This is a story about the wanker of the wharf...

London's financial services sector is the gift that keeps on giving. Through Y2K, the dot com bubble bursting, 9/11, 7/7 and the credit crunch, the good times never stopped rolling.

I'm now experiencing deja vu. My very first contract in Docklands was at Harbour Exchange, working for Lloyds TSB. I wore a shirt with cufflinks shaped like taps. I thought I epitomised the height of business fashion. In my defence, I was only 20 years old.

As I look around the glimmering tower blocks on the wharf, and look at their revolving doors leading into their fancy foyers, I realise that I've done at least two tours with so many of the companies: HSBC, JPMorgan, Barclays, Lloyds and others too.

It's good that these places will have me back. Why wouldn't they? I left on good terms, with great references and a bunch of people who'd remember me and some of the things I did when I was there.

But, I've started to burn bridges.

I know how to play the game and keep my mouth shut; not rock the boat. I know that the whole banking world keeps you hostage with golden handcuffs. You're ridiculously well paid, so you try to silence the voices in your head that say: what we're doing here is just not ethical.

You can immerse yourself in the propaganda, that says that the financial products that we offer are greasing the wheels of commerce, but you know that deep down, most of what you're doing is helping the rich to hide their wealth and shield it from taxation. When you ask your customer what their source of wealth is, they're not exactly going to say that it's sweatshops and drugs, are they? They're not exactly going to confess that their family is wealthy because they embezzled a load of money, leaving their fellow citizens starving.

Even a close friend, who seems reasonably ethical banker, has helped his father - a judge - to hide the family wealth in an offshore trust. They had some problems proving that they controlled the money, in order to get a mortgage, but the bank was eventually satisfied. The people who work in banks are outsmarting the ones who work for the regulators and the taxman, so that's why the rich pay very little tax, while the poor shoulder the burden of social programs. Socialism for the rich and capitalism for the poor.

Am I a hypocrite? Am I ungrateful, when I bite the hand that feeds me? Well, the easy defence is just to say that if I didn't do my job, somebody else would. Isn't it better that I'm on the inside, trying to make things better, than on the outside where I would have very little power and influence. I could easily throw my clogs into the loom, if I thought that was the right thing to do.

Fintech is a conflation of financial and technology. Fintech tends to mean the challenger banks and ecosystem that exists outside of the long-standing institutions. Arguably, I've been working on Fintech - financial services technology - since 1998, but yet I might get mocked by my startup buddies as working for dinosaurs. Indeed, one well-respected friend from the venture capital world, even wrote a blog post which suggested that my return to Canary Wharf was an admission of defeat; a failure.

I do feel like a failure. Even though I just secured yet another contract for yet another massive bank, doing some cool stuff with AI and other bleeding-edge tech, and I'm going to be exceedingly well remunerated, I still feel like I sold out. I'm also really worried about my chequered past catching up with me. Instead of popping a champagne cork in celebration of my new role, last night, instead I have butterflies in my tummy and I'm incredibly anxious about getting everything signed, starting the job and making a good first impression, without any hiccups.

My self-assured manner and my self-confidence has all been destroyed, replaced instead with self-doubt. I started looking for a new contract on the 30th of November, and it took all this time to get one. I take that pretty personally, and I worry that I'm not a competitive candidate anymore: I'm not making the grade, amongst the other contractors in the market.

Obviously, when I actually start working these contracts, I realise that there's a real lack of tech pedigree and good leadership. I realise that there is a need for my skills and experience, and I can add value.

However, I struggle to play the game anymore. I struggle to keep my mouth shut for the benefit of my career and my bank balance. I struggle to let things go, for my own personal benefit. When I see wrongdoing and incompetence, I feel that I have a responsibility to the general public, to not just turn a blind eye. I feel like I have to act ethically... not because the regulators are watching, but because it's the right thing to do.

I struggle to do the work anymore. I don't enjoy tech for tech's sake. Often times I don't really believe that tech is improving anything. Most projects are doing the same kinds of things that have been done time and time again, for years. You'd have thought that if we were solving real problems, we'd have solved them already and moved on to something more useful, like finding a cure for cancer. The banking problem - debit account A and credit account B - is not a hard one to solve.

Who the hell am I, to sit idle for the whole month of November, writing a novel instead of trying to get a job. Who am I to arrogantly assume that I'll be able to win another lucrative contract, instead of getting a regular job like everybody else does? Who am I to only work 4 or 5 months of the year? Who the hell do I think I am?

Well, you're welcome to hate me if you like. I'm a banker; a capitalist pig; a lickspittle of the wealthy elites who cause so much human misery.

However, I'm an ideological misfit. I know that I'm well remunerated, but I don't confuse that with value. I don't feel valuable, I feel like I'm wasting my time building stuff that doesn't help; it hinders. I feel bribed into doing a job, because I need the money. Aren't we all? Yes, so why work a job that's just as pointless, but get paid a lot less? Do you think that by depriving that massive corporation of yourself, you're hurting them?

Arguably, if we were to all take an ethical stance with our employment, and refuse to work for weapons manufacturers and banks, we would starve them of the manpower they need to function. However, humanity responds to incentives: if you couldn't buy guns, somebody would start sharpening pointy sticks and selling them; if you couldn't get a bank loan, loan sharks would lend money.

The problem is when you follow a set of rules to their ultimate conclusion, you get some undesirable outcomes. Free-market capitalism might work when you're conquering the Wild West and building all the critical infrastructure to colonise the New World, but what about when it's all done, and populations start exploding? Is it right that being born into wealth or poverty is not a choice: inherited wealth and ownership determine everything.

If we pressed the 'reset' button and set all the bank balances to be the same, how many would lose and how many would gain? Yes, it's unfair that some who've worked very hard would lose out, but what about those who think it's unfair that their inherited wealth shouldn't be subjected to a Robin Hood tax? Surely it's more unfair that some people have a lifelong trust fund income, while others have to flip burgers and still can't afford to raise their families. Surely, there are more people who would benefit, than lose.

So, eventually I arrive at the conclusion that we need to have debt forgiveness, or else civilisation will be destroyed. I mean, what are the wealthy even doing with all their ill-gotten gains? It's dog in a manger behaviour that's the problem here, not jealousy.

In the rigged system we've built, success is not about hard work. The fable of the girl who swept the factory floor being promoted up the career ladder until she was eventually the CEO, is total horse-shit. We know that all the best jobs go to wealthy men from a handful of powerful families. You could bust your ass your whole life, and still have nothing to show for it except the little plastic stars on your McDonalds name badge.

To say "twas ever thus" and blame human nature, is disingenuous. You don't have to look very hard to see that civilisations rise and fall, based on the satisfaction of the hoi polloi. It doesn't matter how high you build the walls: when enough people want to smash down your defences, you'll find that even the most robust barriers are too flimsy to protect you.

What do we really believe in? What cause are we fighting for?

The top echelons of society are wealthy enough to have their every whim catered for, but what do they believe in? How many of our rulers are passionately engaged in the pursuit of something more meaningful than money?

I wanted to save up and buy a house. I wanted luxury holidays and fine dining. I had become totally bourgeois.

If we leave noble causes - like the search for scientific knowledge, world peace and hunger - to a handful of charity workers, while we ourselves fret about buying a bigger house or another boat, then our most educated and powerful portion of society is consumed by the consumer economy, which is intent only on separating fools from their money.

Western civilisation will fall, as if knocked over by a feather, because we believe in nothing.

Tags: #politics #capitalism #career #banking

This is a story about the precariat...

