August 17, 2015

The cashed-up new collectives

Posted in Irish Independent · 48 comments ·

This morning in a small Croatian village my family partook in something called ‘Radna Akcija’ (Work Action). This is a throwback to communist times in Yugoslavia when everyone in the village was expected to “muck in” and help build something for the benefit of the village. In the old days, this may have been building a road, helping extend the water supply, digging the channels for a new sewage system or simply cleaning up after a village party.

This type of communal activity glued the socialist system together and older villagers wax lyrical about the sense of community and the bonds these Radna Akcija initiatives created. The people are proud of the infrastructure that they built for themselves. As a result, they keep up the tradition every month. It’s like a turbo form of our own Tidy Towns.

Interestingly, we know that humans like to share and collaborate.

The ability to share, inform, exchange ideas and therefore organise through language is what propelled humans into poll position in the animal kingdom.

The entire idea of storytelling is the notion of sharing experiences. Where do you think the great Irish expression, “Come here till I tell ya” comes from?

We like to involve others in our world, to talk and exchange ideas. A sense of humour is nothing more than sharing your own funny ideas and hoping to get a laugh. Humans have always shared ideas and we have always collaborated for the greater good.

The Yugoslavian communists exalted a greater force – the notion of the moral superiority of the collective over the individual. But this collaborative model wasn’t conceived by Karl Marx; it goes right back to Aristotle, who first observed that “the whole is greater than the sum of the parts”. When people collaborate and share, there are enormously positive things that can come from such endeavours.

As I watched all this collaboration in Dalmatia and the use of people’s time, abilities and tools, I thought of the recent news about Airbnb in Ireland where the Revenue are in cahoots with Airbnb to tax the income people are getting from renting rooms, flats and houses.

The news underscored just how many people are involved in the likes of Airbnb right now. It seems that in the past year Airbnb has grown very quickly indeed. I know loads of people renting out rooms and apartments on Airbnb, and I have stayed in two Airbnbs this year alone.

At its essence, Airbnb isn’t so different from what the villagers were doing this morning, except it’s a capitalist version.

The thousands of Irish people renting out rooms are an example of a new form of economy – the sharing economy.

The sharing economy is going to change the way we live because the sharing economy offers society an opportunity to use stuff that we are wasting – such as an unused room – and, at a personal level, the incentive is income in a cash-strapped economy.

Crucially, this potential income isn’t something new, it’s just converting a wasted resource into cash. What can be more attractive?

An unused resource is a wasted resource.

Karl Marx understood that, at its heart, the consumer economy is grotesquely wasteful, but his solution, rather than being Aristotlean, was brutalist.

Communism preferred confiscation over collaboration and, as a result, ended up with the truly bizarre situation that the whole was actually less than the sum of the parts because lots of the parts were seized and sequestered before they could be shared.

All this is now changing. The mass use of the internet – all three billion of us internet users – has opened up a new way in which the waste of individual consumption can be shared and reused over and over.

This will profoundly affect income, GDP and living standards.

In the past we could only share with people we knew. Now with platforms like Airbnb – as well as eBay, Uber and Kickstarter – we can create second-hand or shared value and we can generate income out of nothing.

The new sharing economy, exemplified by Airbnb and Uber, will be transformative. We are moving from individual consumption towards something that is called collaborative consumption.

To get an idea of how much waste individual consumption generates, think about your car.

Did you realise that on average in the developed world a car will be idle for 92 per cent of the day and night? This is a monumental waste and a huge financial and environmental cost to all of us.

Is it any wonder that Uber is exploding all over the world given that it turns the unused car into an income stream?

The sharing economy isn’t just a new form of taxi driving or a glorified version of the old-fashioned B&B. It is going to become an entire economic ecosystem built around the sharing of human and physical resources.

It includes shared creation, finance, production, distribution and trade. At its heart, the sharing economy could become the core of environmentally friendly capitalism driven by the three Rs: recycle; reuse and repair.

The Revolution is already here.

A report in April by PricewaterhouseCoopers said that five sectors in the sharing economy could see their combined global revenue jump from $15 billion to $335 billion by 2025 at the current rate of growth.

The areas referred to were: travel, car-sharing, finance, the jobs market and music- and video-streaming services.

PwC also cited one of its surveys as showing that 18 per cent of adults in the US have participated in the sharing economy as a consumer, and 7 per cent as a provider.

The future will be a shared one. Fancy it? Why wouldn’t you?

