Author Archives: Lila

Hexagram 12: P’i – Stand still, Stagnation

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12 – Hexagram Twelve: P’i

StagnationHeaven and Earth move away from each other.

In the ensuing void, the small invade where the great have departed.

There is no common meeting ground, so the Superior Person must fall back on his inner worth and decline the rewards offered by the inferior invaders.

Difficult trials as you hold to your course.

ANALYSIS

It is natural to assume that, if Earth above Heaven forms the hexagram for Peace and Paradise, then the opposite configuration, with Heaven over Earth would represent the antithesis of Paradise, Hell.
Not so.

This hexagram is actually the Dark side of Peace, its unsavory byproduct, Stagnation.
In a time when most of our wants are provided, there is little need for the heroes, the artists, the great thinkers and innovators.

As they recede into the shadows, Idleness, Apathy, and Lassitude come to the forefront.
Peace has become boring, bland, unchallenging — Stagnant.
Now our attention turns to the quick fix, the instant celebrity, the fad, the one-nighter, the current buzz.

There is no room for depth.

If you are a passionate soul, you must wait for a better time to find kindred spirits. In these times, they are only curious legends, bas-relief, dead poets.

A Question for Off-Gridders

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A reader asks a question about off-grid living:

“I read with abiding interest your article, “Getting off the Grid.” It
was a very nice piece. Presently, I am living in Madison, WI with my kids but I would like to lead my retired life in or near Abbottabad, Pakistan. In fact there is a nice village about 8 kilometers from there which at the end of the mountain (where it is located) it has water, electricity, and
gas. So can I rely on the city for providing me with these utilities on a continued basis or should I dig my own well and use UPS for power supplemental power supply, or maybe a gas generator or both? By the way, how much does a wind turbine cost?”
Khalid.

My Comment:

I’ll post any answers I come across, but meanwhile, feel free to chip in with any advice for reader Khalid..

Totalitarianism: The Total Domination of Man

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From “Evil: The Crime Against Humanity,” by Jerome Kohn

The “total domination of man” was radically evil, in Arendt’s eyes, not only because it was unprecedented but because it did not make sense. She asked: Why should lust for power, which from the beginning of recorded history has been considered the political and social sin par excellence, suddenly transcend all previously known limitations of self-interest and utility and attempt not simply to dominate men as they are but to change their very nature; not only to kill whoever is in the way of further power accumulation but also innocent and harmless bystanders, and this even when such murder is an obstacle, rather than an advantage, for the accumulation of power?
(see “Ideology and Propaganda”)

There is no ready answer to that question. In Hitler’s case it is well known that his unrelenting dehumanization and destruction of those who presented no threat to him hindered his ability to fight effectively against his real enemies at the end of World War II. What is the point of dominating men at any cost, not as they are but in order “to change their very nature”? If it is for the sake of “the consistency of a lying world order,” as she went on to suggest, what is the point of a system that even if it succeeded in destroying the human world would not end in the creation of a “thousand-year Reich” or “Messianic Age” but only in self-destruction? Arendt, to be sure, never thought the suicidal “victory” of totalitarianism likely. That would first require global rule by one totalitarian power, and in that regard she believed that Hitler’s invasion of Russia in 1941 was symbolically significant in spite of his pact with Stalin two years earlier and in spite of the two leaders’ mutual admiration which she emphasized. Moreover, she saw that “no system has ever been less capable [than totalitarianism] of gradually expanding its sphere of influence and holding on to its conquests.” Most important of all, because plurality is the inescapable condition of human existence–“not Man but men inhabit this planet”–Arendt increasingly came to consider farfetched the notion that a single totalitarian regime could ever destroy the entire world.”

China Bubble, China Trouble

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Dominique Strauss-Kahn, the IMF’s Managing Director ended a 6-day trip in Asia by telling Chinese authorities to continue with their stimulus program.

“The main goal is to help with public demand, weak private demand. And the reason why we have to continue with stimulus is because a self-sustaining private demand is not yet visible,” he said.”

