5 Relationships Of Raw Materials To Money
Everything we use from this planet to live …
… comes in the form of Raw Materials.
Those who harvest nature’s bounty to provide Raw Materials for human society need to be able to do so without acquiring debt . Otherwise, if providing Raw Materials cost more than it paid, it would not be sustainable and providing Raw Materials becomes impossible.
Those who provide Raw Materials must be able to afford all the finished goods and services they require from the sale of the Raw Materials they produce. Otherwise, they could not continue to provide Raw Materials and survive.
(I know I repeated myself in the above 2 paragraphs. It is an essential point and I did not want it to be missed.)
The Price Level of Raw Materials determines
the amount of Free Currency in circulation.
Free Currency is Debt Free Money.
We’ve had Debt Free Money in the past, Free Currency, once upon a time in the United States of America.
Those who provide the finished goods and services to Raw Materials producers must be able to do so without acquiring debt. Otherwise, providing finished goods and services to Raw Materials producers would not be sustainable and it becomes impossible to provide finished goods and services to Raw Materials producers for very long.
Those who provide the finished goods and services to Raw Materials producers must be able to afford all the Raw Materials, finished goods and services they require from the sale of their finished goods and services. Otherwise, they could not continue to provide finished goods and services to Raw Materials producers and survive.
Those who provide finished goods and services to anyone are paid,
either directly or indirectly,
by the Raw Materials producers.
Having enough debt free currency to allow for the total debt free exchange of all finished goods and services depends upon the price level of Raw Materials.
It is not enough that farmers, fishermen, foresters, miners and recyclers make enough so that they may start a new production cycle, live long and prosper. All those who add their labor to animal, vegetable and mineral Raw Materials to produce finished goods need to make enough so that they, too, may start a new production cycle, live long and prosper.
(I’ll get to the service providers a little later because I feel they require more clarification and differentiation.)
The bottom line is that the price paid to Raw Material producers determine the amount of debt free money available to human society. The amount of debt free money available for personal savings and business investment is determined by the price of Raw Materials.
Here is a five part description of how Raw Materials relate to Money.
- Debt Free Currency
- A society’s annual production of raw materials must be represented in the economy by a sufficient amount of debt free currency (a price level) to optimize the debt free exchange between the raw materials producers and the finished goods and services raw materials producers purchase.
- Those who produce the basic raw materials for society must be paid enough to afford the manufactured goods and services required for raw materials production.
- This amount of debt free currency in free circulation must also be enough to optimize the debt free exchange of all manufactured goods and services at all subsequent stages of the economic cycle.
- Debt Free Exchange
- The amount of wealth in flow within the economic cycle must be represented in the economy by a sufficient level of debt free currency to permit the debt free exchange of all finished goods and services.
- Without enough debt free currency to meet the need of debt free exchange an economy stagnates and dies.
- Finished Consumable Goods
once produced and warehoused, must be monetarily represented somewhere in the economy by more than their minimum domestic labor value equivalent in free currency, so consumption of finished goods can occur without supplemental debt or abstinence from consumption. (a surplus of production in the midst of poverty) - The Volume of Debt Free Currency
available to distribute current production and facilitate the subsequent expansion of commerce is governed by the value placed on raw materials at the first point of sale. - The value of raw materials becomes the primary source of personal savings and business investment.
Human society cannot sell under-priced Raw Materials into a high priced retail market without replacing the underpayment with:
- capital debt
- interest driven inflation
- abstinence from consumption and
- a high rate of unemployment.
Governments and the FIRE (financial, insurance, real estate) industries know this and have known this for a very long time. Yet, these service providers have a verifiably long history of repeatedly screwing things up.
Some services I understand, such as education, entertainment and medical services. These seem reasonable and easily affordable if government and the FIRE industries did not cost so much and actually make things worse by repeatedly screwing things up.
I cannot believe that the world’s wealthiest and most powerful individuals with access to the best education repeatedly screw things up by accident. This whole thing concerning Raw Materials and money must go much deeper than the current financial meltdown and scandal.
The reason just about everyone else, including economists of all sorts, are giving more complicated explanations seems to be their need to retain all the rank, honors and privileges bestowed upon them by governments and FIRE industries.
Somehow, their rank, honors and privileges must be justified and maintained while explaining why things are screwed up. It is then no surprise that explanations become complicated.
To make things even more confusing, libertarian economists say things like:
“The governments of almost all countries are engaged in a campaign against the capitalists. They are intent upon expropriating them by means of taxation and monetary measures.”
