Unqualified Comics Debate

Western comicers, publishing houses and artists writers and everyone involved can breath a sigh of relief. Japanese comics I'm fairly certain are a passing dominant thing. Sure it may take another 20 years, but I'm fairly certain that the fall will be more spectacular than the rise.

Here's why, I was having lunch with my Japanese friend Yoshi and I forget how it came up but we were talking about comics and he made the comment 'I think Japanese Comics are the best in the world!' A view often expressed by Japanese and Non-Japanese, sometimes in Japanese comics themselves.

To say Japanese comics don't have their merits would be unjust, but are they the best in the world? Pointless, nations don't produce comics, individuals (and creative teams) do. Certainly there are schools and traditions and institutional factors that can flavor vast swathes of comics produced, but by no means does this allow sweeping generalisations.

But I think we can put it like this - If you had to choose between Western or Japanese Comics being erased from history, which one do you choose? I would choose to keep Western and lose Japanese. Sure it would hurt even me to lose the offerings of Tezuka and Inoue from the world, but it just doesn't compare to losing the efforts of Moore, Millar, Lee, Kirby, Bob Kane, the Superman crew, Tintin, Diablo, Punch Magazine and everything else the west has offered.

But I don't think this is the popular view. The way the dollars are talking these days indicates that many wouldn't even blink to lose western comics so long as they have Naruto, Bleach and One Piece.

Demographic #1: Japanese fans of Japanese Comics.

When Japanese people (and to a lesser extent those from a Chinese, Korean or South East Asian background with long exposure to Japanese comic exports) say 'I think Japanese comics are the best in the world!' proudly they are saying the exact same meaningless sentence as I say when I boldly proclaim 'My mama makes the best lasagne in the world!'. Perhaps it has even less meaning. Perhaps a little more.

Firstly, I can probably only find one other person to back my claim. Any Japanese person can probably find a few thousand (western) fanboys to back them up on an internet forum.

But where it has less meaning, is that I've probably tasted other Lasagne's in my life. My experience with Japanese people who are 'experts' on manga or comics, and my eternal frustration having this debate with them is that they often haven't read any western comics.

Case in point, my friend Yoshi didn't even understand how Spiderman can be an ongoing series for 50 years. This would smash any records in Japan, because 'ongoing' series just means an epic storyline, Japanese comics traditionally have the artist and writer be the same person, these people die, retire, get sick of their own series or need to work on something else. Hence 20 years is a long time for a Japanese series to run, and usually the fan base has drastically declined from the heyday (similar to 'Lost' TV series, where the majority that made it the no.1 show in it's first series no longer give a fuck what's up with the island).

Most Japanese have simply heard of western comics, in a very limited capacity. They have heard of Batman, Superman and Spiderman. Their major exposure to western comics are actually the (generally crappy) movie adaptations of these flagship titles which dominate the Japanese box-office.

Put simply, it's worth verifying when a Japanese person claims 'Japanese comics are the best' but generally (a generalisation) it is safe to say this claim is unqualified. They are simply mouthing another hollow piece of 'nihonjinron' the study of 'Japanese-ness' from the same experts that claimed foreign skiis wouldn't work on special Japanese snow, and that Japanese people's digestive systems were so special they couldn't eat American beef. That is self-serving nationalistic (racist) quaks, that are sadly a loud, persuasive and pervasive voice in Japanese media and more tragically - education.

Out of interest when thinking about this, I remembered being criticised by hating on soccer and my friend said 'You sound very parochial when you say that.' and it struck me as a great and valid criticism. Since then I've tried to be more objective in holding aloft AFL and NBA as superior sports to soccer (my athleticism, finesse, speed + brute strength argument, of which NBA and AFL satisfy all four, soccer only satisfies 3, in my opinion)
Anyway, I became curios, do Japanese people have a word for 'parochial' with its negative connotations? Well according to the online translator (not exhaustive by any means) they don't. If this holds true, it could explain a lot about Japan.

Demographic #2: Western Fans of Japanese Comics.

Western fans of Japanese comics are harder to deal with, a larger proportion of them have actually read western comics and thus as far as their own opinion is concerned can actually make a qualified judgement.

Here is my counter-argument: these western fans are either A) young, or B) fanboys/nerds. Keep in mind that I define nerds' central character trait as lacking imagination. Often this is protested 'but nerds are way into fantasy and sci-fi.' I would argue that they are way into fantasy for the same reasons that really stupid people think magnets are 'magic'.

So, when I was a kid, Image was happening, the number one comic in the world was a title called Spawn, and Greg Cappullo was the shit:


Greg has mad skills, and the OTT anatomy and details where totally in. But as I grew older my tastes changed, Greg is now often imitated and his 'look' now seems plain and ordinary. Much more stylistic these days is Tim Sale:


But in the same way that Octupus goes Tough-Tender-Tough when you cook it, I enjoy Greg's art still because it is exactly what one part of comics should be. Fun and explosive. Ultimately though, Spawn probably hasn't stood the test of time largely because the stories (as distinct from the art) never offered much and the moods were too monochromatic.

A kid hates parmesan, an adult relishes it. Show a kid two movies 'The Pianist' and 'Shrek 3' guess which one they will choose as their favorite?

That is my central argument, western fans of Japanese comics tend to be young and/or inexperienced. They haven't read Watchmen, Batman Year One, Maus, Tintin, Asterix, Sin City, Jimmy Corrigan, Palookaville, Bone, Cerebus. They don't know that western comics offer far more than they appear to, they are not as Japanese peeps will expect 'Superman, Batman & Spiderman'.

Whilst Japanese comics are better known for having more than just the 'Superhero' genre (which dominates western comics). The western comic world actually still offers all kinds. Furthermore, even if you just take the Superhero genre, it gets short shrift largely thanks to -

Sturgeon's Law which says '90% of everything is shit'.

90% of Batman stories ever published are pure shite. Not worth reading, except that 10% of the time that story you pick up expecting shit, is actually great. Furthermore 9 out of those ten great comics are just great, only 1% is a true work of art.

Thus in the whole history of Batman (must be over 60 years now), the issues worth reading/regarded as classics represent barely the tip of the iceburg of what was produced. Same goes with Superman, Spiderman etc. Just a tip though, those rare editions have the names 'Moore, Miller, Sale, Loeb...' attached.

But Sturgeon's law is no less applicable to Japanese comics. Infact if anything it is charitable. There is A LOT of Japanese comics to choose from, but the advent of one that is worth reading is rare indeed. Why? Because the Japanese tradition is that the artist writes the stories. The advent of a good artist is rare. The advent of a good writer is rare (perhaps extremely rare as good writers tend to favor writing books, plays and screenplays). The advent of a good writer & artist being the same person is extremely rare.

So rare in fact I can think of only two in Japanese comics - Takehiko Inoue and Osamu Tezuka.

In western comics there's Tim Sale (though he probably wouldn't agree with me) Frank Miller (even then, he's not as good a writer as he is artist). To be honest most of the good writers & artists are in the independant comic scene in the tradition of Will Eisner.

But it doesn't matter in western comics, because a truly great writer like Moore, can work with any great artist and the product can be truly greater than the sum.

Western fans of Japanese comics that would rather keep Japanese comics I feel may not be 'unqualified' as in they have compared the two and thus far found western comics wanting, but I don't think they are right in the long run.

In the long run I expect they will notice that once you've read one manga of each major genre (sports, school, fantasy epic, romance, comedy, horror) you have read them all. Their appetite will probably lead them quickly to the best examples of each genre, and inevitably they will discover Tezuka and worship at his alter like many have before.

Then they will get bored, they will grow up and get tired of the parochial stylisation of manga, everything is a tribute to the genius of Tezuka (with very, very, very few exceptions). They will get sick of the poorly researched suedo science and the tired character archetypes. They will meet somebody at college who puts them (back) onto western comics.

They will notice that western comics evolve, adapt, change and grow. People strive to make their mark as individuals within the industry and to lift the comics to a higher level. They will notice that there is a huge difference between the statements 'Then Frank Miller came along in the 80's and changed everything...' and 'Then Akira Toriyama came along in the 80's and changed everything...' (I would argue that Akira Toriyama creator of Dragon Ball franchise changed almost nothing at all.)

