The truth will set you free, Lance?

Lance Armstrong is right that the truth will set you free, but what will it free him of?

No more money

First, it should free him of his money. All of it. We have a range of laws that require people to be recompensed for wrongs done against them and the list of those who have been wronged by Armstrong is very, very long.

As he is an American, those who have been wronged won't be bashful in suing him to get their rightful money back. By the time it is all finished, there shouldn't be any money left of his fraudulent wealth. 

Trust and relationships

The truth also sets him free of any trust he has in most of his close personal relationships. His children and family will never trust him.

It won't matter what he does or says or how long he does it for, that trust will never return.

Many of those relationships are gone forever. They will never return. He is free of them. 

Lance as you knew him is gone

Lance, you are still delusional if you think people will forgive you. If you want the truth to set you free, you need to let go of the entire lie that your life has been. 

That means not expecting anyone to forgive you. It means going to jail. It means accepting that you are not who you thought you were, and tried to show other people you were.

This really would set you free. If you leave the old fake person behind. 

It won't happen.

My bet is that most of this won't  happen. Lance won't tell the whole truth. Lance won't own up to his deceit to himself. Lance will keep trying to spin a story. Lance will never be set free. 

But I do hope he goes to jail. We need justice in our world for the rest of us to retain our trust. 

Let me know what you think?

Mark S

The end of get-rich-quick schemes (for now)

The last 20 years has been pretty unusual.  There has been a lot of opportunities to get rich quick (or get poor if you messed up). There was the Internet boom and bust, a few stock market booms, rising house prices, rising commodities prices, low unemployment, a housing boom and huge wages for mining workers.

Source: Reserve Bank of Australia

So, whether you were white collar or blue collar, there have been plenty of ways to get rich if you took a few risks.

It's over!

Back to the old days - do things that people want

What is going to happen now is simple. If you offer products or services that people want, they will be bought, at a fair price. If you are a healthcare worker, there is a lot of demand for your services - you will be able to get work and charge a fair price for it. If you are a manufacturing worker in Australia, there is less demand for your services.  You will need to be one of the best manufacturing workers, or reskill, or do something different.

More importantly, as a society, we need to think about what people want, and create those products and services.  Before mobile phones, few people thought that having a mobile phone would be a necessity. They were a luxury item.  In hindsight, we can see how useful they are, and mobile phone companies have done very well.

Before the washing machine, the idea of having a mechanical way to do laundry wasn't obvious. But once the washing machine was invented, every washing person (mainly, women) wanted one. (Watch Hans Rosling's great talk for more on this). And increasingly, we are happy to pay for the services of others to do other cleaning for us.

What happens next?

Now, it is up to us, to identify what the next washing machine is.

Ask yourself, what do I want? What does my neighbour want?

Ask yourself, how can I do what I already do better, faster, more effectively?

Ask yourself, how can I "sell" my great services better.  I know that what I offer to my firm, or my customers is valuable.  I need to communicate that value better.

Every transaction has to offer value to both sides.

Ask yourself, am I doing something that nobody wants or needs any more? If you are handwashing clothes, while everyone else is using a washing machine, sooner or later, your customers will politely stop paying for your services.  Make sure that you keep up with the times.

We will get wealthier as we continue to be more productive

By doing all of these "normal" things, we will get a little more effective every day.  Our incomes will grow a little every day, and our standard of living will grow a little every day.  It won't be a get-rich-quick scheme.  The improvements will often be so small that you won't notice it - much like healthy eating - one day you look back and realise that you have taken off weight.

So, in 2013, let's all get rich moderately quickly.  Let's all try to do just a little bit better in what we do, or change what we do and choose something different. When we all do that, we all benefit.

In 2013, let's be innovative, productive, and creative.  By the end of the year, you will notice the difference.

Let me know what you think

Mark S

Loving in Japan

Greetings from Tokyo. 

One of the interesting things about being in a different place is that different social norms and customs generate a commercial requirement for different types of services. 

Many single people in Tokyo live in small studio apartments, not much bigger than a student dorm room. They choose to do this to have personal privacy rather than to live in shared accommodation like many inner city dwellers in Australian cities. 

You can hear your neighbors! You need a love hotel. 

