SPOILER ALERT

Presentation: Understanding and navigating the economic crisis

What this presentation is about is best described by Eliot Spitzer, former governor of New York, who made the following statement after he had been forced to resign last year following a scandal involving booze and hookers (but reportedly because he opposed central government meddling with the banking system):

"The federal government is sending each of us a $600 rebate.If we spend that money at Wal-Mart, the money goes to China. If we spend it on gasoline it goes to the Arabs. If we buy a computer it will go to India. If we purchase fruit and vegetables it will go to Mexico, Honduras and Guatemala. If we purchase a good car it will go to Germany. If we purchase useless crap it will go to Taiwan and none of it will help the American economy.The only way to keep that money here at home is to spend it on prostitutes and beer, since these are the only products still produced in US. I've been doing my part, and I thank you for your help”

Understanding and navigating the economic crisis

by Ernesto Spruyt - February 2009 (ernestospruyt@freeler.nl)

Goal: provide insight in the workings of the system that we call ‘the economy’ to be able to better navigate the current economic crisis as a manager and/or entrepreneur

Method: Simplified explanation of a wide number of issues, possibility to go in depth where the audience would like to

Topics:-The economy in a nutshell-What happened?-How could it happen?-What could be next?-How to profit from it and save the/your world in the process-Pathways to action

The economy in a nutshell

The economy is not so complex as some would have you believe: it is merely the system of production and consumption

Production[creating value]

Consumption[using/wasting value]

Saving[storing value]

Spending[exchanging value]

Borrowing/Debt[promising value]

The money domain: 1) a means of exchange; 2) a store of value; 3) a unit of account

Good credit

Bad credit

Wealth

Poverty

Unlike what is stated by many politicians and ‘economists’ in the media, consumption does not lead to wealth creation. Saving and production leads to wealth creation. Consumption is the using/enjoying and/or wasting of wealth (which is not bad in and of itself to the extent that you can afford it).

A bank’s primary function is to intermediate between those who save and those who borrow

Why productivity and wealth creation are not the same

Economic ‘growth’ is not the same as growing prosperity; GDP is not a measure of socially desirable outcomes

GDP: Sum total of the monetary value of all final goods and services bought and sold in a country in a certain period. It has roughly 4 categories: 1) consumer spending, 2) direct investment, 3) government spending, 4) net exports.

Why GDP is not a good measure of value/wealth creation:

•No distinction between transactions that benefit people or do the opposite. E.g. producing tanks and using them destroys wealth but increases gdp; hurricanes are good news for gdp; more sick people as well. Judging a government by GDP performance clearly gives it the wrong incentive.

•It ignores transactions that are not monetized. E.g. 50 years ago somebody (your mother) ran the household unpaid. Now somebody else does it and sends a bill. This is not an increase in productivity or wealth, it is a redistribution of tasks and monetization of certain activities.

•Further it doesn’t take into account 1) the degree of distribution of the goods, 2) the quality of the goods, and 3) how they are financed (e.g. with borrowed money).

•And finally, 4) it is being calculated using a heavily doctored ‘deflator’...

Flaws in the money system: inflation - 1

Management of the money supply is a key instrument to drain wealth

•Price levels are determined by the available money in circulation in relation to the total of products and services offered. An increase in the money supply relative to products/services is called inflation. A decrease is called deflation.

•Please note: increasing prices is not inflation, but a symptom of inflation (more money chasing same amount of goods = higher prices)

•Central banks are responsible for managing the money supply in order to prevent inflation or deflation. In practice they create massive inflation, which have resulted in bubbles such as the tech-bubble and the housing bubble.

•How? Until recently mainly by increasingly allowing banks to leverage up and loosen lending standards and thus expanding credit in the system. Now increasingly by spending it into existence (creating it out of thin air).

•Why? I can think of at least two reasons:

1. Governments have three ways to obtain money: taxes, borrowing or creating out of thin air (=inflate). Inflation as a result is a hidden tax.2. Inflation means the currency being inflated loses value. As a result debt denominated in the currency also becomes smaller.

Flaws in the money system: inflation - 2

Governments have an incentive to create inflation, and an incentive to conceal it

•Simultaneously governments try to conceal the level of inflation, by means of exotic statistical measures such as hedonic regression and geometrical weighing.

•GDP figures are being corrected for inflation. The lower official inflation is, 1) the less severe the correction, 2) the more favorable the GDP figures...and 3) the lower interest rates, 4) the lower inflation correction of pensions and other social liabilities.

