Economics, Financial Ethics and Consulting; Hartzman Fiduciary

One who intends to leave others better off for his having existed.

4/21/14

"Technology Is Deflationary"

"...inflation is only oxygen for debtors barely able to service their debt and those who profits from debt, i.e. bankers and financiers.

For everyone earning a wage or salary, inflation is the equivalent of death by a thousand cuts and deflation is the elixir of life.

When prices decline, our money goes further, i.e. our purchasing power increases.

Only bankers, governments and other parasites that live off the carrion of debt fear deflation and try to destroy the purchasing power of wages...

...When state-protected cartels rule the roost, costs go up no matter how much new technology is introduced. State-protected monopolies (sickcare, higher education, etc.) can suppress disruptive technologies, at least for a while, until their bloated, high-cost, diminishing-return structure collapses under its own weight.

...technology eliminates costly human labor. In the late 19th century, roughly 50% of the labor force worked on farms. Today, the number is 2% of the workforce.

At the turn of the 19th century, the largest category of employment was domestic help. The rise of electrical appliances and machines of convenience eliminated much of the need for domestic labor.

The next sector to undergo large-scale destruction of jobs was manufacturing. The process of replacing human labor with robots and software automation in factories is still underway.

Advances in software are now eliminating white-collar office jobs and retail employment.

...self-employed information workers can now produce output and manage services that required three to five people a mere 25 years ago.

...As technology eliminates millions of jobs by replacing human labor, wages decline and the percentage of national income that goes to labor also declines. This means there is less money for consumption, pressuring prices of consumer goods. This is broadly deflationary.

...The wholesale elimination of white-collar labor has barely started.

...A few years ago everyone needed a landline telephone, a separate phone line for a modem, a television, a DVD player, a mobile phone, a stereo system and a laptop computer. Now all anyone under the age of 30 needs is a smart-phone and perhaps a cheap laptop or tablet.

...people can get rid of cable or satellite and watch most programming via the web.

...As competition drives prices down, profits erode. This is why the ideal set-up for profits has always been monopoly. But technology has a way of disrupting monopolies.

...Transparency is anathema to cartels, which is why the actual cost of healthcare is obscured by providers desperate to avoid competition. But the web is introducing transparency and that alone is disrupting and creatively destroying profits based on information asymmetry.

...Profits go down as creative destruction takes down profitable rentier skims, cartels and bloated, inefficient industries.

...Technology, like Nature itself, has no emotional stake in what is creatively destroyed. Technology had no attachment to lamplighters or buggy-whip manufacturers, and it has no attachment to the Fed, sickcare, higher education, manufacturing or the state itself, all of which are being remorselessly disrupted.

As Bob Dylan put it, he not busy being born is busy dying.

That is equally true for enterprises, industries and institutions."

http://charleshughsmith.blogspot.com/2014/04/sorry-fed-inflationistas-technology-is.html

4/20/14

"Each time gas prices have surged up towards $3.80, US macro-economic fundamentals have collapsed"

http://www.zerohedge.com/news/2014-04-20/gas-prices-hit-13-month-highs-prompt-macro-concerns
If there’s only so much oil and unlimited currency production capacity,
could energy demand exceeding supply ignite stagflation?

Could economic growth
be limited to available and/or affordable energy supplies?

Fossil fuels resemble capital in the bank

A prudent and responsible parent will use his capital sparingly
in order to pass on to his children as much as possible of his inheritance.

A selfish and irresponsible parent will squander it in riotous living
and care not one whit how his offspring will fare.

I suggest that this is a good time to think soberly
about our responsibilities to our descendants…
those who will ring out the Fossil Fuel Age

Admiral Hyman Rickover
Father of the Nuclear Navy

"Calling All Future-Eaters

The human species during its brief time on Earth has exhibited a remarkable capacity to kill itself off.

 The Cro-Magnons dispatched the gentler Neanderthals.

The conquistadors, with the help of smallpox, decimated the native populations in the Americas.

Modern industrial warfare in the 20th century took at least 100 million lives, most of them civilians.

...Homo sapiens, as the biologist Tim Flannery points out, are the "future-eaters."