He also called for

1) Asian countries to rebalance their economies by becoming less export oriented and fostering internal demand

2) for the renminbi to strengthen to raise household purchasing power and labor’s share of income

Strauss-Kahn said he anticipated Asian growth of nearly 6% for next year (double the forecast for the global economy) and called for Asian leadership in the global financial crisis.

What does this mean?

Let’s start with Eclectica Fund Manager, Hugh Hendry, cited in “Outside the Box” (JohnMauldin@InvestorsInsight.com). Hendry writes:

“Now, if we repeat the Japanese experience then it is possible that nominal US GDP will rise from $14trn today to perhaps just $16trn in ten years time….. The Chinese are building capacity to meet a world where US nominal GDP is $25trn in ten years time. I fear they could be in for a nasty shock.”

That is, the IMF is banking on the remninbi strengthening so that domestic household expenditure can pick up the slack from weakening US consumer demand because there’s huge overcapacity in China.

Serendipitously, just as Strauss-Kahn and the Chinese premier Hu Jintao agreed that domestic demand has to be stimulated, along comes this Bloomberg report that quotes China International Capital Corp. as predicting that Chinese steel demand will rise 12% rather than the 5% predicted by the World Steel Association.

Now, where will the steel go? To a boom in housing construction and auto manufacture.

I blogged earlier that Jim Chanos, the dark prince of short-selling, has declared China a bubble set to burst, on the strength of these mysterious auto purchases that seem to be entirely production driven. One one hand, the government is using its dollars to manufacture cars, demand be damned. But the government has also committed to stimulate demand by social spending (on education and health) that’s intended eventually to make the Chinese loosen up…. and spend on those big-ticket items, like cars and houses.

But there’s an irony in thinking about China’s demand as affecting the commodity market. The irony, says Hendry, is that China is the commodity market.

“Huge demand and numerous small players are a perfect setup for price increases by the Big Three miners, which often cite high spot prices as the reason for jagging up contract prices. But the spot market is relatively small, and mines can easily manipulate spot prices by reducing supply. On the other hand, numerous Chinese steel mills simultaneously want to buy ore to sustain production so their governments can report higher GDP rates, even if higher GDP is money-losing. China’s steel industry is structured to hurt China’s best interests.

The Chinese government is very much wedded to it’s 8% growth target and will do whatever it takes to come close to that target – including flooding the domestic banks with a wall of cheap money to lend as economic stimulus. However, preventing a downturn with easy money is a dangerous way to reflate the economy.

As profitability for the businesses that serve the real economy remain weak, there has been of shift of investment in the first half of 2009 disproportionately into property, stock and commodity markets rather than private sector capital formation. This shift in the medium term threatens to undermine China’s financial stability. Thus, China is experiencing a relatively weak real economy and red hot asset markets.

The Chinese imports that revived the bulk carrier market this year were mostly for speculative inventories. Bank loans were so cheap and easy to get that many commodity distributors used financing for speculation……

Even more foreboding is a looming real estate bubble. The real estate sector in China is especially critical to the bulk carrier market because approximately 50% of Chinese demand for steel is generated by the construction industry. Most Western shipping forecasts are based on unlimited future need in China for new construction. The reality is quite different. China’s urban living space is 28 square meters per person, quite high by international standard. China’s urbanization is about 50%. It could rise to 70-75%. Afterwards the rural population would decline on its own due to its high average age.

So China’s urban population may rise by another 300 million people. If we assume they all can afford property (a laughable notion at today’s price), Chinese cities may need an additional 8.4 billion square meters. China’s work-in-progress is over 2 billion square meters. There is enough land out there for another 2. The construction industry has production capacity of about 1.5 billion square meters per annum. Absolute oversupply, i.e., there are not enough people for all the buildings, could happen quite soon.

…..The nationwide average price [of housing] is about three months of salary per square meter, probably the highest in the world! Consequently, a lot of properties can’t be rented out at all. Those that can bring in 3% yield, barely compensating for depreciation……

Some argue that China’s property is always like this: appreciation is the return. This is not true. The property market dropped dramatically from 1995-2001 during a strong dollar period. Property prices could drop like Japan has experienced in the past two decades, which would destroy the banking system.

