the uses to which they continue to put the gift of Science, however. And also frustrated that they kept worshipping Science itself instead of the Creator.

This was fun to watch.

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Cornelius999
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I can't help but also note

I can't help but also note also that in western cultures, the center of consciousness has moved from the heart, to the head. From the center of the body to one of it's extremes.  We are bifurcated, with sexuality at another extreme. In most cultures I am aware of, the center of consciousness was the heart, the center of the body, which kept us more balanced , sane, whole. 

Telling, people generally still gesticulate to their hearts when making emphatic points in conversation. Hardly ever to the head.

My bladder now wants into consciousness and is crying for release!  Gotta go.

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Chris Geo, consciencenes.

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Mark_BC
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Hi Cornelius, to be clear

Hi Cornelius, to be clear there is no doubt that evolution occurs and describes the progression of life on Earth, and that even natural selection occurs. I would metaphor this process to "Newtonian physics" -- very logical, obvious, and consistent with the available easily observable data. However, just as quantum physics reveals that Newtonian physics is simply a statistical average of bizarre things happening at the microscopic scale that are anything but logical and obvious, an analysis of genetics at the molecular level reveals something similar -- that beneficial changes could not possibly happen randomly and logically.

But just like Newtonian physics isn't "wrong" (it still describes most of the movements you see in your daily life with 100% precision), both approaches to evolution are correct, depending on the scale from which one observes them. The fallacy that atheists make is that they try to extend their logical view of the world into realms that are not logical and make grand proclamations about how the world works that are very narrow-minded and require a lot of sand to bury one's head in.

The book I read that exposed this to me was "Darwin's Black Box". He invokes Intelligent Design to explain how new genes appear. I don't since I am a monist, not a dualist, and to me there does not need to be "something else" required for anything to happen -- if we are all one and the same. The requirement for "something else" is simply how our brains are wired to function, to make sense of the world -- basically how we create narratives with objects that do things -- "cause and effect". But we create these objects in our own minds. I don't believe in the existence of some higher being; I believe in the non-existence of the "truth" which would have been created by a higher being; thus the need for a higher being disappears. We are God and God is Us.

This opens up a world of possibilities, like how you can think of someone instantly and then the phone rings and it's them, or how one friend traveling in Thailand can suddenly feel really down and depressed at the same time that his good friend is killed somewhere else, or any other spiritual occurrence. Science cannot refute any of that, although traditional science would scoff at it, but why? Because it can't be explained by any of the reductionist natural laws? But I have yet to see any reductionist natural law that attempts to explain how consciousness works! (and I predict none ever will since thoughts originate at the microscopic world where reductionist laws do not apply). This presents some limitations to what science will be able to understand. But at the same time, we are still completely at the mercy of the existing macroscopic reductionist natural laws -- Newtonian physics, relativity, thermodynamics, magnetism, etc etc. because those have never been observed to be violable. I can say with virtual 100% probability that we are never going to be able to violate the laws of thermodynamics (and thus we will soon be facing a Malthusian Collapse as fossil fuels run out unless something amazing happens and we can pull off a monumental transition to some renewable energy source). But there's a lot more to consciousness than those reductionist laws!

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Cornelius999
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Thanks Mark_BC.  I used to

Thanks Mark_BC.  I used to have Darwin's Black Box but had to jettison it during moving house.  Like you, I worried about him recruiting intelligent Design.  Thanks to some other helpful contributor I've got Dave Stove's " Darwinian Fairytales".  Stove accepts much of Darwin and has great fun with the other bits !

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