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Network Propositions
700 - 799

Cities will become more violent and the quality of city life will fall. There will be some movement of population from the cities to the country.

There will be a significant increase in the number of commune-type rural settlements. Benefits of membership will include healthy and simple life-style; good rural environment; food self-sufficiency; low rent; sharing of skills; friendship and companionship; common interests and beliefs; and group security.

Policing will tend to become more local in character.

Local communities will supplement their paid police force with unpaid citizen auxiliaries.

Business property owners will organise rostered patrols, in cooperation with local police.

Central (headquarters) police authorities will delegate greater powers and flexibility to local police ... particularly with regard to local initiatives against crime, involving combined, cooperative actions involving local societies and local police.

The proportion of youth-crime to total crime will continue to grow.

On-the-spot justice will be meted out more frequently.

Unofficial 'muscle' will be used to an ever increasing degree.

The cleavage between law-abiding and law-breaking sections of society will deepen and widen.

The enclave (and patrolled perimeter) development will create a pale condition, where areas 'beyond the pale' are lawless. Societies are presently in transition to the pale condition.

In cities and towns, schools and other public buildings will tend to be located in patrolled enclaves and secured against arson and vandalism.

In nearly all countries, police will carry guns by the year 1997.

There will be an increasing time-lag between the need for legislative action and the actual delivery of the needed legislation.

As legislative response lags further behind societal needs, democratic parliaments and congresses will be perceived as ineffective.

In many countries, executive powers will be increased to enable faster responses and more effective government.

Man-made and UV radiation levels will be life-threatening, in the 2005-2010 period, to the degree that underground enclaves will be developed at that time.

By 2010, many highly-sophisticated underground enclaves will be constructed, particularly in the United States.

Enclave development generally will become an area of potential business and profit for entrepreneurs.

By reason of natural disasters, economic downturns and political unrest, many people will seek to emigrate to more desirable countries: And such desirable countries will feel compelled to raise or reinforce their immigration barriers. (Note: New Zealand is one of the more desirable countries referred to here).

In order to maintain international balance-of-payments solvency, most countries will be forced to restrict or discourage imports.

Trade protectionism, and trade wars, will push the GATT and free trade movement into the background.

Many municipalities, throughout the world, will have difficulty remaining solvent. City maintenance and general services will tend to deteriorate.

The diagnostic and preventative aspects of medical science will become more sophisticated.

Surgery, hospitalisation, and therapy generally, will become more efficient ... with higher success rates, quicker patient turnaround and cost reductions.

More and more education will involve computer/video, set your own pace' learning.

Computer/video learning will lead to a more holistic and multi-disciplined development of education.

Government expenditure on schools, for public use, will decrease.

Government expenditure on public hospitals, and subsidised public health services generally, will decrease.

The advertising income and profitability of TV, radio and newspapers will decrease.

Many fishery resources will become depleted by drift-net fishing.

Products, incorporating effective ultra-violet barriers, will be in demand, for a wide variety of open-air applications.

The world demand for steel will decrease, as commercial, industrial and civil engineering construction declines.

Demand for, and mining of, industrial and construction metallic materials will decline, worldwide.

Those who are able to, will tend to retire earlier and to relocate in the remoter, healthy areas which offer good, low-cost living.

Horticulture, generally, will be depressed and, by reason of generally unfavourable weather conditions, it will become a chancier business.

Demand for venison will be slack, but demand for antler velvet will remain relatively strong.

Alcohol consumption will increase but, with more home production and reduction of consumer purchasing power, sales of alcoholic beverages will increase to only a moderate degree. Increased sales will be in the standard and cheaper lines.

By-passing value-added taxes, and avoiding dealer profit margins, cooperative barter trade will increase significantly. A variety of shrewd 'sub rosa' practices will develop, to the detriment of the retail trade and the government tax-take.

Against a background of general low financial liquidity, many nations will develop bi-lateral and multi-lateral deals (of the barter and 'credit for credit' types) which may be underwritten by governments of the countries concerned. Much trade will be between members of the same trading blocs.

