Trees revised

Thu, 2014/01/16 - 3:16pm | Your editor

Blogs are made by fools like me/But only God can make a tree.

Back from the British Museum pre-Columbian gold exhibit from Colombia, I found my blog from this morning in need of editing. The page fought me because of a new JAVA download onto my computer overnight. I am not sure if it is a purely UK gremlin or a global one but I sure messed up my system. I have now removed it.

I also edited and cleaned up today's blog and added the newsletter tag stock symbols. Please visit the website at www.global-investing.com to read the corrected version if you are a paid subscriber. If you are a pre-sub what you got is unchanged. As the Brits say, frightfully sorry, old chap.

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Trees

Thu, 2014/01/16 - 9:08am | Your editor

It is Tu b'shvat today, the new year of the trees, a sort of Jewish Arbor Day. To paraphrase Joyce Kilmer, “I think that I shall never see a blog as lovely as a tree.”

Some nasty new software hit my computer overnight in London and I am struggling with it, so today's blog will be short as I hope to hit the Colombia pre-Columbian gold exhibit which I missed when we went to Colombia last year (we didn't go to Bogota where the gold museum lives.)

More for paid subscribers from Greece, Israel, Ireland, Spain, Canada, Colombia, Hong Kong, Britain. Mexico, Brazil, Singapore, and Finland.

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Better Than M&A

Wed, 2014/01/15 - 10:00am | Your editor

 

The wave of mergers and acquisitions is good news for investment bankers and for the executives who have guaranteed their own futures with, say, Jim Beam, from the acquirer. It is also good for their shareholders if the acquirer overpays (and they often do so.) But is this M&A wave  good news for the economy overall, and for jobs lower down the hierarchy? I think organic growth would be healthier.

And even better is when companies suing each other in court over soured deals or patents manage to negotiate a settlement which allows them to abandon the lawyers and just do business together again. The way is clear for growth when this happens.

And it did happen with two of our companies this week, discussed below along with news from North Korea, Mongolia, Myanmar, The Netherlands, Brazil, Colombia, Canada, Israel, India, Ireland, Finland, Africa, and elsewhere. Double issue today from wet but warm London.

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En Voyage

Mon, 2014/01/13 - 10:33am | Your editor

 

Your editor is off in a few hours for London and Paris. London is a usual destination, but Paris may be more significant. I am not thinking either of the "boss-napping" episode or the scandal over who is never-married Pres. François Hollande's current chosen mistress. I'm looking for a stringer ("pigiste") because my French contacts are getting stale. Details for paid subscribes below.

 

Only in New York. The Dessoff Choir, led by Christopher Shepard, with three professional singers, and a sing-along audience tackled parts of Johann Sebastian Bach's (ahem) "Prayer in B Minor." (Mass won't do for the version we sang, based on the Jewish liturgy.) The adaptation (or libretto) was by Dr. Eric Weitzner, who studied for the rabbinate before becoming a psychiatrist. The program cover shows JS Bach wearing a yarmulka and a tallith.

Some of the passages were easy, like using the Kadosh for the Sanctus or Sim Shalom for the Dona Nobis Pacem, since the texts are virtually identical.

Eric pushed things further with some of the more Christian (and non-Jewish) bits of Bach's theology. No agnus dei qui tollat peccati mundi; he used part of the Yom Kippur liturgy about forgiveness. No crucifixion or resurrection of Jesus made the cut; instead we had a reminder that Judaism also teaches the resurrection of the dead (by their Creator, God).

In place of the Spiritum Sanctum, (and pushing things) a text about how Moses was given the entire Torah including the later books and "this Torah shall not be changed, and there shall never be another Torah." This is from the Talmud which was reacting to the doctrine of the Trinity.

 

More for paid subscribers follows before I jet off from North Korea, France, Britain, Brazil, Canada, Spain, Israel, The Netherlands, and India.

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Tables Posted

Sun, 2014/01/12 - 11:30am | Your editor

I have just posted the tables at www.global-investing.com and now am off to a weird concert at Temple Habonim on the west side. Bach's long, quirky, Latin-language B Minor Mass is being sung with Hebrew words. These will apparently be authentic Jewish prayers, not bits of the Mass. This Bach set to music based on themes from dozens of his works. It is meant to be sung in Latin despite Bach being a Protestant at a time when Protestant services in Germany were sung in German.

I have no idea what to expect. I'll tell you tomorrow if we survive the ecumenical experience.

The newly posted tables are the first full set for 2014 and they show the current trends: Canadian stocks bought in the US are down sharply because of the floundering loonie. However, we have a fund specifically to protect us against weak knees up north, and own one Canadian directly because it doesn't trade regularly in the US.

