Wednesday, April 17, 2013

The Churn

This is going to be a rather heavy write-up, but if you're willing to proceed and read through, please bear with me as I scratch this mental itch I've had for a year now, as I try to put words and "tangible" form to abstract concepts that have nagged my mind for some time now.

We all strive to search for, if not put, meaning to this temporal existence we lead that we have termed as life. As I mentioned in a previous entry, my personal belief is, "Life is in between the human mind's desire for the infinite and eternal, and the human body's regard for its mortality." We interact (whether with ourselves, others, or the world around us) on borrowed time (to whom we borrow it from, let's leave it at that for anthropomorphic aesthetics and literary appeal).

Perhaps the most convenient way in my mind to encapsulate the "situation" we (humanity/people) are in is through the lens of the Social Sciences.

As an excerpt from Wiki (oh noes!):

The social sciences developed from the sciences (experimental and applied), or the systematic knowledge-bases or prescriptive practices, relating to the social improvement of a group of interacting entities.[3][4]

I believe people strive to find meaning and purpose first among people, within a context of a society of independently-willed sentient individuals who are capable of introspective reflection. Hypothetically, for any one person left alone in the wild, exposed to nature's rawest forces and creatures, any purposeful experience outside of an orderly civilization and society, would be merely for the sake of survival, sustenance, and progeny.

The Natural Sciences have allowed man to harness and take advantage of the rules and resources of our Universe. We keep measuring everything we have defined and define anything we discover, but the Universe will move on, even when devoid of any sentient life, and even after the last sentient thought of humanity fades (and the field of human biological sciences will disappear with us). With this in mind, "Social Sciences is where it's at." Even if the exercises seem more like celebratory cherishing of humanity's existence and an expression of self-proclaimed relevance, the fields of Social Science will allow us to understand this Churn I have given term to.

History and Economics are probably the most likely fields among the Social Sciences that will help me give form to the Churn. Before anything else though, let's put context to this discussion. Interestingly enough, the History Channel released this TV special entitled "What's the Earth Worth": and it's obviously just a very educated estimate at $6.87 Quadrillion, but more than anything, it's a monetary value determined through humanity's consensual perception (or at least to those who are in agreement with the amount arrived at based on what the benchmark or reference point was for the pricing methodology).

The video was taken down =\, but you can always look for it: 
History Channel: What's the Earth Worth

A few hundred years ago oil and rare precious metals wouldn't have had any value worth buying or bartering for at all, but it's the need for these resources that have transformed the paradigm in commerce.

The Merriam-Webster site defines Economics as

a social science concerned chiefly with description and analysis of the production, distribution, and consumption of goods and services  

I went through high school and college being taught the concept that Economics deals with the efficient allocation of scarce resources. Well, from the looks of it, at $6.87 Quadrillion, there's plenty for everyone after all given the abundance of resources. However, the wheel wasn't built with a perpetual pension fund for everyone in mind. Capitalism after all is a carrot and stick hamster wheel. We live in an economic regime of price and relevance. There is no "end game" after all. If we identify the certainties of life, these would be taxes, death, and change (pitch in some other stuff if you like, but to be concise these are the three most people recognize). I think change (and struggle) define the biological and sentient beings that we are, as I have posted in my previous entry, The Paradox of Imbalance:

“Because systems at equilibrium are at a minimum of G and can do no work, a cell that has reached metabolic equilibrium is dead! The fact that metabolism as a whole is never at equilibrium is one of the defining features of life.”

and these statements have come from a Biology Book by Campbell on just the subject of Metabolism (that I may or may not have over-read)!

Change entails one more aspect that Economics gives significance to, standards of living. Sure we can go about our lives living in caves, eating whatever edible plants or animals we come across with, and live off the extremely bare necessities of life, but with civilization comes issues regarding the quality of life, longevity of life, and even luxury. Corollary to these carrots of course is the emergence of something we have termed as ambition and aspirations.

Having laid the components out, we can actually imagine how the hamster wheel has been set-up. While far from being egalitarian, this institutionalized system of encapsulating how to deal with what each individual wants to draw out from society for himself is formalized. It brings civility to the exercise of "fighting" over scarce resources (which aren't scarce at all apparently), while also encouraging ambition, innovation, risk-taking, industriousness, hard-work, greed, creativity, determination of purpose, among other traits and objectives people have set-up for themselves in such a limited span of years. We have substituted this type of mechanism as opposed to encouraging war, rape, pillaging, and other forms of conquest that seems like a natural extension of hard work (well I suppose warring, raping, and pillaging can still be hard work) for the sake of one's self, his group, or his nation.

