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Tithing is a spiritual law. You give of the first fruits; you give first to God in thanks for all that comes to you. When you do this without seeking any return, but openly in gratitude for what you have received, you keep yourself under God's law, or grace, rather than the law of the negative realms. It is one way of keeping your eyes on the Lord.
— John-Roger, DSS

Saturday, August 29, 2009

Are there any adults in the room?

In past posts I have explored the idea of "getting ready." There is the game the world plays. It is a difficult game to win because inherent within it is the compromising of values and dishonesty, and we are certainly seeing more and more of that everyday.

And what is it to win at the world's game anyway? The world is run by a negative power that is a master at the game.

So we must play a different game and follow another master, hence this blog outlining the spiritual principles of abundance and prosperity which require one essential step--connecting to the divine. Not through words but through action. It is a winnable game because it is not a worldly game. It is a game of consciousness.

If I would name the game I would call it, "Can You Let Go?"

The below is one of the best articles on the economy I have read in a long time. It is non-technical and clear and free of invective. PLease take the time to read it. I have reproduced it in full. It is by John Maudlin.

An Uncomfortable Choice

As our family grew, we limited the choices our seven kids could make; but as they grew into teenagers, they were given more leeway. Not all of their choices were good. How many times did Dad say, "What were you thinking?" and get a mute reply or a mumbled "I don't know."

Yet how else do you teach them that bad choices have bad consequences? You can lecture, you can be a role model; but in the end you have to let them make their own choices. And a lot of them make a lot of bad choices. After having raised six, with one more teenage son at home, I have come to the conclusion that you just breathe a sigh of relief if they grow up and have avoided fatal, life-altering choices. I am lucky. So far. Knock on a lot of wood.

I have watched good kids from good families make bad choices, and kids with no seeming chance make good choices. But one thing I have observed. Very few teenagers make the hard choice without some outside encouragement or help in understanding the known consequences, from some source. They nearly always opt for the choice that involves the most fun and/or the least immediate pain, and then learn later that they now have to make yet another choice as a consequence of the original one. And thus they grow up. So quickly.

But it's not just teenagers. I am completely capable of making very bad choices as I approach the end of my sixth decade of human experiences and observations. In fact, I have made some rather distressing choices over time. Even in areas where I think I have some expertise I can make appallingly bad choices. Or maybe particularly in those areas, because I have delusions of actually knowing something. In my experience, it takes an expert with a powerful computer to truly foul things up.

Of course, sometimes I get it right. Even I learn, with enough pain. And sometimes I just get lucky. (Although, as my less-than-sainted Dad repeatedly intoned, "The harder I work the luckier I get.")

Each morning is a new day, but it is a new day impacted by all the choices of the previous days and years. Tiffani and I have literally interviewed in depth well over a hundred millionaires, and talked anecdotally with hundreds over the years. I am struck by how their lives, and those of their families, come down to a few choices. Sometimes good choices and sometimes lucky choices. Often, difficult ones. But very few were the easy choice.
What Were We Thinking?

As a culture, the current mix of generations, especially in the US, has made some choices. Choices which, in hindsight, leave the adult in us asking, "What were we thinking?"

In a way, we were like teenagers. We made the easy choice, not thinking of the consequences. We never absorbed the lessons of the Depression from our grandparents. We quickly forgot the sobering malaise of the '70s as the bull market of the '80s and '90s gave us the illusion of wealth and an easy future. Even the crash of Black Friday seemed a mere bump on the path to success, passing so quickly. And as interest rates came down and money became easier, our propensity to acquire things took over.

And then something really bad happened. Our homes started to rise in value and we learned through new methods of financial engineering that we could borrow against what seemed like their ever-rising value, to finance consumption today.

We became Blimpie from the Popeye cartoons of our youth: "I will gladly repay you Tuesday for a hamburger today."

Not for us the lay-away programs of our parents, patiently paying something each week or month until the desired object could be taken home. Come to think of it, I am not sure if my kids (15 through 32) have ever even heard of a lay-away program, not with credit cards so easy to obtain. Next family brunch, I will explain this quaint concept.

(Interestingly, I heard about a revival of the concept on CNBC radio, coming back from dropping Trey off at school this morning. Everything old is new again.)

As a banking system, we made choices. We created all sorts of readily available credit, and packaged it in convenient, irresistible AAA-rated securities and sold them to a gullible world. We created liar loans, no-money-down loans, and no-documentation loans and expected them to act the same way that mortgages had in the past. What were the rating agencies thinking? Where were the adults supervising the sand box?

(Oh, wait a minute. That's the same group of regulators who now want more power and money.)

It is not as if all this was done in some back alley by seedy-looking characters. This was done on TV and in books and advertisements. I remember the first time I saw an ad telling me to call this number to borrow up to 125% of the value of my home, and wondering how this could be a good idea.

Turns out it can be a great idea for the salesmen, if they can package those loans into securities and sell them to foreigners, with everyone making large commissions on the way. The choice was to make a lot of money with no downside consequences to yourself. What teenager could say no?

Greenspan keeping rates low aided and abetted that process. Starting two wars and pushing through a massive health-care package, along with no spending control from the Republican Party, ran up the fiscal deficits.

Allowing credit default swaps to trade without an exchange or regulations. A culture that viscerally believed that the McMansions they were buying were an investment and not really debt. Yes, we were adolescents at the party to end all parties.

Not to mention an investment industry that tells their clients that stocks earn 8% a year real returns (the report I mentioned at the beginning goes into detail about this). Even as stocks have gone nowhere for ten years, we largely believe (or at least hope) that the latest trend is just the beginning of the next bull market.

It was not that there were no warnings. There were many, including from your humble analyst, who wrote about the coming train wreck that we are now trying to clean up. But those warnings were ignored.

Actually, ignored is a nice way to put it. Derision. Scorn. Laughter. And worse, dismissal as a non-serious perpetual perma-bear. My corner of the investment-writing world takes a very thick skin.

The good times had lasted so long, how could the trend not be correct? It is human nature to believe the current trend, especially a favorable one that helps us, will continue forever.

And just like a teenager who doesn't think about the consequences of the current fun, we paid no attention. We hadn't experienced the hard lessons of our elders, who learned them in the depths of the Depression. This time it was different. We were smarter and wouldn't make those mistakes. Didn't we have the research of Bernanke and others, telling us what to avoid?

In millions of different ways, we all partied on. It wasn't exclusively a liberal or a conservative, a rich or apoor, a male or a female addiction. We all borrowed and spent. We did it as individuals, and we did it as cities and states and countries.

We ran up unfunded pension deficits at many local and state funds, to the tune of several trillion dollars and rising. We have a massive, tens of trillions of dollars, bill coming due for Social Security and Medicare, starting in the next 5-7 years, that makes the current crisis pale in comparison. We now seemingly want to add to this by passing even more spending programs that will only make the hole deeper.

Frugality is the New Normal

I could go on and on, but I think you get the point. The time for good choices was a decade ago. It would have been more difficult at the time, so that is not what we did. And now we wake up and are faced with a set of choices, none of them good.

Reality is staring back in the mirror at the American consumer, and especially the Boomer generation. The psyche of the American consumer has been permanently seared. We are watching savings beginning to rise and consumer spending patterns change for the first time in generations. Even as the authorities try to prod consumers back into old habits, they are not responding. Borrowing and credit are actually falling. Banks, for whatever reason, now want borrowers to actually be able to pay them back. Go figure.

Frugality is the new normal. We are resetting the underpinnings of a consumer-driven society to a new level. It will require a major overhaul of our economy. The normal drivers of growth - consumer spending, business investment, and exports - are all weak, and it is only because of massive government spending that the second quarter was not as bad as the two previous quarters and that the coming quarter will be positive.

But what then? How long can we continue with 10%-plus GDP deficits? We have an economy that is in a Statistical Recovery, fueled by government largesse. In the real world, we are watching unemployment rise, and it is likely to do so through the middle of next year. Deflation is in the air. Capacity utilization is near all-time lows. Housing numbers are only bouncing because of the government program of large tax credits for first-time home buyers and lower home prices. It will be years before construction is significant.

We will be faced with a choice this fall and early next year. If you take away the government spending, the potential for falling back into a recession is quite high, given the underlying weakness in the economy. A few hundred billion for increased and extended unemployment benefits will not be enough to stem the tide. There will be a groundswell for yet another stimulus package. Another 10% of GDP deficit is quite likely for next year.

As I (and Woody Brock) have made very clear in these e-letters, deficits that are higher than nominal GDP cannot continue without dire consequences. Good friend Richard Russell writes today:

"The US national debt is now over $11 trillion dollars. The interest on our national debt is now $340 billion. This is about at 3.04% rate of interest. In ten years the Obama administration admits that they will add $9 trillion to the national debt. That would take it to $20 trillion. Let's say that by some miracle the interest on the national debt in 10 years will still be 3.09%. That would mean that the interest on the national debt would be $618 billion a year or over one billion a day. No nation can hold up in the face of those kinds of expenses. Either the dollar would collapse or interest rates would go through the roof."

That would be at least 30% of the national budget. How would your household do, paying that much as interest? How can you operate when interest payments are 30% or more of the budget? Do you borrow to pay the interest? And the Obama administration openly admits to deficits of over a trillion a year for the next ten years, under very rosy growth assumptions. Anyone outside of Washington and rosy-eyed economists think we will grow 4% next year? I am not seeing many hands go up.

And Then We Face the Real Problem

If we do not maintain high deficits, it is likely we fall back into recession. Yet if we do not control spending, we risk running up a debt that becomes very difficult to finance by conventional means. Monetizing the debt can only work for a few trillion here or there. At some point, the bond market will simply fall apart. And it could happen quickly. Think back to how fast things fell apart in the summer of 2007. When perception of the potential for inflation changes, it changes things fast.

The problem is that we are now in a very deflationary world. Deleveraging, too much capacity, high and rising unemployment, falling real incomes, and more are all the classic pieces of the formula for deflation.

Let's look at what my friend Nouriel Roubini recently wrote. I think he hit the nail on the head:

"A combination of higher official indebtedness and monetization has the potential to yield the worst of all worlds, pushing up long-term rates and generating increased inflation expectations before a convincing return to growth takes hold. An early return to higher long-term rates will crowd out private demand, as lending rates on mortgages and personal and corporate loans rise too. It is unlikely that actual inflation will emerge this year or even next, but inflation expectations as reflected in long-term interest rates could well be rising later in 2010. This would represent a serious threat to economic recovery, which is predicated on the idea that the actual borrowing rates that individuals and businesses pay will remain low for an extended period.

"Yet the alternative - the early withdrawal of the stimulus drug that governments have been dispensing so freely - is even more serious. The present administration believes that deflation is a worse threat than inflation. They are right to think that. Trying to rebuild public finances at a deflationary moment - a time when unemployment is rising, and private demand is still contracting - could be catastrophic, turning recovery into renewed recession."

There are no good choices. Nouriel, optimist that he is (note sarcasm), suggests that there is a possibility that the government can manage expectations by showing a clear path to fiscal responsibility that can be believed. And thus the bond markets do not force rates higher, thereby thwarting recovery.

And technically he is right. If there were adults supervising the party, it might be possible. But there are not. The teenagers are in control. Instead of fiscal discipline, we are hearing increased demands for more spending. Please note that the very rosy future-deficit assumptions assume the end of the Bush tax cuts at the close of 2010. But raising taxes back to the level of 2000 does not make the projected future budget deficits go away.

I mean, seriously, does anyone think Pelosi or Reid are going to lead us to fiscal constraint? Obama talks a good game, but he has not offered a serious deficit-reduction proposal, other than further tax increases. And by serious, I mean we need cuts on the order of several hundred billion dollars. The Republicans lost their way and their power (deservedly, in my opinion). Just as at the high school prom, the very few adults are being ignored.

It is the proverbial rock and the hard place. Cut the stimulus too soon and we slide back into a deeper recession. Let the budget spin out of control for a few years and we will see inflation return, with higher rates and a recession. Raise taxes by 1.5-2% of GDP in 2010 and we are shoved back into recession.

There are no good choices. If we do the right thing and cut the deficit, it means very hard choices. Can we keep our commitments to two wars and our massive defense budget? Medicare and Social Security reform are not painless. Education? Research? The "stimulus"? But cutting the deficit by hundreds of billions while raising taxes by even more than is already in the works, is not the formula for sustainable recovery.

Have we grown up? Are there adults in the room? Sadly, I don't think there are enough. We are still a nation of teenagers. We will do whatever we can to avoid the pain today. We will kick the can down the road, hoping for a miracle. Will we grow up? Yes, but the lessons learned will be hard.

There are no statistical signs of an impending recession. We are not going to get an inverted yield curve this time, which made it relatively easy for me to predict recessions in 2000 and 2006. We are in a deflationary, deleveraging world. A far different world than in the past.

I see little room for us to avoid a double-dip recession. It would take the skill and speed of former Cowboys running back Tony Dorsett hitting a very small hole in the line to break us into the open. I see no running back in our national leadership with such ability. As I have outlined above, recession could be triggered again in any number of very different economic environments. It all depends on the choices we make. But the choices lead to the same consequences, at least in my opinion.

As I wrote in August 2000 and August 2006, I write again in August 2009: there is a recession in our future. I was early both of those times and I am early now, maybe two years early, though I doubt it. And as I pointed out both of those last times, the stock market drops an average of over 40% during a recession. When I was on Kudlow in October of 2006, I was given a hard time about my recession call and prediction of a bear market. I think it was John Rutherford who dismissed my bearish vision. And he was right for the next three quarters, as the market proceeded to rise another 20%. I looked foolish to many, but I maintained my views.

You have choices. You can buy and hold (buy and hope?) or you can develop a strategic alternative. The next bear market, as I wrote in 2003 and in Bull's Eye Investing, will likely be the bottom. (It takes at least three of them to really take us to the bottom.) But the next one will change perceptions for a long time. Valuations will drop. Savings will rise even more. And a generation will grow up. The adults will return. Chastened. Scarred. Shaken. But we will Muddle Through. That is what we do. Even my teenagers.

Choose wisely.