Gold funds and stocks have inched up in 2014 and we also have a gold-linked bond bought recently. Biotech is hot and we are seeing fat gains.

We also did three trades summarized in the tables for paid subscribers.

As always to read the tables you are allowed to see (closed positions for all, and the current stocks, bonds, and funds for paid subscribers only) sign in to the website using your email and password. Then click the "printer friendly" under the masthead to make the spreadsheets more easy to see on a normal computer screen (even if you don't print them.)

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Judy, Mathew,Teddy, and Angela

Fri, 2014/01/10 - 12:51pm | Your editor

Gossip follows. Judy, the first Radcliffe AB economics major ('63), luckily has retired from the Alcoa board. Not only did the traditional first NYSE share to report on 2013 results badly miss its numbers; but also an AA sub is caught in a scandal over bribes to get approvals for a Bahrain aluminum smelter.

You can get away with cheating at Harvard without having to change your name, as did SAC's Mathew Martoma (born Ajay Mathew Thomas). When he first ran for Senator in 1961, we learned that Teddy Kennedy had been expelled from Harvard for hiring someone to take his exams. He didn't change his name which then was his main vote-getter.

The latest Economist has an essay on the definition of who is a Jew on which you are well informed after my tale of our new half-Korean chief rabbi. One reader who attends Central Synagogue objected to my support of Angela Buchdahl because she thinks Koreans are sentimentally prone to support religiosity. Frankly, I don't thing Rabbi Buchdahl, while born in South Korea 41 years ago, is notably sentimental or Korean. She is more of an intellectual with leadership qualities although I would prefer a new cantor rather than keeping her in both positions, mainly to get back to the organ and away from the guitar.

Wall Street's suffering so far this year is not because of the weather, it appears, but because of the poor Xmas shopping season. Sales and profits came in below projections because of extreme price cutting and consumer resistance to shopping. This hit many retailers, on-line and store-based, luxury and proletarian, US and foreign. More numbers are coming out but the trend is clear.

Lack of retail profits is offsetting the moderate rise in employment as the numbers pile in. Unemployment in the USA is now 6.7% despite a disappointingly low hiring rise.

The dollar has fallen against most currencies today, except the loony because the US payroll numbers were disappointing. The C$ was at under 91.5 US cents because Canada unemployment rose to 7.2% and 45,900 new jobless claims were booked in December.

The 3 winners of 3-month Financial Times subscriptions from our contest will get issues once the forms have been processed, within a few weeks according to the newspaper.

More from Korea, Norway, Israel, Indonesia, The Netherlands, Finland, Singapore, Australia, Colombia, China, and Canada.

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Dubious Statistics

Thu, 2014/01/09 - 2:41pm | Your editor

China further undermined optimism with new statistics showing that purchasing managers bought less goods in Dec., the 22nd monthly decline. We are still in that market but with care. Of course it may all be fake numbers to get Beijing to ease capital controls

Martin Ferera highlighted a controversy over dubious African GDF statistical data which may mean that Nigeria has a larger economy than South Africa's. However, Jo'burg is easier to invest in.

The weather has turned from Siberian to merely Canadian, and moreover the building has repaired my broken office radiator. I am comfy at last. Today I suffered both a nightmare and a nose-bleed delaying this issue.

I'm off to possibly warmer and wetter climes Monday night, to London and Paris. No blog for Tuesday; work resumes Wednesday.

Today we have a stock purchase and lots of pharmaceutical news, although no nostrums for nightmares or nose-bleeds. News from Britain, Israel, Singapore, Spain, Ireland, Holland, Hong Kong, Singapore, Korea, India, Jordan, and Canada.

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Siberia Stock Picks

Wed, 2014/01/08 - 12:16pm | Your editor

Der Spiegel is keen on Africa and cites the rise of traffic jams in major cities as a sign of boom, along with glittering shopping malls, and new infrastructure like highways, railways, airports, dams, power plants, pipelines, and factories, to say nothing of industrial parks and 'special economic zones.'

The German news magazine credited greater political stability, economic reforms, and technological innovations as forming a basis for its optimism about Africa. On politics, Der Spiegel believes 25 out of 54 African countries have "halfway functional democracies", whatever that may mean, up from only 3 twenty years ago.

And while it may not make the headlines, there has been a decline in violence, civil wars, and military coups.

Meanwhile the communications and information sector are being revolutionized by modern data transmission from Cairo to Cape Town, and points in between, with Internet and mobile phone use exploding. Local IT experts are letting Kenya skip the intermediate steps of modernization with instant digitalization. This stimulates the economy and changes society big time, the Germans think.

