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Money matters: The end of the Western World we have known since 1945
Part 2 - Discontinuance of the Publication M3 figures
Graham Macdonald
MBMG International Ltd.
Our second point is the subject of the US Federal Reserve
announcing it will no longer be publishing M3 figures, putting the normally
arcane subject of the money supply at the centre of a conspiracy theory and
controversy. Is the US government on a mission to reflate the US economy by
generating excess liquidity whilst appearing not to be doing anything? In effect
the Fed can appear to tighten monetary policy by raising rates when it’s really
loosening controls on the money supply without disclosing what they are doing.
This is referred to by Economists as ‘monetisation’.
The Fed claims that not releasing M3 figures is a cost cutting exercise (they
will still be calculated, just not released!). Those with a sceptical approach
believe the appointment of Ben Bernanke supports their case since he famously
remarked two years ago that if the US economy was running into trouble, the
government would print money to get the economy moving. But if under Bernanke
this happens, where might the excess liquidity in the money supply show up? In
the discontinued M3 figures!
Admittedly there are those who believe the M3 data is the best source of
analyzing the direction of central bankers and this departure continues to be of
significant interest to them. However, Jim Rogers has made the very important if
not cynical comments that as Central Bankers control the data, they could just
put in any figure and print several hundred billion more dollars. He basically
states all government data is manipulated anyway and this is no real departure
from the current situation.
Being Objective
So far the theory of the above events being linked is based more on
conspiracy than fact. This is not to belittle the events themselves but to try
to maintain a perspective. At present there is a lack of a euro-denominated oil
pricing standard, a petro-euro system is not impossible due to the large EU
imports but at present there is no recognized standard. You can also buy oil
using euros from any major bank should you wish to avoid holding the US dollar.
The seller also has the ability to convert the proceeds of sale to any other
currency; there is no compulsion to maintain your exposure to dollars.
Furthermore, whilst not denying the significance of oil we have to consider if
it is America’s only source of influence? The benefits of seignorage (the dollar
costs almost nothing to print but can be used by the government to buy goods and
services) to the US are between US$15-50 billion per year suggesting that it is
not really that significant and America has greater sources of influence.
To view the Iranian bourse as a significant threat we have to also assume that
they have the ability to produce and deliver significant quantities; this
remains unquantifiable at present.
Whilst the US has structural problems it’s unlikely that the euro will replace
the dollar as the reserve currency until European growth outstrips that of the
US. If we look purely at economic data, nobody is predicting the downfall of the
US, the Iranian bourse has been mooted since back in 2004 and the decision
regarding M3 figures was announced in November 2005 so both events should have
been factored into 2006 expectations.
Growth in the US is predicted to slow to 3.25% from 3.5% last year on the basis
of a slowing house market (the basis for strong consumer spending) and monetary
policy is expected to tighten slightly. Key signs of derailment such as
volatility on options on US stock market futures, credit risk spreads or US junk
bonds and risk free treasury bonds are near all time lows. So nothing from the
economic data we can actually analyse presents a huge concern for the US’s
outlook for the year.
The MBMG International Perspective
We have not been a huge supporter of the US in recent years and the
basis of our thoughts and opinions going forward is that investors should
continue to look to the East not the West. Our portfolios are heavily weighted
towards Japan, Asia and resources currently in support of our strategy. These
views are long held views and are not prompted by recent or anticipated events.
Whilst economists are not predicting any form of watershed in the US we have
concerns regarding the inherent weaknesses, declining economic growth,
increasing debt, rising interest rates to stave off inflationary issues and the
slowing of consumer spending as the housing market slows.
We would potentially also argue when it comes to the collapse of the dollar that
there is scope over coming decades for a gradual loss of faith in all paper
based currencies, the importance of oil and gold also starts to predicate this
theory. This, however, is an inflationary effect often experienced by tangible
assets and inflationary/deflationary outcomes will be determined by how central
banks react at the time to events.
