Are those in power wanting the currency to fail so they can install a new currency? Of course the new currency comes with new laws that grant privileges (that can be taken away) as opposed to rights which are ‘god’ given.

When things get bad enough ie hyperinflation, the disappearance of our savings to buy hundred dollar toilet paper, etc. it seems then we’d all be willing to accept any solution even the giving up of our rights for ‘privileges’ in order to make the pain of inflation stop.

Is this some version of what the next 5 years might bring in your opinion?

My answer:

A new currency might happen. It won’t really affect what we are facing, though. It will merely be a smoke screen. I am skeptical about hyperinflation. I have no crystal ball, but I don’t see how that could be the final outcome. Here’s what I think:

We are in a DEflationary time. Debts are either being paid off, which reduces the money supply, or are being declared unpayable, which also reduces the money supply. When a debt is made (ie, money is lent), the original money still exists, in the hands of the borrower, while new money, in the form of the IOU (bond, mortgage,  etc) now also exists. If the borrower is thought to be a good credit risk, and it is assumed that he will pay back the debt (which is what happens in normal times with most debts), the debt creates a doubling of the original amount of money that was lent: $1000 lent becomes the original $1000 plus the IOU which can now also be used as money (“I’ll give you this IOU in exchange for that item I want.”). This is how inflation happens (this is a simplification–this creation of credit money happens in many ways–this is just a simple example).

When the original debt is paid off, the IOU is then no longer worth anything (nothing is owed any longer). The extra credit money created when the debt was initiated disappears. There is another possible outcome, though. If, instead of the debt being paid, it becomes obvious that it cannot be paid–as with, for instance, all the mortgages people took out to buy houses they really couldn’t afford, or all the student loans that can’t be repaid because those who owe it can’t find work–the IOUs also become worthless. Whether an IOU is paid, or can’t be paid, it is no longer worth anything, and the credit money it represents disappears into the same thin air out of which it came.

Ordinarily, credit money is a good thing. It is, in fact, the essence of capitalism–it is the “capitalizing of an asset”. This means an asset is turned into capital. The purpose of this is to use the asset (without consumming it) to create more wealth. Wealth isn’t really the money, though (money just represents wealth). Wealth is actually more stuff–more things that make life easier: products, medicines, infrastructure, clothing, food, machines, and so on.

Before people had this idea of capitalizing assets (in the 1300s), people generally worked from sun-up to sundown just to create enough wealth (again, stuff–especially food) to stay alive. The nobility took part of that “wealth” in (supposed) exchange for protection, and also because they claimed they had a “divine right” to it. The protection, of course, was actually provided by the same people who were raising the food (the wealth) that the nobility were living off, as these serfs would be conscripted into the army whenever there was need of protection.

Once capitalism began, however, assets could be offered as collateral for money (ie, capitalizing those assets) and the money could be invested in something: ships to bring goods back from foreign lands, or the creation of a mill to create cloth, or whatever it happened to be (later, as capital formation drove the creation of machines, the whole thing accelerated and consumer goods, fuels, new technologies, medical miracles, etc, were created with this “capital”). Wealth (stuff that made life easier) was created. In fact, over the next few hundred years so much wealth was created that humans of all classes began to enjoy leisure time, medical care, paved roads, indoor plumbing, a much healthier and consistent food supply, and on and on.

This ability to capitalize assets (ie, the process of capitalism) completely changed humanity from subsistence to a whole new way of living–one most of us take for granted, since most people are largely ignorant of history, and certainly ignorant of financial history (and the progressives who now control the schools and the media and the government don’t want you to know how important capital formation is to YOUR LIFE and YOUR COMFORT–and, in fact, how important it is to the poor).

There are places in the world where many people still live at a subsistence level, of course. These places, however, are poor at least in part because they don’t have capitalism and the legal protections that allow it to operate (methods for legally transfering property, strong courts that guarantee the sanctity of contracts–so promises must be kept, even by the powerful–and “honest” money [which I will explain in a moment]). Hundreds of billions of dollars of assets, of wealth, sitting in third world countries and which common people “own” for all intents and purposes (their family has lived there for hundreds of years and cannot be evicted), cannot be capitalized. Why? Because these “owners” have no deed to the property because there is no Western system for owning and transfering property. There is no way to transfer ownership of these assets other than to informally transfer them to their children. For that reason, these assets cannot be capitalized–used to create more wealth.

The other poor places in the world have socialist economies/governments, where capital formation isn’t part of the mix: Russia, North Korea, Cuba, etc. These are the places from which people are trying to flee, in order to get into the places in the world where capital formation is allowed: The US, Singapore, Hong Kong, some countries in Europe, etc. (the list used to be longer).

I’ve gone on about capital formation at length for a reason. Capitalism grows the pie. In other words, it creates wealth. Most socialists and advocates of centralized control assume that there is a pie of a certain set size, and if someone (an individual or a country) has more pie than another, they had to have stolen it from those who have less. Though this certainly has happened in history, and no doubt still happens to some extent in some situations, most of the wealth any rich person or country has is the result of using capital to create more wealth, not from the stealing of wealth. The laws that protect private property and contracts are designed to prevent this theft, though today those guarantees are breaking down–though not from a failure of capitalism. (More about what is going on when this stealing does happen below.)

So, to get back to the deflation I was describing: As debts are either paid or acknowledged as unpayable (credit extinction), the debt side of the asset/debt relationship disappears. This is called deflation, just as the creation of the additional “money” (through credit creation) is called inflation–something that has been happening at a very high rate since we stopped backing our money with gold in the early 1970s. Today the debt has become too big to service (ie, pay the interest on and still have anything left over to live on). In that period of time a dollar has shrunk in buying power by (my educated guess–too lazy to look it up as I write this) about 1/12th. This means (assuming my guess is right) that it takes $12 to buy what $1 bought in 1970. Things don’t really cost more today–it’s more accurate to say that the money is just worth less because so much of it has been created out of thin air.

This creation of money out of thin air (the money creation I described when a debt is created) is A GOOD THING as long as the money goes into something that in turn creates wealth. If someone uses the money to start a company and create something people want, wealth is created, jobs are created, and the economy GROWS. Ideally, it grows enough to compensate for the increase in the money supply created by the debt. In that case, there is no inflation. (In actual practice, in some years there is a little bit of inflation and in others there is a little bit of deflation, so it evens out–ideally. A gold standard (again, ideally) keeps things from getting out of hand one way or the other, because people/countries have to part with gold when it does get out of hand, and this is a strong motivator–when there is a gold standard–to maintain honest [non-inflationary] money.)

If, on the other hand (and this has been happening for many years now–one of the many results of no longer backing our money with gold), the debt money goes for consumable items–items that do not generate wealth, but are simply consumed (furniture, homes, cars, stuff you put on your credit card, etc)–then you have debt that doesn’t create wealth. This debt is referred to as “non-self-liquidating debt”, because it doesn’t create the wealth that a) grows the economy, and at the same time b) provides the money to pay off the debt itself. This kind of debt does create inflation (which is why since 1970 it takes 12+ dollars to buy what could be bought then for $1). Debt that creates wealth is self-liquidating debt, because it creates enough wealth to pay off the debt, plus enough to make the creation of the company or other enterprise worth all the risk and work (ie, it makes a profit).

At any rate, in our current environment, the huge amount of accumulated debt (most of which is NOT self-liquidating) is either being paid off or found to be unpayable. This causes huge amounts of money (most of which is unpayable debt) to disappear. All the bailouts and QE 1,2,3 etc. are attempts to creates new debt to replace it, so as to avoid the deflation that naturally happens when debts go to money heaven.

Once true deflation starts it becomes a chain reaction and leads to the sorts of things that happened in the 1930s–foreclosures, massive loss of jobs, huge poverty, huge suffering (hmmm–a lot like what’s happening today). The whole society is forced to live on less while the debt is being ”repaid” (all debts are repaid–if not by the borrower, then by the lender). In our current situation, stuff was created, bought, and consumed before the money was there to buy it (in otherwords, it was purchased on credit), and now, finally, the piper must be paid. When you start paying back a debt you obviously have less to live on while you’re paying it back. This is happening all over the world, and EVERYONE (save a few who have the reins of power and can use force to steal from the rest) will live at a lower standard of living. And, I would predict that this process will continue for DECADES, perhaps generations. That is how huge the debt is that must be paid (the debt is many, many times the value of EVERYTHING of value in the entire world).

Right now the powers that be are pumping more debt money into the economy (through bailouts, “quantitative easing”, etc) to try to replace what is disappearing through the disappearance of credit money, also called deflation, or deleveraging. So far those powers that be are keeping up–they are creating just enough new credit to make up for the old credit that is going to money heaven. Once deflation really gets going, though, they won’t have a prayer of keeping up. This chain reaction came within hours of being ignited in the last meltdown a few years ago, where most people lost 40% of their 401k’s. The powers that be probably won’t be able to forestall it a second time, though.

There is one hope, though–and this is the only escape for the government and the big banks who are pumping all this new debt into the economy:

If the economy GROWS (enough wealth is created that the debt can be paid), the collapse that every deflation leads to might be avoided. Unfortunately, the economy is NOT going to grow enough (if it grows at all–today’s growth is miniscule and shrinking, and may must be statistical smoke and mirrors). First, it’s very difficult for economies to grow in this environment (HUGE HUGE debt, no jobs, etc). The reality is that the economy will not grow until the debt has been “paid”–until the deleveraging, the deflation, has run its course. If we had a much smaller amount of debt–perhaps what we had 15 years ago, we MIGHT grow our way out of it. Now, it’s too late. The debt, as I said, is greater than the value of EVERYTHING. The amount of growth needed would be some truly magical growth beyond anything the world has ever seen.

And, to make matters worse, in times like these–times of increasingly negative social mood–governments become more authoritarian and LESS free market oriented. Capitalism, you may have noticed, is being blamed, demonized, restricted. The very engine that needs to be set free is fettered. More regulation and ways to block capital formation are created everyday. While Obama (to pick one example) talks about increasing jobs and growing the economy, those who are watching what he actually DOES are seeing action after action after action that blocks capitalism and the free market from working. You would think (and, as a matter of fact, I DO think) that these guys are sitting around trying to NOT grow the economy.

Finally, when government gets this large, and centralizes this much power, there are many huge international companies that line up to suck on the government power tit, which is why they CAN steal from others. Without that government power (I have said this many times on this blog) these companies a) would never have become so big, and b) would have one power, and one power only–to create and sell a product to those willing to buy it voluntarily. Unfortunately, I don’t have room here to go into the reason why this is so. Perhaps in a future post I will discuss why centralized power (not capitalism) is the source of the problems we face.

At any rate, we are faced with a HUGE, unimaginably high debt that will never be paid. It WILL disappear through non-payment. This WILL cause a massive deflation (a contraction of the money supply, as everything that really has no value, because it’s just unpayable debt, is extinguished), and no amount of government or Federal Reserve Bank creation of more credit-based funny money will help.

First, there is no way to create enough new credit money, and there is no way to actually get it into circulation in the economy. Second, even the money they are creating now is just sitting there in banks as little 1′s and 0′s in someone’s computer. This allows the banks to PRETEND that the assets they hold (all the many kinds of debt instruments that can never be paid) are actually worth something. 98% of these “assets” (“promises to pay”) will eventually be shown to be worthless. Even now, the banks don’t want to lend the funny money the Fed is creating (they just want their balance sheets to LOOK better), and in this environment there aren’t any worthy borrowers out there who want to borrow it and use it to create new companies and new wealth.

What is coming is a massive game of musical chairs, where the chairs are money. Money (and by that I mean debt instruments–someone’s promise to pay) will disappear as it becomes obvious that the promise to pay cannot be kept. 7 billion people will be scrambling for a chair as most of the chairs disappear. If you have money in a bank–which has lent out 30 times as much as they have deposits (this is called “fractional reserve banking”, and it is legal!)–and just 3% of the depositors come to the bank and ask for their money (this is called “a run on the bank”), the other 97% will get no money, no chair. In fact, long before a run happens the government will do something to make it look as if this isn’t happening. They will ration withdrawals for some other supposed reason. This same thing will happen (a failure to make good on the promise to pay) with bonds, money market funds, pensions, 401Ks, and a thousand other debt instruments.

If your “wealth” is someone’s promise to pay (and it probably is), you will quite likely be left without a chair. But don’t worry. Obama (or one of the other central planners in the world) will take care of you. At least that’s the promise. I’m a bit skeptical (based on the history of these sorts of things, and the facts of the situation today) that these guys will be able to make good on it when the time comes, though.

What’s more, historically goverments (which become quite authoritarian in such times–voters actually DEMAND more authoritarianism at such times, a form of insanity to be sure) always make whatever a prudent person would do to protect himself in such circumstances illegal. Again, I don’t have time to give lengthy examples, but I can think of two off the top of my head: hoarding cash (actual currency), or moving money out of the country, to places where it might be safer. Both of these will eventually be strongly discouraged, taxed, or outlawed. Those who move money offshore are already demonized. What’s wrong with these greedy people who don’t want to lose their money?

So here it is, in a nutshell:

1) Capitalism allows assets to be “capitalized” so they can be invested in something that creates wealth. This has raised the standard of living of humans by probably at least 100,000% since the 1400s.

2) At a certain point, the safeguards that keep this process honest are removed. Two I can think of are the creation of the Fed in 1913 (very anti-free market) and going off the gold standard in 1971. This allows legatized stealing by the government and huge corporations who ally themselves with the government.

3) The age of consumer debt (debt that creates no wealth but is just used for consumption) creates inflation, in addition to debt creation for massive government spending, destroying the value of the money and becoming a silent tax for the entire population.

4) The debt eventually becomes so large it is impossible to pay. We’re there, folks.

5) During this time the size of government increased by huge multiples, controlling decisions individuals used to make for themselves and adding layers of expensive regulations so that the entire society becomes like an afternoon at the DMV and huge corporations are allowed to grow and to use government power to legally steal.

6) Eventually the debt begins to DEflate–the game of financial musical chairs begins. During this time the whole world (since the whole world is so interconnected financially today) is forced to live at a much lower standard of living. This goes on until the debt is paid. In our case it’s going to take a L O N G time. It took about 20 years after the 1929 stock market crash. This is going to be worse–the debt is MANY times larger. MANY MANY MANY times.

7) Radicals and demagogues become mainstream and take over governments (and the media, popular culture, and the educational system) all over the world. The demagogues say, “Follow me. I know who’s to blame. Let’s get them!” Think Hitler, as one historical example. Hitler was ELECTED. In such times people admire this sort of person (at the time, Hitler was admired–only after the fact was it obvious who he really was) and want more authoritarian control (again, insanity).

8) When things hit bottom, you will hear people saying that the world is coming to an end, and that capitalism is dead (it won’t be, though–all other systems only create enough wealth for survival, and people aren’t so stupid that when this becomes apparent they won’t revert to sanity. Let’s hope we live that long.)

