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April 28, 2005
Trading Wars, Thur., April 28, 2005, 6:50 AM
As this is, I believe, an article of more importance than my average blog article, permit me to explain the background.
Twenty-five years ago, I decided to sell my computer-based management consulting and healthcare administration services company and join the then-powerful Commodore Computer as executive assistant to the CEO. I had been advising several computer manufacturers at the senior executive level, and one of my clients, Commodore, the maker of the Vic 20 and the Commodore 64, made me an offer that would have me travel the world with the CEO.
I accepted their offer and made the necessary preparations to join on January 2, 1981 in Pennsylvania. But, by a twist of fate, caused by a life-changing personal circumstance within my family, I backed out and took a completely different job in a different industry. I decided instead to accept an offer to join Dominion Securities in Toronto (now RBC Dominion) because (i) it would put me into a position of satisfying my life's passion, (ii) I was told I would soon be working directly with world-leading technical analyst Ian Notley, whose work I had been recently introduced to, and (iii) mostly because it was a job that would keep me close to my family, who needed me.
Understanding that background is important because I happened to say when I first observed the Trend & Cycle department computers at Dominion Securities, "With my understanding of fundamental investment analysis and economics, I could take this system to a Caribbean island and ‘beat the market'. It would be a competition of dueling computers."
This, in effect, was both an epiphany and a dream, which quite literally changed my life " and I hadn't even joined the firm or the industry yet.
Six years later I was building out 13,000 square feet of raw concrete space on the penthouse floor of the Toronto Stock Exchange as founder and CEO of the eastern operations of Canada's biggest non-bank-owned broker-dealer. And, I had convinced Notley to join me because that was part of my earlier epiphany-dream.
This morning I awoke early yet again to observe East Asian and European capital markets because I am anxious over what I sense are unusually important world events being played out. And it's all about money. In fact, I learned as a child that life is a matter of "economics first".
By that I mean simply money is the greatest motivator.
And then it hit me " the answer to my recent anxieties is that my dream of 25 years ago is finally coming to pass. We have entered into the age of the Trading Wars.
By that I do not mean Trade War; those have been going on for a couple millennia. I really do mean Trading Wars. But first, let me set the background.
In the past two centuries, America has fought and won the Industrial Wars, the Military Wars and the Trade Wars to be able to put itself into position as the dominant global power. But as the emerging economies of Eastern Europe, East and Southern Asia, Africa and Latin America are holding at least 90 percent of the world's population, and growing their economic output at a much faster rate than Western Europe and USA/Canada, that position of American dominance is being threatened.
So the game is now a competition of dueling computers, where the global capital wealth of the players is at stake, and where the players just happen to be the world's most financially powerful corporations, networked organizations, individuals and, most importantly, nations.
The capital markets game is no longer the typical portfolio management. It is no longer a case of using corporate securities as currency in the mergers and acquisitions game. Everything has changed.
No, today's competition in capital markets is all about winning enough wealth for society to create a nation that provides all that is desirable for its citizens.
The tools in the Trading Wars are the digital computers and programmed algorithms that carry out the struggle to win maximum share of total global wealth. This has been a world war thirty years in the making, and I think it is just about to start, sometime late in 2005.
In fact, I think the G-20 meetings of the world's most economically powerful nations is today making the final preparations in rebalancing currencies that will put each of the players into the most fair starting point.
And I believe that the Bush administration is trying to sell its Social Security plan because it knows that America needs to free up all its capital resources for the Trading Wars to come. Today in a nationally televised address, President Bush is going to tell Americans just why it is so important for them to take control of their own wealth, including social security.
Administration policy for the past five years has seen Americans top up their inventory of (i) homes, (ii) defense industry products (i.e., weapons), and (iii) money supply. The cost, as reflected by the lower USD, the higher gasoline prices, the much higher interest rates to come, and so forth, is obvious.
All that needs to be done is to learn the decision of the Chinese monetary authorities. And then the Trading Wars will commence.
These thoughts are just now coming to me, in fact after I awoke this morning, so I have not had any time to think them through for this article. But, I wanted you to be aware of what is on my mind, today, as the picture begins to take shape.
Posted by Posted by Bill Cara on April 28, 2005 06:51:47 AM | Category: Cara Today in the Market
Discourse
I am sorry Bill, they just sold the last tool!
http://cgi.ebay.com/ws/eBayISAPI.dll?ViewItem&item=5574815810
Posted by: Jim at April 28, 2005 10:59 AM [link]
And what happens in the Trading Wars?
Posted by: Movie Guy at April 28, 2005 3:23 PM [link]
Trade wars?
Our problem will be, no one will bother trading with us because we are a dead end market. When I did sales, the most eager customers were always the ones the furthest in debt.
So now our entire country is this way. We want to buy so badly...we won't go quietly into the night. We are the ones who will start WWIII out of sheer fury from denial of goodies.
Posted by: Elaine Supkis at April 28, 2005 5:19 PM [link]

that was an excellent observation
Posted by: tom at April 28, 2005 7:32 AM [link]