Faustian Weblog

I don’t know, but the similarity weirds me out…

I just came back from CES, I only have one word for those technophobes – Skype.

Everyone is going on about the death of the PC, the real story is the funeral services being held in the South Hall for the cell phone, and the SMS services. That’s right – cell phones are dying, soon to be replaced by Skype enabled devices. In ten years times, phone numbers and area codes will seem as antiquated as vinyl 33 records, or fat ties and bell bottoms. The hoopla between the Android and the IPhone is as irrelevant as the great struggle between Netscape and Microsoft before the advent of Google. The real technology story of the day is that Skype is fast becoming the communications platform of the world.

In Germany they have the Fatherland

In Russia they have the Motherland

In America we have the homeland

I have been buying shares of Shitty Bank – the symbol is C – which stands for Crap. Well as long as the crap is discounted, that is all that matters in a Faustian economy. Shitty Bank owns a $102 billion dollars of worthless credit card debt, all owed by Faustian deadbeats. A few months ago there was a car company with the symbol F – which stands for Found On Road Dead – and they did pretty well – I tripled my worthless dollars in six months. In the scheme of things, C is probably servicing F’s car payments as well.

I am going out on limb here but the Israeli/Arab conflict is nothing more than a contest between Jewish Nationalism and Arab Nationalism in the aftermath of the collapse of the Ottoman Empire. Contrary to the commonly accepted leftist view, the Jewish nation and the various Arab nations established themselves in the same historical period – that is between the two world wars. From a historical perspective, legitimacy is irrelevant. Over the next hundred years, this major conflict is likely to be replaced by a multi-dimensional series of minority based conflicts all over the Arab world. For this reason, I not only believe that Israel will prevail, but that it will actually thrive in the twenty first century – as one of the core stable nation states. In fact, it is more likely that there will be more Israel(s), not less of them, moving forward. Despite Al Qaeda’s rhetoric, the establishment of a forth Caliphate to encompass the old Abbasid Empire is dead on arrival. The reason is simple, the Ottoman Empire was never modeled as a centralized nation state to begin with; rather it was an autocratic regime that ruled over a patchwork of minorities – Arabs, Shiites, Persians, Coptic, Jews, Berbers, Yazidis, Chaldeans, Kurds, Turks, and Armenians. If one accepts the premise that the nation state is the ultimate stable entity that governments strive for, it is more likely that former Ottoman Empire will Balkanize further until equilibrium is reached. Indeed that is exactly what has been going on for the past twenty years. Armenia is now a separate country, following in the footsteps of Israel, which followed in the footsteps of Greece and North Africa a few centuries earlier. Of course, each conflict will entail further ethnic cleansing and further population displacements. As we speak, Kurdistan is now an autonomous region and will soon become a separately recognized country, at the expense of the Arabs who were living there. Over the next thirty years, we can expect Coptic Christians in Egypt to follow suit and the Berber populations of Morocco and Algeria to do the same. And let us not forget that the Shiite populations of Iraq, Syria, and Egypt might secede as well, especially if there is a democratic regime change in Iran and/or a collapse of the autocratic Mubarak regime in Egypt. How all this plays out is anyone’s guess. It is likely that the restoration of this region into one unified Fertile Crescent will remain a pipe dream that will fade as the populations of the region realize its futility.

* Nicotine increases alertness. This may enhance concentration, thinking and learning. This may be a benefit to people with schizophrenia whose illness or medication leads to cognitive problems.

* Nicotine can help relaxation, and it can also reduce negative feelings such as anxiety, tension and anger. So Nicotine may help people with mental illness deal with stressful situations.

* Nicotine might have an antidepressant effect. Nicotine stimulates dopamine production in part of the brain and so may help negative symptoms of schizophrenia, such as lack of motivation, lack of energy and flat mood.

* Nicotine may reduce positive symptoms, such as hallucinations for a short period.

* There is some evidence to suggest that Nicotine is associated with reduced levels of anti-psychotic induced Parkinson-ism.