None of these issues spell doom and gloom but our commitment is to invest where
we can make gains for our clients and when we compare this to the upside that
can be derived from the East we believe we can add value to portfolios by
limiting our exposure to the US. Our theory regarding the East is based on an
ambitious population of people with rapidly improving skillsets and when
compared to western standards their skills are acquired cheaply. The historical
barriers to trade, such as tariffs and language difficulties, are becoming less
of an issue and communications are becoming cheaper. The advantage of the MBMG
approach is that we are not constrained by benchmarks and therefore can adapt
our asset allocation according to our views on markets making it the ideal core
holding for a balanced portfolio.
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The above data and research was compiled from sources believed to be
reliable. However, neither MBMG International Ltd nor its officers can accept
any liability for any errors or omissions in the above article nor bear any
responsibility for any losses achieved as a result of any actions taken or not
taken as a consequence of reading the above article. For more information please
contact Graham Macdonald on [email protected]
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Snap Shots: Can Auto-Focus (AF) go wrong?
by Harry Flashman
 As
you get older, you may find that your shots can be less sharp. The
vision problems associated with aging may be the culprit. Answer? Go to
an Auto-Focus camera system.
When you buy your first Auto-Focus (AF) camera you are then quite sure
that all your shots will be pin-sharp from then on. It comes as a great
shock however, when you find you can have even more out of focus shots
than you ever had before!
There are unfortunately many situations where the magic eye and its
camera’s brain just cannot work properly. If there is no contrast in the
scene, then the AF will not work. If you are trying to focus in a “low
light” situation then the AF will “hunt” constantly looking for a bright
area. When trying to shoot through glass or wire mesh the AF can become
totally confused. No, while AF may be a great new development, it still
is not 100 percent foolproof.
One of the reasons for this is quite simple. The camera’s magic eye
doesn’t know exactly what subject(s) you want to be in focus and picked
the wrong one! You see, the focussing area for the AF system is a small
circle in the middle of the viewfinder, so if you are taking a picture
of two people two meters away, the camera may just focus on the trees it
can see between your two subjects. Those trees are two km away, so you
get back a print with the background sharp and the two people in the
foreground as soft fuzzy blobs.
This can be overcome, once you know how to handle an AF camera. What you
have to do is use the “hold-focus” (sometimes called “focus lock”)
facility in your camera (and 99 percent of all AF cameras have it)! To
use this facility, compose the people the way you want them, but then
turn the camera so that one person is now directly in the middle of the
viewfinder. Gently push the shutter release half way down and the AF
will “fix” on the person. Generally you will get a “beep” or a green
light in the viewfinder to let you know that the camera has fixed its
focus. It will now hold that focus until you either fully depress the
shutter release, or you take your finger off the button. Keeping your
finger on the button, now recompose the picture in the viewfinder and
shoot. The people are now in focus, and the background soft and fuzzy,
instead of the other way round.
So what should you do in the other situations when the AF is in trouble?
Simple answer is to turn it off, and focus manually! Sometimes,
particularly in the poor light situation, it is possible to shine a
torch on the subject, get the AF fixed on the subject and then turn off
your torch and go from there. But this is only when you cannot turn off
the AF!
Another focussing problem is when photographing a moving subject. When
say, for example, you are attempting to shoot a subject coming rapidly
towards you, the AF is unable to “keep up” with the constantly moving
target. The answer here is to manually focus at the point where you want
to get the photograph and then wait for the subject to reach that point.
As it gets level with the predetermined point, trip the shutter and you
have it. A sharply focussed action photograph.
Another super tip from the photographic studios of the glamour
photographers – when making a portrait shot, focus on the eyes, nowhere
else. I know it is easier to focus on the collar for example, but you
run the risk of the shot going “soft” around the eyes. Very, very
carefully focus on the eyelid margins and you will have a super shot, no
matter how shallow your depth of field may be. David Bailey and all that
lot - move over!
Finally, look at this week’s photograph with this article. The main
subject is in the right hand side of the picture. If the photographer
had not used the “focus lock” facility, this shot would have been
ruined.