Western Comics evolve.

That's why those in the western comics industry should breath a deep sigh of relief. Premature? maybe, they could still lose it from here. Many would point out that 'here' is where the scoreboard reads 100-36 (western comics down).

It's not the first time though that a Japanese industry has risen up to dominate the world, for a period as long as 2-3 decades. I argue that Japanese comics will fall off the map in the same way that Sony has in consumer electronics.

Why? It comes back to demographic number 1, and why their claims of superiority are so meaningless. Westerners are reading Japanese comics, paying attention and Japanese comics are influencing the writing and artwork of western comics. The reverse is totally or mostly untrue. Western comics have had almost no impact on Japanese comics.

Japanese comics are not learning from the west. They are parochially impervious to the idea that western comics have anything to offer. They haven't even read enough to understand the fundamental differences between Batman and Superman (Bruce Wayne puts on his Batman mask, Superman takes off his Clark Kent Mask as Bill pointed out in Kill Bill part 2. Batman is a traumatised child waging an unwinable war against crime, Superman is a boy scout raised in a rockwellian America.) The stylistic deviations between artists are negligible. There is also a negligable population of writer, artist teams. Many super talented artists (Oh Great comes to mind) waste their talents drawing for the garbage THEY WRITE THEMSELVES. They have sloppy storylines, unbelievable characters and incomprehensible motivations. Even the celebrated sensation 'Death Note' suffers from this.

My Prophecy:

Some day, sooner than most Japanese comic fans expect a westerner will write an 'Original English Language Manga' or 'Global Manga' that will have incorporated innovations from the western comic tradition that Japanese comics sorely lack. Somehow, it will become a hit, putting Japanese comics to shame. Within 2-3 years these hybrids will have engulfed Japanese comics foreign markets, it's the sad old tale of Japanese exports.
Just with iPods and Sony MP3 player (I don't even know what they called theirs) so too will 'Mr McGonagen's Fantabulous Contraption' or whatever wipe Shonen Jump off the map. The Japanese industrial complex won't even be able to figure out what happened, because there is no word for 'parochial' in Japanese and then slowly but surely, the domestic market will falter as kids want to read the cool western take on their home comic.
Within ten years Japanese children will be shocked to learn that 'Weekly Zip' the dominant comic book compendium isn't even Japanese, just as they are currently shocked to learn that 'McDonalds' was founded in Atlanta, USA.

Lastly:

I anticipate a few counterarguments (actually with the history of comments on this blog, I more accurately anticipate no counter-arguments) but when they inevitably come up in conversation here's how I will deal with them.

1. But Japanese comics are more mature, they have more mature readership!

It is true, Japanese comics feature rape, sexual abuse, murder... just generally hardcore violence. Again I say, to a 10 year old this seems mature. If you come across it in an actual manga, lets just say it is often handled indelicately, they are not real explorations of complex and mature issues but merely inserted as shock value. A desperate cry for attention, hence the alarming rate with which female characters shake off rape for the next episode.
They aren't included to set up a storyline where the human condition is explored through the psychological aftermath of such decisions. This is more common in western comics where you are far more likely to see Matt Murdoch AKA Daredevil descend into a depressive funk for several issues grieving than you would if it was written for the Japanese market.
Most westerners having a limited knowledge of modern day Japan would be unfamiliar with the body of literature produced by Japanese and foreign commentators about Japan's 'immaturity complex' the perplexing study of why grown Japanese men scream 'Kawaii' and buy cute stuffed pandas, or why you can regularly see 60 year old men reading comics intended for a children's audiance on trains, in convenience stores... everywhere.
Many Japanese men have a refined dignity in my personal experience, but a distressingly large number don't, clapping and laughing when Doreamon dons a dress tears streaming down their eyes.
I said earlier that western comics mature with their readers. (Black Hole, may be a fine example of this, Harry Potter the literary equivalent). The advent of grown men in Japan reading Shonen Jump is not the same - a large proportion of Japanese males simply don't mature and thus, keep reading comics. There is perhaps too much social stigma against grown men (and women) reading comics in the west, there is perhaps not enough social stigma in Japan.
P.S. The seminal work on Japans arrested infancy is called 'Amae' and is a fascinating insight into much perplexing behaviour in Japan.

2. But you just trudge up the worst examples!

Which wa one of the major reasons that Sturgeon's law was created. Sci-fi kept getting criticised for being shit, it is easy to find collaborating evidence there was/is a vast body of Sci-fi that simply isn't worth reading.
So I'll just reiterate that it cuts both ways, If you couldn't walk into a comic book store and find an example of shitty comic writing and art within the first 3 comics you pick up you would be extremely lucky indeed.
But what are we arguing about? Two industries really. The Japanese comic book industry, dominated by a distributor (Shonen Jump) and characterised by A) Black & White, B) A weekly publication Schedule. C) Multiple genres (robot, sci-fi, horror, super hero, epic, romance, sports...) D) Single creator titles. It's that system versus the western which is Multiple distribution channels (with two dominant players Marvel and DC) publishing titles seperately (the apocryphal 'comic book') on a typically monthly or 'one-off' schedule characterised by A) Mainly Colour, B) On going titles (titles can continue for 50 years with multiple creative teams) C) Dominated by superhero genre. D) Variable creative teams. E) Multiple styles.

There is more stylistic difference between artists like Frank Miller, Greg Cappullo, Jack Kirby, Humberto Ramos, Tim Sale, Will Eisner, Chris Ware and Ben Templesmith than there is between Osamu Tezuka, Akira Toriyama, Eichiro Oda, Watsuki Nobuhiro, Masashi Kishimoto, Oh Great! and Urasawa Naoki.

So I'm basically saying that A) the double coincidence of wants: getting a great writer and a great artist is rare, this is the outcome Japanese comics rely on, Western Comics are generally better at mixing and matching great writers with great artists AND if you take the view that the art serves the story (not the other way round) western comics allow great writers that couldn't create comics in Japan (because of their lack of drawing ability) to write great stories, even if the artwork is average.

B)Variety is the spice of life, and even in the dominant superhero genre (which is by no means all western comics have to offer) there is more variety in artwork and narrative than the entire brief history of Japanese comics. For that reason I would rather have western comics and lose the brilliance of Tezuka (and his numerous imitators).

3. 'Coz Bon Jovi Rules!

By this I mean, if you go pick out a Japanese comic that I would call terrible, and submit it as evidence of Japanese comics superiority I can't argue against that. All I can do is privately judge you.
In Yoshi and my 'debate' where I maintain he is unqualified to opine through lack of exposure to any alternative - I charitably pointed out 20th Century Boys as an example of a good (not great) Japanese comic. He said he didn't like it. He then picked out another comic that had terrible artwork (the traditional 'dash' for a nose, big glassy eyes and well cheap animation values) and submitted it as an example of an excellent comic.
Furthermore the only objective measure is sales, and Japanese comics are clearly outselling western ones, and that when they are overpriced too. But just because Bon Jovi sells a lot of albums doesn't make him a great musician. Or in other words, just because it is popular doesn't make it good. Smoking is popular. Eating hamburgers is popular. I can't argue against popularity, but neither is it strictly speaking a logical argument in and of itself. Lest we forget that the Jonas Brothers probably outsell Classical Music currently, should we throw out classical music and keep the Jonas brothers?

The Ovarian Lottery

In stark contrast to the news headlines, last night I had the distinct priveledge of witnessing my friend and student Zaman become a citizen of Australia.

The obvious highlight was seeing someone I know, respect, love and admire recieve finally the promise of security his heart has been bursting for for so long.

I haven't written much this week So I think I'll play cath up now and do one of those 4 in 1 posts all centered around the 'issue' of population/citizenship etc.

The Malthusian Trap

Economics starts and ends with resources, the very study of economics is to answer the question eternally posed by scarce resources. Specifically before any economic system can operate a bunch of people have to secure a bunch of resources. Everything follows from there.