So what can you do? I’ve already said on this blog that we are in a car that has already been driven off the cliff, and now the people in the car are asking how to avoid the crash. There will be no avoiding of it. The car will hit the bottom of the canyon. I wish it weren’t so.

I don’t know exactly how this will play out. No one does. Everything is at best an educated guess (and, there are a lot of guesses by those who have no idea what all the variables are–uneducated guesses). In every case in history when this sort of thing has happened it has ended in a massive war. That will, no doubt, happen this time, too.

Who will be involved? There are huge tensions between European countries. There are huge tensiosn (beyond tensions, in fact) in the Middle East. There are huge tensions between China and Japan.  There are also tensions between many social groups. There is talk of states seceding from the US, just as in the American Civil War. Could there be another civil war? Nothing, at this point, would surprise me.  

In the coming years those who have become dependent upon government will ultimately be stiffed as the governments fail to keep up with what they’ve promised to their dependents, who will then be extremely angry. (This is already happening, actually.) This will cause riots (or worse), as is already happening in Greece and the Middle East. The public has no idea that all of this is going to happen, or what the real cause is. They are listening to demagogues who will point them to who they ”should” blame. Right now it looks like this will be “the rich”, corporations (those in league with big government deserve some of the blame), and capitalism and free markets (which doesn’t deserve the blame–it’s our straying from these two that has caused this mess). It may also be “The Jews”, as it was in the 1930s and 1940s (and in quite a few other times of negative social mood over the last few thousand years).

What can you do? Be out of debt if possible, or be prepared for the consequences of not paying your debts, whatever that turns out to be. Store some food. Have some actual cash not in a bank. Have some gold. Have a network of loved ones you can count on. Stop voting for people who are dishonestly making the debt (and the eventual consequences) bigger. Consider tapping into some of the sources of information I listed in my last few posts, so you know more about how things are unfolding. Consider what you would do if social services, utilities, and the infrastructure you count on are either temporarily out of service, or perhaps even out of service for a long time. And, please, use your Holosync. You’re going to need the awareness and higher threshold for stress Holosync creates in the coming years. In fact, it might save your life.

Quite frankly, I have no pat solution for all of this. I don’t know how it will play out, or when. I see all of this in process right now, though. I know what I’m saying here sounds really negative, and really scary. What can I say? What I know leads me to draw these conclusions. I hope I’m wrong. I don’t think I am. Whatever happens, life will go on in one way or another. The best things in life ARE free. A lot of people are going to learn to focus on those things in coming years, and less on the newest electronic toy or some other external item.

And, as life goes on in the coming years, people will need things, and you can be someone who provides those things. You can start a business, if you want to, or work for someone else who is providing things people need. You CAN create a good life, even in bad times, especially if you don’t get unconsciously caught up in herd-like negative social mood. Be like a Boy Scout. Be Prepared.

Finally, I’ve written these last 4 posts, plus this one, knowing that they might be quite unpopular with some people, on the assumption that if you’re aware of what is happening–rather than just being unconsciously swept up in it–you have more choice about whether your emotions run away with you (and you angrily follow the radicals who want to lead to you) and blindly follow the negative social mood herd. And, you may have a chance of being more prepared.

To all of you who want to attack me for posting this, save your strength. I’m not interested in having angry debates (as happened with the last several posts) with uninformed people. Don’t shoot the messenger. If you can prove to yourself that all of this is baloney, good for you. If you have legitimate questions, and can’t figure out how what I’m saying squares with something else you’re pretty sure is accurate, please ask. Ask with some respect, though. Name callers will just be deleted and banned. I don’t have time for that sort of crap. I have a lot to do, and a lot of people relying on me. I don’t have time to read angry rants or to pick apart the faulty logic of uninformed people who wouldn’t change their mind anyway no matter what I say.

You might go back and read my three posts on Going to Hell in a Handbasket, because a lot of what I said was going to happen in those posts now HAS happened, or is happening–which ought to give me some credibility. Some of the very smartest (and reasonable) people in the world see things the way I do.

I wish all of you the best. As always, be well.

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July 12, 2012 – Some of my new subscribers may think that I enjoy bear markets. Believe me, nothing could be further from the truth. I have five children: four girls and a boy; I have two ex-wives, and a sister who is four years younger than I am. I feel responsible for all these souls, and the last thing I need is a brutal bear market to struggle with.

I also have a real allegiance to my subscribers, many of whom have been with me for over half a century. In view of all the foregoing, I can say with full honesty that I don’t enjoy or look forward to bear markets.

I say this with the knowledge that “whatever can go wrong, tends to go wrong in a primary bear market.” And we are in a bear market — one that ultimately may turn out to be the worst in history.

I assume that most subscribers were surprised by yesterday’s site, in which I wrote about the US unilaterally raising the price of gold. By now, everybody knows about the danger of our nation continuing on its current path. Aside from the “fiscal cliff” coming up, our whole politico-economic set-up isn’t working. Something drastic must be done — such as a new monetary system, and a new government set-up. The fact is that our Congress isn’t functioning intelligently — in fact, it just is not functioning. Congress is disgustingly corrupt and much of Congress is in the grip of lobbyists. Too many people enter Congress medium-poor and leave Congress rich. The President spends far too much time running for a second term. We should elect presidents for a single six-year term, and then the president should go home and do something else, that hopefully, is useful. The Supreme Court members should be elected, not appointed.

In other words, our whole system is, today, tied up in knots; it’s just not working. We need a non-corrupt political system and a new monetary system. Personally, I’m in favor of any system that actually works on an honest and sustainable basis. Our current system doesn’t work. If it did work, we wouldn’t be in the God-awful mess we are in now. And no, I don’t enjoy bear markets. And I don’t enjoy bull markets that ultimately take stocks far above known values, followed, usually, by a crash.

The old gold standard worked reasonably well. It forced monetary discipline on the nation. The Federal Reserve is an abomination. The nation ran for many years without a national bank, and it was never in the fix it is today.

The Fed is a monopoly run by bankers, for bankers. It should be abolished. Well, there’s no sense in my going through the whole government piece by piece.

The gruesome fact is that this country is not running in a way that is sustainable. As it is, we are leaving our children and grandchildren with a debt-choked nation that is technically bankrupt. We’ve substituted fiat, man-made paper notes for gold. Our whole nation is in hock. Cities, counties and states are now bankrupt and are unable to pay their bills. Raising the price of gold is a stop-gap measure. We’ve got to toss out what doesn’t work, and go back to the drawing board. And if that’s what a bear market will do for us — then let it rip.

But it won’t be that easy. When a nation has a fundamental disease, nobody (certainly not the voters nor the politicians) wants to take the pain of a real, honest, bear market cure.

Subscribers ask me how we could unilaterally raise the price of gold. Easy, one day the president (Roosevelt did it) announces, “The price of US gold is now $4,000 an ounce.” Period.

Three of California’s cities — Stockton, Vallejo, and San Bernadino — have filed for bankruptcy. What about their muni bonds?

Last Friday, the city of Scranton, Pennsylvania, sent out paychecks to its employees, as it does every two weeks. But these checks were for amounts significantly smaller than usual because Mayor Chris Doherty reduced all city employees’ pay — including his own — to the state minimum wage of $7.25 an hour.

I note that new highs on the NYSE are dropping off with each new day. Today there were only 107 new highs.

Of the 19 sectors that Dow Jones posts each day, 16 were down today, signifying broad weakness. The VIX is still low, at below 19, and calmness and confidence is apparently the order of the day. Today, with such low volatility, it’s inexpensive to buy downside protection (puts). The thought is that if there is any danger, the Fed will immediately act. Thus traders feel safe, which is one reason the VIX is so low. This is a very professional market. Joe six-pack and his wife are not in this market. They’re still in shock (if not broke) following the 2008 crash..

Is history repeating? This is the longest job recession, 53 months, since the Great Depression. The Midwest is suffering the worst drought since the “dust bowl” of the 1930s. The movies are showing the scariest stories since the 1930s. Then it was Dracula, now it is vampires. Then it was the birth of radio and news beamed across America, now it is the birth of the Internet and news beamed across the states and the world.

 [This is not Russell's entire daily post, but I thought was important that you read it. His subscription isn't cheap, but well worth it. Consider subscribing if you can afford it.]

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Some of you have criticized me for not writing “strictly” about what you see as personal or spiritual growth. My contention, however, is that everything I’ve written IS about personal and spiritual growth. (If you’re new here, welcome—and, please consider reading the entire archive of posts from the beginning—I know, it’s a lot. You’ll be glad you did.)

If you’ve read my three most recent posts, you know that I’ve suggested that social mood swings from positive to negative and back again in definable waves. (Google “socionomy” for more info, or read my posts.)

Around 2000, one of the largest waves of positive social mood in recorded history peaked. Since then we have entered a time of increasingly negative social mood. This negative social mood will be (and already has been) interrupted by shorter periods of temporarily more positive mood just as the positive social mood that began around the time of the American Revolution was interrupted by intervals of negative social mood. The American Civil War and depression and war of the 1930s and 1940s were such times, as was the strife and chaos of the 1970s.

During times of negative social mood certain unfortunate/unpleasant things tend to happen. These include:

Financial crisis.

Polarization between every social, racial, ethnic, political, gender, and national group.

Radicalization of political thought and action.

A decline in civilized behavior; an increase in rudeness, demonization, blaming, violence, and cruelty.

Less order, more chaos.

Increased fear, anger, confusion, discord, and destructiveness.

Avoidance of effort; a decline in motivation.

Increasing pessimism; a decline in optimism.

Less trust; more suspicion of others.

Increased belief in magic, lowered trust in science and rationality.

Increased authoritarianism and centralized control (including public requests for more of it).

A decrease in personal freedom.

Popularity of conspiracy theories.

Public demonstrations against almost everything—and an outcry for the authorities to “do something”.

Health epidemics.

Strange and destructive weather phenomena.

Increasing negativity in movies, art, music, and other expressions of pop culture.

A proliferation of scandals.

Demonization of those who were previously societal heroes (the successful, for instance).

Hero worshiping of outlaws, pirates, and gangsters in popular culture.

And a lot more.

Unless you live in a cave, you have to have noticed that these things are, indeed, already happening.

Eventually, of course, things will turn positive again. The studies I follow indicate, however, that the overall trend will be negative for quite some time, especially given that the previous wave of positive mood lasted more than 200 years.

Major times of negative social mood (and this looks to be the biggest so far since the 13^th century) almost always end in major wars. For instance, the Panic of 1837 led to the American Civil War. The depression of the 1930s led to World War II. I could give many other examples, but a full discussion of social mood is not my intention in this post. For more information, read my last three posts.

So let me get to my point. Many have asked (often in a less-than polite way) why I’ve written about social mood and its many socio-political-economic consequences. It isn’t “spiritual”. It isn’t about “personal growth.” It seems “too political.” It’s “too negative”.

Is there a connection between this information about social mood and my usual topics of personal and spiritual growth? Do I have a political agenda? Am I being negative or increasing the negative mood by bringing up all of this?

Unfortunately, many people have what I think is a narrow view of spiritual and personal growth. I would contend that in a larger, “big picture” sense spirituality isn’t about finding God, being grateful, quieting the mind, raising your kundalini, jumping off the wheel of life and death, learning to be good, following rules a spiritual leader has laid down, and so forth.

All these things are fine, and many are good for you. I’m not against them. I’ve done them myself (and still do some of them). Let’s ask a bigger question, though: Why do human beings do such things? What is the purpose behind them, the motivation?

I think human beings do these things because they are caught in a very interesting situation over which they have little (and sometimes no) control.

Life contains many suffering-inducing double binds (in other words, “you’re damned if you do, and damned if you don’t”). One of those binds is that much of the juice of life is in being attached to something: people, situations, outcomes, possessions, and certainly to ourselves. Even a quest for God or enlightenment involves an attachment.

But to the degree you’re attached to something, you open yourself up to suffering. Why? Two reasons: 1) You often fail to get that to which you’re attached, and 2) Even if you get what you want, it is impermanent and eventually ends, falls apart, dies, etc. Of course this also applies to your most prized attachment, your own existence.

Because of this bind, we have to choose between being attached and the inevitable suffering it contains, or living a dry life without attachments (which probably isn’t really attainable, though some spiritual groups think it is). This, however, is itself a type of suffering. In other words, to put it bluntly, there is no escape from suffering.

Another double bind: We’re constantly told to do things, though effort, that have no value unless they happen without effort, naturally and spontaneously. You can’t decide love someone. You can’t decide to love God. You either do or you don’t. Love is something that happens spontaneously and naturally. Otherwise, it isn’t really love. You also can’t try to relax, go to sleep, be spontaneous, or be natural. These things either happen or they don’t. But we’ve been told to do these things and we experience a great deal of anxiety in trying to do what can happen, but cannot be accomplished through effort.

Then there is the fact that we are fragile. There are many ways we can be hurt, and without a certain mixture of gases to breathe, a certain temperature range, water and food, etc., we die.

And, of course, there is the fact that all those other people (and there are so many of them) just won’t do what you want them to do (I find this very frustrating, don’t you?).

Face it, life is full of problems, and they never stop. A fan once ran into Tom Hanks in an elevator and gushingly asked him “What’s it like at the top of the heap?” He replied, “Lady, wherever you are on the heap, it’s one thing after another.”

Amen.

Don’t get me wrong. Life is also tremendously beautiful. It isn’t all problems. That’s not what I’m saying. But there isn’t a single person in this world who couldn’t tell you a tale of suffering and challenge. We’ve all been there. And, I can tell you, as I live my 63^rd year, with an increasingly wider perspective of the entire span of life (which no doubt will seem partial to me in ten or twenty years, but is much wider than used to be), I am increasingly aware of the end of my existence coming over the horizon. This makes one, for want of a better word, quite thoughtful.

Some, of course, avoid thinking about any of this, as doing so gives us an uneasy feeling. I certainly didn’t think that much about this sort of thing when I was younger. Somehow, though, all thoughtful humans notice at some point that we’re all stuck in a pretty darned interesting (and often quite uncomfortable) situation.

When we’re young it doesn’t seem that bad, or that real. To the extent that it does seem bad, the young, especially, tend to believe those who say, “Don’t worry, there is a way out. You can find ‘salvation.’” (Keep looking.) Several times in my life I thought I’d “found it”, that I had the solution. It’s meditation! It’s Christianity! It’s not having a religion! It’s wealth! It’s power! It’s love! It’s rationality! It’s A Course in Miracles! It’s healthy eating! It’s Guru Suchabanana! It’s __________! (fill in the blank).

This is usually followed by: “If only other people could realize what I’ve realized! Why can’t they see it?” Always, though, what I thought was salvation eventually turned out to not quite be it.

So what is your current salvation? Have you had others you thought were real but turned to dust?

Something to think about, huh?

One thing I’ve tried to get across in my thirty-five or so years of teaching is that there is no ultimate salvation. There’s no escape from the human condition. The double bind is real. Yes, there are things you can do to make life better. You can mitigate the effects of the bind we’re all in. Ultimately, though, we’re stuck. If you eat right, exercise, meditate, accumulate money or power, be a good person, learn to control your mind, gather a lot of knowledge (plus several other things), yes, your life will be better. But you’ll still be subject to the vicissitudes of the human condition.