Here I am, in psychiatric hospital with underpants on my head and pencils up my nose. I think you will agree that this makes me perfectly qualified to run the country.

Having a manifesto is something that we associate with nutters who commit mass murder. The end justifies the means, in the minds of people consumed by their political ideologies.

Admitting to having political ambitions is laughable for an ordinary British citizen. The route into politics is through namedropping, brown-nosing and suffering the bullying & infighting of the dominant political parties, as you rise through the ranks. Going into politics is not about campaigning on a manifesto which comprises your deeply held political beliefs. Going into politics is not about a commoner being elected to the House of Commons. There's no room for the riff raff in politics and you're going to need wealthy donors to back you. You'd have to be stark raving mad to think you could get into politics as a representative of the constituents in your local area.

Politics is a career; it's not about improving the lives of your fellow citizens. There's no room for anybody who hasn't made politics their specialism. An interest in government is a fetish for three-line whips.

Political office is granted in recognition of a complete lack of empathy for the proles that a prospective MP has spent their whole life exploiting. Our ministers should be selected from a pool of wealthy elites, who have no concept of life without a trust fund and the advantages of nepotism. The benches of parliament should reflect the people who helped win those seats: the wealthy donors.

Pretending that political parties are given an equal campaigning platform, and that we don't have a two party system, is a hilarious prank that's being played on the electorate. Who could possibly compete with the big two parties, who hoover up so much political donation money? If you're looking to buy yourself a peerage, are you going to waste your hard-earned cash on a party that stands no chance of winning a majority? What a joke!

The top three manifesto promises of the Tories are: plutocracy, plutocracy and plutocracy. Crush the proles. Smash their unions. Keep them insecure and divided. Oh, what a glorious thing, to see the landed gentry literally lording it over the riff raff.

Posh little girls and posh little boys grow up dreaming about the day when they'll get to destroy the welfare state and lower the living standards of ordinary people. "On yer bike!" the jumped up little twits shouted when they were youngsters, and now they're ushering in the Britain they always wanted: where the only fucking job you can get is being a Deliveroo takeaway food bicycle delivery rider.

We don't want anybody getting into politics, who has any idea what life's like for the vast majority of British citizens. We need people who live and breathe the Westminster bubble, to think about real issues, like where they're going skiing this year with their barrister chums.

- ALTERNATIVELY -

I know what it's like to claim benefits, be homeless, suffer mental illness and have to navigate an under-funded National Health Service. I know how digital transformation will affect every aspect of the world around us, and I've worked in education, retail, defence, financial services, security, transport, housing & construction and a host of other sectors too. 

I've studied the dismal science - economics - as well as starting several profitable businesses. I have in-depth knowledge of almost every tax we have: from income tax to capital gains tax; from Value-Added Tax (VAT) to corporation tax; from import duties to stamp duty. I understand trade deficits, fractional reserve banking, financial instruments and the national debt.

With a background in science and technology, I have a big-picture view that broadly encompasses every aspect of modern life. This is not stuff I've read about and only understand theoretically: I'm a practitioner and I have real-world hands-on experience. I have a worldview that starts in the subatomic realm of particle physics and finishes in the intergalactic universe of cosmology, with a geopolitical overview of terrestrial matters somewhere in-between those two extremes.

I'm not a specialist. I have no desire to study the minutiae of anything, like a stamp collector or a train spotter would, but instead I've gathered knowledge of how all the different component parts fit together. It's no co-incidence that I've been able to write game of life type software simulations: computer models.

Anybody involved in politics would benefit from being a generalist not a specialist. When all you've got is a hammer, everything looks like a nail. It's impossible to reconcile the competing views of thousands of specialists, because they all have a very narrow worldview. It's all very well being an expert in your field, but where's the balance?

If I was going to pick a bunch of people to run the country, they would be the fiction writers and the computer game designers. Without an enticing vision of the future, reactionary forces will drag us back into the dark ages. Without a working virtual world, how are you ever going to test your ideas, without your mistakes inflicting untold misery on real people?

As a prerequisite for becoming a minister, you should be able to build a thriving happy metropolis in Sim City and complete a game of Civilization through cultural influence, not war. If you're a failure in those virtual worlds how can you think you're even remotely qualified to wreak havoc on the lives of the electorate? We wouldn't turn you loose on the roads without a driving license.

All minsters and their children should attend state school and be treated by the National Health Service: you've gotta eat your own dog food. There should be a means test, that excludes wealthy families, trust fund babies and any nepotism: only a single generation of any family may enter into politics.

In fact, some of those who govern should be selected randomly, like jury service. Wanting to exercise any kind of power over your peers should be an automatic disqualification. The House of Commons should be balanced out with ordinary people, who have no interest in politics per se: it's the civic duty of every British citizen to muzzle the dangerous megalomaniacs.

Housing, transport, education, healthcare and a host of other essential services, are public services and as such, they should never be profitable. The state should have a monopoly on the things our citizens need. To allow a private firm to profit from our population's needs is a crime. The private sector is welcome to compete in the world of wants, but not needs. Simple economic theory will tell you that prices have upwardly inflationary pressure on things that you have to have: are you going to skip getting cured of that deadly disease, because it's too expensive?

Do you want to live in a world of zero-hours contract McJobs, insane house prices, stress, long hours, insecurity and indentured servitude, for the benefit of big business? That's what you're getting when you allow the country to be run by commercial interests.

We need to smash the plutocracy. We need to have dignity in labour. We need to be united, not divided by those who tell us that we're easily replaced and make us crawl over broken glass for a few mouldy crumbs. Inequality and the arrogance of the elites has reached unsustainable levels. We can't afford the rich any more.

If you think these are just the immature words of a bleeding-heart liberal who never grew up, and I don't understand the complexities of the world, I think you're being a mouthpiece of the elites when you say that it's not as simple as just dividing the wealth. It's easy to be an intellectual snob, because you believe you're destined for greatness. Just because it's not you, going with your cap in your hand to the mill owner to ask for a bowl of gruel, you could easily fall from grace at any moment. Just because you can't imagine what it's like to be poor and struggling, doesn't mean that it couldn't happen to the likes of you. Your fancy education and your expertise won't save you, when the working classes rise in anger and strike down the bourgeois rentier parasite class.

The irony of me writing this, while sipping champagne and looking out over the River Thames and the London skyline, from the balcony of my luxurious home, is not lost on me. The working-class heroes and self-made millionaires can be some of the most awful people. There's absolutely nothing humbling about rising up through the ranks and being successful; quite the opposite in fact.

I write as somebody who's been incredibly fortunate - getting propelled into a life of privilege and wealth - only to lose it all and have to rebuild from scratch. I write as somebody who knows that there's a fast track, as well as how hard it is to overcome prejudice and adversity. I write as somebody who can have delusions of grandeur as much as a sense of worthlessness. I know I'm flawed and I know I can fail, as much as I know how to succeed.

Worshipping power and status has led to layers of sycophantic courtiers, each one existing only to polish the egos of old men. Do you really want your whole country run, just so some exploitative megalomaniacs can be called Sir or Lord? Do you really think anybody deserves your respect, when they preside over the destruction of living standards in an epidemic of mental health issues, caused by the stressful modern life they created?

A central tenet of my desire for political influence, is my first-hand experience of depression, misery, exhaustion, stress and anxiety, which is an intolerable situation, created unnecessarily by unrestricted free-market capitalism. Are these the pillars that you want our working world built on? Should British citizens suffer as much as they do, just to have a crust of bread, a roof over their head and the hope of one day being able to pass on the suffering to the next generation? My answer is: no.

