Welcome to the Mclowd Community Newsletter.
A second explanation is that we are overlooking actual output – and thus productivity growth – because the new information-intensive goods and services are hard to measure, and their costs may be falling faster than standard methods allow us to gauge.”
Nouriel Roubini, Populists and productivity, Project Syndicate June 3rd
Economists like Professor Roubini are having a hard time reconciling the fact that labour productivity – as traditionally measured – has been stagnating (if not falling) in recent years, despite the fact that we live in a society / economy bristling with cutting edge technology.
What these economists have yet to realise is that after 200 years capitalism has reached a tipping point – beyond which it is has begun to destroy more value (as measured by nominal GDP) than it can create.
It’s not that people aren’t using the latest software, or powering their homes with electricity. It’s just that these outcomes are being delivered with far less money changing hands. The consequences of this process have been masked for the last twenty years by hundreds of trillions of dollars of debt, but as the citizens of Venezuela have just discovered:
- That party doesn’t last forever
- When it ends, it doesn’t end well for anyone
All this talk of deflation may seem esoteric to some, but it has just become very real for the shareholders of Amcor, whose Board recently announced they are writing off the entire value of their Venezuelan operations.
All US$350 million dollars.
Administration Platform Update
We have been conscious for some time regarding the absence of detailed user documentation, and have this month published a formal User Manual.
This represents only the first edition, and will expand steadily in the coming months. (We will further improve usability by linking this content into the relevant pages of the application itself).
I would like to acknowledge the efforts of trustee user Lorraine Cobcoft, who has been the driving force behind this project.
Commenting on her role within the Community, Lorraine had this to say: “Over the last 12 months I have cut the cost of managing my SMSF by more than 60%. I am not contributing to the success of Mclowd out of altruism, but because my participation is directly linked to maximising the net returns from my retirement assets.”
Sydney Training Seminar
Building on the success of earlier events, Mclowd will be holding another Training Seminar in Sydney on July 26th.
Seats are strictly limited and early bird tickets are available until 30th June. For more information and to register click here.
I would also like to welcome Victoria Kuok to the Mclowd Team. With ten years’ experience in SMSF accounting, administration, compliance and taxation, Victoria brings deep subject matter and product knowledge to the Community.
Having struggled to grasp the micro and macro-economic consequences of our journey towards a Zero Marginal Cost Society, economists like Nouriel Roubini may also not understand the increasing role that governance plays, both in terms of innovation as well as longevity.
As more and more mousetraps become free, the (rather noisy) process of creative destruction – which has driven capitalism relentlessly forward since the beginning of the First Industrial Revolution – has begun to weaken. Under these circumstances it is only those organisations that can operate at (or adjacent to) marginal cost that will survive.
Relationships within the Collaborative Commons will gradually solidify – particularly where governance has been well managed – and a relative quiet will ultimately (and thankfully) descend.
(By the time that destination has been reached, write-offs of the magnitude just witnessed by the shareholders of Amcor will represent little more than loose change).
Mclowd Pty Ltd