  1. Mike Lucey

    Subscribe! Someone is having a lay-in:-)

  2. Mike Lucey

    In rural Ireland this concept was know as a ‘Meitheal’. Its not so popular now days with contractors and such but was a common way farmers got their buildings erected and harvest in on on time.

    The NET plays a huge part in the modern day Meitheal, support forums for example. I am heavily involved in SketchUcation, a SketchUp users support site and forums with 380K membership. I am often fascinated at the amount of help total strangers undertake to help ‘Newbies’, often involving hours of their time.

    • Deco

      Many years ago a political office holder on 350 K started lecturing us on “meitheal”.

      The superficiality of the office holder, and the many houses owned, were too much for more people.

      There was no “meitheal” coming from the political class. Or indeed the state system.

      I think it destroyed the usefulness of concept.

  3. DB4545

    The future is here already David it’s just not widely distributed yet.Not my quote but life’s too short for attribution or harvard referencing systems. The challenge is to prevent public or private sector highwaymen from stealing/misallocating the wealth of the cashed-up new collectives.

    I’ve been staying in an apartment within an italian palazzo for the last five days courtesy of the airbnb system.It’s artfully and tastefully furnished and overlooks terracotta tiled rooftops and all the dishevelled elegance and streetscape that you’d expect of Italy.

    This mansion is certainly a long way from the only mansions I would have known in my youth the hopelessly(or cynically) misnamed Fatima Mansions.No I haven’t won the lottery this is the family holiday at a total budget below two weeks packet deal in puerto del carmen in lanzarote.I suspect I’ve done what you and a lot of other families are doing this summer(judging by the families walking with 10kg bags).Research hard and live easy by getting a better bang for your buck.

    I hope my cash is paying the heating bills or medical insurance or education of the grandchildren of the nice old lady who owns the place. But I’m here because of price and value not altruism.And I suspect that given the creative abilities of Italians over the centuries 52% of the money I paid will not altruistically make its way to the Italian tax authorities.

    I sincerely hope the Irish tax authorities find a way in their heart to show similar creativity or Ireland and Irish Citizens is going to miss out on this little goldrush.

  4. Deco

    WE already have a “sharing” economy.

    People sweat and toil, and share the proceeds with gamblers, when the gamblers lose the private capitalist gamble on Anglo Bonds.

    In fact, we are “punching above our weight” with regard to this sort of behaviour.

  5. Deco

    The Irish Tax authorities and “sharing”. A bit of a sarcastic joke really.

    You work as hard as you can, and then “share” half the proceeds with them. It is compulsory. You do not even get the opportunity of thinking about it. And then everything you spend is taxed. And if you try to save for the rainy day, that is also dis-incentivised.

    In fact just about every activity is punished. Except those pertaining to crime, corruption, bribery, fiddling company accounts, sucking out of the state system, and being a reckless banker.

    • DB4545


      Economic activity outside the existing mindsets is discouraged with a vengence because it’s difficult to toll by government or corporations. But we can continue to curse the darkness or try to light a flame Deco the choice is yours.

      Poverty is not a lifestyle choice it’s a mindset and that includes a poverty of imagining different outcomes. The mindset is accepting the crumbs instead of taking your slice of the cake in the way that’s possible for you.If enough people take away the crumbs from the people who try to hurt us vested interests no longer have more than their fair share.

      Think about it the next time you open your wallet and act accordingly.Or keep cursing the darkness.

  6. Deco

    It will work in Croatia. And maybe in rural Ireland. In urban Ireland there is far too much deceit. And in my lifetime the level of deceit has increased.

  7. Ironically there is only tax required to be paid if there is a cash charge. Volunteer labour or labour provided in an exchange where no cash is involved does not attract taxes, yet.
    The new economy (or not so new)is an exchange of services. Barter is back with a vengeance. Here on the Brinkworthy estate is a community starting to provide for each other. Helping out the neighbour with a free job and being gifted some fresh vegetables, while not broad based is happening. Surpluses are thus transferred to others with less. All benefit as it is voluntary rather than coercive.

    Now if we can only get rid of the greedy, corrupt and corrupting central bankers there would be a lot more to share around. The interest they extract from the debt based economy is graft pure and simple, illegal in any other business form, and leaves poverty in its wake. No wonder people feel oppressed. By whom they have not yet figured out. When they do watch out, there will be an explosion in economic and social sharing.