Airlines, generally, will become more unprofitable. Aircraft maintenance standards and operational safety standards will decline.

As many business investments prove to be unsound, people with safe-investment, interest incomes will be in the best financial position, relatively.

Higher demand for heating oils will partly offset lower industrial oil consumption. Inflation-adjusted oil prices will be only slightly weaker in the short-term.

Over the next few years, new sources of energy will be developed, and the long-term trend of energy prices will be downwards.

Following on increased awareness that the available pool of work-hours is decreasing, social pressure will develop for work to be spread more equitably throughout the community.

Products and services, positively indicated by future trends, include:

Products and services, negatively indicated by future trends, include:

On the demand side, there will be a greater need for all foodstuffs but generally depressed consumer purchasing power will prevent most of this need from becoming effective economic demand. On the supply side, unfavourable weather and low production will tend to increase prices for foodstuffs. The net effect on food primary producers will be that they will, as a group, fare better than most. However, those who suffer most from the negative weather effects, will incur heavy losses.

Colder weather in many countries will have a favourable effect on demand for wool. However, lack of consumer purchasing power will largely offset this positive factor. Many wool-buying countries will want to buy more, but simply will not have the requisite hard currency.

For the following reasons, Governments will try hard to keep interests rates as low as possible:

Many factors are tending to increase interest rates. Governments compete with each other for international investment monies, which flow to where interest rates are high and security is sound. Lower disposable incomes and lower savings, along with Government deficit borrowings at record high levels, make for higher interest rates. The risks of business-lending are high and long-term lenders are scarcer: And, with the geometry of value changing (with higher discounting of future benefit flows) there is, in all, a strong 'under-tow' towards higher interest rates.

Essentially, trading banks depend upon healthy businesses which are willing to borrow at rates profitable to both the borrowers and the banks. But, during recession, good business borrowing is thin.

By reason of high Government deficits, Governments are very active borrowers, but the business sector (and its trading banks) tends to weaker and thinner borrowing in the recession.

Banks are finding it more and more difficult to sustain a profitable trading margin, of their retail lending rates over and above the wholesale rates they are forced to pay. They have the heavy expense of greater bad-debt write-offs to bear and their term-depositors are demanding higher rates.

Governments are now in competition with the trading banks, for Governments are the major borrowers in the market ... and they are borrowing direct from investors. The central banks (as the Government borrower-bankers) are in competition with the trading banks.

It is noteworthy that the central banks take no lending risks: All the banking lending risks are taken by the trading banks.

In the final analysis, it will be competition between Governments, internationally, for deficit borrowings, which will force up interest rates.

With growing Government deficits worldwide and lower savings, it is inevitable that some Governments will be unable to fully cover their deficits with borrowings. These Governments will be forced to resort to credit creation and to currency inflation.

Gold and oil prices generally move in concert for the following reasons:

Apart from the factors mentioned in 758 (above), special factors may affect the price of either gold or oil, without affecting the price of the other: The two prices would then no longer move in phase with each other. Such special factors would include:

It is noteworthy that there is now a strong speculative linkage between oil and gold prices. Speculators now deal on the expectation that when one of the two commodity prices moves the other will follow.

Most countries are using interest rates as an economic control mechanism. When a national currency is under threat, by heavy forward selling, the nation concerned tends to increase its rates of interest against the threatened outflow of investment monies. Such is currently (March 1993) the case with France, where the 90 day bill rate is 12% p.a. And approximately 6% above the UK rate (with inflation in each case at 2%). When a national currency is strong but the local economy is in recession, nations tend to decrease their rates of interest in order to encourage local business activity. Such is currently (March 1993) the case with Japan and USA, where the 90 day bill rates are 2% and 4%, respectively, below pure interest plus inflation expectations.

The current (March 1993) international gilt-edged long-term real rate of interest is 7% p.a. And the gilt-edged 90 day bill real rate of interest is 4% p.a. The general expectation is that currency inflation will increase over time.

Network indications are for a continuing change in the geometry of value, and for a more rapid rise in the rate of pure interest than that of the current (March 1993) general expectations. (Note: 'Pure interest' is the rate at which future benefit flows are discounted into present value).