John Mauldin, Best-Selling author and recognized financial expert, is also editor of the free Thoughts From the Frontline that goes to over 1 million readers each week. For more information on John or his FREE weekly economic letter go to:


Posted by Paul Kaye at 3:58 PM
Keywords: Getting Ready, Letting Go, The Economy, Values
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Wednesday, August 26, 2009

Go Revisited

In past posts I have spoken extensively about the Game of Go. Chess is about win/lose and is mostly tactics. Go is more about a longer range strategic approach, in which even the loser usually ends up with some territory. Chess is primarily played in the West. Go in the East.

This interesting article by Ambrose Evans-Pritchard highlights what I was attempting to convey:

Beijing is drawing up plans to prohibit or restrict exports of rare earth metals that are produced only in China and play a vital role in cutting edge technology, from hybrid cars and catalytic converters, to superconductors, and precision-guided weapons.

A draft report by China’s Ministry of Industry and Information Technology has called for a total ban on foreign shipments of terbium, dysprosium, yttrium, thulium, and lutetium. Other metals such as neodymium, europium, cerium, and lanthanum will be restricted to a combined export quota of 35,000 tonnes a year, far below global needs.

China mines over 95pc of the world’s rare earth minerals, mostly in Inner Mongolia. The move to hoard reserves is the clearest sign to date that the global struggle for diminishing resources is shifting into a new phase. Countries may find it hard to obtain key materials at any price.

Alistair Stephens, from Australia’s rare metals group Arafura, said his contacts in China had been shown a copy of the draft -- `Rare Earths Industry Development Plan 2009-2015’. Any decision will be made by China’s State Council.

“This isn’t about the China holding the world to ransom. They are saying we need these resources to develop our own economy and achieve energy efficiency, so go find your own supplies”, he said.

Mr Stephens said China had put global competitors out of business in the early 1990s by flooding the market, leading to the closure of the biggest US rare earth mine at Mountain Pass in California - now being revived by Molycorp Minerals.

New technologies have since increased the value and strategic importance of these metals, but it will take years for fresh supply to come on stream from deposits in Australia, North America, and South Africa. The rare earth family are hard to find, and harder to extract.

Mr Stephens said Arafura’s project in Western Australia produces terbium, which sells for $800,000 a tonne. It is a key ingredient in low-energy light-bulbs. China needs all the terbium it produces as the country switches wholesale from tungsten bulbs to the latest low-wattage bulbs that cut power costs by 40pc.

No replacement has been found for neodymium that enhances the power of magnets at high heat and is crucial for hard- disk drives, wind turbines, and the electric motors of hybrid cars. Each Toyota Prius uses 25 pounds of rare earth elements. Cerium and lanthanum are used in catalytic converters for diesel engines. Europium is used in lasers.

Blackberries, iPods, mobile phones, plams TVs, navigation systems, and air defence missiles all use a sprinkling of rare earth metals. They are used to filter viruses and bacteria from water, and cleaning up Sarin gas and VX nerve agents.

Arafura, Mountain Pass, and Lynas Corp in Australia, will be able to produce some 50,000 tonnes of rare earth metals by the mid-decade but that is not enough to meet surging world demand.
New uses are emerging all the time, and some promise quantum leaps in efficiency. The Tokyo Institute of Technology has made a breakthrough in superconductivity using rare earth metals that lower the friction on power lines and could slash electricity leakage.

The Japanese government has drawn up a “Strategy for Ensuring Stable Supplies of Rare Metals”. It calls for `stockpiling’ and plans for “securing overseas resources’. The West has yet to stir.

Posted by Paul Kaye at 7:34 PM
Keywords: Getting Ready, The Economy, The World
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Monday, July 27, 2009

Boomer Factoids

From a Business Week article "The Incredible Shrinking Boomer Economy" (from a McKinsey study):

The rising savings rates in the boomer population will drain $400 billion out of consumer spending for the foreseeable future.

The boomer's were such an integral part of the spending culture that the group (79 million) accounted for 47% of national spending before the credit and real estate bubble burst, yet was responsible for just 7% of national savings.

The boomers were responsible for 78% of the spending growth in the economy from 1995 to 2005.

The peak year for spending in the boomer community was 54; whereas for the generation ahead of them (a thriftier bunch), the peak year was 47.

The share of boomers aged 54 to 63 who say they are "financially unprepared for retirement" comes to 69%.

Add to the above that interest rates and minimum payments on credit cards have risen and you can see that the life is being sucked out of one of the major drivers of consumerism. And it has been consumer that has driven the U.S. economy in the past.

As I have been saying for a while in MSIA parlance, it is going to get "interesting." This weekend I will do a longer post on why this all shouldn't matter to us.

Posted by Paul Kaye at 4:44 PM
Keywords: The Economy
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Tuesday, July 14, 2009

The Economy

Just back from New York City on the Spiritual Warrior circuit where I did a workshop/booksigning with J-R and Jsu, featuring Serving and Giving, Spiritual Warrior, and The Rest of Your Life. We'll do a reprise in London in October, by which time I hope I will get it together to give some some reportage and show some pictures on this blog.


If you still do not have a clue with what has going on with the economy this paragraph from Rolling Stone may make you feel better (well, not really):

As complex as all the finances are, the politics aren't hard to follow. By creating an urgent crisis that can only be solved by those fluent in a language too complex for ordinary people to understand, the Wall Street crowd has turned the vast majority of Americans into non-participants in their own political future. There is a reason it used to be a crime in the Confederate states to teach a slave to read: Literacy is power. In the age of the CDS and CDO, most of us are financial illiterates. By making an already too-complex economy even more complex, Wall Street has used the crisis to effect a historic, revolutionary change in our political system- transforming a democracy into a two-tiered state, one with plugged in financial bureaucrats above and clueless customers below.


The big financial debate is whether we are going to have inflation or deflation. Actually probably both as, after all, when have you known prices to go down in our lifetime? Nevertheless, the backdrop may be deflationary which, as we say in MSIA, is going to be interesting. Fortunately, it need not concern us as we practice the principles of abundance and prosperity, however it doesn't hurt to be aware of what is out there. You may find these two extracts helpful:

1) From Niels C. Jensen

The point I really want to make is that the inflation v. deflation story is the single biggest investment story right now and being on the right side of that trade will effectively secure your investment returns for years to come. If I am wrong and inflation spikes, you want to load your portfolio with index linked government bonds (also known as TIPS for our American readers), gold and other commodities, commodity related stocks as well as property.

If deflation prevails, all you have to do is to look towards Japan and see what has done well over the past 20 years. Not much! You cannot even assume that bonds will do well. Recessions are bullish for long dated government bonds but a collapse of the entire credit system is not. The reason is simple - with the bursting of the credit bubble comes drastic monetary and fiscal action. Central banks print money and governments spend money as if there is no tomorrow, and all bets are off. Equities will do relatively poorly as will property prices. But equities will not go down in a straight line. The market will offer plenty of trading opportunities which must be taken advantage of, if you want to secure a decent return.

All in all, deflation is ugly and not conducive to attractive investment returns. It is also not what governments want and need right now. With a mountain of debt hitting the streets of Europe and America over the next few years, as the cost of fixing the credit and banking crisis is financed, one can make a strong case for rising inflation actually being the favoured outcome if you look at it from the government's point of view. The problem, as the Japanese can attest to, is that deflation is excruciatingly difficult to get rid of, once it has become entrenched. I am in no doubt which of the two evils I would prefer, but we may not have the luxury of choosing our own destiny.

2) From Van R. Hoisington and Lacy H. Hunt, Ph.D.

The combination of an extremely overleveraged economy, ineffectual monetary policy and misdirected fiscal policy initiatives suggests that the U.S. economy faces a long difficult struggle. While depleted inventories and the buildup of pent-up demand may produce intermittent spurts of growth, these brief episodes are not likely to be sustained. In several years, real GDP may be no higher than its current levels. However, since the population will continue to grow, per capita GDP will decline; thus, the standard of living will diminish as unemployment rises. These conditions will produce a deflationary environment similar to the Japanese condition.

Posted by Paul Kaye at 12:08 AM
Keywords: Getting Ready, The Economy
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Wednesday, July 1, 2009


The more I read about the world and the state of its finances, all I find myself saying is thank God for the spiritual principles of abundance and prosperity with its emphasis on gratitude, grace, and connection with the Divine. From Yesterday's Financial Times:

Just why is there so much debt in the Anglo-Saxon world? Bankers and regulators know well that it is in nobody’s long-term interests to have allowed borrowing to escalate to a position where the US now owes far more, as a multiple of the economy, than at the start of the Great Depression.

The answer is capitalism’s dirty little secret: excessive lending was the only way to maintain the living standards of the vast bulk of the population at a time when wealth was being concentrated in the hands of an elite.

The amount by which the elite has benefited is startling, and illustrates the problem with lightly regulated free markets: the rich get much richer while the rest do not get richer at all. According to Société Générale economists, the inflation-adjusted income of the highest-paid fifth of US earners has risen by 60 per cent since 1970, while it has fallen by more than 10 per cent for the rest. As was recently pointed out in the New York Review of Books, the Walton family, of Wal-Mart fame, is wealthier than the bottom third of the US population put together – about 100m people.

Posted by Paul Kaye at 9:52 PM
Keywords: The Economy
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Tuesday, June 30, 2009

Demographic Collision Course

Great summary from Nielsen on the the demographic collision course we are on. Best parts below. If it is any comfort, it's a lot worse for Japan and China in the years ahead.

The recession of 2007–2009 has placed a great deal of strain on marketers and retailers of consumer products. Price and value have become more and more important, challenging marketers to rethink product and distribution. Everyone just wants things to get back to normal, but will they? While discretionary spending will return to moderate levels as markets rebound, the economy of the United States—as well as the rest of the more developed World—is well on the road to longer-term difficult times. The economic hard times to come do not stem from the misuse of arcane investment instruments that can take a degree in calculus to understand, but rather from simple demographics. The emerging marketplace will be very different than today, and filled with wide-ranging challenges.

Since the early 1970s, birth rates in the United States have been at least 40% lower than at the heights of the Baby Boom. When a falling birth rate is combined with a very large generation like the Baby Boom, the effect is a gradual aging of the population. The median age of the population increases as the large group grows older because there aren’t enough babies being added to balance them out. For much of the large group’s life cycle, they are typically a boon to the economy—especially when they reach their prime economic productivity years (usually from the early 40s into the middle 50s). However, as this large group continues to age, they stop being an economic asset and begin to become a burden—as the Baby Boom generation will become over the next several decades.

Aging populations place stress on an economy in two ways. First, if the generation is sufficiently large, retirement can lower the size of the labor force—particularly its most skilled and most experienced component—lowering overall economic productivity. Starting in the next two years until 2030, the number of persons who reach the retirement age of 66 will increase by over 100,000 each year throughout the Baby Boom retirement years. For many of the early years in that period, the number of persons who reach the age of 19 and enter the labor force will actually decline by more than 40,000 per year for the next decade.

The second impact of an aging population is perhaps larger—the costs incurred by society to care for a large number of retirees. Social Security will begin to run at a deficit in about eight years and will deplete its trust fund by 2041 unless changes are made now. At that point, money coming into the program would only cover about 70% of the money paid out each year. Medicare and Medicaid will deplete their trust funds in only about ten years and will be the largest component of all U.S. government spending by 2030.

Additionally, many private pension plans are currently under-funded, and given the current economic difficulties, may not have time to recover adding more people to the public dole. The Baby Boom generation has suffered a disproportionate share of the $11 trillion in lost market equity and $3 trillion in lost real estate value from the current recession and they will find it near impossible to retire and sustain their current standard of living—particularly the 38% who will be eligible to retire in the next ten years.

Posted by Paul Kaye at 1:55 PM
Keywords: Getting Ready, Retirement, The Economy
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Tuesday, June 16, 2009

Three Important Trends

Number One

Last year, for the first time ever, the developing world consumed more energy than the developed. And this year, the US, Canada and Europe will generate less than half of global economic output, according to the Centre for Economics and Business Research. The emerging markets have come of age. We now need some new tag to describe an admittedly vast region that in many respects has better fundamentals than the West: better growth prospects; larger foreign reserves; less sovereign indebtedness; better GDP per capita growth; a stabler banking system; superior household finances and savings rates. Resurging markets, perhaps ?

Tim Price PFP Wealth Management Newsletter


Number Two

American children have it easier than most other children in the world, including the supposedly lazy Europeans. They have one of the shortest school years anywhere, a mere 180 days compared with an average of 195 for OECD countries and more than 200 for East Asian countries. German children spend 20 more days in school than American ones, and South Koreans over a month more. Over 12 years, a 15-day deficit means American children lose out on 180 days of school, equivalent to an entire year.

American children also have one of the shortest school days, six-and-a-half hours, adding up to 32 hours a week. By contrast, the school week is 37 hours in Luxembourg, 44 in Belgium, 53 in Denmark and 60 in Sweden. On top of that, American children do only about one hour’s-worth of homework a day, a figure that stuns the Japanese and Chinese.

Americans also divide up their school time oddly. They cram the school day into the morning and early afternoon, and close their schools for three months in the summer. The country that tut-tuts at Europe’s mega-holidays thinks nothing of giving its children such a lazy summer. But the long summer vacation acts like a mental eraser, with the average child reportedly forgetting about a month’s-worth of instruction in many subjects and almost three times that in mathematics.

The Economist


Number Three

From Paul Kedrosky:

There is an important story in England’s Daily Telegraph about the increasing likelihood that some economically devastated U.S. cities may have to be partially bulldozed in order to survive. With cities like Flint, Michigan, having lost much of their rationale for existence, this should not come as a complete surprise. Nevertheless, this will be a difficult pill for "things will come back" America to swallow.

The government looking at expanding a pioneering scheme in Flint, one of the poorest US cities, which involves razing entire districts and returning the land to nature.

Local politicians believe the city must contract by as much as 40 per cent, concentrating the dwindling population and local services into a more viable area.

The radical experiment is the brainchild of Dan Kildee, treasurer of Genesee County, which includes Flint.

Having outlined his strategy to Barack Obama during the election campaign, Mr Kildee has now been approached by the US government and a group of charities who want him to apply what he has learnt to the rest of the country.

