Pro Commerce

Radio Shack

When I read that Radio Shack had remodelled 39 stores, I had to go see what they had done.

Eight of the remodels are in the San Jose Bay Area.  Radio Shack has 5,200 nationwide and 2,000 outside the U.S. and Canada.

Here is a company that is nearly 80 years old that has gone from ham radios to home stereo to portable computers to cell phones and survived.

By Spring of this year there was little evidence that Radio Shack could survive. A week ago the share price had dropped below $.70 from a high four years ago of $24. The ratings agency listed it as 'near bankruptcy'.

Thanks to sheer good luck, a week ago Friday, I went to see the remodel.  The remodel is aimed at the fifteen year old ‘makers’ market of people who love robots and 3D printers. I have followed the 'makers' since they became visible in my circles in San Francisco in the early 1990's.

The remodelled stores hit the market exactly and the  eight local stores are in the global center of the ‘makers’ world that is becoming global.

It remains to be seen if ‘makers’ buy everything online.  If they pick up an occasional necessary part that they need in a hurry at Radio Shack the business will have found a new market.

Over the weekend I bought this ‘penny stock’ and the order executed on Monday morning.  I wasn’t the only one who saw the stock, RSH, as a wild flier.  On Monday a couple of million shares traded. By Thursday the daily trading was 50 million shares and my stock had more than doubled.

Absurd luck.  And funny to me.

Jenin and my advice

This is a weird tale of my advice first biting me in the ass and then becoming useful.

The story begins in the mid-90s when I began advising both the Japanese government and the Israeli government to break through the global Japanese and Jew hatred that is built into the media bias. I suggested that both countries develop a proprietary relationship with a major global newspaper or two and give them exclusive stories.  The relationship should help when urgent honest reporting is necessary.

At the time I believed that the New York Times was a newspaper with enough prestige that it would embarrass the other media sufficiently to get the accurate story through to the public.

The first time that Israel got to test this theory was in April 2002. The Israeli Defense forces attacked an ancient town called Jenin as part of a response to the Second Intifada. Jenin had an intricate ancient town structure making it very dangerous for the Israeli forces. One solution would have been to bomb the town and destroy the fifty Palestinian terrorists who were hiding there along with the civilian population.

The Israelis, as is their moral wont, decided to attack on foot, door to door, with the known risk of death to the Israeli soldiers. Instead of losing one or two men, Israel in its willingness to protect Palestinian civilians instead lost 23 young Israeli soldiers.

Here is the story as reported in Wikipedia.

"On April 7, senior Palestinian official Saeb Erekat suggested to CNN that some 500 Palestinians had been killed in the camp. Five days later, when the fighting stopped, PA Secretary Ahmed Abdel Rahman told UPI that the number was in the thousands, hinting, along with other Palestinian figures, that Israel had snatched bodies, buried Palestinians in mass graves and under the rubble of ruined buildings, and otherwise conducted on a scale compatible with genocide."

Stories of hundreds of civilians being killed in their homes as they were demolished spread throughout international media.[7] Subsequent investigations found no evidence to substantiate claims of a massacre, and official totals from Palestinian and Israeli sources confirmed between 52 and 54 Palestinians, mostly gunmen, and 23 IDF soldiers as having been killed in the fighting."

Israel had videotapes and audiotapes from a UN observatory near the Jenin camp. These showed the reality of UN cooperation with the terrorists as well as the meticulous Israeli protection of civilian lives.

The New York Times was given the exclusive access to the footage.

The New York Times did not use any of it. It went with the Jew hate story.

I was aware of the traditional Jew hate at the New York Times but was stunned at their behavior in this historic instance.  I couldn’t believe the malicious behavior of the NYTimes.

It has been 12 years since that idea of mine turned out so badly.

Now the Israelis (and the Japanese as well) have learned to use the Wall Street Journal which doesn't hate them. In the most recent Gaza war Israel broke the story to the Wall Street Journal that president Obama had stopped the supply of important missiles to Israel in the middle of battle.

This story of Obama White House treachery and underlying Jew hate was published by the Wall Street Journal and dramatically changed the tone of the global reporting on Gaza.

My idea that first bit me in the ass, finally redeemed me.

Getting around pharma control

A month ago I wrote a blog bemoaning the horrible fate of a miracle cure, Sovaldi, that cures hep C but costs $100,000 for a course of treatment. The media, insurance companies and Medicare are screaming to try and force the developer, Gilead, to lower the price.

I explained my outrage and my concern that cures for many diseases that my children and grandchildren will experience will not be developed because of this Obama care byproduct: The hysterical Lefty demand to control market prices can destroy research and innovation.

My son has pointed out to me that this may not be the case. Rich people in Canada come to the United States for medical treatment. Medical tourism is growing at geometric rates as some people cross the Mexican border for expensive dental care while others go to Thailand for cosmetic surgery. Americans already travel to the Cleveland Clinic for heart issues, the Mayo Clinic for diagnosis and many other places that are not covered by their insurance.

There is even a town in Japan (Koriyama City) that has invested heavily in a hospital and adjacent hotels for people who want proton cancer therapy, a highly successful and expensive tumor treatment. There are clearly enough people willing to travel. The trivial cost of an airline ticket is added to their cost of medical treatment. Enough people want to survive.

With this prospect, I begin to understand that pharmaceutical companies will continue to invest in new medical cures and treatments. The market may no longer be concentrated in the United States and may be distributed around the world, but at this point in history there is enough money globally to justify the research investments.

I passed the critical shopping point

Yes, there is a critical point at which you first think of buying something you need on the Internet before you think of looking for it at a retail outlet.

I passed that point a few weeks ago and I was surprised.

Whatever the object I was thinking about, I realized immediately that it would be outside the top five selling products in this line. Therefore it would not be worth looking at retail stores. I live in San Francisco, not in a suburb where there are large sprawling stores. San Francisco stores maximize their floor space by limiting the number of objects per product line.

This critical inflection point, where the first thought about a needed product is the Internet, may come later in life for a person in a suburb. It may come earlier in life for someone with a chaotic full-time 60 hour work week where nearly everything is bought online and much food is brought to the front door, still hot.

From a business point of view the trend lines that show the American population moving to the Internet as its first thought, will play a significant role in the design of our cities and our lives.