In the past when civilizations went belly up through greed, mismanagement and the exhaustion of natural resources, human beings migrated somewhere else to pillage anew. But this time the game is over. There is nowhere else to go.

The industrialized nations spent the last century seizing half the planet and dominating most of the other half. We giddily exhausted our natural capital, especially fossil fuel, to engage in an orgy of consumption and waste that poisoned the Earth and attacked the ecosystem on which human life depends. It was quite a party if you were a member of the industrialized elite. But it was pretty stupid.

Collapse this time around will be global. We will disintegrate together. And there is no way out. The 10,000-year experiment of settled life is about to come to a crashing halt. And humankind, which thought it was given dominion over the Earth and all living things, will be taught a painful lesson in the necessity of balance, restraint and humility.
There is no human monument or city ruin that is more than 5,000 years old.

 Civilization, Ronald Wright notes in "A Short History of Progress," "occupies a mere 0.2 percent of the two and a half million years since our first ancestor sharpened a stone."

..."Whether human beings would still be a force on the planet, or even survive, is a moot point," ...Clive Hamilton in his book "Requiem for a Species...writes. "One thing is certain: there will be far fewer of us."

We have fallen prey to the illusion that we can modify and control our environment, that human ingenuity ensures the inevitability of human progress and that our secular god of science will save us. The "intoxicating belief that we can conquer all has come up against a greater force, the Earth itself," Hamilton writes. 

...We face a terrible political truth. ...Decisions about the fate of the planet and human civilization are in the hands of moral and intellectual trolls...

...lobbyists make the laws. Their public relations firms craft the propaganda and trivia pumped out through systems of mass communication. Their money determines elections. Their greed turns workers into global serfs and our planet into a wasteland. ...They cannot be reformed or trusted.

...We will either defy the corporate elite...or see ourselves consumed.

Time is not on our side.

...The future, if we remain passive, will be wrested from us by events."

Chris Hedges
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If US mainland oil discovery peaked in the 1930’s,
leading to a production peak in the early 1970’s,
and world discovery peaked in the 1960’s, when should global oil production peak?

Think of the Earth as a living organism…being attacked by billions of bacteria,
whose numbers double every forty years.

Gore Vidal

If more money and energy equals more food, and more food equals more people,
will less fossil fuel lead to less food …?
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"The Math That Predicted The Revolutions Sweeping The Globe"

http://hartzman.blogspot.com/2014/02/the-math-that-predicted-revolutions.html

"US Food Prices Are Up 19% In 2014" "Q1 GDP estimates are down 30% in the last 2 months"

http://hartzman.blogspot.com/2014/03/us-food-prices-are-up-19-in-2014-q1-gdp.html

If mold continues to multiply after eating half a piece of cheese
what happens when demand exceeds supply?

Did increasing supplies of money, fossil fuel and food,
contribute to Earth’s human population rising
from 1.6 billion at the beginning of the 20th century,
to more than 6.8 billion in a little more than 100 years?

Have the powerful created symbols for the powerless to destroy
to turn tyranny into nationalism?

Linkfest and Thoughts; 4/20/2014

Can asking for nothing be receiving everything?

Obamacare Triggers Jump in U.S. Consumers’ Health-Care Spending

http://www.bloomberg.com/news/2014-04-17/consumer-spending-on-health-care-jumps-as-obamacare-takes-hold.html

Bank Defaults Seen as Dark Side of Deposit Vows: China Credit

http://www.bloomberg.com/news/2014-04-20/bank-defaults-seen-as-dark-side-of-deposit-vows-china-credit.html

"The banks are the permanent government of the country
whichever party is in power.”
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Lord Skidelsky
House of Lords, UK Parliament, 3/2011

News & Record's superficial endorsement of superficial candidate

http://roch101.blogspot.com/2014/04/news-records-superficial-endorsement.html

"if you owe a lot of people a lot of money, 
there's nothing better than to pay it back with cheaper money."