* Nicotine can help to relieve boredom and provide a framework for the day.

* Nicotine can improve social interaction, something that may be of particular benefit to people with negative symptoms.

It would appear that there is yet another mutation to the Iraq Insurgency – the Qadiri Sufis. Like some new strain of the H1N1 virus that is supposed to prey on its distant cousin, this is yet another incarnation of Neocon stupidity. The Disney Land Empire – known as America – is going out of its way to promote a mystical brand of Islam in hopes of quenching the Saladin/Crusader narrative known as Al-Qaeda – which was promoted during the Reagan years as antidote to Communism. This is a mistake of monumental proportions. The Middle East is a Petri dish of firebrand cults, forever lacking the cleansing effect of a centralized nation state. The last thing on Earth we need to contend with is a Thelemic version Hezbollah. What these people need in order to truly pacify them are variable rate mortgages, flat screen TVs, and porn on demand – with a tinge of an Islamic Mega Church for nostalgia purposes. The only true answer to this dilemma lies in the nascent consumer paradises of Dubai and Jordan. To defeat radical Islam, one must first destroy the context in which its culture is relevant. We should be building Bedouin Casinos on the reservation with multi-media family tours of a virtual Mecca with consignment shops selling updated and abridged EZ-Korans printed China – illustrated for ten year olds.

Swimming pool
Boat
Plane
Castle in France
Horses
Opus Dei
Mormon Missionaries
Land in Jamaica
Italian Mistress
Special Needs Child
9000 square foot mansion
Pit Bull Terrier
Hummer
Beach House
Livestock
Problem Employees
Sales Guy
New Long Distance service
Windows 7.0
Illegal Aliens
Live in relatives
Pregnant teenagers
Exchange students
Organic wines
Nitrox and Dry Suits
Nascar
Kodak Stock

Frankly, I am getting tired of all these meta-narratives that try to explain historical events by some broader conspiracy theories. Although they may seem to logically hold together, they usually assume a purposefulness that is contradicted by the chaos and sub-optimality of the result these theories purport to engender. I am not specifically referring to such outlandish ideas as the 911 conspiracy that claims that the events on that day are the result of a secret cabal of military industrial fascists bent on gaining control of the world economy, while suppressing civil liberties, but rather the commonly accepted urban legend explanations that the invasions of Iraq and Afghanistan are about gaining control of the remaining world oil supplies, or as Michael Moore would stipulate about helping a rich corporate sponsor such as Unocal protect a profitable pipeline out of the rich Caspian basin, or even Howard Kunstler’s theory about building a police station in the Middle East. No, I reject all such narratives out of hand, as they simply try to explain incoherent secondary effects that no one, including the politicians or the press, predicted before the fact.

My own view is that history is the integral or summation of incremental decisions, which although casually related, fail to tie into a broader narrative that has any purpose whatsoever. And as the global order becomes more complex, each decision is more likely to be an incremental reaction to a previous decision, more localized in nature, and less integrated into a purposeful objective.

What does this mean practically? That the US invasion of Afghanistan was nothing more than a reaction to the events of 911. The US military had to be seen as “doing something”, so it invaded a country to satisfy this objective. End of story. From an Islamic perspective, these same events were nothing more than a reaction to the US military presence in Saudi Arabia after the first Gulf war on the part of Wahhabi nationalists who interpreted the US bases as a form of occupation by a presumed “infidel”. They resorted to terrorism because they lacked the resources to wage a conventional war. Once the US invaded Afghanistan, a new set of realities were put into motion, specifically the protection of US troops in a foreign and hostile land. This was not part of some master plan on the part of Bin Laden to draw us “in”, nor part of a sinister plot on the part of the US military industrial complex to gain control of the remaining oil supplies. If the US actually cared about its oil predicament, which clearly it does not with only 30 billion barrels of conventional crude oil reserves remaining, it would encourage conservation and maybe facilitate the construction of more nuclear power plants. The invasions of Iraq and Afghanistan were about short term political calculations, not about a genuine need to preserve an empire.