•This is not so good news for anybody on a fixed income, receiving an inflation-correction based on official inflation figures.

Flaws in the money system: debt & leverage

The amount of leverage built up in the system over the past 30 years is irresponsibly high

•Our debt-based monetary system (all money is backed by debt) is designed such, that it can only continue to exist when credit expands exponentially (because the banking system produces the principal, not the interest. In order for the system to be able to pay back the interest, it needs to keep adding to the principal).

•Leverage is the use of debt to increase return on equity. See what happens to a bank’s balance sheet when there is default on its outstanding credit:

•Just as money creation leads to exponential credit growth, defaults have the opposite effect (deleveraging). As the financial system is highly centralized/ intertwined this can snowball through the system.

•The only way to counter this is to create even more money/debt (=inflate), debasing the value of the currency...or file for bankrupcy.

•It would be better to not leverage up so much in the first place.

Assets E & L Assets E & L Assets E & LEquity 10 Equity 5 Equity 5

Debtors 110 Liabilities 100 Debtors 105 Liabilities 100 Debtors 55 Liabilities 50

Total 110 Total 110 Total 105 Total 105 Total 55 Total 55

Leverage: 1:10 Leverage: 1:21 Leverage: 1:10

Balance sheet pre-default Balance post-default Balance sheet post-deleveraging

Resource depletion: limits to economic ‘growth’

As we’re running into the limits of natural resource production, it’s time for a new paradigm (not based on ‘growth’)

•Although we have a monetary system designed for perpetual growth, our ability to grow the real economy is directly related to our ability to produce energy and other natural resources (production = transformation of energy and materials). This spells trouble as we’re reaching our limits to growth...

What this economic system means for your community

Our centralized economic system is highly inefficient, sucking the wealth out of communities like a tapeworm

In our ‘tapeworm economic system’ wealth is structurally being drained from communities by incentivizing centralization (of moneyflows, decision-making, etc). Hence, the comparison with a tapeworm: it makes you crave what is not good for you.

Take a look at the wealth drains in your personal or community’s economy:

Production[creating value]

Consumption[using/wasting value]

Saving[storing value]

Spending[exchanging value]

Borrowing/Debt[promising value]

Pension funds investing in ‘unethical’ multinationals instead of local sme’s

Savings are being destroyed by inflation

Banks engaging in irresponsible and/or predatory lending

Gov’t taxes spent on corruption, wars, undesirable policies and inefficiency

Products from (foreign) companies or that support/engage in ‘bad’ behavior

Banks finance ‘unethical’ corporations (abroad) but not your local entrepreneur

Think of this: removing these drains will not only make you crash proof; it is also a tremendous opportunity to create real wealth for you and your community!!!

Talent, creativity, time and energy spent on counterproductive activities

Oligopolies and unfair barriers, killing market dynamics

So, what happened? - 1

The key cause of the credit crisis is the structural overconsumption and underproduction of the US

•US living beyond its means: confusing consuming with borrowed money with building economic wealth

•Credit expansion stimulated by governments (e.g. community reinvestment act), resulting in extreme bubbles (first internet, then housing, now gov’t bonds)

•Irresponsible expansion of credit far beyond the point of fraudulent inducement (=lending while knowing one will not be able to pay off the loan)

•Exporting the risks using complex derivatives (such as CDO’s) with cover from major credit rating agencies

•Snowball effect: starting in subprime mortgages, causing failure of some financial institutions...

•...causing massive deleveraging, in turn causing systemic failure in financial markets; spilling over into the real economy as investment and consumption stagnate

•Governments making things worse by rewarding bad behaviour (taxing the capable for the benefit of the uncapable) and further obstructing the market forces to which they have been paying lipservice for decades

So, what happened? - 2

Ever since Ronald Reagan the US (bipartisan) government has been hollowing out its economy to the point of collapse

Production[creating value]

Consumption[using/wasting value]

Saving[storing value]

Spending[exchanging value]

Borrowing/Debt[promising value]

Lowest savings rate ever

Production moved overseas

Massive consumptive borrowing by state and consumers

Borrowing did not go in to productive spending

All savings have been spent

Confusing consuming with wealth creation

China/Japan/EU footing the bill of credit defaults

The run up to the crisis in figures...-1

The US has been living structurally beyond its means...

The run up to the crisis in figures...-2

...leading to an explosion in (unsustainable) debt...