-Ludwig von Mises
Now, Capitalism emerged as the dominant means to separate products from their producers subsequent to the general collapse of manorial feudalism during the Great Plague. Manorial feudalism gave us serfdom, bondage to the land, land owned by some big mucky-muck.
(I say general collapse of manorial feudalism because land bondage continues in the Southern United States with tenant farming, the foundation of Southern agriculture since the Emancipation Proclamation.)
In Europe, during and after the Great Plague, big mucky-mucks could not get enough serfs to do all the work, so they invented Capitalism to pay people to work. The plan was to pay people less money than what their products could be sold for.
The difference between the cost of Labor and the value of the products determined the amount of profit because Raw Materials costs had already been fixed.
The big mucky-mucks, AKA Capital, already owned everything, all they needed was a system to get people to work for less than their labor was worth.
(Well, they, Capital also needed a system to keep everyone in line. I get to that part a little later.)
In business, Capital is everything that is not Labor or Raw Materials. Capitalism just privileges Capital relative to Labor and Raw Materials, that is why they call it that.
This development meant that the big mucky-mucks, Capital, needed to find a way to have Labor pay for its own management. The old days of just getting a big guy with a whip to oversee the serfs were over.
Managers from the ranks of the workers themselves seek superior privileges over the other workers they manage. They are allowed rank, honors and privileges to the extent they are successful in profitably separating producers (workers) from their products (the job).
Successful managers are allowed to call themselves Capitalists to signify their usefulness to the system named for them, the Capitalist System.
Capitalists often internalize the system point-of-view through close identification with the owners, the big mucky-mucks, Capital. This mental construct then conflicts with their actual (negative survival potential) position.
Capitalists seem easily confused when the Capitalist System acts to collect the fruits of other people’s production. After all, that is the very reason it was invented.
Capitalists forget they are workers themselves, workers used to more profitably separate products from their producers. Capitalists are central to a system that must pay for its own management because the owners, Capital, does not produce anything of value to sell.
Capital, another name for the power behind the system’s infrastructure, claims its rank through national governments’ sanctioned cartels and monopoly control over Raw Materials. Capital is control over Raw Materials cloaked in status derived from military strength and the proven willingness to use it.
Capitalism is simply a system that privileges Capital over Labor (including management) and Raw Materials. Capitalists are simply specialists in separating products from their producers, Labor, for the benefit of Capital.
It is not that Capitalists are on the wrong side,
Capitalist are the wrong side.
The big guy with the whip who used to oversee the serfs now needed to be paid, just like everyone else in the Capitalist System. Capital invented the rank, honors and privileges of Sheriff just for him.
Sheriffs were employed to evict people from the Commons (common lands) where they paid no rents. With the Commons closed, people were forced into the cities for factory work so to afford rent.
The Security State Apparatus, a necessary part of Capitalism, descended from this role of the Sheriff as compliment to the Capitalist. The workers are assessed for the cost of being kept in line, policed, for the safety and security of Capital, Capitalism, Capitalists and the Capitalist System.
The cost to workers for their own management by Capitalists and the Security State Apparatus, that is, the cost of both separating them from their production and keeping them in line, is paid for by the workers themselves by means of taxation and monetary measures.
This is monitored by a Union enforced Labor hierarchy entrenched in government bureaucracies. The government itself legitimizes and defends the Union, giving it great political power, in an obvious case of conflict of interest and self-dealing.
Debt Free Money,
Free Currency,
comes directly from the sale of Raw Materials.
When Raw Material producers, those who produce finished goods from Raw Materials and those who provide desired educational, entertainment and health services can afford to live on Free Currency, Debt Free Money, then everyone in human society lives long and prospers.
The big mucky-mucks, Capital, using Capitalists and a Security State Apparatus monitored by government bureaucracies loyal only to their in-house Union, makes huge profits on debt. These huge profits come at the expense of Raw Materials producers, those who produce finished goods from Raw Materials and those who provide desired educational, entertainment and health services.
Debt is a fabrication of governments and the FIRE industries.
- Debt enslaves individuals and entire populations,
- enslaved as certainly as a chattel slave during Roman times
- enslaved as certainly as a serf under manorial serfdom
- enslaved as certainly as anyone coerced into doing something they truly do not want to do.
That is the relationship of Raw Materials to money.
First 4 Steps To An Online Business
Recently, a woman expressed a concern to me that she had “nothing going” and needed to rely on another person. She felt insecure to the extent she was dependent and asked me what I thought she could do.
The resources for a brick and mortar business just were not available and she knew enough about the online world to think she could get “something going” online. Undecided about specific niches in her broad general areas of interest, she “got going” by creating an online persona.