If you review centuries of writings of the wisest people in history, you’ll notice that much of it is about this very subject. Most philosophy, knowledge, science, religion, and art is either directly or indirectly about this fix we’re in.

So, what to do?

You may have heard the Zen advice about life: When hungry, eat. When tired, sleep. Or the more famous Zen phrase: Before enlightenment, chop wood and carry water; after enlightenment, chop wood and carry water. (Is this the same as “Eat, drink, and be merry, for tomorrow we die”?)

These Zen masters are describing what they call ordinary mind, a result (partially) of realizing what I’ve described above. We’re caught in the human predicament, so what is there to do but live each day, do what you need to do, attend the needs of your body, and enjoy the ride?

Let me mention one other idea from Zen (I hate to put it that way, as Zen is not about ideas—it’s really my idea, as a result of Zen training—or maybe not enough Zen training). In Zen you do certain spiritual practices (though they don’t call them that) until, hopefully, you see that there is nothing to attain (though they don’t tell you that, and in most cases if you asked they wouldn’t admit that this is what is going on).

What’s more, it doesn’t matter if you know that there’s nothing to attain. Knowing isn’t helpful, any more than knowing about old age is the same as actually being old. You have to be experientially convinced that there’s nothing to attain, in your bones—convinced because you’ve tried EVERTHING, to the point where you really, really get it that there’s nothing to attain. Once that happens, the motivation to keep looking disappears (which isn’t the same as losing your motivation because you’re discouraged, or lazy, or you’re on to the next cool thing that caught your attention).

So, here we are, caught in the human condition—you, me, and everyone else. We’re each doing our best to deal with the dilemma we’re in. Some use this strategy, some use that strategy. Some (most) still think or hope that there’s a way out. Some are strongly convinced there’s a way out—and that they’ve found it.

And, some, like me, think it’s best to do what you can to make things better and to just chop wood and carry water (or make breakfast, go to work). And, of course, love the people in your life.

So, when I mention what’s happening in the human drama—including waves of social mood, positive or negative—to me it IS about spiritual and personal growth because it’s all about navigating our way, through our lives, in THIS world.

Yes, we can talk about enlightenment, getting rid of bad habits, getting the relationship of your dreams, being a success, or what happens when you get to Purification Level 3, etc., etc. Whatever you do, you still have to live in and deal with the real world.

And, quite frankly, I find that a lot of people who are interested in spiritual growth are really trying to escape from the real world, or avoid looking at it—especially when it’s in such a negative state. I understand that impulse, believe me. I DO watch what’s happening in the world, very carefully, in all its corrupt and crappy glory. Keeping an eye on what’s happening, especially as much as I do, requires a strong stomach. It’s very disheartening to see the basest qualities of human beings on full display. But that’s what happens in times of negative social mood.

And, I think it’s going to get a lot worse before it gets better, as I’ve detailed in the previous three posts. In fact, I think a new wave of “worse” is commencing right now after an intervening period of slightly better positive social mood and a slight temporary increase in optimism over the last year.

And, I’m sorry, but I don’t agree that pointing this out creates more negativity. Social mood is a giant world-wide herd-instinct sort of thing. Believe me, if I had that much influence, I would wave my magic wand and change social mood to positive. The mood of society is beyond my control, or yours, and is driven by something much bigger than what you and I think about. I get it, though, that some of you don’t agree. With enough awareness I can create my own mood, and you could create yours, but I am not omnipotent enough to effect the big picture.

Am I being political? Probably. “Political” really means “about the people.” Is the current state of politics distasteful, corrupt, and negative? Yes it is. That’s what happens in times of negative social mood. Do I have a political point of view? Certainly. For the record, I am not in favor of centralized control. I think it robs us of freedom of choice, and ultimately destroys civilization. If you study history this becomes luminously clear.

You may think that if we only had more centralized control, from well-intentioned, good people, we could solve all our problems. You are welcome to your opinion, whatever it is. I see no evidence, however, that this has ever happened, or ever will. Good intentions, when forced on others, have terrible and unintended consequences.

Certain problems are inherent in the human condition. It’s a wonderful hope to think they will be solved. By all means, do whatever you can to make things better. I certainly have and will continue to do so myself. Ultimately, however, the problems of being human can’t be solved, only mitigated. You should be very skeptical of those who tempt you with, “Turn things over to me and everything will be fine.” There is no evidence that this has ever turned out well.

I think it’s important to know what’s happening in the world, as distasteful as it is (at least right now) to look at it, and to prepare yourself as best you can for whatever might happen. That means being prepared mentally, emotionally, and materially. If you lived in Europe in the 1930s, a warning to prepare might have saved your life. I don’t know exactly what is coming, but I don’t think it’s going to be pleasant, and I think it’s going to happen on a scale even larger than what happened in the 1930s and 1940s.

Some of you (probably most of you) would be well-served to learn a bit more about history, so as to see the patterns I’m seeing, and to realize what sorts of things happen at such times.

My purpose, then, is not to be negative, but to be realistic and to be as prepared as possible. Yes, it isn’t pleasant to look certain things in the eye, whether they’re inside you or outside of you. Doing so, however, is the essence of spiritual and personal growth. Ironically, only when you have looked the negative reality in the eye can you truly see the positive, the beauty, and the love all around you.

I hope you’re willing to look—and act. If not, good luck.

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Dear Bill, 

My question is: Why can’t I experience anything spiritual inside that validates, in a positive way, any practice or technique I have ever tried?  Just wanted to show you there is a question to all that follows (because there is a background story that must be told. I’ll keep it as brief as I can though.)

Part of this will be a bit of writing therapy for me as (at 63) my life, both inside and outside, lies in ruins all around me, I’m feeling suicidal, and I feel a need to yell at God.(Sorry, letting whatever happens be OK has run out of steam.)

So…Beginners mind:  In the early seventies I read Zen Flesh Zen bones which blew my socks off and changed me from an atheist who was profoundly disillusioned with life on earth to a rather naive seeker. After reading that book I knew that I had to find a teacher who could guide me to the Self, the God within (my favorite image is simply ‘freedom’ though.)

Tried everything I had access to over the next seven or eight years. No dice; nothing moved me or resonated anywhere but inside my intellect. God didn’t want to know me. Each time something didn’t work I returned to sex, drugs and rock’n’ roll… which did work.

But not good for the body.  Went to the States in 78’ and tried to do a Jack Kerouac…indulge myself into a sort of wandering, quasi spiritual, substance abusing suicide, inspired by my profound disillusion with worldly life and my failed attempts at a spiritual life. 

Almost succeeded but under the most weird and extraordinary circumstances Baba Muktananda reached out into the byways of America and into my abject despair and hauled my sorry ass into Siddha Yoga… where, for the second time in my life, my sox were blown off.

With a return of the enthusiasm of beginners mind I did an Intensive at the end of 79’ and had my first real transcendent encounter with the Self. On the strength of that I was graced with a year of profound personal power where I could — and did – do anything I wanted… with great love and respect.

Glowing with “success” I went to India in 81’ (just to cross the ‘T’s and dot the ‘I’s on my enlightenment process.)  There, the mat of my honeymoon period was slapped from under my feet and I discovered that (to put it mildly) there was still much work to do on my sadhana.

I did not run away though, such was the power of my experience of Kundalini awakening — and the year of ‘home trial’ that followed it — that I was filled with determination to stay the course and do battle with my ignorant demons.

This despite a slowly dawning realization that all the practices (meditation, chanting, selfless service, scriptural study etc.) seemed to be falling on deaf, internal ears. I felt nothing for them.

Not quite true…I felt a steadily rising frustration.  I also realized that a great part of the spiritual journey was about burning up the inner obstacles. This fire, at least, validated that I was moving along the path. Though I tried, however, I failed to find any ‘juice’ in the desert of my inner landscape.

Thirty one years later it’s the same: all fire no joy, no happiness, no freedom… no inner benefits or validation after all my efforts. And on the outside… all of the indications of the failure of what I choose to do with my life… no home, no money, health in decline and a (Siddha Yoga) partner who I love dearly and am completely devoted to, but is worse off than me.  

Ironically Bill, it is spirituality that has made me excruciatingly aware that ‘nothing works for me’. My last hope has failed me. (No, of course that is not true, I have failed it.)

That’s why I added Holosync to my Siddha Yoga practices.  I have stuck to my sadhana through hell and high water. I have spent many years in the ashrams and even done a pilgrimage to Mt Kailas in a thus far vain attempt to get somewhere internally. All of this finds still nailed to the earth and desperate to find that brief experience I had when I first started Siddha Yoga.                                                     

Which brings us to the Now, Bill.  That’s the bare bones above, there is much I could add that is probably relevant, but you’re a busy guy and I’m trying not to waste your time. 

What it seems to me to add up to is that I am missing the most fundamental skills for an internal life.  After 30 years of meditation I can manage maybe five minutes max of internal focus. Though I love music of all sorts thousands of hours of chanting leaves me cold inside. Though I feel respect and admiration for my Guru, I feel no love in my dead heart. Prayer is a complete waste of time (probably because the ear that can hear an answer to prayer is in the heart, and my heart is deaf and dumb.)

The philosophy and literature does inspire me, though — the poet saints, the stories of the masters and strange yogis…your writings, Bill! (and, with your recommendation, Jack Kornfields ‘A Path with a Heart’. Brilliant stuff!)  But that inspiration gets one nowhere unless you have the faculties to translate it all inside…make it work…which I seem frustratingly incapable of doing.  Beginner’s Mind runs out without the validation of some sort of identifiable success. That is the storey of my sadhana – and what was inevitably repeated with the Internal Map course.

So…all fire, no joy. Frustration ranging from tolerable to catatonic. My internal map more powerful than God. My life reflecting all the wasted effort. Is suicide really the only answer, Bill? Is meditation (for some people anyway) just a Pandora’s box of unconscious horrors…best left closed. The way I feel now I really wish I had just stuck to plumbing and drinking wine… money and joy…bingo!

I know this is hypocritical and paradoxical, Bill, but on reading the above, which is all relatively true, I realize that my spiritual life has been full of adventure and amazing learning — on the outside and intellectually. And that I do live in an unbelievable beautiful country, that is moderately safe and sane and I have wonderful friends. I am not unaware of my blessings, Bill. My conundrum is that I am living in heaven but going through hell.

Any clues?

Love and respect, JC

JC,

I’m not sure where to start. You have asked me to assess your entire spiritual path. Though I have profound respect for Muktananda, who was an amazing fellow (I have many close friends who spent time with him), I am not in complete agreement with the Hindu explanation of the human condition or the details of their approach.

I think what you are discovering is fundamental to what Buddhists have discovered about life. One thing we will talk about in the second Life Principles course are Buddha’s Four Noble Truths. The basis of those Four Nobel Truths is this:

As a human being, you are stuck right in the middle of what Buddhists would call “the human condition.” One characteristic of the human condition is that we are caught in a giant matrix of cause and effect – we are at the effect of an almost unlimited number of causes. For instance, there are 7 billion other people, and they often act in a way that causes you to get what you don’t want, or not get what you do want. Most of these people have an agenda that is in conflict with yours, and their actions interfere with you getting what you want.

There are also many physical realities over which you have no control and which can also cause you to experience outcomes you don’t want: the sun, gravity, cosmic rays, weather, the seasons, earthquakes, volcanoes, etc, etc, plus the fact that you’ll die without food, air, water, shelter, a certain temperature range . . . and so forth.
And, finally, even when you get what you want it doesn’t last. Everything in this universe eventually falls apart, goes away, or ends.

All of these conditions create suffering for human beings.

The Hindu view is that if you do certain spiritual practices you have a CHANCE, at least, of attaining moksha (spiritual liberation) – what most Westerners refer to this as “being enlightened” – in other words, having a constant experience of the transcendent (or, as you’ve put it, of God).

Hindus believe that this provides an escape from the suffering inherent in the human condition. Zen, however, has a bit of a different take on this subject. Tozan, a famous Zen master, describes five stages of awakening (The Five Ranks of Tozan). The constant experience of the transcendence (what Hindus call enlightenment) is the third stage, with two more to follow. The fourth stage involves “a fall from grace”, where the seeker realizes that the transcendent, as beautiful as that experience is, is not an escape from the human condition, though at first it seems to be. In fact, in this stage the seeker feels as if he has been thrown out of the transcendent by the very causes of suffering he thought he’d escaped. This is followed (hopefully, with a lot of further spiritual work) by a fifth stage in which the transcendent and relative worlds are integrated – which is quite different than thinking you’ve escaped from the problems of the human condition.

So the cold, hard truth is that, enlightened or not, you’ll still be subject to all the human problems I listed above. There is, in fact, no escape from these problems. Hindu gurus sometimes seem to avoid them because their followers take care of them and make sure their human needs are met, which shields them, to some degree, from some of those problems. But the guru still gets sick and, just like the rest of us, he needs food, air, shelter, etc, to survive, and eventually he grows old and dies. He is still subject to all the problems of being human I listed above (which certainly isn’t an all-inclusive list). He’s perhaps better able to be philosophical about his situation than most people, but he still has to contend with the same problems everyone else has.

Now, as I have said, there are SOME things you can (or, rather, could) have some control over or choice about, because you create those those things. While you don’t create what the sun does, or that you need air to survive, or whether or not there is an earthquake, or the actions political leaders take that affect you, you do create 1) how you feel, 2) how you behave, 3) which people and situations you attract or become attracted to, and 4) what meanings you assign to what happens.

These four things are NOT a choice, however, unless you have the awareness to see how you create them, as you do it. This is what the first Life Principles Integration Process course is about: how you can become aware of how you create these things. When you do that, these four things become a choice.

Making these four things a choice is not something you do in the 6 months the course takes, however. It generally takes decades, and a lot of awareness, which is why we meditate, or, better yet, use Holosync. With Holosync, this process is dramatically accelerated because Holosync creates tremendous awareness.

Once you have a choice about those four things, you can then CHOOSE your suffering – which is a lot different than escaping your suffering, and is, unfortunately, the best you can do in this particular universe. For example, if you are attached to your child, you are subject to suffering if he dies or does something you don’t want him to do. With the choice created through awareness (since awareness creates choice), you KNOW that this consequence (potential suffering) is built into caring about your child, but you do it anyway–you choose to do it–because without such connections, without this sort of engagement in life, life would be dry and boring. It would have no juice.

This is, unfortunately, the best we can do as humans: choose our suffering. Buddha’s first Nobel Truth is that “All life is suffering”—for the reasons I cited above. Your story is your own version of living a life where you, like everyone else, are caught in the human condition.

So, what can you do? First, you can do what you need to do to have choice about those things you actually create. Less than 1% of people ever do this. If you do, it improves your life immeasurably because you stop most of the suffering that YOU are creating. You still have to deal with the suffering you can’t control (a product of cause and effect and the impermanence of all things), but at least you aren’t creating more suffering in the areas where you do (or could) have choice (you will never get to the point where you are so aware that you don’t create some suffering).