Having reached this inflection point, the first thing I noticed is that the local Best Buy stores have a large counter near the entrance for people to pick up their online purchases.

I now feel a new level of freedom. It is a positive feeling to know that virtually any object product or service I can imagine is potentially in my hands and I don't need to go look in a brick-and-mortar brightly lighted aisle.

This is not to say that many people, and occasionally for me, it can be fun to wander around and look at merchandise. It is now a matter that merchandise-wandering has become a luxury that is independent of my purchasing practices.

What is anti-commerce?

If I am pro-commerce then what is everyone else?

They are mixtures of anti-commerce. I will elucidate so you can see.

Let's take the biggest category: environmentalists. Most of our environment has been cleaned up over the past forty years.  More than a third of the United States is already preserved parkland.

At this point further environmental policies, especially those based on the belief in the CO2 Armageddon, are designed to harm commerce. The perfect example is suppression of fracking. Natural gas is the cleanest energy readily available and an important source for economic growth. Complaints about water supplies and waste are minor and remedial. Anti-fracking is pure anti-commerce.

The second biggest category is pro-union.  Pro union includes political measures such as keeping non-unionized stores out of a local area.

Unions abhor meritocracy. Meritocracy is the lifeblood of commerce. Some people are good at commerce some people are good at specific productive functions. Rating everybody on seniority means low productivity and life for everyone in the boring Luddite world.

For anti-commerce, let's throw in people who think big business is a priori bad. Businesses grow because they sell more to customers and to more customers. Sometimes they grow in order to combat government regulations that become expensive for small and medium-size firms. To grow in the first place they need customers. You don't like big companies you're not in favor of people buying what they want, you are anti-commerce.

The same is true for many issues like free trade. Free trade agreements are synonymous with pro commerce. You want restrictions on prices you are anti-commerce. You want to increase government regulations and government intrusion in people's lives you are anti-commerce.

I think you get the idea. Any particular detail may be more complex but the gist of it is always that encouraging people to make use of their unique human talents and helping other people do the same, is pro commerce.  Everything else is anti-commerce.

Hippies and hi-tech

The map on the right shows the high-tech geography of the United States for a recent period.

To me it is a map of the hippie distribution in the United States (I travelled to many hippy business events).

There is a connection between hippie values and the development of high-tech. The first high-tech in the 80s and 90s was computer related. Since then it has been Internet related and has moved from the San Francisco Peninsula to San Francisco.

What were the hippie values that generated high-tech?

* Hippies were intent on building a new society. They were offended by the hypocrisy of the existing society and singled out the establishment's hostility to pot as an example. An anti-pot position was inherent hypocrisy for people who drank booze every day.

It was the hippie intent on building a new society and concomitant acceptance of innovation that is the hippie foundation for high-tech. (Yes, hippies also tried the Luddite direction too.)

* Hippies had a disdain for established institutions including the police and social hierarchy. High-tech is conditional on rejecting the narrow controls and restraints of earlier technologies. Barefoot-food-nut, Steve Jobs and Steve Wozniak were hippies who saw the computer being used for industrial purposes but not for fun and experimentation.  They saw better uses.

* Hippies were adamant about not having a boss and not taking the established world seriously. This led them to create co-ops that introduce new foods and vegetarian tastes. It also encouraged new business explorations in retail and manufacturing. The hippies brought about the largest small business boom in American history. Multiple small businesses also generate technical innovation.

Technical innovation owes a great deal to the hippie milieu.

Rape

My blog is not just about commerce it is also about statistics and social process. I produced a public radio program for nearly a decade on the subject of social thought. I interviewed and recorded many hundreds of leading thinkers on the subject.

What always catches my eye in the social realm is when politicians, the media and large groups of people start focusing on an issue that seems to contradict existing data.

Have you noticed legislation and academic hysteria focused on rape on college campuses?

In my realm of data and statistics, every effort has been made to devise new questionnaires and new methodologies for measuring rape occurrence in the population. There is great feminist disappointment with existing numbers collected by the government.

I have begun wondering what this fuss is all about.

The first observation I must make is that college campuses are now 60% female. A major change in a 35 year period. From formerly dominant male campuses to female dominant. Whatever college men are doing, there are more women to complain about it. Or there are more women who have sex while drunk and then call it ‘rape’.

The most astounding fact about rape on college campuses, or anywhere else, is that rape has declined dramatically over the past two decades.  In 1994 four out of a thousand women reported to survey researchers that they had been a rape or sexual assault victim. By 2010 these numbers are down to roughly 1 woman per thousand making that claim. Roughly a decline of 75%. Astronomic decline by any standard.

This decline parallels the decline in national crime rates. Today an almost equal number of women report that there was an attempted rape as claim a completed rape.  The number of attempted rapes reported to survey researchers, one per thousand, never changed over two decades.

To get an understanding of how common rape is in our society, what one per thousand means, you can compare it to death rates. For every woman who reports a completed rape there are two women who died of a heart attack or cancer in the same year. And there is roughly 1 woman who died in an accident for every woman raped or sexually assaulted.

Rape has always been a problem related to age. There is almost zero probability that a woman over 35 will be raped. This suggests that, like crime in general, rape is an age related activity largely driven by males.  It declined when fewer males were born to women who didn’t want to be mothers and declined further when the ones born were put in prison. (The two reasons for the big decline in general crime rates.)

Back to the question of why, at a time when rape  of women has declined dramatically has preventing rape on campus become a public, academic and political issue?

My answer would be, number one: single women are a vitally important Democrat-Union Party political voting group and rape is a concern to them.

A second, and a lesser reason, is that there is a tendency among ‘women’ as a class to take advantage of their new found political and academic power to use the threat of rape  persecution as a source of leverage over males. A fresh source of ‘power’ for women.

The reality I see in our society is that women remain second-class citizens because they do not demand first-class status. Therefore they exercise their ‘second-class’ power by claiming the right to punish any man with the charge of rape.

Yes I am a male. Yes I know that many women will accuse me of some horrible social transgression for writing this blog. Fortunately I am too old for the Fulminating Furies to threaten my income or livelihood.

Smarter movies and TV Characters

Something happened that has shaped my view of movies and TV. On the insistent advice of many people I started watching Breaking Bad a TV series available on Netflix. I found it to be of such extraordinary quality that I re-watched it. On the second viewing I saw many details overlooked in the first viewing.

