CheetahhhhhhhBlog Mark III

First of all we’re worried about my nephew Also, who is sick. If America was within taxi distance we would be there for moral support.

Today was a very busy day. We woke up as usual around 11AM but it was go-go-go after that. We went to the Mega Mall AKA the “megala” according to Bug. This stressed me out a bit because there are so many damn people here in the Far East, furthermore I hate shopping. I got new glasses because I’ve been having headaches recently, which is strange because I never have headaches, and the correlation I think is my eyes are a bit worse. Actually by most people’s standards my eyes are pretty good, but I have an astigmatism and things in the distance are growing more blurry. At the megala there is a deli “Almon Marina” with good cake. This is a total miracle in the Far East and I had a succulent, juicy carrot cake. I also had a moderately good sandwich which is also a miracle because of bread problems, and a lack of clear understanding here in the Far East what a sandwich is and what you can do with it. Well at Almon Marina they know what a sandwich is. I give the joint an A-.

Tristan has turned from a sweet baby into a total rascal. He can now climb up onto the bed, onto tables, etc, and wants to get into everything. In retrospect Bug was a good baby and little trouble, partly, we think, because he’s lazy. Tristan is not lazy at all. Endless energy, which makes for endless trouble. Today in the deli he crawled out of his cart and was suddenly streaking across the restaurant. He will also wake up from sleep if he hears any food sound. He will also lurk by the refrigerator waiting for somebody to open it. He’s like a cat.

The government’s lack of action on unemployment is disturbing. As always in this blog I refer to the USA. I don’t have the energy to worry about politics anywhere else. Anyway I remarked in an earlier post that what the USA needs is a New Deal style jobs generation program, not all this nonsense like cash-for-clunkers, which was just a short sugar high that solved nothing. Indeed I might point out on a personal level that I wanted to return home to the US this past January, and I still want to return home now. I’m still abroad because my prospects for good employment are very slim at the moment. Indeed it’s hard enough getting a decent job in Madison WI during good times. I keep watching the unemployment figures and it’s a grim picture. Seeking Alpha writes,

Bernanke doesn’t care about high unemployment, Daniel Gross says, perhaps because the Fed is “simply exhausted… having used up all its resources in saving the system,” or it’s a “failure of imagination.” Either way, he says, “expecting this Fed to have a sense of urgency about the unemployment rate may be as futile as looking for a Cadillac at the bottom of a Cracker Jack box.

Now isn’t an economic recovery with 16-17% real unemployment completely pointless? (By real unemployment I mean all unemployed people, not the statistical tricks the government uses to make the figure look better.)

I’ve taken an interest in Afghanistan lately and am pleased that Obama replaced Gen McCrystal, there’s no good in a divided effort, and further the general was obviously a fool.

I got my AUAF handbook and there are surprisingly enough a lot of restaurants in Kabul, and a Spinney’s, which is a relief. We could actually use a Spinney’s here in Manila. Spinney’s is an English chain grocery store and was a complete godsend in RAK, because locally made western food (such as bread or cake for example) is really below par. In truth I have yet to find good locally-made bread or cake in Asia. I love bread so this is sad for me here in Manila. Rustan’s has some passable frozen baguettes, and thank God for that, but that’s about it. So Spinney’s will lighten my day. The only drawback with Spinney’s is English prices. In Kabul it will most likely be double English prices because everything has to be flown in.

There is typhoid in Kabul and you should even brush your teeth with bottled water.

On a lighter note my health insurance with AUAF has kicked in, though those knuckleheads don’t insure pre-existing conditions for 6 months.

I was going to buy a Powerbook, er, a MacBook (I’m old school Mac actually), I’ve wanted one for several years now, but in the end couldn’t part with the cash. I bought the cheapest laptop with an Nvidia graphics card, which is a Filipino-made Neo. It works real nice and plays good Total War. $500. I’m actually quite pleased with the purchase.

Tristan’s obsession with food continues to grow, to more and more odd levels. Because he’s a Leo, he’s very assertive about anything he wants. Now I can’t drink my coffee in peace, he will sit there screaming that he wants a drink. Today he surprised us and climbed up onto the coffee table to get Bug’s coco-crunch. So nothing is safe anymore.

I really like the Spotify music service. I might even pop for a 4.95 sterling subscription. I’m currently listening to Wayne Newton’s Danke Schoen. I’m into 1950s gangster pop at the moment, Tony Bennet, Franky, etc.

For Father’s Day I’m getting myself a Macbook. Like most fathers I imagine, I haven’t actually bought anything for myself in a real long time. I’m getting it primarily for entertainment purposes in Afghanistan, ie playing Total War. Haven’t had a computer that could play my favorite game for several years.

We’re at the pool right now, and Bug is hanging out with some girls and eating their lunch.