Eduardo Galeano on the Nobodies

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Fleas dream of buying themselves a dog, and nobodies dream of escaping poverty: that, one magical day, good luck will suddenly rain down on them – will rain down in buckets. But good luck doesn’t rain down, yesterday, today, tomorrow or ever. Good luck doesn’t even fall in a fine drizzle, no matter how hard the nobodies summon it, even if their left hand is tickling, or if they begin the new day on their right foot, or start the new year with a change of brooms. The nobodies: nobody’s children, owners of nothing. The nobodies:  the no-ones, the nobodied, running like rabbits, dying through life, screwed every which way. Who are not, but could be. Who don’t speak languages, but dialects. Who don’t have religions, but superstitions. Who don’t create art, but handicrafts. Who don’t have culture, but folklore. Who are not human beings, but human resources. Who do not have faces, but arms. Who do not have names, but numbers. Who do not appear in the history of the world, but in the crime reports of the local paper. The nobodies, who are not worth the bullet that kills them.”

— Eduardo Galeano, “The Nobodies”

 

Privacy Watchdog Criticizes Canadian Financial Data Gathering

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In the news, privacy in Canada is on the retreat:

“In her annual report, Privacy Commissioner Jennifer Stoddart says the little-known Financial Transactions and Reports Analysis Centre of Canada must scale back its data gathering.  The centre zeros in on cash linked to money laundering, terrorism and other crimes. Stoddart’s report also raises concerns about Transport Canada’s no-fly list – a controversial program she has cast a wary eye upon for years.”

China Beware: Gold Price Skating on Thin Data (Update)

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Update (November 14, 2009)

This isn’t an update so much as an additional note on the Van Eeden excerpt below.

*Van Eeden has a good track record, but he’s also a disbeliever in any CB or Fed conspiracy to intervene in the markets. Since that intervention is not conspiracy but fairly well-documented, I’m less confident of his opinion.

*Faber, on the other hand, seems to have his ear much closer to the ground.
For instance, he called the RBI one of the best banks in the world on November 6 (see my blog post).

That was just before the Indian bank’s gold purchase. Now, doesn’t it look as if he knew something was coming up? Either that, or he is doing some clever PR for the IMF.

*Faber’s recently (Nov 11) called $1000 the floor for the gold price and has said that it won’t be breached to the downside again.

[However, just a few days ago, on November 6th, he also said gold could drop to $800. I don’t know how to explain this sudden change. It wasn’t the IMF gold sale to the RBI, because that was completed in mid-October and went public on November 3, before both of Faber’s comments].

*Faber argues for much higher inflation than Van Eeden…who doesn’t believe we have inflation..yet.

Now, Faber’s analysis might be overblown, but his conclusion could still be right. Since he’s based in Asia, he could be privy to information that American money managers might miss.

Conclusion: while Faber’s analysis doesn’t seem as sound to me as Van Eeden’s, Faber might just end up being right because he’s factored in market manipulation.

*In response to a reader comment below:- I know Eric Janszen has also called for very high inflation in the 4th Q, which would indicate a high gold price.

************************

From Paul van Eeden:

“The Chinese Communist Party apparently learned from America that debt financed consumption was not a sustainable economic model. Their solution, it seems, is even more absurd: debt financed production in the absence of demand…..

Earlier we reached the conclusion that interest rates could potentially start increasing and cause the US dollar exchange rate to strengthen, which, in turn, would cause the gold price to fall. We can now add that the massive inflation of China’s money supply can cause the renminbi to collapse and send another currency crises rippling through financial markets. A collapse of the Chinese renminbi could also result in a stronger dollar and lower gold price…….

What would happen if China were the epicenter of an economic collapse? What happens when the gold and commodity bulls realize China cannot continue to consume at an even greater pace than it had been when the world was buying its goods, but, instead, now has to work down the excess inventory it built up? It would be a good bet that the US dollar would rally and the gold price would fall.