So call it a community or call it a gang, I'm an anarchist by the way, something I never thought I would be so I prefer to call it a gang. A gang bands together and seizes some natural bounty, that is it lays claim to a patch of earth/space that existed long before them and came to be through no effort of theirs.

Countries in my view are just words, sometimes noted and surrounded by lines on pieces of paper. But on the world itself, they do not exist. They do not exist in the same way dirt and water exists.

Now abridging somewhat, you have a community that has seized some resources and eventually formed agreements with other communities to respect their mutual territories and form some kind of super-community called a country, a nation.

But the important points are these: A) the resources at some point were seized. B) resources are limited.

Now classical Economists depending on your view are either undervalued or overvalued. Adam Smith did a good thought experiment that works 70% of the time and John Stuart Mill's concept of utility has some nice features. But Malthus, he's a cunt that should be better known as one.

He basically said that a country could not raise its standard of living faster than its population growth, and that if a population grows too fast it may be forced to return to a subsistence standard of living. (ie. scratching in the dirt all day just to obtain enough food to live for another day, that is spent much the same as yesterday).

Most people unwittingly agree with Malthus, HOWEVER Malthus theories have been CONSISTENTLY DISPROVEN more than any other popular economic theory in history, by history.

Worst case scenario - overpopulation somehow exceeds actual food production resulting in mass starvation/famines. Amartya Sen points out that famine's historically are not the result of a shortage of food per se, but of access to food - food pricing issues.

Whether it was the great Potato Famine or the Ethiopian crisis of the late 80's early 90's, you may be surprised to find that many countries undergoing a famine are NET EXPORTERS of food. The fact that livestock and grain were being shipped to Britain by the Irish during the Potato Famine remains a sore point between the two national identities.

Put simply, people starve because they cant buy food, not because there isn't enough. This should intuitively make sense to you, if you grew up in the 90's you would have been made accutely aware that the dinner you couldn't finish would save the life of some malnourished african kid by your parents always eager to instill a deep sense of guilt in their children for the crime of being alive.

Furthermore one has only to consider your gym membership also, what kind of society do we live in where we consume so many calories that we have a whole industry dedicated to burning the excess off?

Yet dickcunt organisations like 'Sustainable Population Australia' act as if we are blindly stumbling into some situation where the population will lead to a breakdown in society. The easiest thing to point to is water.

Yes, resources are limited. Except as a thought exercise one should just walk outside at night and gaze up into the universe and consider how much economic activity is required to consume ALL the resources OUT THERE in space.

There is no catastrophe being faced by an increase in Australia's population. The average Australian utilises 7.2 hectares of resources in their life (their eco-foot print) the average human being's foot-print is 1.4. We have plenty of footprint to share. Don't be greedy.

But the conclusion to this section is this: There isn't much evidence to suggest that the supposed adverse effects of population increase are real.

The Emmigration Question

Ultimately what yanks my crank when Abbot presses population(racist) issues and Rudd cowardly capitulates and Sustainable Population Australia lecture people on 'closing the boarders' is that the priveledge of citizenship is so one-eyed.
That is they are perfectly capable of recognising citizenship as a priveledge (not a right) when it comes to bestowing it on people from across the seas with funny coloured skins.
But of course it is a right when applied to gang members. Not a priveledge but something that is literally taken for granted. The population problem isn't a problem for 'our' children, nor is it a problem for 'us' who were here first.
This is racism pure and simple, gang behaviour. Dividing the world into insiders and outsiders.
So most people think it sensible to deny citizenship to illiterate unskilled migrants who aren't fleeing any real or percieved danger.

Why not avoid double standards and deny/retract residency from Australian born people who fail to attain literacy or any tradable skills? They have access to public education whereas many migrants never did (hence the desire to migrate here and secure a better future for their children and grandchildren).

I'm not suggesting this be the case, but I just point out. Anyone who argues there are too many people somewhere (even at a party) are never including their own presence. They are always invaded, and have some god given right to stay that is unquestionable.

Fucking kill yourselves you priveledged spoilt cunts. Ultimately you are a kid with a whole chocolate cake complaining about other kids coming to the party.

Rights and Wrong

Why do we have rights? Well surprisingly John Stuart Mill the big utilitarian, in his book on Liberty talks about something called the 'Tyranny of the Majority' that is something that is popular, but is also wrong.

For example, Timmy has $50 and 9 other people have nothing, they can all vote and the democratic consensus (9 votes yes, 1 vote no) would be that Timmy can be deprived of his property and his wealth redistributed.

Many would argue that this indeed is the population debate, that new Australian's will deprive existing Australian's (or whoever) of their property. THIS IS NOT the population debate. Those new members of the populace are simply given the right to operate in the market system. At most they can draw on the social safety net, but unskilled migrants (namely refugees) constitute such a minority of immigration anywhere that the consequences are a literal drop in the bucket.

No, Timmy being democratically deprived of property is tyranny of the majority. Put simply you can't vote on what is right and wrong. Now what IS right and wrong is a subject of great debate, for me the best explanation can be found in 'the selfish gene' or evolution to describe right and wrong behaviour. But rights exist to protect you from popular misconceptions.

For the population debate there is a particular set of rights of concern: Human Rights.

Oweing to the impotence of the UN, that is an inability for the UN to enforce it's Universal Human Rights they haven't as such had to be censured or corrupted or ammended. Thus precisely because nobody listens to the UN, they have immense value in what they say because nobody bothers to distort their message nor heed their admonitions. They are simply ignored.

But if the UN criticises you, YOU ARE THE BAD GUY. (admittedly at the local/program/administrative level the UN has its own track record of corruption). The UN has criticised Australia for it's refugee policies in the past. Specifically Temporary Protection Visa's (which achieved nothing but aggrevated misery for the uncertain holders) and mandatory detention and mandatory detention of children.

They are violations of UN human rights and these rights exist to protect human beings everywhere. Not Australian citizens vs. everyone else, but everyone. You, me, everyone.

What goes around comes around

Right now we are signing landmark deals with China and everyone is patting themselves on the back.

Imagine in ten years time that China decides that it would be simply cheaper to invade Australia and seize our resources than to continue trading with us.

This would not be unusual, after all a democratic freedom loving state like the US or Britain have not shied away in the past from taking just this course of action.

Suddenly you have sold the shirt off your back to an indonesian with a boat hoping to turn up one day on the shores of Japan for a better life. Then see how much you like 'sustainable population' arguments, how much you applaud 'mandatory detention' and 'temporary protection visas' while the Japanese beauracracy takes it's sweet time deciding whether you will be processed or shipped back to China-Occupied Australia.

I don't mean to make villain out of China. It could just as easily (or with difficulty) be America or hey, a suped up version of the Netherlands sick of our foot draggin over Carbon ETS or Carbon Tax or Carbon rationing.

All Resources are seized...

The most poigniant speaker was the representative of the first Australians. The Aboriginal Elder of the Wurundjeri people's who looked quite young and spoke about how great it was to welcome them to Australia, particularly those fleeing danger and tyranny to come to a place like Australia.

To see somebody who wasn't legally recognised as a human being until a few decades ago, whose oldest living culture was decimated by European Invasion welcoming people to Australia and how great it was to see the different cultures represented amongst the kids on the streets of Victoria is simply powerful.

If a person whose life and standing in society has been greatly eroded by an actual and long history of (European) population growth can welcome new Australians, so should everybody.

Conclusion

We may live unsustainable lives, but picking some 'sustainable' number for our population is folly. Largely because it ignores the basic fact of wealth distribution. Depriving the wealthiest 1% of Australians of their property and shipping them off to places unknown would free up far more resources than picking on the 'tired, hungry and poor'.
Migration enriches communities it does not impoverish them, unless our systems are designed to isolate, impoverish and alienate new migrants.

A simple start to ending the racist debate of 'population' which is really 'our gang feels our turf is being threatened' couched in psuedo-scientific language, would be to make attendance at citizenship ceremonies mandatory (in the same way voting is). If people could see for themselves how truly joyous and special these occassions are, and how filled with Good-Will a room can be, this debate would not exist.