I have withdrawn completely from the stock market for the time being. I’ll tell you why. My predictive indicator is the Shanghai Composite. Not a prescient indicator (not even God knows what will happen next in the stock market) but a reasonably good one. And the Shanghai Composite looks headed for the dreaded double-dip. Teggatz Enterprises has done remarkably well this year when you consider that this was the most challenging investment environment since, perhaps, ever. I’m hoping things return to normal soon so I can make some real money. I have my doubts about any normality in the near-term however. Governments keep pumping money into the system which makes the financial environment artificial and volatile. Right now there is a great transfer of wealth going on, from long-term investors such as pensioners and home owners with mortgages, into government coffers through the electronic creation of more money, and into corporate welfare for the likes of AIG and Freddie/Fannie etc. There is also the absolute certainty of higher taxes in the future (there is no other way to fund what is happening) and so value will be transferred from IRAs, etc. (indeed it’s smarter at the moment to not defer paying your taxes). What has resulted from the events of the last two years is, first, America has lost its pre-eminent position in the post-cold war world. Second, the weaknesses of the European financial union have become apparent. And third, the working man has (as always) gotten the shaft through the invisible transfer of wealth. This will become more explicit in the near future; for example Illinois among others is trying to renegotiate pension payments, which results in pensioners financing the government, who are in turn financing big banks, AIG, etc. I don’t mean to paint an unnecessarily grim picture here, but I think the next few years will be very challenging financially, despite the slow improvement of the US economy. I mean, many US cities and state governments are insolvent, for example.

I can’t actually name anything that Obama has done that has achieved a result. This health care reform, for example; I’m not sure what if anything it’s accomplished, though granted I’m outside the US and so might not have noticed something which the New York Times might have failed to mention. I’ve been rather critical in this blog of recent financial rescue measures and legislation, and though he may have averted a second great depression (MAY, we’ll never actually know), I also think the situation was handled poorly, for example what America needs right now is a New Deal-style jobs creation program, rather than big bank welfare. Maybe I’m just too populist for the modern age when I say this. And I’ve been paying attention to Afghanistan lately for obvious reasons, and our involvement there is, as far as I can see, a complete disaster and was actually much better managed under Bush (painful though it is for me to say). This environmental catastrophe in the Gulf with BP… well, I’m not sure what Obama could do, but he hasn’t done anything except yelled at BP. This recent speech where he called on Americans to “seize the moment” to “end America’s century-long addiction to fossil fuels.” OK this is good and I would like to see some follow-through, though I’m not holding my breath; I’m growing highly skeptical of Obama’s will or desire to actually accomplish anything. The only reason I even speak up about this is because I had high hopes for Obama.

Yesterday was Philippine independence day. We went to Rizal park where there was a military parade and a show of military hardware. This was tremendously exciting for Bug, who got to sit in a tank and hold a gun. I’m not one of those parents who want to keep their children away from guns. They are a reality and he’s only 3 and already knows all about them from TV, so I’m not going to bury my head in the sand. There were tanks and a gunboat and some other things there, but Bug was interested primarily in the guns. He went up to a Philippine special forces guy and said, “Excuse me sir, can I buy a gun?” which gave me a laugh. I told him guns were not for kids and he could have one when he was grown up. He accepted this. There are a bunch of pictures on Facebook.

Yesterday was eventful because we also rode a train. Very exciting for Bug. And we picked up his two cousins to join the excitement. And we rode a horse-drawn carriage, which was also tremendously exciting for Bug. Not so much for me because the jackass driver tried to charge me P2500. He settled for P800 when I said I would call the police. Still too much. Jackass. And then we went to one of the best restaurants in Manila, Kashmir in Malate, where I had a rockin good curry. Kashmir is ridiculously expensive by Manila standards, but the thing is, by Manila standards most of the time you are getting sub-par food. Indeed we don’t even bother with 95% of the restaurants for this reason. Kashmir serves really good food such as fresh stone-baked bread, and they charge American prices for it, but I’m willing to pay this once in a blue moon for a good meal.

I’ve been discussing gold as an investment bubble. You will note that today, Sunday, gold is on the front page of the electronic New York Times. This is a sure indication of a bubble reaching a breaking point. I might just short GLD, I bet you I’d make money. Indeed I have studied the situation rather carefully and have come to the following conclusions. One, these fears about the collapse of fiat currencies such as the dollar are patently ridiculous. The dollar has actually lost something like 95% of its value since 1900 (don’t quote me on this but the figure is reasonably accurate) so we are seeing the continuation of a long-term trend of inflation and devaluation. Second, the Eurozone crisis scared me and everybody else, but I have concluded for various reasons that it’s completely overblown. Perhaps Greece or Portugal will drop out of the Eurozone some day. Not actually a big deal, their economies are the size of Maryland. In a worse case scenario the Eurozone could collapse, in which the euro would revert to its previous incarnation, the deutschemark, and actually I would be more inclined to hold deutschemarks anyway. But bottom line, a whole generation of politicians are way too invested in the Euro and the Eurozone to let any short term crisis cause a collapse. Third, in the realm of bubbles in general, I would say that people are looking for investment safety given the economic events of the last two years, and this has paradoxically created a new bubble in gold. My prediction is gold will not rise much more, and may indeed have a good tumble, because in truth the economic situation in America is slowly improving. As always I could be completely wrong.

