Economy Warfare

Economy has since been part of human civilization. Together with other social system, it make civilization sustainable. The influence of economy become greater when the standard of living of each become better. "Too much to lose" and "Something to lose" make military solution less desirable when come to political dispute. Invasion are no longer within the scope of physical intrusion. Economy has evolved into a tools to extend one nation power to control over others. It has now become a very important national security matters. In modern day, who control the economy take command.

The first economy weapon - IMF. IMF was established on July 22, 1944 at Bretton wood conference to stabilize international exchange rate and assist the reconstruction of international payment system after post-worldwarII. It since become a tools of great western civilization to exert their influence economically to the rest of the world. It was a desperate time for most of the nation to recover from it devastating state after post-war period. Resources was scarce. It was very justified for most developing countries to turn themselves to IMF for monetary assistance. The IMF then will impose rules and regulation to country who ask for assistance, on how they should run their economy policies, hence indirectly directing the social structure of the country. Such instrument was the on of the kind solution for west to keep their control power over the world. It was a brilliant idea at brilliant timing.

The Second instrument used in economy warfare is fiat international currency. The nation who her currencies is nominated at the sole single international trade currency will have the privilege not only control over the international trade, but literately able to enjoy free commodities and products from the rest of the world.

The third kind of instrument is financial instruments that has become greater in term of its complexity. The derivative and leverage market has the power to overnight tumble a nation economy. Economy pitfall during 1997, 2000 and 2008 were great example for what derivative market can do to the market. It is a time bomb that nurture economy perfect storm. As the concept of money and trade become more virtual and electronic, the efficiency for economy damage to spread are at the speed of light.

The fourth kind of instrument is debt. Debt was never a concept that well accepted until recent day. Debt was perceived as evil and bad during our grandfather time. But it was history. Today economy, debt was the main propulsion system that keep it run and growth. Banking system promote debt. People has to take debt in order for economy to growth. It a U-turn road. Houses, cars, educations, vacations and household expenses, are all feed by debt. It make human to become slave to pay back the debt. It was the ultimate weapon to control over billion of population.

For all instruments discussed above were just some of the example of how economy become a weaponary system in modern civilization. The reality of economy warfare cannot be undermined given the potential treat to our world stability. With collapse of one economy, military resolution will become inevitable. The good news is, it is possible to have a win win version economy environment. It is up to political leaders of great nations to face the reality, to decide, if not make move, to create the version of future that is good for everyone or otherwise.

The Universal Economic Formula

Since human began to form complex civilization, economy and trade has became the beacon of stability. Stability is important for peace and growth of the society. Without stability, a civilization can fall. 

Knowing the important of economy within our civilization, it is essential to develop a right formula to produce a right equation with the right variable. Since industrial age, economist had cracked their head to seek for the right answer. With trial and error, empirical experiences has contribute a significant progress to the finding. 

The history has shown us that ineffective economy system and poor implementation will hamper the civilization progress. It take a good implementer with a right system to produce sustainable economy ecosystem. However, there is no universal economic formula. The reason is due to the nature of economy itself is made of people, tradition and culture. With different situation, culture and environment, one kind of system can outperform others. While some system are good at beginning, but require radical changes when certain milestones is achieved. The key to success is to acknowledge the formula is rather dynamic than a constant equation. It require continuous progression, versatility and adaptability to react with social environmental changes. 

Capitalism and laissez-faire free economic system is considered to be as our current mainstream, most advocated effective economy system preached by the west. The america empire is the ambassador for the capitalism economy model. The system work so well (Even not until recent days) is mainly contributed by the nature of the american culture which are more to individualistic and self-dependency. The discipline of each of individual to take hold their own fortune condition and wellness as their own business to take care. Such culture and environment favour capitalism to work. The invisible hand of adman smith is strong under such given circumstances. However, it does not work well in the eastern nation counterpart such as China, Korea and Japan.