But why stop there? I'd put an end to the Ovarian lottery, and simply make it mandatory for people to Earn their Australian citizenship. That is attend the ceremony and make the pledge just as migrants do when they apply for citizenship. Even an anarchist like me would do it, just out of practical necessity. But I'd appreciate the distinction that I was not born 'Australian' but an individual, and I may even appreciate the institution, the words, the lines that make a country more.

Cute Hat B*#ch

I was trying to explain why I hated one of the master-chef contestants, a girl that to me is getting an agonizingly perplexing amount of love from the camera. Not the shaky 'Season 2's Julia' lady, but the other one the cameras are loving up.
Anyway, for some reason this analogy sprang to mind as if it is informative in some way. I find it sufficiently amusing and strangely profound:

'okay she's the kind of girl that on a night out with the girls rocks up and all her (female friends) comment "oh cute hat".'

I hat the cute hat girl, and I kind of hate her friends for reinforcing the lifestyle. Sorry if this is you. I don't quite understand why, but hate I do.

DW Ch1: Two Thoughts

[Ed: Confused, read this post.]

The first time Gus thought of her was shortly after brushing his teeth. While brushing his teeth he went to the exceptional effort of patting himself on the back just for remembering to brush his teeth. Such were his irregular hours. Such were the demands of his lifestyle.
And so the thought started forming, from the bathroom to the living room to his bedroom.
Tonight was a special night, Gus was far enough ahead on his schedule to actually go to sleep at a decent hour. (Said schedule wreaked havoc on his teeth brushing routine).
But going to sleep was not as easy as it sounded. He had a minefield of clothing (both dirty and clean arranged in a pattern only he could discern) plates and bowls from malnutritious meals, books lying open for reference and inspiration and yet more books often placed just to prop the reference books up so he could see them from his desk in the corner.
He resolved to leap, from doorway to bed. 1.5 meters from a standing start.
It's more difficult than it sounds and this was proven when Gus landed in bed slamming his left shinbone into the frame. He had the presence of mind to roll forward with his momentum. Push some books and clothing out of the way and lie down willing the burning pane of bone-on-wood contact to dissappear.
The revelation struck him 'I can't look after myself' as he lay there.
That's when he thought of her the first time. Not someone who could cook and clean for him so much, as someone he cared enough about to actually cook and clean for, for fucks sake, he thought, that somebody certainly isn't me.
So Gus just lay there, thinking of her as he went to sleep in his OH&S non-compliant bedroom.

It was infuriating to think of her though, because he didn't know what she looked like or any other details of who she was. All he knew was that he would recognize her when he saw her. But he couldn't see her now, not in his minds eye.

The second time he thought of her was some months later, he had quashed down his need for her by mustering the will to actually clean his room.
On this particular day though he had no deadlines looming to occupy his thoughts. What occupied his thoughts was the woman he was with.
Periodically Gus' friends would succeed in convincing him his problems could be solved simply by getting laid. Most of the time it smacked of superstition, but occasionally his outlook would become so bleak their theory would start looking plausible.
This lady though he had a sneaking suspicion was the sort that just made his outlook worse.
Occasionaly he could shelve his ineptitude and overcome the sever handicap he was endowed with to actually convince a girl at a party somewhere to hook up with him. Being an artist that managed to eke out a living on pretentious magazine cover commissions and t-shirt sales was sufficient he guessed for these women to entertain the fantasy by doing him they were doing something romantic.
As he looked at her his consciousness kept surfacing. She was attractive in an unattractive way, beauty stretched over an abyss of personality that it seemed most guys could shrug off for a while. Or maybe they couldn't, hence her single status now? To Gus she was the sort of girl you made love to because you wanted to punish yourself.
It could produce great sex, in the same way KFC produces great taste. He could lose himself in her and awake hours later with the self loathing.
Tonight though as he contemplated going down on her, he thought of her. Not her but her, the someone he didn't know but would recognise if he saw her.
The someone he actually cared about, and he thought I want to use my lips for kissing someone I care about one day. I want to put my lips on hers..
Gus wasn't normally so prudish as to believe there were legitimate hygenic reasons not to go down, or something as naive and childish as 'true love waits' yet the thought occurred and it stuck with him. So he didn't, lost interest quickly and wished this strranger had the inclination to leave rather than stay the night.
She didn't, she lay her head on his chest. Was she presumptuous or he just cold? Gus didn't spend much time thinking about it, he spent the moments before sleep thinking of her.

He wanted to meet her.

Next Week...

I'm making the commitment now that next week I am going to do something different with my blog.

I'm going to write some fiction.

Some terrible, bad fiction. I always struggle with fiction, I never seem to be able to find a characters voice namely. All the characters seem wooden to me, and I just can't get scenes to flow and well I'm terrible.

I find I can work at the conceptual level, I have great ideas (I think...) I can just rarely execute, which is why I've traditionally gravitated to writing in the comic and film medium. No need to describe shit in a non-clinical non-dull way.

Anyhoo, I'm not going to get better by A) not writing and B) not showing people and not getting feedback.

So next week I will start writing a throwaway romance called 'Dickwad' (I was going to just call it date-night, but then that movie came out). Then each 'chapter-thing' will be followed by some feedback questions. If I get one comment (answering a feedback question) I will write another chapter and then just see where it goes. No feedback, no point, may as well just write it in my word.doc at home and leave it on a harddrive as practice to be canabilised.

Alright, let's get this party started...

Does Anybody Else Think Like This?

So my course had a dealing room simulator component and I just completed my first one. It was in the Money Markets trading bills and overnight cash.

I was in Group 4 (of 5) and necessarily certain groups were at different times (due to the limited capacity of the trading room) and some times were more attractive than others.

Group 4 was at an unattractive time (9.30am Friday) meaning that the students that signed up for it did so for lack of a better option. Namely the class was characterised by those students who are late for lectures, have low attendence and generally struggle.

But the cunning-animal tohm stirred in my brain, and expanded my strategic scope. That is not focusing on the in-game-world of the money simulator, but considering the class itself. It was a fine example of when it pays 'hypothetically' to be a brutish predator and not an economic rationalist.

Economists discount debt generally from their considerations of the macroeconomy because they assume people are 'rational utility maximisers' thus if the are in a debt transaction (borrowing or lending funds) they have weighed up the risks and returns and make the decision that maximises their returns.

Now I looked around and came to the conclusion that in this market 'incompetence prevails'. I mean it was only natural, this was Group 4 the stragglers group, it had a disproportionate representation of students who would fail this subject.

All I had to do was find them and take advantage. Of course, there are groups within the group, and a group could operate much like mine, that is if you have groups of 3 all you need do is have one competent member with a veto over all decisions.

Thanks to the 'miracle of groupism' though, incompetence tends to band together. Even in group 4 a group characterised by latecomers and absentees, their were people who were latecomers to our group.

This was one way that incompetence ended up clustered.

Add to that a basic confusion in trading, when you buy cash you are borrowing it purchased with interest. But when you buy bills you are depositing (investing cash) and paid with interest.

This creates a simple, but confusing switcheroo you either:

Buy Cash low and Sell Cash high
Sell Bills low and Buy Bills high (this is the correct pricing structure for bills and cash)

Buy Cash low and Sell Cash high
Buy Bills low and Sell Bills high (half right half wrong, a simple mental lapse: regular incompetence)

Sell Cash low and Buy Cash high
Sell Bills low and Buy Bills high (opposite of above, a simple mental lapse: regular incompetence)

Sell Cash low and Buy Cash high
Buy Bills low and Sell Bills high (completely wrong pricing structure, a recipe for losing money in every transaction you make, gross incompetence)

And for our team it was just a matter of reinforcing the rates we were looking for then looking around for a sucker. We had the correct pricing structure (bar one lapse made admittedly in the heat of a moment by me). So we simply borrowed at say 4.3% and lent at 4.8%.