Mr Kildee said he will concentrate on 50 cities, identified in a recent study by the Brookings Institution, an influential Washington think-tank, as potentially needing to shrink substantially to cope with their declining fortunes.

Most are former industrial cities in the "rust belt" of America's Mid-West and North East. They include Detroit, Philadelphia, Pittsburgh, Baltimore and Memphis.

In Detroit, shattered by the woes of the US car industry, there are already plans to split it into a collection of small urban centres separated from each other by countryside.

"The real question is not whether these cities shrink – we're all shrinking – but whether we let it happen in a destructive or sustainable way," said Mr Kildee. "Decline is a fact of life in Flint. Resisting it is like resisting gravity."

Karina Pallagst, director of the Shrinking Cities in a Global Perspective programme at the University of California, Berkeley, said there was "both a cultural and political taboo" about admitting decline in America.

"Places like Flint have hit rock bottom. They're at the point where it's better to start knocking a lot of buildings down," she said.

Flint, sixty miles north of Detroit, was the original home of General Motors. The car giant once employed 79,000 local people but that figure has shrunk to around 8,000.

Posted by Paul Kaye at 7:26 PM
Keywords: Getting Ready, The Economy, The World
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Thursday, April 16, 2009

Good Common Sense

God did not put you on this planet to be a beggar. God put you here and said: You are the prince of the throne and an heir to all powers, principalities, and kingdoms. I will give you the Light. I will sustain you forever, and all you have to do is come back to Me.

--John-Roger, DSS


Please read this good common sense from the excellent Nassim Nicholas Taleb in a recent Financial Times article:

People who were driving a school bus blindfolded (and crashed it) should never be given a new bus. The economics establishment (universities, regulators, central bankers, government officials, various organisations staffed with economists) lost its legitimacy with the failure of the system. It is irresponsible and foolish to put our trust in the ability of such experts to get us out of this mess. Instead, find the smart people whose hands are clean.

Do not give an addict more drugs if he has withdrawal pains. Using leverage to cure the problems of too much leverage is not homeopathy, it is denial. The debt crisis is not a temporary problem, it is a structural one. We need rehab.

Finally, this crisis cannot be fixed with makeshift repairs, no more than a boat with a rotten hull can be fixed with ad-hoc patches. We need to rebuild the hull with new (stronger) materials; we will have to remake the system before it does so itself. Let us move voluntarily into Capitalism 2.0 by helping what needs to be broken break on its own, converting debt into equity, marginalising the economics and business school establishments, shutting down the "Nobel" in economics, banning leveraged buyouts, putting bankers where they belong, clawing back the bonuses of those who got us here, and teaching people to navigate a world with fewer certainties.

Then we will see an economic life closer to our biological environment: smaller companies, richer ecology, no leverage. A world in which entrepreneurs, not bankers, take the risks and companies are born and die every day without making the news.

Posted by Paul Kaye at 7:12 PM
Keywords: Basics, God, The Economy
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Wednesday, April 15, 2009

Bits and Pieces

Human character is revealed in how we live our lives. It is revealed by what we devote our lives to and how much love we put into what we do.

--Jean Giono


Quote of the Day:

Now I am not a professionally trained economist or banker, merely a historian of the reasons why Great Powers seem to have risen over time, and then steadily collapsed some generations later. Yet it appears to my non-scientific mind that if a particular national government decides on the one hand to issue more and more Treasury debt, and on the other hand to have its national bank purchase large amounts of the same, it runs a serious risk of scaring investors about its long-term credit- worthiness.

--Paul Kennedy


Interesting fact from Richard Russell of Dow Theory Letters:

It takes a fertility-rate of 1.5 in order for a nation to maintain a stable population. No nation in Europe has a fertility rate as high as 1.5. Japan is drying up; it's become a nation of geriatrics.

The nation with the lowest fertility rates are Poland, Ukraine, South Korea, Belarus, Hong Kong, Macau.

The highest fertility rates are in Mali, Niger, Uganda, Somalia, Afghanistan, Yemen, Burundi.


For those of you following my Middle Game series of posts (under Getting Ready on the right hand side), this article may be of interest under The Battle for Influence. Excerpt:

Beijing has bolstered its presence without bombast, perhaps out of an awareness that its relationship with the United States is still of paramount importance. But this deference may not last.

“This is China playing the long game,” said Gregory Chin, a political scientist at York University in Toronto. “If this ultimately translates into political influence, then that is how the game is played.”


And finally, this is a lesson in how abundance comes in many guises. (it's become so popular they didn't allow me to embed the actual video so here is the link):

Posted by Paul Kaye at 10:41 PM
Keywords: Abundance, Getting Ready, Humor, Joy, The Economy
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Wednesday, April 8, 2009

More on Gratitude

More on gratitude. Check out this lovely article (Hat tip to Deborah). Excerpt:

There may be a positive byproduct of our troubled times: a decrease in the urge to complain. People who still have jobs are finding reasons to be appreciative. (It feels unseemly to complain about not getting a raise when your neighbor is unemployed.) Homeowners are unhappy that home values have fallen, but it's a relief to avoid foreclosure. And yes, our portfolios have plummeted, but most of us can say that at least we didn't invest with Bernie Madoff.

There is also a growing "noncomplaining" movement that touts the belief that whining doesn't work as a strategy, and that happiness can be found through rituals such as writing in "gratitude journals."

Will Bowen, a minister in Kansas City, Mo., is on a mission. His nonprofit organization, A Complaint Free World Inc., has distributed almost six million purple bracelets emblazoned with the group's name. When wearers find themselves complaining, they're asked to switch bracelets to their other wrists. The goal is to go 21 days without having to switch.


I've been a bit bemused by the amount of financial support that the Government has given the banks. I understand that it is being done to prevent the financial system from collapsing but it does bring to mind the idea that doing the same thing over and over again and expecting a different result is what is known as being crazy.

After sitting with this for quite a while I am now of the opinion that this solution is really no solution at all. Then what is the solution? I think the best thing is to allow things to fail that are not working--not as a punishment but because strength and creativity are born out of adversity and limitation. It seems to me that this path of spending beyond our means will become a burden to future generations and will feel like a punishment not of their making. I guess they are the ones that will grow strong and be creative.

Just a few thoughts.

Posted by Paul Kaye at 5:03 PM
Keywords: Gratitude, The Economy
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Wednesday, March 4, 2009

On the Mark

Short post today with two excerpts that succinctly express my current thoughts and sum up this blog. I'll be expanding on these themes when I get some time. I want to do a big post on the big picture using the game of Go as a metaphor.


From IIWP:


Can we have inner peace and connection with our hidden treasures and still maintain a balance of abundance in this physical world? Yes -- and it isn't always easy.

Even with all the hidden treasures becoming
available to you, in order for you to have material things, you may still have to go into the world, strive, and labor. The trick is to remember to keep going in and out.

That is the key: Go in and connect to that place where everything is full, content, and peaceful; then, with that joy, go out and share your loving
consideration, wisdom, and balance.

- John-Roger, Founder Institute for Individual and World Peace®

(From: Wealth & Higher Consciousness)


From Richard Russell of Dow Theory Letters:

Bear markets exist for the purpose of correcting the faults and scams and greed and inefficiencies that grew out of the preceding bull market. That's not what's happening in the US now. The losers and inept are being saved with massive infusions of cash. Bank presidents who allowed their banks to load up with fraudulent mortgages are given bonuses, corporations who couldn't learn to compete are being saved from bankruptcy, executives whose stocks are in the single digits are being rewarded and given outrageous golden parachutes or monster bonuses. Where's the accountability?

I just read where 92 tapes made by the CIA interrogating prisoners have "disappeared." Who gave the orders for those tapes to be destroyed? Who is the individual? Who is accountable? What's his name? Is anyone accountable for anything these days?

And what about the inept SEC which ignored report after report on Bernie Madoff's massive fraud? Was anyone at the SEC fired? Was anyone responsible at all? Where's the accountability?

Posted by Paul Kaye at 5:01 PM
Keywords: The Economy
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Monday, March 2, 2009

Changing Times

It is no longer enough to be smart -- all the technological tools in the world add meaning and value only if they enhance our core values, the deepest part of our heart. Acquiring knowledge is no guarantee of practical, useful application. Wisdom implies a mature integration of appropriate knowledge, a seasoned ability to filter the inessential from the essential.

--Doc Childre and Bruce Crye

(From CharityFocus.org)


In case you missed it, I loved this comment on the site from Nathalie:

As I used to have the habit of spending too much money JR once told me in a reading that before I spent anything to ask the question, "How will this increase my spiritual awareness?"

I spent much less after that comment.


More madness. From Joe Nocera of the New York Times:

The federal government is also likely to announce — yet again! — a new plan to save A.I.G., the third since September. So far the government has thrown $150 billion at the company, in loans, investments and equity injections, to keep it afloat.

A.I.G. is going to cost taxpayers at least $100 billion more before it finally stabilizes, by which time the company will almost surely have been broken into pieces, with the government owning large chunks of it.

A quarter of a trillion dollars, if it comes to that, is an astounding amount of money to hand over to one company to prevent it from going bust. Yet the government feels it has no choice: because of A.I.G.’s dubious business practices during the housing bubble it pretty much has the world’s financial system by the throat.

Other firms used many of the same shady techniques as A.I.G., but none did them on such a broad scale and with such utter recklessness. And yet — and this is the part that should make your blood boil — the company is being kept alive precisely because it behaved so badly.


I was fascinated by this post from Seth Godin. Talk about a sign of the times! This couldn’t have happened even 5 years ago.

A friend advertised on Craigslist for a housekeeper.

Three interesting resumes came to the top. She googled each person's name.

The first search turned up a MySpace page. There was a picture of the applicant, drinking beer from a funnel. Under hobbies, the first entry was, "binge drinking."

The second search turned up a personal blog (a good one, actually). The most recent entry said something like, "I am applying for some menial jobs that are below me, and I'm annoyed by it. I'll certainly quit the minute I sell a few paintings."

And the third? There were only six matches, and the sixth was from the local police department, indicating that the applicant had been arrested for shoplifting two years earlier.

Three for three.

Google never forgets.

Of course, you don't have to be a drunk, a thief or a bitter failure for this to backfire. Everything you do now ends up in your permanent record. The best plan is to overload Google with a long tail of good stuff and to always act as if you're on Candid Camera, because you are.

Posted by Paul Kaye at 7:07 PM
Keywords: The Economy
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Friday, February 27, 2009

Reality Check

How, then, do we live in this world?
How can we gain? What can our goal be?

For God's sake, don't have a goal in this world.
It's going to beat you bloody.

Where is the goal? The goal is inside.

When you turn back inside, you have your goal, you have your completeness, you have your fullness and you walk through the world, having all else added unto you.

(From The Tao Of Spirit by John-Roger, DSS)


Good stuff from author and historian Niall Ferguson today. Some excerpts below but the whole interview is definitely worth a read here.

“...this isn't a recession. This is something really quite different in character from anything we've experienced in the postwar era. That's why these projections give positive numbers for 2010. That's the default setting. And it just seems to me ostrich-like, to bury one's head in the sand and assume this has to end this year because, well, that's what recessions do.

“It's obvious, surely we know by now, that this is something quite different. It's a crisis of excessive debt, the deleveraging process has barely begun, the U.S. consumers are not going to suddenly bounce back and hit the shopping malls just because they get a tax cut. The savings rate is going to continue to rise. These processes have tremendous momentum that quite clearly differentiates them from anything that we've seen, including the early 80s, including 73, 74, 75. Those big crises, the ones that we have lived through, were bad. But this one seems certain to be deeper, and more protracted.

“The truth about the crisis is that it is in large measure psychological. We're not dealing here with mathematics. We're not dealing here with human beings as calculating machines. We're dealing with real people whose emotions influence their individual decisions, and the swing from greed to fear is a very spectacular thing when it happens on this scale.

“I've been talking a while about this being the Great Repression. It took ages, ages, for people to realize this thing had fallen apart.”


And this from Blackstone’s Steve Schwarzman via Paul Kedrosky matches my perspective:

“Our view is the economy will continue to deteriorate sharply and then I think you will have a weak 2010 although I don’t think it will keep declining…I think 2011 will show some growth but still be well below the levels of 2006 and 2007. My own view is you may not get back to 2006 and 2007 for a long time because we have sort of an emotional and psychic shift going on in America which is back to basics, don’t live on leverage, live within your means, more humble life styles, less extravagant consumption, savings, and all of that sort of stuff.

“I believe that a lot of people in America are legitimately scared and have seen their life savings or what they perceived as their net worth largely either wiped out or cut in half. That’s going to forge fundamental behavioral differences and that will retard the growth.”

Posted by Paul Kaye at 11:14 PM
Keywords: Money, The Economy, The World
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Friday, February 20, 2009

In the Midst of the Meltdown 5

Shape clay into a vessel;
It is the space within that makes it useful.



It is within the no-thing that the Spirit lives.

The Spirit will not come into a space that is already filled.

If you are filled with anxiety, fear, depression, and disturbance, there is no space for the Spirit.

And since the Spirit cannot violate your consciousness, it must stay outside.

When you give up the negative emotions and expressions, the space that is left can be filled by the Spirit.

But you must create the space.

You have to risk letting go of the things that do not work for you in order to gain the things that will.

(From the Tao of Spirit by John-Roger, DSS)


We are certainly living in interesting times. Please be aware of what is going on around you. It will change the course of the planet for generations. For example, capitalism. The U.S.A. is the great bastion of capitalism. Make that "was." And all in the last month or two. We are seeing that if an inefficient auto maker fails it is bailed out by the government. If a large, corrupt financial institution over extends itself through greed and stupidity, it is bailed out by the government. If a person spends too much money on a house they could never afford and are behind on their payments, they too are now being bailed out by the government. And who is really bailing them out? The people who run their businesses efficiently, who make their house payments on time and who are honest and pay their taxes. This is the new face of capitalism, and what you are seeing, first hand, is an abysmal failure. It is a historic moment. Really. You have a front row seat on what is likely to be an ongoing great world social upheaval.


If you still can't get your head around what has taken place and all the terms like Credit Default Swaps and CDO's and things like that then this 11 minute video is a must see. It is about the clearest explanation I have found. Please educate yourself.