Also, network indications are for a more rapid rise in the average world rate of inflation than that of the current (March 1993) general expectations.

As most people assume that the geometry of value will be unchanged in future, the market long-term interest rates are lower than my predictions indicate they should be. Other things equal, it pays to borrow long-term, at best market rates, rather than short-term ... and it pays to borrow for the longest term which can be negotiated. (Note: This should not be read as an encouragement to borrow).

As automation continues to cause more job-letting, effective demand continues to abate, along with reducing wage-based purchasing power.

As business profitability abates, along with consumer purchasing power, new investment abates also.

As new investment abates, new job opportunities become fewer and consumer demand drops lower.

Civil wars and natural disasters fail to create an upsurge of effective demand. On the contrary, affected countries become less credit-worthy buyers on the international markets.

The overseas trade of Japan, UK, Germany, France, USA, Belgium, Netherlands, Russia, and other countries, will decline ... and total world trade will decline.

Adverse weather and natural disasters will result in a worldwide food shortage, and in a change in the geographical location of the world's food production areas.

Countries which, in the past, have subsidised their local food production, will be justified (as to their strategy) by the world food shortage.

The Earth will assert itself geologically and climatically during 1993 and the coming years, to the degree that Earth factors will increasingly dominate the economic and political scene.

Idealism (in trade, social relations, political rights, justice and international relations) will give way to the pragmatic necessities of day-to-day survival. The Greens and ecology won't even take second place: They will be in fifth place or thereabouts.

Bi-lateral trade agreements will figure to a greater extent in future ... but laissez-faire will crowd everything else out. Attempts to control, contrive and manage 'improvements' will simply fail. Survival of the fittest will be the rule.

The gold price will move down with the price of oil. People will increasingly lose confidence in gold as a rock-solid store of value.

The major holders of gold, the central banks, will lose interest in gold because it is hard to sell in large quantities without a major adverse effect on its sale price. (Note: It is an 'iceberg' commodity, as only a fraction is traded at any time).

The late 1993 outlook for China is as follows: The economy will continue strong, as European industry was strong in its 'youth'. The Chinese economy will feed upon its own demand, and employment will be high. There will be a high propensity to invest, produce, earn and spend. Exports will grow by reason of their cheapness and of value relative to price. China will be economically successful and relatively stable politically. Earthquakes will occur with some intensity and frequency. The weather effects of increased world volcanism will cause some crop failures, and food prices will rise. Inflation will continue ... but not at such high levels as to undermine economic progress. The main exposure is in the risk of major crop failures.

The late 1993 outlook for USA is as follows: NAFTA will increase unemployment and defence cuts will increase unemployment: On the other hand, increased import protection will tend to create jobs. Exports will fall, and the net overall effect will be increased unemployment. Civil unrest will increase. USA will become more isolationist and will reduce its overseas involvements. Food prices will increase and most farmers will fare better. Oil prices will weaken. The US dollar will weaken. The fiscal and balance of payments deficits will continue at high levels. Adverse weather conditions will cause some crop failures. Natural disasters (storms, floods, quakes etc) will cause havoc and loss of jobs and loss of GNP. Interest rates will be increased to protect the US$ against investment outflows.

The late 1993 outlook for Japan is as follows: The rate of interest will continue to be lower than world average because of the large supply of available investment funds and the lack of desire to invest more funds overseas (Note: Most Japanese prefer to invest locally). Also, the Government policy to stimulate local business activity is expressed in downward pressure on interest rates. Japanese exports will suffer, as a result of increasing world protectionism against the importation of Japanese products (which is tantamount to the importation of unemployment). Many Japanese financial and real estate corporations will go into liquidation. Rice crop failures will result in increased rice imports and increased prices. Japan's balance of payments surplus will be substantially reduced. The Japanese economy will peak out, in 1994, to a plateau of very low growth. The yen will peak relative to other strong currencies, and will lose ground in some instances. Eruptions, quakes and other natural disasters will become national priorities and will adversely affect Gross National Product.