I don't necessarily believe that the state should own the means of production, but the workers should benefit most from the fruits of their labour. Wealth needs to be distributed, not concentrated in a few idle hands. Trickle down economics is a terrible lie.

I think that without social reform, eventually people will put down their tools and violently protest at their exploitation.

Obviously, I'm just a maniac up on my soapbox, shouting absolute nonsense, but who do you believe more: the wealthy elitist who tells you that everything's fine, or the person who's suffering at the hands of those elites?

Tags: #politics

This is a story about inevitable disappointment...

Oh no! Bad news!

Time to press the FUCK IT button and self destruct. I just can't take shit like this any longer. Life is one long string of let-downs and anticlimaxes. Life is like being fucked up the arse with a red hot poker, until the day you die.

But, isn't this what separates the winners from the losers: how do you handle the bumps in the road? Do you fall to pieces, or do you pick yourself up, dust yourself off and get back on the horse?

How much can you take before you inevitably conclude that the world's got it in for you? A life of happiness and contentment just aren't on the cards. You're consigned to your fate, which is misery, failure and then death.

You could try to be philosophical and look for a silver lining in every cloud. Maybe the reason why you didn't get that job was because it wasn't meant to be: there's a better job waiting for you just around the corner. Maybe the reason why those shitty things happened was to toughen you up for the challenges ahead.

You could try to be pragmatic; realistic. Give up and get a cat, because you're going to be single and unemployed forever. Nobody wants you. The world's trying to send you a message and that message is crystal clear: fuck off and die.

We seem determined to build an adversarial zero-sum world, where our lives are dominated by stress and rejection. Instead of cooperating, collaborating and sharing, we want to have winners and losers. Instead of everybody having what they need, we want to create a world of haves and have-nots.

I read something the other day suggesting that participation medals for coming last place in a running race were a terrible idea, because they made victory taste less sweet. Supposedly, we'll be less hungry to dominate our peers if we start doing away with the spirit of competition. Yes. Yes, that's the point.

"That's loser talk" I hear you say.

Yes, if you think you're pretty great at something, you can get a bit carried away, can't you?

Remember: there can only be one ultimate winner, in a competitive world.

Taken to its ultimate conclusion, there'll be one person who has all the money, all the sexual partners, all the power. There'll be one person who's the best at sport, music, art, acting, writing, science, adding up numbers, memorising facts, spelling. Anything that you think you're good at and you enjoy... you'll find out you're inferior. Trust me, you're not going to like it.

You might think you're a big fish in your small pond, but remember there are 7 billion people crawling all over the surface of the planet, trying to fuck each other over. Your delusions of grandeur will be shattered and you'll find out that you were simply being used by powerful people, to further their ambitions.

You might think that competition is natural. You might think that survival of the fittest means that humans are evolved to fuck each other over, but in actual fact the success of our species is cooperation not competition.

We have baked adversarial practices into our society. We have the government and the opposition in politics. We have the prosecution and the defence in law. We have legal and illegal; right and wrong; black and white. We have native and immigrant; us and them. We pay our sports stars obscene amounts of money and we have football hooliganism in support of our favourite team.

This is a mistake.

The competition is with nature, not with each other. A hurricane will flatten our houses, so we should cooperate to build stronger buildings. A drought will leave us all thirsty, so we should cooperate to dig a well. Crop failures will leave us all starving, so we should cooperate to store our grain. Lions and tigers will eat us, so we should cooperate to warn each other of approaching danger.

So far as I can see, all the misery and suffering in the world is a man-made problem, because we refuse to rein in the horrible power-hungry and greedy aspects of humanity. Why do we celebrate celebrity, wealth and status? Instead, we should punish and shun the freakishly vain and selfish people, who consume and hoard more than their fair share. Democracy has been perverted to serve the interests of a few rich people, instead of the masses who toil in the factories, fields and build the houses.

If you ever wonder why bad shit happens to you and why life is such a struggle, the answer is fairly easy. In an adversarial competitive system, everybody has to suffer so that one person can be the 'winner'.

I'm now playing a waiting game. I'm clinging on with my fingernails, just waiting for the whole house of cards to collapse and the proletariat to rise up and strike down their cruel masters. Humanity has been enslaved by capitalism for too long. It doesn't work for 99% of humanity, and that's fucked up.

Tags: #politics #capitalism

This is a story about referees...

Here's me travelling to work by boat during the tube strike. But why do you even have to go to work anyway? Why do we need the fancy towers of glass, steel and concrete? Why do we need to move millions of people away from their homes and into the cities every day? Why do we need to inflict untold agony on a huge proportion of humanity, just so we can keep some office chairs warm?

Imagine the global economy to be a game of football: the defenders are the police, army and healthcare professionals; the midfielders are the builders, farmers and fishermen; the attackers are the engineers and scientists. So, who's the referee?

The banks are the referee: they're the ones keeping score.

Banks are simply supposed to keep a tally - a balance - of who's winning the game. That's it. Nothing more, nothing less. You can play football without a referee, but it's supposed to be a fairer game if you have somebody impartial to be in charge of the match, running it according to the rules and without cheating.

Why the hell would over 80% of our economy be given to the people keeping score?

If you think about it, most of what goes on at head office is administration. Administration never put food on the table or a roof over anybody's head. Administration is an unnecessary overhead, not a business in its own right.

For sure, administration is hard and complex, but that doesn't mean it's valuable. Just because you've been to business school and got your Masters in Business Administration (MBA) doesn't mean you know fuck all about building a profitable business that adds value to humanity. In fact, you probably got a bit confused and you started to think that administration is the same as business.

If you don't pay your taxes, the government will shut you down. If you don't follow the trading laws, your business is going to get big fines and may be forced to cease trading. However, following the regulations isn't actually the same as running a business.

It's easy to believe that because your business is well administered, your book-keeping is well done and your taxes are all paid, that you're doing a great job. In fact, that's utter horse-shit. What does your business actually do?

So much money is wasted building fancy head offices and filling them full of administrative drones. One office block I worked in actually had a worm farm in the basement in order to eat all the useless paper that was generated by the bean counters.

Do we really need all these people doing bullshit jobs? Do we really need all these records and processes? Is it really helping humanity? Is it making anybody happier?

Today, London was paralysed by a tube strike, but what's the fucking point of those miserable journeys into the office anyway? What got done today? What wouldn't get done if nobody turned up? Would the world end? Would people go hungry or not have a place to live?

"But what about money? What about mortgages?"

Fuck those things.

There are plenty of resources. There's plenty of land to build houses and grow food. There are plenty of rivers and reservoirs. There's plenty of wind and solar energy to be harvested. Fuck sitting at a desk shuffling paper around. Fuck kowtowing to some bean counters.

You've been mortgaged. The reason why you have to do a pointless bullshit job that adds no value to humanity, is because the natural world is being destroyed to create more phallic towers of concrete, full of administrative drones, to add some more fucking zeros onto the digital bank balance of a small-penised oligarch. Does that sound like a useful endeavour to you? Is that how you want to say you spent your life?

It maddens me that we have to get up early in the morning in the middle of winter and struggle to get to 'work' on overcrowded commuter trains, because our bullshit economy worships the referees; the bean counters. The banks are supposed to grease the wheels of commerce, not hoover up all the fucking wealth.

It disgusts me that the lawyers, accountants, bankers and other financial service leeches are wallowing in cash, doing precisely fuck all of any value, and mandating that humanity has to commute across the country twice a day in order to shuffle paper around a desk and move digital money in increasingly pointless complex ways.

