For about 20 years, Ray Keating wrote a weekly column - a short time with the New York City Tribune, more than 11 years with Newsday, another seven years with Long Island Business News, plus another year-and-a-half with RealClearMarkets.com. As an economist, Keating also pens an assortment of analyses each week. With the Keating Files, he decided to expand his efforts with regular commentary touching on a broad range of issues, written by himself and an assortment of talented contributors and columnists. So, here goes...

Thursday, March 31, 2016

Throwback Thursday: Creators, Conspirators and Monopolists, Oh My!

by Ray Keating

Prominent businessmen don’t always understand how the economy actually works. That’s been evident on the presidential campaign trail this year, with Donald Trump leading the Republican field and Michael Bloomberg’s brief flirtation with jumping into the race as an independent. Trump and Bloomberg clearly are clueless on a host of issues – such as Trump on trade – regarding how the economy functions and how policy impacts the economy. But, of course, there are many business leaders who understand how the economy works, and even offer some rather unique insights. That’s the case with Peter Thiel and his book “Zero to One: Notes on Startups, or How to Build the Future.” The following review ran as a Long Island Business News column of mine in October 2014 …

I recently headed west to Silicon Valley for a gathering focused on technology policies. At the start of that journey, standing in an airport bookstore, I decided to get the full Silicon Valley techie experience, and picked up Peter Thiel’s new book “Zero to One: Notes on Startups, or How to Build the Future.”

It’s a valuable, quick read that provides fascinating insights on thinking about entrepreneurship and the economy, and what’s needed to start up a business.

Thiel was a co-founder of PayPal, and has been an investor in a variety of startups, including Facebook. His perspectives on how businesses function in the economy are drenched in a refreshing economic reality.

The central theme of Thiel’s message is the need to create new things. He points out, “Doing what we already know how to do takes the world from 1 to n, adding more of something familiar. But every time we create something new, we go from 0 to 1.” He warns, “Unless they invest in the difficult task of creating new things, American companies will fail in the future no matter how big their profits remain today.”

One would expect Thiel to declare that the word for “0 to 1 progress is technology.” However, he quickly adds that it’s not all about computers: “Properly understood, any new and better way of doing things is technology.” Another word for that is innovation.

For Thiel, building the future and creating new things is accomplished by monopolies. What? How can that be? Well, he has a better grasp on how the economy actually works than many economists. Thiel correctly rejects the concept of “perfect competition” that is taught in all Economics 101 classes, whereby undifferentiated firms and homogeneous products sell at the market price, and economic profits are competed away. That’s not how the economy works, nor quite frankly, does it help students to understand the market process.

But what about this monopoly thing? Thiel writes: “To an economist, every monopoly looks the same, whether it deviously eliminates its rivals, secures a license from the state, or innovates its way to the top. In this book, we’re not interested in illegal bullies or government favorites; by ‘monopoly,’ we mean the kind of company that’s so good at what it does that no other firm can offer a close substitute.”

While he does not put it exactly this way, what entrepreneurs and businesses are doing within a competitive environment is investing and innovating to create what effectively are temporary monopolies that allow profits to be maximized. And the longer a firm excels at providing something that consumers cannot get elsewhere, the longer the business can maintain that temporary monopoly. That’s quite different from the government-protected or created monopoly, for example, that grows fat, lazy and rips off consumers.

As Thiel proclaims, “Creative monopolists give customers more choices by adding entirely new categories of abundance to the world.”

Thiel’s subsequent advise and ideas for those looking to start up new businesses spring from this basic understanding of what entrepreneurs and businesses need to do – that is, to create something new and better – if they seek bold success. And he offers many valuable insights on that process. But among my favorite bits of wisdom tie in to how to think about business and career – one has to do with chance and the other secrets.

On business success being all about chance, Thiel counters that if that were the case, we would not see the successful serial entrepreneurs that we obviously do. He adds: “Learning about startups is worthless if you’re just reading stories about people who won the lottery.”

And on creative secrets, he provocatively but accurately writes, “The best entrepreneurs know this: every great business is built around a secret that’s hidden from the outside. A great company is a conspiracy to change the world; when you share your secret, the recipient becomes a fellow conspirator.”

So, here’s to those creative, conspiratorial monopolists who change the world.

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Mr. Keating is an economist and novelist who writes on a wide range of topics. His Pastor Stephen Grant novels have received considerable acclaim, including The River: A Pastor Stephen Grant Novel being a finalist for KFUO radio’s Book of the Year 2014, and Murderer’s Row: A Pastor Stephen Grant Novel winning Book of the Year 2015.

