"Give me a beverage strong enough..."

Introductory info: A few of us recently got into a discussion on Tom Peters' website and blogs regarding (first) Lorenz's "Butterfly Effect" (also known as the law of "Sensitive dependence upon initial conditions") which states that a butterfly flapping its wings in the rain forest on one side of the world moves molecules of air, which in turn move other molecules of air... eventually causing a hurricane on the other side of the world. There has also been a lot of commenting on Tom's site regarding banks, financial institutions, and their contribution to the current economic crisis by means of subprime and careless lending practices.

Then, discussion ensued regarding "The beer game," which originated at M.I.T. The game demonstrates very vividly how wild fluctuations can occur in markets and supply chains due to system delays and the assumptions and overreactions on the part of the "players" (members of the supply chain.) I lightheartedly proposed that the consumption of real beer be added during the execution of the beer game. The following is a bit of dialog which got some fun reactions, and let to one of my very own mottos (an obvious twist on Archimedes' quote about "Give me a lever long enough..."

I'll let you read the rest for yourself. Here it is, copied from Tom's site, per the suggestion of a fellow blogger:

John, it is truly one of the greatest tools I've seen for showing folks how our "best thinking" is more often than not exactly what creates our worst problems. "The significant problems we face cannot be solved at the same level of thinking we were at when we created them." -- Einstein.

Stephen, I would add the "wings" of the consumer. Our demand for ways to buy homes and cars and things we cannot realistically afford is a demand that someone is bound to try to capitalize on -- namely "lending institutions." As they say, be careful what you ask for "flap, flap" because you just might get it... "flap, flap"... and end up with a foreclosure and bankruptcy... "splat"...

"Honey, was that a butterfly that just hit the windshield?"

It ain't all the lenders' fault. If someone makes a faulty product and we naively keep buying it, we should question ourselves instead of shouting "How the hell are they allowed to do that and stay in business? Look at all the mess they made." But we DO buy what they're peddling.

It's sad, but true, that had there been this much discussion and complaining about the nature of what they were doing when they started doing it, the situation might be different today.

We want cheap credit, lenient credit, and indeed end up overextending ourselves. They see that as an opportunity and facilitate it, overextending THEMSELVES in the process. We -- the consumers -- are just as guilty as they are in this mess. True, they "sell" us on doing the same foolish things over and over, but we're just as guilty of "selling" to them by unwittingly demanding it of them.

Not long after he took office, I heard that Obama was instituting steps to encourage credit card companies and auto finance companies to offer more credit to consumers. "HELLO? Is anybody awake out there?" Bankruptcies hit all time highs while credit defaults are causing banks and lending institutions to fail. I was totally flabbergasted that President Obama was even suggesting that what we needed was more of the same.

PaulH, the consumer position is good. Enough cold beers and the game would have more entertainment value... and the economy might start looking less dreary. While we're playing the consumer role in the game, we should paint our bodies, wear clown wigs, wave pom poms, and root for one of the other players in the game... "Watch this y'all, Chuck's playing the part of the warehouse guy. Betcha he punches ol' Robert in the nose before the game's over. He damn near pulled out his .357 in the parking lot on Bill after the last game. GO CHUCK, GO CHUCK... come on everybody... let's get a wave going..."

A wave... one person starts it, and soon 80,000 people in the stadium are doing something that's seen on televisions all over the country. Hmmm... good example of the butterfly effect right there.
Amazing what one too many beers can lead to.

Posted by Dan Gunter at July 9, 2009 8:27 AM

Maybe I just found my new motto: "Give me a beverage strong enough, and singlehandedly I can move the world's economy." -- Dan Gunter, circa this moment. LOL.

Why NOT? Everything else to do with the economy has pretty much wound up in the toilet.

Posted by Dan Gunter at July 9, 2009 8:28 AM
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