Her first 4 Steps were:
- Purchase a domain name and blog hosting and set up an email address for the persona
- Use the persona email address to obtain a Google user-name and password for the persona
- Use the Google account to create a YouTube account for the persona
- Create a Twitter account for the persona
This seems like the essential groundwork required to begin vblogging or video blogging. The technical requirements appear minimal, especially regarding media production with the technology getting simpler every year.
Producing a stream of content remains one absolute requirement. This one requirement shows up everywhere online.
Do not blog if you are not a writer.
Do not vblog if you are not a videographer.
If you can get past the 2 month hump, then you have the 6 month hump and the 2 year hump. You get past the humps by being productive.
The possibility of Jumping The Shark looms as a constant threat.
Being productive may include any activity that produces more value than went into it. Some people, for example, make money online by selling artisan food products.
The next step involves understanding and working with Key Words. Since I feel the topic of Key Words deserves its own article, I’ll leave that for later.
Significantly, we currently see 4 dominant methods to enjoy Internet Traffic.
- Pay for advertising using AdWords, Pay-Per-Click advertising, banners or any other method that involves you paying for traffic before you sell anything.
- Affiliates and Joint Venture Partners send you their traffic and their payment comes from a percentage of the purchasing customers they send.
- Organic Search Engine Traffic, notably from Google these days.
- Leveraging Social Media and Social Bookmarking sites.
In my mind, their relative desirability ranks in reverse order to my listing. One could start with Method 4 and never need to try anything else.
If you do your part with being productive, Method 3 should take off before Method 4 peaks. These two methods will give you the proof needed to interest useful Affiliates and Joint Venture Partners.
Until you can prove your production sells, useful Affiliates and Joint Venture Partners will not be interested. Once you prove you have a winner, Method 2 can increase your income dramatically.
If your product successfully sells online, then Affiliates and Joint Venture Partners will be interested. Paying for advertising may never become necessary.
With the above 4 Steps in place, you will be in the position to publish content online. Your content will create a following.
Once you have a following you will be ready for the next steps and that will take another post.
In the mean time
check out my article about:
- Mike Masnick
- Seth Godwin
- Trevor Reznik
and the articles by Yaro Starak
Leave your questions in the comments and I will answer them there or in a new post.
Run Faster Than The Slowest Camper
The bear is out of the woods and the bull is running for cover. Forget about out running the bear, that is never going to happen. I will tell you why in a second.
All you really need to do is run faster than the slowest camper.
96 years ago, December 23, Woodrow Wilson used four gold pens to sign the Federal Reserve Act into law. This act is arguably the most destructive and harmful law enacted by a United States President up to that time.
The Federal Reserve Act allowed the inflationary bubbles that created the snowball of debt that currently engulfs us today. Nothing is at all mysterious about inflation;
inflation is government intervention pure and simple.
This proves the lie of the myth that regulators actually regulate rather than serve the interests of corporate beneficiaries. Debasing money is an old trick of governments going back at least as far as Biblical times.
15And when money failed in the land of Egypt, and in the land of Canaan, all the Egyptians came unto Joseph, and said, Give us bread: for why should we die in thy presence? for the money faileth.
16And Joseph said, Give your cattle; and I will give you for your cattle, if money fail.
17And they brought their cattle unto Joseph: and Joseph gave them bread in exchange for horses, and for the flocks, and for the cattle of the herds, and for the asses: and he fed them with bread for all their cattle for that year.
18When that year was ended, they came unto him the second year, and said unto him, We will not hide it from my lord, how that our money is spent; my lord also hath our herds of cattle; there is not ought left in the sight of my lord, but our bodies, and our lands:
19Wherefore shall we die before thine eyes, both we and our land? buy us and our land for bread, and we and our land will be servants unto Pharaoh: and give us seed, that we may live, and not die, that the land be not desolate.
20And Joseph bought all the land of Egypt for Pharaoh; for the Egyptians sold every man his field, because the famine prevailed over them: so the land became Pharaoh’s.
21And as for the people, he removed them to cities from one end of the borders of Egypt even to the other end thereof.
Genesis 47
What happened in Egypt is that the grain harvest was deposited into the secure government storage facility. The government then issued script (money) against the grain reserves.
When the government wanted to spend more than they could back up with grain reserves, they just went ahead and printed up more script anyway betting on ever increasing harvests to make the script good. Of course, with crop failures not only was the inflated script no good, in that it never had backing, but the original script could not be redeemed for grain either because there was none.