The Crisis of Credit Visualized from Jonathan Jarvis on Vimeo.

Posted by Paul Kaye at 9:50 PM
Keywords: Letting Go, The Economy, The World
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Thursday, February 19, 2009

Time to Seed

Go figure!

California finally got its budget together. Here are the highlights:

It included billions of dollars in cuts to schools, healthcare institutions, higher education and programs for the poor. If signed by Schwarzenegger, who helped devise the package, it also would raise personal income taxes and the state sales tax, although a 12-cent per-gallon increase in gasoline taxes was eliminated in the final hours.

Most of California’s expenses are compensation paid to current or former government employees.

I am not speechless, but I do not have anything positive to say.


Some of the news has become so negative that people have become addicted to it. A new term has entered the lexicon—pessimism porn. I think there is something in human nature that envisions apocalyptic events. I am not inclined that way, although I must acknowledge that the events around the world in the last century from the concentration camps, gulags, and killing fields, etc., must have seemed that way to the people involved. Nevertheless, there is still so much to be grateful for, and I believe that the essential goodness of human nature will come through and triumph in these times.

Along with this is another aspect of human nature which tends to think that a trend is everlasting. When the Dow was at 12,000 someone wrote a book entitled Why the Dow will Go to 35,000. It closed at a new low today around 7,200. When oil was at $125, Goldman, Sachs predicted it would go to $200. It closed around $35 today.

Now that we are in a economic downtrend there is a tendency for people to see it going all the way to the depths of hell. And of course for some people hell is not being able to buy what they want to.

For a good laugh at it all see this 4 minute clip from comedian Louis C K on The Conan O’Brian Show.


Which brings us to: It’s time to seed. Here is some inspiration for you.

When you seed, you need to do it with the real faith of the heart. You have to claim what you seed for, but you have to claim it in God’s time and love.

You state what you want very clearly. Then you claim it as already being here, which is conditioning the consciousness. To receive, you need to act as though you have it; this is the faith statement that it is already present.

Faith seeding is powerful. The faith is claiming that you will receive prior to it coming to you. Faith is also basking in gratefulness for the grace of Divinity showered on you because you have seeded. And you did it joyfully.

(John-Roger DSS from God Is Your Partner)

Posted by Paul Kaye at 5:37 PM
Keywords: Seeding, The Economy
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Tuesday, February 10, 2009

The Essence of Abundance

You don’t possess your breath, nor do you possess the air around you as a form. Yes, you do need it, yet when you take a breath in, there is no longer a need because it is present within you. When you find the essence of love within you and then seek a form for it, in a person, a marriage, or a family, you are taking your mental identification, putting your energy on it, pushing it out into the world, and seeking the form that will somehow match the essence you have experienced inside of yourself. It will never match. You may get the form, but you’ll never get the essence by searching for it in the form. And that’s why the form will never satisfy. It can never, ever, be enough. But the essence is perfectly plentiful.

To precipitate goodness (Godness) in your life, move always to the essence. Successful manifestation is moving the goodness from the Soul, through the intuition, and into the consciousness. Intuitive knowing is a process of Soul. It is a process of moving beyond form to the essence behind it and knowing the essence.

The essence of the Soul is abundance. Spirit is naturally abundant because it is the substance from which all things are created. There is nothing that is not Spirit. To be abundant from the Soul level does not mean having access to many things; it means having access to the essence of all things and being in communion with the one essence. When you are in that divine communion, you never feel lack. So if you want to experience true abundance, practice divine communion.

(From The Rest of Your Life by John-Roger, DSS with Paul Kaye)


Financial Quote-of-the-day 1:

From James Surowiecki on the Treasury Secretary’s bailout plan speech today after which he stock market tanked:

I understand, as Tim Geithner mentioned, that acting sooner rather than later is the right thing to do in financial crises. But saying that you’re going to act isn’t the same thing as acting. We needed the latter, and instead we got the former.


Financial Quote-of-the-day 2:

From Paul Kedrosky on Congress suddenly becoming experts on financial matters:

I’m as upset at the Fed, Treasury, and Wall Street as the next semi-sane person, but Congress pisses me off too. Just try to watch today’s hearings with too many House and Senate members getting basic terminology wrong (“default credit swaps”?); implying that people without money in a brokerage account aren’t dependent on financial markets; confusing income statements and balance sheets; babbling in a fact-free way about a return to the gold standard; and so on.

It’s so, so, so discouraging that these politicians are on the signing side of centi-billion dollar checks flowing into the financial system. We need emergency remedial financial training for all these elected lawyers before they make the current mess much, much worse.


Financial Quote-of-the-day 3:

This Report by JETROS (Japan External Trade Organization) makes an interesting point that I have been meaning to post about for a few weeks. It’s about the influence that baby-boomers have had on past spending patterns, and the much reduced influence they will have in the future:

Public works projects are likely to rise in importance as actions by the Federal Reserve and Treasury Department may not prove sufficient to stimulate demand as aging US baby-boomers and other households focus on paying down debt rather than the consumer spending that has driven growth in the past.

As Merrill Lynch economist David Rosenberg states in a recent report titled "The Frugal Future", "The median (US) boomer is moving into his 50s. After a buying boom over the past 20 years that has seen the level of non-housing durable goods assets on the consumer balance sheet almost triple to nearly $40,000 per household, it looks as though the boomers are done. For the first time in four decades, we cannot expect to see the demographic cushion to consumer spending that helped ease the blow in each of the recessions dating back to the 1970s."

Posted by Paul Kaye at 5:55 PM
Keywords: Abundance, Manifestation, The Economy
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Monday, February 9, 2009

True Manifestation

Manifestation is successful only if it results in a change of consciousness. That’s a little different from how most people see it. Manifestation has usually been defined as the ability to make something appear physically. But if you only take into account the materialization of a physical form, you have missed the essence of creation. When manifestation results in a change of consciousness, you no longer need to see the form in the outer world, but you move to the very essence of its fulfillment inside of you and then you truly have it. Truly having something does not mean you possess it as a form, but that it is present for you in its essence.

(From The Rest of Your Life by John-Roger, DSS with Paul Kaye)


I mentioned over the weekend the emerging trend of peer-to-peer lending. Another emerging trend in these times is Community Supported Agriculture. In both cases the meta-trend is distrust and lack of confidence in the regular supply chain. Richard Russell of Dow Theory Letters commented on this today:

We get all of our fresh vegetables through a CSA program, CSA is an abbreviation for community supported agriculture. Essentially a group of consumers pay up-front at the beginning of a growing season for a small (usually family) farm's start up costs. Its like a share, the dividends arrive every Wednesday in the form of a box brimming with seasonal produce--all organic vegetables and fruits at a very reasonable price. There are even meat CSAs now. Check out the CSAs in your area. Faye and I are members of Bee Wise and they usually give us so much food we have a problem finishing all of it.


I found this interesting from Strategic Forecasting:

Ultimately, the issues dividing the world are not, in our view, subject to personalities, nor does goodwill (or bad will, for that matter) address the fundamental questions. Iran has strategic and ideological reasons for behaving the way it does. So does Russia. So does Germany, and so on. The tensions that exist between those countries and the United States might be mildly exacerbated by personalities, but nations are driven by interest, not personality.

Biden’s position did not materially shift the Obama administration away from Bush’s foreign policy, because Bush was the prisoner of that policy, not its creator. The Iranians will not make concessions on nuclear weapons prior to holding talks, and they do not regard their support for Hamas or Hezbollah as aiding terrorism. Being willing to talk to the Iranians provided they abandon these things is the same as being unwilling to talk to them.


PK: My point in posting the above excerpt is to show that some things are changing rapidly and some things barely at all. Do not look to the Government for help because it is still basically the same people with the same agendas playing them out in the same way. It is really a time for taking personal responsibility. There will be change, we just don't know what. So stay healthy and flexible.

Of the reading I have recommended over the last few days, this one quote stands out:

I don't care how hard this period is. You have to have the combination of believing that you will prevail, that you will get out of this, but also not be the Pollyanna who ignores the brutal facts. You have to say that we will be in this for a long time and we will turn this into a defining event, a big catalyst to make ourselves a much stronger enterprise. Our characters are being forged in a burning, searing crucible.

--Jim Collins

Posted by Paul Kaye at 6:52 PM
Keywords: Health, Manifestation, The Economy, Values
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Saturday, February 7, 2009

Essential Weekend Reading 1

I read a lot and I try in this blog to synthesize for readers, eliminating the technical stuff, what they need to know to navigate through these fascinating times. Of course it is all meaningless if a person is not living the spiritual principles of abundance and prosperity. In fact, if you are you can pretty much ignore what is below.

John Maudlin has been an excellent resource of information. For more information on him and how to get his excellent free newsletter see the end of the excerpts below.

The excerpts below are from John’s newsletter today. He is not a fanatic. He is a very sober individual that I have followed for several years and has managed to accurately call the economic ups and downs in an accessible, intelligent way. I have combed through the newsletter and extracted these highlights:


When confronted about an apparent change of his opinions, John Maynard Keynes is reported to have said, "When the facts change, I change my mind. What do you do, sir?"

The facts have changed. The reality is that we are in a much worse recession than I thought it would be two years ago. Let's look at a likely set of facts, in no particular order.

1. Consumers are going to save more and spend less. It is likely that US consumers are going to push the savings rate back up to 6% (or more). Total US net worth decreased by $7.1 trillion through the third quarter of 2008, from housing and stock market losses. Greg Weldon speculates that is could easily be $15 trillion by the end of the cycle. That is a massive amount of wealth destruction. This is a truly global recession. Economists say that anything below 2.5% in world growth is a global recession. We are down to 0.5% and falling.

2. The stimulus package is simply a pork-laden, misguided piece of legislation. There is way too much spending on items that have very little current effect on the economy.

I am in principle in favor of a deep and large stimulus package. We need one, but what is on tap is not what will stimulate real job growth. All it does is create more debt that will have to be paid later by our kids.

3. I am somewhat more hopeful about the Federal Reserve and Treasury programs, although all they really do is buy time for financial corporations to heal themselves. That is not all a bad thing, though. Volker did it in the early 1980s by allowing banks to carry debt from Latin American countries that was in default at full loan value. Otherwise every major bank in America would have been bankrupt.
And I agree that a lot of the process will be wasteful and unproductive. But such is the nature of crisis planning.

4. As I have noted for almost two years, it will take until at least 2011 for the housing market in the US (and bubbles elsewhere, as in England and Spain, etc.) to stabilize. It will take several years for the creation of a new credit system to rationally replace the old "shadow banking system." This is why the recovery will take so long.

For an economy to grow over time, you need some combination of increasing population, productivity increases, and credit creation. We have destroyed a large part of our credit creation model (which was deeply flawed, even though for awhile it seemingly worked well) here in the developed world, and simply have to build a new one. That is why I believe we are going to see the creation of a massive new Private Credit Market that will compete with banks.

5. The US government will run multi-trillion-dollar deficits for at least two years. As noted above, I think the current stimulus package will not be deemed sufficient by the third quarter, and the compelling need politicians will feel to do more will be almost uncontrollable.

Interestingly, the increase in federal spending is going to be accompanied by a substantial decrease in state and local spending, as almost all nonfederal entities must balance their budgets, and tax receipts are way down. If consumers are spending 5% less, it stands to reason sales taxes are down by 5%. Property taxes will be down, as will the state portion of income taxes. Increasing taxes will bring about local voter rebellion, so spending cuts will be the order of the day. As an example, state employees in California have every other Friday off, which cuts their pay by 10%. Expect more such cuts everywhere and on everything.

And while I am on the subject, state, county, and municipal pension plans are woefully underfunded. As in by trillions of dollars. The signs were so there, and in a few years governments are going to have to figure out how to deal with major shortfalls in funding, as many municipal pension plans will be technically bankrupt.

Accompanying the increase in federal spending will be a real decrease in federal tax receipts, which will make the deficits worse.

6. The main driver in the economic world is deflation, as I have been writing for a long time. Yes, we had a brief whiff of inflation last year, but that was primarily commodity-driven, and that force is now spent. Commodities are likely to rise in price again, but not in the near future.

This is going to give the Fed the room to print money to monetize the federal deficit, and indications are that Bernanke will do it with a vengeance. He will do everything in his power to keep the US economy from catching "Japanese Disease," that is, descending into a deflationary spiral.

We are in a period where the economy is going through what economists call rationalization. We are going to have to reduce the number of retail stores, coffee shops, automobile plants, fast food restaurants, car dealerships, etc., until we get to a level that makes rational sense for the size of the economy. We just built too much stuff, launched too many stores, and created too much capacity for almost everything.

The idea for the business person today is to still be standing when we get through this, as we will. That is what free market economies do. The day will come when we get back to growth. But it will be a rational growth based in real fundamentals, one that will last a long time. So hope is not a business strategy. You need to be planning for a lengthy recession and a slow recovery.

John Mauldin, Best-Selling author and recognized financial expert, is also editor of the free Thoughts From the Frontline that goes to over 1 million readers each week. For more information on John or his FREE weekly economic letter go to: http://www.frontlinethoughts.com/learnmore

Posted by Paul Kaye at 12:17 PM
Keywords: The Economy
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Wednesday, February 4, 2009

Cats and Cool

God is intention. When you tithe you make God your abundant focus. God’s intention is in that focus, so God will know right whereto find you.

(From God Is Your Partner by John-Roger, DSS)


If you have money to invest and you are confused as to the best place to put it, you are not alone. Richard Russell of Dow Theory Letters gives as good a summary below as I have seen:

So what's the answer to the current unprecedented situation? What should you and I do?

Don't be married to any specific scenario. Anything may happen in response to the current situation.

The best survival plan is to be diversified. Nobody knows who or what will be "the last investment standing." Will it be Treasury paper, high-grade bonds, real estate, diamonds, T-bills, cash, top-grade corporate stocks or gold?

T-bills are the choice of many sophisticated investors. But T-bills are denominated in dollars, and dollars are vulnerable as are bonds or any other items denominated in Federal Reserve notes ("dollars").

Real estate and diamonds represent intrinsic wealth, although they are not instantly liquid, meaning that they cannot be instantly turned into cash.

