Jamaica's History of Independence

Like any other country in 1929, Jamaica was experiencing a drop in its economic growth. The effects of this were starting to show in a decline of social conditions. In 1938 the labor riots were a turning point in the history of Jamaica and its independence.

The Bustamante Industrial Trade Union (BITU) was formed by Alexander Bustamante. This labor union was later to be involved with the Jamaica Labor Party. In 1938 Norman Manley, cousin to Alexander Bustmante, formed the People's National Party.

Manley led the country to Self Government and later on Bustamante became the first prime minister of Jamaica.

In 1944 Adult Suffrage was granted giving all males and females over the age of 21 to vote. The first election held under the Universal Adult Suffrage was held in 1944 and the Jamaica Labor Party won 25 out of 32 seats.

The Federation of the West Indies was started in 1959 and Jamaica was part of this group. A referendum was called to determine whether or not the people of Jamaica should remain a part of the federation. The people chose independence.

In January 1962, a draft of the Independence Constitution was brought before both Houses and after a full debate was unanimously approved. It was also agreed that the 300 year old Coat of Arms would be retained and the Latin motto "Indus Uterque Serviet Uni" changed to one in English "Out of Many One People".
At midnight 5th August 1962 the British Flag was lowered and the Jamaican Flag was hoisted for the first time. On the 6th of August 1962 Jamaica was given its independence. Sir Kenneth Blackburne was the last Colonial Governor and the first Governor General. Afterwards, Sir Clifford Campbell, formerly President of the Senate, became the first Jamaican Governor General.
Jamaica today is a great place to visit for vacation and enjoy the beautiful scenery.

America and her Economic Future in the World Economy, a Thought

It appears we are attacking ourselves in the United States and punishing our own team thru over regulation. We need to fix ourselves by becoming better at what we do, better than everyone else in the World. Just because Multi-National Conglomerates cannot make a huge killing over there every quarter is no reason to sacrifice our standard of living here. The European economies would like to be on the same page as us as far as a standardized Euro=Dollar, and that would be great, but not until tariffs disappear so we can make the stuff here too. Also what happens when we change our chess game for a weak dollar and then they restrict our goods to save their corporations and job base there?

We are different cultures and different political whims and the book Future Perfect sounds great, but there is a reality check on many of the notions of this type of game plan. Why choose a plan, have several plays ready to execute, ones which will not affect our middle class and job base. If we concentrate on quality, strength, innovation and have a great economy then entrepreneurs who built America can continue to find funding to explore new fields, and continue to hit milestones like Chuck Yeager did while we watched our technology break the sound barrier. Look at Intel, and Andy Groves vision, protecting our intellectual property and producing smaller, faster and more powerful chips exponentially. Do we need to weaken the dollar for companies like that? NO, we simply sell our wares a little cheaper in those markets, which require us to or we simply do not sell there. Is it the roll of government to decide that for us? By lowering our standard of living until the dollar reaches a lower rate against the other World Currencies? Especially considering that those other currencies are much less stable than ours and those markets may disappear at anytime if they collapse. Then is it up to us and the IMF to bail those economies out, when they fail to listen to reason, pollute the World, steal the money is and bow out gracefully when it is time to return the money? Look at this last round in Russia, 1/3 of the money to clean up the nuclear problem of Chernople, gone. Russian Nuclear Subs of the Arms Race Era docked in a muddy inlet, some on their sides. And the money given to clean it up, where did it go? They built a new fighter jet to compete with our newest. Why, not go clean it up our selves or just forget it? We may as well put to work America factories to build rockets and shoot them into the sun for fun. Or build devices to go on the back of cows to capture the methane to use as fuel to run steam generators to make electricity. Oh you know what? Just think about it yourself, we need a reality check in the real world; not a created reality that is not working.

What is a Recession Anyway?

Politicians and economists have debated the likelihood of recession in the United States for the past several months. As you know, the president and congress have enacted a preemptive stimulus package of tax rebates to minimize the effects of a possible recession. While the term "recession" is often used in public discourse, most Americans do not understand its definition. Unfortunately, that definition is elusive. There are two generally accepted descriptions of recession and they are sometimes at loggerheads with one another.