Japan was at his pinnacle of  economic achievement at mid 1980s. She become the next economy power house next to america from the state of poverty and at the brink of total collapse due the product of post-war. However, the economic miracle was not the product of capitalism. It is socialism in principle but capitalism on wealth distribution. By monster Sahashi, the ministry of MITI, Japan Inc was formed. It was a government bureaucrat center planning model which dictate the course of economy path by induce incentive to favoured industry, and implement protectionism to protect local businesses from foreign treats. It is a model where government in principle control all the capital and resources, and decide who and how it should be utilized. It is believed that, a center controlled system can eradicate wastes due to overlapping efforts by private sectors during the trail and error to achieve development progress. It is believed that, by putting together the resources, the center government who think they know what is best for the country can be more effectively allocate the resources to produce a much better result. It work well, and successfully transform a country that has nothing in principle (Natural resources) to a country that produces almost everything from heavy industry to electronic to automotive, to consumer products. The hindsight, that socialism tremendously work well in Japanese society is contributed by her society tradition, culture and environment. The Japanese are collaborating in nature, and less individualistic. They believe in the society system that ruler is what decide the course of nature of any future event of society, good or bad. They are tuned in the mood of following vision of the ruler, and work the best out of themselves to achieve each given tasks. They are less self-interest and believing in serving something bigger than themselves for the betterment of lager picture - the society as a whole. They able to endure delay gratification in nature, and preaching the idea of work hard for the nation is a noble. Such environment making socialism the most effective system suitable to Japan, and also China, Taiwan, Korea and Singapore who somehow share the similar culture and societal belief. 

The concept of economic formula is rather a dynamic tuning and discovering process rather than a universal static equation. It is a conditioning formula decided by its variable such as economical and societal culture changes. It means, a well proven successful formula might work well at certain given time, conditions,  nation and cultures, but could not sustain a different set of situation. There is no universal economic formula.

  

Currency

Bretton Wood was the monetary system before 1971. It mark the important milestone of paper currency for the first time, made international. The currency was U.S dollar. After WWII, most country was struggled to rebuild their situation. United State industry is the least affected by the man made disaster. The rest of the world were required to import products from United State, for many could not be produces locally due to war aftermath. Taking a step further, United State introduce bretton wood to replace gold standard which was practiced for international trade. It was promoted to be a much more convenient way to trade. United State also promise for every 35 U.S dollar is exchangeable an once of gold to strengthen the confident of the system.  Furthermore, the rest of the world during that time, was running out of gold reserves. Most of them were consumed and traded for military supplies during WWII. It was the direct relief for the rest of the world, given the situation they had during the time.

Vietnam war raged. Excessive U.S dollar was printed. The world begin to question the trust worthiness of the currency. Frenzy panic set in, where countries begin to trade most of currency reserve with gold. Noting the situation could be irreversible, President Nixon took a audacious step to abolish Bretten Wood to secure national interest. Fiat currency was introduced. Currency was no longer peg with gold. It become a debt instrument. It is a government backed set, guarantee by the political, military and economy stability of the country. In a simplified way, the trustworthiness of United State tax payer.

The fiat currency system is a leverage instrument to enable people to borrow future resources for today immediate gain. It like a catalyst that accelerate the chemical reaction of economy. It make most of the average people a channel to access to many luxury like houses, cars and expensive vacation. It made rich get richer quicker. It make country (United State) to strip off anything in the world for her own interest quicker, faster and efficient, with penny of cost. It is a house of card that required continuous feeding of debt. It is a two edge sword which on the other side a international ponzi scheme.

Fiat currency was since then adopted internationally. 169 countries in the world share a common currency as international reserves for international trade. It means if Japanese company would like to sell cars to other country, by technical point of view, the other country is required to exchange the country currency to U.S Dollar and buy the Japanese Car. The Japanese company, then can choose to keep the U.S Dollar for reserve, or buying products from other country or buying U.S dollar dominated Assets. But, somehow, the Japanese company is required to exchange some portion of its profit into Japanese yen, to pay expenses in japan, where the car is produces. The flow of exchange  is the mechanism how each currency supply and demand will affect a country exchange rate.

The fiat currency has grown to state where no turning back is possible. The problem has begin to become more obvious. The immediate repercussion is raising commodities price and excessive inflation. Those however do not hurt everyone, at least for those who are rich and who know how to choose a side. Unfortunately, there are only approximately 10% of today world population are aware of such situation. In order to secure our future, we need to readjust our perception of currency, to avoid falling into the international currency storm, which might happen anytime soon.

What is Internet Business?