Given that the gold price is trading at a 25% premium to its fair value and that we can imagine several scenarios whereby the US dollar could rally and the gold price could fall, it seems to me that betting on a higher gold price right now is merely a bet on the Greater Fool Theory.”

Support the Goldstone Report

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Jewish Appeal to Support the Goldstone Report

The primary author of the recently released UN Report on Gaza, the internationally respected jurist Richard Goldstone, has been attacked by establishment voices within the Jewish community. When those within a community try to “excommunicate” and dishonor a truth-teller, it is our obligation and responsibility to speak out vehemently on their behalf and on behalf of the truth they bring.

By all accounts, Judge Goldstone, who has a deep connection to Israel, approached his task with no pre-conceptions about what he and his team would find as they investigated the circumstances and aftermath of the Israeli attack on Gaza. Goldstone is a former South African constitutional law court judge who also served as a prosecutor of the Yugoslav and Rwandan war crimes tribunals. His credentials for this task are impeccable.

For following where the truth led him and releasing a report detailing human rights abuses and violations of international law by Israel, as well as Hamas, Judge Goldstone should be applauded for his honesty and integrity. Instead, he and the report have been viciously and relentlessly attacked by many within the Jewish community.

When it comes to Israel, hard-core censorship and intimidation by those claiming to speak in the name of the Jewish people have been the order of the day. Our saying, “Three Jews–four opinions,” reflects the traditional Jewish encouragement to argue and debate. But the reality, sadly, is that diverse opinions are welcome–except when it comes to Israel.

We must hold the Israeli government and the Jewish establishment accountable for attempting to vilify a truth-teller and for suppressing the truth about Israeli government crimes against the Palestinian people. We call upon each and every one of us to speak out at every opportunity–at our community centers and synagogues, in our homes, in the street, wherever we go.

We must demand that the truth be heard and that those claiming to speak in our name stop manipulating truths that have been well-documented for years, long before the Goldstone report. We are also appalled by the Obama Administration’s reaction to the report. We call for a fair and impartial investigation of the report’s allegations by non-military institutions in Israel. Failing that, we call for an investigation by the International Criminal Court (ICC).

Let us begin the New Year in the pursuit of justice.

Sincerely,

The Undersigned

 

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Forgiveness Without Repentance Is Un-Christian

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Several readers had questioned my rejection of the common understanding of forgiveness as it appears in Christian theology. In response to that, I’m posting what I consider a proper interpretation of forgiveness:

“A very dramatic example of confronting the offenders is seen in the life of John the Baptist, Matt. 3:7-10. Some of those who came to be baptized were clearly suspect and John sent them away unbaptized telling them to get a track record of repentance, then consider baptism. It was not just some words of repentance that John demanded before accepting them, he wanted some action commensurate with the confession to back it up.

In our day and age, we are so shallow in these things, we simply get some quick nod of the head about repentance and baptize them immediately. We would never do what John did, and I venture to say that many Christians are extremely uncomfortable with the fact such action on John’s part is even included in Scripture. It is an embarrassment to many fine Christian people that John did such a thing, and they secretly wish that it had not been recorded.

God expects us to take the right course of action even though it is difficult.”

That’s from the ministry of Gordon Rumford.

I’m quite sure that my philosophical and religious notions are a world apart from Pastor Rumford’s, but on the moral correctness of his position I’m in no doubt. I’ve verified that not just from argument and reasoning, or from the study of comparative religious ethics, or from my own personal experience, but also from lifelong observation of actions and consequences.

These are the real reasons why people think forgiveness can be granted when there’s been no acknowledgement of  wrong-doing, no repentance and no restitution:

1. They’re not reading the New Testament in proper context, but taking passages selectively as they wish. They need to examine the whole texture of the Bible (that is, the Torah) teaching, on which Jesus’ teaching was based.

(Update: I am adding a link here to the doctrine of Teshuva or repentance, expounded by Rabbi David R. Blumenthal, Professor of Judaic Studies, Emory University, as evidence.

Quote:

In rabbinic thought, only the offending party can set the wrong aright and only the offended party can forgo the debt of the sin. ……Teshuva is part of the structure of God’s creation; hence, the sinner is obligated to do teshuva and the offended person is obligated to permit teshuva by the offender.