The Pastor Stephen Grant Novels are available at Amazon…



Friday, March 25, 2016

Big Thumbs Up for “Batman v. Superman”

by Ray Keating

Batman v. Superman: Dawn of Justice: 4.5 stars out of 5

Marvel Studios and Warner Brothers produce very different superhero movies, and fans of the genre should appreciate this fact. Quite frankly, there’s more to enjoy.

If you’re looking for another “Avengers” movie (and I love those films) when heading in to see “Batman v. Superman: Dawn of Justice,” then you will be disappointed. But if one is open to an arguably more serious superhero film, then “Batman v. Superman” ranks as a gem.

Director Zack Snyder serves up a rich mix of human strengths and weaknesses, mystery, detective work, action, faith, love, family, sin, redemption, sacrifice, along with a bit of humor. That’s quite an accomplishment for a superhero flick. “Batman v. Superman” certainly offers the wondrous special effects, for example, one expects from superhero films, but they are coupled with a certain emotional and moral gravity.

“Batman v. Superman” also is a film that requires an attention span and some thought on the part of the moviegoer, which were clearly lacking among some in the theater I attended.

As for Ben Affleck as Batman/Bruce Wayne, the choice arguably was the biggest question mark heading into this movie. But Affleck’s performance ranks as the best on-screen Dark Knight yet. Forget Christian Bale, Ben Affleck is now Batman. And to say that he is a no-nonsense Batman grossly understates the matter. This Batman has fought crime for many years, wonders what has been accomplished, and now sees an even more daunting threat. It is Jeremy Irons as Alfred who does a wonderful job acting as Bruce Wayne’s conscience, while mixing in some irony and wit.

Batman’s questions and doubts about Superman (Henry Cavill) center the film. Bruce Wayne and others lost friends, family and colleagues when Superman fought General Zod in “Man of Steel” in the Battle of Metropolis. As a result, Batman sees Superman as a threat, not a hero, and certainly not as a god, as some do. But others start asking the same questions as Batman, including a U.S. senator.

While questions and the debate rage over his actions, Superman goes on saving people.

And it naturally is Lex Luthor, played in over-the-top fashion by Jesse Eisenberg, who relishes manipulating heroes and events.

The resulting conflict between Batman and Superman, along with its resolution, packs a real emotional wallop. The two heroes come to understand that they have a kind of brotherhood, and that they share a common humanity and a duty to protect their world.

For good measure, the appearance of Wonder Woman and other hints of what’s to come in future Justice League movies merely whet the moviegoer’s appetite.

“Batman v. Superman: Dawn of Justice” stands out as a noteworthy, powerful addition to the superhero movie catalogue, and serves as a firm foundation upon which to further build the DC Cinematic Universe.

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Mr. Keating is an economist and novelist who writes on a wide range of topics. His Pastor Stephen Grant novels have received considerable acclaim, including The River: A Pastor Stephen Grant Novel being a finalist for KFUO radio’s Book of the Year 2014, and Murderer’s Row: A Pastor Stephen Grant Novel winning Book of the Year 2015.

The Pastor Stephen Grant Novels are available at Amazon…





Review, or Reminder, on “Man of Steel”

by Ray Keating

(Warning: Includes what some might consider “spoilers.”)

Man of Steel: 5 stars out of 5

If you’re going to the new “Batman v. Superman: Dawn of Justice” movie, you should have seen “Man of Steel” (2013). If not, grab the Blue-Ray, DVD or digital version, and give it a whirl. You won’t be sorry. In fact, even if you saw “Man of Steel,” another viewing is in order.

While “Man of Steel” has received some real flak on the Internet (I know, go figure, cranky people complaining on the Internet), it quite simply ranks among the top superhero movies of all time. And director Zack Snyder and Henry Cavill in the lead role created the best Superman on film. It’s not even close.

From the opening on the dying planet of Krypton to the concluding brawl between Superman and General Zod (Michael Shannon) in, above and around Metropolis, “Man of Steel” is visually fascinating and stunning.

But thankfully, there’s much more to the film than off-the-charts special effects. In nearly two-and-a-half hours, the moviegoer gets to know key points about who the characters are, in particular, Clark Kent/Superman/Kal-El, his Earth parents Jonathan (Kevin Costner) and Martha (Diane Lane) Kent, and his Kryptonian father, Jor-El (Russell Crowe).

Jor-El sends Kal-El to Earth to both save his son from the dying Krypton, but also as a way to save both humans and Kryptonians.

Meanwhile, Jonathan understands that Clark is bound to change the world with his incredible powers, but also knows that he will face opposition. Jonathan is concerned about properly forming his son’s character, so that he is prepared for the inevitable, formidable challenges, and ready to do the right thing. In doing so, Jonathan makes some questionable decisions himself, but we see that it’s all done for his son.

It turns out that as Superman, Clark does work to help others in truly selfless ways. The parallels to Jesus are present, and sometimes less than subtle.

