Long Vo-Phuoc
Writer. Retired Fund Manager.
Articles & Works of Fiction. © All rights reserved.
A Contemporary Landscape
Alexei Navalny, 1976-2024, died 16 February in Russian prison from staged conviction on trumped-up charges. Rest in peace.
Invasion and war
Much is being written, learned or otherwise, on this blatant and depressing invasion of Ukraine by Russia, thus only a few short notes here:
The Ukrainian President Zelenskyy deserves the highest honour from all for how he has been conducting himself, and the Czech Republic is the first to have offered him one. He was in Munich for a security conference only a few days before war started - the smell, the rumour, of war was thick even in Germany at the time. But he immediately returned to Kyiv - his wife, his children were still there, would still be there. His people and country too were still there, would still be there. May the pages of history remember him fondly as one who rose, as he now does, well above himself and most others.
This is unlike the cheap pollies the world over. Remember the so-called president Nguyen van Thieu of South Viet Nam in 1975? Remember the so-called president Ashraf Ghani of Afghanistan last year?
The thorough coverage by the Economist and the live blog and longer articles by Al Jazeera are balanced I find. Note also the articles by the latter on the plight of the African and Asian residents (mainly students), the Roma too, in Ukraine fleeing the war. I'm saddened that they experienced racism at the Ukrainian and Polish (and perhaps other countries’ too) borders – see here and here.
There may be another side of these stories, or there simply may not whatever the denials and excuses. Come on. Let’s cast those lousy crappy racism aside, no place for that, the world has moved on. The EU stressed the equality of treatment to all refugees at the outset of this war. Put theory in practice mates or world sympathy would ebb quickly.
On a different tangent, see also a snip of a recent survey by the Economist, published online today, 08/03/2022. A picture says a thousand words – there you are, polarised American or not.
Last but never least, happy International Women’s Day. The boys should always remember that throughout the year, each year.
March 2022.
Biden – more interesting than I thought?
The above is what in my mind, this moment thinking about politics in Yanksland, geo-political stuffs too for that matter. I thought he was dull during Obama’s tenure 2008-16, and was hoping that he didn’t try to have a go for the top job in 2016, a fresh Democrat candidate was needed (fresher than Hillary Clinton that’s for sure, but that didn’t turn out to be the case). His family tragedy prevented that to happen. There was of course the huge baggage on his back – his son Hunter, what kind of a sub-species of humanity is that? It’s hard to fathom, let alone having an iota of sympathy, these guys and gals whose belief of own ability and expectation of what life owes them is so far from their own worth as the distance from the centre of the galaxy to this puny lump of earth.
Enough about Hunter. Before the 2020 election what I was lamenting about Biden (Joe, that is) was that the guy was old, boring, tiresome. All I could see of him, under the eight years with Obama, was his facial expression (a well-studied one, half-grimaced, half-empathetic, full of practiced understanding and earnestness, always with a nod now and then – the bloody bs nods) when standing next to his President giving the usual eloquent speech to Congress, to press conferences and whatnots. Speeches were what Obama was excellent at, quite ahead of action, successful or otherwise.
The only consolation to me was that Harris was the vice-presidential candidate. Maybe she would squander a fair bit of money (but don’t they all round the world the last 15 months, see below), but she appears to be exciting. Now if something happened to Biden during the next four years, if they won, then Harris would take over, not a bad choice. Certainly better than Johnson (remember the all-the-way-with-LBJ when the guy escalated the Viet Nam war? The guy was kind to the American blacks but quite happy to bomb the hell out of Viet Nam. Dirty Nixon later on too, of course, saying this for completeness’ sake.).
Well Biden and Harris won, fair and square as can be expected from the unbelievably creaky voting system and accompanied shenanigans of the US. I was happy enough that the thuggish Trump didn’t win, stifled my yawns after the TV excitement of Nov 6 and a few days afterwards (though, like many others, I didn’t expect to see the ridiculous carry-ons lead to the US Congress being stormed in January).
And what have I seen since? Well, being a practical guy I list the main items below, from my viewpoint, of Biden’s menu to date for the reader’s pleasure, along with short comments where warranted:
China: contrary to the far-right’s insistence (in particular that of the anti-communist Asian communities - the Viets especially) Biden has not gone soft on China, period – regardless of his much-touted belief in globalism (and why should this have to be mutually exclusive to a stance against communism or China – a silly unfounded nonsense concocted by the far-right and the ill-informed) or son Hunter’s previous lamentable business dealing in that country. He has hardly rolled back any of Trump’s main measures in this regard, and I believed Trump put these on not from an ideological desire but simply from self-serving populism before the election. Biden’s man Blinken (who supported the wrong war against Iraq in 2003) is as tough on China as Pompeo, albeit more diplomatically. All in all, Biden is squeezing China hard on human rights issues, the Uighurs question in particular.
Russia and Europe: Biden is hard on Russia, no question, the opposite of Trump. This is to the Europeans’ delight! Remember the famous interview where he coolly “uh huh I do”-ed when asked if he thought Putin (an ex-KGB man of the Soviet Union) was a killer? That’s racy stuffs, totally unexpected, and totally interesting.
Immigrants: exactly true to pre-election sentiments, he has been much kinder to them than the previous nasty chap who throughout the four years stooped real low to cheap populism (Trump’s German forebears were immigrants to the US). True, the hopeful Central American migrants have heard Biden’s sentiments, arriving more, and are presenting fresh challenges, headaches too, no doubts, but such is life, between the easy life of those who have plenty on the one side and the desperate life of those who have nothing on the other, those who have very little, those who are oppressed by thugs in their own countries, political thugs, criminal thugs, bureaucrat thugs alike. It is certainly not harder a job for the head of the US any more than for similar ones around the world confronting the issue (go ask, sympathise with and learn from Jordan), and not harder than any of the above or below topics. But a warning, Biden: don’t hang around for long with the cap of 15,000 Trump imposed, increase it somehow, and soon, or lots of faith will be lost, and so will be seats in the 2022 Congress election.
Money thrown into the air: ah, this is the subject that I seriously dislike about Biden, the Democrats, the Left, the Right too, all governments around the world at the moments, left, right, dead-centre, populist, genuinely soft-hearted or mean cold-headed, etc. I don’t like governments squandering money. So I don’t like them all. Say it again, I severely despise governments squandering money, be they Australia, China, Japan, France, Germany, Great Britain, Switzerland, Zimbabwe, Brazil, Argentina, and especially the centre of humanity’s financial shenanigans, the United States. Because it’s not their (those government boys’ and girls’) money, it’s the doughs that belong to the populace and the nation, now and in future. I may be politically centre-left but most definitely powder-dry on the economic side. I don’t like governments spending, as in the case of Biden, like there is no tomorrow – making the idiotic helicopter-money Bernanke chap look like a miser in comparison (different methods of squandering notwithstanding). Trump had already squandered plenty of dollars before (self-serving to the business sector and the rich boys/girls first via tax cut, which is government spending in another form, then cash in the air like confetti using the covid-19 excuse), and Biden now even more, same excuse, two trillion USDs (these are cash of twelve zeros after the 2 and well before the decimal place mind you). And now another 2T for the US rusty infrastructure, salivating the iron-ore speculators no end (now at record high, courtesy of China shovelling in Australia’s red dirt). This may have to be reduced to 1T soonish, but still it’s 1T. Biden and Powell must be praying that inflation doesn’t pick up anytime soon. It's true that Biden has helped organise 200 million vaccine jabs rather than the 100m he earlier promised, so some of the spending has been very useful (the Australian government has achieved the reverse in this vaccine respect by the way).
(An aside. Of course if a government has no spare cash, no budget surplus as in almost all cases, the spending would be from debt, that is, negative assets for future citizens, a burden on their back. Not so long ago if you spend public money, or issue debt to spend, in that fashion your currency would swoon south, your bond and share markets would go belly up and consumer confidence shot to pieces. Not so these days for two main reasons. First, all the rich nations do the same thing in roughly the same proportion (the US doing the most, but it has the reserve currency) so the equilibrium is more or less preserved among the exchange rates, resulting in lesser financial disruption.
Second, and more importantly, a spare capacity in production and labour force world-wide, a result of globalism and tech advance, exists to help the flood of extra money contain inflation and thus interest rate (see also below). In addition, governments’ lock-downs from covid-19 has dampened demand and preserved that spare capacity, both labour and machinery. And always, of course, there is abundant labour in poorer parts of the world to ensure that spare capacity to continue for some time. Eastern-European and Chinese workers are now earning more, but there are still the Indians (very uneven there), the Vietnamese (a little better), the Bangladeshi (a little better but still much exploited by dirty local and international operators), the Africans (most still in extreme poverty). It is easy for young (in age or intellect) conservatives and wide-eyed “anti-socialists” (that silly “globalism equal pro-China” belief again?) in the US to rise up against globalism, but spare a thought for those poor who are still outside the door of modern consumerism. And rich countries’ governments take note, it’s easy to willy-nilly lockdown citizens for one or two new covid-19 cases here and there, as in New Zealand and Australia, when you can print or borrow money, or both, but spare a thought for the poor places who cannot do those fancy financial steps without severe economic consequences.
An additional way, new for the last thirty years starting with Japan, to keep long term interest rate low is for the central bankers to buy government bonds (that is, debt) in the market place from banks and the like. Doing this openly sends a strong signal to keep rates down. Alas, at the end, governments will still be deeply in debt and a great part of this, a third to a half say, is owned by their own central banks. See the hilarity? Half the right hand owes money to the left hand. When the debt becomes ridiculously high and no economic growth would bring enough tax in to retire any of it, well, one may be tempted to monetise that part of the debt, squaring things, washing them out from the balance sheets of both the treasury and its sister the central bank. That part of the debt would go up in thin air, vanish like tobacco smoke (pardon, marijuana smoke). All that’s left is the huge extra cash in the system. Inflation and exchange rate mayhems as a result? Well, if everyone else (rich everyone else, that is) does it, and if there’s still spare world-wide production capacity, then there’s a chance that the inflation monster and the currency mayhem won’t eventuate. Just. So let us pray. Especially if you own the reserve currency like Yanksland.
The caveat is, of course, that can only happen in the rich and powerful part of the world. If you’re poor and weak then most of the above tools and opportunities wouldn’t be available to you.
What one needs to make globalism better for the world is to make it (globalism) a more directed cause, rather than a free-for-all approach that was prevalent until covid-19. We need less mindless consumerism (mass air travel anyone? Pay an eco levy when purchasing an air ticket, say a 100% loading, that might help - as along as your government is not corrupt) in the rich world and a necessity-focused counterpart, at a much cheaper price, in the poor world: low-cost mobile phones for a ten year old kid in Zimbabwe to check facts and figures, or read a page or two of decent texts (written by who, ah, another conundrum!), say? That means less profits for the boys and girls in the US, Europe, China, Japan, India and sundry, less government corruption, and more generosity from the wealthy populace. Sit at home more often and give money to Médecins Sans Frontières? Ah, what an unrealistic fantasy. The point is that, I despise the kind of ugly consumerism promoted by rich governments, bloated corporations and earnestly practised by thoughtless sheep masquerading as world citizens; but am prepared to see the jaded globalism improve itself.
There you are. The new eternal question arising from this covid-19 disaster is this: when the powerful world (I use the term powerful to include places such as China and Russia in addition to the rich) may cope well with it, the poor of the world may fall further behind. The divide will be so much deeper and wider.
In such a nightmare a guy like Biden (and his deputy Harris) is needed much much more than Trump. Unless you think a US life, whether you’re born there or an immigrant only a few years ago in the big scheme of things, is worth a thousand times life elsewhere. Heaven forbids for that kind of sick antiquated thinking, even though the Europeans (Christians all) went to bed every night with it only a hundred or two years ago.)
Climate change: and here, true to the Democrats’ form, Biden takes charge and pushes ahead with doing something for the planet (but Joe, for the planet mate, not for humanity’s sole benefits). Both sides of the Atlantic, the Asians too, certainly the islanders including the Kiwis, all must feel relieved with Biden in charge. And it’s not before time, not before time after the forever-compromising Obama and the ignorant Trump. On this major topic of our time Biden certainly puts (not that he cares!) the right-wing Australia government, led by Morrison, to shame, Morrison and the Australian conservatives who are still grappling and worming their convoluted way out to cover up their zero or negative progress in this area to date, sadly. Boy, don’t these mealy-mouthed pollies love to talk, no matter how excruciatingly long-winded and sickeningly self-serving, in order to continue their wages and benefits and the vey fat juicy defined-benefit pensions later on, courtesy of taxpayers.
Other issues: I have to say I’m even more surprised at Biden’s boldness and forthrightness the last three months. To count them: Iran: prepare to talk, together with the Europeans, but not giving anything away; a warning or two, with action, to the Saudis; a warning to Netanyahu; an empathy for the suffering Yemenis, maybe with some positive action; keenly looking at the present killers in Myanmar; and on the issue of the Armenian genocide: after so many years of evasiveness an acknowledgement that the French parliament had already declared all the way back in 2012 and enforced harder in 2016. Wow, Biden is one hell stronger, bolder and straighter than the younger and much more mealy-mouthed Obama – never mind, of course, the junior Bush.
Two elephants remain in the room, both pink and huge. There is this issue that is far more important to the Yankees than to all others combined, and that’s saying one hell of a lot – look at the above again. And that is the gun control. No one understands this crazy laxity in the US, bar none! No one. The only one in memory that had made a positive contribution in helping Americans reduce killing each other with guns was Bill Clinton a quarter century ago – he put “quasi-laws” on some control of gun ownership in place; quasi-laws, because they expired later on. And you know what, Obama, that treasure of the liberal and the left, never successfully resurrected those – a glaring deficiency for his legacy, what little it is; whether his hands were tied or otherwise. The point is this, I like Obama as a person, because he is thoughtful and learned. But he was an exceedingly weak US president. And was exceptionally complacent in the first two of his eight-years at the top, when the Democrats controlled both Houses, because no major legislation was put through then. No health bill, no gun bill, no Guantanamo bill. Wow, talk about opportunities missed.
The other elephant is, of course, the US health system, the most wasteful, the most self-destructive and self-serving in the world, bar none. And practically the most corrupt. Where the largest amount of money, public and private, is spent; and the least is delivered in the OECD world. Wow again, talk about idiocy and shooting yourself well and proper in the foot.
These two last points will define the legacy of Biden - assuming all others being equal/neutral from here on. If he does more than Clinton on gun, then he would be considered a great POTUS. If not, he’s still OK, not a bad one, certainly better than Obama, same level with Clinton, not quite as Reagan in terms of net achievement on balance from both the left and the right spectrums. But, as said, if he puts in a real effort on guns, something close to what John Howard did in Australia back in 1997, a tiresome conservative guy I quite dislike but his gun-law effort still deserved respect, same as introducing the Goods and Services Tax, a direct tax, in this country. But Australia is a lot easier as regard guns than the US. If Biden manages to cut the gun ownership by half, and the gun death rate to follow down, then he would rank alongside Roosevelt and Lincoln. Perhaps that is too much to expect in the vast complexity of the modern world.
I know I know, his policies, to date or in the future, may come from a group effort rather than anything personal. Maybe he’ll be unwell and have to retire early (and Harris will take over, and my economic self will have a royal battle against its political bed partner). Maybe he lets Hunter do something really shameful and stupid, destroying his career at the peak. Maybe maybe. I understand a little of risk and uncertainty, and thus will have to wait and see.
But I am starting to like him a little, just a little, for now – economic bone-dry notwithstanding, the Goddess Aphrodite please help me.
So there you are. In the real prime cut of hard-cold history (not the pleasant convoluted book-worm sort), of the realpolitik of life, it’s the final achievement, or otherwise, that counts; everything else, analyses this way and that, justifications of a thousand hues, are all side-shows. Same for the journey getting there. Journey is rather meaningless in the truculent scheme of things. Journeys, side-shows, are the forte of history by the books and the classrooms, of poetry and literature, where one puzzles, contemplates, loves, hates, agonises, lives and dies. I treasure poetry and literature more than practically all else, but still have to cope with the sharp edges of real history and their consequences – a humble human specimen that I am.
