- HEADLINES [click on headline to view story]:
Heart to Heart with Hillary
Let’s go to the movies
Graham Macdonald MBMG International Ltd.
Where do we go from here? Part 3
If you have suffered major losses in a serious economic
downturn, the relevant argument is to look at whether or not it is clearly
better to remain invested or not. The answers may surprise some readers.
There have been many periods when, having been hurt by the onset of a
downturn, it is better for investors to cut their losses rather than
remaining invested as per the primary indices.
The chart on this page shows this much better than I can
attempt to describe.
An investor would have been much better exiting the markets in 1900, 1929
and 1966 than remaining invested until the cycle lows of 1903, 1932 and
1975. In particular, let us focus on the most comparable previous major
downturns. An investor who decided to hold and wait for the recovery after
the market crash of 1929 (when the market fell around 35% from the peak to
the year end) would have incurred a further loss of 34% in 1930 and then
another loss of 53% in 1931. In fact, by the time the low was reached in
1932, an investor who stayed with the market would have seen the value of
$100,000 reduced to just $10,814. An investor who had simply exited the Dow
after the initial carnage of 1929 would have been almost SEVEN times better
off. Our analysis of the data since then shows that if the Dow falls in a
calendar year, there is a 38% chance that it will fall as well in the
following year and the average fall in such a year is in excess of 20%.
Generally, the odds of a rising year after a falling year are reasonable;
around three out of every five years following losing years tend to yield
gains. However, the losing years tend to be heavy losses. Specifically, in a
situation of the magnitude of the current crunch, precedent suggests that we
should expect three more years of pain to follow and that the losses of 2008
might be less than half way down to the bottom.
We would emphasise that every situation is different - we have never exactly
been here before and investment opinion is fiercely split as to what could
happen next. But to say that history would vindicate a passive holding
strategy at this point is completely misleading.
The cost of making the wrong choice at this time can be devastating - this
is not a short term problem. Again, let us look to history for guidance.
From 1900 to 1943, the Dow yielded an annual rate of return of just 2.3% per
year. In real terms, there has been a fifty year period when the Dow
returned less than 0.5% per year. In more recent times, from 1962 to 1982
the DJIA increased at a rate of just 2.4% per year. These are the dangers of
Now let’s look at the flip side of the coin. Without doubt, there are also
good times. Simple maths dictates that there is a 60% chance of making money
following a bad year. However, it is choosing where to go and what to do so
as to reduce your risk that makes the difference.
I would highlight there is still good money to be had. For
instance, distressed property funds and distressed corporate bonds - these
offer exceptional opportunities at clearly defined risks to the analytical
buyer at the right time. Gold still looks good as does the multi-asset class
approach. For those with a more adventurous outlook then Venture Capital and
Private Equity can offer good returns but the potential downside is big as
The biggest shake up in the global economic landscape since the onset of the
Great Depression has caused us to make a number of changes to our portfolios
and we anticipated this scenario … any portfolio that was not positioned for
these momentous events and yet still is not reacting is holding assets that
have no relation to the prevailing economic situation. We fail to see how
that can make any kind of sense from a risk-adjusted perspective. To our way
of thinking it makes no sense to do nothing when the world is changing so
quickly. Ostriches may bury their heads in the sand but good portfolio
managers remain vigilant at all times - never more so than now!
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
Snap Shots: by Harry Flashman
Painting with ‘dark’
first photographic studio was in a large building which had its own
theatre for marketing activities. Unfortunately the business that had
occupied the building went bankrupt, so there were no tenants, but I
knew the caretaker, and I scored the theatre area that could be used for
The theatre stage had all the lights you could imagine, footlights,
overhead lights, spots, flares, everything. It even had an enormous
sound system, so I could blow my ears off while setting up photographic
sets for the commercial photography I was doing at that time. With all
the theatre’s tungsten lighting, I used no flash, but compensated for
the color shift by using blue gels over the theatre lights. Actually I
had too much light, but it was all part of the learning curve.