The late 1993 outlook for Europe is as follows: The exodus, from East to West, will continue to prove to be socially traumatic ... with a loss of nationalistic oneness and dynamic ... and a rise of fascism, particularly in Germany and Austria. Food shortages will confirm European countries in their long-held belief in the benefits of agricultural protectionism. The distrust of Germany, by the French, will reassert itself. The rivalry between Germany and France, for European hegemony, will increase. Italy will anarchise further, and will become unfit for membership of the European Community. Anarchism in Italy and fascism in Germany will destroy the process of European integration. Low-wage countries will gain jobs and sales orders at the expense of high-wage countries. Social strife, unemployment and crime will increase. USA will become an economic adversary. The United Kingdom will drift away from close participation in the European Community.

The late 1993 outlook for the United Kingdom is as follows: Unemployment will grow. The Liberal alliance will gain Government at the next general elections. The United Kingdom will move away from a close EC relationship to a more loose, pragmatic association. The UK will trade with the world and will rely less and less upon Brussels' dictates. The EC Government will become a hollow, Claytons government. UK living conditions and standards will decline. By the turn of the century, the UK will become a republic, and Scotland will have become independent. The UK will withdraw its defence forces from Northern Ireland by 1998. The UK is entering upon a long period of social and economic decline.

The late 1993 outlook for the former USSR is as follows: The grain harvests will be smaller than average, and food shortages will be general. Attempts to return to old-style bureaucratic economic management will fail. Obsolescent plant and lack of private enterprise know-how will delay conversion to successful capitalism. In many states, order will continue to decline and currency hyperinflation will cause economic and social havoc. The state of Russia will be almost reduced to anarchy. More areas and provinces will attempt to establish their independence. Civil wars will continue in many states. The Islamic peoples of the south will find common cause in their religion. Most of the former USSR will experience a decline of law, order and living standards. Outside agencies, such as the UN and USA, will have neither the resources nor the will to interfere.

The late 1993 outlook for Eastern Europe is as follows: The Yugoslavian conflicts will continue and will be exacerbated by United Nations and NATO involvement, and by support to the Bosnians from other Islamic countries. There will continue to be much human suffering in the area. The Romanian, Bulgarian, Moldovan and Kosovo situations will deteriorate. Germany, Austria, Hungary, Poland, Italy and Slovakia will refuse entry to all but a small percentage of refugees. The Eastern European wars will impoverish all participants, including Serbia. The whole Eastern European area will become an economic and social disaster zone, and its plight will impact severely upon the stability and welfare of the whole of Europe.

The late 1993 outlook for Italy is as follows: Corruption and organised crime will have such a hold on the country that it will be unable to regain order and stability. Italy will drift further into anarchy and chaos. Volcanic eruptions, quakes, and other natural disasters, will add to the country's problems. The currency will move further towards hyper-inflation. Italy will be one of the major causes of the collapse of the European Community.

The late 1993 outlook for Germany is as follows: The antiquated industrial plants and methods of East Germany will continue to hinder economic recovery. Labour union intransigence, concerning high wage levels, will continue. The refugee problem will be unabated. European Community pressure for lower interest rates will make counter-inflation measures more difficult. The world recession and trade protectionism will result in a decrease of Germany's exports. Government expenditure will increasingly outstrip government income, and the fiscal gap will be harder to bridge from government borrowings. There will be a reduced inflow of investment funds from other countries. Germany will be compelled to raise its rates of interest. The economic recession will continue, and unemployment and civil strife will increase. Neo-Nazism will continue to grow, particularly in East Germany ... but it will gain ground in West Germany. With increasing problems within Germany itself, and observing the deterioration in other European countries, Germany will discover that the European Community is far more of a liability than an asset ... and will proceed to put German interests first, second and third.

The late 1993 outlook for South Africa is as follows: During the next three years, South Africa will divide into three independent states ... Cape, Vaal, and Natal. Cape will be under ANC control; Vaal will be under Boer control; and Natal will be under Zulu control. Major violence will continue until at least 1997. After the Boers consolidate their new state, the economy of their northern region will improve rapidly. The Boers will negotiate Natal port-access with the Zulus.