Gold has been accepted as wealth for thousands of years. When all other forms of supposed wealth crashes (deflates) or becomes suspect, the last wealth asset to stand will be gold. Gold has no counter-party nor has it any debt aligned against it. Gold needs no central bank to ensure its acceptance. Gold is accepted everywhere and in any quantity as a form of indestructible, eternal wealth.

Gold's problem is that it must compete with the fiat paper that is manufactured by the world's central bankers. Gold is the bankers' enemy. Nevertheless, for survival purposes, it makes sense for every investor or family to own at least a small (10% of assets) position in gold. Remember, you don't own gold in the hope of a potential profit, you own gold as a store of wealth -- as a safe haven asset.

Today, investment money is so suspicious of the viability of any given asset that they are placing their money in an item that bears the full faith and credit of the US government -- I'm referring to Treasury paper. The shortest-maturity is the 91-day T-Bill, yielding literally nothing. Yet if one places one's money in a T-bill, it is thought that this is as safe a place for storing wealth as you will find. Actually, one major worry with T-bills is a possible collapse of the dollar.


My own point of view regarding the above is to not try and be an investment genius. Just do your best to preserve your hard earned money without risking it unnecessarily. The biggest losses I have seen people make were those where they tried making high returns. Of course, some succeed. But the real "successes" were the financiers/money managers who just took their percentages off the top regardless if the investment did well.


I love Tim Price of PFP Wealth Management. Here are excerpts from his latest newsletter where he writes an open letter to the Western banking establishment. It's hilarious and scathing.

I would also be grateful if the strategists and economists who work for you could abstain from publishing their unsolicited opinions about resolving the banking crisis within the financial media. I am sure you will agree that hearing from the same strategists who worked for the architects of such widespread financial destruction is likely to irritate those of us who were not actually complicit in the extraordinary and venal credit boom of the last several decades. There is an expression that if you're not part of the solution, you're part of the problem. Those of your employees who were the public face of the problem are, I think you will agree, unlikely to represent the solution, unless perhaps they are fired - en masse, from a giant howitzer, into an area where they can do no further harm. Alaska, perhaps. I would further suggest that the high profile commentators who work for you and who have implicitly played their part in marketing and then amplifying this catastrophe might consider quietly entering another field with superior ethics and enhanced value to society at large: perhaps as piano players in brothels.

Perhaps you, like I, find it richly ironic that members of the public still use your investment subsidiaries as a means to protect and grow their private wealth. I think you should promote the activities of these subsidiaries more widely. My idea for an advertising slogan: “When it comes to moral hazard, we’re Number One. We helped trigger the biggest financial and economic collapse in history through our imprudent lending and investment. Between 18 million and 30 million jobs throughout the world are almost certain to be lost. And more than 50 million jobs throughout the world are now in jeopardy. As a result of our investment expertise, we’ve lost billions, and those of us that still exist and aren’t owned by the taxpayer are technically insolvent. Now, how can we help you with your finances ?”


Regarding the last point above I have been reading Barron's roundtable of experts as they make their financial predictions the coming year. They are twelve of the most erudite financial minds you are like to find gathered in one place with the most astute observations. Then you read how they did last year and find that they ALL lost gobs of money--most over 50% and some 80%.

My point is don't be ashamed of feeling ignorant. No one really has a handle on our current situation. Just do your best and follow the spiritual principles of abundance and prosperity.


And if you are a cat lover then forget about all the financial woes and look at these superb photos. (Thanks to Betsy for this).


When I first mentioned frugal living I got feedback that this was "poverty consciousness." Well, in yesterday's Financial Times I found this:

Toyota, the world’s largest carmaker concluded recently that in the US “frugalism is the new cool.” according to Bob Carter, brand head in the country.

It feels good to be cool.

Posted by Paul Kaye at 2:55 PM
Keywords: Frugal Living, Money, Success, The Economy, Tithing
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Monday, February 2, 2009

Flying High

Tithing is something you give unconditionally, and once you let go, it’s like cutting the string of a kite. It’s gone.

But this kite flies high and eventually reaches God's attention, and in God's attention all the goodness that you want will start coming your way, like health and wealth and happiness and more good things than I could ever imagine to tell you.

(from God Is Your Partner by John-Roger, DSS)


When you follow the spiritual principles of abundance and prosperity there is much cause for optimism, as the above quote shows. You walk blessed among humankind. It’s a wonderful thing.

And of course we must always keep our eyes open and live a practical life. As we face an economy and a world that has changed and will continue to change, I find my primary anchor point (my security) with the Beloved. I also find security in my values. They have been an enormous source of strength and they guide my actions both in the way I conduct my life and in my spending habits.


I agree with Tim Price below that we have all been complicit in what has taken place.

From Tim Price, published by PFP Wealth Management:

"Banks have done more injury to the religion, morality, tranquility, prosperity and even wealth of the nation, than they ever will do good.”

--US President John Adams, 1799.

"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning."

--Henry Ford.

The scale of the banking crisis is so huge, and the dislocating damage wrought across all financial assets so extensive, it challenges language and thought just to try and articulate it. But one response has been almost universal: having been monumentally cheated, we demand an apology. Yet answer comes there none.

The lack of contrition may have something to do with the breadth and diffusion of the guilt. Since a housing and credit bubble also requires the willing participation of a greedy and credulous public, there are really few people who emerge entirely untainted from the wreckage. By and large, we are all complicit. What matters is how we reach resolution.


This is interesting because so many people are predicting the demise of the dollar.

From Stratfor:

Underlining all aspects of the recession will be a single, undeniable fact. The dollarization of the global economy that began so torrentially in 2008 will reach a fever pitch in 2009 as a variety of investors — private, government, American and foreign — pour their resources into the American market. They will do this first to escape the volatility that resides elsewhere in the world, and later to ride the U.S. recovery out of the recession.

Posted by Paul Kaye at 5:54 PM
Keywords: The Economy, Tithing, Values
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Friday, January 30, 2009

Read, And Then We'll Talk

The true Joyful Givers can ask God from their heart to send healing to the world. They have the contact with Spirit, for these are the ones who are amassing themselves on God’s side through tithing as a demonstration.

(From God Is Your Partner by John-Roger, DSS)


A must read article from Thomas Sowell of The Washington Times on the stimulus program. Excerpt:

Spending money for infrastructure is another time-consuming way of dealing with what is called an immediate crisis. Infrastructure takes forever to plan, debate and go through all sorts of hearings and adjudications, before getting approval to build from all the regulatory agencies involved.

Out of $355 billion newly appropriated, the Congressional Budget Office estimates only $26 billion will be spent this fiscal year and only $110 billion by the end of 2010.

Using long, drawn-out processes to put money into circulation to meet an emergency is like mailing a letter to the fire department to tell them that your house is on fire.


Here is more sobering reading from top opinion writer at the New York Times, David Brooks.


Throughout 2008, Larry Summers, the Harvard economist, built the case for a big but surgical stimulus package. Summers warned that a “poorly provided fiscal stimulus can have worse side effects than the disease that is to be cured.” So his proposal had three clear guidelines.

First, the stimulus should be timely. The money should go out “almost immediately.” Second, it should be targeted. It should help low- and middle-income people. Third, it should be temporary. Stimulus measures should not raise the deficits “beyond a short horizon of a year or at most two.”

Summers was proposing bold action, but his concept came with safeguards: focus on the task at hand, prevent the usual Washington splurge and limit long-term fiscal damage.

Now Barack Obama is president, and Summers has become a top economic adviser. Yet the stimulus approach that has emerged on Capitol Hill abandoned the Summers parameters.

In a fateful decision, Democratic leaders merged the temporary stimulus measure with their permanent domestic agenda — including big increases for Pell Grants, alternative energy subsidies and health and entitlement spending. The resulting package is part temporary and part permanent, part timely and part untimely, part targeted and part untargeted.

But they’ve created a sprawling, undisciplined smorgasbord, which has spun off a series of unintended consequences. First, by trying to do everything all it once, the bill does nothing well. The money spent on long-term domestic programs means there may not be enough to jolt the economy now (about $290 billion in spending is pushed off into 2011 and later). The money spent on stimulus, meanwhile, means there’s not enough to truly reform domestic programs like health technology, schools and infrastructure. The measure mostly pumps more money into old arrangements.


PK: More on this over the weekend. I think you know where I am going with this.

Posted by Paul Kaye at 9:19 PM
Keywords: Money, The Economy, Tithing
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Sunday, January 25, 2009

Walking Free

To have abundance in Soul does not mean having lots of things; it means having access to, and communion with, the essence of all things.

Once you are in touch with that, you have all things inside you. You don’t feel any lack. You have fullness and gratitude, and you walk free, knowing that whatever you need will come to you.

(From What's It Like Being You by John-Roger, DSS with Paul Kaye)


One thing is clear, and please be clear about it, too, no one really knows what is going to help the economy. We are in unchartered territory. I have heard this from several well respected sources. Here is one of them, Warren Buffett:

The answer is nobody knows. The economists don’t know. All you know is you throw everything at it and whether it’s more effective if you’re fighting a fire to be concentrating the water flow on this part or that part. You’re going to use every weapon you have in fighting it. And people, they do not know exactly what the effects are. Economists like to talk about it, but in the end they’ve been very, very wrong and most of them in recent years on this. We don’t know the perfect answers on it. What we do know is to stand by and do nothing is a terrible mistake or to follow Hoover-like policies would be a mistake. And we don’t know how effective this will be and how quickly things will right themselves. We do know over time the American machine works wonderfully and it will work wonderfully again.

So don't be complacent. Continue to hope for the best and prepare for the worst, and hopefully we'll shoot right down the middle.


You may find these practical tips on the use of coffee filters helpful. Take a look it is very creative.

Posted by Paul Kaye at 6:08 PM
Keywords: Abundance, Frugal Living, The Economy
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Saturday, January 24, 2009

Weekend Reading

I think there is something very profound to the application of "deliberate practice." The Simple Dollar explains it here and Freakonomics explains it here.


"I think the most general claim here," Ericsson says of his work, "is that a lot of people believe there are some inherent limits they were born with. But there is surprisingly little hard evidence that anyone could attain any kind of exceptional performance without spending a lot of time perfecting it." This is not to say that all people have equal potential. Michael Jordan, even if he hadn't spent countless hours in the gym, would still have been a better basketball player than most of us. But without those hours in the gym, he would never have become the player he was.

There is really something to this. It's worth reading. I will be applying it this year to a couple of pursuits in which I would like to eventually acquire mastery.


This quarterly review by esteemed financial advisor Jeremy Grantham is truly excellent. It comes highly recommend by two of my favorite financial blogs. It is accessible and well-written and above all very informative. Having said that it will be too much for most of you. However, I didn't want to hold it back from those of you who will really appreciate it.

Posted by Paul Kaye at 12:54 PM
Keywords: Practice, The Economy
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Thursday, January 22, 2009

Move From Relaxation

“Let go and let God" is not a cliché.
It is a practical direction.
Is there any hurry to go anywhere?
Where are you going that you are not already there?
How can you be impatient
when the important things are always present?

If you want the spiritual flow to work unconditionally,
then you must let it flow unconditionally.
No modifications.
No conditions.
No deals.
Just keep it open.
You receive as openly as you give.
If you start qualifying,
you'll lose.

If you move from a state of tension,
you will be blocked.

If you always move
from your center of relaxation,
you will be free.

(From: The Tao of Spirit by John-Roger, DSS)


Marjorie criticized me for not mentioning the Inauguration. Well to make up for it take a lot at this.


I am not impressed with Treasury Secretary nominee Tim Geithner. It seems like politics as usual, to me.

Jim Fallows' take:

So by the standard of what the country needs right now, I would probably vote for Geithner's confirmation as Treasury Secretary, if I were in a position to do so.

But I do not believe, and will never believe, that his failure to pay his own self-employment tax while at the IMF was an "oversight" or a "mistake." I have many many friends who have worked for this and similar organizations. I have myself over the years juggled the complexities of what is self-employment income and what is W-2 income and how to handle income from non-US sources -- and I have a lot less financial acumen than any Treasury Secretary aspirant should and must have. (Though I also use Turbo Tax!) Not a single person I have known from the IMF or similar bodies, not a one, believes that Geithner could have "overlooked" his need to pay US self-employment tax. When I have received similar income from international sources, the need was obvious even to me -- and I wasn't receiving and signing all the forms to the same effect Geithner would have gotten from the IMF. I could go on with details but I'll just say: if this were a situation more average Americans had experienced personally, he would not dare make his "mistake" excuse because everyone would say, "Are you kidding me???"

And this from The New Yorker's James Surowiecki:

In his written responses to questions from the Senate Finance Committee, the Treasury nominee Tim Geithner explained the decision to let Lehman Brothers fail as the result of … well, actually he didn’t really explain why the government let Lehman Brothers fail. Geithner offered up an explanation for why the Federal Reserve didn’t step in—it didn’t have the legal authority to do so, and didn’t ask for the authority because it was important to maintain “the line between the responsibilities and authorities of the fiscal authority, and those of the monetary authority.” (More important than averting a massive dislocation in the financial markets?) But he doesn’t explain why Treasury didn’t step in, or why it didn’t ask for the authority to do so beforehand, given that Lehman’s demise was not exactly unanticipated. And I don’t understand why, if in fact the Fed and Treasury couldn’t save Lehman because of legal restraints, they were able to step in and save A.I.G., which was also a nonbank, just two days later.

Geithner’s answers on this question were as unsatisfying as just about everything else we’ve heard on it. I suspect the honest answer is the one the Fed chair Ben Bernanke first proffered when he testifed before Congress, on September 24th: “The Federal Reserve and the Treasury declined to commit public funds to support the institution.” That is, they could have committed public funds, but decided not to. The problem is that since it’s clear now that letting Lehman fail was a complete disaster, no one wants to own up to the decision.

To regain confidence and trust we have to do better than this.

Posted by Paul Kaye at 2:40 PM
Keywords: Attitude, Health, The Economy, Unconditional
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Sunday, January 18, 2009

The Grace Track

Because energy follows thought, my advice has always been to hold thoughts that uplift you. Hold images in your mind that you want more of.