Modern Medicine: The Trials of Trekking
by Dr. Iain Corness, Consultant
Quite a number of my friends, over the years, have gone
trekking. I have not. To be perfectly frank, I have no idea why people go
trekking, but for some it has become a sort of annual pilgrimage, the
jungles of South East Asia being the lure for the boots and back-pack set.
The leeches can almost set their clocks by them.
However, like all pursuits undertaken when one leaves the relative safety of
home, there are certain precautions that should be taken by those thinking
of indulging in the odd jaunt through the jungles. In today’s parlance, this
is called being “proactive”, which is merely the buzz word for what we all
used to call forward planning or even thinking ahead.
So what would I recommend for the trekker in today’s troubled world, other
than don’t go? Well, to start with, there are some vaccinations that should
be done, with the two Hepatitis vaccines for Hep A and Hep B being high on
the list. Another is Typhoid vaccine, which though not a 100 percent cover,
is better than none. You can also get this vaccine in liquid form. Joy oh
joy, no nasty needles!
The usual cover for polio and tetanus should also be brought up to date, as
many people tend to let these slip. How long is it since you had a booster.
Too long, I’ll wager.
The next couple are also, in my mind, very necessary. The first is Rabies –
I have no idea what the prevalence of Rabies is in Nepal – but I would
imagine it is not much different from other places in Asia. On a relative
scale, being caught up in Maoist uprisings probably is more likely that dog
bites – but that’s the risks you take. (Mind you, Rabies is also not one
disease you want to get, because otherwise you do not trek home – you come
back neatly encased in a wooden box.)
The second is Meningococcal vaccine to protect against a group of very nasty
bugs. Unfortunately, Nepal has had outbreaks of Meningococcal disease as
well as domestic unrest, and it is quite contagious in the closely packed
groups of back packers. Vaccination is painless and side effects are
generally mild. Protection lasts up to three years. You have been warned.
Of course, when considering trudging along the hot and steamy jungles, you
also have to remember that this is a high fluid loss pursuit, so you need to
remain well hydrated. Additional water supplies should be taken with you –
jungle streams, if you find one, may not have safe drinking water.
There are also the problems of snakes, scorpions, vermin and leeches, to
name but a few of the beasties and creepy crawlies that delight on feasting
off the itinerant back-packer. Long trousers, long sleeves and stout boots
are a necessity.
Of course, to really get involved in trekking, you should also remember that
you must be of reasonable fitness to begin with. If you are an overweight
cigarette smoking 50 year old, then don’t bother signing up the trek of a
lifetime. It would be your last (so possibly it would be the trek of your
lifetime)!
No, while I am aware that the jungle trekking adventure does appeal to many
– just remember that the trekking diseases may not be quite so appealing.
Sensible precautions, vaccinations and a health check before you sign on the
dotted line are really in order. Now, where did I leave my hiking boots?
Probably in the packing case along with my Frisbees, yo-yo’s, hula hoops and
other articles no longer required!
 Heart to Heart with Hillary
Dear Hillary,
I just had to reply to the letters from Willy and Ginger in the paper two
weeks ago. I am a 75 year old man from New Zealand and I have been visiting
Pattaya for the last 10 years since I retired. My wife passed away in 1993.
I might look to you a joke, but to me I’m the one who is laughing. Where
would I be able to find a pretty young girl interested in me in any western
country? OK course it costs me, but why worry, you can’t take it with you.
Viagra has been my friend, before I had to take depression tablets, but now
I have something to look forward to every year for a month. Now to Willy – a
75 year old woman (closer to my age) does not appeal to me, sorry. Now
Hillary, I would like to say to these silly old men that harm themselves
over their girlfriends leaving them, “Understand one thing. You never lose
your girlfriend – you just lose your turn.” Your weekly say is just great.
Keep it up.
