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A Mindset for Problem Solving…going forward!

March 26, 2013

Today, we have so many problems that are getting more serious daily. At some point we all need to develop a mindset for solving problems and developing a New Model for Economics. What are some principles that would help us with solving the coming colossal and growing number of economic problems? The below concepts have been tested over time and have proven to be successful for problem solving:

1. Understand the Situation:  Our economic problems are developing from the Situation which has evolved (mostly since the closing of the gold window in 1971). This event, called the Nixon Shock, set in motion a new paradyme for economics globally. The other issue is the philosophy which we call Keynesianism. This philosophy (model)  started some time after the last Great Depression (1929-1937) and has become embedded within our economic system globally. We need to understand that this model is a Debt Model which has now run its course. We all witness the unsustainable Debt which has been accumulated on the books of consumers, investors, and our Local, State, and National governments. We now recognize that this Debt is unpayable and must eventually be liquidated via a difficult deleveraging/defaulting process (over many years). That is our Situation today!

2. Understand the Problem:  Our economic problems are obvious to those of us who understand our prior Situation. Our money is now digital and created ‘out of nothing’ by our Central banks. Values and Prices are now being manipulated by our Centralized Policymakers to give the appearance of growth and stability. In reality, however,  distortions in ‘prices’ and ‘values’ have reached unsustainable levels. At some point in the not too distant future this bubble of Debt, Deficits, and Manipulated Asset Values must revert to the mean (this means defaults, liquidations, and a general collapse of all ‘values’). Keynesianism is a ‘one way street’ which allows more Debt to accumulate until a ‘threshold’ level is reached. We now witness this ‘threshold’ level  in Europe and all the Western economies. The end game is upon us! Our problem is obvious to those who have understood the history of Keynesianism over these past 40 + years.

3. Develop a Viewpoint after understanding the above:  Our Situation and our Problem leads us to a Viewpoint about all these issues. My personal Viewpoint reveals that we need a total overall of all our economic principles. We need a new Viewpoint on ‘money’. We need a new Viewpoint on Debt. We need a new Viewpoint on the size of Government. We need a new Viewpoint on how to transition from our current situation/problem to a New Economic Model for our planet. We need a new Viewpoint on ‘freedom’ for the people on this planet. And we need a new Viewpoint on how we desire to live our lives going forward. Do we desire a Global System for this planet? Do we desire a Decentralized System which allows more individual freedom? Does the World Community desire a Centralized global banking System? How should our global natural resources be used and distributed? Is it now time to re-think all our past economic principles so that a new global economic Model can be developed? Our Viewpoint will emerge from understanding our Situation and our Problem.

4. Develop a Methodology which is logical and practical:  Once we understand our Situation, Problem, and have developed an informed Viewpoint, we can work on a Methodology that fits these decision-making principles. Any Methodology needs to lead to a solution that fits the Situation. For example:  If the problem is the nature of money and value, we need a Methodology which leads to a decentralized monetary system where the marketplace is Supreme. Central control over money and value would be anathema. Free market solutions lead to decentralized options for our economy and political system. If the problem is excessive Debt, then we need a Methodology which eliminates Debt from our economic Model. Debt is anathema for any New Economic Model. Our thinking is important when we work to develop a New Economic Model. We need to recognize that we all live in the present moment (now). Past and Future are merely concepts derived from the present moment (our life in the now moment). Methodology will encompass all these and more!

5.  Adopt a Premise that is realistic:  After understanding the Situation, Problem, Viewpoint, and Methodology, we need to adopt a Premise (based on specific and realistic Assumptions). Keep in mind that any Premise is based on uncertain Assumptions. Assumptions, however,  are the most important aspect of our thinking model. If any Assumption changes then the entire results change and our Conclusion changes. Problem solving is a Dynamic Process which is based on Assumptions (developed in the now moment). We need to keep in mind that reality continually changes as we live our lives. This means that all Problem Solving needs to be Dynamic and open to change continually. There is no fixed or static reality in our Universe. Reality is constantly changing and this means that all Problem Solving needs to be dynamic and open for change. Our Assumptions are key to any new decision-making model!

6. Review all Assumptions continually:  The above steps seem logical and practical for all our problem solving issues. Keep in mind that these principles are a model to help with decision-making. Today, we have mostly Centralized decision-making and problem solving by a few elite policymakers. This model leads to manipulation and control over the dynamic process within the marketplace. Also, all the Assumptions today are mere numbers plugged into an economic algorithm. This is not a viable formula for solving our economic issues going forward. We now need a New Economic Model which allows input from everyone within the marketplace. This demands that our Model be decentralized, dynamic, changing, and open to everyone. Our Premise is based upon our Assumptions…and our Assumptions lead to our Conclusion. The key words in any New Model are the principles above. This Model should lead to better results for the entire marketplace!

7.  Derive a Conclusion that is logical, reasonable, and practical:  After considering the above principles, we need to derive our Conclusion. This conclusion follows naturally from the principles above. We need to recognize that any Conclusion is tentative and subject to change over time. The above thinking model is dynamic and allows for continual change and update. The key factors that are important for any New Economic Model are personal freedom for the people who must create our Wealth and Prosperity going forward. This means that our New Economic Model must focus on a Decentralized System (where every person can provide input and assumptions). Today’s Model is Centralized and Manipulated by a few elite policymakers. Central Banks and their real-time manipulations have destroyed real Capitalism and Freedom for the many.

Our economic System today is gradually collapsing and crashing from the excesses of the past. This means that today’s Centralized Model is outdated and obsolete for our future. We now need to recognize that our World Economic System is in Transition. The new World Wide Web and the inter-connectedness of all Nations has created a New World going forward. This New World will require a New Economic Model that is realistic, practical, and dynamic for the entire planet. Now is the time to start thinking about a New Economic Model for our planet. The above thinking principles seem very relevant for any New Economic Model. Give these thinking principles some thought at your leisure. I am:

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