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Letters from Downunder

A world of opportunity

Submitted by Lindsay
Melbourne Australia!

This strong seducer, opportunity.
John Dryden, The conquest of Granada, 1670

(5/2014) Many years ago I managed a reasonably large pathology supply company here in Australia, and took on the role of motivator to the sales staff. One of the slogans I used was: "The window of opportunity is always open. It’s just that the blind is down." Well, that may be pretty ordinary these days, but the idea is still valid, and opportunity is to be found in most parts of the world, if you look hard enough. Whether it is individuals, companies, organisations or governments, if there’s a gleam of light from behind that blind then someone, somewhere will get an idea and possibly create something worthwhile.

Most opportunities are so trite we never give them any heed – those involved in daily living, for instance – but some are so unique they come along very rarely. These require more than normal observation, more than common expertise, and a much more questioning mind to uncover, but result in significant change . The story of penicillin discovery is one such: When a young research scientist named Howard Florey saw that a yeast colony that had floated onto an uncovered petri dish had somehow produced a clear area in the bacterial growth on the agar, he took the opportunity to be curious. Most people would have tut -tutted, discarded the dish and gone on to repeat the experiment, covering the dish so it could not be contaminated. Not Howard. All he did, really, was to ask ‘why is that?’, and lo, the greatest medical breakthrough in the 20th century was under way.

He was not given the opportunity to develop the subsequent processes involved in the commercialization of his penicillin, but he had lifted the blind on that wonderful window of antibiotics. It takes a particular kind of mind to do that, and many of these, notably from the mid 19th century onward, were in the United States. (Florey was Australian). Some remain household names today, and helped transform not just the landscape, but the very way the world runs. Our lives would be very different without names like Ford, Goodyear, Franklin, Hubble, Gates – the list goes on and on – and while we all partake of the discoveries or developments they made, a far more profound outcome resulted.

The U.S. Dollar became the currency to the world. This was not something any of the great innovators had set out to achieve, as it took many diverse minds in and out of politics to bring about, but just as the pound sterling had been the international currency in the 19th century, the 20th saw the greenback take line honours, and to stay there. This brought myriad opportunities in many spheres, but in the long run it became a matter of habit to think in U.S. Dollars no matter where you lived. Once the floating exchange rate became commonplace, the daily dollar comparison was a hot topic of conversation amongst traders, merchants, and investors around the world.

This was perhaps the biggest single driver of American dominance, and coupled with the amazing production levels and high quality of the goods manufactured, earnt you a place as the preeminent nation. This had nothing to do with ‘normal’ opportunity, that strong seducer quoted above, the seducer that can bring riches and poverty, comfort and wretchedness, slavery and liberty, but it did foster the worship of the dollar, enterprise free from control, big dreams and profits, and an unhealthy smugness.

It also ushered in the world of rapid change, a technological fantasy that today morphs faster than anyone can comprehend, one where opportunity is nerd dominated.

To us non-nerds all this seems to be a kind of witchcraft, but we are prepared to go along with it, for what else can we do? Our daily lives are bit-bound, @ has become the symbol, and we learn Greek as the numbers increase. Commerce still relies on experience, instinct, careful appraisal, and luck. And constant work. Nerds shall not prosper. (Ha!)

And we still trade in $US. Well, most of the time, for the Euro has now got its share – but habits die hard, so we stay loyal. The trade with our biggest customer is still in greenbacks, but that’s about to change forever. No, not the nerdy bitcoin, but the basic currency of the world’s second biggest economy, the Yuan.

You may have missed the announcement, for here it appeared in small type on page something of the financial review, but this will change the world more that nerds ever could. The claws are unsheathing. China has just introduced the convertible Yuan, meaning we can trade with them without the $US in play. We can look at the price of an import or export and know exactly what we will pay, removing the fluctuating exchange rate between them, you, and us. We sell billions of dollars worth of Iron ore, coal and gas to China every month (they are now our biggest customer, just as you are of them), and although we will get paid in their currency, not yours, we can then use it to directly pay them for what we buy from them – and that’s plenty.

New Zealand has already signed up, I believe we are soon to do so, and no doubt many others will follow suit. But not the United States, for yours is still the largest economy on earth – but China is catching up fast, largely thanks to you. The chase for the biggest sales margins, pioneered by Wal-Mart, led to the rise and rise of Chinese manufacturing, middle class, pollution, and allowed vindication of their unique form of government, socialist capitalism.

It seems that no one is too worried, for the report went on to say that the G21 believed the world would simply have to accommodate them. With half of the world’s population, that is some accommodation to face, but the power this will give them will alter the balance of trade. At least the idea of conflict has receded – for the present, although trade wars will no doubt escalate.

I’m sure China has no desire to ruin the greenback, as they own so much of it, but this new venture will make it so much easier for the rest of the world to go direct to them, meaning the speculation that drives non-productive gain will be more in their hands - and they do not play by our rules, such as they are.

The opportunity emerged, and they have taken it. Their newfound militarism and global finance are no more than facets of a whole strategy that cares less for humanity and the environment than most others, one that is the opposite of the old isolation, but firmly rooted in ultimate control. They aim to be the world’s banker, and it will be interesting to see the administration’s take on this. Severe disquiet is in the wind.

The rise of an elite, of intellectual power, of willingness to deal, exploit, and demand is scary enough, but we do have to live with this tiger, claws and all, and things will be certainly different. Who knows, it might even be exciting. There’s going to be plenty of opportunities.

Lindsay, from the safety of the living room down under.

Read Past Down Under Columns by Lindsay Coker