So we will see if Biden, and Harris, will finally make the US a more humane bully boy (that is, better, if that’s the right word, than all other bully boys – still a bully boy, sadly), or not.
Long Vo-Phuoc
autumn 2021
In the interest of balance & fairness
A few months ago I posted “Pot calling the kettle black” (February, “A Contemporary Landscape” page – see links at left or the page above), lamenting on the racism that people with Chinese appearance suffer in many parts of the world these covid-19 times – Europe, the US, Australia, Asia …
Incredibly (predictably?) in many parts of China the same odious treatment has been meted out to Africa- and Europe- heritaged people who live in or visit the country. That has been reported in many forms of media, digital and print.
I should have posted earlier this follow-up to my first blog on the matter.
Here is an image of a McDonald restaurant in Guangzhou banning black customers from the place, in April. Outrages soon followed, and many, McDonald corporate boys/girls and Chinese government officials included, had said sorry for the racism. (It’s a moot point to ponder the sincerity of such, … well, just like the perfunctory apology from the racist Paris tabloid in February.)
Ah covid-19 … is it a revenge from the nature so as to bring out, among other things, the worst of humanity, its basest instinct and its grandiose self-importance?
(By the way, it now looks like, dare I say, this early junction in time, Sweden is achieving “herd immunity” as it has hoped for, (my blog "Sweden, that fair land" written April 2020, below) whilst Europe is suffering a second wave of infection. Source: https://www.worldometers.info/coronavirus/country/sweden/).
On another subject, the US presidential election is coming up. In connection with it, what puzzles me always the last few years is this: why on earth are there woman immigrants in the US going all out to support Donald Trump? One or two of his policies, maybe (in the eyes of those), but being fervent supporters of the guy?
Wonders of humanity never end. (As in, too, why couldn’t the Democrats pick someone more energetic, more exciting, more knowledgeable, more able, more free, much more free, of baggage on the back, than Joe Biden? Because they were disappointed enough with Obama who had all of those characteristics but in the end had achieved very little? Well, go ask Benazir Bhutto too, sadly, may she rest in peace - always liked her.)
Long Vo-Phuoc, September 2020
The Hypocrisy of It All
Let’s have a break from covid-19, from how to restart the economy, how to reconcile the eagerness of Wall Street, exorbitant techies and tech-wannabes and all, with the struggle on Main Street, how to deal with this “bad” recession, a recession where one loses job from government action yet price of assets stays high, higher, courtesy of unintelligent central bankers copying each other round the world, let’s have a break from all that. For me, I'd have a break too from fond reminiscences of good old friends (as in, they being much older than I am), my Nga and Nicole of North-East, two exceptional ladies of yesteryears.
Let’s have a break, shall we, and ponder instead on the injustice and hypocrisy of this world – a world where George Floyd was another sad statistic from racism, institutional or otherwise, in the US (yes, the US who always loves to teach the world the fine things of liberal democracy, fair play and respect for human rights). And of course not simply in the US. Racism is practised everywhere in the world, by the prejudiced weak as well as from the hand of the powerful, causing death and immense suffering to the oppressed. Not simply in the US, but also in China, Russia, Europe, India, Viet Nam, the rest of Asia, the Oceania, the Middle-East (did I mention the rest of Asia already?), Africa (yes, Africa, where the oppressed are abundant), Canada and Latin America (and who knows, maybe even in Antarctica where a few dozen souls reside), rich countries, poor countries, all.
You know, whilst writing the above I got up from the desk and went and searched for a piece of historical evidence. Found it. The photo below is the scan of an original shipping bill of (drum rolls please) sixteen chests of opium - OPIUM - from Bombay, India, to Hong Kong, China. In 1883.
In 1883 the British thought they owned more than half of the world. They certainly thought they owned India and Hong Kong. The British Empire actively sponsored shipments of opium to China for commercial profit and for making the Chinese addicted, stay dumb, so that the illegal occupation and exploitation of the land could continue.
(This practice was employed by the French Empire too. The French ensured full supplies and sale of opium to the Viets – sad cases of addiction abound throughout Indochina, Ha Noi particularly. One murderous colonial Empire copied another in earnest.)
Remember the Opium War the British waged on China in 1839-42? The war whereby the British declared on Imperial China because the latter objected the way the former poisoned its (China's) people via opium. The British won the war, courtesy of good strong gun powder, ate up Hong Kong, grabbed China’s treasury gold (war reparations, for heaven’s sake!) and commercial concessions, and happily continuing the task of killing the mind and body of unfortunate Chinese with opium.
(Twenty years later the French joined the act, ganged up with the British to wage war again on China for opium trade further South; and won again. Who said the nasty strong will lose out at the end?)
I know, time goes on, people change (for the better?). Look at Germany, 90 years on from the nasty 1930s/40s. I know, I know. The British now behave a little better. The Belgians now behaves a little better since chopping off the Congolese’s hands by the millions one and a half century ago. Maybe the French too since Dien Bien Phu and Algiers. The Spanish, too, perhaps, since mass murders in Maya and Inca. The Japanese too, since Nanking? And will the Chinese ever, ever, be kind and respectful to the Tibetans and Uighurs? The Russians to the Chechens? (The Viets never to the Chams, by the way).
Thus I would suggest to modern Western historians and film makers of period documentaries, don’t be so wide-eyed, so ebullient with imagined reminiscences, imagined romanticism of your ‘glorious” past. Niall Ferguson, say. Try not to be too proud, too sentimental, about the scope and achievement of “his” British empire. Think of the poor Chinese since early nineteenth century, pouring hard-earned copper cash down the drain (really, up the smoke), in a dirty opium den, losing mind, body, livelihood, so as to ensure the British stay strong, stay rich, in the global stage of the nineteenth century. So that Ferguson can be proud of his ancestors in the twenty-first century?
Yes, any time the rich world stoops down to social or institutional racism, any time the rich world lectures on the war on drugs, on being pure and high-minded et cetera, any time the rich world does that think always of that cheap dirty war of 1840. (And of course I would say the same about the not-so-rich world: China, Russia, India, and so on. True, history is not all about the last five centuries; it does stretch back to Sumer and beyond. Ah, the tos and fros of human affairs, clouding one's mind. Just as bad as trading the market - for every positive side for an action there is always a negative side to worry about. I'm becoming tired of the very useful word "net", as in "net result", "net benefit", et cetera.)
By the way, I treasure very much that original 1883 shipping bill of mine. A “lovely” record of history, of ugly colonialism. I suppose when I am down-trodden with cash I would put it up on ebay and get a few dollars for it?
Hmmm. If and when so doing I would sure think of the irony and the hypocrisy of it all.
Long Vo-Phuoc, June 2020
Well, I never had imagined ...
... that it would come to this - they are giving away oil on the streets of New York and Chicago, plus 13 USD for each barrel of the black liquid, no less, right now. An hour ago the extra gift was 40 USD. (Ref: deliverable Crude May futures, Nymex, and related CME May futures. News: world oil demand is estimated to drop 30% amid oversupply.)
And you can have millions of such, with the cash thrown in as said. But you have to store them away, them barrels are big you see - but where you go to for a lovely empty warehouse (apologies to Peter Sarstedt)?
What will history and future generations think of this giant folly of the twenty-first century, this total world-wide, self-inflicted, shutdown depression all because of a mass scare?
Wake me up when this idiotic dream is over, when loud-mouthed self-important scaremongers finally shut up (or will they ever?).
Long Vo-Phuoc, April 20, 2020, Chicago time
Sweden, that fair land
And now Sweden does it again. In this time of hyperbole, of busybody “governments” who chop and change tunes by the hours (depending on what ready advice they get), of panicky central bankers who know nothing of what to do except throwing, printing, money and to hell with consequences a few years down the track, yes, in this time of so-called “lockdowns” (an ugly, ignorant and insulting word – “shut-down” is more to the truth), in this time of such idiotic goings-on, Sweden elects to continue to respect its citizens, its taxpayers (its bosses, in all constitutional frankness) and not to “lockdown” anyone.
(see full articles in "Blobs" Page)
Long Vo-Phuoc (early April, early autumn, Sydney, 2020)
It's wrong ...
It is wrong and ignorant - not to mention hubris - to shut a whole economy, a whole people, down, because that is against human nature, against nature itself. It's amoral. Nature is about living, mutating (some play with the word "evolution") and dying. Human nature is about living, fighting, seeking liberty, and yes, dying too.
Even during the worst of war (take your pick from the last hundred years, the European War 1914-18, the World War 1939-45, the American-Vietnam War 1960-75, the Congo Wars, the current Syrian War, take your pick - nasty endeavours all) the underlying economies were still kept alive amid the conflict by the belligerents, bloody-minded or otherwise.
The first law in war, incidentally, is not to shoot yourself in the foot. The first law for good government of a nation is quite simply: first, do no harm.
So listen up and listen hard wannabe authoritarians of this flesh-eating human world - you've really got no idea.
Long Vo-Phuoc, March's end, 2020
Our World in Data
A comprehensive, factual (with sources) and balanced article on COVID-19 has just been posted by the good folks at OurWorldInData:
https://ourworldindata.org/coronavirus
(By the way, in a much narrower scope, Vix reached 50 level on Friday, retreated a little, but likely will be there again tonight. Fear is making a visit to 2008.)
LVP, 9 March
Perspectives
In the interest of the above, I repost the following 7/3/20 article from Reuters (www.reuters.com). Read it and do some thinking, whether you are a fad-conscious mask-donning individual ever ready to get into a panicky mode, a silly but greedy corporation eager to please the so-called authorities, or a heavy-handed or populist, or both, dictatorial or so-called democratic, theocratic or secular, small or large (or any combination thereof) government, or a self-described liberal State in the US oh-so-eager to resort to locking up (quarantining is the deceitful word) citizens for no good reason (the 1930s in Germany and the Soviet Union all over again?). Read it, not to go out and selfishly buy thousands of toilet rolls (toilet rolls, for heaven’s sake), and be cool. Say it again, learn something and be cool.
Long Vo-Phuoc, March 7, 2020
Factbox: How we die: coronavirus in perspective
LONDON (Reuters) - As the new coronavirus spreads and worldwide deaths linked to it top 3,400, global alarm is growing and has caused everything from consumer runs on face masks to mass school closures.
Yet while few would deny the outbreak’s official status as an international health emergency, in the ranking of top causes of death it pales into insignificance compared to heart disease, cancer, road accidents, suicide or homicide.
A few figures:
TOP KILLERS
The top killers are cardiovascular diseases (CVD), everything from hypertension to strokes. They were to blame for 17.8 million deaths in 2017, roughly a third of the 56 million total deaths recorded that year.
Cancers also loom large, accounting in total for 9.6 million deaths. Respiratory diseases and infections together claimed 6.5 million lives.
Dementia, digestive disease and diabetes all take heavy tolls. And despite recent progress, HIV/AIDS claimed some 942,000 lives in 2017 and malaria 620,000. Seasonal influenza epidemics kill between 290,000 and 650,000 people a year, the World Health Organization says.
RISK FACTORS
Viewed by risk factor, high blood pressure was linked to 10.4 million deaths in 2017; smoking to 7.1 million; high blood sugar to 6.53 million; air pollution to 4.9 million; and obesity to 4.7 million.
Everyday life presents other risks. Road injuries proved fatal for 1.24 million people in 2017 - 3,400 a day.
Suicide is another big cause. Close to 800,000 people die due to suicide every year, or one person every 40 seconds, the WHO estimates. It cites evidence that for each adult who died by suicide, more than 20 others may have attempted it.
There is also violence. About 464,000 people across the world were killed in homicides in 2017, surpassing by far the 89,000 killed in armed conflicts in the same period, according to the Global Study on Homicide 2019 published by the United Nations Office on Drugs and Crime (UNODC).
Sources: UNODC, WHO, the Global Health Data Exchange of the Institute for Health Metrics and Evaluation (IHME)
Reporting by Mark John; Editing by Janet Lawrence.
Pot calling the kettle black!
I’ve noted recently from news sources (Guardian, BBC, Time ..., search for “coronavirus racism”) that xenophobia has been on the rise around the little planet. A French local tabloid, Le Courier, “used the inflammatory headlines "Alerte jaune" (Yellow alert) and "Le péril jaune?" (Yellow peril?), complete with an image of a Chinese woman wearing a protective mask.” (as reported by the BBC). Hmmm.
It seems that these days a Chinese, an East Asian, can be fair game for the panicky mobs to whine, to sulk, to hate. Where are these mobs’ beloved mummies for the milk one wonders. And speaking of “Le péril jaune” in Paris, now now, it’s not as if the Russians are fighting the Japanese on the Yellow Sea from the 1905 days all over again, is it? Wake up from your slumber, young Frenchies.
The tabloid apologised, but the purpose had been fulfilled, the French public had understood the message well, had heard of the tabloid's appeal to their basic instint. And the ugly sentiment has repeated everywhere these last few days (the US, see TIME; Britain, see The Guardian, 2 Feb; the Netherlands, see DutchNews 6 Feb; Italy, see Guardian; many other places ...).
It’s time to pass on a few quick facts of life to xenophobic commoners in small-minded Western (Eastern too, for that matter) enclaves, large and small:
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There was this Spanish flu of 1918-20, so-called because Spain was a neutral country in WWI, thus the media then and there were less suppressed than in those countries that were heavily into killing each other at the time, leading to the misnomer. It originated from France, from a dirty army camp by all accounts. It caused 50-100 million deaths world-wide, infecting 500 million;
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On the subject of death, read history books of the plagues that came from Europe: the 1720 Marseilles (100,000 died), the 1665 London (100,000), the 1629 Italian Mantua (280,000), the 1347 Europe-wide Black Death (50 million, no typo), among many others. Really, in the 14th century, and for a thousand years before that, Europe was nobody on the world stage – a place very dirty and very deadly. It's all relative you understand, and a thousand years are not a big thing since humanity started writing in Sumer (well, learn about that too when you’re at it);
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Of course Asia itself was the origin of many health disasters: the last century saw the 1957 Asian flu (1 million died), the 1968 Hong Kong flu (1 million). This century of consumerism saw the 2003 Chinese SARS (774 deaths, yes, less than 1,000) and the 2012 Middle-Eastern MERS (512).
Let me say it again, 50-100 millions died from the Spanish flu only a century ago, a real pandemonium directly caused by a European war, but less than 2,000 poor souls perished from SARS+MERS+#2019nCoV (to date, 7/2/2020, and if the Chinese are not under-reporting the latter – but even if they are ...). The common flu killed 1,200 in the US in the first four weeks of 2020 (source: gis.cdc.gov).
The point is that anywhere through history can be a place to start an epidemic - a bad flu, a bad plague. That is a natural result from interactions between human and animals (the former killing and eating the latter, that is) and other parts of nature, and humanity, in a real collective sense, is usually the cause or the contributing factor of all. Sometimes that can't be helped, a natural order of things. But the more the human species consumes (in a broad meaning of the word), the more the black hole on its face is fed, the more a disaster threatens to manifest in all its gory glory (yes, war certainly is included here).
So, if you like, by all means be concerned and take precaution, but avoid the racist xenophobic game, Western or elsewhere. It’s low, nasty, boring and it well betrays your own ignorance. Most importantly, it’s unproductive for your wallet and the economy. Learn something and be cool.
I am not Chinese, nationality or heritage, never been to mainland China. And true, it's not easy to like the way the average Chinese tourist goes places and throws money around without learning appreciating a thing, either; but that is also true with the average Australian tourist, the American Yank, French, British, German, Dutch, Swiss, Russian, Japanese, Korean, Indian, Saudi Arab, etc, at different times, different places. It's human nature, sadly, especially of one who becomes relatively rich not through learning and understanding. Ask yourself very honestly, do the average Western tourists, say (often pretentiously self-described as travelers etc.), know anything about the non-European/non-US places that they’ve been to, anything more than a cheap guidebook a basic school lesson? Luxury tours, budget tours, all. The more things change ...
As such, the above is in the interest of fair play, on point of knowledge. And because I despise that lowest, basest trait of humanity – racism.
Long Vo-Phuoc, Feb 2020
Paul Volcker
Paul Volcker died last night Sydney time, ending a life of achievement at the highest level of central banking governance and exemplary personal integrity. He was respected by all, whether Jimmy Carter whose presidency was affected by Volcker’s policy (but Carter later bravely said the policy was “the right thing to do”), or Reagan, or Obama much further on.