  8. Poverty dressed up as a lifestyle choice is what you are describing there, David. It scarcely merits talking about. Feel free to exhale now.

  9. Pat Flannery

    Now if only we could devise a way of distributing micro electric energy. There are so many ways of producing electric power on very small scales, e.g. exercise bikes, all we need is a distribution system and we have the environmental problem licked. All technology advances are mute if we destroy the biosphere, as we are currently doing.

    Maybe the emerging areas of collaboration David describes above will lead us to the real prize of collaborative energy production. We are awash in personal energy which is 99.999% wasted. All we need is an IP address for our individual energy account with an upload/download protocol for energy micro bits. Now that would be real‘Radna Akcija’.

    • DannyG

      I wouldnt like to be waiting for the bike powered kettle to boil, might take a few hours :-)
      Micro eletric smart grids are on the way though, the combination of solar and new battery technology epecially will change the energy landscape. This will also revolutionise transportation.

      • DannyG

        If only Ireland could somehow create community energy generation cooperatives like in Denmark where communities own and operate wind farms. We could be self sufficient. I can’t see it happening though, I don’t think we don’t have that collective/common good mentality.

        • There was an article in Bloomberg this week about the new Danish EU Commissioner and her reference to the first Danish co-ops.
          The issue in Ireland might be that as per Kerry etc, the members would want to eventually cash out once they reached a certain scale….

    • Mike Lucey

      @Pat Flannery

      Just learned about ‘SunPort – Demand Solar. Anywhere. Instantly’ and remembered your post. SunPort is a Kickstarter campaign that allows folks to use solar energy via a specialised socket / application. Its initially being targeted at the USA and if successful then other countries

      The link is here,

      I signed up for the $2 pledge in order to get email updates. Maybe, just maybe, there might be a way of getting such a system into Ireland for ‘user demanded’ solar and wind power ….. early days yet but one can hope.


      • Mike Lucey

        Maybe its incidence but I’ve just read about Google’s new Project Sunroof which calculates rooftop solar potential using Google Maps!

        Initially they will be covering Boston and San Francisco then the rest of the US and then on to the world. It will empower ordinary folks with information which will allow them to make a ‘green’ decision or not.

        Of course this information is readily available on the NET if one knows where to look but the ‘Google It’ factor will most definitely drive momentum.

        Here is a video about the project,


      • Pat Flannery

        Mike Lucey,

        Almost a fifth of total power consumption today is in DC because all electronic devices and LED devices use DC only. But to satisfy that demand we are currently suffering huge energy losses by converting from AC to DC. Just feel the heat generated by your AC/DC converter. The “brick” makes a nice foot warmer.

        As a result of those losses large campuses are starting to link their solar arrays (that produce only DC) to DC “microgrids”. This not only saves the conversion losses but encourages the use of solar.

        The growth of data centers (which are just large computer farms) around the world, as those being currently planned in the West of Ireland, will deploy large centralized converters rather than individual mini-converters (as we ordinary consumers are currently being forced to do). This will give cloud-computing the edge. And that is before data centers produce their own DC from renewables like wind and biomass.

        The next stage will undoubtedly be where cities will follow the example of data centers. The demand for DC household appliances, which are perfectly feasible, will grow. One thing for sure, the use of DC will grow.

        As for converting mechanical power to electrical power you might check out this Kickstarter project, bike power:

        It reminds me of the old bicycle dynamo of my youth before lamp batteries become cheaper and more efficient. There is whole new energy economy waiting for a midwife, if the Irish are up to the task.

        • DannyG

          Large scale batteries will link power generation, transportation and holdhold consumption together.

          consumer goods won’t change to DC until there is fit for purpose supply which can only come from a battery because electricity consumption and solar availability will never be in harmony.
          All these token mini storage solutions are not real life practical and usually have a very long payback, this is before you get into the issue of standardisation of the products.

  10. We have a “self help” club here on Salt Spring Island. All club members are expected to do their bit. The original bondholders bought the property and set to work and together built the docks for the boats they owned.

    $0 years later the tradition continues with over 250 members contributing to work parties 3 or 4 times a year. All positions are voluntary. All work is ‘collective”.

    The result is a large modern marina with the annual moorage costs a quarter of the commercial rates in the region. In addition local members have reciprocal rights at 50 other clubs in the Washington state and BC southern coast.