Graeme, NZ
Dear Graeme,
Just where do I start, my Petal? Thank you for the kind words about the
column, and I do try to “keep it up”, but then of course I don’t need your
friend Mr. Viagra, the way you might do, to do this! I am also pleased to
see that you don’t need “depression” tablets any more, seems like the
‘uppers’ are canceling out the ‘downers’ so to speak. So you admit you have
to buy your companionship, but I agree with you in that you can’t take it
with you, (that’s why I have decided I’m not going)! Pattaya has been
described as Disneyland for adults, only the rides are better! The danger
comes in people such as yourself believing that Disneyland is real. It
isn’t. However, Graeme, I would say you have got a very healthy grasp on
life. Enjoy your retirement, and you too, “keep it up”.
Dear Hillary,
I know that just about everybody seems to be writing in to you with women
problems, but that’s not me. I’m happy every time I come over the Thailand,
except for one thing. Why do the shops open so late. I generally have my
evenings taken up with enjoying myself and the fun any you can get so
easily. But in the mornings when I have time to do the shopping for friends
back home, the shops are all shut. This is making it difficult for me to get
the souvenirs that everybody wants when you get home again. Any ideas?
Souvenir Sam
Dear Souvenir Sam,
First off, congratulations on being able to spell souvenir. Most people get
it wrong, so you don’t need to buy a dictionary to keep your spelling skills
up to date. Well done, Petal. So you have noticed that the shops open later
than they do in the western world, how observant of you! You would then have
also noted that the shops stay open more than a little longer than they do
in the west, and they are open on Saturdays and then again on Sundays. Some
of the supermarkets also open early (for Thailand anyway) at around 10 a.m.
However, I do have the answer for you. Do all the shopping for trinkets at
the airport. There are plenty on offer, and even though they might be a tad
more expensive, then at least you can get it all done while waiting for the
plane.
Dear Hillary,
A lot of people are wary of girls who work in bars, but my girl friend’s
family buffalo is in good health. Both of her parents are healthy too. She
has no brothers and sisters and her grandparents are all passed on. She is
the most beautiful girl I have ever seen, tall with a wonderful figure and
never gets “bitchy”. She also does not have any children living with her or
with her mother. Am I lucky or what? I am thinking about asking her to move
in with me.
Lucky Lucky Lucky
Dear Lucky Lucky Lucky,
Hillary is absolutely thrilled for you my Petal, but would caution you to
stop drinking whatever it is that you have been imbibing recently. You are
having delusions, my boy. The girl you describe does not exist. Get a vet’s
report on the buffalo before going any further. I would also strongly
suggest some chromosome testing or DNA sampling, just to see if this lack of
children is genetic or good luck or good management! Does she wear a scarf
around her neck and have a deep voice?
Dear Hillary,
Like many people in Pattaya I am tired of fighting with baht bus (song taew)
drivers over fares, especially at night. Is there any alternative other than
motorbike taxis?
Bill the baht bus basher
Dear Bill (the baht bus basher),
There are many alternatives. One is to catch a meter taxi. Another
alternative is walking. However, you could always buy your own baht bus. In
the meantime buy hiking boots. Go to places close to your home or hotel,
stay away from dark side streets.
Beyond the Beach: “A class above”
Caspian Pike
Well it’s back to earth this week on “Beyond the Beach”. Having spent the last
two shows “In search of real England,” exploring the nooks and crannies of the
Cotswolds (often hilariously), Andrew Watson comes home to Pattaya this week as
he takes in a little bit of life with Ranjith Chandrasiri, Deputy General
Manager of the Royal Cliff Beach Resort.
Andrew
meets Ranjith Chandrasiri, a man with an eye for excellence and a passion
for wines.