In financial markets, we talk about 'naked' positions. That is to say, the trading of a financial product with no need to do so except to try and make a quick buck in the global casino. Futures contracts were invented so that a farmer could sell his corn before it was harvested, in order to buy a combine harvester, and so that the corn flake factory knew exactly what the cost of their raw materials would be. Futures contracts were NOT invented so that some wanker who flies a desk could make an easy buck without so much as breaking a sweat.

The whole fucking system has gone berserk. Money is supposed to be exchangeable for labour or scarce goods, but instead money's just casino chips that have no use outside the global financial markets. We're all paying a heavy human price for our financial services, accounting, legal and administrative world, where we've ended up toiling over ever-growing mountains of worthless paper, instead of trying to build a better life for ourselves and future generations.

What the fuck are we doing, when our most brilliant minds go off to work in head offices, doing administrative and accounting type jobs, writing legal contracts, banking and other kinds of referee type bullshit? What the fuck are we doing, running a football match with 22 referees and a kid with two left feet who can't kick a ball?

Referees don't make a football match. Head offices don't make an economy.

Tags: #capitalism #banking #economics

This is a story about changing beliefs...

Imagine being marooned on a rock in the middle of a vast ocean that's so deadly to life that you couldn't survive for more than a few seconds if you fell in. The ocean is lifeless and has no utility: it can't be purified or harnessed to generate energy. The rock has a fragile ecosystem that keeps you alive, but there is a relentless wind that threatens to blow away all the life-giving nutrients at any moment. You don't know how you got there, why you're there, or how the hell you're going to get off the rock if it can no longer keep you alive.

Welcome to the world according to science.

Isn't it much nicer to imagine an anthropocentric world, where some kind of paradise was created by an imaginary sky monster, just for us. Imagine there's some invisible guiding hand, making things happen, always with us Earthlings in mind. Imagine there's an all-seeing eye that only gives a shit about one particular species on one particular planet. Imagine that this universe isn't all there is: there's also some kind of afterlife. There... that's much more comforting, isn't it?

You could say that scientists believe in nothing. They don't think we were put on Earth for a reason: it's just a cosmic accident. Energy condensed into matter; quarks combined into protons and neutrons, which were fused into atomic nucleii; atoms bonded into molecules and reacted to create amino acids and proteins; the primordial soup created life, through pure chance. There's no reason for us to be here, except that given enough time - 14 billion years ought to do it - life as we know it becomes inevitable, given the laws of physics laid down at the birth of the universe.

When you start to study cosmology, you get some perspective on just how insignificant we are. When you start to deal with things on a cosmological scale, the numbers boggle your mind. There aren't even rulers that can measure the distances between objects in the night sky, because space and time are warped by matter and energy. Things are so far away, and we only have a tiny planet to move around on, so it's not like we can triangulate the position of anything. Everything in the universe appears to be just a point in space to us: the twinkling dots of light in the night sky.

If you think about time and evolution, you begin to see the staggering number of living creatures that died - our ancestors - so that we could be alive today in our current form. Take a look at an ear: it's a fucking weird looking thing, isn't it? Why the hell would it look like that? I can't tell you, but I know that I can take a shower without getting water in my ear canal, which is pretty awesome for listening out for any approaching sabre-tooth tigers while I'm washing myself.

Then, what about consciousness? Why is it that you are you? Why were you were born at the exact moment you were born? Why are you alive, right now, and not a hundred years ago, or a few thousand years ago?

So far as you know, you're the only you. Everybody else is somebody else. You've got your own unique set of experiences. You've got your own unique set of senses, and your own consciousness processing the sight, sound, smell, touch and taste of everything around you.

Ultimately, we can reach the conclusion that each universe is actually tailored to a single individual. The reason why there are lots of other people around who look very much like you is an inevitable consequence of the universal laws of physics. If I tweak the numbers one teeny tiny bit, we might get an almost identical universe, but there's a different person whose mind is "the one" that is truly conscious.

You feel pretty conscious, don't you? You feel like you've got free will and memories and you're seeing the world, right now, for what it is. But, that's only in your own universe. In your universe, I have no free will or consciousness: my world is dictated by your actions. In your universe, I'm not deciding to write these words... I'm not even aware of what I'm doing, even though I think I am.

The test is this: what would happen if you killed yourself?

Right now, there are about 7 billion people in the world. If I was to kill myself, 7 billion people would agree that I was dead and buried. 7 billion people would say that I just killed myself. But what about me? What about my opinion?

Here's how it goes: I get a gun, aim it at my head and pull the trigger. Guns are pretty reliable these days, so lets say I have only a one in a million chance of surviving a point-blank gunshot wound to the head. This is my free will, right? I make the decision to commit suicide, because I'm a conscious being with free will and that's my prerogative to do so.

So, what happens if the gun misfires? What happens if I put the gun down, pick up a different gun and that one misfires too? What happens if I pick up a machine gun, aim it at my head, pull the trigger and it just goes click-click-click-click-click as it keeps misfiring?

Essentially, if you take our very best scientific theories and follow them to their inevitable conclusion, this is what is predicted. If you keep asking "why?" over and over again, until you get to the deepest possible understanding of the universe as we observe it, you will conclude - from reproducible experiment - that the world is influenced by us, as observers. Our very consciousness is inseparable from reality and the laws of physics.

It's quite possible to answer the question "why are we here?" with the answer: so you can ask that question.

That might sound like begging the question, but it's actually perfectly logical.

Without consciousness, the examination of the world around us is not possible. Arguably, without being conscious of the existence of the universe, does the universe really exist?

Taking this reasoning a stage further, you can start to argue whether anybody in the universe in which you inhabit has ever truly been conscious. The evidence would suggest that they haven't, given that they are not able to experience the universe as you do: they are not able to answer the quantum suicide paradox, so they are unable to prove or disprove the reality in which they inhabit.

You and you alone are truly conscious, and everybody else is just an inevitability of the laws of the universe: entropy will destroy anything so ordered and sophisticated as a conscious being like you, but once you get one (you) it's inevitable that there will be billions of knock-off copies that didn't quite make the grade in your universe.

Ultimately, you are immortal and you will witness the end of the universe. It's the only logical reason why you were born when you were born.

"But what about all those people who die before me?" I hear you ask.

Well, they were never really conscious. I'm sure that in their own universes, which were nearly identical to yours, they were perfectly conscious, but the one universe in which you live, is made just for you: you're going to witness the death of everything and everybody, even if you try to kill yourself.

Taking this a stage further, we then wander into the territory of the theological.

What about heaven and hell?

If you're immortal, how do you think the world's going to be shaped by your actions?

Once you realise you're immortal, are you going to be naughty or are you going to be nice?

How's anybody going to stop you doing anything you want, if they can't kill you? You might as well be a thief; you might as well rape and murder; you might as well take anything you want and enslave all of humanity. As you rape and pillage, the world will become scorched and barren: Hell on Earth.

Alternatively, you could live virtuously, impart your wisdom and not abuse the discovery of your immortality. You could influence the people of the world to look after their home planet and try to preserve it beyond the longevity of their mortal lives. Over time, the world will become a place where everybody benefits from the generation before them, and it becomes received wisdom that it's better to co-operate and act with restraint, rather than act selfishly: Heaven on Earth.

Thus, we have arrived at a scientific reason for morality, as well as the negative consequences for 'sinning'. Science has drawn the same ultimate conclusions as religion: don't be a dick.

