Tuesday, November 22, 2011
Memo From ICAB
M E M O R A N D U M
TO: CITIZENS OF THE WESTERN WORLD
FROM : ICAB - INTERNATIONAL CITIZENS ADVICE BUREAU
DATE: AUTUMN OF DISCONTENT 2011
Dear Citizen of the Western World,
Although you've probably noticed, evidenced by the numbers of you have been camped in dirty underwear, without privvies, in various public places, even as winter approaches, we have some bad news for you.
1. Most of us are poorer than we realize.
Whether personally as an asset owner whose share of The Tab hasn't come fully due, or as an ordinary citizen where the State's claim upon your future cash flows hasn't been fully applied, or as creditors where the haircut (s) have yet to be fully imposed or negotiated, or as retirees or future retirees whose promises of future cash flows (or the age at which you retire) are unlikely to be fulfilled as previously believed in like quantities or relative purchasing power, you are worse off than you currently believe or realize. How much so is anybody's guess,but its probably MORE than you imagine though LESS than the Goldbugs fear. Accordingly, we recommend that everyone include an F-Factor Discount (technically known as a Fudge Factor) when totaling our individual net worth statements and begin adjusting to the idea when imagining one's next holiday in the sun, luxury kitchen refurbishment, or leveraged purchase of the latest Vorsprung durch Technik.
2. Most of us will continue to get poorer in real terms.
There are more than 7 billion people on the planet, many of whom would gladly do what most of us do for less and for longer. Much less. And they are. And they will continue to want, and do so. Some of course are unable, due to obvious limitations of geography, nonetheless, the inexorable downward pressure upon wages and (at least over the next few decades) Malthusian upwards pressure upon resource prices will continue to squeeze us. If one is a consumer, and one is accustomed to consuming significantly more than one produces, this will be rather unfortunate. Life, however, is full of choices and undoubtedly all people so pressured, and without a fairy godmother, or a very well-funded trust fund holding good title of hard and/or solvent assets, must face them. Do not believe demagogues who promise that in the absence of producing something of value which others desire or require and can trade for/pay for, that we do not or will not have to make such choices, however big or small. We will, whether the markets force us by austerity and subsequent deflation, or whether they arrive via eventual inflation as a result monetization. So in preparation, we advise everyone to please start thinking about what is most important to you, and your family. Hints: Food (the veritable kind); Decent Affordable Healthcare; Public Order: Education; Safe Bicycle Routes, More Efficient transportation, Drinkable Wine, perhaps, but not necessarily in that order.
3. We are suffering from a variety of maladies.
Whether or not we realize it, most of us are ill. Many are suffering from a form of Financial Phlebitis (known as Vastly Enlarged Expectations), both in terms of what, and the quantity of which we think the World (The State, Your County, Municipality, Parents, Employer, Union, Children, Deity of Choice, etc.) owes us, and what we think is deserved by virtue of our annointed presence on this planet. Some of us suffer from behavioural disorders such as Self-Attribution or Hindsight Bias' that causes one to discount the impact of one's luck (dumb or otherwise) or society's contribution towards one's success, possibly coupled with a tinge of Sociopathic Grinch''s Disease. Still others amongst us (for the avoidance of doubt including but not limited to: Bankers, the Auto Industry, Big Pharma and other rent-seekers) have a form of Financial Munchausen syndrome. Together, these afflictions threaten everyone's health, not to mention law, order, stability, and welfare. We recommend everyone take steps to confront their own particular disorders and attempt to self-heal what they can which begins with the arrest of self-delusionary behaviour. For those amongst us who are adept AT helping themselves, but are seemingly unable TO help themselves, we will be offering special group therapy for such financial kleptomaniacs called "Looters' Anonymous".
Fortunately there is some good news. For most of us, it will (once Euro systemic adjustments are enacted) likely remain safer, and more pleasant to live where we are (excepting those of us in Blighty or the bowels of certain US Cities) than in most developing cities and countries. For Americans, our land and our corporations are rich, our people innovative resourceful (when the mood strikes) and adaptive (errr when forced). Our higher education system (ex Bob Jones U) is still the envy of the world, and there remains enormous low hanging fruit (from infrastructure, investment in energy efficiency, and wholesale healthcare reorg, education urban renewal, progressively higher marginal tax rates) to help transit from where we are to where we ought to be in order to sustain a reasonably healthy stable civic and economic life should we find the pragmatic will (which we highly recommend) and the leadership. For Europeans, our lands, heritage, and patrimony are rich, our expectations are suitably moderate (except in Blighty), our savings are large across all of our nations (excepting Blighty), our households underleveraged (except in Blighty), our companies technologically fit, our aggregate current and trade accounts are in rough balance, our healthcare systems efficient -enough in cost and outcomes, and our educational systems of good quality, affordable and meritocratic (except in Blighty). The gaps we must respectively bridge, while different, are neither insurmountable nor even a huge distance from where we presently are. But the time for dithering, aversive or avoidance behaviour has passed, and ask all of us please, be one idly rich, merely fortunate, a farmer or worker, shareholder, civil servant, pension beneficiary, manager, teacher or student to act pragmatically, and in the better interests of ALL of our children.
International Citizens Advice Bureau