So you are single in your 20s. You pick up at a bar. You live in a dog box with clothes hanging from the ceiling and not enough room to swing a cat. 

You aren't going to impress your new friend at home, and with some enthusiastic intimacy, you will break a whole bunch of rules with your neighbors. 

What do you do? Go get a room. And thankfully, a whole industry called love hotels will rent you a really nice room for a perfectly decent price for either 3 hours ($40-50) or overnight.

Where are these love hotels? Right around the corner from the nightlife districts. It's a great example of the market delivering supply to satisfy a need. 

Let the market do its job - there is so much we can learn from other countries

The worst abuse of statistics by Rev Peter Jensen

Tonight on Q and A, we witnessed one of the worst abuses of statistics - and it causes real harm.

A correlation is not causation

Peter Jensen - you sinned by misusing statistics

Anglican Archbishop Peter Jensen asked for a sensible debate about the health issues of being gay, on the basis that gays have shorter lifespans on average than non gay people.

This is the most heinous misuse of statistics.  A correlation (when two things coexist at the same time) does not mean that one thing causes the other.

Observe the following facts:
- People who live in Africa have a shorter lifespan than people who live in Australia
- People who are overweight have a shorter lifespan than average
- Men have a shorter lifespan than women
- People who are gay have a shorter lifespan than average
- Indigenous people have a shorter lifespan than average
- Smokers have a shorter lifespan than average

Does this mean...
- Africans are genetically weaker?
- If you are overweight, you should lose weight to live longer?
- If you are a man, you should become a woman to live longer?
- If you are gay, you should become straight to live longer?
- Indigenous Australians are at fault for their shorter life spans?
- To live longer you should stop smoking

Clearly, some of those statements are nonsensical, some are provocative, but they are all equally plausible (or implausible) from the data.  None of them should be stated without more facts.

What is really going on?

• Africans and indigenous Australians have a poorer standard of nutrition, water and healthcare among other things.  It is these things that cause shorter life spans.  The reasons that these groups and others around the world have these conditions is complex and varies from location to location.  However, this does not means that Africans or indigenous Australians are at fault for their shorter life spans.
• People who are overweight, and men have a higher risk of certain conditions which end your life.  Diabetes and heart failure are two of these.  Would losing weight reduce your risks? Yes, controlled studies have shown this.  Would becoming a woman reduce a man's risk? Who knows - there have been insufficient studies of transsexuals to evaluate?
• Gay men live on average shorter lifespans than average.  Why? There are a myriad of possible factors including higher rates of mental illness, which does shorten life spans.  Why do gays have higher rates of mental illness? There are many contributing factors, but the suggested solution that gays should try to not be gay is more likely to increase mental illness than decrease it.

• Smokers have shorter lifespans, because smoking increases the risk of lung cancer.  Lung cancer will end your life.  Therefore: smoking - causes - lung cancer - which causes death.  This is the only one of these statements that is a proven causation.

Misuse of statistics is not an accident

Peter Jensen, you are a learned man.  You studied the rigorous discipline of law, you have multiple degrees.  You know the difference between a correlation and causation.  You know that you are being deliberately mischievous when you were asked to comment on Jim Wallace's quote that included...
"The life of smokers is reduced by something like seven to 10 years and yet we tell all our kids at school they shouldn't smoke...But what I'm saying is we need to be aware that the homosexual lifestyle carries these problems..."

He is trying to argue that there is a causal relationship between both smoking and death and a gay lifestyle and death.  There is a relationship for smoking.  There is no relationship for a gay lifestyle.

You know the difference Peter Jensen.  You know.
 

Peter Jensen, your knew your comments would get traction. You misused statistics deliberately.  That is sinful. Christ would not have done that.

A solution to the foreign sale of Australian farms

The emotional and political debate about the sale of Australian agricultural assets, particularly to Chinese interests,   needs a more objective perspective. 

Two types of assets

Cubbie Station - a political football

What is an asset like Cubbie Station?  It's actually two assets. One is the land and resources under the land. The second is the right to produce food or crops from farming. 

This isn't just a technical point, it's critical to the security of Australia and to the debate. 

Separate the assets

A lot of the debate quite rightly surrounds the ownership of large tracts of Australia by foreign owners, especially foreign governments.