In one powerful moment, after Zod arrives seeking Kal-El and taking on Earth, Clark still has not been revealed to the world. He stops in at a church, looking for insight and guidance. As Clark wrestles with his decision, in the background is a stained glass portrait of Jesus in the Garden of Gethsemane. Clark tells the priest or pastor that Zod cannot be trusted, but he is not sure about the people of Earth either. As Clark goes to leave, the priest/pastor advises: “Sometimes you have to take a leap of faith first. The trust part comes later.”

Clark takes that leap of faith, surrenders to mankind, and then, on behalf of humanity, he must go to war with General Zod and his soldiers.

By the way, in the midst of the subsequent super-powered conflict, Snyder presents a rather stirring portrait of those serving in the U.S. military, who despite being obviously outgunned, if you will, they stand firm, and bravely fight.  

Like any war, the fight is brutal, with damage unfortunately falling even on to noncombatants. And in the end, yes, Superman is forced to take a life. This act has led to much of the criticism of “Man of Steel.” But the compelling, powerful point is that Superman had no choice. He does not want to kill, but given that innocent lives are at stake, he makes the only choice possible with great reluctance. And after doing so, he weeps.

Yes, “Man of Steel” serves up great special effects and plenty of excitement, but in the end, its power lies in exploring the character of the person who is Kal-El, Clark Kent and Superman.

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Mr. Keating is an economist and novelist who writes on a wide range of topics. His Pastor Stephen Grant novels have received considerable acclaim, including The River: A Pastor Stephen Grant Novel being a finalist for KFUO radio’s Book of the Year 2014, and Murderer’s Row: A Pastor Stephen Grant Novel winning Book of the Year 2015.

The Pastor Stephen Grant Novels are available at Amazon…





Thursday, March 24, 2016

Blame Trump’s Supporters

by Ray Keating

So, how do we explain the Trump phenomenon?

Well, quite frankly, I’m sick of the seemingly endless gymnastics being performed to pin blame for Donald Trump on seemingly anyone but the people actually supporting and voting for Donald Trump.

The list of excuses turns out to be quite lengthy.

Some say it’s President Barack Obama’s fault. After all, he’s been such a bad, weak, left-wing president – and he most certainly has – that Obama has driven people to support Trump. Of course, one does not necessarily follow from the other.

And then there’s the nefarious, mysterious and elusive “Republican Establishment,” which supposedly has not done enough to take on Obama. As a result, the excuse goes, frustrated voters have no choice but to turn to Trump. For good measure, so-called “conservative” talk radio hosts feed the idea of Trump being anti-Establishment, and their listeners follow, accordingly. What the “Establishment” actually is really makes little sense any more, amounting to little more than name calling, while ignoring Trump’s long affiliation with those long distrusted by conservatives, such as Hillary Clinton.

Of course, there also are those darn foreigners. According to Trump, illegal immigrants and free trade with other nations lie at the core of our economic troubles, and the entire D.C. establishment – this time both Democrats and Republicans – stands unwilling to do anything about it. But Trump is ready to round up 11-12 million illegals and kick them out of the country, build a massive wall on our border with Mexico, and dump free trade agreements and impose some big time tariffs. Never mind the economic havoc this would wreak, as well as the human rights violations.

In the end, I don’t even blame Donald Trump for Donald Trump’s success. After all, any candidate who, for example, has flip-flopped (from liberal to populist or conservative) on nearly every major issue for pure political convenience, favors crippling the economy via protectionism and a massive government-forced migration, supports taking private property in favor of crony capitalism, takes foreign policy advice from his own “good brain” and watching television, attacks women (including the wife of anther candidate and Megyn Kelly) in seemingly countless ways, advocates using the military to kill innocent people, donated to his most likely Democratic opponent, mocks war heroes for their brave actions during war, indicates that riots and violence in support of his campaign are okay, has a long list of bankruptcies and shady business dealings, and is not too fond of the First Amendment, deserves only the votes of the flaky few.

Nonetheless, Mr. Trump is well on his way to gaining the Republican nod. There’s no one to blame for this other than the people who are actually voting for this ignorant, dangerous individual. Anger, frustration or whatever other excuses simply do not hold water.

We are each responsible for our actions, and have the responsibility to be informed voters. Trump voters either fail to understand such responsibilities, or care nothing about them.

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Mr. Keating is an economist and novelist who writes on a wide range of topics. His Pastor Stephen Grant novels have received considerable acclaim, including The River: A Pastor Stephen Grant Novel being a finalist for KFUO radio’s Book of the Year 2014, and Murderer’s Row: A Pastor Stephen Grant Novel winning Book of the Year 2015.

The Pastor Stephen Grant Novels are available at Amazon…