We also removed the ambiguity, instead of asking for 'Bid' and 'Ask' rates we told people we were 'Buying' or 'Selling' and asked for their rate. Our decision rules to buy sell or wish them a pleasent day were relatively simple. For example we could just say 'Okay we want to Buy Bills at 4.8% on the shortest term possible. If they won't give us that or higher forget it.' and off we go.

Now as a bank we were supposed to be Price Makers, which meant we theoretically should sit around waiting for business to call us.

I knew though we shouldn't wait and let business set the pace. The Chauncey Billups in me bubbled up and we called around businesses to either raise funds, invest funds or let them know our rates.

This kept our competing business entities on their toes and with little time to consult with eachother (and thus mitigate incompetence).

As such we found our incompetent traders and took advantage of them. They would buy cash from us at 4.9% interest when the market rate was 4.2% thinking we were paying them instead of them paying us. We would sell bills at 4.1% thinking they had bought a bargain when in fact they had given us free money we could reinvest with them.

Few knew their credit ratings nor thought to ask us. There were even groups that made clerical errors (ie. made a transaction error that was to our detriment) and when instructed to reverse the transaction instead of just keying the inverse transaction as they should, called us up and asked to make the inverse transaction (which would inevitably be to our advantage).

Thus we made a hypothetical killing by exploiting and taking advantage of incompetence in the same way sociopaths exploit isolating corporate cultures.

It is however unattractive behaviour. I would never act like this in a real situation (so I claim, though I will freely admit I would be tempted, it is after all free money). Why?

Well I work in a call center. Thus I can observe the phenomena of 'social moods' for lack of a technical or correct name for it.

That is some days everyone you talk to is in a good mood and happy to help you out. You go call to call and so fourth. Other days everyone is shitty, tired and angry even though between one call and the next may be 100's of kilometers.

It all suggests that our moods are interconnected. In the example of the call center the most likely connection point is actually me, as the caller. My mood will come out in my voice in some way. Even though I try to be positive and calm all the time on different days it requires different energy. And this will come through as either genuine or deceptive. I must assume I get treated accordingly.

But then there's other things that affect people's moods like it being tuesday, worst day of the working week. Or it being pay day. Or it being just after a long weekend. Or the news that day was bad. Or today tonight ran a story on telemarketing scams.

With moods though there's a bunch of theories and you can observe them. Generally if you take two different people in two different emotional states the most consistent state wins. This is why I generally exert an effort to stay calm all the time.

You take a person who is pissed off and just flared up and you get them to talk to me who is calm, that person will calm down. Alternatively take somebody who is very angry all the time and constantly in a bad mood, they will eventually wear me down until my resistance is gone and I will be in a bad mood.

Our moods in short are either infecting other people (infectuously cheerful) or being infected by others (rush hour traffic) in every interpersonal transaction we have.

Our networks (globally) have never been more interconnected. Our welfare depends on the aggregate happiness out there (which will via consistent infection, decimate the aggregate misery/cunti-tude/anger out there) and hapiness is consistent with optimism, and optimism is consistent with business confidence and business confidence is consistent with greater risk tolerence, and greater risk tolerance is consistent with profitability.

So in a real context I like to think I would never take advantage of some incompetent employee who slips up and offers to pay me their uncompetitive rip off rate on a very large transaction rather than charge me their uncompetitive rip off rate on a very large transaction. Because that employee is going to get fired, his manager is going to be really pissed off. The customers of that institution will get pissed off and bingo - thousands of pissed off people have just been created.

An economist might poo-poo me and point out that my customers would be very happy. But, fuck my customers, a psychologist would readily point out that people would rather avoid pain than seek pleasure. The outcomes would not cancel eachother out. (my customers will probably be more concentrated too... more on that later) the net effect of my exploitation would be negative.

I mean we would have allowed an irrational transaction to go through which means unearned income which by symmetry means an unearned or deadweight loss to people. My customers would be happy if I made a good transaction in competent circumstances, they wouldn't (hopefully) notice that I had foregone an opportunity to rip an unearned windfall out of the market for them redistributing wealth into their hands at the hands of innocent customers with incompetent representation.

Sadly though, law actually encourages sociopathic behaviour in that it is illegal for me to knowingly not maximise shareholder returns. (it is okay by contrast to minimise shareholder returns by grossly overestimating profits and underestimating risks using standard practice).

I can act like a sociopath in a simulator, because we are dealing with hypothetical money with no real customers to suffer or gain (unless RMIT is playing some version of ender's gae, but why?) furthermore, the assesment isn't based on our performance but our understanding. If the incompetents I ripped off care to look at their transaction report to see where they lost all their money and understood how, they could still by rights score full marks on their assignment. People get caught up in games and can forget these things. For me it was good to let my inner animal out for a stroll in the park, but outside of this I keep it in captivity.

So when I ask 'Does anybody else think like this?' the question is two-fold.

1. Is anybody as ruthless as I can be?

Which is just a question of pure curiosity. More importantly:

2. Can other people clearly distinguish between a game with no real stake-holders and reality with real winners and losers?

Businesses after all create wealth, by value-adding or gaining in efficiency, their gain is not strictly speaking meant to be to the detriment of others. (hence the introduction of triple-bottom-line practices and what-not). Profit is supposed to be profit in the net sense, not merely a transfer of wealth.

In times of turmoil wealth flows from weak hands to strong hands, and I do agree that resources should gravitate to those who can use it most constructively/competently. But this can happen smoothly in a marketplace, there's no need for some confident alpha-male bears to bludgeon to death all the little cubs and take their mammas into their harem.

Choice & Responsibility AKA Sue Your Parents.

This post is long, but I've broken it up. I promise I won't write any more about property and what not after this(for at least a month).

A Book on Japan In Japan

In Japan there are a lot of books about Japan, or so I am told in the books in Japan that are in English about the Japanese and the Books they have written.

Anyway, in one of them 'Shutting Out the Sun' an exploration of the Japanese Shut-in generation Hikikimori and Parasite Singles and so fourth, they look at a wonderful man with no qualifications that set up a rehabilitation program for Japan's shut-ins and suicidally depressed youth.

He operated on a simple philosophy, so simple and profound it sticks with me and informs most of my character evaluations these days:

'Choice and Responsibility'

To put it simply, if you make a choice you have to take responsibility.

I don't want to digress into Japan, I'd rather explain from my 'But I Can't Make Them Think...' post the last paragraph where I said I'd get upset at my parents if the housing market crashed (even though I personally have no exposure). Because I feel the choice people are making is distorted, by trusted advice from unqualified sources making them believe their choices are either non-existent or more limited than they actually are. And when you believe garbage because you were taught garbage, it's hard to take responsibility.

A Suspicious Reviewer

I have/had(?!) a friend, for fun let's call him Othello. For more fun, let's say hypothetically he was a devout Zoro-Astrian. Everybody loves(d!?)Othello, he was interesting, charming and engaiging.
I periodically found Othello annoying though in social contexts, one-on-one we could talk about Basketball whatever, in a social context though conversation always turned to the subject of Zoroastroism. And I just got sick of fucking hearing about it.

What was suspicious though was that Othello claimed at some point in his teens he had investigated all the various faiths on offer... presumably Jainism, Bahai, Buddhism, Sikhism, Islam, Judaism, Christianity, Catholicism, perhaps even the mythologies. Presumably he even researched and reviewed athiesm.

Now here we have an impenatrably objective inquiry into 'what I should believe' like Ghandi and various others have done in the past. Fortuitously (and remember objectively) Othello's inquiry led him to conclude that the very religion he had been raised to believe in was in his view the objectively superior one.

This meant little adjustment and so fourth.

Why do I tell this story, and what the fuck does it have to do with sueing your parents? Well I'm a bitter synical twisted man (as anyone who knows me will attest) and I reject that any child raised is capable of objectively assessing and comparing the beliefs and values their parents have foistered (quite innocently) upon them.

What Dawkins' calls the misnomer or error we make in describing a 'muslim child' or 'christian child' when they should respectively be called 'a child of muslim parents' and a 'child of christian parents' to appropriately point out we are not born with an organised religion but educated/conditioned/indoctrinated by our parents often willingly because they were quite often recepients of the same treatment.

