Thursday, August 7, 2008

TRENDS at 7 August 2008

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Dear Friends:

It is almost the middle of August, 2008, and the economy of the World is in turmoil. The exact causality is not known, despite what the pundits might tell us after the fact, as they usually do. Sadly, they give very conditional and nebulous advice in terms of facing what lies unseen ahead of us, but they enjoy a lively ex post facto (e.g., too late) debate about why things happened...about the why of history.

The three principal benefits of studying history are 1) understanding human eccentricities and propensities; 2) understanding the conditions at present, and how we have arrived at the position which we are in; and, lastly, 3) to predict the future.

Please take a moment and re-read the top line, printed in honest blue. Some crucial trends (and their projected course for the next three years) are cited below for you to think about, investigate and act upon if you are inclined to maximize your potential benefits and to minimize your potential losses.


With Fortune 500 Companies and the Financial Institutions Sector losing credibility, liquidity, market share, and opportunities for upward mobility, unemployment will rise to levels not seen since the Great Depression in the United States, with the World following at a short lag. Many of the best US minds will "outsource themselves" to become expatriates in other countries with greater opportunity. In a wicked twist of social darwinism, the void in the United States will be filled with less-skilled immigrants belatedly chasing the American Dream. The remaining major corporate employers will hire these individuals at lower wages, lower standards and with the expected result of declining productivity and quality of service.

I suspect that US and G-8 corporations will continue to outsource every single function which is not geographically sensitive. At this moment, the US is an exporter of jobs, training, investible dollars and talent. Despite the decline of the US Dollar, expect this trend to continue, and at an accelerating pace.

The principal survival skills in the coming economy will be frugal living, flexibility, mobility and entrepreneurship. Job security will become something that can no longer be vested through seniority - it will have to be made by each individual through finding a niche and a means of profiting by serving it. Education will be far less of a success-determining factor than innovation. Entrepreneurship is powerful, personal and portable. Expertise in certain vertical technological fields will be almost as potent as entrepreneurship. A combination of technical expertise and entrepreneurship, using the World Wide Web as a medium will indeed be an unbeatable combination.

I would suggest that you carefully review author Adam J. Kovitz's Laws Of Relationship Capital , and take a second look at author Jay Goldberg's straightforward, no-nonsense book titled: HOW TO GET, KEEP AND BE WELL-PAID IN A JOB. (Outskirts Press, Denver, CO.) if you are trying to seek a position within the lower ranks of the corporate heirarchy. The book is superb for workforce returnees, as well as beginners. In the economy to come, every one of us who is not blessed with an enormous trust fund will be a beginner.


Through my work with the CHILDREN'S INTERNATIONAL OBESITY FOUNDATION, I was fortunate enough to meet Executive Director Felix Urrutia at the NYC Police Athletic League (PAL). He is, in so many ways, a kindred spirit. While we met based upon PAL's increasing focus on overweight and obesity, especially amoung the urban ethnic population(who are hardest hit by any social or economic crisis), our conversations have taken us further into the realm of PAL's mission, a great part of which involves getting at-risk youth and youth exiting the prison system to learn skills and to become gainfully employed as quickly and efficiently as possible.

Mr. Urrutia introduced me to the growing world of "green-collar" jobs, careers involved in hydroponic gardening, ecology, environment, natural resource sustenance, recycling and numerous other ecologically-grounded pursuits. PAL actually trains these youth and puts them to work, giving them an opportunity to earn a decent, honest living, without being judged or stigmatized as "ghetto kids" or as "ex-convicts". PAL, in its steadfast dedication to its mission, is a visionary; a pioneer in a new job market which is open to everyone. with growing concerns over the environment and climatic change, watch for an increase in attention and opportunity in the 'green-collar" sector. I had, in my stereotying and snobbery, misjudged PAL.

My favorite foundation (CIOF) and PAL are involved in numerous ventures because of their (PAL's) surprisingly aggressive attitude toward stopping violence by increasing education, employment and self-worth among disadvantaged urban youth. Keep an eye on Felix Urrutia and Bobby Ferazi (who works with newly-released former offenders), both of PAL. They have not only found a wonderful niche, but they are opening it for others to enter. I believe it will be a growth industry through all urban cities in the US and worlwideWelcome to the Green-Collar Revolution, and a chance at reducing violence and despair. And to think that I had always thought PAL was just about boxing. I am proud to count these Pioneers for Humanity among my friends.

If I may wax poetic: I found some greens among the blues. I now sport a PAL golf shirt.