He was tough, battled both the huge stagflation monster from the late 1970s into the 80s (CPI 10% - 25% p.a. for years in OECD countries, higher in emerging economies) and the ugly, albeit necessary, demon that was capitalism (the nasty Wall Street greed and panic, the bloated American trade unions at the time, and the always, always, self-interested and self-absorbed nastiness of politicians and bureaucrats).
By and large, he won.
Greenspan, Bernanke, Yellen, Draghi, Kuroda never learnt an iota from him, and they badly needed to. Let’s hope Lagarde will do some learning, as should young chaps such as Lowe in Australia and similar sundries around the globe (again, so far they learnt zilch, ignorant office boys and girls all). The way things are at the moment, with zero and negative rates and the odious so-called quantitative easing, with sky-high asset prices, with selfish and narcissistic politicians, fatcat bureaucrats and greedy corporate boys/girls, with consumerism at fever pitch world-wide (consumer tech & other goods and pointless cheap plane travel ruining the planet), well they all need to do plenty of reflection on Volcker.
(Powell, by the way, is interesting, and deserves more time down the road for judgment. So far so good: keep on ignoring uneducated nonsense from Donald Trump, that’s the way to go. The same as regard Wall Street and its numerous el cheapos; even though, lately he seemed to be pushed around a little by those money boys. Have a strong heart and a bit of steel in the mind, that's my advice.
So here’s a toast to you, Volcker, best wishes for the journey to the other side, if there is such a thing. Cheers. You have made a fine example for all practitioners of capitalism.
Read more on Volcker’s death viz-a-viz, say, reuters.com
Long Vo-Phuoc, 10 December 2019
(Image: AP)
Nostalgia
That week I was fairly neutral in the market, perhaps a little long, but substantially short volatility. Why? Because on the latter I thought the downside, and the resulting panic, in equity markets especially in Australia had been overdone since the mini-crash. Yes, Friday October the 13th, 1989, due to the breakdown of the US airline UAL’s buy-out, all for USD 6.75 billion (big then but a puny amount in today’s corporate shenanigans). Frankly, who cared? A bunch of greedy desk-bound working boys who couldn’t agree with each other and thus couldn’t get the needed credit (probably from Japan). As I said, who cared!
Thus I was prepared for a relatively long fight with my position against the market from early November to the end of December, a whole aeon of nine weeks, no kidding. That late spring 30 years ago, I was relaxed enough (it’s all relative) whilst watchful on things on the screen, ears and mind listening to happenings in Yankland and, yes, in Europe too: the Soviets seemed a little less stiff, glasnost and all, than they used to be, and the Berliners, the East Berliners, well, they were demonstrating, believe it or not – copying the Polish a short while ago. Making noise, nothing was violent just yet. That was a change, a rather surprising change.
I was always interested (still am) in happenings of geopolitics. Fascinated to the nth degree. I looked again at the size of the Soviet Union in my big sophisticated New International Atlas by Collins, 1982 edition (the second last edition before the expensive endeavour for 15 years was abandoned). Is it possible, the mean-spirited KGB bunch and their acolytes the Stasi boys, is it possible that these nasties really tolerate the East Berliners complaining without putting them all in prison, to say it mildly?
Well well, what has the world come to? A nirvana of peace, or the old crushing and shooting a la 1956 Magyar and 1968 Czecho?
So, Friday the 10th, down-under, a little tired getting out of bed, too much work and tension the whole week. Didn’t bother ringing the brokers for news. Kissed my wife goodbye. Grabbed the Fin Review, glanced at the headline, nothing of real interest, old news by at least half a day.
Opened the door of the office, no coffee just yet, turned the little Reuters screen on, green monochrome thing. Typed in the code for Wall Street commentary, MxxA (don’t remember the middle two letters), hit enter.
And bang, the Berlin Wall had been breached, and no one had died. Wow.
Lighted a cigarette. Wow. The biggest event of the world since the Vietnam War. Bigger than the Vietnam War. Let’s say it again, the biggest thing since World War II. The Wall, communism and its economic model, had fallen.
Wow, forget Wall Street and the Ftse for now (the Wall fell at night, no real impact just yet), forget position for now. Just imagine if I were a German, a Berliner, how would I feel. Is that peace or not? Is that elation, is that happy delirium?
I had never felt anything like that with geopolitical things.
So, here’s a toast for all those Germans of November 9, 1989. Cheers, mates. Prost. Things have not always gone on a straight line since (yet you haven’t done too badly), but the Wall was down that day and you guys should always, always, be happy - thinking back.
Prost again.
Long Vo-Phuoc, 10 November 2019
(Image: Reuters)
Astounding diplomatic secret leaked
I am shocked. I’m beyond shocked. My trust in the cyber security of the free world (it’s all relative, you know, the “free” thing) is completely shattered.
(By the way free world always means free decent press, or so I have believed. So what can one say about the recent raids of the Australian Federal Police on Australian journalists’ home and office recently? And absolutely no question of national security being compromised whatsoever!)
Back to this, no, I am not talking about the email remarks of the British ambassador to the US. That is (i) old news, (ii) no big deal, they are what learned people round the world think about the current head of the biggest most muscular economy in the world, anyway. No no.
It is this: a top secret memo to Donald Trump from the American ambassador to Great Britain is now wide in the open. And it’s full of outrageous comments from that Yankee diplomat on the (admittedly equally outrageous) social etiquette, and more, of British leaders (three in all, lame-duck and wanna-be) AND the queen of England. Wow. You really have to read it in full, NOW, while it’s hot; as it may soon be suppressed by security agents and police from the free world, this country included.
So I print the whole thing from the Economist, below, hot in its July 11 edition. I am a full subscriber. The newspaper shouldn’t mind, in the name of free press (there you are, that tricky “free” word again).
I haven’t come across such a big leak since I somehow got a note on the Swedish literature Nobel-prize judges in 2016 (still surprised that my post of “2016 Nobel Prize” (Blobs page) on the leak hasn’t yet been wiped out by the spooks).
Long Vo-Phuoc, July 2019
Top Secret!
The Economist has seen leaks from the US ambassador in London
You think the White House is “uniquely dysfunctional”? Try 10 Downing St
Monday: Today Theresa May came over. Said she wanted a trade deal to cement her legacy before she quits as prime minister in a couple of weeks. I told her Britain would need to accept our food standards, and gave her chlorinated chicken to show her how delicious our traditional American chow is. I think she liked it, and she has nice manners: when she clears her throat, she lifts her napkin up to her mouth and coughs straight into it. She seemed sad so I gave her a couple glasses of bourbon, which may have been a mistake: she put on “I will survive” and started dancing with one of the security guys before collapsing into a tearful heap. Mrs Johnson put her to bed in a spare room.
Tuesday: Today Boris Johnson came over. Remember him? The guy with weird blond hair who makes no sense…never mind. Seems he’s taking over from Theresa. You don’t have to get elected by the people to be in charge here, just by the Conservative Party. That’s 160,000 old right-wing men. Interesting system. You might want to look into it.
I told Johnson that I was struggling to get my head around his position on whether Britain was going to leave the European Union with or without a deal. He muttered something about “having your cake and eating it”, so I ordered tea and crumpets, as the State Department’s British etiquette handbook recommends. He polished them off, saying he hadn’t had a square meal in weeks, and asked if I had a spare room. Apparently he’s had woman trouble, so I’ve put him up for a few days. I figured you’d sympathise.
Wednesday: Today Mark Carney, the Canadian guy at the Bank of England, came over. I didn’t follow every nuance of his analysis of the economic consequences of a no-deal Brexit, but it involved four horsemen and a substantial number of plagues. He is a great fan of yours, sir, and said something about ensuring the current expansion was not brought to an overhasty close by injudicious monetary tightening. He also mentioned that he’s looking to move to a new job in Washington and wondered if you might be ready to put in a good word. I ordered some tea and crumpets, but he didn’t touch them. I guess he’s too small to carry any extra weight. He’s kind of hanging around looking hopeful, so I’ve put him in the waiting room where I keep old copies of The Economist that nobody has read.
Thursday: Today Jeremy Corbyn came over. He’s the communist with the beard who vacations in Venezuela. The political counsellor tells me that he’s probably going to be pm soon, after the blond one goes down in flames. Nobody likes him, and his party got only 14% in the recent elections, but I guess that doesn’t matter here. I ordered tea and crumpets but he said he would prefer carrot juice.
He lectured me about Labour’s position on the terms of a trade deal after Brexit. Sir, I know you said that health-service provision should be “on the table” in a deal, but if Corbyn’s state is anything to go by, I don’t think we should touch it. In the middle of a speech about how the workers, united, would never let America take over their National Health Service, he suddenly collapsed on the carpet, clutching at his heart. Turns out there were rumours about his health, so he went and did a photo-shoot working out in a park with Rihanna’s trainer, and it’s been a bit much for him. I called a (private) doctor and put him in another spare room.
Friday: Today the queen came over. I asked the staff to bring tea and crumpets, but she gave the crumpets to the corgis, waved away the tea and ordered herself a supersized gin and tonic. We’ll need to get the etiquette handbook updated. She put her feet up on the couch and said that, because of our special relationship, she felt she could confide in me: the country was going to the dogs, the Scots would get their independence, Northern Ireland would end up joining the folks in the South and even the Welsh were restless. She didn’t think there was any point in being monarch of Britain if it wasn’t Great any more.
She was kind of wondering whether we could put aside that difficult episode in 1776, and thought that she might get a gig with us. I said it could be tricky, what with her being British and all, but she’s a very determined woman. She tried the line that she had a half-American great-grandson, and then said she’s got a great place in Scotland you could have. It has room for lots of golf courses and she’d make you a Thane. Now she seems to have dozed off. The etiquette book doesn’t say what to do with monarchs who are snoring on your couch. Could you ask Ivanka? She’s good with awkward social situations.
This article appeared in the Leaders section of the print edition under the headline "Woodygate"
Bad movie, terrible actors
Notice anything unappetising in the image below from a movie made only a little more than a month ago? First, the dress code: uniformity to the extreme of boredom. Second, the age and hair of the actors: almost all late middle-age, balding, tiresome to the point that brings tears to your eyes. Third, and much worse for those with a discerning taste: all actors were blokey – no woman in sight, at least to my eyes (with glasses on). And this isn’t even an old-fashioned war movie, good heavens, no. These guys would never go to wars, would never be war movie actors, too much hard work for them.
The movie’s theme was a high-minded Globalization 4.0 (implying “shaping a Global Architecture in the Age of the Fourth Industrial Revolution” with all “the global elites”: these are the movie producers’ words, not mine – wow, speaking about noisy empty bullshit).
You don’t know the movie? It’s called “Davos 2019”, and I’m sure you are familiar with the actors: pollies calling themselves leaders from 50 countries, fatcats from big corporations, empty-minded but commercially astute techheads, plus their hangers-on in the thousands, and not least the media circus.
On the International Women’s Day this year, today, have an ironic laugh at the ridiculous talkfest and read the following Guardian article, a review of a non-fiction. Image from The Guardian Weekly , print edition 1 March, pp 58-59, I am a print edition subscriber, trust the newspaper doesn't mind.
Long Vo-Phuoc, 8 March 2019.
Standing up to bigotry
Scanned image of article from The Economist, print edition November 3-9, 2018, p. 25.
I am a print & digital subscriber, trust the newspaper doesn’t mind. The link is https://www.economist.com/asia/2018/11/01/pakistans-supreme-court-acquits-a-woman-accused-of-blasphemy
Long Vo-Phuoc, November 2018
The puny tax paid by the big techies
If you look at how wealthy countries such as the US, Australia, Germany, Britain, etc., have to scratch around, in between domestic political infightings, for more hard-earned money from the individual taxpayers in order to pay for just causes (extreme poverty, education for the neglected, depraved environment ...), huge bureaucratic wastage and massive policy errors notwithstanding, if you look at all that you would feel quite angry at the big techies’ tax shenanigans: Google, Facebook, Amazon, Apple, and similar. A fair share of tax is never in their corporate vocabulary. Year after year, the boy owners of these firms cheerfully employ an army of accountants and lawyers using odious means to cut their world-wide corporate tax obligations, cut cut cut ...
I am a taxpayer, never a recipient of a social benefit. I started paying tax in full progressive percentage terms, full corporate tax, when these billionaire tech owners were still busy wearing out the back-side of their shorts in primary schools, in fact before some were even born: Zuckerberg, Brin, Page, Musk (Tesla still losing money, thus no tax, but Musk is a billionaire tech boy), Bezos, etc.. These are boys from the US, there are similar boys from China, Australia, the EU, boys owning big-cap big-profit puny-tax techies.
Now you shouldn’t think these boys are so clever – or creative or knowledgeable in any sense. Because they most certainly are not: a few lines of computer codes here, a few lines there, all to further the social media game, the consumer retail game, leveraging cohorts of university leavers in the process. I sure would never think those codes are any deeper than my APL-coded actuarial operating model for a full commercial disability-income system in the early 80s. Or how about, later on, an “arbitrage” (“spread” is a better term in a risk sense – there really is no such thing as arbitrage, ie. risk-free) interactive model for price and implied-volatility between macro asset classes and between macro or micro subsets of an asset class. The model worked not too badly until retirement, accompanied, as it must be in these things, by a large amount of stress, risk-taking courage and market perception; and an appreciation of history, that too, always.
In a relative sense, thus, the big tech boys are not that clever, far from being necessarily creative or visionary, never mind artistic or courageous. They have simply been lucky with the times, most are clever in business (Gates with his DOS purchase (mentioned only incidentally here, Gates’ Microsoft not part of this group, paying tax reasonably full), Zuckerberg the way he grabbed most of Facebook at the beginning), and all are always greedy for power. I’m not that annoyed really, mind as calm as ocean surface on a clear day, but frankly these techies should pay up their tax in a fair and big way, global-wise. And if the share prices have to drop to compensate the reduced profit, so be it. Good heavens, as said the techies are simply a bunch of codes for the most parts. Wide-eyed shareholders – retail speculators, hedgies or clumsy mutual/index/sundry pension funds, well, need to always take note on these sorts of things.
(And, by the way, boys and girls, young or old, you shouldn’t excitedly carry on too much about the future being all about tech, all about codes. First, I read science and science-fictions more than most of you. Second, there have been no evidence in history (read human history) that points to complete global domination in the future by a single predictive factor - be it AI, in today's terms, or otherwise: we’re all in the dark here, now, as we have been at any important past junction of history, whether we are tech, non-tech, or somewhere in between. Third, much of the tech in reality nowadays is about consumerism and social media, hardly history-altering stunners. Fourth, and this relates to the second, there is no such thing as “this time is different” in history: remember the 1999 dot-com idiocy or the 2004-07 US property casino? (These recent investment market examples show of course only one facet of history, but it, the market, is a major part of the modern, materialistic, world, and tech and money and the market are so tightly woven together that you would be silly and dishonest to try separating them in order to serve an argument.)
Want more misconceptions on other facets of life? Recent ones, to be relevant? How about the fervent and largely misguided anti-communism stance of the US in late 1940s and throughout 1950s, ugly McCarthyism and all, leading to the US’s lamentable and futile support of France in the latter's final, odious, murderous, colonial war in Viet Nam (final, in Viet Nam, but not in other parts of the world), culminating in the Dien Bien Phu disaster. And soon later, much much worse (how was it possible?), the epic tragedy of its (the US's) own Viet Nam war which ended in 1975.
How about the free world’s inflated and irrational fear of the Soviet Union military prowess in the 1970s and early 1980s: the fear that the US would be crushed by the Soviets in either a conventional or nuclear war (really!) – even as the powerful ultra-hitech blue-water navy that circled the globe undisputed belonged (still does) to the US. Contemporanous books abound on this fear, from detailed scenarios offered by former NATO generals on a probable (!) Soviet invasion of Western Europe (eg. John Hackett, The Third World War, 1982), to excellent thrillers by le Carre, Deighton, and so on.