This economic mechanism is precisely how the standards of living of human civilization has been able to avoid developmental stagnation, through innovation, adventurism, risk taking, and entrepreneurship.

I think, inherently embedded in our socio-economic system that keeps the hamster wheel in motion and keeps people to push through the struggle is what we know as inflation. Text books define it as a rise in the prices of a defined (btw, people in authority define the contents of the index based on what they see in society) basket of goods and services or as an expansion of the fiat money supply in circulation. I have always seen inflation as merely the "atmosphere that envelops the battlefield" as people fight over "scarce" resources. If a person doesn't work harder and get a better pay grade, there's a risk of him being swallowed up by his diminishing purchasing power as the prices of goods and services go up. I suppose it's a humane way of sentencing someone to death, as it eats away on a person's capabilities to buy stuff and avail of services, from the heights of luxury down to the basic necessities for human survival.

Interestingly enough, I regard the late Tupac Shakur as an economist. He knew what he was talking about (even at the street level), when people at the level of society he was part of tried to get by and push through the struggles of life. Despite songs that seemingly cherished lives filled with illegal activities, it was an up and close depiction of how the world works and what a person is capable of or what he had to do when chasing that carrot for a better tomorrow.

Staring at the world through my rearview
Just looking back at the world, from another level you know what I mean?


Multiple gunshots fill the block, the fun stops
Niggaz is callin cops, people shot, nobody stop
I wonder when the world stopped caring last night
Two kids shot while the whole block staring
I will never understand this society, first they try
to murder me, then they lie to me, product of a dying breed
All my homies trying weed, now the little baby's
crazed raised off Hennesey, tell me will my enemies
flee when they see me, believe me
Even Thugs gotta learn to take it easy, listen
Through the intermissions search your heart for a plan
and we turnin Bad Boys to grown men, it's on again
I give a holla to my niggaz in the darkest corners
Roll a perfect blunt, and let me spark it for ya
One love from a thug nigga rollin with a posse
full of paranoid drug dealers, to the end my friend

I'm seein nuttin but my dreams comin true
While I'm starin at the world through my rearview (see)

(They got me) starin at the world through my rearview
Go on baby scream to God, he can't hear you
I can feel your heart beatin fast cause it's time to die (we)
Gettin high, watchin time fly, and all my motherfuckers

[Phil Collins:]
And I can feel it coming in the air tonight, Hold on
I've been waiting for this moment for all my life, Hold on
Can you feel it coming in the air tonight, Hold on, Hold on

Now I was raised as a young black male
In order to get paid, forced to make crack sales
Caught a nigga so they send me to these overpacked jails
In the cell, countin days in this livin black Hell, do you feel me?
Keys to ignition, use at your discretion
Roll with a twelve gauge pump for protection
Niggaz hate me in the section from years of chin checkin
Turn to Smith and Wesson war weapons
Heavenly Father I'm a soldier, I'm gettin hotter
cause the world's gettin colder, baby let me hold ya
Talk to my guns like they fly bitches
All you bustas best to run look at my bitches

Now I know the answers to the question, do dreams come true
Still starin at the world through my rearview (I say)

(They got me) starin at the world through my rearview
Go on baby scream to God, he can't hear you
I can feel your heart beatin fast cause it's time to die
Gettin high, watchin time fly -
and all my motherfuckers/nigga can die

Back in the days we hustled for sneakers and beepers
Nine-six for glocks cause fiends hittin up blocks with street sweepers
Bless myself when knowin rules to these streets, somethin I learned
in school, on some Million Man March shit for the piece/peace
True that, only one life to lead, a fast life of greed
Criminally addicted, infested since a seed
We all die, breed bleed like humans, towns run
by young guns, Outlawz and truants, shit's deep
Turn eighteen, burn my will when I go
Burnt my body with my shotty, or chosin my dough
So while you reminiscin all nights out with the crew
Smoke a blunt for me too, I'm starin through your rearview

Hahahaha, you ain't knowin what we mean by starin through the rearview
So since you ain't knowin what we mean let me break down understandin
The world, the world is behind us
Once a motherfucker get an understanding on the game
and what the levels and the rules of the game is
Then the world ain't no trick no more
The world is a game to be played
So now we lookin at the world, from like, behind us
Niggaz know what we gotta do, just gotta put our mind to it and do it
It's all about the papers, money rule the world
Bitches make the world go round
Real niggaz do they wanna do, bitch niggaz do what they can't

