Wednesday, December 31, 2008

Some Suggestions

My colleague, partner and friend Rashid Ashraf excellently suggested that while I am wailing away at how bad things are, that I should equally try to provide some answers, insight or at least approaches. I think that Rashid is spot-on right, so let's review the situation in another light.

1. If we are going to socialize, and it appears that we are long down that road, let's do it the right way; admit it, and get on with it. What that means is that if we give money to banks, they need to be accountable to the taxpayers who have, ultimately, provided this funding. Whoever we give money to needs to adhere to the same standards...we can't have a quasi-capitalist system...either this is social support or it isn't, and if it is, then information must flow freely.

2. The car companies, worldwide, need to start consolidating; meaning merger, and whatnot. How many factories do we need anyway? What's more, Rashid's astute observation is that GM et al have to liquidate their inventory even if this means virtually giving it away. This will generate cash, reduce government responsibility, possibly help stimulate the consumer economy and so forth. Zero percent interest, as recently reported doesn't do this because of all the hidden costs associated with new car ownership. 2 for 1 programs would be far more effective. Let's admit it, the new car inventory is a declining asset so whatever you can get for it is better than what you have now.

3. Bankruptcy is not the "f-word." The car companies for one, should embrace this so that they can repudiate their disastrous labor situation...airlines have been doing this for years. The lame excuse used thus far is that people won't buy a car from a bankrupt company. Well guess what, right now people will not buy a car from anyone.

4. We should immediately halt ALL real estate foreclosures, again in the spirit of socialism (and I hate this concept, but it is, in my view inevitable.) This means than any residential or commercial owner/lessor who is willing to pay a reasonable, market-adjusted rent should be allowed to stay in the property. There is nothing worse than an empty house or factory...when and if things realign, these rent payments should be credited to restoring the equity positions. The residential problem has been detailed ad nauseam in the press...the commercial problem hasn't hit us yet but it will soon.

5. Pro activity is a virtue and we should use it mercilessly. For example, forget about health care in general...hospitals all over the country are about to go bust. Let's get on top of that one before we have to enter reactive mode again and run the Monopoly printing presses again.

5. In the same spirit as #5 above, we have to start planning for hyper-inflation, which is the ultimate consequence that attends printing Monopoly money. If we get on this problem right away, we may be able to abate it somewhat. Ideas include privatizing public properties, possibly even including the national parks. Hell, the Garden State Parkway is up for sale so why exempt Yellowstone?

6. We should pay people extra to work more years. In order to alleviate the growing Social Security problem, why not have a "tax-free" zone wherein, under a certain earnings amount (I have not studied numbers enough to suggest a threshold) whatever you earn beyond, say, age 55, is tax free, as long as you don't draw on your SS account.

7. The United Nations is an obsolete, derelict organization. Disband it and in its place install a World Government Organization whose goal is to coordinate information exchange, and police world affairs. The point is that the Arabs (and Russia) need to realize that oil may hit $25 per barrel soon, and that there are worldwide repercussions to this. China needs to understand that people are going to be buying fewer things, and by the way, please stop being the major polluter on the planet...then the rest of us can stop spending all this money to Greenify things. Oh and India, education doesn't guarantee a job. Europe, vacations cost money, you don't get them as generously as before. Finally, in the USA, the message is get your ass out of bed (as I have to tell myself every day) go to work wherever, and innovate the crap out of whatever you do.

8. The only thing in my view that will save us ultimately is innovation. Already people are talking about MSFT, GOOG and YHOO being the next "Big Three (except there's no way the government will bail them out.") This is because they have long ago stopped being innovative...ask yourself this...what was the last MSFT product that you learned? I already know the answer. And like IBM before it, when people stop buying computers (as they have done, just like cars) the "guaranteed" income disappears.

9. My partners and I have (crazily, perhaps) rededicated ourselves to restoring innovation in America. Maybe we should move to Switzerland or Ireland instead (and maybe we will still do so, it is a legitimate option for us) but here we are putting out this stuff for your perusal.


John A.

Saturday, December 27, 2008

As I Have Been Saying For Some Time Now

We are no longer a capitalist country. We have been becoming socialist for quite some time now...first with the finance industry, then the automakers and now, even with the infrastructure.