Today the world is 13 years old. The berlin wall come down at 1989 set the date of information ages. The industrial age fade out, with world wide web went up. “www”, “http”, ethernet, 3G, 4G is the new language today. What is your bandwidth? is a prevalence question to measure how powerful your internet muscle. 

By evolution of internet, businesses also evolved. “Business model”, a MBA jargon, has and had include internet as a important subject in the syllabus. Ask anyone who start a business, he or she will very likely to tell you, i am in the internet business model. But, what does it mean by that? Isn’t internet just merely a technological breakthrough in 21st century? How would it now is playing a role of “business evolution”?  

The truth is, internet is just a technological breakthrough. Nothing more nothing less. It never mean to be anything to do with business. The internet merely provide us a new tools to do things differently.  Therefore, everything, by means everything we use to do, including businesses changes. So, what is that? Isn’t such context had justify the idea of internet business evolution? The answer is yes and no. The key points is, people has caught themselves off guard of what is primary and secondary in businesses. And this is what my article is all about.

And for the record, businesses does not change in its nature. Supply and demand, profit and lost is the fundamental rules. That is primary. The secondary is the supportive factors, such as tools, management, people, leaderships, marketing etc. It is very subjective rules against the primary objective rules. The primary and secondary by logic should be jibe in each other. Unfortunately, it is not the case in today. The key here is simplicity (Objective) versus complexity (Subjective). 

Invention of paper, to writing, to printing and now internets, is a products of our civilizations. Business had since “evolved” since of every new inventions is introduced. The word “evolved” had make something that should be simple into something that a so complex. Perhaps it is the human nature of propensity to complexity. It make us feel superior, special and feed our ego. With internet introduced, business become even more complex. Stories of success, almost include internet as the rule of thumb to success, if you want to get a piece of cake in the market. Blogger, journalist, columnist, business news anchors and even business men had doing so successfully to promote internet as a most essential blood stream in today business world. It cause a frenzy in the market. That is the feeding frenzy that bring along the internet bubble during 2000. Today, consider to be the most opportunistic ages in any history of human kind, almost anyone can be a business owner, perhaps millionaire in just a few months. All cheering thanks to internets. Internet had plug in everyone to access to all the wealth available. Personally, that is over exaggerated.     

Internet did provide us a different way of doing things, more efficiently and more connected. But, in the ends it is just a tools. It by nature itself, does not make success. Today, there are many companies and business are doing extremely well, because of internet. But, those companies never a internet companies. Investors, are now speculating in “internet businesses”. ANything that is internet connected, with fair ideas and sale pitch, they are in. Take a good example, Facebook,inc. Billion of dollars is flooding the company. Making the founder so riches. But, the company itself, does not really generate any real economic value to feed its expansion and expenses. 500 millions users, big deals, but ask again, is Facebook really irreplaceable? It has a notions, with that kind of volume, doing anything will be successful. But ask again, what useful to have 500 million soldiers who cannot fight? It is just an assumption of something might and might not happen in future - gambling. Facebook to be so successful today, are mainly due to “free services” and no”advertisement” Social networking with a “simplicity” functionality. What do you think about changing those notions will make user continues to use your network? Think about myspace and yahoo!, use to be so extremely successful. Then what now? I hardly have any friends actively use any of them. And bad news, Facebook had since become less user friendly interface - complex.

Today Social networks, are many. Each is very difficult to be distinguished to each others. Each can be replaced by others in very short times. If you does not have something so special and deeply served the needs of users, it is gambling against the emotional choice of internet users. And all emotion does include boredom. When that come, it is game over.  In the fundamental of business, never lost sight of supply and demand. Demand is value, needs that in very simple terms benefit to users - civilization value. Supply is how you bring out the demand is very effective, constructive and innovation ways to make money - economy value to yourself. If you can’t explain your company in very simple terms at how it make money, and how it help people, you are in trouble. For instance Google, had since so innovate in pulling all information from all location to one stops using internet. It is not a internet business. It is an informations service provider. And by attract people to use its search engine, it provide advertisement programs to make money. Google become so successful because it make money,and it serve people. It has economy value and civilization value. Apple.inc, Steve jobs bring out a civilization value by its products. A digital lifestyle notions that make people life more interesting. Never about icloud or machine that could bring you to internet. Now it is the no.1 market capitalization company in the world, surpass Exxon Mobil. It has both economic and civilization value. Fedex, logistic, provide supply chain solutions to customers. Civilization value - delivery of urgency, feedback, management package to her customers. Customer like it, and it make money. Never about the internet tracking systems. Paypal, security and connivence service provider of payment gateway. People like it and use it. It charges minor fee during withdrawal . Therefore, it make money. It never was a internet business. There are many more example you can think of. The internet just a tools they use to get out of the best to his customer need. “connected and efficient”. 