    Club members can cruise and use facilities at other clubs for a nominal 5-10 dollars a night restricted to a few nights a year at these places.. Not a government regulation in sight in this except for the Coast guard required safety at sea regulations.

  11. A cashed up collective may be the only part of the economy correctly operating as the rest collectively crash.

  12. “Financial writer and trader Gregory Mannarino predicts that big debt defaults are coming. Mannarino contends, “We are starting to see this with Greece and Puerto Rico here. It’s everywhere. This is a global problem and it’s going to engulf the world. This debt problem is going to swallow the earth. They have done this on purpose. They cannot be this stupid. . . . They are doing this on purpose and there is going to be no soft landing. It is a global issue and it is going to implode.”

    • DB4545


      We know. You’ve partly converted me.You have me fully up to speed on ponzi schemes and the part a partial gold standard has to play in the world.Now tell us about Canada in the greater scheme of things and the positive attributes of the culture.Kind and respectful regards.

      • DB4545
        Canada is a vast and disparate country with many cultures extending from Nova Scotia to Vancouver Island 4500 miles away. Plus 2000 miles of more North to South. I have travelled a little in BC and across the Prairies, but not for a while.

        Attitudes have changed over the years and what used to be is no longer. I have spent most of the last 45 years in and around Victoria BC.

        I am happy to give you my thoughts on any particular things of interest to you.

  13. [...] The cashed-up new collectives – David McWilliams [...]

  14. george

    I totally share Deco’s cynicism.
    It’s a real joy to read his comments, which I find “spot on”.
    The only thing that changed from the Renaissance up to now, is the technology.
    But unfortunately, the System that governs our lives or the MAL-TRIX, as I call it, is still being controlled by parasitic Governments and Public Administrators, bad Banks, bad Corporations, and the Elites, that exert their control and mantain the “status quo”, mainly through the Educational System and the News.
    We are only sheep in the human farm, mostly (DMW is one of the exceptions) being fed total lies.

    • DB4545


      When a cynic smells flowers he looks for the coffin so sometimes it can be more productive to just remain a sceptic. The elites have always been with us George just like any other rodent. Sometimes it’s our own laziness by leaving out too much food for them.With few exceptions nobody is going to hand over their wealth regardless of how they they accumulated it.

      If you’re smart enough to understand how the world works and you are then realise that most people are no different to you and me. We’re co-operative when it’s in our self interest but otherwise we’re ruthlessly self interested.Like a burglar if you can’t get through the front door there’s some way of getting to your objective.

      On the up side most of us are not searching for food in rubbish dumps like some people in the third world so we have first world problems.Most people of my social class would have been dead at 40 after a short brutal backbreaking life barely 150 years ago in a world devoid of running water,sanitation or meaningful healthcare.

      Look at your own background and I’m certain you’ll find similarities.So things are on the up.One difference I’ve found is trying to find your own way to act on your instincts or beliefs. I try to stop feeding the bastards.

      • george

        OK DB4545 I should have written “Deco’s scepticism”, which I totally share with him and others! I don’t have time now to answer the rest, but I will as soon as possible.

