A meeting with Zombies - The Daily Reckoning
The Daily Reckoning by Bill Bonner
On This Day - 20 December 2012
A meeting with Zombies A  A  A

London, England

The snow lay on the ground
The stars shown bright
When Christ our Lord was born
On Christmas night

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A Meeting With Zombies...

"Excuse me, I've been waiting a half hour..."

The man looked Russian. He was sitting opposite us at the Pain Quotidian, a cafe at St. Pancras station in London. He was polite about it...but wished to register a complaint with the waiter for neglecting him.

"You don't have to be rude," the waiter, a slight, young man with a South London accent and tight-fitting black clothes replied.

"I wasn't being rude...I just would like some service."

"Well, don't be rude...I'll be back as soon as I can."

Outside, in the great hallway of St. Pancras station a Salvation Army band was playing Christmas music.

"Oh Holy Night..."

We turned to the Russian man. Gripped by the spirit of Christmas, we wished to make ourselves useful by offering a little cultural interpretation.

"Rude? That guy should get out more often. You weren't being rude. You were merely complaining. If you want to be rude you should call him a "f***ing a**hole. That will help put things in perspective for him."

Pleased with ourselves we went back to listening to the music.

"Oh Little Town of Bethlehem
How still we see thee lie..."

There are times when you need to relax. Listen. Pay attention. Let your mind wander. Rather than try to organize your thoughts...you should let them organize themselves.

The Russian man greeted a friend, who looked as though he could be Pakistani.

"I always begin my trips with a stop in London," he said to his friend. "I bring my money...and my passport. And I leave my money here."

On the other side of us, a hearty, almost burly, young man with red hair was regaling a young woman with stories. They must have been funny stories, because the woman - who had a very pretty face, but had allowed herself to become rather plump - acted as though she were having breakfast with Woody Allen or Rodney Dangerfield. To say she laughed 'lustily,' might give away too much. But there was something insincere about her laugh, as if she might not find him so funny after they were married.

A French couple sat on our left. Both in their 40s. Both dressed all in black.

"The doctor called. He said I only have 6 months to live," she said with a tossed-off laugh.

The man said nothing. Then, neither said anything. After they had finished their coffee, they got up and left.

This publication...such as it is...and in case you haven't noticed...is on its own, and most would say, out in left field. We and we alone are on 'Zombie Watch.'

Which is to say, nobody else seems to understand what feds' moneyprinting and deficit-financed bailouts, and redistributions are for: paying off the zombies. The longer they go on...the more zombies there are.

But let us leave Zombie theory and move on to Zombie practice.

Yesterday, in the very expensive offices of a very expensive law firm in the very expensive City of London, we met with four zombies. On the table was a discussion of how a company could publish the views and opinions of various experts - mostly MDs - on health...without going to jail.

Heath, medicine, drugs, food and supplements are heavily regulated in Britain and Europe...just as they are in the US. You can read the laws...if you dare. You're not like to know much more after you read them than you did before. They insist that opinions on health must be 'fair,' 'balanced,' 'based on reliable testing' and impeccable 'research.' What this really means is that it has to pass muster with the mainstream health establishment. The regulators are ignoramii themselves. They turn to 'experts' to tell them what is okay for publishing and what isn't.

That leaves the publisher of 'alternative' ideas and opinions in a tight spot. You may recall Dr. Atkins. Back in the '90s, Dr. Atkins came to us and asked us to publish his newsletter. We agreed. We stood behind the First Amendment and let fly with Dr. Atkins' theories on why the American high-sugar, low-fat diet was all wrong. The establishment didn't like it. They had staked their careers on the idea that 'fat' was the number one problem, leading to heart disease and other ailments. They called Atkins a quack and tried to take away his medical license. Atkins eventually won that battle. But not without a lot of scars.

In Europe and the UK there is no First Amendment. What you can say about health is regulated. And the regulators, as always, are in the pocket of the big, established industries they are supposed to regulate. A new competitor - with different, contradictory or gamey ideas - is at a big disadvantage. He'd better be careful, or his competitors will rat him out and the regulator will get on his case.

"Basically, you can't say anything that is not approved," said one $500-an-hour lawyer.

"Well, you can say what you want..." said an associate at $250-an-hour, "but you have to be sure it meets all the tests and criteria. You can't say one of the things that has been proscribed, for example."

"You mean there are specific things that you can't say?" we asked naively.

"Oh yes. There's a list of 1,280 things that by regulation or court decision have been found unacceptable."

"But what if our expert doctor really believes the contrary is true?" we continued.

"Well, he just can't publish it."

The conversation continued for an hour and a half. Estimated cost: $3,200.

Result? None. The system is rigged in the zombies favor. Zombie pharmaceutical businesses are protected from competition by zombie regulators. Upstarts must hire zombie lawyers to figure out how to remain at liberty while still doing business.

This is, of course, the 'complexity' that Joseph Tainter describes in his book explaining how societies collapse. They add layer upon layer of 'complexity.' Each layer costs money (resources). Finally, the society can no longer afford it. It declines and falls.

That night we went to a restaurant along the river, in Southwark. The Gaucho it is called. It is very stylish. And very full of patrons, almost all young, hip, urban, successful...men in white shirts and ties (having taken off their coats)...women in sleek dresses.

The couple on one side both had died blond hair. The man looked a bit like a disheveled version of Brad Pitt. The woman looked like she might be imitating Amy Winehouse. Otherwise, the diners were practically interchangeable parts of a vast machine. Clerks. Traders. Lawyers. Managers. Analysts. Salesmen.

We had seen them going to work in the morning...a river of them coming out of London Bridge station. In the evening, the river reversed course, like the Thames itself; the people flowed back out of central London.

But at 10PM many were still collected in the tidal pools - the restaurants, bars, and clubs of the city. There were at least 100 of them in the Gaucho.

Which world do they belong to, we wondered? To the world of real work...and real output? Or to the gray, zombie world ...where people go through the motions, but never really add a thing.

London grew rich by offering financial services. Its people show well. You wouldn't trust an Italian or a Greek with a sausage, let alone your money. But who expects to get ripped off by an Englishman with a good accent? And who knows a good English accent, except another Englishman?

And so the money rolled in...and the rents went up. And now, a small army of professionals dines at the Gaucho...fed on the profits of leveraged buyouts and securitized, derivative-enhanced hedge funds, far out on the efficient frontier.

"Russians are the worst," the cabdriver told us on the way back to our hotel.

"I guess they're used to getting ripped off at home. So, they come here. They get in the cab. And if I get stuck in traffic...or if I have to detour to get around traffic...they think I'm trying to put something over on them. They're stupid. They trust the bankers but not the cab drivers. It ought to be the other way around."

Bill Bonner is the President & Founder of Agora Inc, an international publisher of financial and special interest books and newsletters.

The views mentioned above are of the author only. Data and charts, if used, in the article have been sourced from available information and have not been authenticated by any statutory authority. The author and Equitymaster do not claim it to be accurate nor accept any responsibility for the same. The views constitute only the opinions and do not constitute any guidelines or recommendation on any course of action to be followed by the reader. Please read the detailed Terms of Use of the web site.

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