The chances are our species will wipe itself out before we are able to terraform nearby planets. The idea we're all going to fuck off to Mars on one of Elon Musk's SpaceX rockets, is actually just a massive excuse to continue raping and pillaging. The billionaires think that they've got an escape capsule, so there's no reason to rein in the corporate excesses and end the inequality that's destroying the planet.

Scientifically and through historical study of past civilisations, we're utterly fucked. The pursuit of pacifism, debt forgiveness, abolishment of usury and the creation of a fair and equal global society, has been completely abandoned in favour of rape and pillage. Capitalism must inevitably lead to the destruction of the natural world, overpopulation and enslavement of the developing nations, in order to fulfil its insatiable demand for unnatural growth. Things can't grow forever on a planet of finite resources: the laws of physics say that we can't just magic all our problems away.

We're acting like a blackjack player who's got a score of 20 but asking for another card, hoping to get an ace. Chances are, we're going to bust.

I really don't want a Tesla electric car: I'd rather not have to go to my bullshit made-up job. I really don't want a rocket ride to Mars: I'd rather people in Africa had some bicycles. I really don't want a NutriBullet food blender: I'd rather we abolished economic policies that leave nations starving, while others waste vast quantities of food. I really don't want an iPhone 8: I'd rather not have wars over mineral resources needed to make throwaway electronic gadgets. I really don't want private schools and top universities: I'd rather educate young women so they can make smart family planning decisions.

Just remember where the fuck you are: you're floating on a rock in the vacuum of space, with an incredibly thin layer of atmosphere just clinging to the surface because of the extremely weak force of gravity. The only reason the air isn't blown away into space - leaving you suffocating - is because planet Earth has an iron core which generates a magnetic field, diverting away the solar wind. Only 29% of the planet is land, and the rest is salty water you can't drink or use to water the crops. Have some fucking humility.

"But I'm some hot-shot CEO of a massive global corporation"

Yeah, right buddy. Try counting your money while holding your breath.

"But Elon Musk is going to fly me to Mars"

Yeah, and what are you going to do when you get there, you fucktard? There's no breathable atmosphere. There's no fertile soil.

"Scientists and engineers will find a way"

You mean the guys and girls who are telling you that the climate is fucked?

"God will guide us"

Good luck with that.

Tags: #economics #capitalism #politics #physics

This is a story about the pecking order...

Respect my authority. I did well in school and I've risen up the chain of command. I have stripes on my epaulettes and letters after my name. I've got a fancy job title and I'm very well paid. Don't-you-know-who-I-am and I'm oh-so-superior to the likes of you. Back in your place, underling. Get back in line.

Our systems of population control breed subservience. Why don't the workers rise up and seize the means of production?

"I'm not good with numbers"

"I've got no interest in politics"

"I just keep my head down and do what I'm told"

Could there be anything more degrading than having your fellow human beings sitting in judgement over you? Who are they to say "yay" or "nay" on the question of your utility? How dare they decide your fate!

Job insecurity keeps wages down, because workers develop a misplaced sense of gratitude for their income. In hard economic terms, workers get a terrible deal: they do all the work and they only see a tiny fraction of the profit. Why on earth would they do that?

"You're easily replaced"

Yes. While I dislike people who attempt to make themselves into key-man dependencies and build little fiefdoms of complexity to make themselves indispensable, I also think that the commodification of human beings is one of the most awful things that's happening in the modern world.

What happened to the artisan; the craftsman?

Small is beautiful, in a way. Think back to a time when each village had a butcher, a baker and a candlestick maker. There was the blacksmith, the miller, the cobbler, the tailor, the farrier, the thatcher. There were apprentices aplenty and sons followed in their father's footsteps.

Of course, it's easy to bring up infant mortality and the large number of women who died during childbirth. Infections and treatable diseases used to be fatal. In the past, manual labour, poor diet and poor healthcare, meant that life expectancy was much lower. People were superstitious and afraid of death and disease. Nobody went skydiving.

Now, nobody has any place. We live with terrible insecurity. We could lose our jobs and have our homes repossessed at any moment. If your job becomes redundant due to ever-advancing technological changes and globalisation, you're unlikely to be able to afford to retrain. Besides, how would you ever even compete with all the people who are already trained and vying for the few available jobs?

What's the purpose of anything? What meaning is there to anything?

It was pretty clear why you got up at the crack of dawn to light the fire in the ovens: because if you didn't, people wouldn't have any bread and they'd be pissed off about that. In the village, everybody would be like "no fucking bread" and "yeah, I know. Shit isn't it!"

Now, why did you work hard at school, go to university, battle through those job interviews and kiss arses as you squirmed your way up the greasy pole; the career ladder? So you can punch numbers into a spreadsheet and give powerpoint presentations? So you can go to meetings and sit on cramped commuter trains? So you can eat pre-packaged sandwiches at your desk, getting crumbs all over the keyboard? Why the fuck are you even alive? What's the point of your existence?

If you're trying to get a fancier car so you can impress your friends and neighbours, or if you're trying to get a pay rise and a promotion, so you can 'win' and brag about how rich and successful you are, then perhaps you've found your purpose. Perhaps status symbols and meaningless job titles are the answer to the big question: why are we here?

What happens when it all goes bang and the whole fucking mess comes tumbling down? What happens when you realise you wasted your whole fucking life? You can't eat university diplomas or bonds or banknotes. You can't keep a house warm with supply chain statistics or flow diagrams. You can't live in an insurance certificate or legal contract. You can't clothe yourself with tax returns, essays, dissertations or theses.

Our world has divided into two camps: the celebrities and the nobodies; the powerful and the powerless; the rich and the poor; the smart and the stupid; the valuable and the valueless.

Did you ever notice how anybody who's anybody is rich, famous, powerful, smart and incredibly valuable to humanity, and everybody else is a worthless nobody who can go to hell? "Everybody else" accounts for 99% of the world's population, by the way.

Who wants to read the autobiography of Ahmad who sits behind the counter at my local dry cleaner? He must be pretty stupid if he's not powerful or rich. He's not famous so he can't have any value. He knows his place, which is about the only good thing we can say about him, right?

Modern society has led to city living because of economies of scale. It makes sense to have a multi-billion dollar mass transit system in a city, to make it easy for everybody to get to work efficiently. It makes sense to build all the high-rise head offices that can hold thousands of people, in one place. The net result is urban solitude and anonymity. Nobody knows who their neighbours are. Nobody knows who the local shopkeepers are. Nobody knows anybody, except the rich famous people who are the only ones with any value: they're indispensable.

One face is the same as another. Two workers who've held the same job title are interchangeable. Hire and fire. Who gives a fuck... human lives are cheap. Make the balloon go higher by chucking more bodies onto the fire.

We are running our economy by the numbers: we're wedded to our spreadsheets and all we care about is that this month's numbers are bigger than last month's numbers. Growth! Growth! Growth! More! More! More!

The top tier - our rulers, our managers, our executives - look at the graphs: are they going up? Who gives a fuck what's going on at the bottom. The tip of the iceberg is in charge of the rest.

You're drowning and freezing cold in the icy depths. You're part of that huge mass of ice beneath the surface, but you'd better not try and climb out of the water or else you'll topple the whole system and plunge the tiny tip into the depths... and nobody wants that, do they?

Chances are that you could do a better job than those in charge, because the country couldn't get much worse: inequality is a disgrace, poverty is rife, depression and suicide rates are skyrocketing, life is miserable and there are few prospects.

We're supposed to be ruled over by a house of commons: ordinary people from all walks of life. In fact, career politicians and massive political parties supported by wealthy donors & commercial interests, completely dominate the political landscape. We live in a plutocracy, as evidenced by the fact that the rich are getting richer and the poor are getting poorer.

