Rant from Russia

Mon, 2009/12/07 - 5:32pm | Your editor

I am publishing the following rant from a sometime contributor in Russia not because I agree with it, but to encourage U.S. readers engaged in global investing to think about the political baggage we bring with us. He writes: 

Americans have subverted some 50-odd governments since World War II. Quite a record.

Think Iran. Wonder why they love you so much? A bit of bad luck and they will get the chance to roast you (and lots of other innocent bystanders). Any chance the roots of this distaste go back to 1953? And decades under the Shah? Read more »

Riba Bad News

Fri, 2009/12/04 - 3:42pm | Your editor

    Financial advisors seem to think that Moslems have special rules for loans. According to Wikepedia, "The generation of money on top of money, interest payments or 'Riba', is strictly forbidden by Shariah law."

In fact similar strictures against interest exist in Christianity and Judaism too. St. Thomas Aquinas thundered against charging interest, which he called 'filthy lucre'. In Medieval Europe, the wealthy were viewed as having sold their souls to the Devil. To escape Hell, they donated what they had accumulated to fund monasteries and Masses for their souls. Filthy lucre accrued to the Church. Read more »

William Jennings Bryan

Thu, 2009/12/03 - 3:19pm | Your editor

There were many political upheavals in American history between the Boston Tea Party in the 18th century and the ones being backed by the far right today.

Stimulated by the recent TV bio of Woody Guthrie and the death of folklorist Bess Lomax Hawes, both once part of the left-leaning Almanack Singers, I recalled one of their well-known folksongs, dating back to the very late 19th century.

It got sung first during an earlier economic crisis after William Jennings Bryan delivered his powerful words, "You shall not press down upon the brow of labor this crown of thorns; you shall not crucify mankind upon a cross of gold," in 1896 at the Chicago Democratic National Convention.Of course we now have the Fed to create money. Read more »

Florentia's Warning

Wed, 2009/12/02 - 6:30pm | Your editor



When
you're wounded and left on Afghanistan's plains,


And the women
come out to cut up what remains,

Jest roll to your rifle and blow
out your brains

An' go to your Gawd like a soldier.
(Rudyard
Kipling)

Read more »

Kurzarbeit and Caesar

Tue, 2009/12/01 - 4:11pm | Your editor

 

Australia again followed Israel, raising its bank rate 0.25% to 3.75%.

Here is a message about Kurzarbeit's benefits and costs from Marc Chandler, of Brown Brothers Harriman, the surviving US investment bank linked to a NY Governor; Lehman Bros. was the other.

His analysis is important because many economists feel the need for US measures to cut unemployment, including a revival of the New Deal's WPA (suggested by Paul Krugman in the NY Times.) Read more »

Makhulah

Mon, 2009/11/30 - 4:55pm | Your editor

Dubai is makhulah, to use a word that is probably not familiar to those in its souk, and its stocks and bonds are worth bupkas. (Souk is market in Hebrew and Arabic; makhulah is Hebrew-Yiddish for bankrupt; bupkas is Yiddish for nothing.)

 

This is probably a sandstorm in a teacup on the scale of the world economy, but it serves to warn investors that there are still risks around not covered by the huge increase in liquidity by central banks which has sustained the extraordinary rise in global stock markets since March. With institutional investors wanting to lock down gains for annual reporting purposes, there may be a trend to profit-taking over the remaining few weeks of the year. Read more »

Don't Buy Dubai

Fri, 2009/11/27 - 6:47pm | Your editor

Don't buy Dubai. Normally after a market panic my speculative juices get flowing. But not over Dubai.

Its overdone economic panic was fed by the loan repayment holiday announced just as the region closed down for Eid. This came a week after the ruler, Sheikh Mohammed bin Rashid al Makhtoum, fired his economic advisors and replaced them with family members.

That makes clear one special risk of investing in the Persian Gulf emirate, one of 7 mini-countries sewed together into the UAE in 1971 by the British, who had protected their independence for over a century against the expansion of Saudi Arabia. Emirates are run by emirs, absolute rulers who head tribes. Their personal purses and their mini-counties' national accounts are hopelessly confused. It is something like trying to separate the debt of Henry V and that of his kingdom after he spent England's money on a campaign in France. Read more »

Dining on Peru

Wed, 2009/11/25 - 4:39pm | Your editor

     Back in the USA, I want to apologize to those who sent me an e-mail via the www.global-investing.com website. This mail did not get forwarded by my Time-Warner roadrunner e-mail service so your messages could not be dealt on my travels. Just about the only e-mail that works these days is spam. The real stuff becomes the target of anti-spam systems but the fake gets through. It is as annoying as airport security checks and works less well.

 

Israel did what Citigroup forecast. Its CB raised interest rates by another quarter point to 1% and this hints at continued incremental rate increases by other countries in the same happy situation as the Jewish State. These include Australia and Norway. The impact of higher interest rates is negative for exporters but positive for yield seekers. Read more »

Anglo-Saxon Economics?

Mon, 2009/11/23 - 7:28am | Your editor

We tend to take too seriously comments about there being something called Anglo-Saxon economics. The is no such thing as Anglo-Saxon economics, unless you are referring to the barter done by hunters in the 5th century AD. The term is popular with Continental European critics, but very inaccurate.

A simple comparison of the economic policies of Britain and the USA should disabuse those arguing that they are on the same track because of their common language, their common intellectual heritage, the fact that most recent economic gurus wrote in English.

And if you add in the outrider English-speaking countries like Australia, pursuing exit strategies like higher interest rates because its slump is over thanks to raw material exports, it quickly becomes apparent that there is no standard single Anglo-Saxon model. Read more »

Beauty Can Get Ugly

Fri, 2009/11/20 - 5:52pm | Your editor

We need a woman heading the Senate as well as the House of Representatives. This is my reaction to the sexist proposal to slap an excise tax on cosmetic surgery to finance healthcare reform. We need women in our upper house. A jab of Botox, a breast enhancement operation, some work under the eyes, will be taxed at 5%, an outrage by the male Solons of the Senate.

While sometimes men pay for their significant others' operations, it is almost always women getting cosmetically enhanced except for the occasional gynoplasty or hair implants, Women's happiness and success in life depends on their looks. Attractiveness pays off for the ladies, so why should they be taxed for this?

There will be a great rise in Yankee medical tourism, already luring seekers after beautification to operating rooms in Czech Republic... or Brazil. In fact, the Brazilian problems of an appreciating currency will become worse with more beauty-seekers coming to Rio for a bit of improvement and a vacation.
Read more »