Moreover, one of those definitions is vague by design. The traditional definition of an economic recession is two or more consecutive quarters of negative real economic growth as measured by gross domestic product (GDP). The prediction markets use this definition. Of course, it takes time to compile comprehensive data. There are three separate iterations of quarterly GDP growth - two estimates followed by a "final" number. This final compilation is not released until nearly three months after the end of the quarter it measures. So far, aggregate economic growth has not indicated recession. The initial estimate of first quarter GDP growth was actually positive at +0.6%. A revision to this estimate is due out next week. Since 1961, The US government has recognized the National Bureau of Economic Research's (NBER) Business Cycle Dating Committee as the "official" arbiter of recession. This is a seven member group of academic economists. The NBER does not use any specific methodology for determining the start and end dates of a recession - instead it looks at a variety of economic indicators over various time periods and determines whether to declare that the economy is in a recession based on that data. Here is the NBER's official policy on recession:

A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.

The NBER is very deliberate in its assessment of the underlying data to avoid the need for revision. Its own policy is to wait "6 to 18 months" after the beginning of a recession to declare that one has started. In fact, they waited 20 months to declare that the last recession officially ended in November 2001! It is interesting to note the US economy actually never had two consecutive quarters of GDP decline during the 2000-2001 period. NBER committee members can complicate things by voicing their own views. They are not restricted as are government bureaucrats. Martin Feldstein, opined in March that his "personal view" was that the United States was already in recession. He reinforced those views just last week in declaring that this recession would be "severe". In contrast, Edward Lazear told a meeting of Wall Street Journal journalists that "the data are pretty clear we're not in a recession." Even the guys who are supposed to decide what a recession is cannot agree.

Meanwhile, the economic data offers a glimmer of hope. The US trade deficit is falling faster than anticipated and this will likely spur anupward revision the 1st quarter GDP due outst quarter was that "the data are pretty clear we're not in a recession." Even the guys who are supposed to decide what a recession is cannot agree. Meanwhile, the economic data offers a glimmer of hope. The US trade deficit is falling faster than anticipated and this will likely spur an upward revision the 1 next week. The consensus of economic experts now is that GDP growth in the 1 actually +0.9%. Monday's release of the Leading Economic Indicators for April was also positive as it evidenced mildly improving conditions- the second consecutive monthly upswing. In an election year with anemic growth, the labeling of the US economic condition will take on urgent meaning. This will put the NBER's business cycle dating committee to the test.

Understanding Economic Cycles (Business Cycles)

Definition from Wikipedia.org.:The business cycle or economic cycle refers to the fluctuations of economic activity about its long term growth trend. The cycle involves shifts over time between periods of relatively rapid growth of output (recovery and prosperity), and periods of relative stagnation or decline (contraction or recession). These fluctuations are often measured using the real gross domestic product. Despite being named cycles, these fluctuations in economic growth and decline do not follow a purely mechanical or predictable periodic pattern.

The economic clock is a simplified approach to understanding our position as to the health of the ecomony. It also assists to identify the best performing market sectors in elation to the growth area of the economic cycle. Keep in mind that the there any number of random influences that effect the economy such as wars, natural disasters and the like that sway the cycle and effect the transistion. It wiil never be a perfect cycle and should only be used as guide to assist with investment decisions.

The above example is very simplified version of economic expansion and contraction. The Economic Cycle Research Institute or ECRI http://www.businesscycle.com earn a living from analysing the economy and providing detailed information on the health of the economy by way of specialized indicators from various economic sources. These indicators are complied and the result is some of the best leading index indicators for picking turning points in the economy. One indicator we follow is the Weekly Leading Index or WLI.

It is worth visiting the website http://www.businesscycle.com/about/approach/ to get a better understanding or read the book

Beating the Business Cycle: How to Predict and Profit from Turning Points in the Economy, by Lakshman Achuthan and Anirvan Banerji, New York: Currency Doubleday, 2004.
In Martin J. Pring's book, The Investors Guide to Active Asset Allocation, 2006. He describe the bussiness cycles in six stages, where:

o Stage 1 - only Bonds are bullish;

o Stage 2 - Only commodities are bearish;

o Stage 3 - Everything is bullish;

o Stage 4 - Bonds begin a bear market but stocks and commodities remain bullish,

o Stage 5 - only commodities are bullish) and Stage 6 - Nothing is Bullish

Martin is a well respected market analyst and commentator and in his book he clearly describes the intermarket relationships between the major markets and how they are intrinsically tied with each other. The flow on effects of each cycle then affects the corresponding business sectors expanding or contracting business in each of these sectors.

2009-2010 Inflation (Or Hyperinflation)

In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time.The term "inflation" once referred to increases in the money supply (monetary inflation); however, economic debates about the relationship between money supply and price levels have led to its primary use today in describing price inflation.

In economics, hyperinflation is inflation that is "out of control", a condition in which prices increase rapidly as a currency loses its value. Formal definitions vary from a cumulative inflation rate over three years approaching 100% to "inflation exceeding 50% a month." In informal usage the term is often applied to much lower rates.