Potholes for Pensions: Color Me Paved And Confused

http://greensboroperformingarts.blogspot.com/2014/04/potholes-for-pensions-color-me-paved.html

POLITICAL HIT PIECE CALLED “LAUGHABLE” BY GREENSBORO RESIDENTS

http://yescurrent.wordpress.com/2014/04/20/political-hit-piece-called-laughable-by-greensboro-residents/

It is the essence of a finite intellect not to understand many things,
& it is of the essence if a created intellect to be finite.

Descartes

Guilford Education Alliance

http://www.guilfordeducationalliance.org/aboutus/board.php

"The party would say 2 + 2 = 5
and you would have to believe it.
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The logic of their position demanded it."
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George Orwell

Parasitism

http://en.wikipedia.org/wiki/Parasitism

Five Reported Killed In East Ukraine Following Ultra-nationalist Attack

http://www.zerohedge.com/news/2014-04-20/five-reported-killed-east-ukraine-following-ultra-nationalist-attack

Weaker countries are reaching the point where they can't borrow more $, 
or stronger country's won't guarantee their debt anymore."

Matheny for Congress 4/15/2014 Campaign Finance Filing

http://docquery.fec.gov/pdf/032/14960793032/14960793032.pdf#navpanes=0

'being too far ahead of your time
is indistinguishable from being wrong.'
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- Howard Marks

Gun control, Ukraine and reality

http://hartzman.blogspot.com/2014/04/gun-control-ukraine-and-reality.html?spref=tw

Ukraine, Through the US Looking Glass

http://www.truth-out.org/news/item/23179-ukraine-through-the-us-looking-glass

"If there is more than one attorney involved,
no one knows what time it is."

New City of Greensboro Interim Attorney Thomas Caruthers

How Is Zack Matheny Earning His Piece?

http://www.triadconservative.com/2014/04/how-is-zack-matheny-earning-his-fee.html

Jordan Lake’s troubled waters

http://www.newsobserver.com/2013/07/13/3026345/jordan-lakes-troubled-waters.html

ZACK MATHENY:MR. 2%?

http://www.keepconservativesunited.net/1/post/2014/04/zack-mathenymr2.html

"The top 1% of 825,000 individual medical providers
accounted for 14% of the $77 billion in medicare billing in 2012"

U.S. No Longer An Actual Democracy

http://talkingpointsmemo.com/livewire/princeton-experts-say-us-no-longer-democracy

We’re almost out of money for roads

http://www.vox.com/2014/4/15/5617468/were-almost-out-of-money-for-roads

On capitalism and coercion

http://www.aljazeera.com/indepth/opinion/2014/04/capitalism-coercion-2014417133923106962.html

Developer can’t pave over holes in city loan contract

http://yesweekly.com/article-permalink-18090.html

"Distance is his best feature"

"Troubled Currencies Project black-market exchange-rate data"

http://hartzman.blogspot.com/2014/04/troubled-currencies-project-black.html?spref=tw

"The true measure of a man
is how he treats someone
who can do him absolutely no good."
.
Samuel Johnson

The world’s wealthiest generation forfeited their children’s financial future for present prosperity

http://hartzman.blogspot.com/2014/04/i-believe-worlds-wealthiest-generation.html?spref=tw


"29 percent of Americans believe 
that "cloud computing" involves an actual cloud."

Bait-and-switch

"Bait-and-switch is a form of fraud...

...First, customers are "baited" by advertising for a product or service at a low price; second, the customers discover that the advertised good is not available and are "switched" to a costlier product.

...The goal of the bait-and-switch is to persuade buyers to purchase the substitute goods as a means of avoiding disappointment over not getting the bait, or as a way to recover sunk costs expended to try to obtain the bait.

It suggests that the seller will not show the original product or service advertised but instead will demonstrate a more expensive product or a similar product with a higher margin.

...Real Estate Brokers and Agents often advertise themselves as buyer agents without disclosing that they may not be able to provide that service if they work for a brokerage that lists homes and represents home sellers."

Bait-and-switch

Counterfeit Money, Counterfeit Policy

"What is the difference between printing money and counterfeiting?

There is none.