I rank Breaking Bad somewhere with the greatest pieces of literature. I have only re-read a few books including Herman Melville, Mark Twain and Nathaniel Hawthorne. Of course I have seen and read many Shakespearean plays repeatedly. I only recall seeing one movie a second time.  

Breaking Bad has made me hypercritical of movies and TV. I now avoid movies unless they come close to Breaking Bad in providing character development, complex narrative and a storyline that is driven by consequences rather than deux a machina.

There are still a number of movies that I can go to and a number of TV shows that I can watch. For TV it is now common to have intelligent people as lead characters. This is particularly true in ‘police procedurals’ where a laboratory person or computer person is portrayed as intelligent and their intelligence drives the narrative.

The whole point of this blog is to call your attention to the fact that for every intelligent character in 1980s TV or movies there are a dozen today.

That is appropriate for a society where high-tech is the world of glamour and digital competence is increasingly respected.

Grand schemes, Marx, Freud and Religion

When I was growing up there were three major grand schemes that explained the entire world.

I first explored the Marxist model, and thanks to George Orwell's Animal Farm and a few months on a kibbutz I realized it was inappropriate for real human beings. Just an ideological superstructure for people who needed a universal explanation.

I next explored the world of Sigmund Freud. It was a wonderful explanatory model for most of the world and included an historical explanation of Moses. I even spent a few sessions with a Freudian shrink. Freudianism had some inherent failures because it didn't have a simple process like ‘revolution’ to bring it to fruition. It required decades of self-examination which rapidly appeared to me to be navelgazing rather than learning.

I also spent time discussing the theology of the Catholic Church in its most elegant form as taught by the Jesuits.  The problems with an external world as a source of rewards and punishments to maintain the tentpole of a living world created dissonance for me.

I could have looked at Social Darwinism or many of the lesser universal structures. Fortunately I was finished with this search for universalism by the time I was 23.

From that point on I have had a strong resistance to any form of universal human understanding. In fact I gravitated toward the anthropological view of culture which finds a wide variety of different mutually independent human social structures. I gravitated to commerce which has no universal theory and no theory whatsoever.

For a person with intellectual yearnings, such as myself, the only answer seems to be a vast accumulation of experiences and a willingness to live with horrific ambiguity. That is the definition of commerce as an organizing conception.

Return of hereditary elite

In an earlier blog I discussed Thomas Piketty’s projections of a long-term division in our economic system with the growth of an even more powerful hereditary elite. I pointed out that this is not likely to be true for America which eliminated its hereditary elite in 1960.

I have been asked by my readers and friends whether it is possible for an hereditary elite to return in the United States.

I see four reasons that will keep it from happening.

* First and foremost, Americans have begun to take meritocracy for granted. We abhor nepotism.

I see no potential for a rejection of meritocracy by Americans. Americans who travel abroad, in a few cases, recognize the hereditary elite in the other parts of the world.  When they return to America they return with a new appreciation for our society.

* Second, the traditional institutions that helped maintain an hereditary elite, and still exist in most of the world, cannot be rebuilt in the United States. The educational system, no matter how elite oriented, still requires merit for a school to be considered prestigious. Private clubs are gone except for sham imitation clubs,  Americans simply cannot feel comfortable with someone else simply because they are rich or they are the child of a rich person.  ‘Exclusive’ is just a brand concept or a phony pose.

* Third. The institutions that were vital to getting rid of the incompetent child and rewarding the most competent, for a century, depended on sending the children to the colonies to sort out the most competent ones. The colonies are gone.

Money doesn't buy anything exclusive in our society. Or put another way, money does buy a private jet or mountain home, or a time with a politician or an island but it really doesn’t buy prestige or respect.   

Everybody has children whose competence is genetically determined to be the average of the population. It is possible to pass on political skills to an average child but it is very difficult to pass on business competence necessary for maintaining the family wealth.

* Fourth, along the same lines.  Wealth is subject to many erosions including drugs, fast cars, social climbing women, and con artists. Also mental illness.

I don't see much chance that America's monetary elite will be able to reestablish itself as an hereditary class. The idea that someone is part of an ‘elite class’ for reasons of heredity, is too farcical to be credible in America.

TED and Richard Saul Wurman

I interviewed Richard Saul Wurman a few years after he started TED. Because TED is so important there is no need to explain what it is.

Richard Saul Wurman is a designer and has lived his life in the design world. He even did the trivial job of signage in the San Francisco airport parking structure.

It is to Wurman that we owe a great debt of gratitude.

Wurman created TED and in its initial iteration it had a limited audience in a physical space in Monterey. As its popularity and importance grew the program was expanded to other rooms with the use of television and finally to other venues. Then to the world.

What has always been maintained was the genius that Wurman built in at the outset. TED talks are short, 10 to 15 min. long and heavy on graphics.

The shortness comes from the basic conception of the design world. ‘Most of the world can be understood in very simple sequential signals’. That applies to lectures, ideas and concepts.

I'm not sure why that happens to fit so perfectly with our world of Internet, Facebook and texting. But it does.

Richard Saul Wurman with his view of the world, a world potentially clearer and more understandable when it is explicated with graphics and simple language has opened up whole worlds of knowledge and understanding to all of us.  Worlds that had previously been covered by verbosity and pomposity in the status relationships between the mentor and the students.

Rabbis should be more helpful

This is the time when we should be hearing from rabbis.

The Jewish people are under an assault, everywhere that Christianty and Islam have found a home, which is of historic proportions. Elie Wiesel says there will not be Jews in Europe in the future.

I live in the United States and I can feel the Jew hate among Lefties and environmentalists. This is not going away. America has, for 50 years, been the safest home for Jews, in the entire history of our people.

There are two rabbis who are exemplars of the public intellectual. One is Shmuley Boteach and the other is Daniel Lapin.

Both are doing a good job of explaining the moral leadership of Israel on the issue of self-defense. But where are the thousands of other rabbis who need to step up to the plate at a time of extraordinary danger and speak both to the Jewish people and to the evil ones around us (including many fellow rabbis) who are complacent or antagonistic when our lives are threatened by Islam and the nuclear armed Mullah of Iran.

Historically the rabbinic world was created with the destruction of the Second Temple and the dispersion of the people of Israel. It was an invention, unique in the history of the world, to allow a people to have an ongoing dialogue, education and community.