The run up to the crisis in figures...-3

...leading to systemic failure, and government turning on the printing press (=massive inflation = lower living standards)

The bailout: why it aggravates the problem

Goverments try to solve this problem by creating more of what caused it: debt

•Creating more debt instead of less

•Rewarding bad behaviour while obstructing market forces (the boom is the problem, the bust is the cure)

•Debasing currencies by creating massive amounts of money out of thin air

Who is affected by reckless US policies?

Although the US economy is the main character in the current crisis, the consequences are global

At first:•Any country/bank/company/person that is leveraged up to the tilt (E.g. banks [like in Iceland], hedge funds)

•Anybody that has lent money to the US, to insolvent banks (E.g. to Lehman Brothers, Icesave), to insolvent consumers (buyers of CDO’s); big chance your pension fund has lost tons of money

•Anybody who runs a structural currount account deficit (lives beyond his means). (E.g. Iceland, consumers in debt)

•Anybody who is a supplier to the US (especially China / Asia)

Then:•Anybody who isn’t hedged against a global economic downturn

•Anybody who isn’t hedged against massive inflation (anywhere)

•Anybody who is heavily dependent on centralized money, planning & control systems

In short: (almost) everybody!

Global economy imploding

The effects of the credit crisis are starting to ripple through the global economy

How could this happen?

Apparently our political and economic systems are somehow flawed

Analyzing this debacle, the following question comes to mind:

•What flaws are in our political and economic system that caused this to be able to happen?

In particular:•Couldn’t anybody foresee that this would happen?

•Aren’t there supposed to be checks and balances?

•How is it possible that so many smart people take so many bad decisions?

•How is it possible the world keeps going along and keeps providing the US with credit?

Let’s explore the answers to these questions...

Some people did foresee the crisis...

It is not a free market when some are ‘in the know’ and the majority is not

...they were just largely ignored or ridiculed by the mass media. Any politician, business leader or commentator who says ‘nobody saw this coming’ is either ignorant or lying.

•Marc Faber, Peter Schiff, Jim Puplava, Gerald Celente, Nouriel Roubini, Catherine Austin Fitts, Jim Rogers, Nassim Taleb, (in NL: Willem Middelkoop); all respected commentators who predicted this crisis. All are consistently labeled ‘pessimists’ or ‘Dr. Doom’. Apparently predicting an undesirable outcome is politically incorrect.

•The media system is highly open to institutionalized corruption and self-censorship. E.g. don’t write something your largest advertiser or target group don’t want to hear/read.

•News media often confuse entertainment and public relations for journalism.

•The result is - whether intentional or not, whether you like it or not, and whether journalists like it or not - you are target of a propaganda system, which provides the insiders with the opportunity to be ahead of the markets.

PS: In the news last week: 48% of Dutch citizens regard the television news broadcast as a credible source of information. 33% of Dutch citizens regard newspapers as a credible source of information.

What about checks and balances?

We do not need more regulation, we need safeguarding and better (consistent) enforcement of existing regulation

Governments seem to have contributed significantly to the current crisis by removing checks and balances, giving ground to moral hazard and creating undesirable incentives:

•After the Great Depression in 1933 the Glass-Steagall Act was adopted to prevent another such crisis from happening. It served to protect the banking system, and prevent moral hazards. It was repealed in 1999 opening the way to the failures and reckless behaviour we have seen recently.

•The Community Reinvestment Act (1977, but revised 6 times up to 2005) obliges and encourages financial institutions to make unsafe loans, ultimately far beyond the point of fraudulent inducement (predatory lending).

•The Federal Reserve has contributed to the crisis by maintaining artificially low interest rates and allow the continuous loosening of lending standards.

•The SEC is at best only selectively enforcing the law, in many cases ignoring major signs of corruption and fraud (e.g. Madoff, Fannie Mae & Freddie Mac).

•The bailout and other government interventions aggravate the problem by rewarding bad behaviour and not allowing professionals to take over (crime that pays is crime that stays). Let them fail!

Smart people taking stupid decisions

Smart people generally do not take stupid decisions

•So this begs the question: are our politicians and captains of industry inherently stupid?

•Consider this statement: when smart people do something stupid, start being suspicious...

•...there is a good chance they have a hidden agenda (e.g. committing fraud or other crimes)...

•...or are being coerced.

Which brings us to the bigger picture:

•Why does the world keep lending the US money?

•Why does the world keep accepting dollars which are being created out of thin air?