Next, you can continue to do spiritual practice toward the idea of experiencing the transcendent, and ultimately gaining the ability to live in the transcendent. You will, after that, at some point experience the fall from grace they speak of in Zen (you may be in that stage right now, based on your email), and which I mentioned above – hopefully followed by the ability to integrate the transcendent with the relative, which, as I said above, is different from thinking you have escaped from the relative world (which is what the Hindu approach promises, but doesn’t deliver). You cannot escape from the relative world, other than by dying, and this integration is an acknowledgement of that reality.

Muktananda, if I remember correctly, died of a heart attack (or some physical problem). So did Yogananda. Just like all humans, he was caught in the human condition. So are you. So am I. So is every person who is reading or listening to this. But what can you do other than make the best of it?

And, of course, there are many beautiful things about being human. You have mentioned the inspiration of philosophy and literature, but there is also music, art, and other creative pursuits; physical activities; the beauty of nature; and, of course, loving others.

I think much of your angst is because you have an idealized view of what is supposed to happen. You believed the Hindu promise of an escape from suffering. I wish there was one, but there isn’t. This doesn’t mean you’ll be constantly suffering (unless you create it), but it does mean that all those things I mentioned above are outside your control, and that you will inevitably fail to get what you want a great deal of the time, sometimes in a big way, sometimes in smaller ways.

This is just the way it is. Though no one ever fully accepts it, you can relax about it, you can learn to have choice about those things you do create, and you can learn to enjoy the day to day breathing in and out that makes us human. Muktananda, in fact, once said, “Life is a meaningless energy, going nowhere for no reason.” He meant, in part, that all of life’s meaning is ADDED, by you. It happens in your mind. This is your creative power as a human. Life means what you decide that it means. But only when you have enough awareness will the adding of meaning be a CHOICE. Without awareness, it will happen automatically, and you will add meanings based on the way your Internal Map of Reality was programmed by your past experiences.

Become aware. Use Holosync. Watch your Internal Map as it creates how you feel, how you behave, which people and situations you attract or become attracted to, and what meanings you assign to what happens.

And, finally, learn to be ordinary, because we all are. In Zen they say, “When hungry, eat. When tired, sleep.” Life is what it is. When you stop fighting against the human condition, it doesn’t haunt you so much.

Be well.

Bill

PS: An update on “Going to Hell in a Handbasket”: I hope you are paying attention and have noticed that much of what I have predicted in my three previous posts—financially, socially, politically, and otherwise—is unfolding, just as I have said it would. And, trust me, this process is just getting started. Social mood will become increasingly darker. Conflicts between all groups will increase. Financial problems will increase. The tendency to seek peace or to compromise will decrease. Please, get out of debt. Accumulate the resources you might need (food, cash, warmth, transportation, etc) should the source of these resources be temporarily shut down. Hope for the best and prepare for the worst. Above all, don’t be a deer in the headlights. Do something.

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Here’s how it started:

Bill,

I really liked the live video chat on facebook. I think it is a much better way for you to communicate information than through writing on this blog (though I still really like this blog). It’s just easier to tell what someone means when you see how they are saying something instead of just the words they are saying. Definitely do more video chats!

I have an economics question for you if you feel like taking the time. Harry Browne brings up an example in his book about the more expensive cost of using recycled paper vs. new paper. Browne explains this means that the resources consumed in recycling paper are more valuable to the market than the resources consumed in making new paper (aka trees). So basically the market should go with new paper since trees are less valuable than all the things that go into recycling paper.

What I struggle to understand is how you can judge the value of trees solely by their price in the market. Say we discovered that cutting down trees significantly affected oxygen levels that were unhealthy for people. How would the free market naturally account for this to make trees more valuable?

To me it seems regulations making trees more expensive would be the only way, yet I know this undermines the whole concept of the free market.

Sorry for the long question, but I had to ask it because this has been burning on my mind, as I’m really interested in understanding the libertarian viewpoint.

FROM BILL: First of all, you are assuming that what the green people say is true, that trees are disappearing. This is far from true. I don’t have the stats right in front of me, but (and this is a result of the market, too, as a matter of fact) timber companies plant more trees than they cut, and have for a long time. It’s in their interest to do so. The only place this isn’t true is in the Amazon, where socialists and other central planners are in control. This is the real reason why the trees in the Amazon are disappearing.

It was BEFORE capitalism (or, as I said, in places where resources are controlled by central planners) that people—including tribal people like the Mayans, Aztecs, etc., but also including Europeans, Asians, etc—would cut down all the trees in a certain place for one reason or another, until they were all gone, and then move on to another spot and do it again. Modern people in a capitalist society have a vested interest in maintaining and husbanding resources, and they do. So, first of all, we are not running out of trees. Not by a longshot.

The question about how the value of something is determined is an important one. Here is the answer: people determine the value of each commodity, service, item, or whatever, by their willingness to part with resources to have it. When you have resources of some kind, and you want something else, you do what everyone else does: you decide if you want to hang onto your current resources (which is often money, but could be other things, or even time) or trade it for something else. In other words, what is the item in question worth to you? How much of your resources are you willing to part with to have it?

If you don’t think something is valuable enough to trade resources for, it must not be that valuable–to you. Billions of collective decisions about what is valuable, and how valuable, determine the value of items–at least in a market economy. In a command economy, with central planning, someone else decides for you what you should want, and how much you should want it and therefore pay for it (whether in money, other resources, time, or something else).

This is highly inefficient and a huge waste to a society. And, it’s one of the reasons why command economies are seen as lacking in freedom–you have less freedom of choice in such a society. It’s also why the Soviet Union was famous for long lines of consumers waiting to get a little bit of toilet paper, meat, shoes, or whatever. In a command economy, shortages and rationing are common.

Not only is it impossible for central planners to forecast what or how much people want in the efficient way this is accomplished in a market economy, there is no way for shortages to cause prices to rise, which causes entrepreneurs to say to themselves, “Ah, I should make more of this,” or for surpluses to cause the same entrepreneurs to produce less. In this way the prices and amount of goods fluctuates around an equilibrium point, and whenever it is out of balance natural forces bring it back into balance.

In the example Harry Browne gives, he is right (I’ve seen the studies). For most things, more resources are used to recycle than are saved by the recycling (not in all situations, though–in a few cases recycling saves resources). Plus, as I said above, trees are a sustainable and renewable resource, and timber companies are quite successfully increasing the number of trees, despite what the Al Gore’s of the world say. It would be stupid of them not to.

Only in a centralized economy, where central planners try to call the shots, would a society end up using more resources than necessary. In a market economy, where each individual is making his or her own decisions based on the best way to allocate their own scarce resources (including money), the collective decisions of all the people sort these sorts of things out in the best way. Though some people make bad decisions and waste things, overall people are smart enough to make the right decisions–or to learn from their mistakes when they make bad ones.

Central planners, though, do not have the same immediate feedback that you have about your own situation. They are flying blind, so to speak—or, they have a political agenda, or are acting at the behest of some special interest group. In other words, they are corrupt. Central planning is legendary for producing the conditions for corruption—another huge waste to society.

Central planners make decisions based on what they think you should want (or, based on some corrupt agenda they have). They are not particularly concerned with what you really value.

The government takes a lot of money from you in taxes (unless you’re one of the 47%—in the US, at least—who pays no taxes). How often does the government spend the money they take from you on what you actually want or what you would spend it on if you still had it? It would probably be a complete accident if they spent any of it on what you would buy with it. Multiply this spending on what you would never buy, or what is your 525^th choice of what to buy, by millions of people and you have huge allocations of resources to things that people don’t want.

This is incredibly wasteful to a society, and to the degree this happens, people suffer. In the socialist societies where this happens the most—China, Russia, Venezuela, North Korea, etc—the suffering is obvious. Look at what is happening in Greece right now as another example of central planning gone wild. Or, for that matter, most of Euope.

What’s more, you have a strong vested interest in using your resources wisely. Central planners are allocating someone else’s resources. They don’t care about them the way you do. That’s why there is such a huge (HUGE) amount of waste in government.

The value of an item is determined by the person who is deciding whether or not to trade resources for it. The more he values the item, the more he will give up to have it. What other possible method of valuing things would work well? Should the subjective view of some OTHER person (one who often has a personal—and corrupt—interest in the matter) determine whether you should pay a certain amount for something?

Finally, you say that trees becoming more expensive undermines the free market. Not so. Trees would be more expensive if people wanted them (including the products made from them) more, less expensive if people valued them less. In such a case their value would be bid up. And, seeing this, timber companies would be motivated to plant even more of them. This is exactly how a market economy allocates resources.

Those who want something more, or need it more than others, are willing to pay more for it if or when it become scarce (which motivates someone to create more of it). Those who don’t want to pay more, or can’t pay more, shift to using other products, materials, etc. In the case of trees, those who can’t afford them might use bricks, perhaps, or something else.

When something becomes more scarce, its price goes up, and entrepreneurs are motivated to create more of it. If too much is created, prices go down and entrepreneurs are motivated to stop creating so much of it. This is a pretty slick system (and totally natural and needing no regulation to work)—a system that results in prices reaching a level in every case that works best–certainly better than any central planner could create.

When central planners screw with prices–as they did, for instance, with oil price caps in the 1970s–it creates artificial shortages (the motivation to create more because the price goes up is gone). This created gas rationing in the 1970s, with people lining up around the block to buy gas, and only being able to by on alternating days. As soon as they removed the price fixing, the problem disappeared. This is the same mechanism that caused the lines in the Soviet Union.

FROM BRIAN:

Thanks for that response Bill, that helps a lot. I wasn’t saying I think cutting down trees is depleting our oxygen, I was just saying it hypothetically. If such a thing was proved to be true (even though it certainly isn’t), then would the price of trees go up in a free market? I don’t understand how it would since in a free market price is determined solely by supply and demand. Yet it would be in society’s best interest for it to go up, right? In such a case it seems there is a disconnect between the price of something and its true value. That’s what I don’t get, but I have a feeling I’m missing something…

FROM BILL: But value isn’t some intrinsic thing. It’s determined by the person who is exchanging resources for the item. You’re assuming that if trees do X, that’s a sign of value. It might be, and it might not be. It depends on who’s buying.

Consider this. When I was growing up, the air and water were filthy. Now they aren’t (despite what Al Gore says)–except in socialist countries, ironically, where central planning is king. This happened because people discovered that the air was dirty, didn’t like it, and began to patronize those who didn’t make it dirtier. The government tried to make it look like they made everything cleaner, but they really didn’t.

If you think the air is cleaner because of the government (and that the market couldn’t possible keep it clean), you are mistaken. The government may have rules about these things, but they don’t/can’t enforce them, except with a few people (anymore than they can keep people from smoking pot, or keep burglars from breaking into houses). They don’t have enough regulators to do it. The same is true with food laws, financial laws, and so forth.

And, the whole government regulations thing is crooked, anyway. If someone who is their buddy violates the laws, they put on a big show of doing something, but ultimately give them pass. The air is mostly clean, the food is mostly disease free, the restaurants are mostly clean, and the workplaces are mostly safe because people demand it, and because it’s in the best interest of the owners of the companies, and the market complies.

Yes, there are some companies that stupidly don’t maintain a safe workplace, or who pollute, or who don’t maintain food safety, or whatever. The market weeds these people out eventually. Yes, they are a problem while they exist. You can see, though, that they exist despite all the government regulations. The regulations do not solve this problem.

There is no way, however, to make everything perfect. It is impossible. Since the government wants power (over you), anything that goes wrong is an excuse to add more laws and regulations. It’s like the TSA. Does it make it safer to fly because they scan everyone and do these invasive pat-downs? I don’t think so. It just makes a lot of people THINK it’s safer. People get through the screening with weapons all the time—often just to show it can be done.

I suppose if no one knew that trees create oxygen (and enough of them were disappearing that it really was a problem, which isn’t even REMOTELY close to being true) it might be possible that the trees could disappear and we’d all die. But if people knew that it was happening, and didn’t like it (ie, they valued the trees), the market (not the government, which doesn’t have the horsepower to do it anyway) would make it stop. In fact, though, the government is telling us that there is too much CO2, most of which is made by trees!

Bill,

Why does regulation make everything worse? (food, air ,water ,workplace etc) I can see how regulations are a waste and how they are ineffective but I dont see why they make everything worst than it was before.(I mean the specific thing that is regulated).

Carlos

FROM BILL: a) Regulations don’t solve the problem they are supposed to solve; b) they cause many unintended consequences, many of which are wasteful, harmful, and expensive, c) they increase the cost of everything because they require a huge government bureaucracy and because business owners must spend a lot of money to comply with regulations; d) they reduce the choices of consumers; and e) they reduce the overall level of freedom in a society.

I’m not saying there shouldn’t be any laws about these sorts of things. However, the idea that government regulations, of any kind, have ever solved the problem they were designed to solve, is just not true. So you have a non-solution, with many serious and negative side-effects. Probably 98% of businesses act in a responsible way because it’s in their interest to do so. The 2% that aren’t responsible would still be irresponsible with or without the regulations.

Yes, it should be against the law to pour sewage in the river. However, the regulations around such things DO NOT prevent the few who would do this from doing it, and they have many negative consequences.

FROM GLORIA THE SUPER-LEFTIST:

“I don’t have the stats right in front of me, but (and this is a result of the market, too, as a matter of fact) there are many times more trees in the world today than ever before.”

Of all the rocking horse manure you’ve spouted so far, this takes the prize! You of all people know that statistics can be doctored to prove anything. If it wasn’t so irresponsible to be telling gullible people who look up to you nonsense like this it would be laughable.

No doubt I am inviting one of the characteristic vitriolic replies that you seem to enjoy targeting your critics with but I couldn’t care less. Your credibility rating has finally bottomed out as far as I am concerned.

FROM BILL: Why, then, do you keep hanging around, if I’m spewing so much manure and I have no credibility? Perhaps you are a masochist, and you just love to hear all my lies and misinformation? Were you anticipating as vitriolic a response as, for instance, my characterizing what you’ve said as “rocking horse manure?” Or would that be over the line so far as “vitriolic” is concerned? At least your posts are characterized by civility and the avoidance of vitriol. Thank goodness!

As a matter of fact, the number of trees in the world IS much higher than it was several decades ago. The one exception is probably the Amazonian rain forest, which is unfortunately under the control of South American socialists who don’t care about the environment. Tell me–if you owned a forestry company, would you just cut down all the trees, or would you make sure you were planting enough to keep your industry in business?

If anyone is falsifying statistics it is the green types. They’ve now been caught with their pants down lying about climate change, just as they were caught lying about the number of homeless people a few years ago, the number of poor people, and anything else that would help their “let’s put the government in change of everything in your life” cause. I’m sure you can go to any number of progressive-run websites and find all kinds of statistics that we’re down to our last 17 trees.