General McChrystal plan for stabilizing Afghanistan is primarily motivated by the need to protect US troops, which have been increasingly coming under fire for doing what they have been ordered to do i.e. occupy Afghanistan. He is also trying to clean up a situation that has been horribly neglected for the past eight years. The US military’s job is made easier if it can gather intelligence, which is made easier if it can trade protection services for information. All of this of course requires more troops, which in turn creates a whole new reality.

So what is really going on is a set of incremental deltas that is driving the agenda forward. Each delta in and of itself has an impeccable logic behind it independent of any long term desired outcome. Even the Karzai government, corrupt as it is, has had to make a series of Faustian decisions to stay in power, even at the cost of courting the enemy – the Taliban. A similar chain of events happened in Iraq, for different reasons, and with different outcomes. The issue we need to ask ourselves is whether this reality tunnel is where we want to be in ten years time, or in twenty years time. If the answer is no, then somebody at the top needs to make a purposeful decision – unpopular as it may be, which will eventually steer us into a different outcome.

Even though I support General McChrystal’s efforts and see in his actions a genuine desire to stabilize Afghanistan, I cannot help but think we have further ratcheted up the stakes in this Imperial Faustian game. Every step we take to bring order to the periphery, undoubtedly weakens us at the core through those insidious trade-offs of other roads not taken, other investments not made, and other markets not developed. What we need today is a forward looking leader who has the courage to cut our losses and not waste our resources on side shows that no matter how well intentioned will amount to little more than nation building in a third rate country.

“The days of paying for costly software upgrades are numbered. The PC will soon be obsolete. And BusinessWeek reports 70% of Americans are already using the technology that will replace it. Merrill Lynch calls it ‘a $160 billion tsunami.” Computing giants include IBM, Yahoo! and Amazon are racing to b the first to cash in on this PC-killing revolution.”

First of all nothing could be further from the truth. The PC has been steadily dying for the last 30 years. It the 1980s it was the workstation networked together in token rings that would kill it – who remembers Apollo and Sun? Then it was going to be the low cost X-terminal – what ever happened to that? In 1992, Silicon Graphics introduced the next generation 3D super computer called the Indigo – is that company still around? In the mid 1990s, Sun came out with Java – the network computing language – that was going to provide a gazillion free “applets” that would do everything from editing your word files to brushing your teeth. Fourteen years later, the language is about as popular as PL/1. Now the rage is Google Apps. Presumably, everyone is going to spend the next several years migrating all of their personal data, under their control on low cost PCs that they own, to some privately help corporate storage mechanism that will charge them for the privilege, sell it back to them at a cost, and threaten to delete it and/or sell it to another company unless they pony up more money. The reality is that computing has as much chance of becoming a utility as private transportation does – a mathematical function that tends towards epsilon in the long run. And you can write off the Linux PC, it will never happen; no one has the time to learn how to rebuild a Kernel. Sure, there will be Linux embedded devices, from music players to digital VCRs, but the hub will always be Windows.

Meanwhile the PC has slowly been conquering the world, replacing your stereo system, your phone, your TV, and sometimes even your spouse.

The simple truth is that the PC is like the car, we are just at the beginning of the computer age. It’s a personal device that is liberating to the extreme. In ten years time, there will be three times as many of them, and 80% of them will be upgrades over the current installed base. People will keep on buying them to get faster graphics, more memory, better applications, quicker networks, and smaller form factors.

The PC is here to stay, and MSFT is a good buy. And in twenty years time Apple will be still be running those goofy adds comparing their high end systems (around 5% of the market) to the ones the rest of us buy at Walmart.

In the long run, there are only two consistent reliable shorts in this business: Apple and Google. If past performance is any predictor on future events, whatever short term technological leads these companies have today will be commoditized tomorrow. And the company that will do it will be Microsoft.