Book Recommendations

Everyone Should Read

  • The Red Queen (Ridley)
  • The Blank Slate (Pinker)
  • Influence: Phychology of Persuasion
  • 7 Habits of Highly Effective People
  • The E-Myth
  • Demon Haunted World

Everyone in Business Should Read

  • Grinding It Out
  • Made In America
  • Alchemy of Finance
  • The Art of Profitability
  • Adventure Capitalist
  • Investment Biker

China Travel Tips, Part 1. Internet & Telephone

Local SIM or Int’l GSM Roaming

That is good question. If you’re going to be in China for 4 days or less, there’s not much point in hasseling with the local SIM card – since the process will probably take 3+ hours inluding: travel time, locating fairly priced SIM card dealer, installing card, verifying adaquate funds in prepaid account, subscribing for international dialing, and testing the process.

If you’re not going to use a local SIM card, you must make sure that International Roaming is active on your phone BEFORE you depart from your home country. Once you land in China, it’s too late. You’re phone won’t work, and it will be a fiasco to get in touch with your phone company.

Note that all GSM compatible phones contain interchangable GSM SIM cards. If your phone doesn’t have a SIM, then it’s not going to work when you’re roaming.

Unlocked Phones and Local SIMs

China is the biggest mobile phone market in the world, and the vast majority of thoese phones are unlocked, paid for directly by the end user, not subsidized by the carrier.

If you want to use a Chinese SIM card in your phone, you must make sure your

Mobile phone coverage is excellent in China, and prices are very reasonable. Even calling internationally via a Chinese SIM card to the USA is only 6¢/minute when you use a 5 digit IP dialing prefix.

Skype

Don’t do it. Seven years ago, when I first got to China, Skype worked great. It was hard to call overseas, but anyone could dial inbound via Skype-In, which I would forward to my China Mobile phone.

Then along came the Great Firewall. Every year, the Chinese Great Firewall gets more and more annoying, blocking more and more of the sites that you would like to access.

Now days, Skype is not reliable. Sometimes it works fine, usually for about 15-minutes, but then it drops and won’t reconnect properly for a half hour or more.

If you need to Video Conference while in China, you probably shouldn’t come – because your video conference probably won’t work.

If you just need to make some international calls while you’re here, then you are far better off using 12593 (China Mobile) or 10193 (China Unicom) “IP Call Extension” directly from your mobile phone. The connection will be clear and stable. It works nation wide. It doesn’t drop often, and if it does, you can reconnect quickly.

Ideal China Traveler Configuration

For people who need to stay connected to the world while traveling through China, the best solution is:

  1. Smartphone with Global Roaming from homeland carrier to receive incoming Int’l calls and text messages
  2. Unlocked phone (Smartphone or Feature Phone) with local SIM card from China Mobile or China Unicom
  3. 3G Access Point from China Unicom for Email access and Mobile Browsing via your Smartphone, Tablet and Laptop.
  4. Airport Express or other Ethernet based Hotspot for wireless access while you’re at the hotel or office.

Note that a 3G Card from China Mobile, valid for 3 months will provide 1.5GB of data nation wide. That’s enough for a few weeks of mobile email and mobile (smartphone and tablet) browsing. If you’re going to be trying to use IP telephony, watch any video, or download anything – you’ll blow through this 1.5GB in 2-3 days. Best off getting back to the hotel before downloading a lot.

Most battery powered 3G Access points use a single 1800 mAh battery, meaning you start using it at breakfast, and it’s dead just after lunch.

You combine #3 and #4 (3G hotspot, Ethernet hotspot with AC) with a long lasting 3600 mAh battery (2.5 x size of iPhone 4 battery) in the Sapido 3G/4G Mobile Hotspot available on Amazon for $70.

The Great Firewall

While you’re in China, accessing Twitter, Youtube, Facebook and Google will be cumbersome. If you’re not planning to travel to China frequently, it’s not worth wasting time setting up VPN access so that you can buypass the Great Firewall.

If you absolutely must access the unfiltered world while in China, you’ll need to purchase a VPN account that you can proxy your internet traffic through. These accounts can be installed on Smartphones and Laptop computers, but they are blocked frequently and very slow.

Just Google for “China VPNBEFORE you arrive in China to purchase a VPN account. They are usually around $20/month. Of course these sites are blocked from within China, so you’ll need to have the VPN configured before you arrive.

If you’re curious about the Great Firewall, James Fallows at The Atlantic wrote an excellent article called “Your Connection Has Been Reset“.

US Steps up in Asia

The Obama administration has been talking about a “pivot back into Asia” for several months now, yet we have seen little evidence that the United States is prepared to challenge China in East Asia. That may finally be changing. According to Japanese media, Secretary of Defense Leon Panetta on Aug. 5 discussed the potential for U.S. RQ-4 Global Hawk patrols over the disputed Senkaku/Diaoyu Islands.

The Northrop Grumman RQ-4 Global Hawk is an unmanned aerial vehicle (UAV) used by the United States Air Force and Navy as a surveillance aircraft. High altitute survelliance and intelligence, similar to the Lockheed U-2 1950s spy plane. Global Hawk provides high resolution Synthetic Aperture Radar (SAR) that can penetrate cloud-cover and sandstorms and Electro-Optical/Infrared (EO/IR) long range imagry. Can survey 40,000 square miles of terrain/day.

When former US Ambassador to China, Roy, now of the Kissinger Institute was in Shanghai a few months ago, he pointed out that legalistically, the US relationship with the Senkaku/Diaoyu islands is different from the relationships in the South China Sea. The US is obligated to protect Japanese interests in the Diaoyu islands as part of the US/Japan defence treaty.

Stratfor has an interesting take, that:

By suggesting that the United States will take a more proactive role in assuring Japan’s continued control of the Senkakus, Washington is attempting to assuage concerns among other potential partners and allies in the Asia-Pacific region. Washington aims to demonstrate its willingness to consistently and reliably counter any perceived Chinese overreach, allowing regional partners to feel confident about strengthening ties with the United States in spite of Chinese assertiveness.

M.I.A. – But I’m Back

Life has been very busy lately, so I haven’t had much time to write. The more I see, the less that I feel like writing about it. It seems that anything we write could always be used against at some point in the future, but if we simply stay silent – there is no downside.

There are so many things that I wish I could talk more about here. About the distribution business. About other business ideas. About personal life. Unfortunately, the three biggest things that I would like to talk about seem to be off limits at the moment.