Still the Soviet Union fell in 1991, the principal cause starkly simple and shockingly basic as it turned out: no money (ie., no real cash, no matter how many rolls of roubles were freshly printed). There immediately followed a ridiculous pronouncement: “the end of history” by Francis Fukuyama! Really, how the guy made a living – or, as now, justifies a pension – I have no idea. In saying what he said, he suddenly forgot where China existed (China with its ambition, its continuous five thousand years history, immense human resource, and a long grievance of what the West and Japan did to it for a hundred years); or where the Middle-East was. Then of course the first Iraq war came, and the second, and mayhem ...
I am a simple man, a humble man. I do not know a turn of history before it happens, whether it was 1973 when I left the old sorrowful country for an overseas scholarship, or today – AI, commercial tech boys with material dreams, whatnots.
Anyway this is only an aside, in brackets.)
The article below from the Guardian Weekly Nov 16 too is about the unsavory way, to put it mildly, the rich tech giants use to minimise tax. The writer, John Harris, is a columnist of the newspaper. In the interest of a good read, I upload it in full in addition to the link – I am a print subscriber. If the newspaper feels aggrieved in any way, simply send me a G+ message, and I’ll clear it away.
Long Vo-Phuoc, November 2018
© All Rights Reserved
http://www.theguardian.com/commentisfree/2018/nov/11/tax-big-tech-companies
Without a fair tax on tech, it could be the end of the state as we know it
John Harris
Big tech companies are transforming societies – but their pitiful contributions aren’t enough to help to help governments adapt
Alongside the results of last week’s US midterms came the passing of San Francisco’s Proposition C, a measure that will tax firms with an annual turnover of more than $50m (£44m) to raise an estimated $300m extra a year to help address homelessness. Last Tuesday, 60% of voters backed it: though the proposal is now snarled up in a constitutional dispute, its approval marks a big moment for a city whose housing crisis has become a matter of urgency.
Given the huge concentration of technology giants in San Francisco, the debate quickly became a drama about big tech and its social responsibilities. The most high-profile supporters of the plan included Marc Benioff, the founder and CEO of the software company Salesforce, the single largest employer in the city, who donated $8m to get it on the statute book. He and his fellow campaigners were opposed by a gaggle of high-ups from such companies as Twitter, the ride-hailing giant Lyft, and the online payments service Stripe: wealthy people apparently doing their bit to resist a modest boost in help for the most vulnerable, in a place whose homelessness problem is at least partly traceable to the vast increases in property values caused by big tech’s local dominance.
Such moves – joined last week by comparable tax plans in Palo Alto and Mountain View – add to the noise around two connected questions. The first is obvious: what do we do about the corporations that are driving huge social and economic change, but have so far proved reluctant to pay anything approaching their fair share of tax? From that follows the second, even graver conundrum: if things stay as they are, what could happen to just about everything that depends on government funding?
Clearly, an aversion to being taxed is hardly unique to tech companies. But in the ways digital communication and commerce operate, there lies an abundance of opportunities for light-footed firms. When you use Facebook or Google via servers that might be located in any number of places, where is the economic activity to be taxed located? In the absence of any clear answer, the tech giants have spun huge webs of obfuscation: subsidiaries that superficially trade with each other, hefty “administrative expenses”, tax discounts from employee share schemes, and holding companies based in low-tax jurisdictions such as Luxembourg, Jersey and the Cayman Islands. A patina of liberal piety – Google’s unofficial motto “Don’t be evil”, and all that – plays its part in obscuring what has been going on. So too does the endless competition between countries and cities desperate to attract tech businesses, something recently glimpsed in the unseemly spectacle of US cities offering Amazon generous tax incentives, as they competed to become the home of the company’s second HQ.
Every week now brings another proposal to somehow start to address all this, and a sense that most of what has so far been suggested falls short. Philip Hammond’s budget contained the very modest proposal to take 2% of the UK revenue from tech companies with more than £500m of global income – which, it’s estimated, might bring in as little as £30m per company. Spain is about to introduce something comparable, and apparently slightly more ambitious. In Brussels, the EU is currently tangled up in an ongoing mess about a similar proposal, driven by the French president, Emmanuel Macron, but opposed by such countries as Denmark, Sweden and Ireland.
According to analysis by the financial services company Standard and Poor’s, between 2007 and 2015 the average effective rate of tax paid in the US by the country’s 500 highest-valued firms was put at 27%. By contrast, over the same period, Apple paid 17% of its US profits in tax, Alphabet (Google’s parent) paid 16%, Amazon paid 13%, and Facebook paid just 3.8 %. In 2017, Amazon’s US profits were more than $5.6bn, yet it paid almost no federal income taxes, partly thanks to “excess stock-based compensation deductions” .
Outside the US, the disparities between takings and tax are even more glaring. In 2016, Apple paid $2bn of tax on $41bn of profits generated elsewhere, an effective rate of 4.8%. This year, a report by the new thinktank Taxwatch dug into the mess of complexity that surrounds the UK tax affairs of some of the biggest tech firms. Facebook, Google, Apple, Microsoft and Cisco, it said, generated UK profits in 2017-18 of more than £6.6bn, but paid a combined tax bill of £191m – as opposed to the £1bn Taxwatch says they ought to have contributed. In the same period, Airbnb paid a mere £600,000 in corporation tax, and questions have been asked (but not yet answered) about whether Uber should be charging VAT on its booking fees and paying it to HMRC. Meanwhile, the branch of Amazon that runs its UK fulfilment centres paid £1.7m in taxes, despite declared profits of £72m. The companies insist they abide by tax laws and pay the amounts due from them.
The upshot is obvious: while big tech is reshaping societies and economies at speed – think of what Amazon is doing to our high streets or, looking ahead, the huge disruption that could be sown by driverless transport – it gives woefully inadequate financial help to the governments whose job it is to manage the fallout. The problem is compounded by the fact that, almost by definition, tech companies do not spread their wealth via employment – and, as consequence, income tax – to anything like the extent that traditional firms once did.
The beginnings of an answer might lie in what economists call a unitary tax. In this model, firms would be obliged to give the tax authorities of any country in which they operate both a set of accounts for their global activities and information about their physical assets, workforce, sales and profits for the territory in question. Tax would then be decided using a formula based on these factors. Some state taxes in the US work on a comparable basis, and the European commission has made supportive noises about the concept.
What stands in the way is obvious: a unitary tech tax would have to attract a reasonable measure of international consensus, otherwise tech firms might move their operations to countries that spurned it. Certainly, at a time when globalism is being trumped with a capital T (the US president, let’s not forget, has already cut corporate tax from 35% to 21%, and wants to hack it down to 15%), the idea would need a massive popular push to stand even a small chance of success.
In the context of Britain, that inevitably brings us to the politics of Brexit, and how well the light-touch, low-tax dystopia promised by its advocates on the right would suit the kind of multinational giants already lobbying governments to leave things as they are. Herein lie the politics of tomorrow, and the reason why comparatively parochial arguments about how much income tax to charge “the rich” slightly miss the point. Make no mistake: very soon, whether or not big tech’s tax gap is closed may well mark the difference between a viable future, and a very modern nightmare.
John Harris is a Guardian columnist
Ten years on: the road not taken – thoughts on the crisis (written Sep 2018)
First, a recount
This month and the next, to put it mildly, was an unpleasant period for the world a decade ago. Much worse than 1987, and perhaps just as bad as 1929 as regard potential for a global disaster. In hindsight the aftermath, to date, of 2008 was quite different from the 1930s. There has since been robust debates on causes, course and effects of the 2008-09 crisis all the way to this day, eating up, shall we say, a forest cut down for paper and quite a few quintillion electrons blasted out of the digital kingdom. From a market practitioner’s mindscope the arguments were about the difference in beliefs between the two camps in the intervening years: the bears, in the minority, and the bulls. There are of course many sitting on the fence but on a broad sweep I would say more than 9 out of 10 are ‘relieved’ with what have turned out, whether grudgingly, whether secretly; perhaps 99 out of 100. One could clearly see the abyss in late 2008 approaching the windows of the trading room, everyone would fall into it if things weren’t done quickly and forcefully. The well-connected world was ready to sink into the void because no bank trusted another to do business with, and we are speaking here of big commercial banks having customers rich and poor, retail and corporates: Citi, Bank of America, Bank of Scotland, Deutsche, UBS, and many wannabes in between, never mind the Goldman or Macquarie wheelers-dealers of this world. No trust (because who knew what decomposing subprimes hidden in ‘assets’), no business, no trade, no growth, no job, no money: one would get hungry in the US, Europe, the Antipodes, Asia, Africa, the rest of the Americas. Coups and uprisings as a result, any one?
Yes, bulls and bears alike appreciate all that. The thoughtful bears especially, who were, are, for the most part decent, enlightened. Mates in the mind, the brave contrarians, if truth be told. But what’s the point if you are proven right in a world that crashes into oblivion?
Setting the political stage: money, the market and the economy
But this note is about things from a political angle, not a well-trodden market analysis. A US angle, where it all originated – putting aside for now the greedy bandwagons in Britain, Germany, Switzerland, Iceland, Ireland, Spain, Australia, and everywhere else. A US where Greenspan had kept interest rate to the minimum in early 2000s whilst growth and speculative excesses ran furiously amok, starting with the dot-com idiocy in late 1990s to the gigantic property casino in mid-2000s. When it played out in earnest the odious and dangerous game of the AAA-rating awarded to mostly no-doc no-chance mortgage loans bundled up together into money structures of huge sizes in countless numbers. These subprimes were “backed” up and justified by theoretical papers paid for by investment banks and brokers but written up by mathematicians who had no ideas of market forces or basic money management. These boys spoke of 5, 10, 20 standard deviations (things that happen once in a thousand, a million years!) yet using only three years’, five years’ data to calculate default risk (three or five years, because that’s usually all that were available). Reading these dense and verbose fraudulent papers in mid-2000s I was both amused and repulsed by the fancy advanced tools employed, concocted together by teams of naïve ignorant nerds who worked in the back rooms of banks or in university towers, who had no idea of the real world and its applications thereof. And September-October 2008 was all about the real world, nasty, big- and small-moneyed, matters of life and death in a nut shell, because this was when it blew up.
In the real scheme of things in national and global politics, it’s all about money - or the lack of it. War, poverty, hunger, riches, learning, art, liberalism, democracy, love, charity, innovation, posterity, genocide, oppression, beliefs; all squeezed down to the absolute last denominator: money, and its twin, the economy. In the modern world, these two mutate to become the market in a broad sense. Even if you’re a dictator you still need to raise money from the world to do things, at best for your country and of course at worst solely for your own pocket. Whatever you believe in, you need money. Look at the Soviet Union, China, Vietnam, how they were forced to open up. Even the democratic (strictly in a voting sense) India who tried to be self-sufficient for so long in the 50s and 60s had to eventually come to terms with market forces.
All the cash from the king
Back to the US, what could the lame-duck Bush do in 2008 who had only a hazy idea of the world (but who had started the second Iraq war)? Did he have a market-oriented treasury chap (oh so oriented, because this chap, Paulson, was once head of Goldman Sachs, a construct that was affectionately referred to as the vampire squid) in place? Tick. Did he have a Fed chappie who was eager to shower money from helicopter? Tick (this was Bernanke, an academic who since school never worked in the private sector). Was the US expected by the world to take up the baton, leading greedy humanity out of trouble? Tick (grudgingly so, admittedly, but in principle Europe was on side 100% because it too was suffering own nightmare with extra-greedy banks and notorious property speculators).
Tick tick tick. And this is what happened. The private but government-sponsored (that’s how it was defined!) mortgage lenders Fanny Mae and Freddy Mac: saved at USD 187 billion over time. Bear Stearns and Lehman were allowed to go under but AIG (huge insurance company soaked deep in derivatives contracts whilst paying obscene salaries and bonuses to trading staff) saved at USD 173 billion. Citibank came in for USD 45 billion cash and altogether guarantee of USD 250 billions, all that in exchange for USD 27 billion preference shares at 8% (!) to US Treasury. Bank of America USD 45 billion cash and USD 300 billion guarantee. Everyone else dipped in: Goldman Sachs, Morgan Stanley, JP Morgan, Wells, State Street. Hundred of smaller players, tens of billions USD, billions USD. TARP started in September at USD 700 billion but more pouring out from 2009 onwards (and never forget the guarantee, freely given by the Treasury but in commercial terms costing huge, see below for a note on implied volatility and option premium). Read the reports over nearly ten years by the awkwardly-named Special Inspector General for TARP (Troubled Asset Relief Program). The figures ran into the trillions. In 2015 the payout was nearly USD 5 trillions and the total commitment was nearly USD 17 trillion. An ocean of cash, of debt, for future US citizens. And the Fed too, always active in the mix, cutting rates like there’s no tomorrow, throwing cash around, promised to keep things easy, easy, easy.
The rest of the world earnestly followed the same footsteps to rescue own banks and own supposedly troubled economy: Britain, Germany, France, Japan, every one, even China and Australia where growth was hardly interrupted. Trillions and trillions USD, a trillion being a million million. Don’t forget this was 2008 & 2009, cash was tight, the prices of stocks, houses, corporate notes and debentures (corporate “bonds” as salesmen would try to fool you), shenanigan securities, even gold silver and platinum, were simultaneously all at their low multi years.
Thus the world was saved from the abyss by governments borrowing money from the future and throwing it to all and sundries, chaps running the US and countless similar chappies around the world, energetically squandering money whether really necessarily or otherwise (as in the case of Australia). These chaps never truly realised that they were dealing with the market, the economy, a beast that has long long twist-and-turn memory, never a mathematical theorem with a well-contained proof punctuated at the end by a QED. There are always causes and effects in the market. Things you do and believe it right today may turn out to be truculently stupid later on, the righteous becoming the monstrous in ten twenty years’ time.
Forsaking the just future gains
So what really is the problem with what Bush, followed by Obama, had done those crazy months? It is this: Bush Obama and co. took huge risk to save greedy banks that committed crimes, thuggish insurance companies, inefficient firms that struggled with losses year upon year, saved them in the name of jobs and country, but never strived to earn a proper potential reward for trillions of dollars risked.
The bailouts were made out in straight loans carrying little interest, or in preference shares carrying a slightly better dividend at around 8%. Paulson and Bernanke thought that would fool the voters. Wrong. From September 2008 the S&P 500 index’s option implied volatility reached 50%, 60%, higher for individual financial stocks, and hung around there for a while, almost six months. In Japan it got to 100%, courtesy of this nation’s heroic decision of not to ban the shorting of financial stocks throughout September and October, while the rest of the world actively enforced the ban. And this was Japan, the place that since 1990 had performed stockmarket interference as a part-time occupation – speaking about misguided and juvenile romanticism! In the end the hero’s dam broke and Japan joined the banning game as from 4 November 2008.
A side note here. Preference shares in times of high risk are essentially equity in a risk sense (usually without power or future reward). Now you can short an at-the-money put option, on a stock, with a year to expiry for an annual premium of 8% of the stock price at an implied volatility (“vol”) of only 20% per annum. In risk and dollar terms these short put options are almost similar to 8% pref shares. If implied volatility is 50%, you get an annual premium of 20% of the price. Most large US banks stocks then suffered 100% implied vol with non-existent prospect for earnings and thus dividends (an annual 100% volatility means the stock could fluctuate 6% per working day on average, which these banks surely did at the time, and more), higher vol for smaller banks. So the preference shares should have carried at least 20% dividend rate, at least in the first year, and with strings attached on the management. Note that when you sell such options you immediately get the premium; the bailout pref shares had no such promise, so their dividend rate should even be higher to compensate, or more governance power given to the holder. Now you might argue that the 50% vol (conservative for bank shares then) would drop in future. Well this would be true but at that October moment you could get two years’ or three years’ worth of a similar premium with only a moderate lowering in implied volatility, such was the panic and the need for protection at the time. You might argue again that the bailout was so large, one could not apply the usual option mechanic. Well, large the bailout certainly was, but so were the financial sector and the panic it created, and that would mean I (that is, the hypothetical clever caring-for-the-nation president/ treasury head) would want an even higher dividend for the pref shares, and more power in management say, more right, or my opposite is welcome to bankruptcy. Guess what, you on behalf of your bank board would simply have to agree with me.