The creation of Israel necessitates that that rabbinic world take on a different function.

* First the rabbinate should show a dramatic support  for Israel around the world and reject people who hate Jews and still call themselves rabbis.

* Second the rabbinate should help interpret the role of Israel to the world.  The source of modernity, improved health, moral leadership and vitality.

* Third it should speak to the issues of Jewish tradition that are relevant to the understanding of Jews in the modern world. Explain why we play such an extraordinary  role in the creation of modernity. Explain why we do so much good with so little appreciation. Explain why modernity and commerce and Jewish tradition are so  intimately and integrally related.

 If the rabbinate is to survive the creation of a new Jewish homeland it needs to take a constructive role.

Europe looking back on 1914

I have often joked that Europeans are rather sad because the highlight of European society was 1914.

Unfortunately, my observation is tragically accurate as Europe grows to hate Jews more with the addition of their new Islamic citizens.

Europe in 1914 was on a straight trajectory toward more and better art, music, theater, technology and cultural vitality. Europeans were happy, integrated and productive. Jews were in the mainstream of Northern European society.

That came to an abrupt end and Europe has never recovered.

Europe became a group of nations filled with mutual hate and recriminations, failed governments, and a people with no future after WWII. Because they had no future they gave themselves governments that did nothing innovative and redistributed the commercial and national assets to the State. The hereditary elite of the society was held responsible for the 20 year interwar disaster but nothing was done to effectively interrupt the hereditary mechanism. Europe has remained a class-based society with a strong anti-commerce bias.

Today's Europe is not nearly as bad as it might be if America weren’t available to provide it with radical improvements in healthcare and medicine and the perpetual stimulus of new technology and innovation that American corporations deliver to the world, Europe included. What little that is positive in Europe, the deadend European's owe to America and Israel. 

Homeless and poor definition

It would be rude for me to tell my intelligent readers that when the wrong word is connected to a real world attribute that the consequent understanding and policies will be wrong.

If you think that a bee sting should be considered the same as a flu shot then you will not get protection from the flu come next winter. A bee sting and a flu shot are not the same.

The particular example I used in an earlier blog was what led me to fight GMO after hearing academics confuse genetic food engineering with plant breeding.  I knew that we had serious potential policy errors on the horizon.

The example I most importantly want to focus on here is homelessness. The term ‘homeless’ came from New York and migrated around the country in 1981. The term is applied to a large population of street people and people who were formerly hobos. Street people tend to be a cluster of humans who are uncomfortable living in homes, do not want to fit into the society with all of its puritanical requirements and includes a population who enjoy the use of drugs and alcohol. A few of them are mentally ill.

Included in the term homeless are the traditional hobos who do not want to settle down and who do not, under any circumstances, want to become part of the society.

As a consequence we have the incredibly stupid policy of providing residential housing for this large population of street people and hobos who do not use it. Since 1981, in San Francisco, where we have a population count, the number of people on the street has remained the same.  For 30+ years.

The problem is the improper use of an English word. The so-called homeless are not in need of homes.

Sex in the city

I would like to make a contribution to our understanding of a political phenomenon: single women voting for Obama.

The following three paragraphs summarize the data on single women voting. To these paragraphs we need to add that single women voted 67% for Obama in 2012.

The unmarried women of the 2012 make up almost 40% of the African American population, nearly 30% of the Latino population, and about a third of all young voters, or 32.7%, according to the research released on Thursday. They are divorced, separated, widowed, or have never married.

"They had an enormous influence on Tuesday's election," Gardner said.

Single women have traditionally been Democratic voters, largely for economic reasons. They tend to have less money than married women – because they don't have a husband's earnings to fall back on. They also tend to be less educated.

I would like to add to the understanding of this single women voter phenomenon by repeating a popular male adage: ‘when men get married they expect their wife to look like she does for the rest of her life; when women get married they expect to change the man into the person they want him to be’.

I call this the Sex in the City syndrome. After the TV show which is based on the permanent illusion that men will somehow become what women want them to be.

It is my contention that this concept is the backbone of single female thinking.  It constitutes a major reason why single women would vote for a Democrat, particularly the Obama type Democratic who promises that human beings can be changed. Democrats generally believe human beings can be improved by government action and policy.

It is my contention that marriage is an effective antidote to this single woman’s backbone worldview.

Consequently, I see no change on the horizon unless single women lose faith in the Democrats to do what they promise.

Filipino appreciation

I did something in 1971-72 that has had repercussions in American business.  I have recently received my second appreciation (Blog on the first.)

When I left the Bank of California as a vice president, I told top management that I would bring a legal case against the bank on the issue of its inadequate hiring of minorities and women. It took six months for me to find a lawyer who would handle the case, and then the lawyer demanded that I find minorities, a black and a woman who had legal standing to sue the bank. I did.

The suit resulted in negotiations by the lawyer, Robert Gnaizda from the firm Public Advocates, that became the most advanced and extensive employment discrimination settlement in American history. This is why you still see more minorities and women in banking than in any other American industry.

More than a decade ago, I was appreciated with a standing ovation by thousands in a black church (Allen Temple Baptist of Oakland) when the minister described what I had done.

Last week I received a standing ovation from more than 20 young Filipinos who were told about this historic event. At the same time I learned from Mr. Gnaizda that the reason for the prompt settlement was that the Federal judge hearing the case had authorized the class-action to include all minorities and women in California who might have applied for a job at this bank in the previous 10 years. The largest class-action ever created.

I am particularly grateful to the Filipino audience, who are staff and friends at one of my current clients. I think very highly of the Filipino American community that I know and work with. They are industrious, they contribute immensely to American society; they are bright, hard-working students and as an American population, they are uniquely wonderful people.

 

Tofu history

I am interested in the way that a new product goes from inception to mass-market.

Probably the most interesting case I know of is tofu. Tofu is fermented soybeans in a delicious edible form.

I don't know the origins of tofu. I know the tofu I loved to eat from the early ‘70s when I first visited Japan. Much of what Japan eats came from some earlier invention in China. Tofu could be one of them.

I do remember a 1971 disagreement with Stewart Brand about a $50 million 1965 grant by the US government to turn soybeans into an edible popular food. The crap that came out of the grant was a canned tasteless mess. The grantees should've hired an anthropologist to check on soybeans around the world, instead of nutritionists.