At least there’s hope that I can talk more about one of these on a daily bais in another year or two.

We’ll see.

At this time, I can continue to share my thoughts about:

  • What’s happening in China now and what may happen next.
  • US/China relations.
  • Chinese language learning and accent perfection.
  • Business/Economics/Politics.

That said, I’ve been writing for a while, and I haven’t added a significant amount to the discussion in these areas – so perhaps the direction of the blog should be reconsidered.

subject chart

Some things that do come to mind that are worth knowing about for many people are:

  • Travel tips for people coming to China
  • Intersting places to visit in China
  • Chinese Language Learning Tips
  • The inns and outs of navigating China by train, plane and automobile

Last, I also need to improve the formatting of the Quotes on the top of the website, and provide a way to easily view all of the great quotes that I’ve collected!

Brookings: US-China Strategic Distrust

Very accurate review of Sino-US relations by the Brookings Institute. Brief (six minute) video.

Kenneth G. Lieberthal, April 02, 2010

Although both Beijing and Washington consider the U.S.-China relationship to be the most important in the world, distrust of each other’s long term intentions (“strategic distrust”) has grown to a dangerous degree.

The coauthors of this path-breaking study—one of America’s leading China specialists and one of China’s leading America specialists—lay out both the underlying concerns each leadership harbors about the other side and the reasons for those concerns. Each coauthor has written the narrative of his government’s views without any changes made by the other coauthor. Their purpose is to enable both leaderships to better fathom how the other thinks. The coauthors have together written the follow-on analysis and recommendations designed to improve the potential for a long-term normal major power U.S.-China relationship, rather than the adversarial relationship that might otherwise develop.

Watch the video

Ambassador Roy at AmCham Shanghai

Presentation focused on:

  • Future of US China relationship.
  • Comprehensive Measures of Intl Power vs Nations GDP.
  • Physiological issues are bigger.

Ambassador Roy also presented at the Shanghai Institute of Intl Studies before the []AmCham Shanghai](http://www.amcham-shanghai.org/) presentation.

  • US may be distracted by domestic difficulties.
  • It’s a psychological battle – perception – not reality
  • Asians want engagement, not “US leadership”

The Future

  1. Measured rhetoric as a tool, but don’t take action
  2. We already invest less AND trade less than China than in SE-Asia
  3. US is not competitive
  4. As China becomes more influential, why would China defer to the US?

Problem: – There will be a period where China is economically dominant, but the US is militarily dominant. – The problem is the period of time from the beginning to the end of this transition.

  1. China gets stronger every day
  2. The US gets weaker every day
  3. Time is working against the US

There is zero Int’l support for “containment” of China. Nobody is willing to go against China.

There is no inherent reason for conflict with China.

China Telecom “temp_box” Popup Ads 中国电信运营商投放广告

“China Telecom” high-speed Internet service in Shanghai is actually quite good, much better than anything else I’ve used in Mainland China during six years of extensive travel here, but I noticed ads started popping up on pages that I’m certain never had ads before. Moreover, the ads all look the same.

I did a bit of searching, and some Chinese users have came to the same (irritated) conclusion as I, that China Telecom (中国电信) is actually inserting these ads into 3rd party web pages, without any regard for the original content of the page.

If you dig into the actual page code, you’ll see something along the lines of:

Fortunately, it seems that “ct10000.com” is on the FireFox AdBlock Plus black list, so I’ve installed the FireFox AdBlock Plus plugin to prevent these China Telecom ads from popping up.

Best of luck!

Chinese Real-Estate Bubble Pops Day₀

I spent quite a bit of time writing about the Chinese Real-Estate bubble in 2009-2010. Back in 2005, the bubble (based on affordability ratios) was already evident, but post Gov’t stimulus boondoggle, the bubble turned into a super-bubble. Sometime in late 2010, I had written everything that I really had to say about it, and since there’s no equivalent of Chinese-CDS that I could find to buy and make some cash on the impending real-estate meltdown, I could only sit back, think about other things, and wait for the inevitable.

Some of the things I wrote:

Most interesting notes from two years ago?

This is exactly what China needs to worry about – when the debt is unwound, what will keep the brakes on the descent.

And…

The 2009 “Expand Domestic Consumption” (扩大内需) policy of China has been a newspaper success around the world, however, I’m inclined to think the result will be exactly what was experienced in Japan: “succeeded only in inflating the national debt”.

So here we are. The music has stopped. Let’s see who sits down, and who doesn’t. In the long run, this is a very good thing for the Chinese economy. Every day earlier means less mis-allocated resources to re-allocate.

Conspiracy Theory:

Could the technocrats have planned this all along, as a way to force wealthy Chinese to provide financing to develop new housing for the rest of the nations citizens, and crash the market enabling those less affluent citizens to buy up the houses at effectively subsidized prices?

Apartment Hunting in Shanghai

Before you start looking for an apartment anywhere, the first step it to set your budget.

I was also quite surprised to find that rents for newer (built after 2008) building are significantly higher than for buildings that are just slightly older. The reason, is due to the amount that the land lord paid when purchasing the apartment. For example, if the land lord paid 50,000 RMB/m²
2 because the unit was purchased after 2008, you can probably find a 2005 unit of identical location and near identical quality for about half the price, as the land lord would have only paid 25,000 RMB/m².

Obviously there is a status benefit, particularly important in China, associated with the higher rent location – but if you’re simply looking for a great location and a great value, you’re best of looking for someplace built between 2000-2005.

Next, DO NOT GIVE UP, DO NOT GET DISCOURAGED. Each time I’ve found an apartment that I really liked, I searched for two weeks, looking at 50 different apartment units, before finally settling on one that I like. No single agent will take you to so many places, but there’s an easy work around.

First, decide approximately which neighborhoods you would consider living in, probably something in proximity to your work, your social circle, or your preferred transit option, and then walk around on the neighboring streets looking for real estate agents. Agencies are local, and even though they can access their shared database throughout the city, they’ll often have the key to the units you want to see at an office near by.

These are the obvious things – what about not so obvious things.

1. HEAT SITUATION

Shanghai is extremely cold in the winter. If you haven’t lived here yet for an entire winter, you really have no idea how cold it gets. Most importantly, when you’re outside with heavy clothes the Shanghai winter is OK, but when you come home, stop moving and remove your down jacket, you’re in for a horrible surprise. Shanghai has high humidity, between the low temperature and the wind, it’s possible that you’ll never feel warm at home.