        • george

          So then Greece is now the third world, within the first world. And the people who jumped from balconies in Spain, because their apartments were repossessed by the Banks, with the help from the political establishment, were plain lunatics. And we should feel happy, because we have better working conditions, than people in Eastern Europe, Africa, and Latin America. Or polish, german, and spanish unemployed people in Mallorca, or other parts of the EU, sleeping on the streets, and eating in soup kitchens.
          Unfortunately the regression in social and cultural terms is obvious. The EU is a mess, with a set of social policies for one country, and another set for others. There is a third world here in Europe, that nobody wants to talk about, specially the media. And there is a third world out there in the larger world, as a direct consequence of the policies of the first world. Iraq has been totally destroyed, by a supposedly “very caring and intelligent” first world. One and a half million people were killed over there, and their infrastructure obliterated. Libyans are trying to flee a country, that the first world said it was going to save. One thousand five hundred people (1.500) were drown, up to this month of 2015, in the Mediterranean Sea, in coffin ships. Greece got this week alone 23.000 (twenty three thousand) refugees! Syria is in a total mess, as a consequence of the same First World’s “know how” methods. And most of the news you read in the media, are only intended for brainwashing the population. An Iraqi professor of Arabic studies teaching in Madrid, has said recently, that in Saddam’s times, the problem of Shiites and Sunnites didn’t exist at all. And that it came out, as a direct consequence of western intervention, mainly from USA and Britain, in the area. And he cannot understand the way Europe is acting.
          We know we cannot trust the political system, because politicians are full of privileges, and palies of big Corporations, Banks and the Elites. If after what happened in Greece, anyone still have much faith in the political system, I think they need to see a therapist. Little people and ISMEs pay more and more taxes every day, while Banks were saved with public money from generations to come (no wonder they want people to have more kids), and Multinationals get exemptions of every type and can shift profits from here to there, while most of the political establishment look the other way, and small businesses are over regulated and choked with taxes. And the Elites can decide if they reside here or there, so they pay as little taxes as they want.
          Why the Land League doesn’t get much time in the media, showing us the real drama taking place in Ireland with evictions? If after all this, there is people that get satisfaction thinking that they are better off than their Romans counterparts of the past, I think it’s time to switch off the TV for good. I did it two years ago, and now the Government wants to bring a multimedia tax, so even if you don’t want to watch it, you’ll have to pay for it, to “support local production”, that in many cases glamorise drugs and crime… the fact that we export some rubbish doesn’t make it good or acceptable! And I don’t “watch back” at it, even in Internet. The same government (this one or one to come) that it’s not going to interfere with Multinationals, The Banks, or members of the Elite, in case they run away, even if they are ready to promise it at election time. So now and then, they’ve no other solution, than to come out with few tricks, to get more money from the rest of us, plain workers or small entrepreneurs, that have earned money working very hard, and not writing useless reports for which some get big salaries, lump sumps, long holidays, fat pensions, and even have spare time, to lecture the rest of us, about cooperation. I’m among the lucky ones, because basically I’ve all my basic needs covered, but still what I see around me makes me sick!

          There is nothing wrong that governments decides to incorporate the earnings people get from “airbnb” or similar enterprises for tax purposes. The problem is that honest people don’t trust the governments any more. Basically they know governments are terrible administrators, and see them persecuting the small guy, while allowing big Corporations and members of the Elites to pay very little taxes, practically non direct taxes at all, and allow Banks as well to play with people’s future, even evicting families from their homes. So I personally see Governments, Banks, Multinationals, and the Elites that control the Mal-trix, as an impediment to human progress for all the people, of all the nations. And everything could be change with good governments, that acts as it should do, for the common good. But we’ve seen enough of it, to know that everywhere in the world, governments are controlled by powerful elites, that control everything else. JF Kennedy was a member of the elites, but when he decided to warn humanity and act independently, he was murdered. I think Pope Francis being a Jesuit is also part of the elites, but now he is acting independently, trying to do something for humanity. I don’t think that we are basically the same, and that we should compare them, with Donald Trump and others like him. There is good and there is evil, and there are suckers as well!
          In this way, the world is heading for another big disaster, and the only thing we see from the people that are in control of the Mal-trix, are some cosmetic changes that are not enough.
          The new thing that they are trying us to believe, is that the future of humanity is in Mars, and that it is a marker of human evolution!
          For God sake give me a break!

    • Deco

      George, you are 100% correct.

      We are part of a system, where deceit is rampant. Money, and power are the imperatives that drive this deceit. There is a relentless effort to grab more of both. That is the defining characteristic of the society within which we live.

      These relentless demands are wrecking society, and causing a relentless momentum that will not yield until society is on the floor.

      In the end, there will be war. And then after war, civil war, and rebellion and perhaps revolution.

      If you look at pre-revolutionary societies, from Royal France, to Tsarist Russia, to China before Mao, you will see expensive wars, corrupt establishments, a malaise, a lot of pretention about being civilized, and centralized state systems that by their very nature generated an aggressive inner opposition that simply could not be controlled.

      Societies where the rich feel vulnerability, and lie to the middle classes, inevitably end up at war. Because their inner control mechanism needs augmenting under a false pretext.

      Any pretext will do.

      • george

        Deco, I only wish, you keep up the good work! Most of the times you are “spot on”.
        I’m a humble disciple of yours. Cheers!

  15. I was thinking about wasted resources.

    Particularly the car. Sure I use it for fractions of the day. What a waste. BUT when I want to go somewhere, like the store for groceries, to the club for a sail, or a couple of screws to finish a job, I jump in the car with no wait, it gets me their quickly and efficiently without any waste of time.