In the mid-1970s I met Bill Shurtleff and his partner Aoyagi Akiko. They had just written a book on how to make tofu and how to use it in recipes. I gave them business advice on how to promote their book. Basically traveling around the United States to hippie grocery stores doing demonstrations and giving out samples.

I was also an advisor to a Briarpatch member, one of the earliest hippy tofu manufacturing plants in Marin County, Wildwood. Tofu manufacturing plants, which are usually local, sprung up all over the United States as hippies began to use the food. (Of course there had been Asian producers of tofu in Asian communities for a century earlier.)

Roughly a decade later the technology for producing long-lasting tofu in irradiated containers reach the market and big chain store shelves.

This is a case where hippies created a new domestic market because of their incredible willingness to experiment with food and their willingness to try new non-meat innovations.

To summarize: tofu, an Asian food, entered the mass American food market via the hippies, a book that demonstrated the use and manufacture of the new product, and sample displays throughout the uniquely hippie distribution food network, was the mechanism.

I told you

Please don’t say I didn’t tell you.

I sold 65% of my stock portfolio today.  Now the money from the sale is all in cash. What triggered my action?

I see from the Wall Street Journal that the Federal Reserve has been driving banks out of the repo market.  Repos are funds created by bank loans for overnight or a few nights. The name comes from 'repurchase agreement.' The interest is trivial.  Maybe $3,000 overnight on a $100 million loan.

The purpose of repos is to create liquidity for financial institutions.  Let say that a broker has a national payroll to meet on a day when customers have sold far more than average and commissions won’t be paid to the brokerage for four days.  That would warrant a repo to cover the payroll today and hold the firm's cash flow over until the commissions come in four days.

The Federal Reserve has recently opened its short term money window to a wide range of financial businesses.  This has virtually eliminated bank repos.  Total bank repos are down from a daily total of $1 trillion to $300 billion.

Repos provide vital lubricant for the financial market in days of stress and chaos because there are many banks who can generate repos promptly.  I think the Fed will not be as prompt and flexible as banks and the whole economy will lose liquidity at the time and moment of chaos when it is most needed.

Which will be…. I have no idea.  The Phillips portfolio curse is: “may you know exactly what the market is going to do but you don’t know when.’

Hackers were there

Awhile back I described my effort find a hacker to search the IRS’ Exempt Division’s private emails and to publish them on the Internet. This publication is vital to expose the greatest case of government corruption in American history.  

It turned out that hackers are too young to make it possible for my contacts to work with them.  Hackers can’t trust a person older than they.

Which is my reason for a paean to hackers.  ‘Hacker’ is a word that should be applied to our language retroactively.

Nearly all the improvements in the automobile came from home workshop mechanics.  The same was true for telephones (I met the inventor of the touch tone system in his garage). It was true for many inventions including the computer.  John (Cap'tn Crunch) Draper was a phone freak who taught Steve Wozniak about computer circuits and himself invented the earliest word processing system. One Briarpatch member was the homebrew fellow who created the popular digital phone-computer connection program.

What is significant about modern hackers is that the word should disappear now.  Writing code for smartphone apps is done by millions of young people worldwide who are inventing the future.  They owe their inspiration to the legions of hackers who went before.

Herb Allen

Who is Herb Allen and why is he the subject of one of my blogs?

Herb Allen is a genius whose role in American business deserves great respect.

During the period of an hereditary elite in the United States, before 1960,  that elite had their own private clubs where important information and deals were carried out in complete privacy. The Bohemian Grove Summer Encampment is a residual of that era. The people who go there still have some elitist aura for those two weeks in the summer.

Herb Allen has an annual gathering in Sun Valley, with so many private jets that they are parked all over Idaho wherever there is airport space. The guest list is made up of wealthy successful media moguls and people in related fields. No elite hereditary guests. Most important deals at Herb Allen's gathering become public fairly quickly.

Herb has his company pay for the entire elegant event including entertainment for the spouses and families. His company benefits in the realm of mergers and acquisitions.

I admire what Herb has done. It is important and it is valuable to the world of commerce.

Why do I have anything to say, in this blog, about Herb Allen? Because in the early 1980s I was in a public debate with Herb, in Virginia, about the nature of money and money in your private life. My shtick was about simple living and commerce. Herb’s was about the benefits of getting rich.

Herb and I privately had drinks together and discussed the details of Herb’s life. Herb had used one marriage to get a job on Wall Street and another marriage to fund his portfolio at the job. I told him that ‘commerce’ has no moral qualms about this but that I didn't believe he should or could recommend that behavior publicly. Which he didn't.

Back to the theme of this blog. While I think Herb’s private morals may at one time have been out of sync with general American values, he has, with his annual soirée, made a major positive contribution to American commerce.

Robin Williams and our times

I take the unusual global outpouring of appreciation of Robin Williams as a recognition of the present as the darkest period in the world since WWII. We see him as the single ray of sun through the storm clouds. He wasn't an actor, he wasn't a comedian.. he was a comic person to a global audience. This outpouring comes in the same year and for the same reason that Pharrell Williams song 'Happy' became a global sensation. (My connection to Robin Williams)

Thomas Piketty II

I have recently read Thomas Piketty’s book Capital.  It was a gift from a wonderful and generous friend.  I wrote an earlier blog, over three months ago, about Piketty’s book based on reviews by Robert Solow and Gregory Mankiw.

My blog three months ago was in perfect timing to coincide with the ideological scaffold of Lefty-union politics about income distribution that was being promoted at the time by President Obama in his fund raising ventures.  Piketty was consequently the subject of great interest in the pop media world and the professional economics world.

What Piketty has done is to look at major nations’ data on income distribution and productivity going as far back as he can. In some cases he can go back several centuries. In most cases he gets less than a century of data.

Most of his data comes from France, where he did his own extensive research. Other parts of the developed world were added by Anthony Atkinson.  The most relevant part for us, the U.S., was added by Emmanuel Saez.

Piketty’s  conclusion is that there is a simple linear relationship between national output, productivity and income distribution. His data apparently is different for most of the world from the United States in the past 40 years, which he admits. He is unable to understand why this data distinction exists. Nevertheless he goes on to predict that significant and perverse global income distributions will persist into the future because productivity increases go to capital which in turn goes to the hereditary richest top of the society.

