A few (admittedly) simple thoughts.

A few (admittedly) simple thoughts on the economic consequences of a Trump Presidency.

Mathematics is and never has been a simple concept. As the millennia have passed it has only become more complex and difficult to understand without years of dedication to its structure, syntax and nomenclature. In short, mathematics has become the single most complex of all human languages. Yes, mathematics is a language, though it is not a spoken language it is never the less a language. It is a language that describes the universe in all its glorious mysterious complexities.

From ancient times humans have been engaging in various forms of commerce. Commerce being the exchange of goods, labor and idea’s. In its earliest form it exchanged goods in a form of transaction known as barter. At some point in time, simple barter became to cumbersome for growing civic society. Or, to be more precise, it became to cumbersome for the process of taxation. Thus was born the first of the symbolic abstract representations for tangible goods and labor. From the very beginning currency is and always has been a medium that’s value is predicated on representing something other than itself.

At its inception it represented certain specific quantities of tangible goods. A single copper or silver coin equaled a fixed number of bushels of grain, chickens, cows or other manufactured goods. It evolved into a symbolic representation of labor and then inevitably into a symbolic representation of time itself. As in that long time prior, gold, silver, copper and all other forms of currency hold little actual value in and of themselves. They are symbolic representations of tangible goods, idea’s and physical labor, specifically quantities far to great to be transported by a single individual with great ease.

For millennia simple addition and subtraction were sufficient to deal with basic currency transactions. With the invention of accrued interest more complex mathematics become necessary. The more complex society became, the more complex mathematics became and the more complex financial transactions became. The more complex the mathematics involved in financial transactions became, the better those governing any society were able to stabilize the societies that they governed became.

The mathematics that govern said transactions, including taxation, evolved into the science of Economics. Half jokingly referred to by many of its practitioners as a “Voodoo Science” it is an extremely complex branch of mathematics. Its complexity draws not from the mathematics itself, but from the unpredictable nature of the physical conditions that it describes. The inability to predict when it will rain or how much it will rain, thus crop failures or livestock mortality, add a degree of uncertainty to the calculation that make it almost seem as if economist are guessing which way the economy will go.

Crop failures and livestock mortality are but two of literally dozens of variables trapped inside the equations which economist rely on. Two of the most difficult variables to accurately model are greed and fear. Traveling down this path far enough, and we reach perhaps the single greatest obstruction to accurate economic modeling. A failure to grasp the implications of mathematics and human greed and fear. Here, that ancient invention of accrued interest rears is ugly head. It does so in that brutal manner genuinely only mathematics can do.

When accrued interest was invented, so was a rule that would not be discovered for millennia, a rule blessed and cherished by investors, banker’s stockbrokers and basically everyone involved in the financial industry. Enter the Rule of 72. The Rule of 72 defines the amount of time any investment at any given interest rate requires to double in value. Hidden deep inside the Rule of 72 is a vicious and hideous monster waiting for the unsuspecting.

You can only keep doubling the grains of rice on a chess board for so long before the number of grains of rice weigh more than the entire earth does. Greed and a failure to grasp the mathematical implications of the Rule of 72 blind most people to what must eventually come to pass. Transpose the grains of rice on the chess board with currency, and the doubling of grains of rice with interest accrued under the Rule of 72 and the inescapable consequence is that eventually the weight of currency becomes so great that the entire planet earth’s financial system is crushed under the burden of its weight.

A friend of mine, who as it just happens, holds a post graduated degree in economics is quite fond of pointing me to articles written by Dr Roubini. Doctor Doom as many in the media have christened him has a damned good track record of predicting failures within the financial industry. In 2015 Dr Doom predicted that the worlds financial industries were in extreme danger of being “Reset” by a “liquidity time bomb”.

Dr. Doom: This ‘time bomb’ will trigger next financial collapse.

While Dr Doom does not spell it out as I do here, and perhaps would even disagree with my analysis, I would argue that Dr Doom’s “liquidity time bomb” is essentially my “Rule of 72 Monster”. There is no simple path out of the quagmire the worlds financial system is in. A “Reset” is coming regardless of what any of the worlds leaders do. The question here being, will it be a hard reset or a gradual (soft) reset. The variables in the equations, greed and fear, will make the path forward fraught with danger for not just President Trump, but for all of the worlds leaders.

Nobel Prize winning mathematician John Forbes Nash employing game theory, both identified the problem, and its solution in his Nobel Prize winning equation that bears his name, “The Nash Equation”. The problem of course is that Nash’s solution only works if everyone agrees to abide by it. Remember the variables greed and fear? In other words, while Nash provided the solution, its highly unlikely that it will ever be enacted. Given this as a painfully obvious reality, Dr Roubini has weighed in on the implications and probable realities of a Trump Presidency and its world wide economic consequences.

