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Money matters:
Graham Macdonald MBMG International Ltd.
Where in the world?
A well know magazine recently interviewed MBMG about how the
recent political turmoil here in Thailand, coupled with the rollercoaster ride
being experienced by the banks and economies around the world, is causing
widespread concern about the security of investments. In Thailand, concerns were
prompted by a combination of the political situation and the recent passage of
the Institutes of Deposits Protection Act (IDP). In simple terms, as stated in a
recent Money Matters column, this Act places a cap, or limit, on the
amount of protection bank deposits in Thailand will receive. Under this Act, the
maximum amount that the IDP will guarantee per depositor per financial
institution is one million baht. In the article we reviewed the range of viable
alternatives in Thailand, including money market funds, deposit funds, overnight
funds and fixed deposit funds in different jurisdictions around the world.
However, this has also prompted us to review the various investment and deposit
markets around the world. At the time of writing, we are waiting for the US to
approve or not the Paulson request for US$700 billion and so things may be
different in the short term by the time you are reading this. Nevertheless,
below we have summarized the issues facing investors and depositors and indeed
everyone right now:
Africa - The Dark Continent is coming increasingly under the investment
spotlight with the increasing focus on MENA (Middle East and North Africa)
funds. However, this appears to be driven more by marketing momentum than
fundamental economic factors and we would be very wary about all forms of
investment in Africa now although commodities and resources are likely to remain
attractive and this may ensure that Chinese direct investment into Africa
continues.
Summary - African currencies, property and equities right now look too
specialized for most investors.
Asia - See below for information regarding specific markets. Investor
protection is patchy throughout the region varying dramatically from country to
country, as indeed does the quality of financial institutions. Property in Asia
is, in general terms, in much better shape than in the West although in many
cases we would defer buying opportunities for the short term. Many of the
region’s currencies that aren’t completely US$ linked appear to be in reasonable
shape.
Summary - We would not rush in right now but, generally, we would not panic
either.
Australia - The worst is yet to come for the Australian economy, property
markets, equity markets and financial institutions. Finance companies are
falling like flies after a DDT dusting and we expect the Australian banking
system to come under pressure too. The AUD remains extremely vulnerable as a
result, especially against a backdrop of falling interest rates.
Summary - it’s not too late to exit Aussie assets and it makes sense to
move money away from ‘down under’.
China - The world’s most populous nation’s inevitable progress to
becoming the world’s largest economy has been cemented by the arrival of 3
Chinese banks in the list of the world’s 5 largest banking institutions. We
think that the stock market has further to fall, that the property market is
entering a major correction and that a recession is on the cards. That said, we
also think that China is not excessively leveraged, has huge foreign currency
reserves and a hugely resourceful and resilient population.
Summary - It is hard to know how clean China’s banks are so we would
avoid keeping money in China and we would be waiting for better opportunities to
invest into Chinese equities and property. RMB may not be the best performing
currency over the coming 12 months but it will not be the worst either.
Europe - The Euro zone is battling against recessionary forces and some
European countries are now openly in recession. The economic pain will be at its
worse in leveraged countries such as Ireland or Spain and this is where property
and equity corrections will likely be at their most serious. The euro is not as
beset with problems as the likes of sterling or AUD but looks expensive and may
weaken to some extent. Some European banks may get caught up in the fallout of
the sub-prime crisis but overall the European banking system is in far better
shape than the US or the UK.
Summary - It is too early to buy European equities just yet, property in
Ireland and Spain looks set to fall much further and this now more neutral than
positive.
Harvard & Yale - the endowments of these institutions have operated the
most successful investment strategies of the last two decades. They continue to
go from strength to strength. The main focus of these strategies is to reduce
risk and to achieve greater consistency of investment returns resulting in
higher gains over the business cycle. MBMG’s client portfolios, managed by Midas
Capital (nee MitonOptimal), aim to replicate this philosophy and approach and
continue to generate good returns for clients in a range of currencies.
Summary - Despite the global economic woes of present, clients have still
made money, are making money and will continue to make money whatever the
markets throw at them.
Middle East - Strong oil revenues have created a wall of Arab money, as
evidenced by the spending power of the region’s sovereign wealth funds. However,
we remain very sceptical about the investment and business capabilities of the
region.
Summary - Arab currencies, property and equities right now look too
volatile and insufficiently attractive for most investors on a risk/reward
basis.
New Zealand - Plunging property market, collapsing finance companies,
banks under pressure, equity markets locked into a downward spiral. There may be
good reasons for keeping money in New Zealand but all the ones that we can think
of are related to the attractive returns from agricultural investments right
now.