I think a lot of things will be much higher in price, including oil, next year or maybe later this year. But, don't confuse price with value.

If there is any economic recovery globally and the dollar is falling, we could see any possible price you want to imagine but, it would be in dollars, and not other currencies.

There are several analysts that are predicting a large drop in the dollar and that will even give the markets a boost. Using an extreme example, you could see DOW 50,000 by the end of the year if the dollar gets dumped but, while you would have seen over 40,000 more pts. you couldn't buy any more at 50,000 than now, if you sold it and probably a lot less.

The price of the DOW doesn't reflect value, just price. Oil is the same. If there is a recovery globally, oil demand will rise and with all the supply being cut now, it will cause oil to go back up for all nations but, if the dollar is falling, even if they don't pay more, we will. We could pay $1,000 a barrel or $10,000 a barrel or $1 million a barrel as that is what happens when a currency collapses.

For those who say that would crush our economy. Correct 100%. That too, is what happens when a currency collapses. The world basically moves on without you.

If that happens to the U.S. then the world will move on but much slower than before. Because we are such large consumers there is good news and bad news in that.

The countries that move on would find fewer buyers but, also less demand for copper, oil, steel, concrete, etc. and thus, they could still have profits even with fewer exports. They may not be large for years but, there are two sides to U.S. consumption. It drives up both the price of goods and the price of things to make goods with when we consume a lot.

Peter Schiff goes as far as to say the world's exporters would actually be better off without us increasing demand for raw materials so much due to our consumption.

However, just as it takes a depression for us to go from debtor nation to creditor nation, it will take a global recession at the minimum to go from a global economy dependent on us to one that isn't.

Consumption is touted as this big "cure all," but, it isn't. Production and making things faster than debt rises, is the cure all. Spending less than you earn, saving so you can spend in down times, budgeting, and sensible investing vs. "gambling" on stock moves is the "cure." Less government, not more, less government spending, not more, fewer programs not more at the federal level is what we need.

If we aren't already there then soon we will be more of a drag on the global economy than aid to it. Peter Schiff, if not right now, soon will be.

Think of it this way. You make things. I buy from you but, to keep buying from you, you have to keep loaning me money from what I pay you. To make it worse, I pay you back with devalued money so that you are even losing buying power with every new loan to me.

How long are you going to keep selling to me? You end up better off making something else and selling to somebody else or just making the stuff for "trade" and "sale" with people you buy your raw materials from.

In the last couple of years, one oil nation, Venezuela has done just that. It "trades" some of its oil instead of selling it for things it needs from nations that don't want to "buy dollars" to buy oil with and that have materials that Venezuela needs.

Iran stopped using dollars, too. It even got Japan to buy the oil it gets from Iran in Yen as well as sell in euros to other nations.

In short, there are no certainties going forward except that we have to change the way we run this nation from top to bottom.

Should You Start a Business During a Recession?

I say a resounding - maybe. Regardless of all the bad news spewed out in the media versus all the contrarians telling you to sink everything you have into marketing because nobody else is and you will get market share, it's not that cut and dry.

I suggest you stick to your plan of starting the business. HOWEVER, now more than ever, you should keep your day job.  It's not time for experimenting. If your new venture starts to succeed with part-time results then you could keep shifting your emphasis in that direction. But what if you don't see any results? Is it because you don't have a good idea or a good product? Is it because the economy is slow and nobody's buying? Or, are you in an industry that is not "recession proof" and one that ebbs and flows with the general economy?

What I am saying, is that it's difficult enough to run a business and gauge its success during normal economic growth cycles. Don't put yourself under undue pressure when you don't need to. Recessions are called that because business recedes to a lower level. That being said, there are some businesses that actually do better in a recession and there are some products that people still have to have. Collection agency is one of the first businesses that come to mind. Discount or coupon related marketing are another. And people always have to eat; just maybe not at a restaurant.

There are some things that you can do during the downtime to help you prepare for the time when there is a better business climate. Here's a few tips:

Network more. Find people who would be great for your company when you start hiring. They may be looking for a job then. Also, go out to lunch with an entrepreneur. Ask them what they are doing to keep their business growing during the economic downturn.

Purchase products you know you will need. Typically, in a recession, prices come way down and there are some bargains to be had.

Keep learning. You have more time to use to your advantage. Use it wisely. Increase your learning effort on all aspects of your business, including studying your industry and your competition. I don't advocate spending a lot of time being obsessed with your competition, but in this case time is on your side and not theirs. Perhaps they might want to get out of a part of their business and let you take it over. Sometimes, if the timing is right, a business will be happy to let go of a product line or group, just for taking over the expenses.