Trump’s Monetary Conundrum

For a guy nicknamed Dr Doom, this article seems rather optimistic. Yes, it contains plenty of warnings of how things could go very wrong. That said, it is not a gloom and doom article, but a cautionary one of potential pitfalls to be avoided and possible paths towards economic recovery.

Vacationing in Pittsburgh.

In this world in which we find ourselves sojourning, if we are so fortunate to find a genuine friend, then we may count ourselves truly blessed. My dearest and closest friend, who just happened to be my mother, passed on September 15th of 2016. Though it may not seem so since I am so free with my opinions and willing to post them here for all the world to see, I am in fact a man of significant solitude. The number of people I take into my deepest confidence is a pretty small number.

I am also a man of divergent public conflicts. Having spent most of my life as a performing musician, one side of me is a very gregarious and outgoing individual. I am, as anyone who has ever met me in person can easily attest, the absolute life of any party I attend. I am gentle, kind, humorous, funny, friendly and an absolute riot to be around. I also, in diametrical opposition to my gregarious public nature, have a profound need for periods of solicitude. I simply need quiet time to think and reflect on what I see and perceive around me.

Among the handful of individuals on this earth who have my confidence is a Renascence man who makes his residence in a small hamlet in Pennsylvania on the outskirts of Pittsburgh overlooking the Ohio river. In the wake of a number of personal tragedies that have befallen me and my family over the course of the last 2 years, this true gentleman and scholar and his beautiful wife absolutely insisted that I come and spend a week with them. My soul was being crushed, and he saw this where I could not. He and his beautiful wife saw that I needed help, and they were not about to take no for an answer. That my friends, is the definition of friendship.

So, at their insistence, I allowed myself to be packed like a sardine into a hollow aluminum tube and hurled through the stratosphere at 500 mile per hour from sunny San Diego, California to Pittsburgh, Pennsylvania. The seven day weather forecast for where I was going promised to be cold, cloudy and rainy. In what my gracious hosts described as a rather shocking turn of events, it was none of the above. In fact, is seemed rather as though the glorious weather of Southern California had decided to travel with me.

img_20161104_113947 (Arriving in Saint Louis)

Beaver County, Pennsylvania was utterly beautiful, 72 degree’s and sunny for 5 out of the six days I was there.

img_20161104_164231 (Either Beaver county or Allegheny county seen from the air, not sure which one)

img_20161104_164827 (Arriving in Pittsburgh)

While we only spent one day in Pittsburgh itself, I can honestly say that I was surprised. I was expecting it to be a cold and impersonal major industrial complex. While it is indisputably true that this is one aspect of Pittsburgh, it is equally true that to exclusively categorize Pittsburgh as such would be totally incorrect and grossly unfair. Surprise, surprise Pittsburgh has a heart, and that heart beats with culture, joy and friendship. In Pittsburgh there is a shopping district known as “The Strip”. If you are a foodie, love exceptionally well crafted beer’s or are into arts and crafts, “The Strip” will blow your mind.

img_20161107_130435 (A store in “The Strip”, absolute foodie heaven)

As an individual who has for the most part grown up in Southern California (which contrary to what you might have been led to believe by Television, Movies or Media propaganda is actually a desert) I found rural Pennsylvania with its mind numbing amounts of water and green vegetation something akin to being on a powerful hallucinate. Now mind you, it was late autumn while I was there, so it wasn’t just the ever present green, but also the spectacular range of gold, red and purple in the trees and plants that led to this surreal feeling.

img_20161105_165718(Rural Pennsylvania countryside)

Where I live in Southern California we have 100 shades of brown, except during our very short spring, when everything temporarily turns green. Pennsylvania on the other hand not only has a thousand shades of green, come autumn is has a million (or so it seemed to me) shades of gold, yellow, red and purple. And as my friend, henceforth to be referred to by his chosen online persona coldwarrior, was more than a little amused to note my reaction to, it has water. Oh lord does Pennsylvania have water. You can’t swing a dead cat without it splashing in water a dozen times.

Southern California is not a desert because its Southern California, its a desert because it almost never rains here. That is the classic definition of a desert, a place where it doesn’t rain. Now mind you, you have to understand that 50 percent of California’s legal residents moved here from the other 47 continuous states. When they moved here, they brought with them, and steadfastly refuse to adapt, their notions of green lawns and lush vegetation, that quiet frankly, have no place in Southern California.