Now, enough judging others (for that is what I did, I don't know if I can describe what Othello does or believes from an objective viewpoint) and onto my experience.

For me, in primary school kids either did RE or didn't. Those that didn't faced ridicule, some kid Mathew I think was excused from RE on his parents objections, and when we pressed him to tell us what he got for christmas he told us 'a banana' which retrospectively is quite a witty thing to tell children.

RE was of course, just Christianity though, I hope this kind of practice is illegal in public schools. Some volunteer vacuous bitch would come in and sing songs like 'father abraham had many sons' and what not.

I was impressionable, I had been sent to school to learn, and at school they were teaching me Christian religion. So I believed in this God. (My brother apparantly in his RE sessions got quite distressed and screamed out 'but there isn't any god!') And I remember telling my parents that I believed in God. They just were like 'mmhmm that's nice' adopting a 'wait and hold' policy with me until I guess I chose not to believe in him again some (in hindsight) relatively short time later.

BUT crucially to me, the choice was never between Jainism, Bahai, Buddhism, Sikhism, Islam, Judaism, Christianity, Catholicism and Athiesm. My choice was a dichotomy (a false dichotomy) between Sweet Baby Jesus and Sweet Fuck All. Contrary to Pascal's expectations I chose Sweet Fuck All, even when I thought the choice was as simple as he presented.

By the time I learned that there were other viable things to believe in it was already too late. As somebody (?) said 'once the mind has become enlightened it cannot be darkened again' so for me, once you appreciate the simple elegance of a universe without god, it becomes very very very very very very very very hard to explain how a god(s) could actually exist given that our senses seem to tell us daily they don't.

What indeed is the point of all this? Children trust their parents. As simple as that. Gravity is mysterious, no physicist (at time of writing) really knows what it is or how/why it works. At the very least no physicist has been able to explain it to me yet. And yet, it is there, simple mindless and reinforcing its presence every day.

God is as Woody Allen said 'a remarkable under achiever' thus, his presence is not self reinforcing, as evidence I submit to you the vast amounts of energy and discipline exerted in propegatting the faith, versus the numerous opportunities daily that people's faith is shaken - seeing the rich and evil go unpunished, or downs syndrome, childhood leukemia, juvenile diabetes and what not diminishing the quality of life of innocent children, or earthquakes and tsunamis killing vast swathes of people for no apparant reason at all.

To an atheist this is because they happen for no particular reason at all, they are just biproducts of the evolution of the universe with no agent behind them. For a believer these challange the judgement of an omnipotent being.

Yet these challanges are resisted, rejected, the evidence cast out the apologies remain some even with the semblance of sophistication. Why? Because children trust their parents.

Another Book

Children trust their parents. hmm...

At very few occassions in my life have I found just the book I need at just the time I needed to read it. But this is one of those occassions - it's called 'Animal Spirits'.

You see as a student of Economics & Finance I have one huge advantage over my peers. I previously studied marketing and thus it is simply too much of a stretch for me to trust my lecturers authority figures though they are and accept that 'people are rational utility maximisers' which means I reject by and large Economic theory in terms of setting Macroeconomic policy - eg. fiscal or monetary policy decisions, interest rates etc.

But I don't reject generally Economic theory. I believe it does describe accurately how rational behaviour can win. So for an individual investor, it is very useful to use reason when thinking about prices, investments, transactions, earnings, time value of money etc. It is far better to be reasonable and rational than to be emotional - that is indeed how you maximise profits.

Anyway, the Book! the book is called 'Animal Spirits' and it explains succinctly why the first people I will be angry at when the housing market collapses (unfairly) will be my parents. And it is why I say sue your parents (for which I will have to elaborate) here I lift a passage from 'Animal Spirits' by Robert Schiller (and for the record yes, he predicted the GFC in 2006) and George. A Akerlof. (to his detriment perhaps a Nobel Winner).

But if we look up 'confidence' in the dictionary, we see that it is more than a prediction. The dictionary says it means 'trust' or 'full belief'. The word comes from the latin 'fido', meaning 'I trust.' The confidence crisis we are in at the time of this writing is also called a credit crisis. 'credit' derives from the Latin 'credo' meaning 'I believe'.
... Economists have only partly captured what is meant by trust or belief. Their view suggests that confidence is rational... But their is more to the notion of confidence. The very meaning of trust is that we go beyond the rational. Indeed the truly trusting person often discards or discounts certain information. She may not even process the information that is available to her rationally; even if she has processed it rationally, she still may not act on it rationally. She acts according to what she trusts to be true.

Don't ask me why the feminine pronoun. The point being, that Children trust their parents. Even when the children are adults (supposedly).

Parents don't necessarily realise the full implications of the advice they give, nor why they give it.

Just as most parents are not Moral-Philosophers, Biologists and Physicists and thus are not qualified to explain to the children how the world came about, why we are here and how we should act - yet do so anyway (as Darwin and Dawkins have explained, our Morals will be more or less universaly ingrained). So too do parents not realise the implications of the unqualified financial advice they offer are.

I have spent (and still do) the last 4 or so years qualifying statements I've made by offering the information that I am not qualified to give financial advice. Why? I am worried that people will trust me, believe what I say and take my advice - because it is my advice. Why why?

Because of a thing called 'Negligent misstatement' that I learned about either in Commercial Law or Introduction to Financial Planning. Which says you can be found liable for financial damages if the party you offered advice to took you seriously. Even if you are not aware that you are being taken seriously.

Parents don't realise (yet must) how seriously their kids take their advice. Being rich and having money and what not does not a meaningful life make, but money plays a role and thus it is natural that kids will seek the advice of their forebears because they A) know and trust them. and B) seek to benefit from their experiences.

But when parents look to their experiences and how buying a house in the 70s worked out well for them, they don't realise that their children can't go and buy a house in the 70's and that the situations are not the same.

They don't ask rudimentary questions like 'if house prices always go up, why the fuck would anybody sell one?' or anything like that.

Kids do take their parents seriously. So parents should realise that their incessant urging and nagging for their kids first to 'save up' and then 'establish your self in the housing market' is serious financial advice and they are liable for the losses. That's why I say to my peers, IF house prices tumble by 20-40% (or mayhaps even more) don't throw yourselves out the window. Sue your parents for their 'negligent misstatement' they offered you advice on the most significant investment of your life and you took it seriously and it turns out they hadn't checked their facts.

Two Choices

A caveat though, I don't want to call all my peers blind mules that just follow their parents advice (many do, and I presume the proportion increases inversely with affluence, for various reasons). Thus it is entirely possible that you have gone and independently researched the property market and investing and even understand that you can invest/speculate on your own home (ie. owner occupied).
Unfortunately, Border's shelves are full of books that I can't believe are legal that will supply selected 'evidence' to clarify 'myths' like property should be cash flow positive, property is 'crash proof' and so what. These books have carefully worded carefully secreted 'cover-your-arse' language though so a discerning reader should put them down discouraged.
Alas, this is a confirmation bias, where you start with what you believe then go out and seek evidence to confirm it. Like my friend Othello and his search for the true faith which resolved nobly and with minimum fuss.

Choice (and Responsibility) #1:

What I (/all I can) do is offer an alternative narrative, point to ABS statistics that suggest that rather than a housing shortage over building is an issue, other actually qualified financial advisors like Scott Pape who are wary of investing in property (particularly for young people) and Peter Schiff, Robert Schiller and also California that talked the exact same talk that Australia does right up until its property market crashed and crashed spectacularly.
This provides people with an alternative narrative that they can then make an informed choice - they no longer just trust their parents (or mortgage brokers*, or real estate agents, or newspaper commentators). I offer them merely an alternative choice of narrative they can choose to research and weigh up on their own or reject, but from there they must take responsibility for the decision they make. That's all they can do. And whilst if a housing crash does bankrupt several of my peers, I don't intend to laugh at them (though I might, I imagine they will be crazy times should they occur) but I will feel vindicated, and would be angry if they met my vindication with anger.