Alas, for Bush and Obama it was huge risk but no commensurate reward. As it turned out, those bailed-out institutions well recovered, and sitting at the top of the tree were the same silver spoon-fed boys (mostly) and girls. These were as arrogant as always (recall that the heads of GM, Ford and Chrysler came to Washington in 2008 for the bailout in their private jets while their companies went bellied up). They got rich again very quickly, paid themselves huge amount of cash and stocks from tax payers’ money, flaunting wealth. And Bernanke continued to buy treasury bonds like crazy at inflated value from the bank boys, moved rates to zero, threw trillions of dollars in cash to the banking system. In the process the whole system created the highest level of inequality in US history, and that odious outcome flowing on to the rest of the world, coinciding with the rising wealth of China from trade surplus. The poor get much poorer relative to the rich, courtesy of corruption and government and central bank largesse, many poor staying poor ten years on. Trickle-down economics has become a dirty word, to put it gently. Resentment sets in.
No wonder many poor voted for Trump, who was rich, silver spoon-fed, nasty in words and actions to women, to immigrants, void of knowledge of the world, but who had somehow found ways to sweet-talk the US poor.
The road not taken
Now naturally you would ask: OK, so how could the US have done better, getting a just reward for the bailout?
This is how if you were the president: you swap bailout money for equity stakes (or quasi-equity, participating preference shares starting at high dividend rates, or combinations thereof; but equity would be best). You let the management do the day-to-day running, but you decide on the right people from time to time, down the road. You set out your agenda and instruct them on broad management issues, because these guys now are practically public servants. You split the loss on subprimes between the banks and individual mortgagees, because you have already bankrolled the whole loss in the first place! The banks would have made less profit later on - thus less dividends to you! – but the poor will recover quicker for the most part. The mortgage repossessions, if needed, are to be carried out in a smaller scale and in a more decent manner (unlike the odious way in real life). The economy recovers in a real sense, not just the undeserving rich.
(The poor thus might not have voted for a Donald Trump if he happened to be a Republican candidate at all in 2016.)
New shares, many many shares, would thus be issued to you at prevailing market prices (and if you want to be generous, well, 10%-20% higher, but I wouldn’t be too generous). The US Treasury would be majority shareholders of many of these guys: AIG, Bank of American, CitiBank, and many more (Ford and Chrysler and GM too). They were bankrupt one way or another, they would have to accept whatever coming their way – the boys at the top would have no other job to go to except mowing the lawn of other people’s homes in their suburb. All other employees would go along, there being a more certain future. So would the populace. So would the Congressmen and senators (as especially in 2009 and most of 2010 when Obama controlled both Houses). So would everyone in the world, though this was beside the point.
And when those noxious huge firms recovered, positive cash-flow again, profits again, courtesy of Bernanke’s ZIRP, well, you float the shares onto the market. The Treasury would get a nice amount of cash and goodwill. More money to spend, hopefully for good causes, and a tiny bit less national debt (because the damage had been done in the first place with the crisis). Interest rate could then stay relatively low without the gross manipulation by the inexperienced Bernanke and similar chappies. You thus would, quite fairly, get accolades from constituents and from around the world. Now you can do real good things in geopolitics. Didn’t I say that already? You get the money in a proper way, you get the politics done in a proper way.
Outrageous? Wrong, it is practical, pure and simple, the right medicine for an outrageous occurrence. Read the above paragraphs again and tell me which part is not practical, which part is not about the real money in the real world? That’s the way the market is run. If you take risk you get the potential reward – if it works out, of course. You would quiz me: surely not at the national politics level. Ah, I would urge you to carefully study Sweden in 1992. Thanks to its government’s helping hand the country recovered from a banking crisis nearly as bad. The government took equity stake in the banks. The banks recovered, the government got richer from floating the stake, and do more things with the cash for the populace. Sweden was admired for some years afterwards.
That’s how it is done in the market - the open, proper, intelligent way, not the nauseous insider dirty game. Are you now complaining to me about the extra work for the Treasury, more staffs needed, and surely it’s not the Treasury’s job to run private concerns? Heavens, haven’t you been reading? This is the existential moment in time, the Treasury and central banking staffs had anyway already been running around like headless chickens without clue of the real world, wasting their salaries courtesy of taxpayers’ money. Extra work, extra responsibilities, because the President is saving the world, what seems to be the problem? Less ping-pong at lunchtime, anyone?
I know, you’re not Bush or Obama. Bush and the two Houses had to listen to Paulson and a whole host of advisors who were, at best, very inexperienced in solving market crisis for the nation, at worst, selfish and full of ulterior motives. Who simply would not read and ponder the lessons of history, recent history. And Obama who fared no better, who had to do likewise with Geithner and the same Bernanke. Obama who did not think deeply enough on the real market structure of the crisis, who did not take proper advantage of both Houses then in the Democrats’ hand. All it needed was courage.
Better next time
Once there was this clean straight road that was not taken, and now it’s ten years down the line. I suppose one could feel forlorn on things. Ah well I’m not a Yank. But here's hoping for a right course of action after the next crisis. By the way, this red in my hand isn’t a bad one, so cheers to the memory ...
Long Vo-Phuoc, 14 September 2018
"Argentina’s women will not be defeated"
Last week, early August 2018, was a wild one for the infighting within the Australian government, among a bunch of nasty self-centred boy and girl politicians, almost all untalented yet uniformly hugely egotistical.
Across the globe there had been another political fight over a more serious issue. Below is a reprint of an article from the Guardian Weekly 17 August 2018 by Claudia Piñeiro. Note the ninth paragraph (“Now we can talk publicly about ....”): this is a scenario replicated all over the world in poor and/or oppressed places for thousands of years to this day; and these are the women who are mothers, wives, daughters, granddaughters, lovers, friends ...
(I am a print subscriber, trust the newspaper doesn’t mind. After a few days I’ll leave only the web link (https://www.theguardian.com/commentisfree/2018/aug/10/argentina-women-abortion-hollow-senate-victory
... 30 Aug: keep only a few paragraphs here).
Argentina’s women have not been beaten on abortion – change will come
Claudia Piñeiro
The ‘senadores percha’ who voted against legalisation have won a hollow victory but cannot stand in the way of progress
Argentina’s senators could not understand what was being debated: legal abortion or clandestine abortion? Or they did not want to understand? Thirty-eight senators voted for the absolute rejection of a bill to allow legal termination, without showing any willingness to introduce changes or improve the proposals. They simply said “no” – as if they were judges instead of legislators.
They showed an arrogant attitude, absolutely detached from a reality in Argentina where there are women who die every year from complications arising after clandestine abortions.
To reject the bill, they pronounced all kind of barbarities from their seats: proclaiming that they were saving embryos, without explaining how, and even suggesting that intrafamily rape does not imply violence. A senator confessed that she would reject the bill although she had not had the opportunity to read it.
.......
Now we can talk publicly about the fact that in my country, in this new century, there are women who resort to using branches of parsley, knitting needles or hangers to carry out abortions. Some inventive member of the public has called these senators who voted to restrict women’s rights senadores percha (hanger senators) – with a hashtag that trended on Twitter.
This should not be a debate about religious beliefs, or about the private decisions everyone must take for themselves – but about public health. The senators did not understand – or they understood but did not care – because they privileged above everything else their faith, what a priest ordered them to do, or the supposed votes they hope to reap in next year’s elections.
........
Claudia Piñeiro is an Argentinian novelist and screenwriter.
August 2018
Congratulations to Shemara Wikramanayake, new head of Australia’s Macquarie Bank.
German football fans ...
Brandenburg Gate, 27 June, a forlorn angel ...
(Germany v Sth Korea on giant outdoor screen. The Dutch and the Italians had taken leave without pay, and now the German squad were politely told to pack up and enjoy the humble pie at home. Incredible. Photo: The Guardian - John Macdougall/AFP/Getty.)
Fever, fever. Football World Cup, in another place, really ....
The following is a true report, not a satire, not a fake news construct from a false account with sneaky Facebook or Google on behalf of faceless political meddlers (heard of the 2016 US election, fraudulent social media accounts and Russian collusion all of which under on-going investigation in the US?).
By football, I mean the real thing, that is, a round leather inexpensive objet d'art (fans believe so) kicked and dribbled by foot (also frequently popped up by a hard head or grabbed by a specifically designated pair of hands – though occasionally this grabbing act is “illegal”, a la Maradona (an outrageous punch in fact) and his interesting on-field religious belief); not a sport whereby an oblong shape is almost always grabbed (again!) and thrown around by hands belonging to all and sundry, said sport having the temerity, albeit woolly-headed, to call itself football.
Nah, really this is true football, true World Cup in both name and spirit. So here, I pass the pen (pardon, the keyboard - does anyone write by pen on paper, pulp or fancy cotton, any more?) to the nice chappies from the Guardian:
The World Football Cup began in London this week with a match at the Queen Elizabeth Stadium. This statement is true but may need clarification: it might sound like a report from a parallel universe in which the Fifa nobs sent their 2018 tournament to England not Russia.
The World Football Cup is not quite the actual World Cup. It is not even a consolation event for the countries temporarily locked out of the World Cup, those obscure places such as Italy, the Netherlands and the United States, who failed to qualify. It is more of a consolation prize in life.
It is for those places locked out of Fifa and, in almost every case, the international community as a whole: the world’s outcasts, the dispossessed, the not-quite nations, the once-were nations and in many cases never-will-be nations. Some are not geographical entities at all, such as Japan’s Korean minority. Some are intermittently, and almost always unhappily, in the news: like the Romany people and the Rohingya of Myanmar (neither of whom qualified). There is also an undercurrent of humour and satire. Among the 47 members of the Confederation of International Football Associations (Conifa) are Yorkshire, admitted too late for this tournament, and Cascadia, a greenish, libertarian, un-Trumpian confection with a slight whiff of dope, covering British Columbia and the north-western states of the US.
But the overwhelming theme is tragedy. The opening match at the Queen Elizabeth Stadium was between the reigning champions, Abkhazia (a breakaway from former Soviet Georgia), and Tibet. Hardly any of the Tibetan players or supporters have even been there. Their parents and grandparents were forced into exile after China invaded their country in 1951. “These players live all over the world,” says Tenzin Kunga from the unofficial Tibetan embassy in London. “But they are all Tibetans. I have never been there myself. But I dream of Tibet, always.”
The stadium was not quite as grand as the royal name suggests. This was the home ground of non-league Enfield Town, less pretentiously known as Donkey Lane. About 300 people turned up to watch, first, Tibet bravely restrict Abkhazia to three goals and then Northern Cyprus, the Cypriot Turks, take on Karpatalya in a skilful and combative match that ended in a sending-off, a punch-up and a 1-1 draw.
...........
(Read more on The Guardian Weekly, 8 June, 2018, pp. 46-47 or online – search for “CONIFA The Guardian”. Photo is from the article, showing supporters of the Tibetan team.)
It's about time (for heaven's sake) ... and young Varadkar'd better get on with it
News headline: Exit poll suggest Ireland has voted to relax abortion laws. The Irish Times/Ipsos MRBI late on Friday (Irish time, of course!) suggested a 68% to 32% in favour of the yes vote.
A voter, a woman teacher, said on the day: "Women have been treated so badly in this country by the Catholic church." (the Guardian, 25 May 2018).
Cheers (and the young Taoiseach over there better gets on with it: the bureaucratic nonsense of a six months' time frame, as he excitedly promised, is no good. Two weeks are more in tune with the present Irish state of mind. Put it this way, if, say, the Swiss threaten to invade Ireland (with battleships and coastal frigates borrowed from the French and the Germans - good heavens!), would he hurry up to pass a mobilisation resolution from his parliament? Lives are at stake here.).
"A Brief History Of Mark Zuckerberg ...
Apologizing (Or Not Apologizing) For Stuff"
Totally cocky, totally callous. Before “apologising” a day ago for the recent privacy disaster committed by his turning over 50 million Facebook users’ profile to Trump-affiliated political research group Cambridge Analytica for cooking stewing and general gross violation, young Zuckerberg had apologised many times. Read the following compilation by Harry McCracken of http://www.fastcompany.com in San Francisco (see “About the Author” at bottom):
" ... it’s worth revisiting some past Facebook controversies and how he responded to them. Let’s start at the beginning. Wait, let’s start even a little before that . . .
November 2003: “This Is Not How I Meant For Things To Go”
Three months before Zuckerberg launches http://TheFacebook.com from his Harvard dorm, he creates Facemash, a Hot or Not-esque site that (briefly) lets his fellow students rate each other’s looks, using photos Zuckerberg has downloaded in bulk from several on-campus sources. A half hour after it becomes a phenomenon–and subject of outrage–he shuts it down. “I don’t see how it can go back online,” Zuckerberg tells the Harvard Crimson. “Issues about violating people’s privacy don’t seem to be surmountable. The primary concern is hurting people’s feelings. I’m not willing to risk insulting anyone.” In a letter to irate classmates, Zuckerberg gives his first apology to make the news: “I hope you understand, this is not how I meant for things to go, and I apologize for any harm done as a result of my neglect to consider how quickly the site would spread and its consequences thereafter . . . I definitely see how my intentions could be seen in the wrong light.” Zuckerberg is called before Harvard’s administrative board for violations of both privacy and copyright, but survives–and gets to work on a social network for his fellow Harvardians.
September 2006: “Calm Down. Breathe. We Hear You”
Shortly before it ends its student-only restriction and opens up to everyone over the age of 13, Facebook starts aggregating activity from each member’s friends into a new feature called the News Feed. Though it soon becomes the primary way to consume Facebook, some users find it creepy or simply overwhelming. In a blog post titled “Calm down. Breathe. We hear you,” Zuckerberg informs the unhappy campers that they’re worked up over a work in progress that doesn’t make the service less private. After a few days’ reflection, however, he concedes that “we really messed this one up.” He goes on to insist that Facebook has always been about giving people control over their own information: “Somehow we missed this point with News Feed and Mini-Feed and we didn’t build in the proper privacy controls right away. This was a big mistake on our part, and I’m sorry for it.”
December 2007: “People Need To Be Able To Explicitly Choose What They Share”
As Facebook begins to develop a strategy to monetize its 50 million users, it introduces Beacon, a technology that automatically tells your friends about your activities at third-party sites such as Epicurious, Fandango, Overstock, and Travelocity. It does so without getting permission or allowing permanent opt-out, prompting anger and confusion akin to the 2006 News Feed dustup. “We’ve made a lot of mistakes building this feature, but we’ve made even more with how we’ve handled them,” Zuckerberg admits in a blog post explaining post-launch tweaks to Beacon. “We simply did a bad job with this release, and I apologize for it.” The feature is the subject of class-action suits and disappears altogether after less than two years.
May 2010: “We Will Keep Building, We Will Keep Listening”
Facebook privacy violations are again in the news as the Wall Street Journal‘s Emily Steel and Jessica Vascellaro report that the company (and other social networks such as MySpace) divulge unique user IDs to advertisers, which can be used to track consumers. As part of Facebook’s cleanup effort, Zuckerberg publishes a Washington Post op-ed allowing that the company’s privacy options “just missed the mark” but also underlining that the company’s goal is to make the world more open. “Facebook has evolved from a simple dorm-room project to a global social network connecting millions of people,” he writes. “We will keep building, we will keep listening, and we will continue to have a dialogue with everyone who cares enough about Facebook to share their ideas.”
September 2010: “I Think I’ve Grown And Learned A Lot”
Months after Silicon Valley Insider publishes old instant messages in which Zuckerberg makes incendiary remarks such as calling the earliest Facebook members “dumb fucks” for trusting him with their information, he issues a mea-sorta-culpa during an interview with the New Yorker’s Jose Antonio Vargas. Zuckerberg says that he “absolutely” regrets the six-year-old exchanges but shouldn’t be judged by them: “If you’re going to go on to build a service that is influential and that a lot of people rely on, then you need to be mature, right? I think I’ve grown and learned a lot.”
For about six years, Facebook does a surprisingly adept job of sidestepping major controversies, giving Zuckerberg less reason to tell anyone he’s sorry about anything. And then . . .