I count the middle class in the 'poor' bracket.

Of course, it seems ridiculous to suggest that well paid educated professional people in the middle class are poor - they have the best jobs, high quality housing and disposable income - but within a generation or two, the middle class are going to be utterly fucked. Skyrocketing house prices just don't work: they will erode your wealth, because you want somewhere for your kids and grandkids to live, don't you? Unless you live in a castle big enough for all future generations of your family, you're going to need some affordable housing at some point.

University tuition fees and the cost of student accommodation, comes on top of the private school fees you paid in order to get your little darlings the straight-A grades they needed to get onto the few degree courses that might lead to an actual job. A job doing fucking what exactly?

OK, so your silver-spooned little shits got themselves a degree and a professional qualification in law or accountancy or something, but you're going to have to fork out £100k+ to get them onto the housing ladder. Your terribly bright and brilliant kids now need a place to live near their job - London and the South-East - which means top dollar house prices.

Wealth has been hoarded by the baby-boomers who were gifted it by good luck and the inflation that eroded their debts relative to their incomes. The baby-boomers are now having to fork out all that filthy lucre in order to support their children and grandkids. There just aren't any well paid jobs that allow our special snowflake millennials to support themselves financially, no matter how hard they work.

So, the only group who have a place are the ones at the top of the pile: the ones who already control more wealth than they could ever spend in a hundred lifetimes, and who can easily generate some more because they already have the money, the fame and the power to make a success out of whatever the fuck they want to do. I mean, Paris Hilton is a DJ now, for fuck's sake: she presses the play button on a CD player and people pay to see that fucking shit.

All in all, why bother? Why the struggle? Why the stress? Why the anxiety and and the insecurity and the hideousness of battling over the crumbs from the cake?

We're all fighting with each other at the bottom, like crabs in a bucket, pulling down anybody who tries to escape.

Just stay in your place though. Don't complain. I'm sure those in charge know best.

Tags: #politics #capitalism #economics

This is a story about parasites...

Everybody has to work, right? There's a social contract that we implicitly signed up for when our parents had sex on our behalf. In return for our parents' selfless act of having unprotected sex, we agreed - before we were born - to a life of wage slavery and paying bills.

The other way of looking at things is to ask what would happen if you didn't work.

A big hole in the ground was dug to make the foundations of your house, where you live. You dug that hole, right? What about the concrete that was used to fill the foundations? I presume you slaked the lime to make the mortar and you dug the aggregates to make the mix that was poured into the hole you dug. I mean, that's only logical.

Bricks were laid to make the walls of your house. I presume you collected the clay, shaped it into bricks and baked them in a kiln that you made. That's only logical.

Joists and beams were needed to make the floors you walk on and the roof that keeps you dry. I presume you chopped down those trees and milled them into the straight timbers that were needed. That's only logical.

Slates were hung to make your roof able to divert rain into your guttering. I presume you quarried those slates. That's only logical.

Nails were forged to join the wood. I presume you collected the iron ore and blacksmithed the nails. That's only logical.

Sand was melted in a furnace at incredibly hot temperatures to make the glass that glazes your windows. I presume you gathered that sand and kept the fires burning in order to make those panes of glass that adorn your house. I mean, that's only logical.

Meat, vegetables, kernels, pulses, herbs, salt, oils and other condiments were combined to make delicious meals to keep you going while you were doing all that hard work. I presume you farmed the edible things to make those meals. You harvested the corn, milled the flour and baked the bread. That's only logical.

Water was raised from the underground aquifers. I presume you dug the wells and winched up the buckets of water. That's only logical.

How are you doing so far? You can say that everything you've benefitted from has been a product of your own hard labour, right? You can show directly how your contribution to society means that you deserve your slice of the pie, of course. That's only logical.

"Actually, I'm much more important than that."

Right, let's test that hypothesis.

What do you actually do?

"I go to meetings in a big fancy office."

Alright. Let's go.

Coffee beans were picked, dried and roasted. The coffee was ground and infused in boling water. I presume you were there in South America, harvesting the crop. I presume you roasted your beans and ground them yourself. That's only logical.

Spreadsheet software was crafted from binary ones and zeros. Microsoft Excel was created from nothing, using computer programming. I presume you wrote Excel. That's only logical.

Companies were incorporated with memorandums and articles of association. Laws were made. Everything was written down on paper. Paper was made from wood pulp. Ink is made from pigments and dyes. I presume you made the paper and the ink, and you wrote down all the laws that govern your company. That's only logical.

Cotton was picked. Thread was made. Thread was woven into garments. Fancy shirts and suits of clothes were made so that the people in the offices could look powerful and important at their meetings, sipping coffee and putting made-up numbers into spreadsheets. You made all those things. That's only logical.

How are you doing now? Are you with me so far?

"You just don't understand. I paid for all those things."

Oh you PAID did you? Let's see how that stands up to cross-examination.

Gold was panned or mined out of the ground. Gold was melted down into bars and coins that were assay marked to vouch for purity and weight. I presume you were down in the mines with your pickaxe, or in the river bed with your panning bowl, plucking gold nuggets out of the ground. I mean, that's only logical.

Banknotes were printed and coins were minted. Banks held ledgers and reserves. Payments were recorded. I presume you made the currency that was hard to counterfeit. I presume you created the payment systems that were hard to defraud. That's only logical.

How about now? Keeping up?

"For fuck's sake. You just don't get it. I did my job and I got my salary. That's how I paid for my house and my food."

Oh, right. I get it now. What exactly did you do for your job? What exactly was your contribution?

Tags: #capitalism #economics #career

This is a story about fantasy worlds...

It should come as no surprise that a geek like me played Dungeons & Dragons a couple of times when I was a kid. Actually, I played the Marvel Super Heroes role-playing game far more. I think I even got to be 'dungeon master' one time, setting an adventure in the Marvel world.

Really, I've had little desire to retreat into the fantasy world. When I was a kid I used to spend a lot of time day-dreaming, but that was as much borne of frustration with age-related restrictions. In the UK you can't drive a car until you're 17 years old. You can't get a credit card and it's generally assumed that you're going to be stuck in school until you're 18. You can't get a decent job that pays decent money until you're 21+ and even then you're probably going to be too poor to afford any of the things that you really want. However, I took a few short-cuts and I was able to start doing some cool stuff soon after leaving college.

Writing a work of fiction - a novel - was not something that came from plot lines and characters I'd been imagining for a long time. I hadn't been inhabiting some inner fantasy world; waiting for the right time to put it down on paper.

What seems clear to me is that so many of us are keen to escape from day-to-day reality. You've realised you're never going to be a professional footballer or pop singer, so now what's the best you can hope for? That you don't die penniless and in a great deal of pain and discomfort? Yeah, the problem is that you're definitely going to get sick and old, and you're definitely not going to be be rich & famous.

To ditch your responsibilities and run away is a widely held fantasy. You've got your career, your reputation, your spotless curriculum vitæ, your mortgage and loans, your life insurance, your pension. You've got to think about your credit rating and what 'box' you fit in. If you quit the rat race, do you even exist?

I often wonder why people stay in lame underpaid boring jobs, doing shit that's doing nothing to benefit anybody - at best - and at worst is downright destructive. Everyone must be a damnsight more locked into the system than we dare to talk about. The number of households who would go into mortgage or rent arrears if they missed just one or two paycheques is astounding. We don't dare to dream because we can't afford to.