FROM KEN:

Re: Number of trees

I found one of the largest, recent studies on this topic from the Sunday Times of London. Link below. The bottom line is that the number of trees is increasing in all industrialized countries but falling in the Amazon area, just like Bill said. The net number of trees, including the Amazon, fell 2.5% from 1990-2006.

Two points. The study was done in 2006 and this is 2011. The net number of trees including the Amazon has likely gone up by 2010 by extrapolating the data. China has planted massive numbers of trees over the last decade which was not fully on-line for this study.

I could not find another more recent study of this depth and scale. But even using this 2006 study, the US tree population has increased from 1990-2006, contrary to the deforestation theories.

It’s ok to use a lot of trees as long as you plant as much or more. The key is to study tree “density” using satellite photos rather than tree “acreage”. Tree acreage has decreased due to efficiencies while tree density has increased. Tree density = tree count. Tree acreage = propaganda count.

Personally, I do not waste resources, I recycle, use efficient light bulbs, bought a residence close enough to allow me to walk to work (using zero gallons of gas during the week, except for date nights), etc. But even though I might appear on board with the green crowd, and I am in some ways, I want the truth. I want reality. And when I’m lied to or, let’s just say, mislead enough, as with the global warming cadre, they have zero credibility in my eyes. I try to live my life ethically. But based on reality—at least, as near as I can determine it.

http://www.timesonline.co.uk/tol/news/world/article637004.ece

FROM BILL: What bothers me is that I was able to find many websites giving supposed data showing that we’re down to our last two trees, etc. Very offical looking, etc. I’ve seen enough Green propoganda, however, to spot this sort of thing. Thanks for finding the London Times survey. Gloria? Are you out there? Oh, wait. You aren’t looking for the facts. Never mind.

***

FINAL NOTE ABOUT SOCIAL MOOD: It’s been more than seven months since I first posted information about social mood turning negative and described many of the things that were likely to happen as a result. I invite you to review what I said and notice that it’s all happening. Please review Part 3 and prepare for the future. We are entering a long period where what was spent (on credit) must be repaid. This repayment will either be by the borrower or by the lender but, either way, it will happen.

This is called deleveraging. It is also called deflation. It means that the whole world will live at a lower standard of living for quite some time.

In my opinion, Holosync will be a life-saver during this time. Holosync raises your threshold for stress, making you more resilient, and the coming years, I suspect, are going to be quite stressful. Holosync is cheap mental health and well-being insurance. Use your Holosync!

Until next time, be well.

Bill

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***

Well, we’ve all been through a lot as we’ve discussed and argued about social mood. This topic has obviously struck a chord. You’ve sensed that something is wrong, and I presented one possible explanation of why you’ve felt that way.

Of course, some of you were already quite aware of all of this. 

And, some of you think I’m full of it. I wish you luck. Hopefully your refusal to see what seems obvious to a great many people won’t come back to bite you. Those of you who have magical solutions, good luck to you, too. Let me know how that works out. I’ve found some of the more bizarre ideas highly entertaining.

And though I didn’t set out to make this a political discussion, a lot of politics ended up coming out. To those of you who think it’s just great that the people in charge want to continue the process of centrally controlling and regulating everything under the sun, redistributing wealth, getting rid of fossil fuels, and so forth will, I suspect you won’t be so supportive once the consequences of these things begin to affect you personally, as these changes will affect you in ways you will not like. 

Over the last year (and before I ever brought up the idea of social mood) I’ve been discussing something that is basic to the human experience, but often denied: that we have little or no control over many aspects of the human condition.

(If you’re new, consider reading these posts: The Human Condition, Don’t Know Where It Came From, my series on Seeing Things the Way They Really Are—there are others.)

This lack of control was perhaps less obvious during the recent period of extremely positive social mood (which topped in about 2000), and also because in wealthy countries many human problems are less severe. Now that social mood is turning negative, this lack of control will become more obvious. 

Many have asked me what to do to be more prepared. Unfortunately, there is no way to be totally prepared for everything that could happen. Asking me for solutions is a bit like asking, “What do we do now?” when your car has already driven off the cliff. There certainly are ways to be more prepared for what is to come, but many situations in life have no magic solution, and this is certainly one of them. 

So, take my ideas for what they are: the best I can come up with in a difficult situation based on limited information. I certainly don’t claim to have all the answers, or even the best answers. I’m just someone with his ear to the ground, and who is reasonably intelligent and pretty good at synthesizing information—and, who happens to care what happens to you. Ultimately, though, you need to be self-reliant enough to do your own research and come to your own conclusions. 

Unless you’re over 70, you’ve probably never experienced society-wide hard times. Because of the good times we’ve lived in, we’ve come to expect that all problems have a solution and that everything generally ends well. The truth is that sometimes things end well and sometimes they don’t. Ask those who lived in Europe in the 1930s and 1940s.

 And, please don’t misunderstand me. I’m not saying that all is lost. You DO have some influence over how things turn out for you.

Some people, when they realize what I’ve said about the human condition is accurate (that there are many things over which we have no control, and that everything is impermanent) become depressed or disheartened. Society dresses up much of human experience so as to mask those things that are difficult to acknowledge. If we discover that these fairy tales are untrue, it can be quite a shock.

All is not lost, however. There are four things you do have a choice about—IF you are aware enough to see how you create them:

 1) How you feel…

 2) How you behave…

 3) Which people and situations you attract or become attracted to, and…

 4) What meaning you assign to whatever happens.

Right now, unless you can see how you create your reaction to world events, you’ll probably assume, as most people do, that the events themselves create your reaction. In that case, the events happening these days will trigger you to create unpleasant emotions. Based on those emotions, you may behave in ways that don’t serve you, attract or become attracted to people and situations that do not serve you, and assign non-resourceful meanings to what happens.

My goal in presenting this information about social mood was not to talk about Obama or Glenn Beck or in any other way to start a political discussion. I brought it up to help you become more aware of how you create your response to social mood and get swept up in it. This awareness will allow you, to a certain extent, to avoid falling in step with the prevailing social mood. If you’re aware of your own impulses to feel hopeless, or angry, or some other unpleasant emotion, you’ll be better able to remain independent of social mood. Awareness creates choice.

Though this is easier said than done, my first suggestion is to be realistic about the way things are. Life is what it is. It has moments of joy and anguish. Someone will always be in power and will take advantage of others. Others will strive to be kind and to alleviate the suffering of others. There always will be wars and conflict. Many things will always be “unfair.” Sometimes the innocent will suffer and the undeserving will benefit. Random acts will happen; some will be tragic and some will be wonderful.

 If you believe that things “should be fair,” you’re putting yourself in a double bind, fighting a fight you have no chance of winning. Things have never been fair, and never will be. You can decide to be fair, but you can’t count on others to do the same, and you can’t count on the physical forces of the universe to “be fair.” That’s just a fact of life.

And, things aren’t all bad. There are many awe-inspiring things about life: Great music, films, dance, fiction, and other arts. There are people to love and care for and interesting things to do and learn. There are exciting challenges to be met. There are full moons on summer nights, star-filled skies, stunning waterfalls, gorgeous music, amazing athletic feats, beautiful women, handsome men, touching moments with friends, and laughing children.

Life is just life. You, though, are in charge of what it means, how you feel about it, and what you do with it. Though many people and situations randomly cross your path, in most cases you are in charge of which people you interact with, and which situations you end up in.

The key to all of this is awareness. If you’re unaware, you’ll create much of your life on automatic pilot, outside your awareness, based partly on how your nervous system was programmed during your early years and partly on your automatic response to the mood of the crowd.

To the degree that you’re aware, the meanings, feelings, actions, and the people and situations you attract become a choice. Once you have a choice you’ll always choose what serves you. It doesn’t serve you to feel hopeless. If you feel hopeless, a non-aware part of you is calling the shots. As such, you’re more susceptible to the mood of the herd.

So work on becoming more aware. Please, faithfully use your Holosync. Make it a part of your routine, like brushing your teeth. Though you aren’t in charge of a lot of what happens, you are in charge of what the world means, because that comes from you.

If you focus on all the dreary things in the world, and add hopeless meanings to them, you’ll feel hopeless. Instead, acknowledge that life is what it is and let go of wanting it to be perfect (even while you work to make it better). Focus on how you can help, what you can learn, what you can experience, and who you can love. If you do that, you’ll feel good most of the time.

I don’t think it’s possible to completely step out of the prevailing social mood, but you can step out of it to some extent. When social mood is negative the amount of suffering in the world increases. In such times human beings treat each other even more badly than in times of positive social mood.

You don’t need to participate in negative social mood—though without enough awareness you’ll be tempted to.

So, first and foremost, become more aware.

Here are some other ideas:

Become as knowledgeable as possible about what’s really going on: Given all the competing information, some of which is quite biased, this isn’t easy. What’s more, you might not have the motivation to become well-informed. Plus, the situation is always changing, so staying informed is an ongoing process. You have to enjoy finding, evaluating, and absorbing information about the world. These are historic times. Become interested.

Be as objective as possible. Don’t just look for more information to confirm what you already believe (and don’t think, “Oh, I’m not doing that,” because you probably are). Purposely expose yourself to information that expresses a different point of view.

You’ll need criteria that allow you to evaluate the information you find. I’ve spent decades reading information about history, science, philosophy, political science, the financial markets, human psychology, and many other subjects. This, along with personal experience, becomes part of my criteria.

For instance, I spent my younger years ardently studying Marxism and other leftwing approaches, which at the time seemed very compelling. As a result, I know what such people think, why they think it, what they want, why they want it, and their strategy for getting it. I also know, from studying history and from talking to people who have lived under socialism, what grim results these approaches create.

Some of you think you have good criteria, but your posts reveal that you’re missing many parts of what you need to know. I’m not saying that my criteria are perfect, but they are based on a lot of study, and a real desire to find out the truth, and I still spend several hours a day studying and researching these subjects.

You can also rely on experts who sift through a lot of information and make it available to you. Finding which people provide good information, though, takes time. You often have to follow someone for months or years and see their track record before you can tell. There are no shortcuts.

Some questions I hope you will ask yourself:

Do you really understand how the financial system works? Do you understand how a free market REALLY works? Do you understand the difference between a free market economy and the type of economy that exists in Western countries today? (What we have now isn’t a free market.)

Do you understand fascism and how it works? How a republic works? How socialism really works? Could you identify each of these systems by their characteristics, actions, and outcomes? Do you know the pros and cons of each? Or did everything you know about any of these come from someone who is a biased proponent or opponent of it?

Without understanding the above, how can you evaluate what the proponents of each are saying, and how the proposed actions of your government will affect you?

Do you understand how the political process works, not just in your own country, but in other societies? Do you understand how these processes have evolved and changed over many centuries, so that you understand why things are the way they are now? Do you understand the US Constitution (or the founding document of your own country) and why it was framed in a certain way? Much of this is no longer taught in schools in the US, so that most people under 50 don’t know very much about it. What they have been taught is often biased.

Do you understand the historical conflicts that come to a head during times of negative social mood?

Do you understand the developmental stages societies move through (as described in Spiral Dynamics, for instance) and where different countries are in that developmental process? Do you understand how a society’s developmental level affects that country’s motives and actions?

If not, how can you evaluate what is happening in the world?

Do you understand how the laws of nature work? Can you tell when something is proposed or assumed that isn’t possible given those laws? Are you up on what science knows about how the world works, or are you scientifically illiterate?

If so, you have no real and clear criteria for evaluating many things that other people say.

Do you have an understanding of human psychology and what motivates human behavior, including an individual’s developmental level? If not, you’re at a disadvantage in dealing with people, and in evaluating potential leaders, their motives, and their proposals.

It’s understandable that most people don’t have a lot of accurate criteria in these areas. It takes a lot of time to understand these things. If you don’t have this education, be willing to admit it. Don’t make pronouncements about something you don’t know much about—or believe what someone else says just because they sound confident about it.

Get out of debt now and begin to save some money, even if it means cutting way back on what you usually spend. Being in debt is going to be dangerous in the next few years. And I mean DANGEROUS. In fact, being owed money will also be dangerous, because many people won’t be able to pay.

Have some resources “outside the system” (ie, not in a bank, perhaps even not in your country). The degree to which you do this depends on how many resources you have.

Consider having 3-6 months of stored food and water and other necessities, just in case. Have a way to get around if it comes to a point where you can’t drive. Figure out what you’ll do if public services temporarily break down or are rationed.

Personally, I would own some gold.

Consider going to Everbank.com and setting up an account in Swiss Francs, as it is probably the strongest and most stable currency right now. Dollars have lost about 20% of their purchasing power since 2000. That trend will probably continue. If you decide do this, though, be willing to have some criteria about when to switch back into your own currency, or to some other currency, or out of all currencies and into gold. Things are always changing. No investment goes up (or down) forever.

If you don’t pay attention and develop the ability to respond with intelligence to what happens, financially and in other ways, you have no one to blame but yourself. Learn something about how these markets change and be willing to watch them. If you aren’t willing to do this, stay out of them.

Get to know your neighbors. Enlarge your circle of friends. Create or enlarge your support circle. We’re going to need each other in the coming years.

Make a list of all the free things you can do that are enjoyable and are good for your soul, cost little or nothing, and don’t involve fancy electronic devices: reading, spending time with family or friends, listening to or making music, building or repairing things, taking walks, playing with children, making love, playing sports, watching the clouds float by, exploring your city or neighborhood on foot, etc., etc.

Look for ways to serve others. Many will need various kinds of help in the coming years. What could you do to provide it? Think beyond your own needs. Doing so will make you happier.

Be willing to be a leader. Be willing to sacrifice for others even when the prevailing thinking is: “It’s every person for him (or her) self.”

Become as self-reliant as possible—intellectually, physically, and psychologically. Looking to the government or other elites to take care of you puts you in their power, and believe me, that’s what they’re hoping for. Strive to rely on yourself and to be as free as possible. Be sure to read How I Found Freedom in an Unfree World, by Harry Browne. It will change your life.

While you’re being self reliant, also be open to intimacy and connection with others. Self-reliance doesn’t mean isolation.

Be one of the people in the world who, regardless of what happens, continues to be loving and compassionate. Be part of the solution. Care, and show it.

I see myself as a synthesizer and communicator of ideas, and someone who does his small part to alleviate the suffering of others. What is your role?

***

Appendix: Information Resources

I’ve been asked for a list of information resources. Some of these are free and on the internet and other cost money—in some cases, quite a bit of money.

This is of course a partial list. And, there’s more to this than just getting “accurate” information. I also learn from the inaccurate information I read or see (what certain people are saying in order to create a certain perception or to further their own ends, for instance).

I read many financial newsletters by people who keep subscribers to the degree that what they say turns out to be accurate. Though ALL humans are biased in some way (or at least have a limited perspective), I find that these people are at least doing their best to find out what is really going on, rather than promoting a certain political or cultural point of view (though they often have one).