Fiscal policy cannot stimulate the economy.
The government has no money of its own.
It has only the power to tax and spend the money of others.
Financial collapse and food collapse have proven to be the consistent downfall of empires throughout human history. I write about the food collapse a little bit further down but first I want to touch upon the evidence of the advanced fear the government exhibits toward the governed.
Of course, since war has been declared upon United States citizens with the War On Drugs that allows the United States government to set new international records in the both the percentage of the population and total numbers of citizens that have been sent to prison by their own government.
The few shreds of the Bill of Rights remaining after the War On Drugs have now been completely obliterated by the subsequent War On Terrorism. The government appears so on edge that any excuse seems provocation enough to justify A Visit And Subpoena From Homeland Security.
The U.S. government fears and wages war upon the U.S. governed for reasons similar to why the Israeli government fears and wages war upon the Palestinians. Neither government would expect anyone to sit still for the wholesale fraud and abuse they dish out for very long.
They wish to avoid judgment and the consequences of their actions, also spelled out in the Bible.
1Go to now, ye rich men, weep and howl for your miseries that shall come upon you.
2Your riches are corrupted, and your garments are moth eaten.
3Your gold and silver is cankered; and the rust of them shall be a witness against you, and shall eat your flesh as it were fire. Ye have heaped treasure together for the last days.
4Behold, the hire of the laborers who have reaped down your fields, which is of you kept back by fraud, crieth: and the cries of them which have reaped are entered into the ears of the Lord of Sabbath.
5Ye have lived in pleasure on the earth, and been wanton; ye have nourished your hearts, as in a day of slaughter.
6Ye have condemned and killed the just; and he doth not resist you.
James 5
When the wealthy cheat farmers out of what the farmer is due the financial system tanks regardless of the unjust wars the wealthy wage.
This truth from Biblical times held up as a key point concerning the Fall of the Roman Empire and still holds true today. Truth seems to endure even if empires do not.
Closing the ‘Collapse Gap’:
the USSR was better prepared for collapse than the US
Despite appearances, we are not merely revisiting old mistakes. Our very way of life has been transformed into dependency upon an unsustainable system now running out of resources.
Die-off is a bottom-up phenomena affecting the lowest rungs of the human socioeconomic ladder first. This is already happening at a scale that is increasingly impossible to ignore.
Spiritual Leaders, scientists, climatologists, anthropologists and leading researchers unsuccessfully try to convince humanity that our self-destructive path is the true root cause of the collapse.
Prepare now.
Prepare now by becoming productive in your own name. Prepare now by connecting with people who appreciate your products.
Those who cannot connect with a personal fan base will be without the opportunity to sell their products directly. Lacking that opportunity, the only recourse will be self-reliance and self-sufficiency.
A lonely path at best.
No More Pretending
Delusional hope produces nothing of value. Throughout my life I have sought to see things as they are. The past few months have provided me the opportunity to ponder current events against the tapestry of history.
“We have destroyed the Holocene biosphere, and it can never be rebuilt. We have inadvertently terraformed Earth into a different planet. This act cannot be undone; it is thermodynamically irreversible.” Desdemona
I leave it to climate change deniers to explain the recent wholesale collapse of fisheries with the increase in both reef and oceanic dead zones, the desertification of the world’s most productive land and the rapid transition from forest to desert by mega-fires.
The once frozen “methane bomb” has already gone off. The Arctic permafrost is already melting.
Large areas of Earth are becoming uninhabitable to mammals and their food plants. Most charismatic megafauna, such as elephants, rhinos and whales, will become extinct in a few decades. It is entirely likely that humans will follow them into oblivion.
For sure, this will be a bumpy road to total collapse and a few will manage to arrive in luxury SUVs. The rest of us, the vast majority, will see family and friends fall as we circle the drain together.
There are still resources that could be directed towards easing the necessary scaling back of empire and civilization as we know it. Scaling back in and of itself would help a great deal, perhaps forestalling human extinction as we adapt to an Earth that every day becomes more like Mars.
While President Obama takes on the ‘fat cat’ bankers the underlying collapse of the United State financial industry has yet to be addressed. The root problem is an excessive level of debt in the system at all levels, a level of debt that exceeds capacity to pay.
The problem in a nutshell – the banks are still hiding losses – big losses. Very little of the debt securitized by the housing bubble has been written off or yet foreclosed upon.
Loans are not being made to small business people because they have no collateral to pledge. Being asked to pledge personal assets as collateral for a small business loan is standard operating procedure.