I'm a sensation seeker, so I must admit that I'm totally comfortable flirting with disaster. There's no such thing as "rock bottom" in my world. Even in some diabolically awful situations, I've been thinking "I really need to tell people what this is like". Everything that I've experienced is an asset not a curse. Writing about some things that I've been through has been the payoff for the short-term pain and discomfort I felt.

It's alarming to see a world that revels in fantasy. It suggests that we are so downtrodden that we no longer have realistic aspirations. People have given up on the idea of wealth and status, and instead they immerse themselves in the lives of cartoonish fantasy figures: celebrities who live lives of unimaginable riches and fame.

There used to be a time when the fantasy was to get married, buy a house, have kids, a job for life, a trade or a profession. Now we fantasise about being people we're not; people we could never be. In a pyramid scheme, there's not enough room at the top for everybody. We all lose out in a pyramid scheme world. I really don't give a fuck about the land of opportunity because the opportunity doesn't really exist. On the balance of probability, you're just one of the luckless fools who's helping the rich get richer. Every time the pyramid gets a little taller, you get pushed a little lower, down into the dirt.

A truly remarkable discovery for me was that most people are doing a lot worse than you think. Even though we put a brave face on everything, the free market has evolved to separate fools from their cash very efficiently. You might earn double or quadruple what the average person does, but you shop in a more expensive supermarket, buy more luxurious things and have more expensive tastes. You have pigeon-holed yourself into the income bracket that means that you have more-or-less the same amount of disposable income as somebody in a completely different socio-economic group.

The fun part of my 'research' during the past years, has been to take that journey: from the homeless people in the park, living off London's unsold sandwiches, to the fakers living a life of pseudo-glamour and trying to present an image of wealth and success. Scratch beneath the surface and you see that the people at the bottom have given up, while those in the middle are hopelessly trying to claw their way to the top, totally unable to see that they're being pushed ever downwards.

One final thing: when you do give up, it's just as fun and liberating as you'd think it would be.

Tags: #writing #homeless #capitalism

This is a story about real life, far from the Internet...

Are you familiar with the acronym "IRL"? By some definitions, it stands for: In Real Life. Many people believe IRL is a synonym for any human interaction that occurs face-to-face. Did you also notice that I always capitalise the word Internet? Ever wonder why I do that?

If I speak to somebody on the phone, is that real life? If I send them a handwritten letter, is that real life?

The distinction between 'real' life, and the life we live with technology mediating our interactions with each other, has become rather pointless. I'm no great fan of video chat, but it's certainly an advancement on the telephone. All telephone calls are routed through digital exchanges, and the same infrastructure that carries your voice also carries the data of your Internet connection. There's nothing much more real about having a face to face conversation, shouting through a wall at your neighbour, making a Skype call (who does that anymore anyway?) or phoning somebody on their mobile.

The Internet is a real place, hence the noun. People can meet there, trade goods, gossip. "But you can't physically interact" I hear you wail. "What about touch, smell, taste?" Yeah yeah yeah. Are you saying that the phone-calls you used to make on that old rotary-dial telephone weren't real life?

This is the beginning of a piece I've been wanting to write for ages. I made a note on my smartphone of the title, but I'd already been mulling the topic since a friend - who I've seen in real life only twice since childhood - made the very good point about the Internet being a real place. I was thinking about writing this well before a different friend - who I hadn't seen in real life for nearly 20 years - posted an article on this topic on Facebook. The timing is too perfect.

I've lived 'online' since I saved up my money from my job washing up in a hotel kitchen in order to buy a modem. When I bought my modem, the Internet wasn't yet a big thing. Instead, I used to get magazines that had loads of phone numbers in them of dial-up bulletin boards. Using technology that predated the Internet in the guise we know it today, I used to be text-chatting online, electronically mailing people and playing online computer games, via bulletin board systems (BBSs).

Then, I took to Internet newsgroups which were a popular fore-runner to the forums and social media pages we have today. I even met a rock climbing partner on a newsgroup. If you don't think that putting your life in the hands of a random stranger off the Internet is real life then I don't know what is.

I spent thousands of hours reading and contributing to three kitesurfing forums. People who I first met online had countless evenings spent drinking, weekends away and holidays to exotic locations together. All of which occurred away from keyboard but it was very much real life. It was real when we were all talking to each other on the Internet all week long, during our dull office hours, waiting for the next time we could go to the ocean together.

This is where things get super blurry. I have so many friends I've made through social media (newsgroups, forums) and a lot of old friends I'm able to still remain in some kind of contact with because we are connected via Facebook. Would I have been able to pick up an old friendship with school/college friends who I hadn't seen for circa 20 years, if there hadn't been some real and somehow tangible tie together, even if it was mediated by binary ones and zeros in the ether of the 'cloud'?

The dust has been gathering on my keyboard since I completed the first draft of my novel. I haven't been blogging regularly for a while. I miss writing and I miss having an open dialogue with everybody and anybody on the Internet. The Internet has brought me friends and fortune. I've never regretted the investment of time I've made in channelling my creative energies into a public space that creates nothing tangible per se. What is software? What does it mean to publish a blog or a book online? If you can't hold it, sniff it, lick it... if it doesn't gather dust, does it really exist?

There was one slightly embarrassing moment in my recent adventures Away From Keyboard.

I was out for dinner with another friend. You could say I know him in real life because the first time I met him was face to face... or you could say I know him through the Internet, because he was introduced to me by somebody I know from an Internet discussion forum. Either way, it's immaterial to the embarrassing story.

Over dinner, my friend expressed his incredulity at the fact that the value of all the coal bought and sold is a tiny fraction of the total value of all the financial contracts (securities) that are created off the back of the physical commodity. So many more coal futures and options contracts are bought and sold by speculators, hoping to profit from a movement in the price of the commodity, versus anybody who actually wants the real coal. The dirty black lumps of carbon are almost unimportant... the 'value' in the financial markets dwarfs the heavy industry that mines coal out of the ground and ships it to power stations and for people to heat their homes.

The embarrassing thing was that I went to speak and then I realised that I had nothing to add. I was left speechless. I've written at length on my blog about the staggering 'value' of the derivatives contracts versus the real economy. Is it me who's splitting hairs, expecting us to care about food and housing and water and healthcare and transport? Is it me who's the luddite, saying that the global financial markets are utter horse shit because it's all just digital money in the Fintech 'cloud'?

Maybe the real embarrassment is that I'd had that conversation before, with a hedge fund manager and a director of an investment bank. We were on our way home from the airport, having been kitesurfing in real life with 20 people from an Internet discussion forum. I was just about to start work for JPMorgan, dealing with Credit Default Swaps. We thought that the financial markets were overleveraged and that there was going to be a crash. That was 2005.

Did I put my money where my mouth was? Yes. I bought dollars at nearly $2 for every £1 I paid, and bought gold at $550/oz. One ounce of gold cost £225 back then. One ounce of gold is worth £920 today.

The point is not to be a doom-monger or gloat in a "told you so" kind of way, but to try and express how tired I am by everything. Being Cassandra is shit. Churning out my thoughts into the ether has allowed me to say everything that needed to be said, but it left me kind of breathlessly shocked to encounter anybody who'd arrived at the same rational and reasonable analysis of a ridiculous situation. That's one thing you don't get when you're lecturing the Internet: any kind of feedback that anybody agrees with you.

So, what's my closing conclusion? I'm back blogging, because I love writing, but aside from setting out my position clearly for posterity, some time away from keyboard is pretty handy to remind oneself that there are a lot of people out there in the real world who share my values and concerns.

Tags: #socialmedia #writing #computing #banking #capitalism

This is a story about a fictitious bear and an imaginary bull...