First thing, make sure that you’re apartment has THERMAL PANE (double pane) windows. I’ve found some amazing apartments with beautiful views, but rooms full of big, sliding, single pane windows provide approximately zero insulation value.

My advise, forgo the most breathtaking, all glass walls, in favor of more moderate window placement.

If you can find a place with either heated floors (地暖) or boilers/radiators (暖气), then you’ve hit the jackpot. These systems burn natural gas (煤气) so while they provide heat that doesn’t dry the air, they also will save you thousands of RMB/month if you leave the heat on.

2. TAX RECEIPT (发票)

Depending on your personal situation, you may or may not need a tax receipt. If you do not need one, expect to save about 5%, or conversely, if you do need one, expect to add 5%. For rental properties, there is no “standard” of whether or not a tax receipt is or is not included in the asking price. You need to inquire.

3. ASSOCIATION FEE (物业)

Under normal market terms, the association fee (物业费) is to be paid by the landlord, not by the tenant. If the land lord wants to fight about who is responsible for the association fee (物业) then you’ve probably found a real cheapskate and will probably run into other problems down the road.

Normally you will only be responsible for: Water, Electricity, Gas and Internet (水电煤及宽带).

4. WENZHOU PEOPLE (温州人)

Throughout Shanghai, a large percentage of the landlords are from Wenzhou. Almost all are absentee landlords and they generally take zero pride in maintaining a quality apartment, or providing a fair value. They are generally real estate speculators, and are generally horrible land lords. If anything breaks, do not expect your Wenzhou land lord to do a respectable job making repair.

On the other hand, land lords that have an overseas connection are generally fair and win-win oriented. The stronger that overseas connection, the better I’ve found it is to work with them.

Bottom line, if the land lord is from Wenzhou, a big minus. If they went to school overseas, a big plus.

5. WHY NOT THREE YEAR?

Whenever possible, I would recommend signing a three year contract. Inflation in China, particularly in Shanghai is out of control. Signing up for a longer contract is beneficial for the land lord, they know that the apartment is not at risk of sitting empty, but more importantly, it protects the tenant against annual rent increases. Use a longer term as negotiating leverage to get the lowest possible price, and lock in that price for as long a period as reasonable.

Moreover, if you know you’ll be in a unit for three years, it’s reasonable to make some improvements to the unit, without being concerned that you’re simply giving your land lord leverage to raise the rent a few months later.

For example, if you sign three years, and spend 20,000 RMB on repairs, that only works out equivalent to the land lord raising rent by 555 RMB/month.

You’ll also save paying out the AGENT FEE if you decide to move.

6. AGENT FEE (中介费)

Agencies try to hold off discussion of their fee for as long as possible. For the agency, their preferred arrangement is: landlord pays 1-month rent to agency as referral fee plus, tenant pays 1-month rent to agency as finders fee

I’ve even heard of cases where the tenant is to pay 2-months fee to the agency, but I would suggest you walk away immediately if your agent tries something like that.

The best case scenario is that the landlord + tenant combined pay 1-month of rent to the agency.

As the tenant, the lower you can negotiate the fee, obviously the better. Depending on your style, you may or may not want to negotiate it up front. If the agent that showed you a unit that you happen to really like seems to not be operating in your interest, and tries to charge you more than 50%-month worth of rent, then you may consider telling one of the other agents that you’ve been working with about the community/building/unit number, and they can look it up and broker it for you. This is a bit devious, so you should only resort to this sort of thing if your agent is simply doing the minimum amount of work possible and not working in your best interest.

It’s also important to understand exactly what the agency is responsible for delivering. There are a lot of lazy agents that simply pick a few nearby units that seem to be at the top of your price range (therefore maximizing their commission), take you for a quick look, and pressure you to sign the contract.

There are also excellent agents that will spend hours going through the listings databases plus their own network of contacts to find a unit that really matches what you’re looking for.

Some agents provide amazing after sales service. If there is a problem, you call them, rather than the landlord, and they will help you to resolve it. If there is some repair or customization that you would like to do, they’ll help find people to do it.

Finding a hard working, intelligent agent makes a big difference.

7. NOT FOR SALE

Sometimes an apartment gets sold right out from under a rental tenant. You should ask the rental agency if this apartment has ever been listed for sale before signing a contract. If the apartment was listed for sale, then the owner isn’t committed to holding onto the property and you are at high risk of having it sold out from under you.

The ideal situation is to have a clause written into the contract that IF the unit is sold: Damages (赔偿) some specifically defined amount of money should be paid out to you if the unit is sold Notice (通知) in addition to damages, you need to be notified at least X amount of time before sale

Best of luck trying to get the “no sale” clause added to the contract. Standard is about 30 days, and as long as the apartment hasn’t previously been listed the risk is low, but at least it gives you a bargaining chip to use with the land lord.

8. INTERNET: Slow or Slower?

Most apartment units in Shanghai only have 1MB or 2MB “broadband” connections, but some units quality for 10MB connections. If you use the internet extensively, it’s worth giving China Telecom (中国电信) a call at 10000 (一万) and asking which type of service is available in the unit that your considering.

9. Utility Bills

When handing over the keys, the land lord should give you the most current utility bills (water, electricity, and gas) and explain the current account situation. If the bills are not yet paid, then you can deduct that amount from your rent and pay it to the utility company. If the bills are over-paid, then your expected to pay the difference to the land lord.

10. Apartment Inventory

Normally all apartments in Shanghai come furnished, so the land lord will provide you with a printed sheet showing each of the items that they have provided (ie. tv, refrigerator, microwave, bed, etc), a bit like a physical inventory sheet for a warehouse. You’re responsible for making sure all of these items are retuned to the land lord when you leave, else it will be deducted from your deposit. If you want to get rid of any items in your apartment, make sure that your land lord has some location where they can be stored. Often times the land lord does not have any such location, so if you have a lot of possessions of your own to bring in, be careful to avoid apartments that are “over furnished”.

11. Payment Terms

Normally all apartments in China are “Pay Three, Deposit One” (付三押一) meaning that on day one, when you want to get the keys, you’ll need to bring cash for four months worth of rent, plus the fee payable to the agency. The agency fee could be as low as 25% of one month, and as high as 200% of one month. Also, the higher the monthly rent, it has a big impact on the actual amount of money that you need to turn over to get the keys.

12. Getting started

There are lots of websites that you can use to research possible apartments, but be advised that the “for rent” pages of these sites are full of bait-and-switch tactics, outright lies, and stale listings that have already been listed. Consider the risks when looking online, and once you zero in on a few areas that you like, just look for the actual real estate broker offices in that area.