Be careful what you ask for because if you get it, you also get what goes with it -- which is fine if, when it does come your way, you are prepared to handle it to completion.

From: The Rest of Your Life by John-Roger, DSS with Paul Kaye

So with the double whammy of the above quote, it is time to place our seed. Remember to see yourself in the picture receiving or being part of what you are seeding for. Make your claim and keep in mind the highest good. And please share with us your success stories.


I was counseling someone the other day and pointed out to them that they were on the "struggle track" and needed to make the switch onto the "Grace track". Not surprisingly they had stopped tithing a while back, ironically when things had been going well. It got me thinking about this quote from a Hopi Elder:

Banish the word 'struggle' from your attitude and your vocabulary. All that we do now must be done in a sacred manner and in celebration. We are the ones we've been waiting for.

Grace is there, waiting. All we need do is turn.


Frugality appears to be the new American way of life as this article, Outsourced Chores Come Home, demonstrates.

There is of course a paradox in this. It’s called the Paradox of Thrift. As Americans save more, less money goes into the economy and, in the short term, things get a lot worse for a lot of people. That is what we are seeing right now in abysmal retail sales, from which other consequences emerge (store space for rent), and so on.


Susan Todoroff, a personal trainer in Ann Arbor, Mich., has begun brewing espressos at home and cutting her hair and cleaning her house herself. And Tamar A. Zaidenweber, a health care market researcher in Astoria, Queens, is spending more time walking her dog instead of taking it to day care each week.

All of these consumers could praise themselves for their newfound frugality in the midst of an economic downturn. But every step they take toward self-reliance — each shrub they prune themselves, each cupcake they bake from scratch — hurts the people and small businesses that have long provided these services professionally.


Thanks to Sumi for these Thomas Jefferson quotes. If only we had listened.

“When we get piled upon one another in large cities, as in Europe, we shall become as corrupt as Europe.”

“The democracy will cease to exist when you take away from those who are willing to work and give to those who would not.”

“It is incumbent on every generation to pay its own debts as it goes, a principle which if acted on would save one-half the wars of the world.”

“I predict future happiness for Americans if they can prevent the government from wasting the labors of the people under the pretense of taking care of them.”

“My reading of history convinces me that most bad government results from too much government.”

“To compel a man to subsidize with his taxes the propagation of ideas which he disbelieves and abhors is sinful and tyrannical.”

“I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.”

Oh, well.

Posted by Paul Kaye at 8:14 PM
Keywords: Frugal Living, Grace, Seeding, The Economy, Values
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Saturday, January 17, 2009

Letting Go, Service, and Integrity

And the reason all this works is that you let go and give to God, joyfully and unconditionally.

From God Is Your Partner (on seeding) by John-Roger, DSS

Well, if that short sentence doesn’t say it all regarding living the spiritual principles of abundance and prosperity I don’t know what does. Please take it in.


If you didn’t see Michelle Obama’s call to service on Martin Luther King Day on Monday here it is. (2 mins)


This is a must see video, named Four Generations, to warm your heart and may redefine abundance for you.


From Wikipedia:

The Achaemenid Persian Empire (550–330 BCE), which at the height of its power had more than 20 nations under its control, was built on the most basic principles - that of truth and justice, which formed the bases of the Achaemenid culture. Based on the Zoroastrian doctrine, it was the strong emphasis on honesty and integrity that gave the ancient Persians credibility to rule the world, even in the eyes of the people belonging to the conquered nations.

This largest Empire of the Ancient World was forged by Cyrus the Great, and spanned three continents, including territories of Afghanistan and Pakistan, parts of Central Asia, Asia Minor, Thrace, much of the Black Sea coastal regions, Iraq, northern Saudi Arabia, Jordan, Israel, Lebanon, Syria, and all significant population centers of ancient Egypt as far west as Libya. It is also noted for freeing the Jews from their Babylonian captivity, and for instituting Aramaic as the empire's official language.

As we have seen, the United States of America has wandered far from its founding fathers who did have the principles of truth and justice in mind. And certainly we have seen any emphasis on honesty and integrity evaporate before our eyes in the last six months. It has taken a generation for things to come off their tracks and in my opinion it will take a generation to get them back on again. Let’s hope that Tuesday will get us off to a good start.

Posted by Paul Kaye at 10:18 PM
Keywords: Joyful giving, Seeding, Service, The Economy, Trust, Unconditional, Values
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Friday, January 16, 2009

Smile, It'll Help You Relax

One of the biggest keys to seeding is making the claim. Get ready we will seed on Sunday.

You state what you want very clearly. Then you claim it as already being here, which is conditioning the consciousness. To receive, you need to act as though you have it; this is the faith statement that it is already present.

(From God Is Your Partner by John-Roger, DSS)


Good article on the consequences of U.S. citizens now turning towards the novel activity of saving. Excerpt:

At a 3-per-cent savings rate, the United States will see $3.8-trillion showing up next year in the banking system just from domestic savers. At 7 per cent, almost $9-trillion will come rushing in as part of the savings tsunami. It is a fire hose of money pointed at the banks, and it's just beginning.

These are ear-popping figures. Three per cent, for example, produces almost five times as much in one-year U.S. capital inflows as the entirety of China's current Treasury holdings. It is four times as much as the proposed Obama stimulus plan. In short, at even relatively small changes, at least in percentage terms, the United States will rapidly transform its banking system and its capital markets.


It's often pointed out to me that I look too serious, some would say troubled. I am basically a happy and contented fellow but the feedback has been consistent I thought that perhaps my facial features should match my inner demeanor. This, I found this recent article in Time Magazine. Excerpt:

My personal trainer sometimes gives me an odd piece of advice during workouts: "Relax your face." For a long time, I found this advice confusing. Isn't physical exertion supposed to be expressed in grimaces? I thought of the face as a pressure-relief valve that helps emit the pain the body is experiencing. But the trainer suggested I think about it the other way around — that controlling the face can help control the mind.


In a follow-on story Time shows Second Place: The Faces of Defeat.

It's always fascinated me how coming second is considered a defeat, no matter how far up the chain you go, for example, Olympic Final.

Posted by Paul Kaye at 9:56 PM
Keywords: Health, Seeding, The Economy
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Thursday, January 15, 2009

You Gotta Have Faith

When you seed, you need to do it with the real faith of the heart. To receive, you need to act as though you have it; this is the statement of faith that it is already present. The faith is claiming that you will receive prior to it coming to you.

Faith is also basking in gratefulness for the grace of Divinity showered on you because you have seeded. And you did it joyfully.

(From God Is Your Partner by John-Roger, DSS)


We are getting ready to place our seed. Hopefully you have been using your imagination to foresee a wonderful thing to manifest, for the highest good. And very importantly you have seen yourself in the picture you are envisioning--perhaps enjoying/receiving/participating in what you have in mind.

The next step is making the claim. And we'll talk about that tomorrow.


Paul Kedrosky's post today about the "Things I Don't Care About or Believe In" really resonated with me. The financial press is full of the same old stuff with no real solution in sight. See if you agree with his list:

Where Bernie Madoff is in NYC on his way to/from hearings. Who cares? Really?

Apple statements on Steve Jobs' current employment status. Apple is marginally less trustworthy than the Kremlin.

Conversation about further capital injections in banks. Nationalize them, let them fail, or shut up.

Decoupled anything. I have been arguing this point for a year, and I still run into idiots who think, say, China is going to bounce right back because it doesn't need trade. It not only won't bounce right back, it will likely go into outright recession.

Depression/recession chatter. We're doing that denial thing about a depression the same way we did about about a recession. A credit collapse, trade spiral, disappeared confidence, failing banks, fast-rising unemployment, and loss of confidence worldwide: We are in a depression of some to-be-determined eventual severity. Stop talking and move on.

I find it helpful to keep track of things I don't care about. That way I can stop paying attention when they come. It's liberating, like emptying out the garage.

Posted by Paul Kaye at 11:35 PM
Keywords: Seeding, The Economy
Comments [1] | Leave Your Comment

Tuesday, January 13, 2009

A Superb Road Map

To receive you must be active. Keep in mind your purpose. You will receive in direct proportion to your clarity of vision, your definiteness of purpose, the steadiness of your faith, and the depth of your gratitude.

--John-Roger, DSS

This excellent quote offers a road map to abundance. I want to particularly bring your attention to “clarity of vision” which we have been talking about, albeit in round about ways, this last week. Please continue to shape your vision for your seed, and then we will take the next step.


The hilarious The Onion came up with an excellent piece on devaluations and the dollar in November 2005, which still holds up today. Excerpts:

Although the value of the U.S. dollar has fallen steadily against the Lithuanian nail and the Estonian crab apple since early this year, many financial experts had predicted that it would hold its own against the acorn.

"The inedible dollar simply does not offer the same long-term security or short-term benefits as the acorn," said James Aucker of the Commodity Futures Trading Commission. "It is even falling against the Costa Rican pocket, the Latvian thimble, and the German Kinder Surprise Egg, which combines delicious chocolate with a fun, easy-to-assemble toy."

Despite the dollar's ongoing depreciation, it has still made significant gains on Congolese human life, which after late trading dropped to U.S. $1.2826.


Financial Quote of the Dayfrom the excellent Tim Price of PFP Wealth Management:

Ronald described government as "like a baby. An alimentary canal with a big appetite at one end and no responsibility at the other."

Where we stand today, a problem caused primarily by the unconstrained greed of the private sector is now being addressed by the dubious intentions of the public sector. History suggests it will not be handled well.

When money is spent, it can only be under one of three conditions. You can spend your money on yourself. You can spend your money on other people. Or you can spend other people's money on other people. This last version is the very definition of government spending.

Tim goes on to offer the following piece of advice:

Indeed the trick in 2009 will be to treat equities like bonds, as primarily income-generating assets (and something has to replace those deposit accounts at dodgy banks, which is to say all of them). So if the stocks in your portfolio are unlikely to maintain their dividend, or worse still don't even pay a dividend, you would be well advised to eject them with extreme prejudice.

Posted by Paul Kaye at 3:43 PM
Keywords: Manifestation, Money, Seeding, The Economy
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Sunday, January 4, 2009

The Key

Societies will fall many, many times in the evolution of the planet, and governments will come and go; that is the nature of this planet. But the Spirit stays forever. The key is this: reach always into the Spirit for the highest good of all and perceive all situations from that point.

(From: Timeless Wisdoms by John-Roger, DSS)

Yes, this was in Loving Each Day today, but it was too good not to be read again as it is germane to this site.


Here are my thoughts for the new year:

1) The spiritual principles of abundance and prosperity will outlive the financial system.

2) Last year proved the fraud was endemic to the system.

3) That will not change this year.

4) Government intervention was necessary to save the world financial system from collapse.

5) This intervention will undoubtedly lead to more fraud and future financial collapse.

6) Printing trillions of dollars out of thin air will have long term negative consequences.

7) Thus prepare yourself inwardly and outwardly.

8) You have time, as it will probably not happen this year.

9) None of this is new. It is just history repeating itself. For us old souls it is just watching the same movie we’ve seen many times before, just with different clothes.

10) The spiritual principles of abundance and prosperity will outlive the financial system.

I will be commenting on each of these points throughout the year.

Posted by Paul Kaye at 7:01 PM
Keywords: God, The Economy
Comments [1] | Leave Your Comment

Friday, January 2, 2009

Illusion Within Illusion

You are worthy of God because you are one with God. You have never been separate; it is only the illusion of this physical level that causes you to think so.

So don’t be ashamed of what or who you are. You are divine. You are perfect. If the human condition doesn’t always reflect the perfection, that’s because there is no way to manifest the perfection here. So don’t worry about it.

Any negativity is just pointing out the next thing for you to work on and to bring across into the Divinity, until one day, and truthfully so, it will all be divine and you will know it as that. There will still be negativity, and there will still be positivity, and you will see it all equally as the Divine. That is your heritage.

(From: Timeless Wisdoms by John-Roger)


Well if you hadn't gotten the idea that this level is an illusion, hopefully the last few months have helped you out. Take money, for example. Dollars are printed out of thin air. I am not making that up. It's no wonder they have "In God We Trust" written on them, because you had better not put your trust in the Federal Reserve which, by the way, to add illusion within an illusion, is not "Federal" at all, but a private banking cartel.

I have been paying an average of $40 for a pair of pants (trousers to our English readership) for about 40 years. (I adjust my standards to my budget--or buy less pants). In that time the Government has gone from talking about millions, to talking about billions, and recently is now talking about trillions!

What is a trillion?

A trillion dollars = $1,000,000,000,000.
That's 12 zeroes to the left of the decimal point. A trillion is a million million dollars.

One trillion dollars would stretch nearly from the earth to the sun. It would take a military jet flying at the speed of sound, reeling out a roll of dollar bills behind it, 14 years before it reeled out one trillion dollar bills.


In short, a lot of money. Here is another way to look at it:

1 million seconds ago was December 22, 2008. (12 days)

1 billion seconds ago was 1976 (32 years)

1 trillion seconds ago was 30,000 B.C. (32,000 years)

But that's ONE trillion. In the last 5 years American debt has grown by SIXTEEN trillion dollars. That's mostly money that has been spent--not invested in business.

Stay tuned.

Posted by Paul Kaye at 10:15 PM
Keywords: Getting Ready, The Economy, Trust
Comments [3] | Leave Your Comment

Saturday, December 27, 2008


I know people who tithe a lot and some who try to get out of it. You don’t have to tithe anything. But if you’re going to tithe, first and foremost you’ve got to be cheerful about it, and then you’ve got to be grateful and thankful about it, and finally, you’ve got to be honest inside of you about it.

There’s a trust that you’re doing what is right and proper for you.

(From God Is Your Partner by John-Roger, DSS)


1) If you have wondered what all the talk about "Treasuries" means and what is meant by the "Yield Curve" this excellent tutorial will set you straight. Highly recommended.

2) Does it seem that life has speeded up since last year, and the year before that? You are not imagining it, as you will see from this presentation.

Posted by Paul Kaye at 4:42 PM
Keywords: Basics, The Economy
Comments [0] | Leave Your Comment

Friday, December 26, 2008

Some Good Reading

Peace is not like a leaf floating on still water. Peace is alive and vital. It includes children who are making noise, laughing, crying and doing life their way.