    Talking of the spare room which is storage or for guests I considered the main bed , the only one I use for 40% of the time. I could advertise for a hot bunk mate who would work a night shift and sleep during the day. II do not spend hours standing around waiting my turn to use or hours walking.

    20 plus years ago on a trip back to England I was going past a store and spotted a shoe sale. I bought two pairs for 35 pounds. They were middle road construction with leather uppers and glued on rubber soles. Brogues, (Brogans in the US) in a manner of speaking.The following year I bought the similar shoes for 25 pounds for two pairs. They are still in use with minor repairs for maintenance. The problem is I have other shoes I wear. I have rubber Wellington boots I use seldomly when it rains. I have water proof work boots I wear daily, I have slippers I wear occasionally, sandals I wear maybe at the beach or around the house, I have boat shoes for the boat, boots for the boat, and another couple of pairs kicking around. I am obviously over shod and need to find others to share my shoes preferably while driving my car on the way to and fro from my bed.

    It reminds me of a suit I had made in 1962, made to measure. A total waste of money at the time as it cost me 40 pounds and I could have bought lesser material for half the money. That suit is a Royal Navel Blue serge (black) 3 piece and made with large seams and was conveniently let out an inch or two here and there and I still wear it on occasion. It is now known as the funeral/wedding suit and is occasionally unwrapped yet again just to see if I can still fit, weddings and funerals being few and far between.

    What a waste (or is it waist in my case) as it is unused 99% of the time. The trouble is I cannot find anyone else who will look after it as I do nor will it fit them to wear.

    This is just a sample of things I use and I am obviously not ready for fully cooperative living. However I do my bit at the sailing club in a cooperative venture, and I help my neighbours when I can and I freely contribute my thoughts to this blog, while others gallivant around the world holidaying with their family and writing it all off as a business expense while composing the next missive. Well done, a good job, nice work if you can get it!! :)

  16. DB4545


    Thanks for that contribution. It’s interesting to get the insight of people who left our shores some years ago and put their hopes dreams and energy into a different culture. That truly was a wasted resource for this little Country. Maybe a garage conversion would get you up and running on airbnb? Kind Regards

  17. Comments re the COMEX where fractional reserve fraud, bare naked shorting (criminally illegal) of the silver market results in cash settlement in cash rather than delivery.

    Posted on Lemetropolecafe

    Just what the doctor ordered, from our good friend Mexico Mike up in Canada who has checked back in.

    Running stops

    Hi Bill!
    I just want to vent at this point. Look, we know the crooks keep the COMEX opaque for a reason. They can see where the big positions are concentrated as options expiry dates approach, and they know where the stops are set. They also know the limits of physical bullion available to settle for delivery, and that the majority of market participants are not interested in physical settlement. Its almost too easy to rig the market to make sure most of the paying customers leave the casino empty handed, and keep dangling the shiny prizes for the next round of suckers.

    No doubt today there was a huge spike of contracts dumped precisely to take out the bid stack in silver and break down through the 50dma again. No doubt the crooks knew there were a large block of stops set there to shoot for. Having the FOMC minutes on deck just makes it a juicier target.

    Just looking beyond the trading losses for the suckers – something I don’t give a damn about really – there is a systemic problem that has me very pissed off. See, by allowing the shorts off the hook every time, it has encouraged the oversized positions to be maintained that we have today. I believe there is a historic short interest held by clueless funds and small specs, which are typically not the market participants known for betting big and correctly. What happens when the magic of intervention fails to bail out these clowns? What if one day the market breaks away and keeps going?

    I am asking rhetorically because I know the crooks running the COMEX will just declare forced cash settlement and carry on like nothing happened. But that is not good enough. COMEX is supposed to be a primary clearing venue to allow producers and consumers to complete transactions and this is why the spot price is agreed by most players to represent price discovery. When you turn it into a den of thieves and have spec money sloshing around to distort that relationship, the ramifications go far beyond just who makes how much money.

    Given that many mines have already been shuttered, and several promising development projects have been stalled or cancelled due to low metals prices, this is going to matter. If indeed shortages are developing in critical metals supply, the gaming of the market then has real consequences just in terms of the supply chain.

    Sadly, this is not going unnoticed. The rampant manipulation that has tarnished market action in the West has triggered the birth of new markets in the East that will eventually displace the trading. Just like the looting in Ferguson, when the riot is over and the fires go out, those left standing around will realize that business moves elsewhere and they will have nothing but ruins to sift through in the aftermath.