November 2016: “The Idea That Fake News On Facebook . . . Influenced The Election In Any Way Is A Pretty Crazy Idea”
At a conference days after the U.S. presidential election, Zuckerberg dismisses concerns about Facebook’s role in its outcome: “Personally, I think the idea that fake news on Facebook, of which it’s a very small amount of the content, influenced the election in any way is a pretty crazy idea.” He adds that the theory that voters were swayed by hoaxes assumes that Trump voters were unsophisticated consumers of information, which he doesn’t buy. “People are smart and they understand what’s important to them,” he argues.
February 2017: “I Often Agree With Those Criticizing Us”
Three months after the election, Zuckerberg publishes a 5,000-word manifesto that never mentions Donald Trump by name but does allow that Facebook has been overwhelmed by the task of policing its content on a variety of fronts. “We’ve seen this in misclassifying hate speech in political debates in both directions–taking down accounts and content that should be left up and leaving up content that was hateful and should be taken down,” he writes. “Both the number of issues and their cultural importance has increased recently.” Zuckerberg adds: “This has been painful for me because I often agree with those criticizing us that we’re making mistakes,” prompting CNBC’s Christine Clifford to declare that his willingness to expose his vulnerability makes him a strong leader.
September 2017: “This Is Too Important An Issue To Be Dismissive”
After President Trump says that Facebook has always been out to get him, Zuckerberg says that the fact that both the president and his critics are mad at Facebook shows that the service is a forum for free expression. He points out ways in which Facebook’s impact on the 2016 campaign was positive–such as its get-out-the-vote effort–and says that the media has mischaracterized the company’s role. Along the way, though, he backpedals on his initial comments about the possibility that misinformation on Facebook influenced the election results: “Calling that crazy was dismissive and I regret it. This is too important an issue to be dismissive.”
Also In September 2017: “I Ask For Forgiveness And I Will Work To Do Better”
On the last day of Yom Kippur, Zuckerberg atones for his own failings in a Facebook post but also mentions unspecified instances of others abusing Facebook for divisive means: “For those I hurt this year, I ask forgiveness and I will try to be better. For the ways my work was used to divide people rather than bring us together, I ask for forgiveness and I will work to do better.”
Mark Zuckerberg Facebook Spaces Puerto Rico
October 2017: “I’m Sorry To Anyone This Offended”
After Puerto Rico is devastated by Hurricane Maria, Zuckberg broadcasts a video using Facebook’s Spaces VR app in which cartoon versions of himself and a colleague teleport to witness the damage. After some commenters criticize the effort as insensitive or opportunistic, he chimes in via a comment of his own to say that his goal had been to show VR’s potential for increasing human empathy. “Reading some of the comments, I realize this wasn’t clear, and I’m sorry to anyone this offended,” he writes.
January 2018: “Facebook Has A Lot Of Work To Do”
Each January, Zuckerberg announces a goal for the year ahead, typically involving a personal goal such as eating only meat from animals he personally kills or reading a new book every other week. For 2018, however, his objective is all about pressing problems at his day job. “The world feels anxious and divided, and Facebook has a lot of work to do–whether it’s protecting our community from abuse and hate, defending against the interference by nation states, or making sure that time spent on Facebook is well spent,” he posts on his wall. “My personal challenge for 2018 is to focus on fixing these important issues. We won’t prevent all mistakes or abuse, but we currently make too many errors enforcing our policies and preventing misuse of our tools. If we’re successful this year then we’ll end 2018 on a much better trajectory.”
Looking over Zuckerberg’s past reactions to Facebook catastrophes, kerfuffles, and minor embarassments shows that he’s gotten better at sounding humble and avoiding the temptation to tell people that the fact they don’t like something is a sign they don’t understand it. It also suggests that when easy fixes will allay concerns, he’s pretty good at making them. But the Cambridge Analytica crisis strikes at the heart of Facebook’s data-mining business model and involves factors not entirely under his control, limiting the value of his past experience at damage control. And with the company’s stock tanking, legislators demanding answers, and class-action hell on the horizon, the stakes have never been higher."
About the author
Harry McCracken is the technology editor for Fast Company, based in San Francisco. In past lives, he was editor at large for Time magazine, founder and editor of Technologizer, and editor of PC World.
Fifty years
Long Vo-Phuoc
The Atlantic online on 10 January published a photo essay by Alan Taylor on 1968, the year that engraved deep in many people’s mind. I select here the four images personally most appealing (all 50 are outstanding). The short title for each is mine, followed by Taylor’s caption.
I add two more, from GoogleImages, #2 and #5 below.
1. I once knew this place.
The flag of South Vietnam flies atop a tower of the main fortified structure in the old citadel as a jeep crosses a bridge over a moat in Hue during the Tet Offensive in February of 1968. AT.
2. Where have all the flowers gone? A mass grave discovered soon after the Tet massacre committed by communists troops in Huế, February 1968. (Photo: Life magazine).
3. Mỹ Lai ... Mỹ Lai ... lest we forget.
Evidence of the My Lai Massacre. A photograph of Vietnamese women and children in My Lai before they were killed by U.S. soldiers in the massacre on March 16, 1968. According to court testimony, they were killed seconds after the photo was taken. The woman on the right is adjusting her blouse buttons because of a sexual assault that happened before the massacre. Image taken from Volume III, Book 6, of the Report of the Department of the Army Review of the Preliminary Investigations into the My Lai Incident, photographed by United States Army photographer Ronald L. Haeberle. AT.
4. Tanks against civilians in Memphis.
U.S. National Guard troops block off Beale Street in Memphis, Tennessee, as Civil Rights marchers wearing placards reading, "I AM A MAN" pass by on March 29, 1968. It was the third consecutive march held by the group in as many days. AT.
5. Voices of the Sixties, Paris, May 1968. (Photo: Giles Canon)
6. Tanks against civilians in Prague.
By late summer, talks between the Soviets and Czech leaders were not going the way the Kremlin wanted, so more than 2,000 tanks and thousands more Warsaw Pact troops invaded and occupied the country in August. This column of Soviet tanks was lined up in a street in Prague, Czechoslovakia, near the Old Town Square, on August 28, 1968, after Czech leaders had returned from negotiations with the Russians. AT.
,,,,,,,,
January 30 1968 was New Year Day of Mậu Thân, the Monkey Year, the day Việt communist forces attacked some forty main towns of South Việt Nam including the capital. I lived in one of them. The afternoon that day, when things had quietened down, I walked through the city doing a family errand, at one time looking up at the fourth the fifth floor of an unusually high building. I was in very early teen, but some of the communist troops were as young as 12, 13; a few, when surrendering, captured or found dead, were discovered chained to their machine guns.
But the place wasn’t Huế, the ancient city that bore the deepest war scar.
Were I still smoking I would see those fifty years hang in the air like an abyss of grey nothing. Flick of the wrist, and the years would scatter as if wispy mayflies, surely ...
Long Vo-Phuoc, 30 January 2018
A Trip Down Bubble Lanes
An infamous milestone was reached today, see chart. I never like young and old chaps eagerly babbling and chasing bubbles, but here is one sober fact: even at this ridiculous junction, the total value of all bitcoins (USD 17,200 each, right now) is still half that of Facebook. And the total value of all crypto "currencies" is still, slightly, less than the latter’s.
(Facebook? What’s that? Ah yes, it’s worth half a trillion USD, or some 1,200 times an ordinary painting supposedly by Leonardo da Vinci, the Salvator Mundi – sold recently for USD 450 million including auctioneer’s commission.)
I‘d better have my late breakfast before thinking about the like of Greenspan, Bernanke, Yellen, Draghi, Kuroda ...
Long Vo-Phuoc, 13 December 2017.
Do Bats Have Faangs?
Long Vo-Phuoc
This chart has recently been doing the rounds on Bloomberg, thus I’m a little repetitive here. Yet the implication for the financial times we’re living in is so outrageous that it’s worthwhile to highlight one particular angle, below. But first, for the good souls who are not stock speculators or so-called market analysts, FAANGs refer to 5 US "tech" companies: Facebook, Apple, Amazon, Netflix and Google. To be frank, Amazon and Netflix are not tech at all, just online stores and entertainment, Facebook is social media, hardly tech, and Apple is simply modern consumer-durable (really it's practically non-durable, seeing that new upgrades pour out so often in the name of profits).
BATs are 3 Chinese equivalents, operating mostly in China : Baidu (search engine), Alibaba (a la Amazon) and Tencent (a la Facebook). Phew, my jaw ... my few typing fingers ... are sore.
The point is this: the rise in value, in 2017 alone, of these eight companies is worth more than the GDP of Canada, veteran member of the G7 with huge resources.
More relevantly: the same rise of USD 1.7 trillion (that is, again, only in 2017 to date), all twelve zeros (pardon, eleven zeros following 1,7), is worth more than the whole value, the whole total worth, of all 30 largest German companies at current market prices. This is a crazy fact, because Germany has the biggest trade surplus in the world. German firms produce things that the US, China and the rest of the world desire – books (Landolt–Börnstein series, anyone?), quality services from health to insurance, road-hugging BMWs, fashionable Escadas, reliable Siemens accessories, the best pharmaceuticals and other chemicals, the best industrial equipment and machinery, the finest precision scientific instruments (how can one forget the Faber-Castell slide-rules of early 1970s?), and whatever else. They produce things that hurt if dropped on your feet, as an old-time market speculator would say, and more. And we aren't talking about garden shovels, greasy oil barrels or iron ore lumps.
(The place is also a liberal democracy that has full freedom of the press. It has moved on a fair way since the Nazi days.)
The only stuffs important that German companies don’t produce so much are ships, aircrafts and cutting-edge military matériel, but Faangs and Bats know zilch about such. Hell, Faangs and Bats, apart perhaps from Apple and Google, hardly produce anything at all.
The real cause for so many sharp faangs bats have nowadays? Don’t you know, it’s the continuing largesse from dumb and inexperienced central-banking public servants: Bernanke, Yellen, Draghi, Kuroda and acolytes and apprentices in Britain, China, South Korea, Canada, Australia, Switzerland and sundry others. The whole world in fact, sadly. And when the shit hits the fan, they’ll all cry wolf and blame everything except themselves. All over again, with shorter frequency and louder mouths and self-serving “memoirs” (good heavens, as if these boys and girls can really write).
Long Vo-Phuoc, November 2017.
Monday ... Tuesday
I couldn't resist making a mention today of the "1987 Black Monday Crash", the one when the All-Ords fell 25% in one day, never happened before or since. Right now it's 7, Friday morning. Yesterday was obviously Thursday, so it's not as atmospheric (understatement, sure) as Monday October 19 in New York thirty years ago , or Tuesday the 20th downunder.
These two photos from the Fin Review bring back memory. The four chaps, a fair bit younger than I, were broking houses' dealers or chit runners on the floor. They now have all grown older and, I trust, happy and prosperous. The floor is no more.
Where was I then? Ah yes, in my office in a fund management house, newspapers and brokers' reports strewn all over the desk, watching the prices intensely, watching implied volatility reach the sky. In the dealing room there were ashen faces ....
Cheers to the memory.
Long Vo-Phuoc, October 2017
Larry Page's email, helpfully written by The Economist
Couple of weeks ago I referred to two obituary articles from the Economist, and didn't want to quote the newspaper again in any hurry. Nevertheless its "Page/Damore" article in current edition, 19 August 2017, pp. 46-48, is quite an amusing way to address a serious issue, so here are two photos of the pages - the print article being more eye-catching than its digital sister. You, dear reader, might like to check out the disclaimer right at the end. Three cheers for the staffer at the newspaper, Page (Brinny too) sure can learn plenty from her/him.
Long Vo-Phuoc
(PS. Any copyright concern from the newspaper simply send me a G+ note and I'd be happy to replace the images with the link.)
A dollar or two profit, anyone?
Long Vo-Phuoc
Back in 1999 and early 2000 the sneaky brokers and wide-eyed fervent speculators promoted an all-important investment concept: the price-revenue ratio. “This time is different”, they emphasised.
The number was meant to do away with the boring, and often inadequate, price-earnings ratio. “What kind of an investment metric is that”, they threw the fiery argument at the unbelievers’ face, “that it (the PE thing) no longer exists?”. Are we getting on with the new paradigm and greet, they continued, the new millennium in chairman Al’s spirit, or not? Hasn’t the chairman said everything would be real fine? Hasn’t he said he would be ever ready to throw more bucks into the party, this great party that he wondrously named “Y2K"?
Ah, you see, the PE ratio is not defined as having a negative value. So when there is a loss (pardon, when there is no profit), how could one justify baby techies' sky-reaching share price? Well, the future is what it counts, be it 5, 10 or 100 years. And the future, the far far-off future, is lovingly embedded in the price-revenue ratio. The PR ratio, for the sake of the heavens.
(For old-fashioned boys, an established company’s share price starts to look expensive when the PE (not PR!), using next year’s projected earnings, approaches 20. If “next year” is a term often well stewed in the pot by the creative accountants then averaging out for the past 10 years would be more desirable, as mate Shiller would reason. Shiller’s smoothing number, the Cyclically-Adjusted PE, is generally a little higher than the optimistic “next year” equivalent, other things being equal. (Optimistic, because broking houses' "analysts" in bubbling times tend to inflate next year's projected profit using fantasy assumptions, thus artificially lowering the PE. Look at how different, to put it very mildly, actual earnings in 2000 for techies were to the expected; likewise for financials in 2009; likewise for Japanese enterprises in 1990. Many firms' large expected profits turned out to be huge real losses, and the relevant PE for each thus suddenly disappeared into the abyss.)
As it turned out, said “next year” figure for the S&P 500 as 2000 arrived, flushed with Al Greenspan’s cash, was rapidly climbing because the share prices ran away like bullet trains; and the Schiller one firmly sat on 44. 44? Outrageous. Well, in my mind, as clear as a dry cloudless Tokyo winter morning with powdery snow in the air, the equivalent for the Nikkei-225 was a young champagne-bubbling 90 as 1990 arrived on the quaint streets of that capital. What’s between friends, 44 or 90? And Shiller didn’t even do the ratio for the Nasdaq in 1999/early 2000, or the ratio would have reached the moon.)
Anyway, back to the revenue story. Eighteen years ago when the PE didn’t exist in any foreseeable future for many companies that were worth billions (yes, even then) the boys pushed hard for the PR thing. Alas, even revenue for these things was still as rare as leaves on the trees late autumn (I’m borrowing a line from an old Viet war-end manifesto, Bình Ngô Đại-Cáo by Nguyễn Trãi, early 15th century). Thus we're talking about a PR of 20, 30, 100, more.
Now now, you would say. If CAPE of 20 is expensive, a CAPE of 44 or 90 is once in a lifetime, then how could a revenue one be 20, 30, 100? Was this to justify the billions USD shovelled into the capitalist factory line, you would ask?
Ah, all true my mate. All true. There were fund management boys, dumb cocky and greedy in the same breath, who rode the trend hard and eventually caused untold hardship to their investors. (The typical excuse being that there was an obligation to the investment "mandate" - a tiresome and rather pretentious term - thus the manager had to buy shares when new money became available. But this is nonsense, as share funds at the time were of an active, discretionary, management nature. These were not the same as the many robotic exchange-traded funds, ETFs, that have been growing in recent years like mushrooms after wet weather.)
Thus the crashes came as part of history – financial history, Nikkei Nasdaq S&P500, et cetera.
At any rate, further to my post two months ago, Musing for Fun on Global Top 50 Revenue, here is a new related graph. Looks nice, presents well the four different factors (revenue, profit, name, industry), the figures appear in line with published data, available also from Forbes, compiled by Ishtyaq Habib (ishtyaqhabib.com, showing nice interactive data), featured on visualcapitalist.com.
The amounts shown are for the last 12 months. The oil and mining chappies suffered in recent profit because of badly eroding margin from weak commodity prices, but they did make plenty not so long ago - the CAPE concept being relevant here. Established techies (in particular Apple and Microsoft) did well but many online pricey darlings (Amazon and such) still struggled to properly spell the word profit, a thing rare for them as stars in the early morning sky (still borrowing lines from the same old Viet doc above). Chinese banks made big bucks, indeed, but you might as well ask what about the real deleveraging process that must eventually come to their land, and what ghosts hidden in their balance sheet? And what car was Warren Buffett driving, an old (trusty?) Yankee Oldsmobile or a fancy imported one, as his Berkshire still raking in quite a few dollars?
Have fun.