One chart was surprising to me. On page 348 he shows the percent of wealth held by the richest 1% of Americans going back to 1810.  At the time of President James Madison, the top 1% held 25% of the U.S. wealth. Nearly all wealth was in land. By the time of President Barack Obama, that had risen to 32% with virtually none in land.  That 7% increase over two centuries seems to be driving Obama and the Democrats nuts.

I see numerous problems with Piketty’s material.

* First anything abstract at this level is subject to ideological distortion. The best example is Malthus who wrote a book in 1798 projecting global famine. His linear projections of food production and geometric population growth did not take into account the radical technological improvements in food production that were occurring in England at the exact time he was alive. The abstract equations looked fine. The reality had no connection except in countries that continued to have Malthusian levels of food production.

* The second problem is that Piketty and Saez do not acknowledge how the structure of income distribution in the United States has changed since 1960. We no longer have an hereditary elite class that can pass on its capital to its family. The rest of the world does.  I explain what caused the change here.  396 of the top 400 billionaires in the U.S. did not come from the hereditary elite.  Nearly 100% of the top economic population in America has earned its money de novo since 1960 as a byproduct of productivity.**

* Moreover the middle class in America gets nearly all of its benefits of productivity in income from capital improvements and capital investments. These benefits to the middle class are promptly passed on in the form of bonuses and stock from their companies. Separation in income distribution from the middle to the top income brackets has no reason to expand adversely.  Middle income families in the urban U.S. now earn over $92,000 average per year. Those in the top 10% earn over $106,000 average income per year.

* Fourth and lastly, projections into the future, have been disastrously bad. Two recent examples are the population explosion and global warming.

Piketty calls himself a Marxist.  This makes one more Lefty making a linear projection into the future.  It may be accurate for the world outside of the U.S. but it is inapplicable here.

** I will discuss whether an hereditary elite class can return in the U.S. in another blog.

Case against franchises

This is rather a black period for American commerce.

We have a president of the United States who has never held a job in business in his life. In the past week we saw two severe consequences of this failure.

The president attacked a practice that is gaining widespread popularity among major US corporations, it is called: ‘tax inversion’. Because the United States ranks among the highest corporate tax entities in the world and especially since it taxes earnings by American corporations outside the United States, an unusual global practice, many American corporations are finding it beneficial to buy a small foreign company and declare that subsidiary as its headquarters.

The president declared this practice immoral. He actually used the words “unpatriotic" and "wrong".

In the same week, the National Labor Relations Board controlled by his appointees and his friends in the union labor movement sought and obtained a federal court ruling against a franchise business arguing that local labor conditions at a single franchisee could be applicable to the entire franchise business.

Let's begin with the preposterous attack on American corporations that are unwilling to pay the highest corporate taxes on their gross global earnings and want to reduce them.

* Corporations have no obligation to a nation that abuses them as the Obama government does. Nobody has an obligation to another person or a government that abuses them.

* Corporations gain only a small benefit, from the overall existence of the United States in their operations around the world. Less and less as the Obama administration continues in power.  Under the current administration the beneficial American activities such as free-trade treaties have failed, the freedom of the Internet backbone and the protective military are on the wane.

Franchises are an important part of American business. There are virtually 0.5 million franchises in the U.S.; nearly 2/3rds are in food and retail. They employ more than half of the commercial employment marketplace. I said 'half", and that number is correct.

The NLRB has now declared that a trivial-absurd labor problem in a single franchisee can result in a legal case against the parent franchise. For every franchise that makes a local mistake this means nine other franchises in the same company will be punished. I call that group punishment. President Obama, that is really UnAmerican.

This group punishment is irrelevant.   The fact is that the relationship between nearly all franchisees and their franchise parent leaves employment practices up to the franchisee. By contract.

The two preposterous attacks on commerce that I cover in this blog, spell a grim outlook for American business.

American businesses are already reluctant to accept the nightmare of an Obama-Democrat-union-environment. Investment in the future is minimal. Things keep getting worse.

The Koran

I wouldn’t have the nerve to write this blog except for two reasons.  First my wonderful friend, Ann, said spontaneously that in preparation for a job with the Aga Khan she had read the Koran and much of the Hadith.  She said it was ‘incoherent babble’.

I had read much of the Koran and come to the same conclusion many years ago. But because I allowed for my own potential failure of understanding, I had never said this out loud.

The second reason, I have the nerve, is that I do not believe that the Islamic world will expand significantly beyond Europe and Africa over this century. Islam will not be a threat to my grandchildren and great-grandchildren. If I believed that Islam would expand beyond Europe and Africa I would fear for their lives because I have written this blog. Islam is a dangerous religion. Partly because it is based on complete incomprehensible babble.

You can find the Koran translated anyplace on the Internet. Try and read any of it if you doubt what I say. There are 114 Suras in no order whatsoever with a great deal of repetition and absolutely no coherence in any two sentences. Look for yourself.

I have read many ancient documents. I have read the Torah; in English and in several versions of it.  It was written and assembled more than 1000 years before the Koran. I have read Sumerian stories, that are at least 2000 years older than the Koran. I have read many Buddhist sutras that are anywhere from 300 to 800 years older than the Koran. The same goes for the Tao d’Ching which is 700 years older than the Koran.

I have read many Greek documents of many sorts that are older than the Koran by 800 years.

In all my reading of ancient documents, translated into contemporary English, I recognize three serious problems.

*First, these are from different cultures.  Cultures are virtually inaccessible to each other. 

* Second, we have no idea what the metaphors and words from these ancient documents actually meant at the time. They are not accessible to us except from interpretation by people who may have passed on verbal descriptions of what these documents were about.

* The third is that we have no comprehension of the social milieu in which these documents were created, read and understood.

I will give three examples of these problems in interpretation. In the Torah, God destroys the town of Sodom because the townspeople were considered evil for offering a visiting Angel several men and not one woman. This makes no current sense unless we assume that sex with men was easily available and trivial. Further the sex with a women was a generous act for a stranger.  It  was an extremely important offer.  To most current tribal groups in the world they know they need fresh external DNA for the tribal survival. That may have been what the story was about. But we DON'T know.

The second example is that in the Torah the prophet Elisha is described as encountering two she bears who tore apart and ate 42 young men who had ridiculed the prophet.  What is this about? My father claimed that rabbinical tradition says this was a joke and we don't get the joke.