I’ve noticed that at least two things tend to happen a lot in this series and
its predecessor, “Perspectives”. First, Watson seems to spend a lot of time by
the sea, where it appears that he is consummately contented. And why not? For
those of us privileged to be able to spend a good percentage of our lives here,
perhaps it’s easy to take it for granted. Not so in “Beyond the Beach”. It’s as
if Andrew cannot believe his good fortune and he just wants to savour every
moment of glorious sunshine. Second, he seems to keep coming back to the Royal
Cliff Beach Resort, which as anybody who has spent any time there will testify,
must be simply tremendous. Opened in 1974 and extensively renovated in 2001, the
Royal Cliff is synonymous with quality and in many ways has become the jewel of
the Eastern Seaboard, a symbol of Pattaya’s growing reputation as a world class
tourist destination. But as champions around the world know, it’s one thing
getting to the top, quite another staying there.
It’s part of Ranjith Chandrasiri’s brief to keep the Royal Cliff, a “class
above”. Elegant, suave and a splendidly sartorial individual, Ranjith takes
Andrew on something of a mini-tour of the resort, pausing to chat about myriad
aspects of what makes a great hotel complex; infrastructure, facilities, food.
With typical chutzpah, Andrew suggests that if you really wanted to find out
about a restaurant you should look at the kitchens. So they check out one of the
Royal Cliff’s! From deep in the bowels of the Resort, Andrew throws in a serious
question about Ranjith’s management style; after all, it must be something of a
juggling act, keeping the whole show running so smoothly. Honesty and integrity
are a couple of essential ingredients, Andrew suggests; “it’s all to do with
people”. It was a nice touch, actually.
The show then moves to a rather plush suite, (typical Watson again) with the
most sensational panoramic views north over Pattaya and southwest to Koh Larn.
In this eminently relaxing environment, Andrew gets to know the man behind the
job. Ranjith is from Sri Lanka and he’s come a long way, literally and
metaphorically. You can imagine that the tsunami was something of a double
whammy for him and his family. On the other hand, it becomes clear that Pattaya
provides everything that a person could wish for and Ranjith talks with great
enthusiasm about one of his great passions; wine tasting. He’s President of the
Wine Club and regularly judges at International wine competitions (now that
sounds like a great job!). Perhaps inevitably, the show ends in the Royal
Cliff’s sensational wine cellar, over a bottle of house bubbly. It’s another
cracking effort by the PMTV team.
Next week, I’ll be previewing “Beyond the Beach” when Andrew Watson is on his
travels again, this time to New York City, where he’ll be investigating with
characteristic swank, whether the Americans and the English are truly, “Divided
by a common language.”
Catch Andrew Watson’s interview with Ranjith Chandrasiri, Deputy General Manager
of the Royal Cliff Beach Resort, “A Class Above”, Sunday, at the following
times:
Sophon at 8:00am - Midday - 4:00pm - 8:pm and Midnight.
Chonburi at 9:40am - 2:00pm - 8:40pm and 40 minutes after midnight.
Jomtien at 9:00am - 12:30pm - and 9:00pm
Sattahip at 8:00am - 1:30pm - 5:00pm - 8:00pm and 11:00pm
A Female Perspective: Don’t Sweat the Small Stuff!
with Sharona Watson
About last November time, I noticed that my husband was reacting with
calmness to the slings and arrows of outrageous fortune. Whereas previously
he would occasionally allow himself to become upset by people whose
behaviour seemed to be immoral and ethical and sometimes illegal, suddenly
he was taking it all in his stride. Where once he would bang on and on about
how ignorance and prejudice is like a disease, a virus that infects people,
now he was just shrugging his shoulders and repeating whenever an occasion
arose, “Don’t sweat the small stuff, because it’s all small stuff.” After a
few times of hearing this, I wondered (with some concern) whether he had
stopped caring about important issues. Maybe, I thought, the latest attempt
to diminish him had finally knocked him down? But he seemed to be smiling a
lot more, despite everything. I couldn’t work it out. Then one evening, when
for once we were able to read in bed and were not completely exhausted, I
noticed the book he was reading; it was “Don’t Sweat the Small Stuff, and
it’s All Small Stuff” by Richard Carlson.
A view to make anybody feel calm.
At this time, my husband was working ridiculously hard. I mean, ridiculous.
