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Restoring Order

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The violence in Baltimore has gutted the city far more than can be seen by charred hulks of cars and buildings. A general riot like this demonstrates how a complete breakdown in order is always close to the surface – and how “order” itself is always a manufactured concept. It has to be made, it has to be worked at by everyone every day. It is hard work sometimes, too, and it starts with basic civility and respect.

Ask anyone in Baltimore, especially in the affected areas, if they are surprised by this. I doubt you’ll find a single person who is. Baltimore City Council Member Brandon Scott cited “a long, long, longstanding issue with young African-Americans.” It was a long time coming, and it will be a long time before it is repaired.  But away from the teevee cameras there is a genuine movement, and it will be better.  It’s going to take your help, however – even if you live far from Baltimore.

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From Net Collector to Payer

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We’ve discussed many times before how the Federal Reserve sets the interest rates for everything from used car loans to mortgages to savings accounts across the US. The task has always fallen to the Federal Reserve Open Market Committee (FOMC) and its “Fed Funds Rate”. As far as anyone can tell they perform a calculation based on the prevailing conditions as to what the optimal rate should be. They balance out the need for more jobs (favored by cheap money, or low rates) with a desire to keep inflation in check (with high rates) and a rate is published. From that baseline for the cost of no-risk money a premium is added by a bank based on the risk (low for a mortgage, high for a used car) or subtracted (the value of savings) and all is good.

Except for one small detail – that mechanism has been horribly broken since 2008 when every calculation suggested the optimal rate was below zero. As long as rates are near zero and there’s a flood of cash in the financial world (not that you are getting any) we have what’s known as a “liquidity trap”. And the way interest rates are going to be set in the near future is going to turn on some far more obscure things such as the “Reverse Repo Rate”.

Yes, it’s complicated.

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A Holiday, Together

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Happy Tax Day! If it doesn’t feel like a holiday, consider this – you are obliged to count up all your blessings from the previous year and spend time doing something you don’t entirely understand or enjoy all that much. If you’ve really procrastinated, like me, you may have to take off work. But if you haven’t filed yet, here is your last minute advice from Barataria: stop screwing around on the internet and file already!

This is an even more special day than your typical holiday because Tax Day means one thing to Americans everywhere – we all get to complain. Bitterly and constantly. Rather than whine about the amount of taxes, however, it seems more appropriate to take note of the incredibly complicated and expensive way we go about collecting the money that is necessary to run a government. It costs between $160 and $234 billion just to prepare the paperwork, or about as much as the feds collect in corporate taxes.

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The Race is On!

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It became official on Sunday. The 2016 Presidential election cycle is fully underway now that there are candidates in both parties. We have 19 months of this to look forward to, so if you are underwhelmed now it might be best to find a cave to live in. As the sometimes hilarious satire site “The Borowitz Report” put it, “The two major political parties’ unconscionable waste of money officially commences this weekend, as Democrats and Republicans will soon begin spending an estimated five billion dollars of their corporate puppet masters’ assets in an unquenchable pursuit of power.”

Why care? If not for the spectacle, you might want to care for the simple reason that whoever becomes the next President may become an American icon through the blessing of really good timing as this depression winds down into a potential new golden era. It’s all about managing inevitability for Clinton, something that she appears to be doing a much better job of all around.

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Logistics

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“Amateurs talk strategy, experts talk logistics.”
– Common US Army saying

Barataria has been discussing some of the key skills and perspectives that define the next economy with an eye towards teaching them to the next generation that will need them the most. Cooperation in competition is certainly rising in importance in a higher technology world, as is the need for a flexible workforce  and a greater reliance on automation.

All of these come together with a greater need for strategic thinking, and its related leadership models, but are executed with the great challenge of a time when everything moves faster every day – the art and science of logistics.

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