The political economy versus the market economy

The economic system can not be seen separately from other systems; e.g. (geo-)politics, media, the environment

Economic policy decisions are sometimes driven by (geo-)political rather than purely economical considerations

What’s next? -1: short term outlook

The worst is yet to come: financial crisis is now transforming into an economic crisis [depression]

•Consumers will spend less and less as more people are being fired, credit markets collapse and economic conditions continue to deteriorate.

•Investments are currently minimal, also due to malfunctioning of credit markets. The economy is imploding, leading to depressed profit levels, massive job losses.

•Since this is international both imports and exports will go down as well. Countries/companies that produce vital stuff will do best in the longer run (natural resources, food).

•Governments will spend a lot of money but since many don’t have it and nobody will lend it to them they will create massive inflation.

•Severe inflation will kick in sooner or later, which means living standards will deteriorate even further from then (rising prices, but no rising incomes).

•Government bonds: the next bubble?

•Difficult/impossible to predict timing and severeness of the bottom, but considering peak-everything (=energy/resource scarcity) it will likely take years to recover (consider Japan: no serious recovery in the last 19 years)

What’s next? -2: long term scenarios

Economy & resource depletion: key drivers of the political, cultural and ecological landscape or our era

As we saw two main drivers will determine our future landscape: -Resource availability; this refers to the extent that resources - especially energy - will be available to fulfill demand without severly disrupting vital human support systems. Resource depletion is considered a key driver for sustainable development (including social).

-Economic cycles; this refers to the extent the economy is able to grow or is likely to contract. A severe, prolonged contraction is considered a depression.

Roughly 4 scenarios:1. Business as usual; this scenario follows from an environment of economic growth and resource abundance

2. Balancing the budget; this scenario follows from a regular economic correction in an environment of resource abundance

3. The long emergency;this scenario is envisaged when an economic correction takes place coincidingwith (or partly caused by) resource depletion

4. Green growth; this scenario can take place when the world has conquered the challenges of resource depletion and is able to realise (renewable?) economic growth

Scenarios in time:‘Business as usual’ is the scenario of the 20th century. ‘Balancing the budget’ is the situation we’re in since the start of the credit crisis, although some companies and sector already start to act according to ‘The long emergency’. Apparently the market is not in consensus about the future resource availability. To the extent resource depletion will become an issue more market actors will (have to) embrace sustainability, ultimately (hopefully) leading to a new equilibrium, which is called the ‘Green growth’ scenario.

Economic growth

Resource depletion

Resource abundance

Economic crisis

Green growth Business as usual

The long emergency Balancing the budget

Resource abundance

Peak oil kicking in Now

Economic crisis

Economic growth

??? Late 20th century

Resource depletion

What’s next? -3: long term scenarios

While many think and we’re in ‘Balancing the budget’ (and act accordingly), we’ve actually entered ‘The long emergency’

Business as usualThis is basically life as we know it. Especially how the baby-boom generation has known it. Prosperity, technological progress and individual fulfillment. Producers have few incentives to make lasting products, make smart use of inputs or promote energy efficiency. Social conditions are good in the North but not in the South.

Balancing the budgetCurrently, we are being given a taste of this scenario. Although the first signs of depletion have shown up in energy, food, land and ecosystems, we are still in an abundant environment. Albeit one that is in a severe economic recession, and possibly depression. Those who expect abundance to stay around, will try to sit out this period of high uncertainty. Companies and individuals will simply cut costs and postpone less vital investments. Sustainability will be approached opportunistically, as it’s of secondary importance, and not considered vital.

The long emergencyIncreasingly there is the fear or realisation that our economic model is running into the physical limits of our planet. In this scenario it is realized that sustainability and ethical behaviour are not merely laudable concepts, but that they are vital for our system - and the companies in it - to survive. Sustainability will be politicized, which is both an advantage and disadvantage. Advantage, because this will be a major driver for sustainable (including social) development. Disadvantage, because (geo-)political considerations are not necessarily in line with what should be systemic priorities. Further, as the economic situation becomes dire, governments can resort to extremer measures such as protectionism and even war. Individuals will seek security in building community.

Green growthIf resource depletion turns out be real, ultimately - and hopefully without too much human suffering and damage to vital human support systems - we can come to grips with the physical reality of our planet. In this scenario there will be some form of renewable economic growth, for our children to reap the benefits from. Sustainability will not only mean smart technology, it will also mean that some current practices such as shipping goods over the world limitlessly will seem a distant memory. Economies will be more localized, but probably under the all seeing eye of a heavily centralized government and an oligopolized production system, imposing green values while heavily ‘encouraging’ conformity.