~ John Roger, DSS


About Nancy Rivard (see yesterday’s post):

After searching for life's deeper meanings in all corners of the world, after meeting numerous sages and saints, after experiencing inexplicable phenomena, after all the mundane trials and tribulations, Nancy came to an understanding: she saw that the extra-ordinary lies in the ordinary, that joy comes in service, and that the potential of love resides in each action, every moment.

So when she says "love in action", it's no longer a cliche. It's an experience.


From blogger Corey Amaro:

Somewhere while praying I heard the Priest's words clearly speak to me...."Participate in your divine Presence."

From that moment on I have thought of nothing else. To be our divine self is the greatest gift we can be and give to one another. To be present to our divine being, that which is holy, which uniquely connects us to one another. To put our divine presence in front of us, to let it guide us.


Financial quote of the day #1

Madoff's scheme played into the belief that wealth was not something to work for, but something to scheme for. It could be generated by playing your cards right, hooking into the right networks, and finding the right "investments." The people with whom he dealt had, it turns out, some internal sense that there was something a little bit shady about the whole operation. But they dispensed with this sense when the fat checks arrived, and concluded that whatever was making this perpetual motion machine operate, it did work.

--Art Carden of the Ludwig Von Mises Institute.


Financial quote of the day #2: (Long but a must read).

It is a sorry place at which we Americans find ourselves this none-too-festive holiday season. The biggest names on Wall Street have gone to their rewards or into partnership with the U.S. Treasury. Foreigners stare wide-eyed from across the waters. A $50 billion Ponzi scheme (baited with, of all things in this age of excess, the promise of low, spuriously predictable returns)? Interest rates over which tiny Japanese rates fairly tower? Regulatory policy seemingly set by a weather vane? A Federal Reserve that can't make up its mind: Is it in the business of central banking or of central planning? And to think -- our disappointed foreign friends mutter -- all of these enormities taking place under a Republican administration.

Barely nudging Mr. Madoff out of the top of the news was the Federal Reserve's announcement last Tuesday that it intends to debase its own paper money. The year just ending has been a time of confusion as much as it has been of loss. But here, at least, was the bright beam of clarity. Specifically, the Fed pledged to print dollars in unlimited volume and to trim its funds rate, if necessary, all the way to zero. Nor would it rest on its laurels even at an interest rate low enough to drive the creditor class back to work. It would, on the contrary, "continue to consider ways of using its balance sheet to further support credit markets and economic activity."

One market, only, registered a protest. The Fed's declaration of inflationary intent knocked the dollar for a loop against gold and foreign currencies. In many different languages and from many time zones came the question, "Tell me, again, now that the dollar yields so little, why do we own it?"

It was on Oct. 6, 1979, that then-Fed Chairman Paul A. Volcker vowed to print less money to bring down inflation. So doing, he closed one monetary era and opened another. With Tuesday's promise to print much more money, the Federal Reserve of Ben S. Bernanke has opened its own new era. Whether Mr. Bernanke's policy of debasement will lead to as happy an outcome as that which crowned the Volcker anti-inflation initiative is, however, doubtful. Whatever the road to riches might be paved with, it isn't little green pieces of paper stamped "legal tender."

Our troubles, over which we will certainly prevail, stem from a basic contradiction. The dollar is the world's currency, yet the Fed is America's central bank. Mr. Bernanke's remit is to promote low inflation, high employment and solvent finance -- in the 50 states. He wishes the Chinese well, of course, and the French and the Singaporeans and all the rest besides, but they don't pay his salary.

They do, however, buy the U.S. Treasury's bonds, which frames the emerging American dilemma. If the Fed is going to create boatloads of depreciating, non-yielding dollar bills, who will absorb them? Who will finance the Obama administration's looming titanic fiscal deficits? Who will finance America's annual surplus of consumption over production (after 25 more or less continuous years, almost a national trait)? Inflation is a kind of governmentally sanctioned white-collar crime.

Every crime needs a dupe. Now that the Fed has announced its plan to deceive, where will it find its victims?

--Jim Grant (Highly respected financial commentator who called our present troubles a couple of years ago)


It’s enough to make you reach for the Prozac!

From veryshortlist.com:

Diagnoses of ADHD and depression have skyrocketed over the past decade. Pediatric bipolar disorder is up a whopping 4,000 percent. And prescription rates have jumped accordingly: 5 million American children (6.6 percent of them) now take psychotropic drugs. But according to Harvard psychologist Jerome Kagan, many of them needed neither diagnosis nor drugs.

Kagan argues that the rise in diagnoses reflects an ugly collision among increasingly squishy parenting (which creates disruptive or depressed children), immense social and economic pressures to have kids perform well, and increasingly sloppy diagnostic practices that “medicalize” every behavioral problem. Too often, he says, we ignore problems in a child’s environment and substitute medications for the structure, discipline, and nurturing he or she needs. Change the environment, he says, and you will usually change the child. Sadly, in the age of Prozac, Ritalin, and Risperdal, such change is rarely attempted.

Well said, and proof that the world is getting increasingly meshugganah!!!

Posted by Paul Kaye at 6:10 PM
Keywords: Service, The Economy
Comments [1] | Leave Your Comment

Wednesday, December 24, 2008

Bringing Out the Best in Us

Just back from the webcast in Santa Monica. Lots of hugs and beautiful people.


We're actually celebrating our own birth. We're celebrating our own resurrection. We're celebrating triumphantly our own movement back into our true self or Christ Consciousness.

In fact, many of us are just rushing into it, arms and hearts wide open, full of love, and knowing that not one thing is coming our way that we can't handle.

The Christ Within & The Disciples of Christ by John-Roger, DSS

A nod to Lisa. Love that last line.


I liked this quote from a reader of Fuller Money Daily Comment.

As the boomers begin to sell off assets to use for retirement this will put most assets on offer...while, the next generation (that's me) is ill prepared to purchase them. We have been thru stock market bubbles, housing bubbles, and now a credit bubble. There is clearly no pent up demand for speculation in this generation. They have played and lost. Repeatedly. I envision some downsizing and saving which should put a lid on most longer term rallies.


No More Lies?

Had enough of lying and deceit by those in positions of power? Read this. New Year’s resolution anyone? Who among us is going to throw the first stone?


I wish Tom Friedman was right but I really think the system has to fall before it can be rebuilt on a new solid foundation. Excerpts:

For all these reasons, our present crisis is not just a financial meltdown crying out for a cash injection. We are in much deeper trouble. In fact, we as a country have become General Motors — as a result of our national drift. Look in the mirror: G.M. is us.

PK: Agreed

That’s why we don’t just need a bailout. We need a reboot. We need a build out. We need a buildup. We need a national makeover. That is why the next few months are among the most important in U.S. history. Because of the financial crisis, Barack Obama has the bipartisan support to spend $1 trillion in stimulus. But we must make certain that every bailout dollar, which we’re borrowing from our kids’ future, is spent wisely.

It has to go into training teachers, educating scientists and engineers, paying for research and building the most productivity-enhancing infrastructure — without building white elephants.

Generally, I’d like to see fewer government dollars shoveled out and more creative tax incentives to stimulate the private sector to catalyze new industries and new markets. If we allow this money to be spent on pork, it will be the end of us.

PK: The money will mostly go to the people who got us into this mess in the first place. Fraud is endemic in the system. I was going to begin the sentence with “sadly.” But why should I say sadly when from a spiritual perspective it is all perfect. Last night driving home, I recalled what J-R had said at the booksigning in San Francisco when asked about these times. As I remember it he said that sometimes things have to be at heir worst for us to be at our best. Maybe that is this blog’s new mantra.


An Amazon reader's review on Michael Pollan’s book In Defense of Food.

In all this, Pollan insists that you have to save yourself. And he makes a good case why. Our government, he says, is so overwhelmed by the lobbying and marketing power of our processed food industry that the American diet is now 50% sugar in one form or another --- calories that provide "virtually nothing but energy." Our representatives are almost uniformly terrified to take on the food industry. And as for the medical profession, the key moment, Pollan writes, is when "doctors kick the fast-food franchises out of the hospital" --- don't hold your breath.

Seems like saving ourselves is going to be a theme for the next few years.

Posted by Paul Kaye at 10:48 PM
Keywords: Getting Ready, Health, Money, The Economy
Comments [1] | Leave Your Comment

Tuesday, December 23, 2008

"Us Band of Brothers" (and Sisters)

My blog readers are a small bunch. There have been times where I have thought of giving this up only to be told by someone that they are an avid reader and they have gained great value from it. So I am going to continue with my daily posts for another six months to complete a year of doing this. After all, this is the craziest time of our lives.

As I have said before, you certainly don’t need this blog to get a take on the teachings—there are plenty of J-R books and cd’s where you can get that straight from the source. This blog is a reflection on the spiritual principles of abundance and prosperity plus my personal opinion on the world financial backdrop. It is not the opinion of J-R or John Morton. I don’t know if they agree or disagree. I say this because I am going to be getting increasingly direct, starting with this post. It is my opinion. Please feel free to share yours in the comments.


I love this quote from J-R that I posted recently:

“What is the work that you’re here to do? The most immediate thing in front of you, and there are two choices: either live under the law of karma or live under God’s grace of loving. You can have your choice. And the grace of God did not say for one minute that you won’t have any pain. It just said you can live in the Spirit while you walk through this world.”

I love it because it says clearly that we can have our choice. And we will have the opportunity to choose. The system is collapsing. We need to be strong to keep choosing and being open to the grace. Who the President or Prime Minister is really doesn’t matter at this point in the big picture. We all need to do our best to prepare. And nothing is better than what we already know--s.e.’s, service, tithing and seeding. The things that direct us to God—where there is endless love, endless supply.


I do strongly believe that what will emerge out of this will be a better, more enlightened world—a Golden Age if you will. But to get there we need to do things differently—very differently. Since, as human beings, we tend to be reluctant to change when we are comfortable, change is being thrust upon us. But don’t feel like a victim as what stood as a system was a fraud and a grand illusion. A mockery of what was put in place by the enlightened Founding Fathers of this great country. Principles were thrown out the window. Now we face the music. Our Light, our neutral loving, and our empathy will be the most wonderful assets to assist ourselves and others.

Blogger and innovator Robert Paterson went to the John Boyd Conference and came back with a summary that is both disturbing and fascinating. I have excerpted his post below because I agree with, not all, but most of what he is saying:

Boyd 2008 - My Overall Conclusions

So what in summary did I take away from this amazing weekend?

That there is no soft landing. We are not in a recession. We are not even in a depression. We are at the end of an era. The Tipping Point is of course the financial collapse. The Vast Ponzi Scheme of our financial world - with the vast sums in the Derivative Market and the Credit Bubble are all in effect lost – they cannot be saved. There is not enough money in the national accounts to pull this back.

The search for efficiency and the urge to consume has set us all up like a row of dominoes - there is no buffer, no resiliency. As one problem rises it causes another. As one solution is tried it drives another problem. We all pull back and the consumer economy stalls. The auto industry and credit firms feed the media (40% of conventional advertising). Papers and TV and Radio networks, many subject to LBO's (Levereged Buyouts) will have to fail as per the Tribune. Every sector will be laying people off. Sales of all things fall off a cliff - driving more business failures and layoffs. Cities and states that depend on sales tax and property tax and the credit markets can rely on none of these. So they too will have to lay off millions - thus making all the problems worse. National governments will be asked to save us all and of course cannot. As States and Cities get squeezed and cannot borrow, they will too lay off millions - teachers, firemen, police.

The world food system is exceptionally connected and tightly coupled. High fertilizer prices in 2008 will drive a food shortage in 2009. Inventories of grain are already low. The collapse of commerce and credit may risk food supplies in 2009. The 2008 rice problem was a harbinger for what is to come.

The problem is our mindset - the Newtonian Machine view of reality. It has outlived its value and become its dark side. We have given up all our power to it and those who control it could not help themselves from looting it.

The solution is a new Mindset that of an interconnected world with organizations and a leadership model that fits this new reality.

The goal for us all to work to is clear - that we have to build back into the system Resiliency. This means that each region has to work to become largely energy, food and financially self-sustaining and that each region needs to network into the others. In effect we shift from an efficient machine to a resilient network.

That the leadership model is no longer the dominant hero but the egoless servant.

That we cannot wait to be saved. We have to all do our part to make our place "Home."

Many are desperate that somehow President Obama save us and importantly turn the clock back. Take us back to consumer heaven of 2006. Even if he could, would this be the right thing to do? To take us back to a world that is a fantasy?

What got us to this place?

The Dark Side of a Mindset. The Machine/Institutional/Newtonian/Engineering Mindset that created most of the wealth of the 19th and 20th century tipped over into the dark side. Where not only did we give up all our power to institutions but gave the few that ran them the license to use these institutions for their own benefit.

So we spend nearly a trillion on defense but not on what the troops really need. We spend billions of health and America is on a par with Cuba. We spend billions on education and more than 50% of Americans are functionally illiterate. We spend billions on food and we eat crap. We make no progress toward energy independence.

The problem is how we all "saw" the world/reality. We gave up all that was important to us to faceless bureaucrats. Our energy, our food, our health, our education, our security and our wealth. We ended up like peasants in the middle ages who gave up their soul and their chance of salvation to the Bureaucrats who ran the church - who made a business - indulgences - out of our naive faith in their ability to act on our behalf.

So what can we do? This was a huge focus of the conference.

We have to shift the Mindset and hence the design of our world from Efficient Machine to Resilient Organism. We have to shift the mindset of the leader from the hero/Savior to the servant leader.
Above all, each place has to be largely self-sufficient in:

Money/Stored wealth/Credit/Savings

So the Boyd Conference was both depressing and exhilarating. It seemed clear that there was no way back but that the way forward could be wonderful - if we chose it!

(Full post here.)

Posted by Paul Kaye at 7:27 PM
Keywords: Getting Ready, Grace, The Economy, Values
Comments [4] | Leave Your Comment

Thursday, December 4, 2008

How to Receive

Q: It's very easy for me to give and give, but much more difficult for me to receive. How can I learn to receive?