To explain how a speculative bubble bursts is very easy indeed. Investors are like a herd of cattle. They are not rational actors. When a critical mass of investors become spooked and start selling off their investments, this creates a market with more sellers than buyers, which means the asking price for financial instruments has to be lower to attract more buyers. Pretty soon, there is a stampede, as all the investors try to 'cash in' their investments and take their profits or minimise their losses. The asking price drops lower and lower, and buyers simply wait, knowing that the ever growing crowd of panicked sellers will underbid each other in a desperate attempt to offload their devaluing assets.

Anyway, that's so simple and obvious that it doesn't warrant further discussion. What I want to write about is what causes a speculative bubble in the first place.

We could look at historical examples, like the tulip mania during the Dutch Golden Age, with tulip bulb prices peaking in 1637, before crashing spectacularly. The Madness of Crowds explains the crash, but not the initial price bubble, in any satisfactory way for the modern financial markets.

To understand your average investor in publicly listed companies on the major stock exchanges, you only need to understand two human characteristics: greed and laziness.

The greed part is simple. Any of your friends who have reached a point of economic prosperity where they have disposable income are likely to have 'invested' some of their wealth. It's highly unlikely that they made angel investments in small startup companies where they knew the founders, the business model and understood the domain in which the embryonic enterprise operated. Instead, they thought they could make a quick buck by buying shares in a major corporation.

The laziness part is slightly more complex. The lazy divide into two groups. The speculative private investor looking to make a quick buck isn't interested in doing any actual work in order to earn their extra wealth. One phonecall to your stockbroker, having read a stock tip in your preferred newspaper does not count as an investment of labour, and so it is clear that these investors are lazy.

The second group are institutional investment managers: the people who look after pension funds. Now, you can ignore profit:equity (PE) ratios, yields, earnings per share (EPS), turnover and EBITDAs (Earnings Before Interest, Tax, Depreciation and Amortisation). You can ignore the philosophy of Warren Buffet, who is an active shareholder. The pension fund manager is passive and invests for one reason and one reason alone: the market capitalisation of the public company has reached a certain threshold. That is to say, the market values a public company above a certain amount of money.

To understand market cap, let's take Apple Inc. as an example. We take the number of Apple shares that are issued (5.4 billion at time of writing) and multiply that by the share price ($118 at time of writing) and we arrive at a market capitalisation of $637 billion. That is to say, if you had a spare $637 billion in your bank account, you could buy Apple outright^*: every single share. You would be the sole shareholder of Apple, which is the biggest company in the world, by market capitalisation.

Now, Apple might have absolutely dog shit products lined up for the next 10 years. The CEO, Tim Cook could be an absolute moron who's going to run the company into the ground. The institutional investment manager doesn't give two hoots. They're going to buy Apple stock simply because it's highly valued. In fact, they're going to buy ALL the highly valued companies, above a certain market capitalisation.

In the UK, we have a kind of football league, with the premier league being the FTSE100 and then the league below being the FTSE250. As the market caps change, companies drop in and out of these 'leagues'. Consequently, investment managers will buy the new entrants and sell the ones that drop out. Easy as pie, right?

The laziness that drives all this is retirement. People saving for retirement are too lazy to make their own investments that ensure the value of their pension is not eroded by inflation, so they get an investment manager to 'track' the value of an index like the FTSE100, which generally outperforms inflation, over a long period of time. That makes sense, right? Money invested in the 'best' companies, should outperform money that's just sitting in the bank earning interest.

Furthermore, when people come to retire, they want their pension pot to be managed for income not for growth, but they're still too lazy to shop around to make sure that the yield or dividends that they are receiving on their pot of money give them the best possible income, while also protecting their capital.

In essence, the biggest part of our economy is driven by greedy lazy people. Instead of the industrious and ingenious entrepreneurs finding it easy to borrow money or sell a share of their company in order to raise the capital they need to grow, the sad reality is that almost all of the wealth in the developed world is ploughed into corporate behemoths that have already extracted all their value from the public, in order to keep people who have nearly reached the end of their lives in the manner to which they have become accustomed to.

Yes, that's right. By the time a company comes to the point where it floats on a stock exchange, it has peaked. It's time for the original founders, angel investors, venture capitalists, private equity and other shareholders to now cash in and fleece the public by offering their shares in an Initial Public Offering (IPO). Because the company has reached a certain 'valuation' (as decided by market sentiment and the bullshit written by the underwriting investment bank in the prospectus) then it has to be bought by the institutional investors, because it is highly likely to have a market cap that will put it straight into the FTSE100 or FTSE250. The companies with the smallest market cap in the FTSE250 are around £400m; for comparison Twitter floated with a market cap of $30,000m, which is 75 times more.

Let's take a hypothetical example. If I was to build a company with a turnover of approximately £20m per month, or £240m per year, then one might say that it could be valued using a rough multiplier of 2x turnover at £500m. That would easily be enough to make for an attractive IPO, because the market cap is going to attract all the institutional investors who have to buy FTSE250 companies. In effect, the IPO is underwritten by the pension tracker funds.

Therefore, greedy lazy people buy dog shit stock, it appreciates in value because of market sentiment - "ooh the price is going up, let's buy more" - and the fact that public companies can use their shares to acquire other companies (growth through acquisition) until they have a dominant market position (some may say monopoly, ahem!).

Growth through acquisition is not really growth. If I have 100% of the shares in company A, and 0% of the shares in company B, and then I use 49% of my shares and a bit of cash to acquire company B, such that I now own 51% of company A and 51% of company B, no new value has been created. There may be cost savings, there may be benefits from anticompetitive practices, but really all I'm doing is increasing the market cap of the parent company, hoping to move from the FTSE250 to the FTSE100, where a whole load more pension funds will have to buy shares for their index trackers.

The same deal goes on in the US, where companies are trying to IPO at a certain valuation in order to get into the Dow Jones or the NASDAQ, such that the US tracker funds will have to invest. The public - mostly pensioners - get fleeced.

So, in conclusion, the cause of a speculative bubble is actually institutional. Because the pension funds are so massive and they are passive investors, using index tracker funds, there is an immense amount of fake value created by mergers and acquisitions, as growth by acquisition carries such huge rewards. This starves the companies - who are truly growing and innovating - of much needed investment capital, stifling the economy and instead creating corporate giants who are too big to fail.

Eventually, the central banks and the rest of the money multiplying machine reaches the limit of how much the value of dinosaur institutions can be artificially inflated. These dinosaurs move at glacial pace and stifle change and competition. The lack of efficiency of markets to deliver capital to those companies who have true growth potential, undermines the economy for years, until finally things reach breaking point.

Overvalued companies, market disruption by venture-capital backed challengers, the faltering of capital gain and the end of effortless profits, are the things that spook the lazy, greedy investors. So, then begins the market crash.

The dying behemoths are dangerous animals. For example, the 'too big to fail' banks were able to hold the world's largest economies to ransom, with the threat of unimaginable disruption to our systems of payment and borrowing that underpin so many mortgages, overdrafts, credit cards, car loans and how we get and spend our wages each month.

For now, the status quo persists, because the idea of smoothly transitioning to truly free and competitive markets is beyond comprehension, such is the web of complexity that has been created by supranational organisations that have swallowed so many competitors around the globe.

Until we move to active investment rather than passive investment, we will always have the cycles of boom & bust.

Tags: #economics #capitalism

* - You couldn't actually buy all Apple's shares for $118 each, because the very process of buying up all the available stock for sale would drive up the price. I merely offer a simplified example.