Here are some of the things I read (some of which are not completely unbiased–some things I read because I want to see what information the mainstream is receiving–I read it knowing that it is biased):

From Robert Prechter and the Elliott Wave people (www.elliottwave.com) :
The Socionomist (newsletter about social mood)
The Elliott Wave Theorist
The Elliott Wave Financial Forecast
Elliott Wave European Financial Forecast
Elliot Wave Asian-Pacific Financial Forecast
Elliott Wave Global Market Perspective
Also check out Robert Prechter’s books, especially Conquering the Crash

The Aden Forecast www.adenforecast.com

Decision Point www.decisionpoint.com

Dow Theory Letters written by Richard Russell (this is my very favorite source of financial information) www.dowtheoryletters.com

Check out Doug Casey (www.caseyresearch.com) Very well respected.

John Mauldin (google him–free newsletter read by over one million people) www.johnmauldin.com

Wellington Letter (Bert Dohmen–very good, pretty expensive) http://www.dohmencapital.com/index.htm

Anything by Martin Weiss. He is an investment advisor and comentator on the economy (some of his stuff is free, very good)

Stratfor (A service providing high-level geopolitical intelligence and analysis—in case you want an objective view of what’s happening in the world, what the different issues are between countries, regions, ethnic groups, etc., the interests, opinions, and motivations of each group, and so forth. All the news agencies use Stratfor, as do many multinational corporations and governments. This is pretty much “just the facts, ma’am.) www.stratfor.com  Some of their stuff is free.

The Daily Reckoning (free)

The Economist (best weekly news magazine in the world, though it has its biases)

I watch a lot of TV news, though I am aware that what they show is selective. I find that Fox, contrary to what many people have been led to believe, is actually the least biased and the most likely to show both sides of an issue. I make my own interpretations of events, though, rather than adopting the interpretation of TV commentators. As I’ve said, I like Glenn Beck. Try watching him. See if you don’t like him, too, and find that he isn’t at all what you’ve been led to believe. You might not agree with him, or like some of what he says, but he isn’t lying, as many people on the left claim.

I also read the Wall Street Journal and USA Today. USA Today is a good barometer of what the masses are being told. It is quite biased, both in what content to present and in how it is presented. I find that Time Magazine and Newsweek are mostly garbage, but they do give you an idea about what the general population finds interesting.

The New York Times is a good source, though they are extremely liberally biased. If you want to know what mainstream liberals and progressives are thinking, this is your source.

The books of F.A. Hayek are great (read The Road to Serfdom), as are books of Harry Browne (especially How I Found Freedom in an Unfree World, which is one of the most important books I’ve ever read), and Ludwig von Mises (not easy reading, though). Von Mises’ Human Action is a masterpiece.

Thomas Sowell’s book are extremely good, especially those about economics. They are easy to understand and will really open your eyes. Google him and you’ll find hundreds of his newspaper columns, which are bite-sized morsels of wisdom and rationality. If you really want to go more deeply into economics, read Hayak and Ludwig von Mises.

Will and Ariel Durant wrote a multi-volume history of the world (The Story of History) which will take you years to read, but is worth it if you want to understand history.

The books of Barbara Tuchman (historian) are fantastic. Also Arnold Toynbee (major historian).

The Rise and Fall of the Third Reich by William Shirer is fascinating, and you will see uncomfortable parallels to things happening today.

Consider reading up on the history of the labor movement, the works of Mao Tse-Tung (or however they spell it these days) or works about him. Learn something about Lenin, Marx, the Fabian socialists, the early 20^th century progressives, and other related topics. Wikipedia is a good source.

It’s also quite instructive to read up on the history of the Roman Republic and the Roman Empire. The Decline and Fall of the Roman Empire, by Gibbon, is well worth reading. Read about the history of Islam, given the role Islam is playing in today’s world.

For a broad scientific education for a lay person I suggest the non-fiction books by Isaac Asimov, which are fascinating and easy to understand. Though he is a science fiction writer, his books about science are fantastic.

Books by Steven Pinker are fantastic for info about the mind (How the Mind Works, The Blank Slate, The Language Instinct, The Stuff of Thought, etc).

It is also important to know something about psychology, systems theory, and human development.

I also read a lot of books written by top scientists for the well-educated non-scientist. I subscribe to several science magazines. I am also quite well-read in all the literature about Eastern philosophy (Buddhism, Hinduism, Taoism, Sufism, etc), and its western off-shoots (New Thought, Theosophy, Alice Bailey, etc.)

I highly recommend Why the West Rules–For Now, by Ian Morris. This recently published book gives the latest info from archeology, sociology, and history about the entire sweep of human history from the earliest evidence of human beings up to today. Morris’s writing and storytelling is witty and engaging.

Go to Amazon. Browse. Read the reviews. Use Wikapedia to read about some of these subjects.

I could go on and on, but this gives you a few ideas (in fact, a lifetime of ideas, and I’m leaving out many categories and many good sources in those I’ve mentioned). I realize that to do all of this probably seems like an impossible undertaking. Be relaxed about it. Start with one or two things and see where it takes you. Do it because it’s fun to learn.

Above all, become more aware, and strive to be kind to people.

Be well.

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“Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one.” –Charles Mackay in Extraordinary Popular Delusions & the Madness of Crowds

Wow. Worms everywhere. A sea of worms. A huge can of them.

What have I gotten myself into?

Before I get into the main topic of what was to be this final chapter of this series (but isn’t), I want to make a few comments about what has transpired with the first two parts.

My description of social mood turning negative, and what kinds of things are likely to happen (and, historically have happened) obviously really struck a nerve. Though we’ve had a certain amount of acrimony on this blog from time to time from a certain few people, these posts really amped things up.

This has happened, I think, because this topic really hits home–and because we’re in a time of declining social mood, which is affecting you, too. There’s nothing theoretical about it. It would be difficult to not notice the negativity, chaos, anger, fear, and uncertainty in the air. Some are living right in the middle of it.

In the space of a very short time we have had a shooting of a Congresswoman and a Federal judge (and several others) in Arizona; union protests in Wisconsin (and several neighboring states); the Japanese earthquake, tsunami, and nuclear problems; the Egyptian situation, the Libyan situation, similar problems in other Middle Eastern countries, a gruesome killing of a family (including small children) by terrorists in the Gaza Strip; just to name a few.

We also have economic/debt problems all over the world, rising prices, unemployment, record gold and silver prices…and all the various examples of political acrimony, most of it rather ugly and contentious. In fact, I could go on and on reporting various grim news items (but won’t).

I found the different types of responses my description of social mood elicited quite interesting.

Some of you are in denial. It’s not happening. The Age of Aquarius is coming. More and more people are becoming enlightened. We’re on the verge of a New World. It’s going to be fantastic. All our needs will be met and everyone will get along. Utopia is nigh.

Several of you wanted to nitpicking the details, as if doing that would mean all of this isn’t happening. Well, there may be several “wrong” details in the socionomic hypothesis, especially when you look at the most minor details. Does that invalidate the main point I was making, though? My main point went zooming over the heads of some of you.

There are several logical fallacies people use when faced with something they don’t like but don’t have data or information to refute it.

One is the Ad homimem attack. Ad hominem means “against the man” or “against the person.” In this fallacy an argument is rejected on the basis of some irrelevant and generally negative charge (whether true or not) about the person making the argument. Ad hominem attacks are fallacious because the character, circumstances, or actions of a person rarely have any bearing on the truth or falsity of the claim being made. (However, “You don’t know anything about this subject” is not an Ad hominem attack, if true.)

Another fallacy is “setting up straw men and knocking them down.” In the Straw Man fallacy the actual argument is ignored and instead the person argues against a distorted, exaggerated, or misrepresented version. Distorting and then attacking the distorted version of a position, however, does nothing to refute the actual argument.

Dozens of responses utilized this form of attack. Many people shot from the hip without knowing what they were talking about. Instead of framing their post by asking a question, or saying, “What you’re saying contradicts something I’ve always thought was true…” the person made assumptions about or otherwise twisted what I am saying, and then argued, in effect, against their own assumptions.

And, some of you just called names. I was accused, for instance, of hating Muslims because I mentioned the Muslim Brotherhood and their desire to reestablish a Muslim caliphate (something that isn’t disputable—they say so themselves, and so do the Iranians, and I’ve seen many videos of them saying it and have read transcripts of speeches where they have said it and have seen passages in books where they say it).

Quite frankly, I haven’t been accused of so many things since…well, let’s just say it involved an ex-wife. I’m negative. I’m saying the world is coming to an end. I’m saying we should all give up.  I hate Muslims.

But I didn’t say any of these things. These are assumptions made about or conclusions drawn from other things I did say. They are reflections of the ideas of the accuser, not of anything I said.

As I said in my answers to several posts, I am against groups, whether religious, political, or otherwise, who want to control or force others to live in a way THEY think is best or proper, or who are otherwise causing suffering to others. I don’t think an elite group should tell you what you can eat, say, buy, or do (unless what you’re doing involves stealing what others have rightly earned or physically injuring others).

I don’t care what group it is, if they advocate or carry out such actions, I’m against it. To twist that into the accusation that I hate a certain group is a long-standing tactic of demogogues. This an Ad hominem attack in its worst form—an intellectually lazy tactic used by people who have no real facts or counter-argument.

Some of you have a bad case of what I call NAD (New Ager’s Disease). You have disowned the negative aspects of being human—you’re negative about negativity. This causes negativity to become a shadow, and like all shadows, you express it by being negative yourself, though you don’t see it. Everyone else does, though. Human beings are both positive AND negative, no matter who they are. If you think you’re never negative, or that negativity can be gotten rid of, you’re deluded.

In fact, I never said that anyone should be negative about what is happening. I said you should be REALISTIC about it. But if you have an issue with negativity, you will hear this as being negative, without realizing that this is an interpretation you’re making, not one I made.

Believe me, I’m very familiar with the whole idea of “As a man thinketh”. However, your thinking can only influence how you feel, how you behave, which people and situations you attract or become attracted to, and what meanings you assign to what happens. Material facts are not changed by your thinking, unless that thinking is accompanied by action, and unless you have the ability to alter the physical reality through that action–which, sometimes, you don’t, especially when it involves billions of other people.

You can’t control the world with your mind. You can’t make the facts in this situation more negative through your thinking. You can, however, make those four things above (which are your responses to the material facts) “negative”. You can create negative feelings or behaviors in yourself, you can attract or become attracted to “negative’ people and situations, and you can assign negative meanings to what happens. And, your negativity could influence a few other people to be more negative.

But the whole going on of the giant matrix of cause and effect you live in is so huge that your influence on it is negligible.

Certainly optimism feels better than pessimism. Being “optimistic” while denying the facts is just plain stupid, though. And, of course, one can be optimistic and also prepare for what one hopes won’t happen. I don’t have fire insurance because I’m pessimistic. I’m just weighing the pros and cons of insurance versus the slight chance of a fire.

We ARE entering a time of severe negative social mood. We’re already in it. Throughout history, whether you like it or not, social mood periodically becomes negative. And, such times have included some rather grim events. It seems only prudent to be aware of what is happening and take reasonable steps to be prepared, just in case.

Several people claimed that because “we create our own reality,” my pointing out a “negative” situation just creates more of it. Let’s be clear, though. You only create your RESPONSE to reality. Most of your actual reality is thrust upon you. You have no say in the weather, the movements of the earth, what the sun does, the laws of nature, and almost no say about what happens in the economy, or what most of the other 7 billion people in the world do.

I hate to break it to you, but you have control over four things, and that’s it: 1) What you feel, 2) how you behave, 3) which people and situations you attract or become attracted to, and 4) what meaning you assign to what happens.

What’s more, you only have a choice about these four  things IF you’re aware enough to see HOW YOU CREATE THEM, as you do it.

And far less than 1% of people have this kind of awareness.

Looking on the bright side is always more resourceful, but ignoring the realities we face is just plain idiotic. Doing so is like ignoring a speeding car bearing down on you. Look on the bright side–and get out of the street.

Some people said that I was making predictions, and how could I be SO SURE? Others said, in effect, “This is a ‘prophecy.’ Prophecies are like streetcars. I new one comes along every 15 minutes. All such things are incorrect, so you must be incorrect, too.” Often this was followed by that person’s own favorite prophecies. (Prophecies, by the way are magical predictions not based on any sort of rational data. I am doing my best to use rational data about repeating patterns so as to be prepared for something I think is very likely to happen—and which is, in fact, already unfolding right before your eyes.)

I am not making prophecies. I am alerting you to a repeating pattern some very smart people have noticed. It is supported by a LOT of data. When we notice a pattern, we CAN use it to make some predictions.

I gave the example of the patterns of summer, fall, winter, spring. We know this pattern repeats and that certain things are more likely to happen in each season. We can’t predict exactly where you’ll go for vacation, or if you’ll have a vacation at all, but we do know it will be warmer, there will be more sunny days, people will wear lighter clothing and spend more time outdoors, and that more people will take vacations than in the winter. These are not “prophecies,” though they are reasonable assumptions based on a lot of past data about summer.

No one is sure about the specifics of what will happen, but I (and others) are very sure about what kinds of things will happen. And, if you look around, you can see that they’re happening already. To say “how can you be so certain?” is setting up a straw man.

All along I have said that what will happen is governed by probabilities, not certainties. I will say, though, that social mood is going to become VERY negative (you ain’t seen nuthin’ yet). I base this on the extreme degree of positive mood we just came out of, which was of historic preportions. That things will become very negative IS a certainty. Exactly how that will manifest is another story.

A few other people said, “It’s all One Energy, so all this concern is bullshit”.

True, it is all “one energy.” Many of you use this to deny the existence of the relative world, though. You are caught in the relative world as long as you’re alive. As a result, you are vulnerable in many ways, regardless of any transcendent reality.

Hunger, conflict, violence, disease, a 500 mile per hour wall of seawater, lack of money to pay the rent, unemployment, etc. are real physical experiences. You might not care about any of this if you’re in a transcendent state of mind, but they are still real and you and others are subject to them.

Don’t disown the relative world. There are consequences for doing that, and you won’t like them.

Physical realities cannot be easily altered, especially when they happen on a grand scale. There is nothing you can do to alter the fact–just to pick one example–that during the recent extraordinary period of extreme positive social mood (which ended about 2000), people, countries, and corporations were so positive about EVERYTHING, including that good times would never end, that they spent tomorrow’s money–ie, they spent money they didn’t have, based on the idea that they could always make more and pay it back later.

This, unfortunately, became unsustainable, the consequences of which we are still to fully pay. When a family goes into debt to buy things before they’ve earned the money, that debt can be sustained only until the interest payments become too large to pay and still buy food, shelter, etc.

At that point bankruptcy happens.

In the case of the collective debts of the world, bankruptcy is here. The authorities are holding it off with a dam made of carboard and straw, and it won’t hold forever. You might not be aware of the evidence, but that doesn’t change the facts. This world-wide bankruptcy was caused by the thinking of human beings (you included) who were so supremely confident that they thought they could keep spending tomorrow’s money forever.

Now, the money is spent and there is no way to forestall the consequences, any more than you could spend your entire paycheck two weeks before payday without suffering two weeks of no money. The only solution in such a case is to live on a lot less until the borrowed money (and the interest) is repaid. No amount of positive thinking can alter these facts. Positive thinking might allow you to come up with solutions, or take resourceful actions, but it won’t dissolve the problem. The problem is a FACT.