Summary - Get out while you can!
Offshore - Regulated respectable offshore centers will profit from the
added security that they provide. Those with less stringent protections may
experience chickens coming home to roost. We have long preferred keeping money
in deposit or investment funds in Guernsey, a self-governing UK dependency since
1204, whose financial regulation and law enforcement standards were strongly
commended by the International Monetary Fund which found a strong level of
compliance with the highest international standards. The Guernsey Financial
Services Commission (GFSC) requires that at least 90 percent of assets be held
by a third party custodian to provide capital protection in the event of a
failure in the investment provider. This means that, if you choose to place your
money in a Guernsey-domiciled investment provider, at least 90 percent of your
money is protected even if your investment company folds completely.
Summary - A regulated deposit fund in Guernsey can be very different to
putting your money into, for instance, a bank in Thailand. If a Thai bank fails,
then you will become just one more name on a long list of creditors.
Singapore - The economy seems to be slowing and this would hurt the local
stock and property markets. However, the Singapore dollar’s status as the Swiss
franc of the East remains intact although we would prefer to hold our SGD
offshore rather than in one of the banks in the Lion City.
Summary - The currency may well be a beacon right now.
Thailand - Will the currency, the economy, the property market and the
local bourse improve if the political situation is resolved? Maybe, but when
will the political situation be resolved? Fundamentals remain attractive and,
therefore, there is high potential within the market.
Summary - Could go any way!
United Kingdom - The property market is in the throes of a major crash.
The equity market is in a tailspin, the pound remains very vulnerable, the
economy is on the verge of recession; things are looking desperate. Banks,
especially the smaller ones, are at significant risk of failure. The country’s
largest mortgage lender HBOS has been rescued by Lloyds-TSB but other
institutions like Bradford & Bingley remain extremely vulnerable.
Summary - Sell property and equities now! Take exposure to other
currencies; prefer offshore deposit funds to smaller onshore banks.
USA - What did we say about the UK? - The property market is in the
throes of a major crash. The equity market is in a tailspin, the dollar remains
very vulnerable, the economy is on the verge of recession; things are looking
desperate. All banks and financial institutions are at extremely significant
risk of failure. Money held within portfolios at investment banks is generally
safe as the banks only act as custodians. However, the size of US institutions
may mean that the process of transferring investors’ securities even from Lehman
Brothers, which certainly was not the largest institution, may take some time.
We believe that it is more secure and more re-assuring to hold assets outside
the US right now.
Summary - Sell property and equities now! Take exposure to other
currencies, prefer offshore deposit funds to smaller onshore banks.
Zimbabwe - Recently introduced the $100 billion banknote. Sadly, it’s
worth just 80 cents. Maybe Zimbabwe exists to prove that things actually can be
even worse than in the UK and USA.
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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]@mbmg-international.com.com
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Snap Shots: by Harry Flashman
How not to miss good shots
 How
many times have you thought to yourself, “Damn! I wish I had the camera
right now!” This is after the shot of a lifetime just happened before
your eyes. A shot that could have kept you in champagne for the next
three months.
Now these shots do not have to be re-runs of the Towering Inferno, but
can be shots that just somehow epitomize life in Thailand, for example.
It could be a katoey posturing on Beach Road, or even the buffalo with
two birds standing on its neck, like the shot I have used for this week.
Always remember that you are living in a land that your countrymen save
up for 12 months just to get here for a holiday. You (we) are lucky and
should not let photographic opportunities pass us by.
So this week, let’s look at a few specific examples of “how to” when you
are looking to record those “once in a lifetime” images.
Every city, town or village anywhere has its parades. And there are
plenty of them here. Now, have you ever tried to record the parade? It
is actually very difficult. The naked eye sees a long procession of
musicians, marchers and the like as they pass by, but the camera sees
only one slice of the action about 1/60th of a second long!
There is only one secret word for parades, and that’s ‘height’. You have
to get a high viewpoint to successfully record the action, and
preferably use a long lens. By shooting down the oncoming procession you
will get several squads of musicians, marchers, etc., all on the one
frame. By using the telephoto lens you “compress” the action and get
more in the one photographic frame. Honestly, if you can’t get up high
don’t take parades. You will be disappointed with all ground level
shots.
All tourist towns have their nightlife, and we have the odd nocturnal
events and places. Lots of lights, neon signs and flood-lit fountains
are the norm for this type of photograph. The secret here is a wide
angle lens with an aperture down around f 1.8. This is the time to set
your digital to 800 ASA, or 400 ASA at least. The other secret is not to
use your flash. Now I fully realize that this is photography after dark,
but the whole concept is to let the attractions provide the
illumination, rather than blasting it with your flash burst. If you try
and take neon light using flash you will totally wash out the neon and
again get very disappointing results.