Websites that you can use to get started include:

There are also english language oriented services, but I would avoid these unless your not concerned about paying a premium price for an agency fee.

Considering the difficulty of parking in the city and driving around rush hour, I recommend forgoing the automobile all together and simply finding a location with great subway access. By great, I mean less than 2 minutes walk to the station, which is less than the normal walk to find the parking structure. If you take this approach, a few stations that you might start focusing your search around are:

  • Line 1 – Xinzha Rd (新闸路站)
  • Line 8 – Laoximen (老西门站)
  • Line 9 – Xiaonanmen (小南门站)
  • Line 9 – Madang Rd (马当路站)
  • Line 10 – Xintiandi (新天地站)
  • Line 10 – South Shaanxi Rd (陕西南路站)

Of courses there are many many places to choose from, but these are a few of the more centrally located places that still have very good subway access to nearby communities.

Rittenberg’s People’s Daily Article – April 8th 1967

Sidney Rittenberg came to China in 1944, after 2 years studying Chinese at Stanford. He lived in China from 1944 – 1949 (5 years) and was then imprisoned for 6 years (1949 – 1955). During the Cultural Revolution, Twelve years after his release (total of 23 years in China) he managed to take control of China Radio International (CRI), and publish the following article in the People’s Daily.

11 months after this article was published, Sidney was imprisoned again, from 1968 – 1977 (9 years). After his release in 1977, Sidney continued living in China for 3 more years (Total of 36 years, 16 in prison), and in March of 1980 he returned to the United States.

I’ve met few Chinese people who speak, read or write Chinese as well as Sidney – and it’s hard to imagine any other person not exposed to Chinese during their childhood attaining his level of fluency.

Bottom line, even after 6 years in China, I had to check my dictionary several times on reading through Sidney’s People’s Daily article: Chinese Cultural Revolution Opens Leadership Channel for Communism.


中国文化大革命打开了通向共产主义的航道

美国 李敦白 1967年04月08日

我到中国来的时候,根本不知道什么叫毛泽东思想。当时我对毛泽东思想 ,对中国共产党的路线、方针、政策都不了解,因为这些与美国共产党的一套 太不相同了。经过相当时间,我的脑子才转过来,认识到什么是真马列主义, 什么是假马列主义。我认识到中国共产党是真正的马克思列宁主义的革命党。

我对毛主席是非常尊敬的。我年青时候在一家纺织厂工作。我们工会开会 是在一个商店的楼上,是一间破破烂烂的房子,墙上只挂着一张相片,就是毛 主席。那时候,我已经知道有一个毛泽东,也知道毛泽东是中国的列宁。

我记得到延安以后,毛主席跟我谈过几次话。每次谈话的时间不长,但是 留下的印象很深。因为在每次谈话以后,我总是思考,毛主席为什么这么提, 为什么同我脑子里原来的想法不一样。解放战争时期,我就开始有这样的想法 :要解决美国革命问题,答案就在中国的土窑洞和土平房里。虽然美国的实际 情况与中国很不相同,但是我感到美国的革命,应该走毛泽东思想所指引的道 路。

去年六月,我又到了延安,同那里的一些老同志和青年座谈时讲到,以前 ,美共在南方的党,很小,但很坚强。南方党员入党搞革命,几乎每个人都挨 过打,坐过牢,受过压迫。组织从来没有瓦解,能坚持下去,有一定的发展。 三K党的迫害,没有能消灭它;政府的镇压,没有能消灭它;派进去的一些特 务的破坏,也没有能消灭它。但是后来党和它的群众组织一下子消灭了。这是 美共变成了修正主义以后,下命令要我们自己动手解散的。我到中国以后,每 当回想起这些,心里就很气愤。我们的党,不是帝国主义从外面把它压垮的, 而是敌人在我们内部培养修正主义,从内部把它搞垮的。那时我们不懂得反对 奴隶主义,不懂得如何区别资产阶级盲目的纪律和无产阶级自觉的纪律,也不 懂得造反,当然也就没有顶住这股修正主义的反革命逆流。怎样找一个防止党 内出修正主义的根本办法呢?我一直找不到一个明确的答案。在解放战争时期 和刚解放以后,我开始形成一个想法,就是要把毛泽东思想,要把马列主义真 理,与自己国家的革命实践相结合,这样,就可以防止出修正主义,就是出了 修正主义,也能够战胜它,打倒它。在当时可以说只是在理论上意识到了这个 问题。而在这次无产阶级文化大革命中,我对这个问题不仅在理论上,而且在 实践上又有了进一步的认识。

文化大革命使我感到了新生,年轻了二十岁。文化大革命为怎样防止和反 对修正主义找到了道路。我感到中国有这样的红卫兵小将,有这样在毛泽东思 想哺育下成长的革命青少年,世界革命的前途是完全可以放心的。中国的文化 大革命对世界革命是具有决定性意义的。

现在的世界局势,就是劳动人民和一切爱好自由的人民为一边,人类最凶 恶的敌人美帝国主义和各国反动派为一边,进行全球的阶级斗争,可以说,这 是一场全球性的阶级战争。美帝国主义要霸占全球,到处镇压革命运动。苏修 领导集团作为美帝的盟友,公开出来压制革命群众,出卖革命群众,替美帝国 主义效劳。中国无产阶级文化大革命,给了帝国主义、修正主义和各国反动派 以毁灭性的打击。

中国无产阶级文化大革命,进一步地把世界革命的领袖、世界革命的指导 思想、世界革命的中心这些问题突出地摆在全世界革命人民的面前。这样,全 世界的无产阶级革命派就有了明确的方向,这是革命成败的关键所在。中国无 产阶级文化大革命开辟了世界革命新的一页。

我觉得赫鲁晓夫修正主义对世界革命的一个严重打击,就是所谓反对个人 迷信。赫鲁晓夫的这个罪恶行动,对世界革命造成的损失是巨大的。如果不打 退这股反革命逆流,革命就不能前进,更不能胜利。否定无产阶级的革命领袖 ,实际上就肯定了资产阶级的领袖。美国黑人起来战斗,他们是很能看清这一 点的。我看到他们的一些油印小报,政治上很敏感,就是喊:“毛泽东!毛泽 东!毛泽东!”美国黑人处在美国社会的最下层,阶级觉悟最高,再加上民族 压迫,就更敏感。他们的出发点很简单,美帝是最凶恶的敌人,它最反对毛泽 东,那么毛泽东一定是最正确的。于是他们就拚命去找毛泽东的书,一看,就 感到很亲切,觉得就是给他们自己写的,给他们指出了道路。谁是他们的领袖 、他们的导师,他们心里非常明白。他们就是从毛泽东思想根本的一条出发: “凡是敌人反对的,我们就要拥护;凡是敌人拥护的,我们就要反对。”他们 从心底喊出:“毛泽东万岁!”北京的一位外国朋友到美国去,参加了一个辩 论会。辩论的问题是,毛主席是全世界革命人民心中最红最红的红太阳,这句 话怎么看?一个黑人青年站起来说:“你们在理论上辩论很多问题我不了解, 但是对我来讲,没有什么可辩的。在我心中,毛泽东就是最红最红的红太阳!”