There is also acknowledgment that Australia lacks the capital and commitment to farm our arable resources to their full capacity. So, we need to work with foreigners to make productive use of the land.

So, we can lease the asset, rather than sell it. 

The UK model

For centuries, the UK property model has sold long term leaseholds over residential property.  If you "buy" a flat you are most likely buying a 90 year lease, not the freehold. 

We should adopt this model for significant Australian agricultural landholdings. Sell a 100 year lease. It provides food security for the Chinese buyer, but does not relinquish the ultimate ownership of the Australian land. 

Selling long term leases of Australian agricultural properties is a win-win for all. 

Let me know what you think. 

Mark S 

Happy Carbon Tax Day

So, today was the first day of the Clean Energy plan, highlighted by the introduction of the carbon price on major emitters.

There are 294 companies to pay the tax

So, let's set a couple of things straight.  There are 294 liable entities for the 2012/13 who have to pay the carbon tax.  No, it isn't 500 companies as been widely reported.  It's just 294.

Most of them are involved in energy or mining, plus a number of councils who operate landfills.

Hardly any impact on the average person

How is this going to affect the regular person? Well, some prices will go up, but the average person will be compensated, so there will be very little impact.  In fact, many people will finish off better off.

Given that prices go up and down for various reasons, it will be very surprising if the carbon tax impacts are as noticeable as the GST.  It isn't as if prices will suddenly go up by 2% this week.  Instead, companies that have to pay the carbon tax will carefully consider their pricing, and will make decisions as to whether they will pass the price on.

Companies that increase their prices will risk losing customers, so that is quite a disincentive. And given the level of industry support, there is a good chance that many won't shift their prices, at least not straight away.

So if people won't lose and companies won't put prices up, how does this work?

Just to clarify, there will be some price rises.  But, the real way that the carbon tax will work is to penalise companies that pollute and advantage those that are clean.

Very quickly, capital will move towards the green companies (we are already seeing that happen). And the big energy companies are accelerating their green programs.

Dirty coal plants like those in the Latrobe Valley will be phased out, and workers in those plants will transition to other jobs.  Some will stay in the energy industry and others will do something different altogether.

Economists call this the productive use of resources. I call it helping to get workers out of dead-end industries.  There are hardly any blacksmiths any more, and that's because there are a lot less horses being shod.  In a few years time, there will be a lot less brown coal workers, and that will be because we will have weaned ourselves off brown coal.

Any change is contentious and emotional.  The carbon tax is a good change.  Time will show this to be true.

Let me know what you think

Mark S

P.S. Check out the http://www.cleanenergyfuture.gov.au/ website for more information

Why can't we see that life is still very good?

We don't know how good we have it.

We Australians have a very good life.

The fundamentals of the Australian economy are very good.  Most people have a job.  Businesses are still profitable. Health care is the best it has ever been.  The quality of our food is high.  So why is there a pall of gloom hanging over us?

We compare ourselves to what we had 

Rightly or wrongly, humans evaluate our state in terms of gains and losses. Rather than looking at how wealthy we are or how much food we have, we instinctively assess whether we have gained or lost.  During the mid 2000s boom, most people had more money (even if a lot was on credit), jobs were very easy to get, asset prices were booming and confidence was high. 

Now, everyone feels like they have lost (unless you are one of the small number who work in mining).  We are all a little behind what we were at the peak.  Oddly, although our logical brain knows that Australia is in a strong position, and much better than the rest of the world, our emotions win the day. We feel the losses. It is those feelings that dominate. 

Unfortunately, our emotions then have a big say in our decisions. Our logical brain says "everything is fine - we have plenty of money, just not as much as 2008".  Our emotions say "look at how much money we have LOST. Let's batten down the hatches."

Sentiment then feeds off itself 

Once the emotions win the battle, the negative feedback turns into reality. People stop spending. Businesses start failing. People lose jobs.

Job hunters queuing for 50 jobs at London Zoo

We can override these emotions. We need a different frame of reference. Rather than comparing to the past, we can compare to other benchmarks. We can compare ourselves to the British or the Americans. These are western nations that we can relate to. 

We need stories comparing the average Briton, or American to the average Australian. We need to see our current state as a WIN not as a LOSS. 

If we don't do something quickly to defeat our emotions, they will make our very fears a reality. 

Let me know what you think

Mark S