The most basic kind of forgiveness is “forgoing the other’s indebtedness” (mechil). If the offender has done teshuva, and is sincere in his or her repentance, the offended person should offer mechila; that is, the offended person should forgo the debt of the offender, relinquish his or her claim against the offender. This is not a reconciliation of heart or an embracing of the offender; it is simply reaching the conclusion that the offender no longer owes me anything for whatever it was that he or she did. Mechila is like a pardon granted to a criminal by the modern state. The crime remains; only the debt is forgiven.

The tradition, however, is quite clear that the offended person is not obliged to offer mechila if the offender is not sincere in his or her repentance and has not taken concrete steps to correct the wrong done. Maimonides is decisive on this subject: “The offended person is prohibited from being cruel in not offering mechila, for this is not the way of the seed of Israel. Rather, if the offender has [resolved all material claims and has] asked and begged for forgiveness once, even twice, and if the offended person knows that the other has done repentance for sin and feels remorse for what was done, the offended person should offer the sinner mechila” (Mishne Torah, “Hilchot Chovel u-Mazzik,” 5:10). Mechila is, thus, an expectation of the offended person but only if the sinner is actually repentant. ….

…The principle that mechila ought to be granted only if deserved is the great Jewish “No” to easy forgiveness. It is core to the Jewish view of forgiveness, just as desisting from sin is core to the Jewish view of repentance. Without good grounds, the offended person should not forgo the indebtedness of the sinner; otherwise, the sinner may never truly repent and evil will be perpetuated. And, conversely, if there are good grounds to waive the debt or relinquish the claim, the offended person is morally bound to do so. This is the great Jewish “Yes” to the possibility of repentance for every sinner. “

Lila: Note that this is only one of three levels of forgiveness and it’s the only one that is obligatory, if the conditions are met. The other two levels, selich (approaching the offender with mercy and empathy) and kappar (purification or wiping out of sin, which can only be done by God) are not. Indeed, kappar is impossible for human beings.

2. They’re not placing the Gospel statements about forgiveness in the context of the sound teachings of other religions and of non-religious ethics, with which true religion should not be in severe conflict.

Thus Islam:

“The Arabic word used for self rapprochement is An-Nafs Al-Lawamah which refers to blame oneself and to feel sorry for ones sins. So this is recommended and good in the sight of Allaah and necessary to have the sin forgiven by Allaah.

Ceasing to commit the sin immediately. If the sin was against Allaah, then he should (1) stop doing it if it was an unlawful act, or (2) hasten to do it if it was an obligation that he abandoned doing. And if the sin was against a created being (such as humans), then he should hasten to free himself from it, whether by returning it back to him or seeking his forgiveness and pardon.”

3. They’re not taking into account prudence, reason, courage, and other moral virtues as being as necessary as kindness to moral development.

4. They’re not considering the duality of mercy–judgment, which is a cornerstone of Old Testament teaching (which itself is the foundation of Jesus’ ethic).  Mercy without judgment is not only not correct, it is an impossibility.  This is confirmed from the imagery and symbolism in the practice of magic in the western esoteric tradition, where the masculine form is invoked in contemplating mercy, so that the image of mercy/compassion doesn’t devolve into mere sentimentality. (More on that in another post, as it is a complex topic).

5. They’re disguising their cowardice and their fear of the repercussions of being outspoken, especially toward those more powerful.

6. They’re psychologically incapable of standing up for themselves and in need of therapy to become more assertive.

7. They have an excessive and immoral regard for “keeping peace” at all counts.

8. They’ve been abused or have low self-regard or do not consider injustice to themselves as injustice but part of religiously ordained suffering or “submission,” under authoritarian understandings of the Bible.

9. They have a streak of masochism that derives some psycho-sexual gratification or pseudo-religious exaltation from being injured.

10. They’re using public forgiveness as a technique of persuasion, as in 4th generation warfare (Gandhi was a master of the practice).

11. Their spiritual vanity is so great that they think they can out-Christ Christ, who certainly required his followers to confess their sins and repent.