毛主席是当代最伟大的马克思列宁主义者,是当代世界革命的伟大天才, 是当代革命最伟大的旗手。文化大革命充分证明,照毛主席指示去做,革命就 前进,离开了毛主席指示,革命就失败。对中国是这样,对全世界革命派也是 这样。毛主席天才地、创造性地、全面地继承、捍卫和发展了马克思列宁主义 ,把马克思列宁主义提高到一个崭新的阶段。毛泽东思想是在帝国主义走向全 面崩溃,社会主义走向全世界胜利的时代的马克思列宁主义。毛泽东思想是唯 一正确的指导革命、引向胜利的马列主义。

中国无产阶级文化大革命,在世界革命人民的心目中更加明确地解决了世 界革命的领袖、世界革命的指导思想、世界革命的中心等重大问题,这是对世 界革命的一个最根本的贡献。世界各国真正的无产阶级革命派,高举毛泽东思 想旗帜,高举毛主席是全世界革命领袖的旗帜,不顾反动派的种种迫害,大胆 前进。他们对毛泽东思想无限热爱,对本国的革命作出越来越大的贡献。

中国无产阶级文化大革命解决了当代无产阶级革命的一个极为重大的问题 ,就是在无产阶级夺取了政权以后,怎样防止资本主义复辟,怎样巩固和发展 无产阶级专政和社会主义制度以及怎样打开通向共产主义的道路的问题。这个 问题解决以后,就会使全世界革命运动打开新的局面,开始新的阶段,就是说 帝国主义要在全世界被打垮,社会主义、共产主义事业要在全世界取得胜利。 一八七一年巴黎公社有了无产阶级夺取政权的经验。一九一七年俄国十月 革命发展了这个经验。怎样巩固和发展政权,这方面过去有过的经验,只是抵 抗外部武装进攻和进行内部战争来维护政权。

但是,有一个问题没有解决,就是无产阶级掌握政权以后,如何不出修正 主义,如何不让资本主义复辟,如何把无产阶级政权发展下去,把革命进行到 底,怎样把已经胜利的社会主义国家继续发展下去,把无产阶级革命发展下去 ,成为世界革命的基地,保卫无产阶级革命,这个重大问题过去没有解决,这 次文化大革命才得到明确的解决。无产阶级在夺取政权以后,还要继续造资产 阶级的反,造修正主义的反,造一切剥削阶级意识形态的反,破资产阶级世界 观,用无产阶级世界观武装广大群众。无产阶级用武力夺取政权是普遍规律。 夺权以后,如何自下而上地发动广大人民群众开展无产阶级文化大革命,扫除 资产阶级思想,进行第二次夺权,这也是普遍规律,但以前根本不知道。现在 不但是在理论上已经知道,而且在实践上也有了经验。

夺取政权以后,必须继续夺头脑中资产阶级思想的权,否则旧世界不能破 得彻底,新世界创立不起来。

《修养》这本书危害很大。我自己受害之大,控诉几天几夜也说不完。《 修养》是大毒草,培养你当奴隶,如果你按着他的《修养》去做,不反抗,你 就能往上爬,万一犯了错误,遮遮掩掩,也能过去。这本书还提倡“吃小亏占 大便宜”,就是自己“修养”好,是为了个人有好处,对小集团有好处,这是 十足的资产阶级剥削思想。

《修养》是完全违反毛泽东思想的。毛主席提倡树立无产阶级世界观,树 立彻底为人民服务的思想,毫不利己,专门利人,用为人民服务的思想来考验 一个人在斗争中的表现。

过去我们都很信任苏联,看着克里姆林宫上面的红五角星,就觉得有了希 望。后来这个灯灭了。我们就想,中国革命有朝气,现在还在支持各国革命派 。但是有什么把握可以保证不变?亚洲、非洲、拉丁美洲同志,一到中国都提 出这个问题。一九六三年,毛主席发表了支持美国黑人斗争的声明,同时还接 待了我们两个美国人和十八个非洲国家的代表团。喀麦隆一个代表站起来说: “有一句话,我们不好意思讲,但是我们受武装斗争青年的委托,让我们问, 有什么把握证明中国今天支持我们,明天是不是还支持我们?”文化大革命清 楚地回答了这个问题。文化大革命使社会主义中国永葆革命青春,誓把革命进 行到底。通过文化大革命,现在可以得出这样一个结论:中国变不变的问题, 用不着担心了。经过阶级斗争风浪锻炼的广大中国革命青年和革命群众就是保 证,毛泽东思想就是保证。

中国革命进行到底,就一定会把世界革命进行到底。中国的无产阶级文化 大革命重新打开了被赫鲁晓夫修正主义阻塞的通向共产主义的航道。

中国无产阶级文化大革命的伟大胜利沉重地打击了帝国主义、现代修正主 义和各国反动派。“五敢”精神是把一切反动派都是纸老虎的思想,和战略上 藐视帝国主义、修正主义和一切反动派的思想贯彻到实际行动中去。知道了是 纸老虎,应该怎么办?就要有敢想、敢说、敢干、敢闯、敢革命的“五敢”精 神,中国的文化大革命做出了样板,英勇的红卫兵小将提供了榜样。在文化大 革命中,把“五敢”精神,革命造反有理的思想,提到了第一位。把革命造反 有理的思想交给各国革命派,这对促进世界革命将有巨大的意义。

中国的文化大革命也是对全世界无产阶级革命派政治上和各方面的支援。 这使帝修反非常害怕。《纽约时报》的一个叫杜尔敦的、研究中国问题的特务 记者,在文化大革命初期,就在报上写过一篇报道说,过去把希望寄托在毛泽 东的第二代,现在看来这第二代可能比第一代还要厉害。