One of the more challenging travel situations is the summer beach
holiday. It is very difficult to photograph the beach and not end up
with a washed out look in the final photographs. The secret here is a
polarizing filter and the time of day you shoot. This is where the
polarizer works so well, especially with the glare from the sand. The
polarizer will also give you a blue sky to contrast the yellow sand. The
time of day is also just as important. Shoot early morning or late
afternoon when the sun’s rays are skimming across the beach and the
tracks and ridges in the sand will show up as shadows.
Some of you will be exponents of the wilderness type holiday, trekking
and camping and taking in the vast grandeur of breathtaking natural
wonders. The secret here is a wide angle lens, look for low viewpoints
and set the ASA on 50 or 100, plus a tripod if you can. The idea here is
to use the lens at around f16 or f22 to maximize the depth of field.
This in turn and the slow ASA setting, will require longer exposures -
hence the tripod. Shooting in this way will give you maximum detail in
the shot, maximum content and visual theater. Finally, shoot early
morning or late afternoon as well to get the dramatic shadow effects and
really give the impact to the Grand Canyon! With charging elephants,
however, do not wait to see the whites of their eyes; however, they do
look better when polarized!
Modern Medicine:
by Dr. Iain Corness, Consultant
Can you get a DVT in Business Class?
Let’s clear up the acronyms first. DVT stands for Deep Venous
Thrombosis, which manifests itself as blood clots, generally in your lower
legs. And secondly, you don’t have to fly to get a DVT.
Now everyone in the world, other than a few farmers in outer Mongolia, has
heard of the “Economy Class Syndrome”, in which you end up getting blood
clots in the legs from being squeezed into seat 176A at the rear of the
Economy section of Plummet Airlines. The rationale is that after sitting in
176A for the 12 hour flight to bring the bad news to Outer Mongolia, the
blood flow in the legs slows so much that clotting forms and you end up with
yet another acronym, this time called DVT, or more correctly Deep Vein
Thrombosis, or even Deep Venous Thrombosis. This has produced a group of
nervous airline passengers, cowering in fear, waiting for hijacking or DVTs.
Those who can afford it, upgrade to Business class and sit there drinking
G&T’s feeling totally pampered and safe from DVT. Unfortunately, you can get
a DVT while sitting with the aforementioned G&T in seat 12A as well.
However, there are many ways of getting your DVT, and you don’t have to buy
an expensive ticket, plus fuel surcharge to get one. You can get one sitting
in front of your work computer. Dear me, your computer is now a killer.
Backing up this contentious claim is one of the world’s respected medical
publications, the New Zealand Medical Journal, with the results tabled at
the annual conference of the Thoracic Society of Australia and New Zealand.
Professor Richard Beasley of the Medical Research Institute in New Zealand
studied patients admitted to hospital with DVTs and found that only 21
percent had traveled on long distance flights, whilst 34 percent were
sedentary office workers who would sit in front of their computer screen for
three to four hours at a stretch without getting up, and do this for up to
14 hours a day. This showed two factors. Firstly their work habit was
dangerous, allowing the blood to pool up in their legs, and secondly, they
had magnificent bladder control.
Whilst I was joking about the bladder control, I would postulate that to be
able to sit for four hours at a time, these office workers were not drinking
enough fluid, leading to thickening of the blood, and even more likelihood
of blood clots. Look around your office, how many of the staff have a water
jug, or even a glass of water on their work station?
That’s enough on the factors leading to DVT, what can a DVT do? What happens
is very understandable. The clot breaks off from the deep vein and then
travels upwards towards the heart. In doing so, it will go from major, large
diameter blood vessels into smaller and smaller again. Eventually, depending
upon the size, the clot will become wedged in a very small vessel and shut
off the blood supply to that area.
If the blockage occurs in the lung, the condition is called a Pulmonary
Embolism (PE). This is potentially fatal. PE causes or contributes to up to
200,000 deaths annually in the United States. One in every 100 patients who
develop DVT die due to pulmonary embolism.
There is some good news in all this, if pulmonary embolism can be diagnosed
early and appropriate therapy started, the mortality can be reduced from
approximately 30 percent to less than 10 percent.