A: You must be open to receive. If I have something to give you but your hands are tightly closed behind your back, I have no vessel in which to place my gift. But if your hands are open and you reach out to receive, I can place the gift in them.

The same is true for those things that are of Spirit. If you are uptight and closed down inside of yourself, how can you be open to receive the bounty that is available to you?

If it's truly difficult to receive, you might begin by receiving in small ways. Let someone buy you lunch, open the door or run an errand for you. Most people will be very willing to give to you. It's you who decides how much you want to receive on all levels.

(From: Q&A from the Heart with John-Roger Journal)


Some nice thoughts from you all on the meaning of frugality. Thanks for weighing in.

Bruce commented: “I seem to remember that the phrase voluntary simplicity can equate to frugality and also to greater choice, creativity and even elegance.”

However, I think this article from the “Cheapskate” column in the Wall St Journal says it all, and we’ll leave it as the last word on frugality:

According to the experts being a tightwad isn’t the happiest state of being. Many cheapskates experience something akin to physical pain when they spend, and are constantly anxious about money.

Spendthrifts aren’t necessarily any happier. Their free-spending often causes stress in their lives and marriages. Indeed, the experts say the happiest people are frugal, which they define as people who are able to spend without suffering but take pleasure in saving.


Maybe it’s because I’m a Londonder that I love these gorgeous overhead shots of London at night.


What a soap opera! I like Elizabeth Kolbert’s take on the bailout of the big three carmakers in this New Yorker editorial. Excerpt:

What would it mean if the domestic industry were allowed to fail?” G.M.’s Wagoner asked last month. “The cost would be catastrophic. . . . That’s why this is all about a lot more than just Detroit.” Together, the Big Three employ some two hundred and fifty thousand people, and, as the automakers correctly point out, millions of other Americans—from the machinist at the tire factory to the waitress at the corner bar—indirectly depend on them for jobs. Were these jobs to be lost, the effect would ripple out through the economy, producing what Paul Krugman, on MSNBC, recently called “a huge anti-stimulus program at exactly the wrong moment.”

It would, of course, be foolish to allow the American economy to collapse in order to make a point. And it’s possible to conclude that the Big Three deserve on every front to fail and still decide to rescue them. But such a decision will itself be a form of temporizing, and will only pass the problems on to the next Administration. Real change—as opposed to the kind in slogans—is hard and, by definition, disruptive. If Obama has any intention of fulfilling his campaign promises, sooner or later he’s going to have to face up to that.

And related to the subject with an extra twist is this, my Financial Quote of the Day:

The Big 3 may get a bailout. Financially the US taxpayer will get a stake - in what will surely be radically reshaped companies. Citibank just got a large infusion from Saudi Arabia's Prince al-Waleed bin Talal al-Saud - just days before a US government orchestrated rescue helped rocket the share price. Maybe these are just coincidental moves. Maybe not.

What we're witnessing isn't finance or investment as usual. We're watching a shift to a managed economic structure, where government officials determine who will live and who will die. It's a shift from investments to agreements, where having access to large pools of ready cash is the ultimately persuasive argument. And lacking access means doing whatever you're told.

-- From: John Maudlin’s Outside the Box

Posted by Paul Kaye at 10:33 PM
Keywords: Frugal Living, Receiving, The Economy
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Wednesday, December 3, 2008

Sheer Madness

There’s abundance from God, but not necessarily in this world. You can’t have it all in this world, but in the inner worlds you are it all. And that’s what you can trust.

--John-Roger, DSS

Broadly speaking, in this blog we are attempting to bridge two worlds, the world of the miraculous and the world of the mundane. Although entirely different, the worlds are not incompatible and we take from both what works for us and use it. When we emphasize or focus our attention on one world we make sure we are not in denial of the other.

As long time readers know I have been as direct as I can about what is going on from my pint of view. Sometimes a little too direct, perhaps. Someone implied that a client of theirs was freaked out at my presentation at a ministers meeting a month or two ago and had to go to Michael Hayes to clear themselves. While I await a thank you card from Michael, I would like to say that I have no intention of being a bearer of bad news. However, I do think that we need to look directly at what is going on, taking the necessary practical steps, while always knowing that the miraculous carries the day—God being our Partner.

In the same conversation the person had an objection to the word frugality. He thought it reflected a poverty consciousness. When I asked my wife, Shelley, what she thought of that she said, “How would I know? I am in poverty consciousness most of the time.” (It’s a laugh a minute at our place).

A search of the MSIA database showed that J-R had barely ever used the word frugal, so admittedly it is not part of the MSIA lexicon. However, it is one of my values and I think it is particularly appropriate to embrace it in the times we are living in. In fact, we got in the global financial mess we are in because it was not embraced.

The Financial Times had an article by Bertrand Benoit on the different mentality of the Germans. Excerpt:

US, French, and British officials puzzle over Germany’s refusal to tackle the recession head-on. German leaders, meanwhile, cannot see why their taxpayers’ money should go into encouraging precisely the kind of behavior—reckless lending, careless borrowing and overconsumption—that precipitated the financial crisis.

With morals, values, moderation and solid common sense looming so large in Ms Merkel’s (Germany’s Political Leader) economic thinking, it is no surprise she would see overindulgence and irresponsibility in the way the UK and, above all, the US are treating their own recessions.

The notion that one should tackle a slowing economy by encouraging over-indebted people who stand a good chance of losing their jobs to draw new credits and splash out comes across as sheer madness.

Meanwhile Jason Zweig in his Wall St Journal blog today, The Wallet, talked about his very modest and simple childhood, after someone suggested that he “was a coddled member of the silver-spoon generation.” His post went on to say (my bold):

So I know what it means to scrimp and save, to do more with less, even to do without. The most important lesson that I learned, I believe, is that money is not wealth. Benjamin Graham once wrote that the secret to happiness is learning to live well within your means. Did he mean to “live well” within your means, or to live “well within” your means? I think he intentionally left the sentence ambiguous.

Money should never be taken for granted. Its uses are limited, but it is not a renewable resource; it is finite. And finite resources — love, water, the Earth and, yes, money — are meant to be stewarded and treated with care.

We did not feel poor, we certainly did not feel deprived and, in fact, we would have been furious if anyone had suggested that we were anything other than thrifty. Life may not always have been easy, but it certainly was good.

To this day, I recycle used paper back into the printer, reuse paper clips, put food scraps in the compost, turn the thermostat down and the lights off not because I once was “poor” but rather because I hate waste. Not being wasteful makes me feel good.

Close your eyes and think of the quintessential American. Who comes to mind first? In my mind’s eye, I see two: Benjamin Franklin and Abraham Lincoln. Each of them had many virtues, but one of the most obvious was a sense of thrift. In fact, thriftiness used to be one of the central defining characteristics of what it meant to be an American.

After a long and lazy boom, America has become a society that squanders just about everything, including money. If this crisis ends up changing that, we will be a better nation for it.

(Full post here. A recommended read.)

So if you don’t like frugality, too bad. Read another blog. We can’t change the world, and who would want to—it’s perfect as it is, but we can be responsible to our ten percent level while calling upon the miraculous nature of Spirit to sustain us. That way we get to live in abundance, prosperity, and riches regardless of our circumstances.

And as to the world, I like what Anne had to say in her comment yesterday:

I love this whole thing about trust and developing more deeply my inner connection with Spirit. Such a powerful thing to be doing.

More blessings of the meltdown. I love the thing about the caterpillar that goes into meltdown, literally a messy fluid as I understand it, in the cocoon before it emerges as a butterfly.

I think there are a lot of butterflies now in the making...

Indeed. Just let's not get them in our stomachs as All is well and God is our Partner.

Posted by Paul Kaye at 6:11 PM
Keywords: Frugal Living, The Economy, Trust
Comments [3] | Leave Your Comment

Thursday, November 20, 2008

Manifesting God's Abundance

A longer J-R quote today from Manifesting God’s Abundance, one of my all-time favorite seminars.

When we look at our business in terms of, "I wonder if I'll make money next year." Or, "Will I have a job next year? I wonder if they'll rehire me." Lord, what are you doing to yourself? The answer is probably not because you're manifesting lack. You're manifesting it. You're creating it with your breath instead of saying, "Hey, next year I'll have a job. I don't care if it's this job. But the job is going to be more abundantly alive, awakening me, than ever before and God help me be strong enough to fulfill it the greatest way possible. And let me learn and get strong so that when it comes I can't say 'Oh no' because I can't handle it because I was not prepared." You see, the big difference we're dealing with?

The abundance doesn't come in on your timing. It comes in on its timing. So part of your manifestation is not to manifest impatience. That's a lack of patience. Yours is lack. Yours is not the fulfillment. You see, if we ask for anything in terms of this world, in terms of spirit, in terms of another individual, we must be willing to give to receive. We must be willing to make that first overture, that first presentation. If we're going to manifest the fullness, then we must represent fullness. If we represent fullness all the time, what do we have? Full-ness. It's not positive thinking because you can positively think it full or not be full. You manifest fullness. You become that all the time.

No matter what happens, you pull from inside of you and give of the fullness. And people will ask. “Where did you get it?" And you say, "I don't have the foggiest, it was just there--the Father is delivering to me all the time. All I had to do is do." And the manifestation of the abundance is the doing. When we do, it starts coming through. Now, here's the big key: We always look out there for people to manifest to us our abundance through God. What we're doing is we're restricting what can come to us.


I received a question that if the dollar will be declining what do I do with my money magnet?

Gold. There is a reason that it’s hard to find gold coins. People have caught on. Still, there is no need for panic, cash is going to be useful for a while. But for the long term, gold has the history of longevity. And of course real estate is wonderful to own. The basic self loves land.


I loved this concluding paragraph from Jeremy Grantham’s GMO quarterly newsletter.

Finally, a Single Piece of Advice for the Government

I have never been a fan of the hysteria that has surfaced on all sides in recent years at a hint of recession, and the panic to throw public money at the economy. Mild recessions have several long-term advantages discussed in earlier Letters, but in recent years we seem to have lost interest in the long term.

However, this time it's different. This is the Real McCoy crisis, and we must welcome all the stimulus we can get. It is easy, though, to end up employing people to build mildly useful parks or, in the Japanese style, nearly useless bridges to nowhere. Government stimulus can have a decent (even high) return in the long run. It absolutely doesn't have to be a series of boondoggles. Let me suggest that the magic word this time is not "plastics" but "alternatives." Massive spending on energy and, better yet, energy savings will create jobs, stimulate the economy, produce a good long-term economic return, reduce dependence on depleting Middle Eastern oil, curtail carbon dioxide emissions, and set, for once, a real example for other countries. From the simplest - better insulation and more efficient machines - through the new alternatives - solar, wind power, and second generation biomass - to the potentially massive investments in new nuclear plants and efficient energy transmission, this could be in total a long range bonanza for the U.S. in economic and broader respects. Such a program could offset the risks of a Japanese-style drawn-out recession. It would be potentially an epoch-defining change, and one of which, like the Marshall Plan, future generations might be proud.

Posted by Paul Kaye at 3:22 PM
Keywords: Fullness, Manifestation, The Economy
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Wednesday, November 19, 2008

Interesting Stuff

When you know of the law of karma (the law of cause and effect), you know that if someone does something to you that you think is unfair, you can just let it go. You know that if it is unfair, the other person will be held accountable for that, through Spirit. You do not have to do anything. You do not have to seek revenge or try to get even. You do not even have to think about it or hang on to the experience at all. You can just learn whatever you can from it, let it go, and go on to your next experience.

(From: Fulfilling Your Spiritual Promise by John-Roger, DSS)


I love the above quote. It also doubles as a Zen Moment of the Day.

Lots of interesting stuff, below. We’ll get back to “manifestation” tomorrow.


Why if are gold coins are hard to find, the price of gold is not going up? Richard Russell gives this answer:

The quest for physical gold continues. I was told this morning that some dealers are now adding an 80 dollar premium over the gold price for gold coins (if you can find any coins). Yet the hedge funds, who are receiving redemptions, continue to be sellers of "paper gold" (GLD) in order to raise cash, thus holding the price of gold down.


And the discussion about having a gold standard is gathering momentum. Please educate yourself and read this excellent and clear article from the Christian Science Monitor.

Excerpt: “America faces a stark choice. The path back to a gold standard is rocky and uphill. The current inflationary path is slippery and downhill. One leads to integrity and stability. The other could lead to financial ruin. Which will we choose?”


Ever wonder why you get those cheezy emails offering you millions from Nigeria if you just deposit a few thousand in their bank account? Well apparently it's because they work. Even though it seems a little far-fetched, I have heard many stories of the same.

Shelley got an email the other day from the “IRS” offering a refund. Everything looked very official, they even piggy-backed on the official IRS site. They signed off on the email, “Regards.” Since when has an official communication, from the IRS of all people, said regards? It was obviously a scam. Still, they were offering Shelley a refund and she went for it, opening the email. Fortunately, her computer, a Mac, had a fraud detector and up it popped, saving the day, and possibly the hard drive. These things can be enticing. Be careful out there, in Internet Land.


The quote below from Jame Surowiecki’s New Yorker blog let’s you know why I am fascinated by the General Motors situation. It goes to the very heart of the American psyche and also to the essence of what has driven the economy these years. As we have mentioned we have just come out of the “Unravelling.” Now we are into the falling apart stage.

Tyler Cowen, I assume, opposes any bailout. But he articulated perhaps the best argument for it a couple weeks ago in The New York Times, when he wrote:

“Rebuilding confidence might seem a small matter, but it is not. The truth is this: America is a wonderful and magnanimous nation when it is a winner, but Americans are not used to losing and Americans are not used to panic.

Often we respond to negative events badly, so we need to be especially careful when we are in a losing or risky position.

Very bad events can cause a panic among the citizenry or its leaders, which translates into subsequent bad decisions.”

It’s important that policymakers and pundits not fool themselves. Americans are not prepared for G.M. and Ford to go bankrupt. At this point, their failures would be “very bad events,” and they would cause people to panic. If you’re ideologically opposed to the very idea of bailing out private corporations, then opposing this bailout makes sense. But if you’re making a risk-reward calculation, then it doesn’t.

Posted by Paul Kaye at 2:16 PM
Keywords: The Economy
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