中国的文化大革命提供了防修反修的战略和策略,是防修反修的大演习。 苏修领导集团非常了解这一点。他们拚命捣乱,特别是从上海的“一月革命” 开始,苏修豁出来了。柯西金到英国女王面前骂中国,骂中国的文化大革命, 竟然公开乞求帝国主义赏识他,援助他,一切面子都不要了。中国的文化大革 命激动了革命人民的心,也激动了苏联人民的心。中国的文化大革命把苏修的 老底揭露出来了。苏修怕得要死,于是大造谣言,他们胡说什么中国无产阶级 文化大革命不是无产阶级的,不是文化的,不革命的,甚至是反革命的。这简 直是胡说八道。苏修统治集团骂中国比帝国主义骂的还凶,因为它心虚得很。 它尤其怕打倒奴隶主义!怕打倒党内走资本主义道路的当权派和无产阶级革命 造反有理的响亮口号!中国人民在文化大革命中高举毛泽东思想伟大红旗,毛 主席成了世界革命人民心中的红太阳。苏修的日子越来越不好过了。修字号的 先生大叫大嚷说,文化大革命是别有用心的。这个用心是可以承认的,就是决 心在中国挖掉修正主义的根子。中国文化大革命增强了修正主义国家人民的斗 争勇气和信心。这些国家的人民一定会起来用适合他们需要的办法进行革命造 反。

为什么杜尔敦写这样的文章?为什么一谈越南问题,往往就联系到中国的 文化大革命?因为帝国主义的反动阶级本质引起它注意中国的文化大革命。文 化大革命堵住了帝修妄图在中国搞“和平演变”的道路,对美国的全球战略是 个沉重的打击,对各国人民革命斗争是有力的支援。中国无产阶级文化大革命 的伟大成就鼓舞着世界革命人民。成为世界革命基地的中国的日益强大,也大 大增强了世界革命人民的斗争信心。斯特朗同志现在的思想非常活跃,她说: “我这人已经八十一岁,但是还能干革命宣传工作,还能看许多东西,大概我 能看得到的中国革命、世界革命的事情,比我原来设想的可能多得多!我这个 八十一岁的老革命还是很有奔头!”我觉得她有这种感觉,外国的许多青年更 应该有这个感觉。

* * *

文化大革命以来,我在许多方面确实变了。我的思想变了,我的一些根深 蒂固的生活习惯,也开始变了。怎么变的?就是因为心中有红太阳。我学习了 毛泽东思想,我进一步认识到毛主席是伟大的革命领袖和伟大的导师,我就有 了一种新的力量。我深深地感到,一个人有了毛泽东思想,心里有了红太阳, 他就可以打破自己原来的思想,可以超脱原来的范围,成为大集体中十分有力 量的一员,发挥自己全部的光和热来参加革命事业。红卫兵小将们不是生来就 勇敢的,而是因为他们心里有了红太阳,所以勇敢。

毛主席不仅是中国人民心中的红太阳,也是全世界革命人民心中的红太阳 。全世界革命人民永远跟着红太阳,一定会把世界革命进行到底!

Chinese Income Gap – Problem?

If you spend any amount of time in any of China’s cities, it will not take long to notice that there are MANY WEALTHY PEOPLE and MORE POOR PEOPLE. China obviously has a massive population – so you get a chance to see more people in a short period of time that almost anywhere else.

Western strategists continually write about Rural vs Urban China, often writing about these in terms of Rich vs Poor China. Then they equate the current rural condition with Mao’s peasant led rebellion that founded the People’s Republic of China back in 1949.

For whatever reason, pundits are always looking at the LAST PROBLEM, and when they don’t have a deep understanding of the situation, pundits like to make analogies to Chinese history.

I have two contentions:

  1. WE FOCUS ON THE WRONG GAP: China does have a rich poor gap that must be improved – but it’s not the rural/urban or even the rich/poor gap. It’s the middle class/rich gap.
  2. CHINESE HISTORY ISN’T SPECIAL: China’s history is almost meaningless in trying to understand modern China. What’s happening on the ground today in China has as little in common with the Mao era as the Civil War does with modern America.

Today there was an article in StratFor (Strategic Forecasting) that focuses on the gap between China’s rich and poor. The article is titled: China Political Memo: A Growing Gap Between the People and the Elite.

A recent survey conducted at several top universities in China, including Peking University (PKU) and Tsinghua University, shows that the percentage of rural students enrolled at those institutions has dramatically declined over the past two decades. At PKU the percentage dropped from more than 30 percent in the 1990s to about 10 percent today. The numbers are similar at Tsinghua and other more selective Chinese universities. The most obvious reasons for this decline include China’s rapid rate of urbanization and the increasing number of job opportunities available to the rural population. Still, the decline is a worrisome sign that opportunities for China’s rural population to attain higher social status may be narrowing. The survey findings also reinforce an already evident trend: that social mobility in China is not as fluid as the country’s economic development might suggest.

Good. We’re focused on social mobility. Educational institutions are a big part of social mobility – especially access to the most elite institutions.

You can read the original China Daily article: Rural Students Deserve Better.

The rural Chinese population has been experiencing severe brain-drain for the last 30 years. In 1982, China was 20% urban, and only 26% urban by 1990. Today, China is over 50% urban. By 2035, it’s expected to be 70% urban.

Based on the numbers given in 1990 and today – the admission numbers should probably be closer to 15%. But that’s without factoring in the “brain drain” that has already happened in the country side. The smartest, the most ambitious, the most motivated have long since left this pre-industrial farming communities, and the ones that are born onto these farms try to get out as fast as possible.

So – it’s not a black and white issue – from an efficiency standpoint – to say that more farm students should be enrolled then are already being enrolled.

On the other hand, unrelated changes such as improving the legal system, tax system, and real estate market would probably do more to strengthen the country. How much does the unreliable legal system do to keep people from working with those outside of their network?

In any society, even an ideal one, social stratification is inevitable. But for a modern society to prosper and grow it must minimize barriers to economic advancement. Otherwise, gaps will widen among the social strata, creating potential resentment and instability at the lower levels. In China, the traditional path to a better life was the imperial examination system (ke ju), which began in the 7th century during the Sui dynasty and was open to anyone who demonstrated sufficient intelligence and drive, regardless of social status. Ke ju selected the most promising administrators for the state bureaucracy. As such, it served for centuries as a portal through which smart and hard-working youth could become part of China’s political class. This transformation could greatly change the life not only of the individual aspirant, but also his entire family. Cancellation of the imperial examination system in 1905, during the Qing dynasty, cut off this mode of access. In the 1950s, the division between the people and the ruling elite was reinforced with the introduction of the hukou system, a resident-identification program that created an official division between rural and urban dwellers.