(By the way, Shiller’s CAPE for the S&P500 is now 30, the median for the last 120 years is 16. Yes, global economics have structurally changed plenty the last 100 years. The question is, of course, have things changed so much that 30 has permanently become the new normal of 16, at a time of trough interest rate and peak profitability?)
Long Vo-Phuoc, June 2017
© All rights reserved.
Cartoon for a winter day
Side-splitting (let’s exaggerate a little) artistry from David Rowe of the Australian Financial Review today – a cloudless sky early in the morning, the loveliest shade of violet-blue anywhere in the world.
Musing for Fun: Global Top 50 by Revenue
Long Vo-Phuoc
Some straightforward notes:
The valuable companies, in the eyes of speculators and money-management boys, are not necessarily those that have the highest sales: Apple is one of the few exceptions (even though it only makes mobile phones and personal computers - and the odd ipods years back). Google/Alphabet is not in the ranking here. Pricey tech hangers-on such as Facebook, LinkedIn and the like, don’t rate at all.
More revenue is one thing, a baggage of state loyalties, huge machinery cost and environmental stress is another, with these gongs on the shoulder you’re far from being diamonds in the sky (in the eyes of speculators, etc.): compare the oil chappies to the techies.
Banks’ revenue is always tricky: what about non-performing loans and sundry liabilities that are hidden from the balance sheet, ghosts that would suddenly materialise whenever there is a simplest whiff of economic stress, the simplest whisper of a fair and responsible interest rate regime (which however doesn’t exist in today’s consumer paradise). Plenty of Chinese banks on the list here.
Retailers’ revenue is even trickier, the slender profit margin means they are hardly worth the cash in the till (or wherever it is stored in today’s cash-less world insisted upon by earnest juvenile politicians and cronies);
More revenue doesn’t mean you’re richer. Look at the real difference between Samsung and Apple, two long-standing playmates. PE expansion is these guys’ god. (Speaking of riches, your mate Google – I dislike the other, rather pretentious, name - is neck and neck with Apple as the two top treasures of this material world).
State firms such as State Grid and its cousins? It’s hard to distill profit from sales when you have two million employees. As to these “enterprises” in the rich world, one would be driven to despair simply to think of the wastage, over-paid public servants and their fat and undeserved defined-benefit pension funded by taxpayers' piles upon piles of dough, generations down the line.
The car chappies: the less spoken about them the better, dinosaurs who dress up as hi-tech super models, pushing for a buck whilst polluting the air (what about Tesla you might ask? Tesla? Hardly a few relative dollars in annual revenue (USD 7 billion or so), big ego, probably never a cent in annual profit for the next 1,000 years, but they reckon it’s worth all of USD 50 billion mind you!).
And Berkshire? Ah that’s the anomaly here. I like Buffett and his seemingly simple style. Maybe it’s high time he rests at home reading a few decent other books, books that show the world is about much more than money.
The main point here, though? Revenue big boys are supremely tiresome. Just as equally so if the header is changed to “valuation”, sadly. Check it out.
(Image courtesy of datashown.com, produced Jan 2017. The figures, annual amounts toward 2016's end for most, appear to tie in reasonably well with the companies’ public records, such as are in hand.)
Long Vo-Phuoc, 2017
© All rights reserved.
#GlobalTop50 #TopRevenueCorps
LA International Airport, 2017
Article below from the online Guardian, Feb 27, 2017:
In that moment I loathed America. I loathed the entire country.
Australian children’s book author Mem Fox says the experience of being detained and interrogated by US border security has turned her into a revolutionary.
I was pulled out of line in the immigration queue at LAX as I came in to the USA. Not because I was Mem Fox the writer – nobody knew that – I was just a normal person like anybody else. They thought I was working in the States and that I had come in on the wrong visa.
I was receiving an honorarium for delivering an opening keynote at a literacy conference, and because my expenses were being paid, they said “you need to answer further questions”. So I was taken into this holding room with about 20 other people and kept there for an hour and 40 minutes, and for 15 minutes I was interrogated.
The room was like a waiting room in a hospital but a bit more grim than that. There was a notice on the wall that was far too small, saying no cell phones allowed, and anybody who did use a cellphone, had someone stand in front of them and yell “don’t use that phone!” Everything was yelled, and everything was public, and this was the most awful thing, I heard things happening in that room happening to other people that made me ashamed to be human.
There was an Iranian woman in a wheelchair, she was about 80, wearing a little mauve cardigan, and they were yelling at her - “Arabic? Arabic?”. They screamed at her, “ARABIC?” at the top of their voices, and finally she intuited what they wanted and I heard her say “Farsi” and I thought heaven help her, she’s Iranian, what’s going to happen?
There was a woman from Taiwan, being yelled at about at about how she made her money, but she didn’t understand the question. The officer was yelling at her: “Where does your money come from, does it grow on trees? Does it fall from the sky?”. It was awful.
There was no toilet, no water, and there was this woman with a baby. If I had been holed up in that room with a pouch on my chest, and a baby crying, or needing to be fed, oh God ... the agony I was surrounded by in that room was like a razor blade across my heart.
When I was called to be interviewed I was rereading a novel from 40 years ago – thank God I had a novel – I was reading The Red and the Black by Stendhal, (a 19th century novel keeps you quiet on a long flight, great in a crisis!) and I was buried in it and didn’t hear my name called. And a woman in front of me said “they are calling for Fox”. I didn’t know which booth to go to, then suddenly there was a man in front of me, heaving with weaponry, standing with his legs apart yelling, “no, not there, here!” I apologised politely and said I’d been buried in my book and he said “what do you expect me to do, stand here while you finish it?” very loudly and with shocking insolence.
The way I was interviewed was monstrous. If only they had been able to look into my suitcase and see my books! The irony! I had a copy of my new book I’m Australian, Too – it’s about immigration and welcoming people to live in a happy country. I am all about inclusivity, humanity, and the oneness of the humans of the world; it’s the theme of my life! I also had a copy of Ten Little Fingers and Ten Little Toes. I told him I had all these inclusive books of mine in my bag, and he yelled at me “I can read!”
He was less than half my age - I don’t look 70 but I don’t look 60 either, I’m an older woman – and I was standing this whole time. The belligerence and violence of it was really terrifying. I had to hold the heel of my right hand to my heart to stop it beating so hard.
They were not apologetic at any point. When they discovered that Australia’s official gift to Prince George was Ten Little Fingers and Ten Little Toes, he held out his hand and said “It’s been a pleasure to meet you Ms Fox”. I was close to collapse, very close to fainting, and this nearly broke me – it was the creepiest thing of all.
I had been upright, dignified, cool, and polite, and this was so cruelly unexpected, so appalling, that he should say it was a pleasure. It couldn’t have been a pleasure for him to treat me like that, unless he was a psychopath.
In that moment I loathed America. I loathed the entire country. And it was my 117th visit to the country so I know that most people are very generous and warm hearted. They have been wonderful to me over the years. I got over that hatred within a day or two. But if that can happen to me? This is not the way to win friends, to do this to someone who is Australian when we have supported them in every damn war. It’s absolutely outrageous.
Later in the hotel room I was shaking like a leaf. I rang my friend, my American editor and bawled and bawled, and she told me to write it all down, and I wrote for two hours. I fell asleep thinking I would sleep for eight hours, but I woke up an hour and a half later just sobbing. I had been sobbing in my sleep. It was very traumatic.
After I got back to Australia I had an apology from the American Embassy, I was very impressed, they were very comforting, and I’ve had so many messages of support from Americans and American authors.
I am a human being, so I do understand that these people might not be well trained, but they now have carte blanche to be as horrible and belligerent as they want. I’m sorry for them, but I am not sorry for what they are doing to me and other people. They’ve gone mad – they’ve got all the power that they want but they don’t have the training.
They made me feel like such a crushed, mashed, hopeless old lady, and I am a feisty, strong, articulated English speaker! I kept thinking that if this were happening to me, a person who is white, articulate, educated, and fluent in English, what on earth is happening to people who don’t have my power?
That’s the heartbreak of it. Remember, I wasn’t pulled out out because I’m some kind of revolutionary activist, but my God, I am now. I am on the front line. If we don’t don’t stand up and shout, good sense and good will not prevail, and my voice will be one of the loudest.
That’s what it has taught me. I thought I was an activist before, but this has turned me into a revolutionary. I’m not letting it happen here. Instead of crying and being sad and sitting on couch, I am going to write to politicians. I am going to call. I am going to write to newspapers. I am going to get on the radio. I will not be quiet. No more passive behaviour. Hear me roar.
* As told to Lucy Clark
(Lucy Clark is a senior editor at Guardian Australia.)
Utterances and the Market's Idiocy & Juvenile Callousness
Long Vo-Phuoc
“No Congress of the United States ever assembled, on surveying the State of the Union, has met with a more pleasant prospect than that which appears at the present time.”
- Calvin Coolidge, December 4, 1928
“There can be little argument that the American economy as it stands at the beginning of a new century has never exhibited so remarkable a prosperity for at least the majority of Americans.”
- Alan Greenspan, January 30, 2000
“We believe the effect of the troubles in the subprime sector on the broader housing market will be limited and we do not expect significant spillovers from the subprime market to the rest of the economy or to the financial system.”
- Ben Bernanke, May 17, 2007
Events that unfolded almost immediately after the above grand utterances proved them wrong, damaging and unbelievably irresponsible - the 1930s world-wide depression, the ridiculous dotcom bubble's 2000 busting, the 2008 global financial crisis. Coolidge died in 1933 without seeing the full depth of economic despair that followed. Greenspan retired, published book, earned money from babbling at talk fests, and is still full of self-serving justification. Bernanke retired, published book, earned money from babbling at talk fests, and is still full of self-serving justification. I wonder if anyone has ever given these two chaps a mirror for their twisted vanity.
What about the current state of play, one might ask?
“Investors haven’t been this optimistic on the global economy since 2011... A full 23 percent of investors expect an outright ‘boom,’ according to a survey released Tuesday by Bank of America Merrill Lynch... ‘The U.S. economy is not only humming on all cylinders, but in our view the optimism associated with a clean sweep by the Republicans in Washington is likely to create a self-fulfilling period of strong markets and at least the potential for strong growth.’ The optimism comes amid forecasts global growth will pick up and as Donald Trump promises to cut taxes, boost fiscal spending and loosen regulations in moves that could boost corporate earnings. ‘Macro optimism is surging,’ wrote the team.”
Bank of America Merrill Lynch Global Fund Manager Survey, Feb 14, 2017
as reported on Bloomberg and CNBC, in the US, Feb 14, 2017
From an alternative spectrum of thoughts, however, US hedge fund manager John Hussman has this to say in his Weekly Market Comment of Feb 20, 2017:
“Market conditions aside, I am also dismayed by the increasingly mean-spirited, divisive, weakly-informed, and nearly pathological mode of governance that is unfolding before us. For now, Wall Street seems to love every bit of it. Then again, we should repeatedly have learned that once blinded by speculation, Wall Street has never had the capacity to recognize a massive toxic liability until it implodes and rains havoc on the entire country.”
Long Vo-Phuoc, 23 Feb
(Image from GoogleImages)
#WallStreetsFollies #TrumpShareRally #EasyAl #HelicopterBen
I have a complaint to make
Long Vo-Phuoc
You know, for years I kept losing the invitation in the mail. Every year, they kept apologising to me. They said, we put the thing in the classiest envelope, we sealed the back with our great elite logo wax, we put on our fine postage stamps, priority-paid, yet we don’t know why you didn’t get it for donkey years. They said, we are so concerned that we’ve never seen you here at this great gathering. They said, we know you think all this is just a dumb talk-fest for those who clamour for fame and silly networking, exercising jaws whilst spending huge amounts of mostly other people’s money supporting our little town. Yes, said they, we know the crappy hamburger here costs the equivalent of USD 40, a little room in a down-trodden hotel USD 1,000 a night, our staffs have to sleep in the car park to make room for the exalted guests (and you are right at the top of that list, they flattered me), all that is ridiculous, but we want you here, to see Bill, Jamie, Richie, sundry celebs, ah yes, Mario too, even if you’re never impressed with the guy, but they’re all very easy chappies over the decades, easy Al easy heli Ben easy Janet super easy Haru super easy Mario ...
Whatever ... the fact remains that I never received the invite, the plane ticket (first, of course), the suite reservation. Nothing.
And just now I missed Joe’s final speech. Don’t know the guy really, but lately he made a few sound bites. Yes, his speech was stirring enough (but never ever comparable to Barracky’s mind you), and well-timed. Believe it or not, I watched some of it from my computer. From the computer, heavens! I should have been right in the big room, so Joe could come over and shake my hand when he’s finished.
This year, especially. The Donald (you know, the former TV show host – what, you didn’t bother to watch them shows? Ah well, neither did I really) didn’t come, so one less annoying thing.
But where was the paperwork, I ask you????
I really have to make a complaint to Swiss Post about losing my invite. Unlike me of course, nice quiet guy usually. But I have to, as it’s about time, next year that is, to drop in the place before I’m too old to travel to Europe in deep winter again.
Ah, Davos and the silly loquacious World Whatsie Forum. Now, if only they didn’t lose my paperwork, year after year. What has this world come to!
As to the coming big bash in Washington, well this one, and this time, I know I wasn’t invited. You see, the former property developer and I, we've never got on.
Long Vo-Phuoc, Jan 2017
© All rights reserved.
(photo from Google Images)
#Davos #WEF #EasyAl #HelicopterBen
Jokes for the Season
December is here with us all, let’s do some smiling (and, dare I say it, forgiveness?). US reporter Jenna Johnson compiled 282 Donald Trump promises during his election campaign and put them on the Washington Post's website on Nov 28 . These ranged, for the most part, from rib-splitting comedies to the purest nonsense. The link is as below, showing comprehensive video and other references.
Have a few laughs before the usual sober reflections at year’s end.
https://www.washingtonpost.com/politics/i-will-give-you-everything-here-are-282-of-donald-trumps-campaign-promises/2016/11/24/01160678-b0f9-11e6-8616-52b15787add0_story.html?utm_term=.48bb78435cad
Aftermath ...
Article below was published on slate.com (blogs), Nov 9, by Michelle Goldberg, a US journalist.
I felt sad reading it. I can only hope that things won’t turn out to be so soul-destroying under Trump’s presidency, that Trump would, somehow, improve on his attitude and action towards women.
Photo of Hillary Clinton as per the article.
Long Vo-Phuoc, Nov 10.
Donald Trump’s Victory Proves That America Hates Women
By Michelle Goldberg
Forty-six years ago, Germaine Greer wrote in The Female Eunuch, “Women have very little idea of how much men hate them.” Well, now we do.
On Tuesday, faced with a choice between a highly competent if uncharismatic female candidate and the deranged distillation of the angry white male id, America chose the latter. (Or, at least, the Americans whose votes count most in the Electoral College chose the latter: Hillary Clinton won the popular vote.) We don’t yet have a full picture of the electorate, but according to exit polls published by the New York Times, 54 percent of women voted for Clinton while 53 percent of men chose Donald Trump. Men—joined by white women, a majority of whom voted for Trump—banded together to award the presidency to the most shamelessly misogynist candidate in modern history. They’ve given us a kakistrocracy because they couldn’t bear the sound of Clinton’s voice.
The fact that white women displayed so little gender solidarity is not that surprising; many women have always identified more with their race or religion than their sex. Near Trump Tower in Manhattan Tuesday afternoon, I saw a vendor selling buttons that read “Hot Chicks Vote Republican.” Women at Trump rallies donned shirts emblazoned with “Adorable Deplorable.” Given what our society values in women, it’s understandable that large numbers of women wouldn’t want to see themselves in someone reviled as shrill and unfuckable. Writing in the Atlantic earlier this year, Peter Beinart surveyed some of the academic literature on the anxieties that powerful women provoke in both genders. “A 2010 study by Victoria L. Brescoll and Tyler G. Okimoto found that people’s views of a fictional male state senator did not change when they were told he was ambitious,” he wrote. “When told that a fictional female state senator was ambitious, however, men and women alike ‘experienced feelings of moral outrage,’ such as contempt, anger, and disgust.” The rage is more aggressive in men, but it’s there in women, too.