    When the metals markets break for good, its more than just a handful of traders getting settled in cash. It means that many, many players will come to find out the fully paid ‘metal’ they thought they owned does not exist. That opacity that is a feature of the inventory reporting has enabled the same stack of bullion to be represented to multiple owners, none of whom will ever see an ounce of the metal when the dust finally settles. For some of these players, we are talking about hundreds of millions of dollars that will vanish overnight.

    For those that pretend this is a small market that is not very important, this scam is not going to end the way they think it is. Because it has been enabled at the highest levels of regulatory authority and operated by some of the largest financial institutions, the spillover would represent a loss of confidence in the entire system. It is even more infuriating when I stop to think of the added layers of compliance and the harassment from regulatory oversight impairing legitimate transactions, and yet the system is corrupt to the core and will eventually be revealed as such.

    And about those stops… The same guys that know where the stop loss orders are positioned will also know where the big shorts have buy-stops in place. You can bet when we see the rallies in gold and silver severely rebuffed and the market always seems to be capped at specific price levels – there are bigtime buy stops set slightly above those levels. They want to keep the spec shorts comfortable and restrain any impulse to cover positions, as would happen once a normal market was recovering above the 50dma. None of this is happening by accident.

    As we saw with the great ongoing collapse in China, once confidence goes and the big positions start getting liquidated, the game is over. Even a carefully orchestrated scam will break down eventually and the market reaction will swamp any efforts to stop the tide. I do not think the FED has a big enough bazooka this time.

  18. StephenKenny

    But these aren’t really collectives, are they. Uber drivers see full time, they’re attractive because they’re cheaper, so uber is just a low cost taxi service. It’s not cheaper because there’s anything more efficient about it, it’s just because the drivers earn less.
    Airbnb is either renting out a spare room , or an alternative to buy-to-let.
    These aren’t social. The new part of a small town getting together to dig a trench for a pipe to join the town sewerage system, is.

    As far as I can see, the only really interesting thing appearing at the moment is the ‘hyper connected’ generation. AndrewGMooney mentioned it a while ago as the ‘hive mind’.
    These are a new generation that use text, audio & video, to keep in touch on an almost constant basis. Hundreds of short messages a day, within a group. These people think about things as a group, the group provides information, and they develop views.
    This generation don’t watch TV, don’t use Facebook except as a photo sharing service, and don’t read newspapers or listen to the radio.
    They’re children at the moment, but as they grow how they think about things could be very different to previous generations. How will government propaganda fare against such groups? It could be worse, it could be better, but it’ll certainly be different.

  19. DB4545


    If there’s a mechanism to utilize and generate an income stream from an underused asset isn’t that a good thing for individuals and therefore society? The airbnb owner will need tradespeople to maintain and develop the property. Visitors will use taxis and restaurants and pubs etc.

    What could be more social than pulling wealth into an area in a bottom up way and allowing that wealth to circulate in a small community? The old b & b system put food on tables and clothes on kids backs. The hotel brands siphon off the wealth into trust funds for the paris hiltons of the world.I’m aware that we could possibly be creating trust funds for a future paris airbnb but airbnb will face competition soon because that’s the nature of creative destruction.

  20. DB4545


    In relation to being hyper connected and receiving hundred of “messages” a day my concern is that the new generation may just be receiving advertising “noise” dressed up and polished for the new kids on the block.However this generation make TV on youtube the last generation watched passively for the most part.

    But I know I prefer to try to actively contribute and be constantly forced to re-consider or defend my perspective by people on this blog than to passively watch or read old media.


    After the collapse of the Bretton Woods system in 1973, the SDR was redefined as a basket of currencies. Today the SDR basket consists of the euro, Japanese yen, pound sterling, and U.S. dollar. The value of the SDR in terms of the U.S. dollar is determined daily and posted on the IMF’s website.Apr 9, 2015.

    Booking a flight today I printed off the itinerary. In the small print discussing what amount of money could be claimed in the event of delayed flights etc I noted that the unit of currency used was the IMF SDR. Other currencies were listed as a percentile of SDR.

    The one world currency is in effect and is gradually being asserted. Whether this is good or bad depends on ones information and point of view.

    In as much as all countries in the EURO have realized their loss of sovereignty, especially Greece, what does that foretell for the world as a whole in the future of SDR a property of the IMF which itself has diplomatic immunity like the BIS and is a creature of the central banking system.

    I see world bondage ahead.

    What do you see?

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