In school all day, then off to film, writing his column “Learn to Live to
Learn” for the paper (it’s coming back soon!), doing his own academic
research. I hardly ever saw him! (I know what you’re thinking!) So I asked
Andy what the book was about. “It’s about a hundred and fifty pages” came
the facetious response. Funny. Of course, I have developed quite a few ways
of inflicting immediate pain on my husband if he gets too cheeky, so it
wasn’t long before he was happily telling me all about the book, a series of
simple ways to keep the “little things from overtaking your life”. And
little people, of course, as well. I count myself lucky to have learned when
very young, that it really is a ‘small’ person who premeditatedly diminishes
another. Which means that it all becomes just a way of dealing with
something, that matters. A choice you are able to make. The more I heard
about Carlson’s book, the more I liked what I was hearing. Chapter seven;
“Don’t interrupt others or…” “…finish their sentences for them” said Andy,
finishing my sentence for me. Chapter twenty-six, “Set aside quiet time,
every day.” Ah! So that’s why I keep finding him in the top room, watching
the sea! Mind you, it’s a room with a view to make anybody feel calm inside.
I have to admit that if there’s something Andy’s reading that I want to
read, it’s more than likely that it’s going to end up on my side of the bed.
I’m afraid that’s how it ended up in this case. But, as I said to Andy,
“Remember chapter seventeen and “Surrender to the fact that life isn’t
fair!”” Which is kind of the point of the book in many ways. So many people
seem to be rushing everywhere at such a speed, blaming others, being greedy,
lying, doing negative things, when the truth is, they don’t have to!
There’s a chapter in the book called, “If someone throws you the ball, you
don’t have to catch it”. I suppose this is the kind of statement that sends
shivers down the spines of both bureaucratic imbeciles and bullying bosses.
For example, we bring our children up to question what they are being told.
As long as they show respect when they do this, I think it is an incredibly
positive thing to do. They learn to think for themselves. And the bottom
line is, “no!” You don’t have to catch the ball! Richard Carlson relates
this statement to people’s tendency to “jump on board” somebody else’s
problem, when they really don’t have the time or energy and often the
expertise to help. They can’t just say “no”. The same applies when someone
throws an insult at you or criticises you. You can choose to catch the
insult and feel injured, or you can drop it and just get on with your life.
There’s a story which we first heard from a genius of a man in Jerusalem,
who never did “sweat the small stuff,” which reflects the same approach to
dealing with the less pleasant parts of life. It’s a story that I think is
worth reminding yourself of on a regular basis:
“One day, the Buddha was sitting under a tree, contemplating the simple
beauty of the world, when an angry young man approached him, ranting and
raving about an incident in his private life. The Buddha looked at the angry
young man and listened but did not react. Then, during a moment when the
angry young man had paused for breath, the Buddha said, “Angry young man,
may I ask you a question?” The angry young man was momentarily perplexed by
this but answered, (angrily) “Yes I suppose so, if you must!” The Buddha
continued, “If I were to offer you a gift and you were to refuse to accept
the gift, then to whom would the gift belong?” The angry young man was
forced to consider this question, but was still angry when he shouted his
reply, “It would still be yours of course!” The Buddha smiled
compassionately at the angry man as he rose and said, “Yes, you are right.
And so it is with your anger. I refuse to accept the gift of your anger and
so it will remain your own.” And the Buddha turned and walked quietly away.”
I suppose it’s fair to say that there are quite a few of these ‘feel better
books’ around. “Don’t Sweat the Small Stuff” has a bit of a cult following.
It’s quite ‘Buddhist’ in lots of ways and it leaves a warm happy feeling
inside of you. Chapter sixty nine is entitled, “Be happy where you are”. As
I read this chapter, I looked across to my husband who had fallen asleep
with a smile on his face. The sea had calmed and was washing gently on the
shore. Other than the waves, it was completely quiet. And I understood why I
needn’t worry about the small stuff; because “it’s all small stuff” .
Next week: Visiting the Past
[email protected]
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