Consequently you often hear the Media babbling on mindlessly about this drought or that drought in California. The truth however, is that those of us who are either natives or have grown up here understand that Southern California never experiences a drought. We do however, every 30 to 40 years experience 10 or 15 years where it rains more than usual. I have lived here in Southern California for 45 years. Our lack of water isn’t because of any drought, its because we live in a desert, and this is what I am used to. The sheer amount of water everywhere in Pennsylvania really was amazing to me. It was like traveling to an alien planet.

Coldwarrior’s parents live way out in the boonies, and I do mean, even for Pennsylvania, way out in the boonies. They have the most amazingly beautiful home. Its nestled in a rural agricultural community perched on the edge of what those of us from California would consider an enchanted forest. Peaking out of that forest from time to time are farms where crops are grown. With river’s and creeks snaking gracefully across the landscape. Hell, there is even a creek directly behind the house and a pond that acts as part of the river flood control system.

img_20161105_112114 (The road to Mister and Misses Coldwarrior’s Parents house)

Mister and Misses Coldwarrior’s Parents are the sweetest most adorable couple evar… Mr Coldwarrior’s dad is a man of few words, quick with a smile and gentle laugh. He spends his time out in his garage puttering around doing man cave things when not doing honey-do stuff. Mrs Coldwarrior’s mom, is the grandmother that everybody wants their kids to have. Yes, she bakes cookies and bread and does all the traditional grandmother stuff. Oh, and Mrs Coldwarrior’s mom makes the Energizer bunny nervous and feel tired. I don’t think she ever gets out of third gear or slow down to below 70 miles per hour.

img_20161106_092840_burst001_cover (The creek behind Mister and Misses Coldwarrior’s Parents house)

img_20161106_092332 (The pond behind Mister and Misses Coldwarrior’s Parents house)

Now my good friend coldwarrior has been home brewing beer for probably the last 25 to 30 years. Dudes home brew beer is literally as good as any Kraft beer you will find anywhere, and better than most major brewery beers. This is no bullshit or exaggeration, it is a straight up FACT. Those who know me, know that I really love a good dark Ale. I am admittedly something of a beer snob. Now this next part is speculation based on impression, not only does he brew an exceptional brew, but he likewise seems to know every brew pub within 50 miles of his home. Moreover, he knows which of their brews are the best.

So, Mr Coldwarrior, the lovely Mrs Coldwarrior and I went Kraft Beer pub crawling. What a delightful adventure that was. The food was wonderful, the beer exceptional and the crowds at each place friendly and congenial. Now, you must understand, you don’t find a lot of really old buildings in Southern California. Its as though we have some kind of compulsion to knock old stuff down and build new stuff every 30 or 40 years or so. Perhaps this is due to the fact that we have earthquakes out here. You really don’t want to live in or work in any building that the earth has rattled half apart.

img_20161109_124317 (those are battered deep fried pickles)

img_20161107_121352 (This is a brew pub and Pizza joint called “The Church Brew Works” which was built in an old Catholic Church)

One of the consequences of this, is that California has a very homogeneous architectural style. You simple do not drive through our communities and neighborhood and see dozens of architectural styles side by side. Pennsylvania on the other hand is like an old patchwork quit of architectural styles, with literally dozens of architectural styles side by side. For a poor Southern Californian driving through the small towns, cities and hamlets of Pennsylvania, with its myriad diversity of architectural styles, well, lets just say their was a lot of neck twisting and “Oh, circle back around the block, I want to get a better look at that” involved.

img_20161107_100244 (A Church where Coldwarrior lives, no, we just do not build like this in Southern California)

To say that my vacation in Pennsylvania was enjoyable would be not merely an understatement, it would be an injustice to the graciousness of my hosts and the great State of Pennsylvania. Since the death of my sister in March of 2015, my brother being diagnosed with stage 4 lung cancer, and then my mother’s death this past September, stress has been building up in me. The mark of a true and genuine friend, is someone who sees you suffering when you yourself do not, and does something about it.

The time spent with Mr and Mrs Coldwarior and their three utterly delightful little girls was not just enjoyable, it quiet literally might have saved my life and certainly my sanity. I cannot begin to thank them enough for what must rightfully be called a medical, emotional and spiritual intervention. God bless you Mr and Mrs Coldwarior, Mr and Mrs Coldwarior’s Parents, and those little sweetie pies of yours. May the Lord Jesus Christ shower you with an abundance of blessing that overflow your cup beyond your wildest imaginations, and may god bless the wonderful and beautiful state of Pennsylvania.