We Miss the Eloquence and Logic of Milton Friedman Now More Than Ever

One of the signal economic thinkers of the 20th century was the Nobel Prize winning economist Milton Friedman. His many books and papers, interviews and television specials have left us a valuable trove of thoughts and observations that should serve as guideposts during our current difficult economic times. His death has left a void that no contemporary thinker has been able to fill. That is most unfortunate, especially now.

Recently, I revisited my copy of Professor Friedman's signature work, Free to Choose. It is still as pertinent, fresh and poignant, as it was the day it was first published. His reasoned defense of economic and personal freedom, strictly limited government and the rule of law need to be reviewed and protected fiercely by each citizen that values these sacred rights.

"Thank heavens we do not get all of the government that we are made to pay for", stated Professor Friedman in one of his most oft quoted observations. The simple, but powerful clarity of these 17 words serve as testament to the deep understanding and concern he possessed about the ever-expanding role of centrally planned, distant government and the excessive price we pay for it. We see the detritus of insatiable government in every aspect of our lives, and yet, we seem incapable of slowing, preferably stopping the rapid growth of this corrupt, inefficient monster.

The Federal Government is nearing a 3 trillion dollar annual budget. No one really knows the exact amount of deficit spending we incur each year, but it is massive and growing. The more revenue the government realizes, the faster spending increases. We have un-funded liabilities of somewhere around $53 trillion for Medicare and Medicaid, and $25 trillion for Social Security. These are just estimates; no one can state the absolute accurate numbers. And, remember the government refers to these obligations as "un-funded liabilities", not debt as private citizens and industry would be required to report and account for.

In 1976, President Jimmy Carter created the Department of Education. Before then, education was largely a local affair. This boondoggle has grown massively since its inception in employees, budget, programs and un-funded mandates. Less than 7% of the $60 Billion annual budget for the DOE is returned to state and local schools as grants. The rest is consumed in "bureaucracy heaven". Can anyone seriously argue that public school performance has improved since we were blessed with the Department of Education and the thousands of theoreticians, consultants and knowledge brokers that this cesspool supports? You can actually graph the decline of graduation rates, the increase in truancy, lowered standardized test scores and achievement tests from the date we were blessed with the DOE.

The government enjoys natural monopolies in many areas. The Postal Service, the Passport Office, AMTRACK, The FAA, and so many more government agencies provide we citizens with one stop shopping. In every case, the result is subsidy, waste, and mismanagement. Waiting up to 90 days to receive a passport is ridiculous. The Postal Service and AMTRACK require subsidies every year, while FedEx, UPS, and the railroads make billions of dollars in profit each year. Why would any thinking person believe that government should be expanded into even more areas of our lives.

Thomas Jefferson, a soul brother to Milton Friedman said, "He is governed best who is governed least". And yet, an ever-growing segment of our citizenry constantly seeks to redress perceived grievances and personally poor decision making by petitioning politicians for outcomes favorable to their desires. We know with absolute certainty that government is too large, inefficient, duplicitous and wasteful to solve problems.

Government is not in business to solve problems: it is in business to institutionalize problems! Social Security, Medicare and Medicaid, Welfare, Food Stamps have all grown exponentially. The problems these programs, and many others, were supposed to address have grown even more exponentially. Bureaucracies are not in the business of solving problems and shrinking, then going out of business as they successfully complete their mission. The very core of the nature of a bureaucracy is to grow insatiably.

As more citizens abdicate their personal responsibilities and seek government support, there are all too many politicians, lobbyists, issue advocates and social engineers ready to comply and satisfy this sycophancy. We see many people campaigning for a government takeover of the health care system. When government provides free health care: that is when health care will get really expensive! How in the world can so many people, be so blind about so much.

My Company provides consulting services to inventors, small businesses and entrepreneurs bootstrapping businesses. By their very nature, these people are fearless, independent, creative and driven. They seek to take advantage of the amazing opportunities available to every citizen of the United States, if only they would take advantage of these possibilities. To a person, successful entrepreneurs do not understand, and usually despise government dependency. Simply being a citizen of this great country is the equivalent of winning the geographic lottery.

President John Kennedy famously stated, "Ask not what your country can do for you, ask what you can do for your country"? The growing sentiment today seems to infer, ask not what you can do for your country; ask what your country can do for you? John Kennedy, Milton Friedman and Thomas Jefferson are symbolic personages of a sentiment that must be revived. Every citizen must contribute to the public good, but the government must get out of the way and let the populace live and prosper by the dint of their own efforts. Downsizing this albatross is in order, and quickly!