Third, most temples of early religions apparently had women available for sex. We don't have any such tradition. However in Japan at Shinto weddings there are still two young women provided by the temple who accompany the priests and the bridal party. Is this connected to a Shinto sex tradition that is 2,000 years old?

Without any real understanding of the periods in which most of these documents were written there is only limited understanding of their meaning to the readers at the time they were compiled.

This is not true of the Koran. It is unintelligible to me with or without knowledge of the era in which it was written.

Uncle Fred

My uncle Fred, who was born Fred Herz, my mother's brother, changed his name during the second world war to Fred Harte,  the English translation of the German 'Herz'. He was uncomfortable as a Jew.  I owe a great deal to my uncle Fred who regularly took me to dinner and let me stay in his rent controlled apartment on 96th St. E. in Manhattan as a college student on vacations from Chicago.

Uncle Fred is the unsung hero of the newspaper published in New York from 1948 until 1992 originally under the name the National Guardian.

Uncle Fred went to Harvard and his close friend, Phil Strauss (later a partner in Neuberger Burman) from school, invested Fred's money for him. By the time the National Guardian had started in 1948, Fred's portfolio was worth several million dollars. Over the next four decades the portfolio continued to grow.

My uncle Fred was the sole funder of the National Guardian from the 1940s until the 1990s. Fred would buy nearly all the tickets to the annual Guardian fund raising bash. The tickets sales were trivial. The total revenue consisted of 95% uncle Fred's money. That was for the entire 40 years of the newspaper's life.

Fred used to go to work at the National Guardian at a menial job every day for 35 years and worked in the circulation department in control of the subscription base. Originally these were metal plates and later became computer tape.

Fred was inconspicuous but he controlled the heart of the newspaper. Fred watched the entire revolution of the 1960s acted out in his offices. First the radical blacks took over the paper, later the radical feminists kicked out the blacks. Little old Fred just kept working quietly in the back room and supporting the entire edifice with his portfolio contributions.

Fred was a dyed-in-the-wool Marxist. We argued and talked for many hours and years. The stunning fact to me, was how often we agreed. Fred taught me a great deal about arguing, about politics and about Leftists thinking.

Fred died in the early 1990’s.

Desalination

Right now, we in Northern California are being lectured, in a mean-spirited way, about the need to conserve water. We are technically in a weather pattern known as a drought. There is actually no connection between human water consumption and the weather around us.  Or their shouldn’t be.

I say this because I am enmeshed in a bureaucratic service that delivers water to me from a dam in the Sierra that gets its water from snow melt. There is enough water in this dam, Hetch Hetchy, to survive several decades of drought.

However the brilliant bureaucrats of San Francisco have sold all the water that San Franciscans don't use, in an ordinary year, to all of the neighboring suburbs. So there is no surplus water coming through the pipes for all of us.  The money from selling San Francisco water is not used to reduce the city water bills, it is used for the city’s unionized employee’s pensions.

On top of this, these brilliant bureaucrats formed an organization around the San Francisco Bay to help share each other's water in drought years. This group of brilliant bureaucrats actually commissioned a study three years ago to look into desalination. This year they looked at the results and canceled  plans for desalination as they await more environmental studies. The proposal for desalination was based on a sensible pilot plant at a location where most of the water from the Sacramento River is fresh and there is a little mixture with ocean water from the Bay.  A desalination plant required too much cross jurisdictional cooperation. It is easier to pressure citizens to shower less.

It is hard for me to take these brilliant bureaucrats seriously. Especially as these wise and intellectually sophisticated people tell me to ration my water.

What makes me so arrogant?

Israel gets more than 50% of its water from desalination, straight from the Mediterranean, not from some mixture of freshwater and saltwater. If Israel, a tiny country with a tiny GDP can afford desalination what is wrong with California’s brilliant bureaucrats that it is better to torture and harass ordinary citizens than to build a desalination plant?

Ads as a base for business

There are thousands and thousands of startup businesses in the Internet world that are planning to build gigantic user bases on the assumption that they can monetize their efforts with advertising.

This is nonsense and bad business.

In the United States the advertising world is roughly $170 billion. Of this, so far, Google has more than $50 billion. There is almost as much advertising in the world outside of the United States.

As a percentage of our GDP this is a little over 2%. For a business to aim its success at 2% of the gross revenues of the United States is mistaken. Especially when Google is getting the bulk of it for doing a real job.

Google is distinct from the others who plan to have little sentences or images inserted for the advertiser. Google connects an actual search by a real human being with a real working desire to a potential consumer for the seller. I called this ‘listing’  not ‘advertising’. Advertising is a scattershot effort to reach anybody who might be interested. Advertising is Mercedes and Kia reaching hundreds of millions of people, 99% of whom are not interested in an expensive or an inexpensive car.

Everyone else planning to build an Internet business on advertising is chasing a mirage. Advertising is a trivial amount of revenue.

I own stock in Google which gets its ad revenue by directly connecting businesses with consumers; I own stock in Amazon which is actually selling real products and services; I also own Netflix which gets its revenue from people who pay monthly to be entertained.

To me the rest of the Internet businesses are based on a bad business model. Especially in an age when businesses are able to connect directly to interested consumers via Google.

Anniversary of GMO

How can August  2014 be the anniversary of GMO (genetically modified organisms)?

It isn't. It is the anniversary of my founding of an organization to label genetically modified organisms in food in the United States. It is the 20th anniversary of my founding of The Project to Label Genetically Engineered Food.

In the Spring of 1994 I was doing interviews for my public radio show in Boston. I was having dinner with a number of brilliant Harvard intellectuals. The subject of GMO food came up and I was dismayed to hear the argument that GMO was no different than traditional crop selection. I couldn't believe the mistake these brilliant people were making.  Bad metaphors make bad policy. Since they were spouting mainstream wisdom I knew I had to do something to stop that.

The argument that GMO is no different from traditional breeding is still heard from defenders of GMO (such as Henry I. Miller). It is false.

There was never a way that a traditional breeder could put a banana gene in a pig.  GMO includes fish luminescence genes in tobacco plants.  Picture what the sex between the species of pigs and bananas and fish and tobacco plants must look like.

When I started my organization I was delighted to find that there were already two organizations in the United States opposed to unlabeled GMO food. One was Consumers Union and the other was a consumer science organization in Washington DC.