Still, 10 percent is a little too high for my liking. So what can you do to
prevent getting a DVT? Apart from the obvious maintenance of good health
with sensible eating and drinking and regular check-ups, the important
preventive factors include getting up and walking around at least every hour
(both in the office and from seat 176A), drinking plenty of water and taking
100 mg of aspirin every day. By making it less likely that a clot can form,
you remove the dangers of DVT.
Go and get a glass of water now! And use it to swallow your aspirin.
 Heart to Heart with Hillary
Dear Hilary (sic),
Perusing several recent editions, I came across two writers keen to know what is
your true appearance, having only seen the odd drawing of you which could have
been mine, sketched from photo’s taken by most ardent admirer, Nairod Remraf.
Why sketched, because Nairod’s camera, a box brownie which he’s used since
serving in the Boer War, needs expensive serving, its images so poor, in need of
enchantment by cartoonist me? So, back to your appearance and why you’re rarely
seen? Your modesty prevents you from saying that you have it all! And to be seen
and adored in public would have the world media descending on Pattaya and giving
your modest self, unwanted attention. Re the photos? One of them featuring the
back of your shapely legs was quite good and would have been even better had the
Big C security chap not apprehended Nairod for prostrating himself on the
escalator, the photo being later confiscated by the court. His welfare these
days I hear you ask? Well, he’s recovering well after taking up your suggestion
to pitch his tent on the Sukhumvit, so very soon, he’ll be refocusing on your
sweet self again; and my advice to you is to wear trousers when negotiating
escalators!
Dorian farmer
PS: so that you don’t think Nairod too old for you, he says that he lied about
his age to serve in the Boer War.
Dear Dorian (and in a roundabout way, your alter ego Nairod),
Photos of me going up the Big C escalators? Taken with a box brownie? You must
be mistaken, Mr. Cartoonist. Hillary (two ‘ells’, by the way my Petal) does not
go up Big C escalators. In fact, I do not go up any escalators. I have no head
for heights and the last thing I need in this life is to swoon into the arms of
your lecherous friend. No, when needing to go to upper floors, I always take the
lift, as befits a woman in my position.
I am not sure your friend really understood what I meant about pitching his tent
on Sukhumvit Road. I neither meant the footpath, nor the median strip, but
somewhere around the center lane outbound would be fine. If he pitches the tent
close to the hospital, the ambulance charges should not be too difficult for him
to scrape together (after they’ve scraped him off the road). When you say he is
“recovering well”, is this from the after effects of being run over? (I don’t
think I’m that lucky!) Or is it just from the vodka?
Honestly Dorian, I don’t think that your alter ego is the man for me. I don’t
give a purple damn how old he is. Thank you for telling me that my legs look
nice. I don’t do anything special to keep them that way. Not that I’m really
interested, but are there any copies of the photographs left?
Dear Hillary,
This is not a lovelorn problem, so I hope you don’t mind my taking up your time
with this, but it is one that nobody has been able to answer, so I thought, as
you are the fountain of facts, you just might know. I notice that there appears
to be more and more hill tribe people selling native trinkets in Thailand. They
just used to be in Chiang Mai down by the Anusarn market, but now they seem to
be everywhere, including Pattaya, which is certainly a long way from the Golden
Triangle. That makes me wonder if these traders are real hill tribe people, and
if they are, how did they get to Pattaya, and are they genuine and is it safe to
buy things from them?
Akha
Dear Akha,
Phew! You certainly have got your undies in a knot over the hill tribe folk,
haven’t you? How did they get away from Chiang Mai? Simple, my Petal, perhaps it
is the new cheap flights from Chiang Mai to Bangkok that is bringing them down
from the hills, as I have yet to see an Akha lady in the black jacket and skirt,
colored socks and funny hat with the back turned up, on a regular flight.
Why do they do this? It is a fine example of the Thai Free Trade Dam Agreements
(TFTDA), promoted heavily by the Thai government. If there is a market
somewhere, flood it! But what you have to remember is that every time you see a
man wearing a Hawaiian shirt, it does not mean that he is Hawaiian. Or every
time you see a very well endowed woman in a bikini, it does not mean that she is
a he. Likewise your genuine hill tribe ladies. If they are far from the beaten
track, it is highly probable they are genuine traders in black drag and funny
hats, but not genuine hill tribe traders. If I am found strangled in the morning
by a rope of silver coins, you will know I was wrong. They were genuine. Is it
safe to buy things from them? Totally safe, there have been no recorded cases of
bird flu passed on through chicken feather head-dresses.