Just as the Green-Collar Revolution is taking off, expect an increasing number of careers in meteorology and environmentalism; the first, because climatic change is a "government-sanctioned" reality, and businesses are concerned about its effects; the second, because every G-8 government is regulating with increased ferocity against environmental abuses, and businesses need to be in full compliance with these tougher regulations. Further, and for the sake of the public's perception, each one of these major companies wants to buy penance by coming up with "save the environment" and environmental conservation programs. While this latter conduct may seem somewhat like a Mafia Don giving a tithe to the church, the ultimate result is that it is a stimulus to this vertical area of employment opportunity.

A quick synopsis of what has been said so far: While conventional careers are unraveling, opportunities in green-collar, weather-related and environmental areas are on the rise. If you do not choose to join one of these vertical sectors, you will have to be an entrepreneur.


Every G-8 member nation has become concerned with the need for sources of alternative energy. Technical careers in alternative energy research, development and implementation will be growing over these next few years. Ironically, many of these employment opportunities will be sponsored by the recently engorged petroleum companies. These petro-giants 1) have the money, 2) want to either control or squelch these alternative technologies, and 3) want to show the general public, comprised of victimized, wary consumers, that they are "doing something about the energy crisis." That phrase is becoming a pre-emptive defensive public relations mantra for the Sisters of the Oiligopoly.

Most of the dollars associated with these careers will be allocable to the atomic energy alternative, with an emphasis on thorium-fueled reactors. Most of the residual dollars will be allocable to the development of hybrid, solar and wind technologies. Very little of this allocation will go in the direction of "clean coal" (now there's a paradox) because of the impracticality of dealing with its inherent toxicity and pollution potential.


The United Nations, an institution whose merits and relevance are hotly debated in the United States and other G-8 member nations, will rise to increased prominence as the United States strives to recover credibility, cooperation and friendships lost or injured during the last six years. Many present-day detractors of the UN will find themselves knocking on its doors for assistance in building improved international trade relationships. I am hopeful that the UN can meet this need, and that it will act as an honest arbiter and broker.


As discussed in numerous earlier posts, NGOs (Non-Government Observers, or Non-Government Organizations) and other cause-based organizations will continue to grow in size and influence. The traditional capitalistic model of the for-profit enterprise is under fire, and while profits may indeed fuel progress, the public has become increasingly disapproving of their social, environmental and ethical performance. Capitalism, as any other system, has its negatives and toxic byproducts. An increasingly traumatized public has become disenchanted with "big business". This perception comes and goes - it is part of a cycle roughly synchronized (albeit at a lag) with such variables as 1) stock market and capital market performance, 2) publicized prosecutions of corporate executives, and 3) rising unemployment and news of layoffs.


It was inevitable. As the capital markets become perceived as riskier and less stable in general, the investing public (and the institutions which manage wealth) needs to find a new arena. Low interest rates, erratic stock market performance and a renewed interest in in-the-ground commodities have paved the way for trading exchanges in non-precious metals and minerals. Thorium and the Rare Earth Elements have been receiving a great deal of attention in these emerging micro-exchanges. The effect of this new "marketization," over time, will be an increase in the liquidity of these non-precious metals, and an increased opportunity for all investors to participate in these investments without their having to be owners and operators of mines. It will likely also result in price increases for every one of the traded commodities as trading activity and exchange formalization and acceptance grow.

On August 1st, the following article appeared in Section C-1 of the WALL STREET JOURNAL:

"The New Chemistry of Speculation
Contracts in Metals, Food Show Difficulty in Placing Shackles on Market Bets By IANTHE JEANNE DUGAN -August 1, 2008-

Even as Washington attempts to crack down on speculation in food, fuel and metals, Wall Street is rolling out new ways to bring in money.

In May, Credit Suisse Group and Deutsche Bank AG began offering investments in iron ore, a component of steel. About one billion tons of iron ore is mined a year but isn't traded on a futures exchange. So it has been virtually impossible for speculators to bet on price movements.

Carl Weine

The investment banks were inundated with interest in iron-ore deals, which function like futures contracts. In just two months, investors and hedgers took on more than $500 million of notional exposure -- about 2.7 million metric tons -- making this one of the biggest commodities markets to spring up almost overnight.

The new markets show how hard it will be for legislators to curb commodities speculation.Such trading is spreading to an array of other goods, from jet fuel to chicken, that have been off-limits to investors because they aren't traded on futures markets. They also are offered for commodities already bought and sold on global exchanges, including crude oil, corn and coffee. Through Goldman Sachs Group Inc., clients can invest in palm oil and other biofuel components. Deutsche Bank is trading ruthenium, an obscure metal used in fountain pens. Along with other firms, Deutsche is expanding into rhodium, used in catalytic converters. Deals are being teed up in lithium and "rare earth" metals..." [end of WSJ quote]

As always, thank you for taking time to look into the future with me.

Stay tuned for (cue drumroll...) :






Douglas Castle

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