With most homes underwater, most small businesspeople have no assets to pledge as collateral. Debt problems go beyond the largest banks.
China bought zero U.S. Treasury debt in October. Now foreigners have become net sellers of U.S. Treasury debt instruments.
The problems began when raw materials producers stopped receiving parity pricing and needed to borrow in able to start a new round of production. A principle method of under-paying, paying less than parity, appears in the form of paying in debased money.
Meanwhile, here we are, nearly a year under a new administration. For feds, more get 6-figure salaries, in an attempt to keep up with debasement of U.S. money.
Seduced And Abandoned
Both Democrats and Republicans demonstrate a history of saying whatever seems required to become elected, seduce the electorate, and upon election conveniently explaining away or otherwise abandoning their earlier promises.
Everyone seems to condemn this behavior between individuals. The victims often appear unable to disengage on their own initiative. If fortunate, their family and/or friends provide counseling and intervention to help end these cycles of abuse.
Yet society as a whole suffers serial victimizations by these two mainstream political parties. Ever since the Reagan Administration identified government as the problem the resulting orgy of deregulation and bureaucratic bloating continues unabated from one election to the next.
Some wish to call them incompetent idiots. Others wish to call them lying frauds. I suggest we make peace and call them incompetent lying idiot frauds.
The system they destroy also provides all the wealth and power expended in the destruction. Literally self-destruction. It seems an entire spectrum of pathologies plague our financialized government.
Narcissism
Borderline Personality Disorder
Characteropathy
Sociopathy
Psychopathy
Witness the unnecessary pain, suffering and death. Unnecessary because it results from a financial services industry that compounds debt exponentially inevitably demands more wealth than the total sum of raw materials entering the economy.
Unnecessary because the government fails to enforce the Prompt Corrective Action Law and administers regulation in the interest of the financial services industry contrary to the interests of citizens.
This occurs simultaneously with a prison industry growing faster than it can expand, militarization of local police forces, the historic first ever active deployment of U.S. Armed Forces within the United States of America, de facto nullification of the Bill of Rights and an overall heightening of domestic security.
I hope you are debt free and likewise free from any form of wage slavery. At least that can give you a running start.
HR 2749 Punishes Small Family Farms
Without Theory No Revolution
Glenn Maresca felt compelled to speak up and I am honored to make his views publicly available. He has a song that relates to this, The Quiet Revolution.
Glenn Maresca writes:
Here we have yet another phony food safety bill, which does NOTHING but grant the FDA massive new police powers without actual policy oversight. And it would do NOTHING to solve the actual problem, the stinking cesspools which call themselves “modern” factory farms, the SOLE source of whatever filth there is in our food supply. We don’t need burdensome new tracing regimes to drive small farmers out of business, we already know exactly where the problem is.
H.R. 2749 would give some FDA administrator (read self-serving corporate lobbyist) the power to dictate what farming practices must and must not be used nationwide (read enforced GMOs, growth hormones, and weird chemicals in our food). How can Congress make sane policy without identifying the specific problem and its source before empowering 10 year criminal sentences and $100,000 fines? It can’t. But only if we stop them from doing it, by speaking out now.
This hideously ill-conceived bill (unless you are a chemical food conglomerate) is so terminally vague about what its PURPOSE is, it can only do massive harm and no good whatsoever. Aren’t bills in Congress supposed to start with some kind of preamble, something like, “This is the problem we have identified, and this is what has to be done to fix it and WHY.” No such forethought in HR 2749, just unlimited and unaccountable new police state powers, while President Obama continues to appoint the WORST possible nominees for just about every administrative position.
It’s time to wake up folks. It’s just one corporate power grab hand over fist out there. Not ONE major bill has Congress passed yet since the last election that did ANYTHING to confront the actual real problem. Credit card so-called reform was some kind of sick joke on the American people, rejecting the only provision that actually mattered, constraining usurous interest rates. Has anybody seen any BIG savings on their credit card bills yet? Did we have to ask?
And they TRYING to do the same thing with health care reform, to do nothing to disturb the existing corporate medical industry gravy train. It is ONLY because of the alerts we have done on this already that single payer is actually getting a hearing. What kind of lunacy is it when the plan supported by a majority of the American people is not even allowed in the room? It’s the lunacy that happens when more of us do not speak out more often. And we’ll have another alert on that later in the week.
But for today, please speak out against HR 2749. Tell Congress to directly regulate factory farms and them ONLY. That’s all that has to be done. And anything else they do that does NOT do that by definition will only make the problem worse, by punishing those who are NOT huge, filthy, factory farms.
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