This is a typical example of bias #2 – Chinese History isn’t special. What does the “imperial examination system” have to do with modern China? The exams could be taken by male adults, and the last exam was given in 1905 – meaning that the test taker had to be born before 1890. The imperial exams were a test. “Gaokao” was a test. The SAT is also a test. Why would we assume that “Gaokao” has more connection to the imperial exams than it does to the SAT?

The biggest beneficiaries of the system have been urban dwellers, who have greater access to employment, social welfare, education, medical care and housing than their rural counterparts. Despite years of campaigning by the state for hukou reform and a more equitable distribution of benefits, little has been achieved. If anything the disparity seems to be widening, which makes the findings of the recent university survey all the more troubling.

Of course the industrialized (ie. urban dwellers) are the beneficiaries of modern China – because they are more productive in the urban environment. Their farming jobs are easily replaced with the capital equipment used on American farms – equipment that allows 1% of Americans to work in agriculture.

One of the few portals left for upwardly mobile youth in China is the college entrance examinations (known as gao kao). The gao kao system is intensely competitive, allowing qualified applicants regardless of pedigree an opportunity to enter a university (usually in an urban area), earn a degree and find a well-paying job. While the system falls short in many ways — stipulating, for example, lower quotas for rural applicants than their urban counterparts and thereby further widening the gap — it remains the most efficient path toward the elite class, both politically and economically. And this, much like the imperial examinations once did, helps to anchor stability and, to some extent, secures the power of the elite class. While an expanding educational system was once seen as a great leveler of modern China, a growing imbalance in the distribution of resources between the country’s rising middle class and their less privileged rural counterparts is making it harder for rural youth to move upward. College tuition and fees are becoming less affordable. Many of the top universities choose students based on their acquired specialties — for example, music or technology — which wealthy students are better able to develop. This hurts rural students, who are more likely to have attained high scores through hard work. Meanwhile, many selections are based on personal networks, which further impedes poor students. The result is a narrowing of options for rural youth, the brightest of whom may not have enough money or the right connections to get into the top schools. Barriers are also being raised by the increasingly close connections between China’s political elite and business elite, both urban based. As it becomes harder for China’s rural population to break through these barriers, it could lead to growing grievances over inequality and intensifying social unrest — Beijing’s greatest fear. Therefore, Beijing may need to work to increase access, creating opportunities for the country’s massive rural population.

Yes, it’s sad anytime someone is under-utilized. In 1982, 75% of Mainland Chinese were subsistence farmers. Today it’s less than 50%. Seems reasonable to believe that the 50% that are still subsistence farmers are probably not much better off than they were in 1982 – because they are no more productive than they were in 1982. However, if they want, then can go get a job in an urban area. They can work in the factory, and their kids can get a shot at really integrating into that urban area. Unless the government makes a mess of inflation – there was 100% inflation leading up to the 1989/6/4 incident – the farmers will be fine. They know their future awaits them in the city when their time comes. If not them personally, their children or grandchildren.

The bigger problem is that the wealthy/elite are very entrenched, and getting more entrenched by the second. The far more interesting survey for Tsinghua and PKU would be: what is your parents net worth? or what bureaucracy do your parents run?Knowing how relationships and favors work throughout China, I would be very pleasantly surprised if these numbers were anything like a representative (meritocratic) representation of urban China.

The Chinese Middle class has average incomes around $10,000 USD/year. Meanwhile, China has more than 1.11 MILLION households with net worth over $1,000,000 USD. Houses in most urban areas of China can not be purchased by the “middle class” with the current middle class income:home price ratio.

It’s not the barrier between the poor and the middle class that China needs to worry about – this is a barrier that the motivated can easily overcome. It’s the barrier between middle class and wealthy that they need to worry about — because the smart, ambitious, but frustrated — those are the ones you’ve got to worry about.

The Economist for Free? Only in the Workers’ Paradise

Yesterday a friend of mine was telling me about a chinese website where the economist was translated each week by an army of Chinese volunteers. One of them subscribes to the magazine, and then the rest of them translate and put the translation online for free:

Screenshot of the Ecocn.org website homepage

关于我们 ECO中文网创建于2006年,是《经济学人》爱好者的家园,凝聚了世界各地的华人力量翻译每期《经济学人》的精彩文章。《经济学人》最早于1843年9月由詹姆士·威尔逊创办,以独立和全球化的视角著称。创办的目的是“参与一场推动前进的智慧与阻碍我们进步的胆怯无知之间的较量”。

Translation:

About Us: The “ECO” Chinese language website was established in 2006, it is <The Economist> magazine’s hobbyists homeland, made up through the power of Chinese people all over the world translating every issue of The Economist’s brilliant articles. The Economist was founded in September 1843 by James Wilson, and has stood alone with it’s pro globalization prospective. The economist was founded to take part in “a severe contest between intelligence, which presses forward, and an unworthy, timid ignorance obstructing our progress”.

Kind of funny to watch the Chinese Black Market “economically” handling distribution for The Economist. See it for yourself: www.ecocn.org.

The Fed: Enron’s “Raptors” for Government Finance

The Federal Reserve Balance sheet is to the Federal Government what Fastow’s Loss Hiding “Raptors” were to Enron Corporation.

The Federal Government has a debt of at least $14.7 Trillion. Additionally, the Federal Reserve has a debt of at least $2.5 Trillion.

According to Dean BakerCenter for Economic and Policy Research:

There is a simple way to avoid a sharp rise in the interest burden associated with a higher debt. The Federal Reserve Board can buy and hold the debt that is currently being issued by the Treasury to finance the deficit. The logic of this is straightforward. If the Fed holds the debt, then the interest on the debt is paid to the Fed. The Fed then returns the interest to the Treasury each year, meaning the net cost to the government is zero.

This technique is known as monetizing the debt.

In August, 2010 the FOMC (Federal Open Markets Committee) actually stated they would begin monetizing the debt with this anouncement:

“To help support the economic recovery in a context of price stability, the Committee will keep constant the Federal Reserve’s holdings of securities at their current level by reinvesting principal payments from agency debt and agency mortgage-backed securities in longer-term Treasury securities. The Committee will continue to roll over the Federal Reserve’s holdings of Treasury securities as they mature.”