(Temporary) equilibrium Enjoying the rideWorld government? GlobalisationGreen technology Technological progressZero waste Waste, waste, wasteConformity IndividualismRelocalization Consumerism

Seeking efficiencies Sitting it outRegionalisation Political uncertaintyResource wars R&D on holdGreen as survival strategy Sustainability on holdCommunity OpportunismProtectionism Cost reduction / efficiency

Resource depletion

Economic growth

Resource abundance

Economic crisis

‘The long emergency’: bye bye market-economy

In ‘The long emergency’ the shift will be made from a market-economy towards a managed-economy (=more drains)

Trends in governance:-Centralization (EU, WTO, Kyoto, UN, etc) as countermeasure to protectionism (consequence: less competition on policy level)

-Centralization is also: gov’t increasingly micromanaging all sectors of society (including your private life)

-Diffusion of gov’t and private sector (Gov’t becoming banker)

-Trade-off between privacy and security (privacy losing)

-Countertrend: tax revolts, social unrest, civil disobedience, liberty activism

Trends in the economy:-From consumerism to government spending as key driver

-Middle class shrinking, widening gap poor & rich (debt-slavery)

-Oligopolization (=breakdown on competitive forces): government determines who has acces to finance

-Countertrend: localized business & entrepreneurship

-Sustainability becomes a sine qua none

Trends in business:-Comply with gov’t policies (regulations, subsidies, credit lines)

-Focus on efficiency & reducing costs

-Technological innovation: energy, recycling, efficiency

-New business models: co-sharing, co-creation, opensource, peer2peer, etc

-Sustainability becomes integrated part of policy

Trends in consumption:-From spending to saving

-Seeking security in the broadest sense (physical security, but also mental: in human relationships/friends&family/community)

-Consumers becoming producers

-Focus on functionality as opposed to emotional benefits

-Seeking value for money / quality regains importance

How to profit from whatever scenario takes place

Again: removing drains in your community is a huge opportunity to create wealth while making the world a better place

Production[creating value]

Consumption[using/wasting value]

Saving[storing value]

Spending[exchanging value]

Borrowing/Debt[promising value]

Use savings to stimulate businesses within the community

Competition among currency systems

Democratize intermediation between savers and borrowers (decentralize the banking function)

Remove policy monopolies. Create competition on policy level by decentralization where possible (subsidiarity)

Buy products from local companies who you know, trust and can hold accountable

Borrow money to those you know and trust, and can hold accountable (e.g. www.mijngeldgaatgoed.nl)

Mobilize talent, creativity, time and energy for the benefit of the community

Produce and consume in a way that does not do harm to people and planet

•Shift all your attention, energy, spirituality, money, leadership away from the tapeworm towards building wealth for you and your community; in other words: make money removing the drains

•Build sustainable community based businesses: creating value taking into account the longevity and quality of vital human support systems, such as the environment and the society

•Build abundant wealth locally and globally with one proviso: do no harm

Where to start?

There are many things an individual/community/business can do to kill the tapeworm and profit from doing so

What I offer here is a paradigm and a methodology for detecting and removing the wealth drains in your community, taking into account the main trends in the outside world. How you define your community, what you consider a drain and where you see the best business opportunities is ultimately a subjective matter.

Described in generic terms, but largely based on Catherine Austin Fitts’ Solari model:

•Avoid co-dependent strategies: 1) fighting the system, 2) dropping out

•Organize: form a taskforce/investor circle with people you know and trust (goals & level of formality up to you)

•Study & education: the tapeworm, Dirty Tricks, how we feed it, how it drains us

•Withdrawing: “Coming Clean”, feeding local living economies, avoiding dirty tricks, earning ‘clean’ money & prestige

•Profiting: from a shrinking tapeworm, from growth in planetary wealth, seizing business opportunities

Resources for study & education [1]

There is no lack of resources to study the drains on your community’s economy and how to remove them

Websites / News / blogs Podcasts / documentaries Books / articles

World Events / understanding the tapeworm

Solari Blog

Cryptogon + Reddit

Globalpublicmedia

Engdahl Geopolitics/ Geoeconomics

Global research

Flashpoints

The Corporation

The Crash Course

The Yes Men

Walmart: high cost of low prices

Life and Debt

The Israel Lobby / Aipac

Iraq: Truth Uncovered

Big Bucks, Big Pharma

Enron: smartest guys

Economics 101

The Negative Return Economy

Dunwalke

Narcodollars for beginners

The Myth of the Rule of the Law

Killing Hope

The Secret Team

The missing money [2]