Either the borrower pays the money back, living on less during that process, or the borrower stops paying, in which case the lender must live on less. In this case, most people and entities fall into both categories. Any way you slice it, the world will have to live at a lower standard of living for some time. And this is only one consequence of the change in social mood from positive to negative. There will be many others.

Pointing out this rather obvious fact isn’t negative, it’s just an observation of objective reality. And no amount of positive thinking will change this reality (though it might help you take resourceful steps to prepare). The idea that the observer changes what is observed (something evoked by one of you as a supposed argument against what I have said) applies to the quantum level of reality (however not in a way New Agers claim), and to your EXPERIENCE of actual physical reality.

On the relative level (where we live, last time I checked), however, the observer does NOT affect physical reality–UNLESS he or she takes some sort of action to change that reality, which in some cases is not possible, as when a car has already been driven off a cliff. Actions that are possible are indeed preceded by thought, but the thought alone doesn’t change anything in the physical world.

Even when actions are taken, past actions have consequences and may get in the way. Often those consequences, once set in motion, are extremely difficult–often impossible–to change (as with the car and the cliff). In the case of today’s world, many of the consequences set in motion are all but inevitable—not necessarily in the specific details, but certainly in the overall shape of what is to come. And, in fact, those who are in charge are busily doing the very things that will make these consequences worse (something that has happened throughout history in times of negative social mood, by the way—and can be PREDICTED).

Positive thinking can certainly come up with the best possible way to deal with this reality, and I’m totally for “what’s the most effective thing to do” sorts of thinking, but actions have consequences, and the financial consequences of the past several decades cannot be sidestepped by any sort of attitude adjustment, any more than positive thinking could have prevented the Japanese earthquake or kept a car that has careened off a cliff from eventually hitting bottom. Physical realities have consequences.

You can pretend that this isn’t true, or call me names, or evoke some counter-theory if you want to, but if I were you, I would prepare myself, JUST IN CASE. If I’m wrong, what have you lost? If you’re wrong, watch out below.

So, in Part 3 (which this was supposed to be), I’m going to talk about what you might do to prepare. Hopefully, I should post that within the next week.

Be well.

***

By the way, for those who want more information about social mood, here’s something you might find interesting (and, by the way, I signed up for this myself just a few days ago):

The 2011 Socionomics Summit on April 16 in Atlanta will feature a dozen speakers, including five scientists whose work has captured the attention of the media.

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This has stirred things up quite a bit, don’t you think? (If you haven’t read Part 1, I suggest that you do, including the comments people have posted, and my answers to those comments, which contain a lot of important information.)

By the way, I haven’t shared any of the math involved in wave theory, or the details about the fractal nature of these waves because, though interesting, it would probably put everyone to sleep, and it’s rather complicated. If you really want to go into this more deeply, buy Robert Prechter’s books, or go to socionomics.net.

At any rate, Santiago wasn’t convinced by what I said in my first communication with him (though he seems to be more convinced now that he actually went and read up on the subject). Here is his reply to my original post, and my answer (Santiago, I’m making you famous—I hope you’re happy):

FROM SANTIAGO:

The Socionomic theory is great and Bob Prechter’s predictions have a lot of ground. And of course, whenever we find a theory that makes sense for us we tend to cling to it as THE THING.

We all live in bubbles and as usual we always see others bubbles before we see our own. This happens a lot in my experience with the people in the US, they are so focused in their own history that is very hard for them to see a more wordily perspective without comparing it with what has happened there. Although they tend to think they do.

What you suggest is something that CAN happen, – it would be nice to see some numbers on the probability of it happening – And everybody should research about it, just like everybody should research about the new waves of consciousness that are arising and their impact on society (please don’t confuse this with new age magical thinking). This among many other things creates a new context for the world in which history CAN BUT NOT NECESARILY WILL happen again. To say “just look at history” can be pretty blind sighted.

We haven’t yet developed a unified theory that can completely predict what will happen in the future.

To say that we are moving towards a utopia is as deluded as to say that the end is near.

There are people who say “follow me to utopia” this is very dangerous, there’s also people who say “the end is near” very dangerous as well. But probably the most dangerous are the ones that say “I KNOW WHAT WILL HAPPEN BEYOND THE SHADOW OF A DOUBT and the rest of you are just plain stupid for not seeing it.”

Like I said, everyone should do their own research and draw their own conclusions, but I think is unhealthy (and naive) to remove all doubt and not leave some space for the possibility of those conclusions being (at least partially) wrong.

FROM BILL: I’ll be willing to bet you ANYTHING that some version of what I’m describing IS going to happen. It’s ALREADY happening. Multiple things happen every day, and have been happening for quite a few years, that are predicted by Socionomy, and which (based on what I know about social mood) I predicted would happen–to my wife, my employees, and my friends.

Not a day goes by when someone doesn’t say to me, “You said this would happen three (or whatever) years ago” (regarding something in the news at the time: the debt crisis, the crises in Egypt, Libya, Tunesia, and other Middle Eastern countries, the situation with the public employee unions in Wisconsin, etc.)

This is not a “thing” I’m clinging to. It’s a pattern some very intelligent people have noticed, and which has been studied extensively and backed up with a massive amount of data. Understanding the wave-like nature of changes in social mood has great predictive ability. I’m watching before my eyes, day after day, the unfolding of what this pattern predicts, and I’m using it to predict what is likely to happen as time goes by.

A theory is as good as its predictive ability. This particular theory is incredibly prescient in that regard. Santiago, forgive me for saying this–you are my friend, and I like you–but you don’t know enough about this to comment on it intelligently. Educate yourself and then come back and discuss it with me (during the discussion of Part 1, Santiago did just that, to his credit).

No one can predict exactly what will happen (see my writings on chaos theory, including my recent 3-part post, Breaking Up is Hard to Do for more of an explanation of how these things are governed by probabilities, arranged in a bell curve). Certain things, however, tend to happen (i.e, are more probable) in times of increasingly positive social mood, and other things tend to happen in times of increasingly negative social mood.

The details of exactly what will happen, and how it will happen, are not predictable. Here, though, are a number of things this theory predicted in 2003 as being likely to happen. So far, they all have happened (I could give another list of things that are yet to happen, too. I use this list as partial proof of the predictive power of Socionomy).

The US stock market will lose 50% of its value (it did). Predictions, by the way, based on wave theory, are that it will ultimately lose 90%.

The economy will severely contract and the recovery will be weak. (yep.)

Many bonds will be downgraded (i.e., will be seen by the market as being much more risky). (yep.)

The federal government will place tariffs on steel imports. (yes)

Corporate leaders who were heroes and role models during good times will be vilified and scandals will bedevil the corporate world. (wow has this happened)

Horror movies will increase in number and popularity. Torture will routinely be depicted in movies and on television.

Violent sports such as “ultimate fighting” will increase in popularity. (it has)

Name calling and staunch partisanship will become staples of political commentary. (you might have noticed this)

The US Treasury’s budget surplus will turn into a huge deficit. (boy, has that happened)

Jobs will move out of the US to China, India, and elsewhere. (uh huh)

Religions will fight each other. Hostility will grow between Western countries and radical Muslims.

The US Constitution will be demonized or marginalized by some and staunchly defended by others, creating a highly contentious situation. Both patriotism and anti-government sentiment will grow into powerful emotional forces. (Progressives, Tea Party, etc)

Real estate values will fall (yep–and they aren’t finished)

Debt packages of mortgage backed bonds, credit card debt, or auto loans will become viewed as unworthy investments. (remember that this was predicted BEFORE the mortgage crisis)

Many, if not most, pension plans will fall in value and be unable to provide the promised benefits. (It’s happening right now, with a lot more to come—in fact, an avalanche).

Many banks will fail. (many did last year, many more will this year–largely unreported in the media—google Martin Weiss and start getting some of his free information, or subscribe to his newsletters)

The dollar will increasingly be looked upon as being unworthy for its role as the world’s reserve currency. (definitely happening)

The “rich” will be vilified and their property will be increasingly taxed and seized. (definitely happening)
Unemployment will become a serious problem. (the real unemployment rate is much higher than the government figures say it is)

Countries will adopt numerous trade restrictions, import taxes and other protectionist measures.
(definitely happening—by the way, this raises the price of everything you buy that comes from other countries to supposedly protect businesses in your country)

Consumer confidence will fall to record low levels. (in process of happening)

Affordable housing will become difficult to come by. Family members will increasingly move in with each other. (happening)

A Democrat will be the next US president. (this obviously happened)

Politics will become far more polarized, splintered, and radical. (you may have noticed this)

Social Security in its present form will fail. (Imminent and inevitable)

The US will require internal travel papers. (in the works)

The US will accelerate its tend toward socialism and centralized control. Opposition to that trend will be vigorous. (Exactly what is happening and will continue to happen.)

The Drug War will become more violent and will spill over into the US. (it has)

The US government will ration goods and services, such as gasoline, vaccines, medical care, electricity, water, food, etc. (Either already happening or in the works–plans in place)

The birth rate will fall in the US and other advanced Western countries. (happening)

Religions will become increasingly popular. Religious intolerance will increase.

Belief in magic will increase. (unfortunately, it has—when people can’t explain what is happening, they are more open to non-rational explanations, and more easily hoodwinked by charlatans)

Science will be turned to manipulative or malevolent purposes. (it has been—remember the Nazi medical experiments, or the Tuskegee syphilis experiments in the US, from previous times of negative social mood?)

Environmentalists will become militant and intentionally destructive. (yes)

The US space program will shut down. (no more space shuttle—last flight is happening now)

Conspiracy theories will become plentiful, and more people will believe them. (boy, oh boy, yes)

People will rate the future as increasingly less promising (they do, in every poll)

Race relations will become strained and violent (border problems?)

The suicide rate will go up. (it has)

Mass demonstrations expressing anger with certain social situations will occur (just turn on your TV)

Self help books will change from how to get rich and successful to how to deal with hard times (yes)

Food scares will hit the US (already happening, more to come)

Restaurants will decline in popularity. More people will eat at home. (yes)

Disney will close its NY city theater productions (they haven’t, yet, but they did close their animation division)

Gangsters, pirates, and other outlaws will become popular folk heroes (Pirates of the Caribbean? College pirate parties? Remember the popularity of John Dillinger in the 1930s? The modern-day equivalent is coming.)

Entertainment will feature fewer heroes and more anti-heroes.

Organized labor will grow and become more active and militant (public employee unions)

Believe me, I could go on (and on). Some of you may not be familiar with many of these things unless you follow the news closely and have alternative sources (many of these things are not reported in the mainsteam media). I follow all these areas very closely, and have watched these things unfold. These things are typical of what happens in times of increasingly negative social mood.

The following list contrasts attitudes, behaviors, and emotions in times of positive and negative social mood:

adventurousness/protectionism
alignment/opposition
benevolence/malevolence
clarity/confusion
concord/discord
confidence/fear
constructiveness/ destructiveness
desiring power over nature/desiring power over people
ebullience/depression
embrace of effort/avoidance of effort
happiness/unhappiness

peace/war
inclusion/exclusion
freedom/authoritarianism
interest in love/interest in sex
liberality/restriction
optimism/pessimism
practical thinking/magical thinking
search for joy/search for pleasure
praise/criticism
togetherness/separatism
helping others/harming others

Quite frankly, you’d have to be blind, have a certain agenda, or be intentionally averting your eyes and refusing to pay attention (which I understand, since paying attention to all this stuff IS depressing) to not see that all of this is, indeed unfolding.

I’m not saying this to predict the end of the world or to be negative, or to make you feel bad. I’m not a negative person. I’m a realistic person. If you know what is happening, you’ll be better able to deal with it.

Unfortunately, I think:

The economy is going to get worse. Much worse.

Most debts will never be repaid (which means the lender pays them). This includes public employee pensions, government and municipal bonds, social security, health care entitlements, mortgage debts, and a lot more.

The confidence necessary to cause those who have money to lend it to people or to institutions will plummet, with dire consequences for the economy.

Tensions between all kinds of groups will increase even more than they already have, particularly between Western countries and radical Muslims (who are poised to take over several Middle Eastern countries right now), but also between business and labor, the left and the right, rich and poor, different races, taxpayers and public “servants”, etc. etc.

Socialists and communists (and, probably, at some point, fascists) will gain more and more traction as people search for someone to lead them out of the chaos.

War will eventually come in many places around the world.

There will be severe energy problems—though not from real shortages of energy.

There will be increased violent terrorist attacks, including in the US.

There will be problems with the food supply in many parts of the world. Food riots are already happening in several countries.

There will be epidemics, and the medicines to treat them will be mismanaged and unavailable to many who need them.

There will be a further increase in authoritarianism and centralized, top-down control, and a huge loss of freedom of choice (regarding what you can buy, what you can say, what kind of food you can eat, what car you can drive, when you can use electricity, where you can freely go (across borders? Even to different states in the US?), what you can see online, what kind of entertainment is legal, etc). This one will particularly blindside (and enrage) Americans, who are not used to being regulated and controlled.

Barbaric actions will come to light that will rival (and probably exceed) the barbarism of Hitler, Stalin, Mao and other crazies from the past. (It has already come to light that the US has been shipping suspected terrorists to Egypt and other Middle Eastern countries where their secret police have tortured these prisoners. Worse things will come to light over the next several years.)

Many of these problems and the resulting chaos will be used by people selling utopian ideas to get people to follow them. Huge numbers of people, who are panicking about their situation and see no other choice, will easily be hoodwinked, and will follow these people. You might be one of them and not even know it until it’s too late. This is what happened in the 1930s and 1940s. We remember Hitler based on what we ultimately found out about him. In the beginning he (and Mussolini) were seen as practical problem-solvers.

This will not end well. It never has.

***

But there’s more. As I’m sure you’ll agree, this is a rather depressing topic. Next, in Part 3, I’ll share a post from someone who feels that way about it, and what I said to her.

As for comments about this post, I welcome them. However, please—don’t put words in my mouth and then argue against them. It’s so tiresome. If you have a reasonable question, or have some factual dispute, great. Please, however, learn something about this topic BEFORE ranting about it.

***

I just received this email, which you might find interesting if you’d like to know more about socionomics:

If you attend only one conference this year, this is the one!

The Socionomics Institute holds their first-ever Socionomics Summit in Atlanta on April 16. They’ve kept the registration fee as low as possible: $199 for a FULL day.

Join Robert Prechter, Mood Matters author John Casti, “Twitter mood predicts the stock market” authors Johan Bollen and Huina Mao, billion dollar hedge fund manager Scott Reamer, Minyanville sage Kevin Depew, EWI’s Peter Kendall — just to name a few!