Choice (and Responsibility) #2:

This is just to illustrate when choice and responsibility are in disequilibrium. Traditionally people love to take responsibility when times are good, (an advisor talking about his ability to accurately pick hot stocks) and shun it when times are bad (an advisor referring to the market and the lack of confidence 'out there').
Your parents are no different. I am of course talking about the aggregate average angst ridden baby-boomer.
The government introduced superannuation to try to mitigate the huge tax burden suffered by the workforce once Baby-boomers hit retirement age. (health care and pension expenditure will skyrocket). Why? the Baby-boomers are numerous, they outnumber their own progeny (Gen Y) and the other generations (Gen X and iGen(?)).
But to work superannuation has to be invested in productive (wealth creating) activities, like companies that do stuff and sell stuff.
Now disagree with me till you are blue in the face, but investing in property is not productive and it never has been. Property earns one form of income - rent, and to pay rent you need to accomodate somebody who earns money.
If the Baby boomers, on mass invest in 'investment property' then their retirement income streams come from rental income, (because you don't sell houses that regularly).
Now NOBODY seems to have pointed out for this scheme to work (en masse) their would need to be more renters than landlords, (or more workers than retirees) otherwise it's just a more indirect tax on the workforce. The workers pay rent to landlords who contribute nothing (just own shit). Rent that is supposed to sustain their lifestyle.
This 'property apartheid' as Ryan Heith has called it leads to rent hikes, making renting less feesable to Gen Y, who is living at home longer than before.
It's like a massive 'my kids will support me swap' and as grossly ineffecient as that actually sounds. Instead of just asking your own kids for money to support you in old age (because the pension they pay taxes for is insufficient) you simply buy the house of your neighbours kid and he buys your kids house and you charge each-others kids rent.
That is literally (if not consciously) the scheme that is doomed to fail (particularly now Rudd has relaxed foreign ownership laws and tightened immigration, thus further increasing the number of landlords whilst reducing the number of potential working rent paying tennants) and thanks to super-choices is actually quite literally a choice willingly made by your parents.
But do they take responsibility for it? No. Just look at Foxtel's current ad 'We thought you moved out in your 30s son.' kids are seen as moronic selfish parasites when in fact the reverse is quite true.

Alas, one last book

Ayn Rand, father of Assholism, in her book 'The Fountainhead' contains a particularly distressing/moving scene. Peater Keating's life was shaped by his mother Mrs. Keating who wisely steered him away from his passion of painting and reapplied his inclination to draw and create to the much more vocational pursuit of Architecture.
Always looking out for her son's best interests she manuevered him into Guy Frankon's company and overseas his assent to the top of the architectural world.
But by the end of the book Keating is a wreck, a shell of his former self destroyed in the long-run by his mother's very designs that were intended to protect him from failure.
When confronted with this brutal reality Mrs. Keating herself becomes a wreck and in short, every body loses.

For me its a poigniant (if indelicate) illustration of the perpetually understated risks of being risk averse. The addage is 'the greatest risk is taking no risk at all' and it bears out. But people don't see this addage when parents bring out 'folk wisdom' like 'you're safe with bricks and mortar' and 'buy land they ain't making any more of it' and 'house prices always go up' and 'you're best off with property in the long run'.
Nor can I say without risk, that house prices won't continue to go up. All I can do is to suggest that it may be (devestatingly) riskier than it appears. You know what, I can't actually be bothered doing the research to even estimate the odds. I'm not concerned with the odds though, or the when, just the consequences.
All I can do is suggest that you spend some time being concerned as I am about consequences before you make the choice. And you better be fucking willing to take responsibility, because we are running out of taxpayers to bail you out.

*mortgage brokers are neither qualified nor required to give you accurate financial advice as to the risks and options of your investment decisions (unless reform has been undertaken that I don't know about, this would not explain the continued exuburence for property in Australia though).

30 Doodles

Well the drawing component of this blog is very peak and trough. For the past 30 days (ending Sunday) I was participating in a facebook challenge to draw a doodle a day for 30 days. Here are my contributions:

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

14.

15.

16.

17.

18.

19.

20.

21.

22.

23.

24.

25.

26.

27.

28.

29.

30.

But I can't Make Them Drink

Last week a friend asked me to talk another mutual friend out of investing in the property market, which they would call 'buying their own home' which may seem like an odd request but taint so given that we three all belong to an organisation that rails against the unethical speculation and monopolasation of land. And since buying a home is really buying a 'house + land' proposition, it could concievably not be out of bounds.

But I declined as an exercise in futility. A) I'm not qualified to give financial advice so B) it would just amount to criticism and C) from the point of view of monopolising a natural resource, you may as well own your own home than pay rent to a monopolist (strictly from an ethical, not financial point of view).

I rail against property investment a lot, and my experience has been that people will nod and say 'uh uh' and act like they absorb everything I say and take it on board then go get a large mortgage and invest in the property market.

Hence as they say 'you can lead a horse to water but you cant make them drink.' And broader than somebody as widely uninfluential as me, this is true of high profile advisors like Steve Keen, Peter Schiff, Scott Pape, Michael Hudson, Robert Schiller etc. They are on record as predicting the GFC (though being unable to prevent it) and stress and emphasise the true risks of property speculation and urge in their capacity to offer general advice for people to stay the hell away.

And yet, these high profile prophets of economic disasters and personal financial tragedy have little or no impact, as do I. Why is this? I feel the answer lies mostly outside the sphere of economics and has more to do with marketing.

1. The Perceptual Cage

In the landmark book by Al Ries and Jack Trout, in my mind THE book on marketing: Positioning the Battle for The Mind. Ries & Trout pointed out the futility of comparison advertising, using the example of RCA copywriting that took on then market leader IBM 'Head to head RCA wins...' or something, basically the add reeled out RCA technical specifications and compared them directly to IBM's. Therefore 'proving' that RCA was a superior machine and thus IBM customers should switch over. Nothing seems more self evident, Ries & Trout though pointed out that 'consumers' minds don't work like that. In thier mind they know IBM's are better (even though factually speaking it may not be true) and as such rather than rejecting their perception, they will reject the evidence to the contrary.
A more modern example being the Mac vs the PC, from the 80's through to the 2000's Mac user groups were eternally frustrated that what they thought to be objectively better was not subjectively percieved as better by the vast PC using majority. Now the reverse is probably true.
You can also look at nationalism as an example, Noam Chomsky simply goes through publically available government documents and records as well as free press archives and can routinely show that US foreign policy is to crush democracy and any social programs, seize natural resources and spread poverty throughout Latin America and the Middle East. It is all on public record.
But everybody knows that US foreing policy is to protect the world from tyranny and defend democracy wherever they can. Thus people will reject mountains of bona-fide evidence in order to keep the perception.
So so, when I tell people that ABS data clearly indicates that Australia's housing stock is in oversupply and new housing projects are roughly 14% more than our population growth demands, people reject the ABS data, they won't even look at it because everybody knows that our population is growing faster than our housing supply.
Or even when you suggest that California made the exact same arguments right before the GFC revealed an enormous housing glut in California (and the source of all present economic woes) people will not consult the facts because the facts don't match their interpretation.

2. Contrary Evidence

I can't predict when the housing market will crash, I simply predict that it will, and the sooner the better.
But prediction and the evidence to support it is a difficult matter. For my prediction I just need the market to crash once, to disprove my prediction you would need the housing market not to crash every day for the rest of my life.

Now housing occupies a quasi gray area of prediction.
For example if I were to entertain the hypothesis that I was immortal and submit to you every day I have lived so far as evidence, you would reject my claim andf substantial evidence as plainly ridiculous because everybody is 'immortal' right up to the moment they die.
At the other extreme if I submitted to you a table of measurements of the distance from my mattress to the floor every day I got out of a given bed and said that the table values were 'inconclusive' at predicting the distance from mattress to floor tomorrow you would say 'nonsense, your bed isn't going to change height over night!' and accept all the evidence as proof of the unwavering distancde from my mattress to the floor.