12. They don’t like the notion of “judgment” and consider it unhealthy.

13. They’re confusing Christianity with some schools (and not the deepest, I should add) of modern psychology.

14. They’re emotionally and psychologically shallow.

15. They’re confusing Christianity with cultural Marxism, in which the notion of guilt and individual responsibility for wrong has been shucked off entirely to structural and societal causes.

Solzhenitsyn: Walk Away From the Gangrene

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Live Not By Lies

Monday, February 18, 1974

Following is the full text of Alexander Solzhenitsyn’s essay ``Live Not By Lies.” It is perhaps the last thing he wrote on his native soil [before the collapse of the Soviet Union] and circulated among Moscow’s intellectuals [at that time]. The essay is dated Feb. 12, the day that secret police broke into his apartment and arrested him. The next day he was exiled to West Germany.

“At one time we dared not even to whisper. Now we write and read samizdat, and sometimes when we gather in the smoking room at the Science Institute we complain frankly to one another: What kind of tricks are they playing on us, and where are they dragging us? gratuitous boasting of cosmic achievements while there is poverty and destruction at home. Propping up remote, uncivilized regimes. Fanning up civil war. And we recklessly fostered Mao Tse-tung at our expense– and it will be we who are sent to war against him, and will have to go. Is there any way out? And they put on trial anybody they want and they put sane people in asylums–always they, and we are powerless.

Things have almost reached rock bottom. …..We fear only to lag behind the herd and to take a step alone-and suddenly find ourselves without white bread, without heating gas and without a Moscow registration……

When violence intrudes into peaceful life, its face glows with self-confidence, as if it were carrying a banner and shouting: “I am violence. Run away, make way for me–I will crush you.” But violence quickly grows old. And it has lost confidence in itself, and in order to maintain a respectable face it summons falsehood as its ally–since violence lays its ponderous paw not every day and not on every shoulder. It demands from us only obedience to lies and daily participation in lies–all loyalty lies in that.

And the simplest and most accessible key to our self-neglected liberation lies right here: Personal non-participation in lies. Though lies conceal everything, though lies embrace everything, but not with any help from me.

This opens a breach in the imaginary encirclement caused by our inaction. It is the easiest thing to do for us, but the most devastating for the lies. Because when people renounce lies it simply cuts short their existence. Like an infection, they can exist only in a living organism.

We do not exhort ourselves. We have not sufficiently matured to march into the squares and shout the truth our loud or to express aloud what we think. It’s not necessary. It’s dangerous. But let us refuse to say that which we do not think…..

Our path is to walk away from the gangrenous boundary. If we did not paste together the dead bones and scales of ideology, if we did not sew together the rotting rags, we would be astonished how quickly the lies would be rendered helpless and subside. That which should be naked would then really appear naked before the whole world.

.. Either truth or falsehood: Toward spiritual independence or toward spiritual servitude….

And he who is not sufficiently courageous even to defend his soul- don’t let him be proud of his`progressive” views, and don’t let him boast that he is an academician or a people’s artist, a merited figure, or a general–let him say to himself: I am in the herd, and a coward. It’s all the same to me as long as I’m fed and warm.

Even this path, which is the most modest of all paths of resistance, will not be easy for us. But it is much easier than self-immolation or a hunger strike: The flames will not envelope your body, your eyeballs, will not burst from the heat, and brown bread and clean water will always be available to your family…….

It will not be an easy choice for a body, but it is only one for a soul. Not, it is not an easy path. But there are already people, even dozens of them, who over the years have maintained all these points and live by the truth.

So you will not be the first to take this path, but will join those who have already taken it. This path will be easier and shorter for all of us if we take it by mutual efforts and in close rank. If there are thousands of us, they will not be able to do anything with us. If there are tens of thousands of us, then we would not even recognize our country…..

And if we get cold feet, even taking this step, then we are worthless and hopeless, and the scorn of Pushkin should be directed to us:“Why should cattle have the gifts of freedom? Their heritage from generation to generation is the belled yoke and the lash.”