The result is a new middle class of 310 mn Africans, about as many as the total population of the USA.

Our Zimbabwe-born reporter Martin Ferera describes the article as "somewhat breathlessly positive."

 

Another Siberian day. Last night I did my religious duty, to vote in a new rabbi at Central Synagogue, a Reform temple where we belong. This required traveling 10 blocks by bus rather than my cold feet. The bus was very crowded, not with people, but with their garments. Everyone took two seats.

The new rabbi, to take over in June, is Angela Buchdahl, not only the first woman to be named a senior rabbi at Central (which had 11 before her) but also the first of Korean Buddhist extraction on her mother's side. This causes some difficulty with more Orthodox Jews who consider religion to be transmitted by the mother, not by the father. That doctrine is post-Biblical, as Moses's wife Zipporah was the daughter of the Egyptian High Priest of Om.

 

I examined our portfolio with an eye to finding stocks likely to benefit from the Arctic cold, and I found 3, moreover all beaten down so far this year. I also put in a sell. Today we have news from Jordan, Mongolia, Singapore, Israel, Canada, Ireland, Hong Kong, Britain, and Latin America and Africa overall.

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Bear In A China Shop

Tue, 2014/01/07 - 1:04pm | Your editor

A bear in a China shop has emerged, John-Paul Smith, senior stock analyst with Deutsche Bank. In a report published in mid-December, Smith said the same preludes to a stock market collapse which hit Russia in 1998 can be detected in Chinese markets today.

Symptoms of trouble ahead include excessive growth in corporate borrowing levels. He said in a Bloomberg interview Dec. 12 (only published this week): "There is potential for a debt trap in industrial companies which could trigger an economy-wide financial crisis as early as next year." That means 2014.

Smith, a British Oxford-grad historian, has been bearish on China and emerging markets since he moved to DB from Pictet Asset Mgm. in 2010. He made his negative calls on Russia earlier, while at Morgan Stanley after visiting Russia.

Last year his Cassandra prophecies panned out but he is not switching course (as he did over Russia in 1999 after the market drop.) He still thinks China is at risk of crisis.

He expects growth in the PRC to fall to below 5% over the next few years. Only then will the incentives for a turnaround in production and financing make the market cheap as Russia was in 1999.

China's total credit out, including off-balance sheet financing through non-banks, is now well over twice the country's gross national product, according to Fitch Ratings. Smith adds: "It is really at the corporate and the micro level in China that the fate of the financial market and the economy [will be] determined. China is not a safe haven as most commentators appear to believe."

Smith tends to be premature both in his forecasts of doom or recovery. He thinks China's slowdown could cause a 10% fall this year in emerging market stocks overall. "If I am wrong on China," he told Bloomberg, "I am wrong on everything."

 

My company renewed accounts on www.godaddy.com for our website and search engine visibility. But instead of starting the renewal after our existing subscription runs out in March, this huge company, having billed us, did not honor the c2 months left on the earlier subscription. If I did tricks like that to subscribers, I would be ashamed of being dishonest. Why does a major internet domain company cheat its customers in ways my tiny firm would not consider? Forget about calling to complain. You are surveyed about your satisfaction as soon as the credit charge goes through.
While there is a place to make your discontent known, I suspect nobody reads those comments. And to phone in you have to put up with c15 minutes of repetitive rap music which drives me away. So I am grousing in print.

There are no free 3-month subs left to The Financial Times. I had only 3 to offer and they are taken.

More for paid subscribers follows including hot news (needed in this weather) from Finland, Britain, Mexico, Israel and Spain, plus Singapore, Brazil, Belgium, and Hong Kong.

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Polar Vortex and BISIT

Mon, 2014/01/06 - 12:47pm | Your editor

Today we learn new vocabulary. What has hit North America is a stray but very big "polar vortex". Said vortex exited its normal persistent cyclonic track around the North Pole, moving south into densely inhabited lands, hitting flat open sites (like airports) the most. That explains the weather.

The "fragile 5" or BISIT is defined in today's Neue Zuercher Zeitung, emerging market countries with high political risk: Brazil, India, South Africa, Indonesia, and Turkey. Mysteriously, Thailand, Hungary, and Ukraine are left out of the anagram. My idea is a 7-country list called BISTUITH. (I tried for to BISTHCUIT but I don't think any of the C emerging countries with accessible markets have high political risks: China, Colombia, Chile. Côte d'Ivoire would fill the hole but who invests in Abidjan?) Read more »