The engineer will think of ways to break the system, say a point of sale touchscreen system that has five sucessive screens that the user proceeds through, what happens if a user simply walks away on screen three? What does the next user have to do? Ever wondered why the ATM doesn't spit your card out until the end of the transaction, or why the default action with a duff card is to spit it out internally?

The blue sky brigade will look at things differently, they will thing about integrating cameras and card readers into the ATM in such a way that the user does not notice the additions.

Here is an example.

The 007 Film "Goldfinger" featured the evil mastermind detonating a dirty nuclear bomb in Fort Knox, thus irradiating the gold and rendering it worthless, thus making him even richer and more powerful... this was the scenario when people generally believed that Fort Knox still held some actual gold ingots before the Fed sold them off after decoupling the currency.

The blue sky brigade come up with "Blackfinger", in this scenario the evil mastermind detonates the bomb inside the Ghawar oil field, and you can guess the rest.

As I said at the start, blue sky-ing is indulged in by business, government and military, and that is an umbrella that covers the world of business finance quite well, so it should be no surprise to learn that the world of business finance has such processes, the interesting part comes when we consider what kinds of things these think tanks come up with.

The first point to consider is that any think tank produces three sorts of ideas, the first sort is published, because it suits the parent organisation to put these memes out there in the wild. The second sort is most definitely not published, because it could harm the parent organisation (what's wrong with our network security etc.), and the third sort is neither of the above, it is the real blue sky stuff, you don't deliberately make it secret, because it's not quite real enough to be dangerous or embarrassing, on the other hand, you don't deliberately publish it either, because it's not quite real enough to not be dangerously embarrassing.

"Peak Oil" was just such a thing, you can bet your life on every oil company, every military machine, and every government having a blue sky think tank mulling over peak oil, and we can all think of examples of stuff that was deliberately published, was deliberately not published (but later leaked out) and perhaps, if we think about it carefully, the third category, neither deliberately secret nor deliberately published, but almost always interesting.

Some time ago there was a debate about the morality (prior to codifying a law on the subject) of harvesting the eggs from aborted female foetuses, the debate raged on between the camps, but one single piece of blue sky thinking from one single reporter killed it, "what will you say to the child (grown from the salvaged eggs) when it asks you why you murdered its mother?"

That meme effectively killed the whole idea.

The whole idea that that particular meme came from one single reporter is also suspect, it sounds much more like a whole load of people had the thought subconsciously at various depths, slowly bubbling towards the surface, then, like the invention of the telephone (or just about anything else) it pops up fully developed, because after all, many people have been engaged in searching for a particular type of answer to a specific question, so it is by definition not a one horse race.

There is one of these interesting, neither good enough propaganda to be published, nor dangerous enough to keep secret, memes just now bubbling to the surface in the financial world, and appropriately enough it deals with bubbles.

This particular piece of blue sky thinking states that bubbles are created deliberately, because bubbles are to finance what Oahu is to surfing.

"created deliberately" should not be taken to mean that the illuminati in the shadows are pulling strings, it means that babies are an inevitable side effect of people having sex, very few sexual acts are engaged in purely for the purpose of making a baby, and only a small minority have some form of contraception excluded, but, nevertheless, babies are born.

This particular piece of financial blue sky thinking is quite interesting, not just because it lives on the water margin between the published and the secret, but because it shares that other characteristic of real blue sky thinking, it isn't one dimensional, it doesn't have an introduction, a story, and an epilogue, rather it describes a system like wolves and rabbits, ongoing, dynamic...

It says that there are various fields of human industry, such as agriculture, industry, demographics and finance, and as finance grows in relative importance the dynamic shifts, eventually it comes to the point where finance has leveraged agriculture and industry all it can, and demographics most of the way too, so the only way for finance to further expand is to create a sequence of bubbles.

It is doomed, sure, so is the Mayfly, but that is the point, the Mayfly DNA denotes its future, and the Finance DNA denotes its future. This scenario doesn't require illuminati or roque traders of scammers or anything else, all it requires is a little bit of DNA code, the results are inevitable. Just a question of time, and cycles.

Currently we can all hate international finance, they are after all on top of the pile, before them it was international industry, and before them baronial landowners...

I've mentioned before that one of my "hats" is mentor to a 20 something, and the subject of bubbles and recessions with a big "R" came up yesterday, the young un asks what to look out for, what strategies to adopt, what "tells" to look for in society.

It is actually a really tough question, how do you teach a subject that the student literally has zero personal experience of?

I break it down into several historical observations that withstand scrutiny.

1/ With individual exceptions, individual people and small family units survive such events, where survive means they live through them.

2/ With individual exceptions, individual institutions and small groups of institutions survive such events too, where survive means they live through them too.

3/ With few exceptions, both for individuals and institutions, survival in this scenario means adapt or die, and adapt means you don't get to choose the things you'd prefer, if you get a choice it is between different kinds of pain and hardship.

4/ With few exceptions, the unpleasantness of the individual choices facing both individuals and institutions in such scenarios is influenced by how carefree they acted in the last ten years, and how tight a corner they painted themselves into in the expectation that the status quo would not change.

5/ Above all, for both individuals and institutions, this is the time you get to realise that you are part of a system, which you aren't in control of yourself, and the effects of which you cannot insulate yourself from.

I can say to the twenty- something, you'll hear phrases like "society and industry does not work because of government, it works despite government" and to make it more personal, your place of work doesn't function because of management, it functions despite management, most members of staff know they job more or less, and do it more or less, in exchange for wages... but you'll only hear such phrases from those who remember the last time of flux... not those old enough to remember it, but those who actually consciously do remember it day by day, and who are aware of the shifting weather around them.

I tell the twenty something a story.

There are two guys in Africa, one is a camera man and one is a sound man, they are out on their own early one morning (while the anchor man and crew are asleep, them having drawn the short straw) to get some stock footage of the lions.

The bottom line is they get too close, and it becomes apparent that they are on the menu for breakfast, so the cameraman drops the camera and starts running, while the sound man drops the sound gear and pulls off his desert boots and puts on his trainers.

The camera man starts laughing and the sound man, "You'll never beat the lions in them."

The sound man says, "I don't have to, I only have to beat you."

Don't be front runner, don't bring up the van, be the invisible one just behind the leaders of the first or second pack of runners, make sure that when the starting gun goes off you were listening for it, you were wearing the right gear, you know which way to run and you've been practising running.

It's not a guarantee that you'll win, chances are you won't, it is a guarantee you won't fall at the first hurdle, or the second... it's a fighting chance, which is all anyone can expect really.

I personally had been predicting late 2007 / early 2008 as the start of the Recession with a capital R, having though some about this latest piece of "bubble" blue sky thinking to come out of the financial world, it's good news and bad news, good news because they race is going to be delayed somewhat, bad news because it is now going to be a double marathon...

I think we are due for one more big blow out "party like it's 1999" global financial bubble, I think maybe 2009 / 2010 is when it will blow out, so we've got a little more time, but the challenge is bigger, the differences between winners and losers more profound, the opportunities for gain and for loss more significant.

The Human Race takes on a more profound significance, it really is a race, it isn't about fair, or right, or clever, or prudent, the dice will fall where they may, we can influence them some, but only for our own chances.

If you've always felt yourself to be a round peg in a square hole, maybe 2009/2010 will be your chance, or maybe it will be your wake up call.