As those of us opposed to Trump and Trumpism absorb the trauma of what happened in America on Tuesday night, there are going to be vicious recriminations on the left. I don’t begrudge any Bernie Sanders supporters the consolation of thinking that their man could have saved us from this calamity. All of us are grieving, trying to make sense of the worst thing to happen to our country in modern history. All I can say is that I’ve been to Trump rallies in the Midwest, South, and Northeast, and I never saw a single sign or T-shirt about free trade. I never heard chants about NAFTA or TPP. What I heard was “Trump That Bitch” and “Build That Wall.” When Clinton delivered her heart-shredding concession speech, traders on the floor of the New York Stock Exchange reportedly booed and chanted “Lock her up!” They know Trump’s victory was no rebellion against Wall Street.
Over the summer, University of Michigan researchers Carly Wayne, Nicholas Valentino, and Marzia Oceno surveyed 700 citizens, asking them whether they agreed or disagreed with statements such as, “Most women interpret innocent remarks or acts as being sexist.” As they wrote in the Washington Post, the researchers found that “sexism was strongly and significantly correlated with support for Trump, even after accounting for party identification, ideology, authoritarianism and ethnocentrism.” It’s striking that Zephyr Teachout, perhaps the congressional candidate most closely aligned with Sanders’ ideology, lost her upstate New York House race by a significant margin. Maybe Sanders could have won the general election—but not because his politics were better than Clinton’s, even though they were.
Had Clinton won, she would have done more than shatter the glass ceiling. For 25years, she has been a synecdoche for unseemly female ambition. (In 1996, a 4,000-word Weekly Standard essay titled “The Feminization of America” ended with these words: “To put it more simply, Hillary is welcoming men to their new role as the second sex.”) Clinton ran for president on an explicitly feminist platform and promised a half-female Cabinet. Her victory would have been a sign that the gender hierarchy that has always been fundamental to our society—that has always been fundamental to most societies—was starting to crumble. It would have meant that men no longer rule. We have to come to terms with the fact that a majority of men would rather burn this country to the ground than let that happen.
One optimistic assumption undergirding the Clinton campaign was that we were moving toward a world in which gender would become less and less of a fetter on the shape of our lives. In such a world, women would have as much claim to leadership and full citizenship as men. Two weeks before the election, I went to a rally that Clinton and Michelle Obama held in Winston-Salem, North Carolina. They were introduced by women: former North Carolina Sen. Kay Hagan and Democratic Senate candidate Deborah Ross. “Little girls hear the ugly things that have been said about women in this campaign, and it makes them feel terrible and doubt themselves,” Clinton said, and it struck me as unusual for a politician to speak about little girls’ feelings as a matter of political significance. For one afternoon, the rally offered a vision of what political stagecraft might look like if it were practiced by women and for women. Looking around, I thought, Maybe this is how politics feel for men all the time. And then I thought, No wonder they don’t want to give it up.
Still, I thought we were going to get there. I thought my daughter was not going to be consigned to a lesser life than my son. I no longer do. We are going to lose Roe v. Wade. There will be no push for paid leave (whatever Ivanka Trump might promise) or a higher minimum wage. If Trump’s campaign is any indication, our new administration will be a priapic junta. Roger Ailes was too toxic to remain at Fox News but not too toxic to be a close Trump adviser. Campaign CEO Steve Bannon has been charged with domestic violence and accused of sexual harassment. As Indiana governor, Vice President–elect Mike Pence signed a cruel law mandating the burial or cremation of miscarried fetuses. Trump’s first campaign manager, Corey Lewandowski, grabbed a female reporter so hard he left bruises on her arm, then tried to smear her as “delusional.” Trump senior communications adviser Jason Miller took journalists to a strip club the night before the Las Vegas debate. “Women, you have to treat them like shit,” Trump once said. It might be America’s new unofficial motto.
Michelle Goldberg
#HillaryClinton #DonaldTrump #USElection
Something else to do ...
Want a break from the cream of American presidential election’s sound bites? (now, whatever happened to my copy of Sartre’s Nausea?). Well, some light relaxation of geo-politics may be in order. How about the excellent report on today's Russia by the Economist, edition 22-28 October? Factual and sober, with slivers of hope here and there, it is a topical read for October, an evocative month. Fascinating chart below from the essay. The cover is cheeky and really not meant to be funny. Check it out, print or digital.
Long Vo-Phuoc, 6 Nov 2016
#Russia #GeoPolitics #TheEconomist #OilPrice
The Judgement of History
Above article published by George Monbiot on July 7 on www.monbiot.com (July 6 on the Guardian).
(The other World Cup is now on (no, not the real one in London a few weeks ago, with teams like Tibet, Rohingya, Tamil ...., see blog June 2018, below), so I suppose it's fitting to pin here the one I wrote back in June 2016; too lazy to write another pointlessly. But really what HAS the world come to? The Dutch aren't in Russia to show off their skills - whatever remaining from Cruyff's days, and neither are the Italians; yet teams like Australia and Iceland are able to kick the round thing here and there (though those "-sons" from the icy land are doing pretty well, þakka þér kærlega fyrir!). What has the world come to indeed ...... (And it's really 44 years on now, not 42, from that dreamscape 1974. LVP, 2018.))
(This article should have been in the "Time Slows ..." Page, or even in the "1973-76 & Rho", but somehow I put it here in the first place, political reminiscences (really!) and all. I do miss 1974, and I do miss Cruyff. LVP, Feb 2019.)
Euro Cup 2016, and Cruyff of 1974
Long Vo-Phuoc
So it’s France v. Portugal in the final. France with home advantage, having edged out the ever-reliable and entertaining Germans, and Portugal with the prima donna Ronaldo.
I miss the old Portuguese team 20 years ago with the likeable and busy Figo (who was nice enough on the field), as I can’t bring myself to liking Ronaldo. Here is a guy (Ronaldo, not Figo) who insists on being the captain for his national team yet never directs play; who always gets rid of the ball rapidly, not necessarily with clean or clever passes, to his teammates so he can quickly run to the area waiting to score; who never builds anything up from mid-field even though he carries a number 7 shirt.
Makes one miss the action of a real captain, a guy like Lahm not so long ago, and those old chaps of yore: the like of Figos that one sees on TV for the last 20, 40-odd years and, yes, the unforgettable Johan Cruyff.
In 1974, watching the World Cup from West Germany on black and white TV was a far cry in pleasure from listening to the radio many years before (with the ever-repeating sounds of “Ngon/Thuan” of Quan Thue (Customs) Club and “Chieu/Ngau” of Tong Tham Muu (Headquarter) to a kid in early teens). Close friend didn't seem keen in football so one followed the tournament’s progress instead with other wide-eyed chappies, eagerly waited for the final that was to be telecast live in the wee hours - was it two in the morning?
It was July, the mid-year break from the university. There were Brazil, Argentina, etc. and a whole host of supporting characters, mostly European. But the setting scene was really all about the last match between the probable two teams, the host, the deadly-serious and very professional West Germans, and the exciting, outlandish, fleet-footed “total football” Dutch led by - who else? - Cruyff. This was what the Dutch did on the way to the final to opponents: 4-0 Argentina, 2-0 East Germany, 2-0 Brazil.
Cruyff did everything for his team (and he was the brightest star in commercial terms, too, never mind that he might break his own legs running into opponents on the field). He organised delirious attack from mid-field, threw in the ball from the sides, directed the ball from the corners, brought the ball to the area, passed to mates, got chopped, got up, got the ball, shot down, and did it all over again. In 1974 football contact on the field was brutal, rules were hard to come by, and the West Germans had a fearsome reputation – read about the World Cup final between West Germany and Hungary in 1954’s Switzerland.
Attack was only half the picture, Cruyff directed the defence, too. He ran back, sharing the hard slouch job with his mates back at their own area. He ran forward, backward, sideway on the right, sideway on the left, jumped for the ball. He was a blur in every match from what I read on the newspaper (only matches involving Australia was telecast, which were only during the first round, plus the final, on the ABC). And when I saw him in the final, indeed he was a blur, super energetic.
The German tabloids screamed: “Who cares about Cruyff!”, said one; “Beckenbauer will teach Cruyff a lesson!”, said another. But we all knew who was the star, the heart, the soul, the dashing striker, the passionate defender, the seemingly inexhaustible captain, the gentleman footballer of the final, of the whole Cup. It was Johan Cruyff, through and through. Beck wasn’t a bad captain himself, but it was simply fitting that Cruyff was voted the player of the tournament.
Ah, 1974, a time of innocence and wide eyes. A time of freedom, of a rich world morally recovering from past brutal mistakes and trying to make amends, not succumbing to lousy bureaucracy and commercial exploitation, not going all-out for blatant consumerism, not ever-ready for blanket denial and cover-up, not arrogant, not bloody-minded, not readily resorting to arms and ignoring history and errors, not flaunting riches and muscles, not blindly ganging up with each other, not biting and spitting on the feeding hand of its own citizens; a rich world that perhaps, just perhaps, genuinely wanted to do better for all. I miss 1974.
Long Vo-Phuoc – forty-two years on
#1970s #reminiscence #1974 #JohanCruyff #Euro2016 #WorldCup1974 #WorldCup2018 #þakkaþérkærlegafyrir
Seasons Greetings
Towards the year's end I quite like two articles and a book:
1. Pregnant Silence – by George Monbiot (UK) of the Guardian newspaper. It's on his site monbiot.com or use the following link:
http://www.monbiot.com/2015/11/19/pregnant-silence/
2. The Ethics of Killing Baby Hitler - by Matt Ford (US). It’s currently on theatlantic.com, or the following link:
http://www.theatlantic.com/international/archive/2015/10/killing-baby-hitler-ethics/412273/
3. The Invention of Nature - a biography of Alexander von Humboldt by Andrea Wulf (UK).
(... And there's always Alice Munro for reading at Christmas or any other time.)
Long Vo-Phuoc, Dec 2015.
Kicking and screaming
Long Vo-Phuoc
So, the Fed was dragged kicking and screaming to the altar of central-banking governance for a paltry 25-point rise. A forest had been cut for newsprint by commentators not having anything productive to do. Self-justifying sound bites from the ten public servants, Yellen to Brainard, filled tiresome talk-fests for months on end, polluting the ears of luncheon serving staff. A galaxy of electrons has been blasted to kingdom come to enable digital saliva for loquacious cyber busybodies and market platform gyrations caused by petty HFT robots scurrying around for a tick here, a bip there, up and down and round about, a hundred thousand (nah, a hundred million, each) times over ...
All for, to say it again, a paltry 25 basis points from 0.00%. As per: it is now 0.25%pa Fed funds rate.
A circus making a big fuss.
Long Vo-Phuoc, 17/12/2015.
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The Fed can’t stomach even a slightest dose of much needed medicine
Long Vo-Phuoc
It is astounding that Janet Yellen & co. couldn’t swallow even a small pill to help cure their bloated ZIRP disease. And I mean a pill with the potency of a pea.
The US economy is near or at full economic employment, at 5.1% unemployment rate. The US GDP growth, a statistics that, like the jobless rate, does have its shortcomings but is still more reliable than that of most other nations, is at 2.5% pa. and likely to extend a little further. The housing market has fully recovered since its necessary half-demise eight nine years back, and is now moving ahead sure-footedly. Wages have been slowly but steadily improving for a year. Core inflation is currently at 1.5 % pa. Commodities prices are lowest in a decade or more, supporting import and manufacturing. Retails sales are nicely sloshing along. The sharemarket is near all time high, having experienced a recent child-play 6% correction. Long bond prices, after again a 6% correction, are still over the rainbow in historical terms due to the ocean of liquidity from the Fed and its cousins world-wide.
You'd think with that background the official interest rate would already be 2% pa., and last night’s kerfuffle would be all about a contemplation to push it to 2.5%, just to be on the responsible side.
Yet ZIRP (“zero interest rate policy”) had resolutely maintained Fed funds rate at 0.05% pa. for half a decade. Twenty years ago an economic commentator when hearing that would beg our pardon and ask if we had stuttered so badly – you meant 5%, not 0.05%? You meant five hundred points, not five?
Incredibly, despite all the reasons for the obvious, Yellen & co. could not stomach a twenty-five basis point rise. That is, to make ZIRP a little less ZIRP’ed, at 0.25% pa. (or 0.30% pa. if you are truly pedantic).
Wow, how history repeats in the most cowardly fashion.
Remember Alan Greenspan with his then ultra low interest rates of 1% during 2003-2004 (and that with a Fed balance sheet of “only” 7% GDP - it’s now almost 20% and we’re talking many USD trillion here)? Remember his tiresome procrastination with raising rates, and, when the hikes finally came in 2005 while the economy was already nicely growing, it was only with “measured” baby steps in every drawn out meeting? Remember the explosion of financial engineering (a concoction started in the late 80s but employed only between professionals until the early 00s) due to the low interest rate environment? Remember the numerous childishly absurd papers from maths PhD academic chappies written for, and paid for by, investment banks on “pooled mortgage risk” to justify the deadly triple-A rated subprime “bonds”? Remember those mortgage loans stuffed down the throat of all and sundry, including those who hardly worked or hardly wanted to work? Remember when US house prices went up and up? Remember when Ben Bernanke first denied there was a housing bubble, then insisting the bubble would sort itself out, and finally, not so long prior to the Lehman moment, the bubble wouldn’t affect the economy?
2008 eventually came with all its vengeance and hardships for those who could ill-afford, while Bernanke & co. (Yellen included), sundry regulators and investment bankers cheerfully received their paychecks through thick and thin.
What were the words used by the Fed last night? Something to do with “uncertainty/confidence”? Something to do with “the global economy”?
What wimps, what babies in the woods!
There was no confidence crisis in the US economy yesterday, the last six months or the last three years for that matter. Any semblance of such “crisis” would only come, nauseatingly frequent, from the market and its players: the banks speculating their prop books thanks to the largesse of Fed QE liquidity, the hedgies many with odious HFT algorithms scratching around for an extra billion or ten, the private equity boys scratching around for a billion or ten, the speculators in bonds and shares and properties world-wide scratching for a billion or twenty, here and there and everywhere. Any abnormal uncertainty, any crisis of confidence in relation to a twenty-five basis point move from 0% pa. (pardon, 0.05% pa.), resides well and proper in the mind of these groups.
My advice to Yellen & co. is this: sure you do need to listen to the market, but always with a large pinch of salt. You don’t let them push you around.
Now, the “global economy”. Yes, such a thing always has its own nuances and problems. Europe with its many self-interest grievances in manoeuvring economies and interest rate and the existential question of fiscal or monetary marriage since the late 1990s; and whether to share or not to share Germany’s trade surplus fortune. China? Bloated for so long with huge stimuli and local governments’ property development shenanigans, added by decades of over-rapid growth, it does need to brake before driving elsewhere. It’s a growing pain one has to endure (and if countries like Australia Brazil and Canada want to interpret such growth, as they did only a short while ago, as a 60-years’ “super-cycle”, well, a fallacy can only be so seductive for so long).
Yes, the “global economy” has its own ups and downs, but these would hardly be influenced by a minimal 0.25% rate rise (from 0%) needed by the US economy. The emerging markets’ currencies may or may not move out of line because of it. In fact they already had. A moderate reverse might even occur after a US rate rise. All in all, whatever these concerns are, shouldn’t a 25 point hike happen now rather than wait till the Fed is well behind the curve and 1994 to happen all over again? A little volatility now rather than chaos in a few years? Bread now, or rotten fruitcake later?
Let us, therefore, again call a spade a spade. The Fed are wimps, inexperienced wimps, and are causing huge problems for themselves and their nation months and years down the track.
Let me repeat my advice to the Fed: (i) treat market punters for what they’re worth: the like of Goldman Sachs, JP Morgan and BlackRock are full of self-interest and no intellectuals in any way; (ii) do the right thing for your own economy first, before grandiose babbling about global this way and that; and (iii) learn the lessons of history.
Because this is what we had earlier today: an 8-1 vote for staying pat (Lacker the dissenter), then immediately had doubts and promised to the market (!) that if an October move was “viably possible” there would be the fanfare of “a special press meeting”.
Good heaven, what a circus.
Long Vo-Phuoc, 18/9/2015
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(Chart below from St. Louis Fed)