Crossing the Rubicon

Dark Alliance

Creature from Jekyll Island

Sustainable Community Based Business

Solari

BALLE

Relocalization network

Community Solution

Flashpoints / community business

Solari seminars

Coming Clean

Solari opportunity

Community Wizard of Sebastopol

(Post-) Collapse Globalpublicmedia

Post Carbon Institute

Lifeaftertheoilcrash

Oil Depletion Protocol

Navigating the falling dollar Post Soviet lessons

Closing the Collapse gap

Reinventing Collapse

Financial markets / the economy

Financial Sense

Nieuws-Flash Middelkoop

Financial sense

The Solari Report

Peter Schiff analogies

Freedom to Fascism

Money as Debt

IOUSA

Money Masters

In Debt We Trust

Maxed Out

Secret US recessions

Crash Proof

Resources for study & education [2]Websites / News / blogs Podcasts / documentaries Books / articles

Sustainable food / agriculture

Energyfarms

Organic Consumers

ISIS

Deconstructing dinner

The Meatrix

The Future of Food

The Power of Community

World according to Monsanto

Permaculture wiki

Jeffrey Smith

Energy Oil Drum

Energy Bulletin

ASPO

321energy

The End of Suburbia

A Crude Awakening

Hirsch Report

Media Freepress Outfoxed

The Revolution will not be televised

Orwell rolls in his grave

Manufacturing Consent

-What is the relationship between your local economy and other economic-, media-, political- and eco-systems?

-How to mobilize talent, creativity, time, energy and resources for the benefit of your community?

-How to use our pensions&savings to create finance structures for local business initiatives?

-How to protect your community from (inter-)national inflationary monetary policies?

-How to promote excellent leadership on all levels of government and business?

-How to incentivize ethical behaviour and prevent ‘bad’ behaviour by citizens, business leaders, government officials, public organisations but above all companies?

-How to ensure that the market mechanism is not compromised?

Coming clean

Coming clean means: aligning your principles and your actions

•Become inspired

•Explore / define your principles [create meaning/purpose in life]

•Switch media

•Optimize your time

•Be healthy

•Create a home / create community

•Optimize your finances [get rid of debt]

•Educate yourself

•Vote with your money and job

[adapted from: http://solari.com/archive/coming_clean/]

Who is my community?

Define your own community and design it to minimize external drains

You are part of several communities/community-like systems. It’s up to you which ones are most worthy of protecting. There are many real life examples of (sub-)systems designed to keep the value within:•local currency systems (e.g. LETS)•customer loyalty systems (e.g. airmiles, frequent flyer programs)•consumer labels (e.g. fair trade, eko / organic)•the local first movement:

Profiting from a shrinking tapeworm

Creating real wealth by empowering individuals/local communities instead of centralized institutions

Examples of tactics:•Cut out the middle man•Increase self-sufficiency•Cutting out time&distance•Cost reducing products&services•Recycling/smart use of materials•Demonetize and / or de-commercialize transactions•Mobilizing latent resources (e.g. elderly people, unused space, waste)

Example areas of opportunity:•Peer2peer financing. E.g. www.zopa.com , www.boober.nl •Open source / co-creation systems. E.g. www.mozilla.com •Decentralized/P2P food systems. E.g. www.odin.nl ; www.locallygrown.net•Community Supported Agriculture (CSA). E.g. www.vvhp.nl or www.localharvest.org •Urban Agriculture. E.g. www.everylawnagarden.ca •Decentralised, renewable energy. E.g. www.pedalpower.org•Energy-efficiency. E.g. www.happyshrimp.nl •Recycling. E.g. Cradle to cradle design or www.freecycle.org

The point is: it can be mainstream or niche, local or global, large scale or small scale, profit or non-profit; as long as it 1) doesn’t do harm, 2) empowers individuals & communities, and 3) reduces the drain from the tapeworm economy.

Synopsis

Now have another look at Eliot Spitzer’s quote and think of what a businessman, manager or entrepreneur could do to keep that money within the American economy:

"The federal government is sending each of us a $600 rebate.If we spend that money at Wal-Mart, the money goes to China. If we spend it on gasoline it goes to the Arabs. If we buy a computer it will go to India. If we purchase fruit and vegetables it will go to Mexico, Honduras and Guatemala. If we purchase a good car it will go to Germany. If we purchase useless crap it will go to Taiwan and none of it will help the American economy.The only way to keep that money here at home is to spend it on prostitutes and beer, since these are the only products still produced in US. I've been doing my part, and I thank you for your help”