The late 1993 outlook for the Middle East is as follows: Iraq will recover and will recommence its oil production and export. Its present form of government will be unchanged, and the political status of the Kurds and Shi-ites will be unchanged. Iran will continue in relative stability and as a leader of Islamic fundamentalism. Saudi Arabia will retain some stability, economically and socially ... and slow development towards democracy will continue. Kuwait will be caught up in a process of quickening change to liberalism and democracy. Algeria will move further towards fundamentalism. In Egypt, there will be a slower transition to fundamentalism: The country will continue under the influence of Western culture. Israel will drop further from United States' favour ... and the PLO will advance their cause worldwide. Jordan will continue to support Iraqi-led arabism. With world oil supply increasing relative to demand, the strategic importance of the Middle East will decline. With increasing world chaos, the powerful Western nations will become pre-occupied with their own problems, and the Middle East will produce its own solutions.

The late 1993 outlook for the Far East is as follows: The economies of Taiwan and South Korea will flourish. Hong Kong will suffer from divided leadership and will experience uncertain limbo conditions until the transfer of sovereignty to China in 1997. The Philippines and Indonesia will be adversely affected, socially and economically, by volcanic eruptions and natural disasters. There are separate forecasts for Japan and China. The Far East region, as a whole, will be the most progressive and successful in the world, economically, during the next three to five years ... and will flourish generally, while the European, North American, Central-South American, South Asian, former USSR, Middle East and African regions will languish. Australia, New Zealand, and the wider Oceanic group, will become ever more closely allied economically to the Far East region. The whole Far East tends to pragmatism, and to emphasise economic and social considerations ... rather than political ideologies. Generally speaking, it is a 'live and let live' region, where governments are regarded more as a side-show than as central features, and religious and ethnic tolerance is more commonplace than in most parts of the world. Throughout the region, there is a good work ethic, a natural desire to trade, a sense of commercial integrity and a basis of peaceful religious ideologies. The technological backwardness of much of the Far East works in its favour, as far as employment and growth of Gross National Product are concerned: Apart from Japan, automation is not yet causing a net reduction of employment.

The late 1993 outlook for Australia is as follows: The Labour Government will increase government expenditure and the fiscal deficit will increase. Investment funds will flow out, as interest rates become less competitive and as the Australian dollar weakens. The weakening A$ will reinforce inflationary forces (via rising import prices) and the rate of monetary and price inflation will increase. The export demand for ores and metals will continue to fall and demand for wool will remain weak. On the positive side, wheat and meat prices will rise and sales of manufactured goods into Asia will rise. There will be an adverse net balance of payments and overseas debt will rise. The Government will need to borrow large sums in order to fund the fiscal and balance of payments deficits ... and will have to increase rates of interest to accomplish this. A large part of government borrowing will need to be domiciled overseas and, to raise these loans, government will have to pay high interest rates, in order to compete with dozens of deficit countries which are also chasing scarce investment funds. Trade with the Far East will increase rapidly and Australia will become an integral part of the region. Within five years, Australia will become a republic. On the social front, unemployment will remain at high levels and crime will continue to increase. Unionism will continue to introduce inflexibilities into the economy, with consequent inefficiencies. Overall, the manufacturing sector will not perform well. Geologically, minor rifting earthquakes are expected in Eastern Australia. Droughts will occur in some areas. Overall, the economic and social outlook is only fair.