"NEED LITTLE - WANT LESS - LOVE MORE"; A CREDIBILITY TRAP

"A CREDIBILITY TRAP IS A CONDITION WHEREIN THE FINANCIAL, POLITICAL AND INFORMATIONAL FUNCTIONS OF A SOCIETY HAVE BEEN COMPROMISED BY CORRUPTION AND FRAUD, SO THAT THE LEADERSHIP CANNOT EFFECTIVELY REFORM, OR EVEN HONESTLY ADDRESS, THE PROBLEMS OF THAT SYSTEM WITHOUT IMPAIRING AND IMPLICATING, AT LEAST INCIDENTALLY, A BROAD SWATH OF THE POWER STRUCTURE, INCLUDING THEMSELVES.

THE STATUS QUO TOLERATES THE CORRUPTION AND THE FRAUD BECAUSE THEY HAVE PROFITED AT LEAST INDIRECTLY FROM IT, AND WOULD LIKE TO CONTINUE TO DO SO.

EVEN THE IMPULSE TO REFORM WITHIN THE POWER STRUCTURE IS SUSCEPTIBLE TO VARIOUS FORMS OF SOFT BLACKMAIL AND COERCION BY THE SYSTEM THAT MAINTAINS AND REWARDS.

AND SO A FAILED POLICY AND ITS SUPPORT SYSTEM BECOME SELF-SUSTAINING, LONG AFTER IT IS SEEN BY OBJECTIVE OBSERVERS TO HAVE FAILED. IN ITS FAILURE IT IS COUNTERPRODUCTIVE, AND AN IMPEDIMENT TO RECOVERY IN THE REAL ECONOMY.

ADMITTING FAILURE IS NOT AN OPTION FOR THE THOUGHT LEADERS WHO RECEIVE THEIR POWER FROM THAT SYSTEM.

THE CONTINUITY OF THE STRUCTURAL HIERARCHY MUST THEREFORE BE MAINTAINED AT ALL COSTS, EVEN TO THE POINT OF BECOMING A PAINFULLY OBVIOUS, ORGANIZED HYPOCRISY."

Jesse

Domestic Deflation Before Inflation

"The economic situation is deteriorating for the average American, the mood of the country is darkening, and the world is awash in debt and turmoil.

Every country is attempting to print their way to renewed prosperity.

No one wins a race to the bottom.

The oligarchs have chosen a path of currency debasement, propping up insolvent banks, propaganda and impoverishing the masses as their preferred course.

...Their lies and deception have held sway, but they have only delayed the final collapse of a boom brought about by credit expansion. They will not reverse course and believe their intellectual superiority will allow them to retain their control after the collapse.”
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"An initial spark will trigger a chain reaction of unyielding responses and further emergencies. The core elements of these scenarios (debt, civic decay, global disorder) will matter more than the details, which the catalyst will juxtapose and connect in some unknowable way...

At home and abroad, these events will reflect the tearing of the civic fabric at points of extreme vulnerability – problem areas where America will have neglected, denied, or delayed needed action.”
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"Facts don’t matter in world of QE for the psychopathic titans of Wall Street and misery for the indebted peasants of Main Street. The government data drones, Ivy League educated Wall Street economists, and the obedient corporate media propaganda apparatus declare that GDP has grown by 2% over the last four quarters and we are not in a recession. If you believe their bogus inflation calculation then just ignore the collapsing retail sales, stagnant real wages, and rising gap between the uber-rich and the rest of us."
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"Corporate profits have leveled off at record highs as mark to fantasy accounting fraud, condoned and encouraged by the Federal Reserve, along with loan loss reserve depletion and $5 billion of risk free profits from parking deposits at the Fed..."