As conclusion, there shouldn’t be a notion of internet business, unless you are at&t or license ISP. Never over react by the notions of include internet into your business strategy. Internet is a two edge swords if you does not use it properly as any other weapon and tools, it might hurt you. Master the primary rules of business - supply and demand (Economic value and Civilization Value). The secondary supportive factors should be very flexible depend on your circumstances and needs. Never caught your in the “internet frenzy trap”.      

New World Order

On the hindsight of the past 50 years and so, we believe that we had enjoyed one of the longest peace time throughout recorded history of human kind. Yet, there been many prominent threats within that false sense of security. There are many controversial theory, conspiracy, ideology and hypothesis on how our world will once again fall into the pit hole of savage - the collapse of the modern civilization. From energy, to jobs, to economic, to politic, our world has never been on peace but a truce setting up by nations after the WWII and the Cold War. We never, in fact on this context never learned the mistake we took. We just pushing the problem forward.

The idea of civilization is a mechanism on how our society work. Society work when the mechanism is fair, efficient, regulated and unified. On all above, we however able to achieve all but "unified". Today, the united nations have roughly 192 nation in members. That's counted to be at least 192 distinctive regulator, government and system through out the world. Distinctive by means different. Different by mean will ultimately create friction and conflict of interest. "What a power man desire? More power!" As we all human by nature is a selfish creature, everyone, every nation will do whatever it takes to safeguard their own interest, in the expense of world peace. Imagine how does the conflicts of conflicts between 192 nations could produce? The Moore's law will do the math. The more unfortunate event is that the chamber of United nation as a mediator did not do any good jobs to be a body to solve any conflict within her members. Syria and Iran tell the case. By continuously to maintain separate governments and separate nation policies in our world, we will eventually repeat the mistake of our ancient civilization. The only way, for our civilization to leap to a next level is a one unified world, regardless of race, color, language, religion and ethnic. A new world order i would like to say here. One government, one people, one nation, one system.

There are many things we could not do, but we capable of doing, for the real benefit of the world, and for the continuity of our species. However, the only factor that limit us from doing that is we live in the non-unified world. For instances, energy crisis had happen since 1990s. We are so dependable to fossil energy, and other non-eneviromental friendly means of energy. Todays, our scientist have warn about the disastrous that our energy policies will bring to the world, and urging us to swift to clean energy resources such as solar, wind and hydro. On the technological pint of view, we indeed has the capabilities to do it. But what really stop us from execution, is not the switching costs, but geopolitical issues that raise. On the scale of so many different kind of government exist today, for any new idea that would undermine certain group self-interest will definitely jeopardize the change movement. Others, from the point of view of economy, for instance, today we are on the trade which countries with cheaper currency and man power will have an advantage toward the counter part countries. As trade boarder between nations become easier and easier, we are on the economic system of win-lose scenario. Someone has to lose in order to someone to win. This is a very unhealthy scenario whereby in fact the world we are living is set up for everyone to win. On the win-lose idea, conflict a raise, and therefore, a new problem from such conflicts will just a downward spiral, like viral that will eventually eat up all the resource, energy and understanding between nations involved. There are many more to think of...

Today, we live in the time of uncertainty. Economic crisis, energy crisis is eminent. Even some has speculate the world war 3. The problem are the by product of non-unify world orders. For we all are suppose under the same decedent, and evolution has making us apart geopolitically, we all are actually the same, apart of a superficial differences. For our future survival deep lie under how our society system direction moving to, should we not move into the "new world order", with one idea, one nation, one people, we will no choice but to stagnant in our civilization, by than, our existential will be undermined. There are much to discover, to achieve by us. It limits is not by technological but by the nature on how our live today. More the price to pay, or the scarify to make, there are something that we must do, if we want to make changes. "Insanity is doing the same things everyday to expect a different result tomorrow!"