Starin at the world through my rearview
Go on baby scream to God, he can't hear you
I can feel your heart beatin fast cause it's time to die
Gettin high, watchin time fly, ya know/and we'll be
[x4: with vocal fade]

[Phil Collins:]
I can feel it coming in the air tonight, Hold on
I've been waiting for this moment for all my life, Hold on


The magical regime of price and relevance to my mind expands the paradigm through which we all live in. Given advancements in technology and logistics, there's only a few reasons why we can't bring some form of good or service through a straight line, from point A to point B and this is already probably apparent with online shopping and other commercial activities. In any case, in the regime of price we live in, everyone involved has a cut out of the pie, a few cents here and few dollars there, just so everyone gets some type of work done, something "earned" out of the activity, and goes home happy/satisfied. Middlemen, commission-ers, eggers-on, marketers, and other seemingly unnecessary parties to a transaction justify (in one way or another) their relevance to the deal and their appropriate share from the price. The justification of relevance itself is an exercise of survival and of earning a living within the hamster wheel. Sure, we can cut-off the excess fat from a deal, but it's tantamount to taking away jobs. If we look at the music recording industry during the emergence of the digital age, it was losing huge chunks of revenue from illegal downloads online, then in one way or another, to stop the hemorrhaging, it found a compromise through online distribution facilities (like the Apple Store, where we can buy and download songs at .69/.99/$1.29 cents a pop). Of course the whole ordeal was already in place anyway, so a lot of middlemen and promoters probably lost out on their share of the price-pie.

While we're on the subject of the music industry, what economic role or contribution do artists and entertainers provide anyway (this is probably also true for other performers of the arts, writers, and even athletes)? It's interesting to me though that as abstract as their craft, products, and services are, they are a form of escapism and of course entertainment for everyone else. They are, after all, bastions of the "arts and humanities'' (and athletics). Moreover, what's apparently special for entertainers and some athletes is the life they live to display for the world to see. It's a reinforcement of ambition and aspirations among people. It's an implicit invitation to go after a better life (that unfortunately often promotes envy and greed). Ordinary people would instantly think how anyone could afford these luxuries and why would they NEED excesses to the basics. The display of opulence has its relevance in the system, even if seemingly awful in reinforcing materialism. Materialism after all helps keep everyone busy with some sort of purpose or relevance, whether truly integral to a process or merely a niche role.

While I did post a feature on Carlos Slim's home, people can easily point out that Warren Buffett lives a simple and humble lifestyle, but in any case, that's not the whole point I'm driving at. Warren Buffett's persona himself as a story of success who has earned billions is already an invitation for ambition and aspirations. In fact, any rich fellow can opt to live a simple life and it's a luxury in itself to have that choice to limit the opulence, but the guy at the gutter level of the system cannot have that choice.

I am amazed at how marketers and ads-people get to carve out their relevance in the system by inducing other people to consume goods and services that most of the time aren't necessary at all. Their abstract skills to make things seem relevant, induce demand, encourage consumerism and materialism, and manipulate perception are a wonder in capitalism. Heck, they actually give jobs to laborers, who would otherwise be stuck making all the unavoidable and ''necessary'' stuff for humanity. Why not make a useless novelty product? Why not build silly things that some dude would be willing to squander his money on because it's ''cool''? While it seems all too sneaky, it also gives other people jobs, as they work on seemingly irrelevant goods and services, that people would have otherwise passed over. There are so many things that people can live without, but are produced anyway, just because in one way or another, whether due to the machinations of marketers and ads-men or not, have stroked people's egos, hit insecurities, or inflamed desires to give color and individuality to an otherwise dull and streamlined life. This ad/marketing revolution, I might add, is the fuel that keeps Internet commerce (and even its existence) running. I mean, those administrators, servers, wires, cables, and other hardware that make-up this network of networks (i.e., the Internet) aren't going to pay for themselves. Thank you capitalism for Advertising Budgets!

And what is the point to all this "customization" of people's lifestyle when we live with a limited lifespan anyway, that after some time, people move on as others pass away? As I enjoy watching Pawnstars, The American Pickers, Storage Wars, American Restoration, Auction Hunters, (I haven't watched any Barter Kings episode yet), there's something that I've come to conclude about the regime of price. Aside from the concepts of Demand and Supply, of Rarity and Oversupply, it's the perception of the need and the price, which is often very true to collectors and people who feel like they need to possess some tangible form of history and something related to their personal memories. And come that Estate sale for these items, you know the bargains are going to pop-up, because the perceptions of the heirs don't necessarily come from the original owner/deceased. If we talk about the margins, above the basic cost that it took to produce something and considering the availability of the good or service, prices are often flexible and are influenced by perception.