Check out the complete speaker line-up below, or follow this link for full speaker bios and to learn more about this exciting event. 

http://www.socionomics.net/education/socionomics-summit/The2011SocionomicsSummitNewHorizonsintheStudyofSocialMood.aspx?code=emsub&tcn=socsumf1102&rcn=socsumf11021

Regards,

The Socionomics Institute

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It all started from a simple question on my blog (from someone I know quite well)…

But what started as a simple question, buried in the comments after one of my recent posts, where many people would never see it, turned into a lengthy description of my take on what’s going on in the world, from an “as viewed from outer space” big-picture perspective.

Though a lot of this falls into the “not at all what you wanted to hear” category, I decided that I should share it with everyone—which I will do over the next several days in a series of posts.

It started this way:

A question for you.

After the years you have lived, the work you’ve done and the things you’ve seen, if I’d ask you what do you expect out of life, of your days remaining here, what would you say? What’s your view?

Love,

Santiago

My answer: I get up, I eat, I come to work, I do my best to help people, I go home, I spend time with my wife, I play the saxophone, I see my kids and grandkids, I read, I pay close attention to the financial markets and the world situation, I go to bed.

***

Thanks Bill,

From Santiago: Very zenny – chop wood, carry water, I don’t care much – answer. You speak a lot about dark times coming. Do you have any guesses on what will come out of that ? (I know it’s a lengthy topic).

In my own view there is a clear tendency towards integration in the world, which comes with more and more people having experiences of unity (an evolutionary process). Like the world is realizing that is one body breathing and one mind thinking, one process evolving. From a hindu perspective we could be moving as humanity from a 3rd chakra (look for power) center to the 4rth one (non dual love).

Of course this is (like most processes in nature) not smooth and easy, like the birth of a child, doesn’t come without tears and blood, so is not like we’re gonna start loving each other just like that, but it could be an intelligence emerging. Because otherwise individual inexhaustible egoistic appetites will clearly end with humanity as species.

Any thoughts on this ?

Thanks as usual for the blog and for sharing all this wisdom.

***

My answer: I don’t think we’re moving into the Age of Aquarius, or some period of collective love. In fact, just the opposite. And, I doubt that more people are having experiences of unity now than at any other period in history, other than perhaps because there are more people in the world than ever before in history. Those of us who’ve spent enough time meditating or doing other spiritual practices in order to have some sort of transcendent experience are a tiny fraction of the population of the world. Most such experiences are spontaneous and the person having the experience may or may not have any idea whether it is significant or not. Most would just think, “Wow. That was a cool and weird experience.”

Positive and negative social mood moves in waves governed by certain mathematical relationships that are built into the universe. If you look carefully at history, going back, say, 10,000 years, and look at the archeological evidence in pre-history times, and the much greater evidence as we get closer to modern times, you can clearly see the times when social mood was negative. I do see us entering such a time of increasingly negative social mood–in fact, a BIG one. And though things are obviously much more contentious and negative now than they were ten years ago (or even five), I don’t think the REAL dark times are here yet.

When such times come, human beings can do such savage things that it’s almost unbelievable. The 1930s and 1940s provide the most recent relatively big example. These two decades included:

* The Nazis

* A vicious Japanese attempt to subjugate much of East Asia

* Stalin and his killing of millions of people (more than Hitler, by the way)

* Mao fighting the Kuomintang and the Japanese in China (and using the chaos to take over China, leading to up to 70,000,000 deaths by some accounts)

*Millions of deaths from war, starvation, etc, destruction of entire cities

* American Nazi rallies in Madison Square Garden in the US

* A world-wide depression

* US communists coming out of the woodwork and gaining many key posts in the US government

* Vicious street fighting in Europe (even before WW2)

* And a lot more.

There were riots, epidemics, economic meltdowns, and every radical nutjob came out of the woodwork (Huey Long [on the left], Father Coughlin [on the right], etc—google them).

When chaos takes over, radicals like these, of all stripes, stand on their soapboxes and shout to the crowds, “Don’t worry, I have the answer.” Their answer is usually deadly for the world, but things are so bad, and people are so confused that they are willing to follow someone who seems to have an answer. The same will happen this time, and it’s already starting.

Looking at history, this sort of thing has happened over and over. We like to think that today we’re more civilized, and that “it can’t happen here,” but the Nazi era ended just 5 years before I was born, which isn’t that long ago. I don’t think in the last 65 years humans have matured that much. And, of course, mass killings have continued to happen since, even during times of positive social mood.

Most historians estimate that the communists in China were responsible for between 40,000,000 and 70,000,000 deaths (some of this came during a less severe downturn in social mood, from the late 1960s to the late 1970s–during which time, by the way, just in the US, Robert Kennedy, Medger Evers, Martin Luthor King, Malcolm X and others were assassinated, there were riots at the Democratic convention in Chicago, several race riots broke out in US cities, black churches were firebombed, students were shot and killed by the National Guard at Kent State University, numerous anti-war rallies were held (some of them quite violent), and the entire country was fractured over the Vietnam war).

When times of negative social mood come, civilization flies out the window, and it will this time, too. In times of positive social mood (and a major such time peaked about ten years ago) everybody loves everyone else, everything seems possible. In times of negative mood, everything turns upside down and the worst side of people comes out. Based on the size of the peak of positive mood, which happened about ten years ago, this downturn should be much bigger than in the 1930s, which was terrible enough.

I suspect there will be economic devastation, total chaos, epidemics (the Black Death, around 1350, happened during a time of declining social mood, and killed between 30-60% of Europe’s population), and every other bad thing you can think of. Leaders often use such times to further centralize power (if you want power, “never let a good crisis go to waste”) and reduce freedom of expression, movement, choice, etc.

It’s difficult to not get swept up in social mood even if you’re aware that it’s happening. All you can do is become more aware of what is going on (despite the fact that paying attention during negative times is difficult and doesn’t improve your mood one bit—not to mention the fact that the media isn’t reporting what’s really happening, and a lot of the information comes from radical sources that have a decided agenda but may appear to be valid—requiring you to develop alternate sources of information) and do your best to stay out of the way of danger, nutjobs, etc. Think of the fall of the Roman Empire and what that must have been like on the basic level of the everyday person.

What will come out of it? No one knows. However, usually there is a battle during such times between two forces. Generally speaking, this battle is between those who want authoritarianism and those who want freedom. These two forces were represented in the 1930s and 1940s by the Nazi’s and the Soviets on one side and Western democracies on the other (even though the Soviets and Western democracies were allies against Hitler, the Soviet approach to life was more like Hitler’s).

Sometimes the good guys win, and sometimes the bad guys win. Sometimes it’s hard to tell which is which, or there are no good guys. I don’t think there’s any guarantee that good will triumph during these battles. It depends on what people do. What would the world be like if Hitler had won? What if the US hadn’t been involved in the war in Europe in WW2 and the Soviet Union took over Europe after defeating Hitler? Many times in history the most vicious people have “won” and slaughtered millions. Look up Genghis Khan and Tamerlane, for instance.

Though not directly about this subject (for more about social mood, google socionomy), a book I highly recommend, as it goes though the entire history of humanity, based on the most recent archeological findings (and is written by a quite witty and highly readable author, Ian Morris) is Why the West Rules–for Now. This book gives you a fascinating look at the scope of human history. Though the author isn’t hip to the influence of social mood, you can clearly see it at work in this book (Richard Martin, you will LOVE this book).

I’m not saying that we’re all going to be in bomb shelters, or that life will necessarily or continuously be one of grim survival (though look at what WW2 was like for the people of Europe). What happens during such times for you is at least partly under your control. Inform yourself. Figure out what you can do to be more prepared and do it. Strengthen your social ties to those you love. Begin to realize that the best things in life are free and take advantage of those freebies.

As always, the best thing anyone can do to better navigate life, whether in times of positive or negative social mood, is to BECOME MORE AWARE. Holosync makes you more aware, and does it more quickly, than anything I’ve ever seen (and I’ve been around that block MANY times).

I’ve been trying to get across on this blog that there are some key things about life that are a choice, IF you are aware enough to see how you create them. Other things, especially cause and effect and impermanence, can be affected a little bit, but in the grand scheme of things, and in an ultimate sense, they are beyond your control (see my many posts about this topic). Those things you have to acknowledge and make your peace with (or, alternately, make yourself miserable fighting the unwinnable fight against them).

I’m not trying to be negative in all this, just realistic.

One last note: be careful of those who promise “Follow me to Utopia!”–which can take many forms. Progressives, communists, socialists, and fascists are all famous for making such promises (and people are much more likely to listen to them in times of declining social mood), clothing their plans in attractive garments. These things always end very badly.

***

But the discussion didn’t end with that. Unbelievably (!) Santiago didn’t agree with me! In my next post I’ll share Santiago’s answer, along with some shocking details I then shared with him to support my contention that we are entering a period of severely negative social mood.

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Over the New Year’s holiday someone posted the following comment about how he had personally responded to my remarks about this topic. Rather than just post my answer under his post, as I often do, I’ve decided that this is important enough to warrant a separate post.

Though this is quite short, I think it will really give you something to think about.

THE COMMENT: I think I may have taken some of your advice too closely, or used it in the wrong way. I took what you said about impermanence and said, ‘If I’m happy I can’t enjoy being happy because it’s impermanent and will go away’… which keeps me from being happy when I notice it. It’s quite strange, and like I’m waiting for something to let me go ‘full happy’. Except if I ever noticed that I was on ‘full happy’ I might say, ‘hey stop that’. –James

MY ANSWER:

You’re experiencing your own resistance to the fact that everything is impermanent–which, unfortunately, is what quite a bit of the human response to life ends up being about. If you go back and read the posts where I talk about impermanence (“News Flash: There’s No Escape”, “Where are You Going–And Why”, “Seeing Things the Way They Really Are, Parts 1-3″–and several others) you’ll notice that I’ve outlined many of the human activities, philosophies, and ideas that are are derived from our attempts to put off, defeat, or deny impermanence (these include magical thinking, including beliefs in some sort of afterlife, attempts to defeat aging by following certain health regimens (wacky or otherwise), trying to accumulate a lot of money, trying to become more powerful, attempts to develop various “powers”, etc).

Impermanence freaks people out, and our own impermanence freaks us out even more than the impermanence of the people and things we’re attached to.

Particularly up until a certain developmental stage people have a lot of trouble acknowledging their own impermanence (see my series of posts on human developmental levels starting at the beginning of this blog). This is why humans have created so many explanations for what supposedly happens after death–it somehow makes it easier if we pretend that the end of our separate self isn’t really an end. One sign of spiritual maturity is the ability to acknowledge and deal with our own impermanence–plus an acknowledgement of something else humans don’t want to admit: that no one really knows what’s really going on, why we’re here, what it’s all about, how it started, where it’s going, etc.

In terms of our own death, we’re talking about the impermanence of the separate self created by our brain/mind–our IDEA of who we are. I’ve extensively written about the fact that the separate self is just an idea, and that there are no separate things or events except in the mind. Separate things and events are merely ideas about reality–handy ideas, to be sure, but still, they are just ideas. There is really just one thing-event (for want of a better word): the entire interconnected going on of it all. The mind chops this one thing-event into many, and then assumes that if many things and many events exist in the mind they must also exist “out there.” This is what some call “mistaking the map for the territory.”

When the brain/mind that creates these ideas comes to an end, so do the ideas–including the idea (and consciousness) of “me.” Certainly the one thing-event, the entire going on of it all, continues, and the atoms that made up what you thought of as “me” continue to be a part of the whole. In fact, during the entire time that you’re being a “me” there is a constant flow of atoms into and out of “you”. You are an ever-changing pattern or “whirlpooling” of matter and energy, with constant input and output.  In this way you are connected to, an aspect of, the whole. This is why I say that the universe is one interconnected thing-event.

We don’t like it that our idea of “me” ends, though. We’re quite attached to it, and its impending end freaks us out. We think we ARE this idea–again, the mistaking of the map for the territory. My last three posts were about how when we go into chaos and reorganize we resist the temporary end of the old me as a reorganization at a higher level is creating a new me. A time comes, however, when this reorganization can’t happen. Entropy takes over. The brain/mind dies, and all its ideas cease to exist, including the idea of “me.”

What I’m advocating is an acknowledgement of WHAT IS–including the fact that everything is impermanent. Despite what you might think, this acknowledgment creates a profound sense of freedom, spiritually and otherwise. Even when people use the strategies I mentioned (and some I didn’t list) to not acknowledge impermanence, they still suffer from an underlying fear of it. Impermanence becomes a shadow, a disowned aspect of being human (I’ve also written quite a bit about shadows on this blog, should you care to peruse the library of past posts).

Shadows express themselves despite the fact that they’ve been disowned, despite our attempts to push them out of our awareness. Their expression, though, when disowned, is dysfunctional, delusional, and immature. It creates suffering, both for the person doing the disowning and for others. Much of human suffering and cruelty is, in fact, related to the expression of this shadow.

I suspect that no one, no matter how “spiritually advanced,” becomes entirely comfortable with the fact that his or her life will end. However, when a spiritually mature person acknowledges and makes his or her peace with impermanence, a great deal of the related shadow problems disappear and are replaced with a profound sense of peace, compassion for others, and greater mastery of life–the qualities you see in great spiritual masters.

In James’ feeling that he can’t enjoy anything because it’s all impermanent anyway, I think he may be experiencing Elizabeth Kubler-Ross’s five stages of grief regarding his own impermanence. Going through these stages is part of the process of becoming spiritually mature. The most esoteric training of spiritual paths that deal with this question–sometimes referred to as “the great matter of life and death”–are, in effect, methods for moving through something akin to these stages–though the process isn’t always framed in this exact way.

It’s a bit self-defeating, though, to say that since everything ends there’s no value in experiencing it. This is why many spiritual traditions talk about “being in the moment” or suggest that you “be here, now” instead of mentally being in the future, when what’s happening now (and, in an ultimate sense, you) will have ended. When you’re just being here, now, the fear of impermanence has no hold on you. In fact, the now moment becomes much more significant, and much more alive.

Some people say that it’s better to just ”have faith”–in effect, to believe that impermanence isn’t real. Everyone is, of course, free to do that, and many people do. Isn’t it interesting, though, that among the most revered humans in history are great spiritual masters who have made their peace with impermanence? Those who look reality (one significant aspect of which is impermanence) in the eye and make their peace with it seem to share certain rare qualities–they exude power, equanimity, poise, peace, and compassion.

You sometimes see these qualities in a person with a terminal illness who, after moving through the stages of grief, finally comes to terms with the fact that they are dying. Family, friends, and caretakers often report feeling what some call “a contact high” from being around such a person, and are often in awe as this person goes through his or her death process.

I’m not sure what advice to give about this question, as it isn’t something easy to explain in a few paragraphs. My own coming to peace regarding this matter, to whatever degree I’ve done that, has been the result of forty-plus years of meditation and many years of work with various teachers, culminating in my association with Genpo Roshi these last few years. Not many people make their peace with impermanence. It’s much easier–or at least it seems so–to avoid the question.

To make your peace with life–and death–you have to look it squarely in the eye, which I think you’re beginning to do, James. That you noticed your response and were able to step back and comment on it shows a higher level of awareness on your part. So, keep going. Sit with this question of life and death until it loses its hold on you.

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