Fed Gov’t Debt ($17.7T) + Fed Reserve Debt ($2.5T) = $20T. Debt is already over 140% of GDP.

The important lesson here, is that the Federal Reserve Balance Sheet can continue to absorb an infinite amount of Federal Gov’t debt, for Zero fee.

So, about Enron.

Enron created off balance sheet limited partnerships, these were named LJM1, LJM2 and Raptor I, I, III and IV. When Enron didn’t have enough money, it would borrow money from these off balance sheet partnerships. When it lost money, it could hide those losses in these partnerships.

Sound familiar?

The Federal Government doesn’t have enough money. Nobody wants to buy Treasuries to lend it more? No need to raise interest rates – just let the Federal Reserve hold the Federal Debt on it’s balance sheet, and since profits of the Federal Reserve are paid to the Federal Government, nothing is really owed, so we can keep this cycle up indefinitely.

Until the music stops.

The more junk stored on the Federal Reserve balance sheet, the less likely anyone outside of the Federal Reserve will buy treasuries – yet each time the Fed buys, it intrinsically expands the dollar supply and thereby devalues the dollar.

The Chinese Central Bank is determined to store overpay for large piles of US treasuries, and the US Central Bank is also determined to overpay for large piles of US treasuries, and other Toxic assets.

Future borrowing needs to move from easily devalued national currencies to a more difficult to devalue trans-national standard. I mentioned Special Drawing Rights two years ago, and they were really a pretty novel solution to the US debt problem at the time. Once the Chinese and Japanese central bankers come to their senses, if the Treasury wants to sell debt to anyone besides it’s Enron style Special Purpose Entity (the Fed), then it’s going to have to denominate debt in something more stable.

Emerging Market Myths

Interesting SeekingAlpha article pointing out credit expansion as an often overlooked factor in developing market growth, and that when credit expansion stops, developing markets may stop developing.

It is almost taken for granted that many emerging markets will continue to experience higher growth rates than more established countries including the United States, the U.K., and most of the countries in Western Europe. However, it is usually assumed to be the result of a superior educational system, a more coherent set of cultural values, high population growth, vast natural resources, and numerous other factors–all of which are almost completely irrelevant to the issue of economic vibrancy. Let’s focus on the single most important feature of emerging markets, which is the availability of credit. Developed markets have enjoyed relatively easy and plentiful access to credit in numerous forms for decades or longer–mortgages, credit cards, auto loans, installment payments, low money down payments, government-guaranteed borrowing, and numerous related institutions. In sharp contrast, much of the rest of the world was on a cash-only basis until just twenty or thirty years ago (or even less, in some ‘frontier’ countries including Colombia, Mongolia, and Uganda). If you live in an all-cash economy which suddenly begins to use credit, there will be an immediate surge in spending–and which will create a domino expansionary effect. When someone borrows money, that money quickly finds its way into the real economy. Over time, as that loan has to be repaid, this will have a gradual drag on the economy over a period of several years or more. However, the immediate impact is invariably positive. In any nation where most of the GDP growth is caused through the expansion of local businesses, as in China and India, the fact that many millions of people will suddenly have access to credit will almost certainly create double-digit increases in annual revenue for many sectors of the economy. This higher rate of growth can only continue as long as credit continues to become more readily available to an ever-increasing segment of the total population. Eventually, as in the developed world, a point of saturation begins to be approached. There are still those who do not have access to credit, but they will eventually consist primarily of those who are not creditworthy due to their limited personal circumstances, or the minority of those who simply refuse to borrow money under any circumstances. Once this saturation point is reached, further credit expansion slows dramatically. This has the immediate effect of causing lower rates of economic growth. In the longer run, the reality of widespread loans having to be repaid will have an even more negative effect on the economy, especially during times of recession when assets become less valuable, while loans are not diminished in magnitude. In relative terms, then, the loan-to-asset ratio of much of the population will dangerously increase.

The author makes a good point, especially scary if you consider many emerging markets drastically (100%!) under report their public debt numbers, but credit expansion isn’t the only reason for growth in Asia. The more important, and more real story is productivity growth.

China has a good educational system, stable government, and talented, hard working citizens. No reason Chinese labor should be priced at 20% of USA labor, especially when Chinese blue collar labor is MORE PRODUCTIVE than US blue collar labor in many situations (environmental regulations, employee obedience).

Real-estate prices in China are already adjusted for 10-20 years from now when those prices hit parity, but still many medium/long businesses opportunities selling to the chinese consumer, particularly: Agriculture, Finance, Retail, Medicine, Health & Fitness.

New Age terrorists develop homeopathic bomb | NewsBiscuit

New Age terrorists develop homeopathic bomb | NewsBiscuit: “The world has been placed on a heightened security alert following reports that New Age terrorists have harnessed the power of homeopathy for evil. ‘Homeopathic weapons represent a major threat to world peace,’ said President Barack Obama, ‘they might not cause any actual damage but the placebo effect could be quite devastating.’ The H2O-bomb has been developed by the radical New Age group, The Axis of Aquarius. In a taped message to the world, their leader, Professor Hubert Pennington, said: ‘For too long the New Age movement has been dismissed as a bunch of beardy weirdy cranks and charlatans. But now we have weapons-grade homeopathy and we demand to be taken seriously.’ Homeopathic bombs are comprised of 99.9% water but contain the merest trace element of explosive. The solution is then repeatedly diluted so as to leave only the memory of the explosive in the water molecules. According to the laws of homeopathy, the more that the water is diluted, the more powerful the bomb becomes. ‘It was only a matter of time before these people got hold of the material that they needed to make these bombs,’ said former UN weapons inspector, Hans Blix, ‘The world is a much more dangerous place with the advent of these Weapons of Mass Dilution.’ ‘A homeopathic attack could bring entire cities to a standstill,’ said BBC Security Correspondent, Frank Gardner, ‘Large numbers of people could easily become convinced that they have been killed and hospitals would be unable to cope with the massive influx of the ‘walking suggestible’.’ The severity of the situation has already resulted in the New Age terror threat level being raised from ‘lilac’ to the more worrisome ‘purple’ aura. Meanwhile, new security measures at airports require that all water bottles be scanned to ensure that they are not being used to smuggle the memory of an explosion on board a plane. ‘Homeopathic weapons are the ultimate Smart Bombs,’ warned President Obama, ‘They are so smart that they only affect the gullible. The only defence is for everyone to remain calm, vigilant and to always wear a magic vibrating crystal.’”

(Via .)