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October 17, 2004

Acts of the Apostles
by John Mackenzie

After an empty day of fishing offshore, the Financial Maladies plaguing our Nation began to fester once again. It's difficult to read or even listen to the whirling din of analysis surrounding the perilous nature of our position at present. And looking forward to a good tug of war with a large sailfish, tuna or mahi-mahi sounded like an excellent reprieve.

Instead, the round trip reminded me of just how devastating natural events can be. What had been a 14 foot bottom was now 25 feet. Ten plus feet of sand erased from the sonar and along with it hundreds of thousands of baitfish. An entire Eco-System dependent upon one another for survival was gone. Buoy 14, a none to subtle reminder of just how fragile the balance, resembled a desert at sea.

As Steve, Stephanie and I headed back towards the inlet we remarked how this seasons fishing had provided us with amazing bounty. We "Valued" what we had lost in terms beyond an immeasurable "Price" and recognized it would take a very long time to restore these hurricane ravaged waters to their former abundance.

For many years I have suggested Deflation is simply a structural phenomena, Inflation, its nemesis, an illusion brought about by the metrics of the "Price of Money." This hypothesis runs counter to interpretations of conventional and contrarian analysis put forth on increasingly shifting grounds. Look no further than the sound and fury surrounding the "Synthetic Dollar Short" debate and its billowing plumes of analytical framework that rival, forward, 50 year predictions as to the future of our social, economic and political structures. History's pages may find little room for these summary judgments.

The contextual limits of conventional analytical ability, suspended in stasis by illusory linearity; has the past has been brought present? What are the historical norms and how do the relationships apply? How has the only constant managed to confound the very nature of change?

We have so grossly stretched the bounds of rational; a lie becomes the truth if repeated frenetically enough. Diminished simple concepts with refractory abundance of subjectivity; the facts are washed, rinsed and spun into convienent archetypes, excuses masquerading as reason. Logic looking for reason, cause ignoring effect...

Although there is a collective sense something's askew, I am of the opinion the collective is missing the mark by a wide margin, much in the same way our Presidential Debates were essentially a non-starter for the real, relevant issues we face. The rhetoric was merely compound obfuscation by orders of absurd magnitude. "Vote for me, he's a Liberal" does little to further this Nation's future prospects in my opinion.

Which brings me to the point of this diatribe: Deflation is simply "Value." Inflation the polar opposite, "Price." Inflation serves to disrupt the Value: Price matrix by removing stability from the Socio-Economic system.. And in doing so misinforms participants as to consequences of their selective order. What have we furthered?

Money has undergone a remarkable shift during the past 90 years; the moneyness of money far more so. Relationships once heralded as constants are being tested and failing to muster a passing qualifier. Intervention is the culprit as stage managed metrics send signals so mixed, the entire process now resembles a malignant and disfigured growth.

Inflation represents the Illusion of Price, but chooses to ignore the Value of Structural changes so abundant within our Global Economic System. If competition is allowed as the final arbiter of Price, then Value must represent failure of repressive, interventionist policies aimed at managing balance outside of "Free Market" regimes bent upon central planning.

It is clear the Central Planners have failed the "Value" proposition, but remain lost and adjacent to their own hubris with respect to "Price". Their perpetual motion machine is in need of participants. Government, will no doubt provide the additional ticket purchases with ever increasing fiscal malfeasance. By devaluing what constitutes "Money" they hope to add more inertia to their engine. Of late, this has begun to fail as we've seen the velocity of "Price" which has allowed more inertia, begin to slowly seize.

Price & Value have waged a heated competition well into the fourth decade of the Illusory Privilege, spilling further into the non-productive and hyperinflationary Financial Economy which rewards first abusers the most. Those with first order access to new issuance of credit/debt suffer the least, the consequences of such are a burden carried best by those outside the matrix of the Financial Economy.

You, yours, me and mine.

John Mackenzie

John Mackenzie manages private capital - Email: m2jrmfl@bellsouth.net

Copyright © 2004-2005 John Mackenzie

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