"Bernanke’s QEternity, Wall Street’s high frequency trading supercomputers, record levels of margin debt, a dash of delusion, and a helping of clueless dupes have taken the stock market to another bubble high."
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"The problem with bubbles is that they force one to decide whether to look like an idiot before the peak, or an idiot after the peak. There’s no calling the top, and most of the signals that have been most historically useful for that purpose have been blazing red since late-2011."
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"Japan is still a bug in search of a windshield. With a debt to GDP ratio of 230%, a population dying off, energy dependence escalating, trade surplus decreasing, an already failed Prime Minister vowing to increase inflation, and rising tensions with China, Japan is a primary candidate to be the first domino to fall in the game of debt chicken."
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"The EU has temporarily delayed the endgame for their failed experiment. Economic conditions in Greece, Spain and Italy worsen by the day with unemployment reaching dangerous revolutionary levels. Pretending countries will pay each other with newly created debt will not solve a debt crisis. They don’t have a liquidity problem. They have a solvency problem. The only people who have been saved by the actions taken so far are bankers and politicians."
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"The little people are bearing the burden of the Obamacare insurance premium increases. The number of employed Americans has increased by 1 million in the last year... The anger among the former middle class is simmering below the surface, as Bernanke’s policies further impoverish the multitudes... Holder and the U.S. government remain fully captured by Wall Street. The states have proven to be toothless in their efforts to enforce the law against Wall Street. The continuing revelations of Wall Street fraud and billions in fines paid by JP Morgan and the other Too Big To Trust banks have been glossed over by the captured mainstream media. As long as EBT cards, Visas and Mastercards continue to function, there will be no outrage from the techno-narcissistic, debt addicted, math challenged, wilfully ignorant masses."
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"While most people get lost in the minutia of day to day existence and supposed Ivy League thought leaders are consumed with their own reputations and wealth, apparent stability will morph into terrifying volatility in an instant. The normalcy bias being practiced by an entire country will be shattered in a reality storm of consequences."

http://www.theburningplatform.com/2013/12/31/2013-dense-fog-turns-into-toxic-smog/

"The Merger of State and Commerce"

"...There are now few truly free markets left within 21st Century Western capitalism.

...The newly-invented powers of the central banks to buy anything, to fund any bailout, can reach into any area of the economy, either to grant large favors or to inflict great pain.

...In one of the Fed’s generous ways the second US housing bubble has been inflated from a river of counterfeit money and a wet-blanket of [low to artificially imposed inflation adjusted] negative interest rates.

The QE Forever giveaway ...through buying toxic mortgages at full price charges on.

...Adam Smith’s Lassie Faire capitalism has become the ancient, barbaric relic in our modern fiat money Western world economy.

The US has now what is called a “mixed economy” involving many “public-private partnerships” and “professional self-regulation” and “social programs”. These are modern phrases that explain the slow return to feudal ways.

Monopolies of political power or of markets yield huge profits for the few over generations without much. Monopoly power is a distant mirror of feudal nobility. It operates in both the public and the private sector and so often in direct combination with each other.

...Most economic transactions, at their base, rely on a large element of trust. Deceit punishes trust to self-advantage. Deceit harms the economic market itself, beyond the impact of the con-jobs in play. A marketplace chocked with deceit is a fraud itself, the absence of the rule of law.

...Counterfeiting by central banks now affects almost every investment decision.

...it is little different than the peasants always giving a one-third share of their crops to the royal duke just because the King says so [via currency debasement, which is taxation via inflation without representation].

...The same general form of corruption permeates an increasing number of professions and businesses.

...The national health-care industry seems to have become almost a single cartel empowered by federal spending.

...A mix of public and private institutions rule US higher education as a single-minded oligarchy. This cartel is primarily empowered by federal spending in the form of student loans. The younger generations are saddled now with a trillion dollar in debt to repay college tuition and fees that no longer deliver a good job.

...the ultimate overarching rigged system in the US is the effective monopoly by two private political cartels sharing the same basic agenda, the Democratic Party and the Republican Party. ...The success in keeping the “two-party system” in place has had far more to do with the special privileges granted by law to Democratic and Republican candidates than to any good reason for a lack of meaningful political competition.

...Today’s economic model was best summed up by dictator Benito Mussolini in one short sentence: “Fascism … is the perfect merger of power between the corporations and the state”.

But tyranny also has its life-cycle within the balance between the past and the future. Once the past becomes far too much of a millstone for the future generations to carry any longer, governments fall and debt and servitude recede [via a deflationary spiral of mass defaults of payment commitments, and simultaneous widespread loss of confidence]."

Stephen Merrill

"What we have today is a complete mess."