So it’s official, the US coastline is opened for shallow water drilling. This in spite of the ecological disaster in the Gulf. Not like Obama cares, but this is a do-not-cross line for me, and he just crossed it. Not sure who else I’ll vote for but one of the primary reasons I vote Democrat has been violated here ie environmental protection. If it wasn’t for this I’d vote Green or Libertarian and just may do so now.

Gold has been on my mind lately. I’m making a bit of a study of it, actually. There’s an interesting article in Barron’s this week where an analyst argues that the price of gold reflects the devaluation of the value of the dollar, not the rise in the value of gold itself. He argues that the bubble is not gold, but rather the electronic creation of currency. I’m inclined to agree, though there are more factors at work. Gold is also a commodity driven by market factors, a big example being Indian women and their love of bangles (this really does drive the price of gold FYI). Silver, platinum, and palladium have industrial and commercial uses. Another factor is market psychology. The unfortunate fact is that the majority of investors are uninformed and make emotional decisions based on little or no information, so you have to think about their psychology, and when Joe in Omaha hears gold is shooting up, he logs on to Etrade and buys GLD. He thinks he’s being clever whereas professional traders are waiting for Joe in Omaha to make his trade at inflated prices so they can sell. This is purely hypothetical but illustrates the big role psychology plays in investment.

I don’t think there are easy profits to be made in precious metals, unless the global economic situation seriously deteriorates. Which is a possibility.

Unfortunately we’re crime targets in this country. I’ve mentioned this before. The thing is, we’re “rich” here. I think this is a bit ridiculous, me being “rich” (notice the quotation marks) but it’s a fact that we have to deal with on a daily basis. I understand how the real rich feel, and their security concerns. It really opens up a whole slew of new concerns. One big concern, the most serious one which causes me a lot of anxiety, is the kids getting kidnapped. Seriously, it’s no joke. I’ve actually looked into kidnapping insurance. Another concern is mugging, which is very common. Vanessa doesn’t wear any of her jewelery here. I wear my Breitling watch but long ago decided I would actually fight somebody for it. It cost 4 grand so damn straight I’ll fight for it. But now I’m putting it into the safe deposit box, as I will explain. Another concern is burglary. I’m sure the local burglars are aware of my apartment and have noticed things through the window like the HDTV. As a counter to this I got a safe deposit box at HSBC a few weeks ago for the most important things.

Anyway today we were at the local grocery store. Van’s purse and Bug’s PSP were hanging from the push-handle of Tristan’s stroller. This is a reasonably secure location actually because presumably somebody has their hand on the push-handle, pushing the baby. Anyway Van was getting something on the shelf and some total bitch pretended to coo over the baby while she lifted the purse and PSP. She was very slick and we didn’t even notice for several minutes. She got about 1000 pesos, Van’s phone, and of course Bug’s PSP with his favorite game inside. I’m just not thinking about the incident because it would make me angry and want to chain-smoke. I cursed the bitch, and my curses are no joke, they involve not a quick death but rather long-term suffering.

Now I have to crack open the coffers and get Bug a new PSP which is an expense I would rather do without. I gave Van my iPhone which makes me sad because I love my iPhone.

Anyway that’s the scoop. Crime. The bitch.

It’s the rainy season here in the Philippines. Van wants me to mention this.

Filipinos have these birthday parties at McDonald’s or Jollibee, with loud loud loud loud loud music and Filipino spaghetti, which is spaghetti with sugar in it. I am not a fan of these events personally. We went to one today for one of the neighbor kids. Tristan loves the loud music and the dancing Grimmace. Bug as usual is afraid of the dancing Grimmace and hid behind my legs. Van enjoyed herself as well. I tried to escape but the family wouldn’t let me.

In my previous post I remarked that British Petroleum was going to be bankrupt by the time this crisis in the Gulf was resolved. For some reason I didn’t take my own advice. Yesterday BP shares had their biggest tumble in 18 years.

I said that I was going to go on vacation from finance. I have been unable to do so. Partly this is because I feel it necessary to put food in my children’s bellies. But also if I do not keep current with events, I will be unable to make intelligent decisions. So I still read the Financial Times. So I am relaxing a bit but not on vacation.

We are currently invested in a few hundred shares of Lloyd’s banking group LYG. I am gambling that the European crisis will resolve itself, which I’m starting to think it will, partly because of some remarks recently by the Detschebank chairman among others. However I’m not putting much money into this gamble; LYG is very cheap at $3.30 right now. I would like to make some other trades but the market is so volatile it is quite unsafe to do so other than on a very short term basis, which is not the way I like to do business.