The Western-styled world will follow suit...Japan is first in line.

If you want proof...follow the link below...who would like to buy the Garden State Parkway?


Alan Greenspan

Why doesn't he hang himself? If I were him I would have done so months ago. I keep waiting to read about this and it just hasn't happened yet. Nevertheless, he shepherded the most disastrous fiscal policy in human history...yes that's right...IN HUMAN HISTORY. What a flaming arrogant intellectual he must be. He robbed in one day what it took Bernie Madoff 50 years to accomplish. Yet Madoff's victims are killing themselves, while Greenspan's are still going to fancy New York restaurants.

GOD this sucks.


Things Are So Bad It Isn't Funny

Here’s proof:

  • Who the hell would fly into DC on a $40M jet to ask for a multi-billion$ bailout…would that even cross your mind?
  • We have job losses that are unprecedented.
  • Mayors are warning the public to arm themselves.
  • Ammunition is flying off the shelves faster than it goes on…this has nothing to do with Obama…and everything to do with social-stability as my NYC acquaintances are loathe to admit.
  • I have original research that demonstrates that morals erode exponentially when the economic foundation caves.
  • The press is underplaying this severity, although US News is beginning to get the picture.
  • The big 3 automakers will fail—if we give them $34B we will just be flushing that down the toilet. Every carmaker in the world is in trouble—the most efficient and the least efficient—who the hell is going to buy a new car right now?
  • Nobody understands that in the United States, there are more guns than people (registered+non) and that this is isn’t distributed proportionately. For example, in Michigan, Ohio, and Indiana (hardest hit by the auto debacle) there are more guns than people.
  • Real estate, long a bulwark of the US economy, is in trashes, and is eroding net worth by the second.
  • Oil is below $50 per barrel which some welcome, as I do, but it will hit <$30 before 2009 ends and this will destabilize economies like Russia (the #2 producer), and this will have a global impact.
  • Retail sales, bricks and mortar and online suck and will continue to do so for a long time to come. Retail health has buoyed our economy for longer than it should have.
  • The Fed Chairman (the man behind the curtain) manages to use the phrase “Great Depression” in a seminal speech…why would he make such a comparison if it weren’t on his mind?
  • Restaurants are empty in NYC except for those that cater to the ultra-rich…I can attest to this first-hand although I do not frequent those beyond my modest surroundings. My minority interest in a Cupertino place, right across from Apple, isn’t worth shit right now even though it has paid me the original investment each year for 20+ years before now.
  • If you haven’t lost your job yet, you will.
  • Innovation in America is stifled because there is no credit and no capital.
  • Your credit card available balance will be cut in half; no matter how credit-worthy you are because lenders are scared stiff right now.
  • Universities and colleges are burying their heads in the sand for now, but there will be a massive out flux of students from prestigious private universities (aka Harvard) to public institutions. Harvard just announced a 22% diminution in their endowment (from investment performance,) analysts peg it more like 30% and I suspect it’s 50%.
  • IF (and big IF) we manage to pull out of this thing, all the Monopoly money that is being printed worldwide, including China will cause the most massive deflationary inflation seen in world history, and will make the Weimar Republic seem like a picnic.

Sorry to be such a jerk but I have too much time on my hands and I have been studying this thing for far too long, since it won’t go away.

Good luck.


A Monograph About Why Magic Works

Since I was ten years old, I have been practicing magic and have entertained thousands of people...the reasons for this don't much matter so I won't go into them. But this past summer (July 23, 2008) an article was published that suggests that magicians know more about human psychology than scientists. The team responsible for this was from Durham University in England and the University of British Columbia and included Derren Brown and Dr. Gustav Kuhn. I have never heard of them so I don't know if they are reasonable magicians or not.

The study concluded that there are three fundamental elements that make magic work, and help to alter our perceptions: "misdirection, illusion and forcing."

While I have no particular differences with the study's conclusion, after decades of of work, practicing and such I think that their description is very simplistic. I have many more categories that I would add as follows:

1. Disarming the audience...they don't know what you are going to do so you can use myriad techniques to keep them off balance. The best way in my opinion is to always use common objects; coins, cards, rope etc. so that nothing fancy seems to be happening.