"An exchange used to be a place, yes, a physical place, where people would come together to buy or sell, hoping to achieve the best price for themselves," he said. "The more the exchange was able to attract all of the buy and sell interests in a product, the more the prices on the exchange would reflect the true state of supply and demand."

"In the last twenty years came computers, electronic communications, electronic exchanges, dark pools, flash orders, multiple exchanges, alternative trading venues, direct access brokers, OTC derivatives, high-frequency traders ... Reg NMS in the U.S. -- and what we have today is a complete mess."

"It is not so much anymore that the public does not trust their brokers. They do not trust the markets, the exchanges, or the regulators either. And why should they, given our showing the past few years? To the public the financial markets may increasingly seem like a casino, except that the casino is more transparent and simpler to understand."

"...I did not see the forces of fragmentation and the opportunity for people to use technology to keep to the letter but avoid the spirit of the rules -- creating the current crisis."

"It is vitally important that we bring an end to this crisis of trust before it spreads any further. That we bring back order, fair dealing, and trust in the marketplace. The financial markets of ... the world's developed countries are at a turning point. Technology, market structure, and new products have evolved more quickly than our capacity to understand or control them. The result has been a series of crises over the past few years that have caused many investors to lose confidence or to think that the whole system is a rigged game."

Thomas Peterffy

http://www.zerohedge.com/news/2014-04-07/father-high-speed-trading-speaks-market-we-created-casino-complete-mess-rigged-game

4/19/14

"The American economy during the 19th Century twice experienced deflationary periods of roughly 50 percent"

“...the only episode in which we find evidence of a link between deflation and depression is the Great Depression (1929-1934). We find virtually no evidence of such a link in any other period.. What is striking is that nearly 90% of the episodes with deflation did not have depression. In a broad historical context, beyond the Great Depression, the notion that deflation and depression are linked virtually disappears.

...The conventional view of deflation is that if it sets in, “the banking industry, the financial markets, and much of the rest of the economy will be wiped out in a bottomless deflationary spiral.” But as Hülsmann goes on to argue, such a spiral would not prove fatal to the lives and welfare of the general population. Rather, it would destroy “essentially those companies and industries that live a parasitical existence at the expense of the rest of the economy, and which owe their existence to our present money system.

Severe deflation threatens at an existential level bankrupt banks and the bankrupt governments that perpetuate their existence. Deflation is a mortal enemy to the heavily indebted state and its embedded parasites, but it is a friend to the saver and to anyone with a positive net worth. Because it is so dangerous to the debtor, (unelected) central bankers clearly feel they have no option but to incinerate savers at the altar of perpetuating an unsustainably indebted banking and political elite.”

http://www.cobdencentre.org/2014/04/everything-we-are-told-about-deflation-is-a-lie/

4/17/14

Trojan Horse Scam

"...a trojan horse is an ...offer ...designed to draw potential [Marks] by offering them ...something of value for acceptance, but following acceptance, the buyer is forced to spend a much larger amount of money, ...by being signed into a lengthy contract, from which exit is difficult...

The harmful consequences faced by the [Mark] ...may include spending far above market rate [or a] large amount of debt...
...the victim of the trojan horse is likely to end up spending far more money over time, either through continual withdrawals from the [Mark's indebtedness] ...or add-ons to a bill that must be paid in order to avoid loss of an object or service of prime importance (such as [police, fire or energy]).

...Auto-manufacturers and car dealerships will often advertise free or subsidized gas to car buyers for a certain amount of time, but increase the cost of the car in other ways."

Trojan Horse Scam

4/14/14

Passover Conundrum; Exodus 12:23

"When the LORD goes through the land to strike down the Egyptians, he will see the blood on the top and sides of the door frame and will pass over that doorway, and he will not permit the destroyer to enter your houses and strike you down."

http://biblehub.com/exodus/12-13.htm
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If God is all knowing, why would God need the Israelites to smear blood on their doorways, if God knew who was who?

If there is only one God, who was the destroyer?

How can God order the murder of the first born, if God is all good?

If God is all mighty, why would a destroyer be necessary?