Let’s go to the movies:
by Mark Gernpy
Now playing in Pattaya
Star Wars: The Clone Wars: US Animation/Sci-Fi – A new
adventure in the “Star Wars” series, here done with animation. The movie
has gotten generally negative reviews, most saying that the mechanical
animation and a less-than stellar script make The Clone Wars a pale
shadow of George Lucas’ once great franchise, and a cheap excuse for a
big-screen spectacle. It’s more like a long Saturday morning cartoon,
and a trailer for the upcoming new Star Wars series on TV. Parents may
be perturbed by the film’s relentless violence.
Disaster Movie: US Comedy – Returning to their seemingly
bottomless well of flatulence humor, racial stereotypes, and stale pop
culture gags, Friedberg and Seltzer have produced what is arguably their
worst “Movie” yet. Seldom has a film been more appropriately titled.
Reviews: Extreme dislike or disgust.
Luang Pee Teng II / The Holy Man II: Thai Comedy – Bad boy
becomes monk, meets misadventures, makes merit. The first Luang Pee Teng
was the top Thai film at the box office in 2005, earning 141 million
baht, even beating out Tony Jaa in Tom Yum Goong. This second of the
series has a new star, Thai rapper, hip-hopper, and ex-skateboarder Joey
Boy, one of the Thai stars in the ill-advised and poorly-received rock
version of the Ramakien that played Lincoln Center in New York in the
summer of 2006. The cast is filled out by the usual contingent of Thai
TV comedians.
Eagle Eye: US Action/ Mystery/ Thriller – Shia LaBeouf and
Michelle Monaghan play two strangers thrown together by mysterious phone
calls from a woman they have never met. Threatening their lives and
their families, the phone calls push the two into a series of
increasingly dangerous situations using the technology of everyday life
to track and control their every move. As the situation escalates, these
two ordinary people become the country’s most wanted fugitives, who must
now work together to discover what is really happening. Fighting for
their lives, they become pawns of a faceless enemy who seems to have
limitless power to manipulate everything they do.
The script has the feel of something once substantive, but which was
poked, prodded, cut, and crimped until all semblance of intelligence was
wrung out of it. Apparently, it means to say something about
anti-terrorism surveillance and civil liberties, but most reviewers who
try to say what it’s about, say it’s about as dumb as can be. Mixed or
average reviews.
Dive!: Japan Drama – Three young men try to turn their dreams of
Olympic gold into a reality in this sports drama from Japan – and yes
there is a fairly sturdy story. The film spends a lot of time in and
around the pool photographing the skimpily clad boys as they practice
their diving. The three main young stars underwent diving training for
three months in order to more convincingly portray their characters
onscreen. Please understand that the film, whatever its pleasures may
be, is a Japanese film dubbed into Thai, and with no English subtitles;
nevertheless what’s going on is pretty clear.
Bangkok Dangerous: US Action/Drama – Directing twins Danny and
Oxide Pang return to remake their popular 1999 thriller about a ruthless
hitman (this time Nicolas Cage) who travels to Bangkok in order to carry
out four murders. During the course of his jobs, the triggerman falls in
love with a pretty local girl (Hong Kong actress and singer Charlie
Yeung) while also bonding with his young errand boy (nicely played by
Thai actor Shahkrit Yamnarm). A fairly decent but predictable
low-powered action flick, shot in some interesting locations in Bangkok.
For Nicolas Cage fans. Generally negative reviews.
You Don’t Mess with the Zohan: US Action/Comedy – Starring Adam
Sandler. Zohan is an Israeli commando who fakes his own death in order
to pursue his dream: becoming a hairstylist in New York. It’s an Adam
Sandler comedy, and if you like his kind of low crass comedy, you should
like this one. Here he plays the Israeli/Palestinian conflict for
laughs. I laughed. A lot. And cringed. A lot. Mixed or average reviews.
Baan Phee (Phop/Pob) 2008: Thai Horror/ Comedy – At least the
11th installment of this popular ghost/ horror/ comedy series. In Thai
with no English subtitles.
Mamma Mia!: US/UK/Germany Musical/ Romance – Immense quantities
of infectious ABBA music in an extraordinarily vivacious and energetic
musical that is bound and determined to make you sing and dance and feel
good about marriage. Mixed or average reviews.
Scheduled for Oct 9
E-Tim Tai Nae: Thai Action/Comedy – About a boxer performing
in a show in Pattaya who falls in love with a Japanese tourist. Looks
dreadful, unless you like comedy based on the smashing of testicles.
Body of Lies: US Drama – With Leonardo DiCaprio and Russell
Crowe, about a CIA operative who attempts to infiltrate the network of a
major terrorist leader operating out of Jordan.
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