I understand that jspm is not installed globally, since it is a host controller, I cannot install it globally.
This seems to be wrong (at least for now.) You can install jspm globally on a hosted controller.
I was able to solve this using the build process, which looks like this:

- npm install
- npm install -g jspm
- node C: \ NPM \ Modules \ node_modules \ jspm \ jspm.js install
1) Installs all local dependencies from my package.json. 2) Installs the global version of JSPM 3) Calls it from the global installation location
I understood from M Falanga that node is obviously in the controller path, so I could call it from the Powershell / command line. The global JSPM installation location that I discovered is scanning build debug logs. Note for developers, you must make sure that your working directory for steps 1 and 3 is installed in the place where your package.json is located.
Alternative solution
I have not tested this next option in the assembly yet, but you should skip the additional steps of the assembly and just use the NPM scripting function to install JSPM. In this case, you do not need the NPM installation step or the node step above.
In your .json package, you will need the following script entry:
"keywords": [...], "scripts": { "postinstall": "./node_modules/.bin/jspm install -y" }, "jspm": {...
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