2. Misdirection as noted by the authors...but this is more about voice, body movement, original stance and such. Juan Tamariz the noted South American magician has reviewed all this in the excellent and rare book "The Five Points."

3. Timing. The aforementioned authors do not mention this one bit and it is a critical element. When I do a trick, I may need to skip a beat or two because:

4. Memory is also an element...people don't remember short-term things for very long, so if I hesitate for a second or two, they will immediately forget what they recently saw.

5. Angles. You can produce miracles by adjusting your body and line-of-sight just so...I did this yesterday and blew them away. If you don't believe me, look at the "wrist kill" for 10 seconds.

6. Suggestion. If you explain what you are going to do, then people set up in their minds what they expect to see. When you do the opposite, it confuses them to no end.

7. Technique. This is standard. You have to be able to successfully turn a double or vanish a coin...but this is the "illusion" referred to by the authors and frankly, it is the most trivial part of magic. So is forcing...very mundane indeed.

8. Patter. Every great trick needs a great story. This confirms the illusion, interests the audience and affirms everything that you are doing.

9. Expectation and repetition. As mentioned above, nobody knows in advance what you are going to do. Unsuccessful magicians get flustered when they blow a trick, better ones just change the trick so that it isn't blown. If you can do a trick well, then you can repeat it...see Ambitious Card for example.

10. Explanation. Nobody really wants to know how the magic is will wreck their experience. But if you have "regulars" as the famous Jay Sankey points out, every now and again it makes sense to "give them one." In my case, I actually ask them to commit to forever performing the effect, and if the thing involves a gaffe, I go back home and make it for them.

11. Tension. Magic requires extreme tension between the performer and the audience...why wouldn't it...we as performers are doing the impossible and you as onlookers are expecting to expose us. Tension abatement at the proper time allows for the most enjoyable experience for both parties. Humor and self-effacement from the performer are major factors here.

12. Confidence. If you want to be good at magic, you must think you are good at's the consummate sales pitch. Whenever I conclude an effect, I try to surprise myself...obviously this isn't altogether possible and is somewhat tautological, but if I am not astounded by the audience's reaction then I probably have not done the magic well enough. In other words, be your own worst critic.

Respectfully submitted to the magic community.

John A.

A Not Too Rosy View Of The World

With or without government bailouts, the auto industry, worldwide will fail. Look at it this way; anyone who needs a car already has one, and if you don’t have one and need one (my young daughter) you’ll borrow or buy used. If you’ve driven coast-to-coast along Route 80 like I have, then you should be able to predict what will happen next. Whole towns beginning with Detroit, Dearborn, Hamtramck will collapse from the ensuing domino-effect. The calamity will extend to places like Flint, Gary, IN, South Chicago and Chicago’s south side. Moving further West, Milwaukee will get hit, and to the North, Minneapolis. Running east you’ve got Cleveland, Cincinnati and Columbus, not to mention Youngstown which is already blighted but will become obliterated, and even Pittsburgh. The Pocono’s will suffer because people will not be skiing this winter. Car pooling will become the national pastime, and oil prices will drop below $30 barrel. This will engender great social rancor if not over time, upheaval.

There’s more. Since Russia is the 2nd largest oil exporter, and lacking much else besides weapons, vodka and caviar, it will cave in as we are already witnessing. And China, having nobody to export to will also deteriorate. In response, I expect that Russia and China will revert to their Communistic ways. The US, Canada, Mexico, England and the rest of Europe will adopt a form of socialism; hell we are already nationalizing all the financial institutions. Singapore should be fine…who cares. India will relearn what starving is.

After a few years and some stability in the “new order,” we will see worldwide hyperinflation because of all the “Monopoly money” that is being printed to shore things up right now. As in the Weimar Republic, we can foresee what happens during hyperinflation…it isn’t pretty and it takes a dictator and a world war to escape it, or so it did.

There’s more such as Silicon Valley’s demise (see the recent Intel announcement), empty (closed) restaurants in San Francisco, San Jose, Chicago and New York and a massive rebasing of our society.

Jesus I hope that I am wrong but the logic seems inescapable to me.