Very quickly we found allies in our battle; we found support in the organic food movement. I knew most of the leaders in that world, having helped start some of the founding organic associations in the Briarpatch.

We joined forces in pressuring the Department of Agriculture to define ‘organic food’ as excluding GMO. We had hundreds of thousands of letters submitted in the comment period.  We won that battle. Food in the U.S. labelled ‘Organic’ can not contain GMOs.

I disbanded my organization. But I still have envelopes from that era.

My concern was that there could be harmful human effects of GMO food. With a distinction between organic and nonorganic food I knew it would be easy to detect any low level medical or related problems in the population.  Some people might have the problem, but organic purists wouldn’t.

It is now 20 years later, we have had no problems whatsoever with GMO food, which a billion people consume everyday. To me that is sufficient evidence. I still hear crap about GMO seeds getting into non-GMO fields or harming some imaginary butterfly or bird. Not a shred of evidence supports any of this.

Nevertheless, all the work I did, all the effort built into organizing has been washed down the drain by the low level of intelligence of the anti-GMO, anti-modernity Left. They are still attacking GMO. Much of the most successful opposition to GMO comes from the anti-commerce anti-modernity Europeans.

Rejection of evil creates evil

I have done two recent blogs on evil, here and here.

I want to add an additional point that there is a higher order of evil that we do not often identify.

That higher order of evil is the one that denies the existence of evil or simply believes that evil doesn't exist. The two are not the same thing one is aggressive the other is passive.

I have spent an inordinate part of my life with Lefties and pacifists and do-gooders. I can explain their universal viewpoint, the viewpoint that allows them to hold the position that there is no such thing as evil.

These people believe that the level of perception on which evil appears is the problem. A higher level of perception will always reconcile the differences that we call evil.

Since I am living today in the middle of an era of anti-Jewish pogroms throughout America,  Europe and the Middle East I can use this example. The people who deny or ignore the existence of evil will cite the case of the Israelis versus the Gaza Palestinians as a an example. They say evil doesn’t exist there.  Just misunderstanding.

To them, the killing on both sides is misguided. It can only be seen as evil by either side as long as one views the other side as having a malevolent position, an inhuman concern and an erroneous historic background.

The problem, these people say, can be eliminated if we move to a higher level where each person or groups of warring people can come together and recognize that they are parents, human beings with needs, and part of a universal human family that needs love and appreciation.

At this higher level it is possible, in fact inevitable, that the two sides will be able to find common ground.

This perspective as false. I see this perspective as evil.

There is such a thing as evil in the real world. There are many situations in which a an evil person tortures an innocent person (or other being). Moving the perception of the situation to an higher order is doing nothing but excusing the real evil. Thus, willfully supporting the evil in the actual situation.

My classic example is the Jew hatered that has dominated Europe for 2000 years and resulted in the countless abuses, tortures, pogroms and genocide of a completely innocent Jewish population by a dominant Christian society. A perfect example is the founder of modern Protestantism. Martin Luther wrote over 100 pamphlets expressing his hatred of Jews. He had never met one. That unwarranted hatred was and is still one sided evil.

I repeat my blog headline. When we reject the existence of evil we have created a new level of evil.

Vassar girls and black men

I have already offended a large swath of Lefties who would call me a racist no matter what I said because it is the vituperative word in vogue for the past six years.

The truth that has been unspoken in our society, except by me, is that we have a hereditary black criminal class in our society. These young black men, mostly men, begin life with the determination to be criminals. They don't change their attitude while they live. This has been a development in the black community beginning sometime in the 1980s.

I may as well speak another truth that has been unspoken all my life.  Before 1960, my fellow males often talked about the 'Vassar girls and black men'. The Vassar girls symbolized all young liberal females who believed they were guilty for American slavery; the only expiation was to have sex with one or more black males.

What I would like to tell my historian readers, is that this very same behavior continues to this day more than 65 years later.

During this 65 years I have seen one woman filled with so much guilt that she had to go to Haiti for her sex with black men. She died three months later because she arrived in Haiti along with the earliest, most virulent, AIDS virus. I have seen another woman who gave millions to a black foundation that had no particular merit other than a black leader; it grew out the sexual relationship between the black leader and the rich white woman.

Since I worked at a black church for more than a decade, I can say that many of my black male friends benefited from this Vassar girl phenomenon. They were delighted (and I was envious of the occasional beautiful white girl).

The phenomenon has not abated at this point in my life. It long ago spread from the Ivy League girls’ schools to the entire country and possibly to other countries.

This phenomenon should not be confused with the mixed marriages of whites and Asians which has no similarity. It should also not be confused with white male sex with black females, called Poon Tang in slang, which dates back to the days of slavery.

What 8 years can do

This is a blog I wrote eight years ago about a comedian I had seen.  He phoned me after reading the blog.  He was disappointed with my reaction.  I encouraged him.

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Mar 23, 2006

Comedy on the right

Last night I heard a comedian who is working the Republican Jewish Coalition circuit.  Evan Sayet is developing his shtick as an hour long standup comedian with conservative groups.

Sayet is a great comedy writer and his material is really impressive.  As a comedian, where timing and delivery are everything, he is mediocre.  I look forward to the day a really great comedian comes along and uses Sayet’s material.

One of Sayet’s observations is that Jimmy Carter was the first president with a child’s name.  Carter was a cowardly incompetent president and remains a petulant bad boy.  Another of his observations is that Lefties have only three words in their platform: 'liar, Hitler and stupid'.  He got the audience to repeat those words by asking the audience what the Lefty platform is on: social security, national security, the environment, Katrina and health care. 

He noted the Lefty hypocrisy in naming their TV programs: Hard Ball with Chris Mathews (never hard ball), Politically Incorrect with Bill Maher (always politically correct) and Larry King Live (live?).

(Sayet used to write for Maher and describes Maher as incredibly arrogant.)

The relevance of last night’s show is that the Left is now in a phase of being ridiculed.  Ridicule is the prelude to demise and sometimes to rebirth.  I can’t see today’s Left being around in its current form several years from now.

Posted by Michael Phillips on Mar 23, 2006 at 03:47 PM 

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Sayet has since become a master of standup comedy and brilliant as well.  This is a nine minute exerpt from an hour long piece.