The late 1993 outlook for New Zealand is as follows: Farmers will receive good prices for virtually all food products. Even kiwi fruit prices will improve, but only marginally. New Zealand may expect longer and colder winters ... and unseasonal storms, hail, frost, floods and droughts. The market for wool will continue to be weak. Manufacturing, generally, will continue to improve and, in 1994 under Labour, will perform even better ... particularly with regard to exports to Asian markets. NZ manufacturers will have the edge on their Australian counterparts on price/value, and sales into Australian markets will increase until the Australian Government insists on protectionist revision of the CER agreement. Fishing and logging exports will be good, and exports of timber products will improve. The Australian $ will come under more pressure than the New Zealand $, and the exchange values of the two currencies will come closer together. By reason mainly of their high Government borrowing needs, both Australia and New Zealand will experience rising interest rates. The NZ$ will be firm but, close to the Nov. 1993 Election, the prospect of a change of government will cause some fund outflows ... and a weakening of the NZ dollar, which will bring about Reserve Bank intervention ... to again drive up interest rates. It is expected that Reserve Bank intervention will be frequent during 1994. Under Labour, the fiscal deficit will increase and overseas investment will be reduced ... and the Reserve Bank will tighten credit. As 1994 proceeds, the Bank's actions will be seen to run counter to general economic policy and employment policy, in particular ... and the Reserve Bank Act will be amended to loosen up on the anti-inflation provisions. The NZ Government and parliament will be seen as too dictatorial and insensitive to public opinion and as often exceeding their election mandate, as based on their election manifesto. The public will perceive the politicos as being big-headed and arrogant and out of touch with the will of the voting public. Further, parliament will be seen as being run by a clique which seeks to impose its views as to what is good for the people. The Government's PR communications will continue to be abysmal, with very little effective pre-selling of reforms. Under Labour, similar conditions will maintain and, in future, Government will be even more ineffective and 'Claytons' in character. Employment will improve from mid 1993 but gains in job numbers will be slow. MMP will pass into law and will apply to the 1996 election. Local communities will take more of an active leadership role, particularly in respect of law and order. As the Earth becomes more active geologically and as it becomes colder, New Zealand suffers worsening weather conditions, but will make net gains as an efficient and basically pastoral food-producing country. As pasture growth takes place down to 5.5 degrees C, pastoral farming will fare much better under future cold conditions than grain farming. The gradual disintegration of the EC will assist our export sales, and we will sell a greater percentage of our exports into Asia. In general, the future outlook for New Zealand is reasonably good, and certainly better than most countries overseas. There will be some volcanic activity at White Island and under water at the Kermedec ridge, and there will be a number of quakes, mainly on the East Coast of the North Island, but none of these are likely to be life threatening or likely to cause major damage. While Australia will move quite quickly towards republic status, the majority of New Zealanders will want to continue the present ties with the royal family.

The late 1993 outlook for the rest of the world is as follows: India and Pakistan will both experience social and political problems of a major nature, and will register only fair economic progress. Similar comments apply to Sri Lanka. Each year, the Indian sub-continent will suffer from droughts and floods ... with Bangladesh suffering the worst. Apart from Egypt and the Boer enclaves of South Africa, the whole African continent will be a veritable chaos of civil wars, economic hardship and disease. Central and South America will continue much as at present, with general political instability and poor economic performance. Adversely affected by the NAFTA agreement, Canada will move further into recession. The Aids disease will spread more rapidly worldwide. While agencies, such as Red Cross, will do good work, they will be dismally under-funded to meet escalating needs for aid. The UN organisations will be grossly under-funded and will show poor results relative to expenditure: The United Nations will decline in status. World levels of defence expenditure will decrease and safety and policing standards will decline worldwide.

In 1993, the rate of increase of the Japanese population has declined to a very low level.

In Japan, capital investment accounted for two-thirds of the growth of Gross National Product, between late 1986 and early 1991.

In Japan, the ratio of capital expenditure to Gross National Product peaked at 22% in 1991 ... and was 20.5% in 1992. (In Europe and USA, the comparable range was 12%-15%).

In 1993, returns on business investment and levels of business investment are declining in Japan. In the latter part of 1993, Japanese businessmen are coming to expect a lower long-term rate of growth of Gross National Product ... perhaps 2%-3% per annum.

Manufacturing only accounted for 36% of Japanese business investment in 1992. Manufacturing investment is declining sharply in Japan during 1993.

Although the Japanese government plans to boost public investment, such investment is running at only 7% of Gross National Product in 1993.

In Japan, the capital expenditure to Gross National Product ratio is expected to fall further. The 1991-1994 series is as follows:

1991 22.0%
1992 20.5%
1993 18.0% (my estimate)
1994 15.0%

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