But property, if I say 'property prices will crash' people will take the daily evidence that it hasn't yet, as evidence that validates the hypothesis that it wont.
People will have a ready supply of empirical data points to contradict my claims right up until the day house prices tumble whether that takes 30 days, 60 days, 180 days, 3 years, 10 years etc.
The only useful thing I can do is predict a 'crash floor' thus the longer it takes for the market to crash, the greater the distance between the peak and the rational price floor (which it will probably overshoot and create bargains).

3. Life Story

This is perhaps my most controversial and depressing claim. I have long held the theory that certain luxury goods exist because people need something to spend their money on. SOmething Ricardo Semler calls the Da Vinci Constraint. The existence of $10,000 watches I submit as proof of my theory. Whilst a case could be made that not having a watch could cost an important buisiness person $10,000 I don't think a case could be made that a $150 watch would not suffice in averting that disaster.
In plain speak, you would never get $10,000 value out of a $10,000 watch, they are a waste of money.
But you are rich (hypothetically) you have lots of money, what is the point of earning more if you have nothing to spend it on?
Thus prestigious brands cropped up in the 90's and 2000's during the good times (and the 80's before the last big crashes) so that people could keep spending even though they had far more wealth than they needed.
Now here's the amazing part, I've almost always earned more money than I needed. Having savings ratios in the 30% range. Evene when my wages are objectively quite shitty. I'm a special case, in that I don't really drink, or use a car so my weekly expenses (excluding rent) are about $100, maybe $120 if I'm being luxurious.
It's pretty easy to beat $100 a week. It's still easy to beat $300 a week with rent and bills added.
But if like most young Australians you drink and drive a car, you need to beat like $500 a week which is hard on a casual uni-student job but still pretty easy with an entry level full time position at about $30k a year.
As such, by the age of 28 you should be like me - that is earning more money than you need to survive, and saving.
Now most people don't have any particular dream or ambition, if they do it's short term like a holiday around the world or whatever. Most people don't want to finance a cathedral or make a movie starring themselves. So the savings are sort of doing nothing.
They are (no offense intended) rat-racers. They are in the rat race racing for an elusive happiness. Life can become void and meaningless because few jobs are truly infused with meaning, they involve checking financials, running reports, focus groups, attending trade fairs, visiting customers, researching polymers in a lab etc. The vast majority of jobs simply don't bring a tear to the eye, they provide agregate benefits through consumer durables that have an individually small to insignificant impact on peoples quality of life.
The answer to to much money not enough meaning? Get in debt and buy a house.
Once again the universe is in balance, you need more money (hence justifying ambitions to climb the corporate ladder, work longer hours and spend less time with your family) and have a long term goal (paying off a house, never mind the unlikely outcome that you actually live in the same place for 10 years, or even 3).
Most people reject my and other commentators warnings about the property market I feel because put simply - payign of a house is their reason for living/working. If they gave it up and sold out they would be at a loss. They can't because they cant imagine a better use of their money, or one that in their eyes involves less risk (even though I would argue the risks they are currently sitting on are enormous).
Thus my gloomy outlook and outrage is merely distressing.
This thoery depresses me though and I hope it isn't true.

4. Laziness and Greed

I suspect the overriding attraction to property is greed/laziness. I most commonly try to compare property investment to business investment (if your rent doesn't cover your mortgage your house is losing money, would you buy a business that was losing money? Would you borrow $300k to buy a share portfolio? If not, why would you do it to buy just one house? etc.) but these really shouldn't go without saying.
I shouldn't have to question why an assett that costs you more money than it earns currently (makes a loss) should sell for a higher price than you paid for it.
But I do, and I blame largely what I call 'the Biggest Loser tragedy' let me explain:

The Biggest Loser is a wonderful tv show and one of the few bright spots to come out of reality tv. In it overweight people are finally forced to work hard and eat right to get their weight off. No short-cuts. The program is paid for by advertising, the advertising most often features former contestants plugging quick fix solutions like Slimfast, Fatzap etc. Encouraging over-weight people to do no work and seek an effortless solution.

The attraction to property is largely under the same money-making ethos as the dieting products that directly contradict and subvert the Biggest Loser's message to fatties. Namely, don't worry about working hard at creating genuine value through productive enterprise, simply buy a house, don't maintain it, charge rent and earn 'passive income' by flipping it at a profit.

Just as the track record of crash diets and fads support the notion that even if real weight loss is achieved the benefits are short term - so too the long term history of property suggests that the returns from property investment are outdone by 4-6% in securities investment (shares).

But shares are a lot of work, they are a lot of work becuase companies create value, property doesn't. You need to pay attention o the companies you own, you don't to a property, many believe you don't even have to rent it out.

When all the real alternatives to property involve, work, knowledge and understanding. Many who hear my gripes on property do nothing perhaps because they simply cant be bothered.

5. Terrible Advice.

There's these two guys that were topping the business books best-sellers for a year or two with a series of books on how to legally reduce your tax, create lasting wealth etc. They advocated investing in property and 'helpfully' clarified myths, like properties should be 'cash flow positive' etc.
They also assured their readers not to listen to property naysayers, their advice 'if anybody is telling you not to invest in property ask them how many properties they own.' As if that somehow disqualifies somebody from offering qualified advice.
I read this statement as ridiculous because it is the equivalent of saying 'if your doctor tells you you should quit smoking, ask him how many packs a day he smokes.' Or 'if your friend tells you you are drunk and shouldn't drive home, ask him if he has ever driven drunk.'
Plainly, if somebody is telling you to buy property, you would hope at the very least that they had some exposure to the market themselves ie. they eat their own cooking. But if somebody is telling you not to buy property, you would expect for them to have no property exposure, (or I guess to have fully paid off their property).
But these are minimum requirements, what you should really be asking is who is actually qualified to give advice? Here's a clue, I'm not, the newspapers aren't (because the message is general not specific), your parents aren't, real estate agents aren't, mortgage brokers aren't nor is any member of the general public. Seek out an actual financial advisor and check their creditials rigorously, don't ask for their predictions, ask for their estimations of the risks and probable returns.
Alas, people won't take this advice either, they take the initial advice, dismissing anything I, or other economic commentators say because they aren't invested in the very asset they are telling people NOT TO INVEST IN.

Concluding Remarks:

One of the most depressing things about being in the scant few who think property is a bogus investment right now is that those that share my views are largely competing for bragging rights. The housing market will collapse one day and they will say 'I told you so.' Some may even have invested such that they profit immensely from the collapse and sweep in to buy up properties at bargain basement prices.
I don't really like this, its ugly and opportunistic. I'm genuinely frustrated and upset that people don't listen to me, (though relieved people don't follow my recommendations because I'm not legally allowed to).
If the housing market crashes, by 40% or so, I think the first thing I will do is get very upset at my parents. Largely because they are an on-hand face of the generation that is unwittingly pressuring their children (my peers) into getting exposed to this highly speculative market.
Why? Because their naive grossly unqualified advice is potentially ruining their own kids financial life. I hope most of my friends are still young enough to sell out, cop the loss, declare bankruptcy and try and preserve a few assets by hiding them in their parents garage for a while.
But the others, who will hang on to the property for 20 years, servicing a mortgage on a negative equity waiting to sell their property at a price close to what they originally paid for it achieving a return of 1% or so after adjusting for inflation I really just feel so sorry for, and I'd apologise for not being forceful enough or getting qualified sooner.
Theirs risks of course, and wherever their are risks their is money to be made. As I said, I have no idea when property prices will crash, I simply believe they will.
I'll be pissed off if people turn around and blame me for not talking them out of it, but I'll also take it to heart. I will blame myself, because almost inevitably I back off somebody thinking about buying property because A) I don't want to upset them & B) I have to declare my own uncertainty.
The best I can do is try to point out that the risks are there though, so you are better informed when you take them. As Scott Pape says: 'remember, all the people urging you to get into the property market are the same people trying to sell it.' whether they be your parents (financing their retirement) or real estate agents (making commissions) or mortgage brokers (charging you interest), or newspapers (selling real estate advertising).