If indeed there's an abundance of raw materials to make goods (as shown on What's the Earth Worth), then how are baseline prices of extracting these resources determined? There are mercantile exchanges that comprise the financial markets and demand and supply help the markets find that equilibrium price of compromise between buyers and sellers, but in the spirit of Louis Bacelier's Theory of Speculation, between buyers and sellers, someone has to speculate, make a move, take risks, and take a position. There is the idea of perception working in the minds of free-willed independent decision makers. To highlight the idea, if everyone knew what the outcome of a deal was or what the resulting price of a stock would be in 3 hours, then everybody would just be sitting tight; holders of the stock won't sell it until a certain price is exceeded, and buyers of the stock won't buy into the stock until it's cheaper than what the apparent price expectation is in 3 hours, so it would apparently be a quagmire. So neither party would make a move, but the world is ever changing, it is a certainty of life, perceptions of people change based on what their minds process amid the environment and other people's actions, so under the context of making decisions to earn money, speculations occur and risk taking happens. These are all influenced by individualized perception, if everyone had the same perception, then no one would be in disagreement as to how something should be priced and no deal or trade ever occurs in a situation like that.

This is probably also true with Gold being a precious metal that most cultures have found valuable. It isn't edible for sustenance and in no way should it even have value to basic survival of a biological being, but perception (probably because it's shiny) and history of civilization has reinforced it's value as a commodity. Whether we live in a floating interest rate regime with fiat money or the Gold standard, it's still all about perception of what the value of things should be. Apparently, people are in search of credible benchmarks against which other things should be compared to and valued with. Given drop-down interest rates, "money is cheap" because people can borrow at a cheaper consequence of paying the interest, but beyond that is the atmosphere in the paradigm - of encouraging risk-taking and churning out more money that people can fight over with whatever activities they attempt to engage in. The Churn itself is a rinse and repeat process that will extend longer than what one or two generations can observe. Before the pattern of rinse and repeat is realized, the older generations would have died off or have arrived at their twilight years, that it wouldn't even have mattered. Governments, their sovereign debt, and their taxing power are of course longer in their existence, but the decisions of one generation's government are also tied with the decision-makers and politicians of today, and are destined to experience the rinse and repeat cycle in any case. The experience of Europe (the financial and monetary burdens of the members of the EU) is a migration of the standards of living to Asia. After all, the system and The Churn is an induced mechanism of appropriating resources to where things are most relevant. Capitalism is about Demand and Supply, efficient allocation requires resources to be put where they should be. While I do not have any data or metrics, it can certainly be said that in Asia, labor is cheap and overtime and extra exertion at work is common place. I do not know what type of working environment and experience Europe has, but apparently the sacrifices of the past generations of Asians have allowed allocators of resources (the markets) to take notice that they can stretch their money and earn more if they invested in the Asian Region. The heavily-subsidized and socialist programs of Europe of course have taken their toll on their sovereign finances (a lot of freebies).

I have not done a more in-depth analysis of the situation and it's probably up to the readers to arrive at better conclusions, but in any case, the illustration here is how government policies can be maneuvered while a gestation period is set in place (intentionally or unintentionally) and while the citizens of the populace (with their limited life spans - below 100 years) are subjected to the circumstances of the situation. Rarely do current generations reap the benefits of change instantaneously. Call it the trickle down effect, the lag of execution or whatever in any case, people will have to deal with what they are put in when they belong to a system. Loopholes to the system are one way that a person can get ahead, if it's illegal then they have to pay with jail time and other penalties. After all, we merely play with the cards we are dealt with. And that's probably important to note, the WAY that we play with the cards we are dealt with. In the end, The Churn was designed with economic distribution in mind. It's in someway streamlined to work already. Beyond that, however, it is up to people to fill in the void of finding meaning to their existence, to find an authentic purpose outside of what the system of the Churn wants us to believe is our true purpose, i.e. educate ourselves, find a job, work for the economy (and for one's self, group or family), raise a family, raise a child (an economic component), retire, RINSE AND REPEAT. I think in between those seams and gaps of the Churn is where the excitement is. It is a path of self discovery in someway, once the distractions of what the Churn is supposed to be are set aside. I really need to buy this:

and finally start with this Astrophotography hobby I've been procrastinating on for so long.

All compositions, statements and opinions of the author are copyright © Earl T. Malvar 2009-2013. All rights reserved. There is no honor, respect, admiration, intellectual and academic dignity garnered through plagiarism.