My next studio was in a large waterfront building that had been a
warehouse. I rented an area and then I painted everything white. Floors,
doors, walls, windows. I had decided that I wanted to be able to use
small apertures, so I needed as much light as I could get. By this stage
I had also graduated to multiple flash units, so I had lighting that
would have brightened up the darkest days. I could shoot at f32 easily
with my Broncolor flash heads. There was only one problem. I could not
get sufficient shadow to produce a good 3D effect. I was getting flat 2D
pictures. I resorted to making huge flats (walls) which were painted
matt black to try and get some shadow. The results were better, but the
lighting was still not where I wanted it to be.
In the third studio, I used what I had learned from the first two and I
painted the entire studio black - floors, doors, walls and windows. Now
I could get good shadows, show form and even shoot mysterious images. I
called this stage in my photographic career ‘painting with dark’.
Dark shadows allow the viewer to imagine what is being hidden. Your
photograph “hints” at something and the viewer’s mind does the rest from
there. This is used to great effect in ‘glamour’ photography (as opposed
to pornography, by the way).
I found that it was much easier to begin with total darkness and then
add the lighting I wanted (or needed) to produce the effect. I could
gain complete control over the lighting, with no stray bouncing light to
complicate and confuse, as had been the problem with my white studio.
Look at the two shots this week, of the dark-skinned girl in the black
studio. In the first shot there are two light sources, a front light
with a square ‘softbox’ fitted (look at the reflections in the eyes) and
one hair light to the right rear.
Now look at the second shot, which had three light sources - a front
light and two hair lights from either side, producing a more stark shot
compared to the other moody dark shot. Even though there is some light
spill in both shots, there is no resulting extraneous lighting to dilute
the blackness. Painting with dark, I called it!
The third shot has three lights. A front light, a hair light and one
very strong light into the black background, causing it to ‘blow out’.
This shot is memorable because of the very sharp contrasts between light
Try to remember that darkness (shadow) can be even more important than
light at times.
by Dr. Iain Corness, Consultant
BPPV - A fearsome condition - or am I spinning you a yarn?
Benign Paroxysmal Positional Vertigo (BPPV) is a very common,
but very distressing condition. In it, you feel that the room spins around
you and you cannot stop it. Have you ever been so drunk that when you lie
down on the bed the spinning rotation is so bad you grip the edges of the
bed to stop falling off? That is what BPPV is like - but without the
The symptoms of BPPV include dizziness (vertigo), lightheadedness,
imbalance, and nausea. Activities that bring on symptoms will vary, but are
almost always produced by a rapid change of position of the head. Getting
out of bed or turning over in bed are common ‘problem’ motions. Because
people with BPPV often feel dizzy and unsteady when they tip their heads
back to look up, BPPV is sometimes called ‘top shelf vertigo.’ Women with
BPPV may find that being shampooed can bring on the symptoms too. It also
tends to be recurrent. So until you read further, don’t look up or get your
To understand BPPV, you have to understand the workings of your inner ear.
You have three semi-circular canals aligned in different directions, which
act like spirit levels (the builders type, not the three fingers on the
whiskey glass barman type) which have cells with fine hairs bathed with
fluid as your head moves in different directions. The movement of the fine
hairs sends electrical impulses to the brain to tell it (and you) which way
However, with BPPV, the natural movement inside the semi-circular canals is
disrupted, so the fine hairs send the wrong signals to the brain, and being
unable to work out which way is really “up” the sufferer falls over, totally
unable to save themselves from hitting the floor. Debilitating and
The commonest cause of interruption to the normal ebb and flow in the
semi-circular canals is produced by “ear rocks”. These are made up of
crystals of calcium carbonate, and we medicos call these “otoconia”. Imagine
these to be like sugar crystals in the bottom of your coffee cup. These now
swish around every time you move your cup, and likewise your “ear rocks”
swish around every time you move your head.
However, it is not all that simple (it never is, is it?) as the commonest
cause of BPPV in people under 50 is head injury. In older people, the most
common cause is degeneration in the semi-circular canals of the inner ear.
BPPV becomes much more common with advancing age, but in 50 percent of all
cases, BPPV is called ‘idiopathic’, which is a fancy word we use when we
have no real idea as to the cause!
Viruses can be accused too, such as those causing vestibular neuritis, minor
strokes such as those involving anterior inferior cerebellar artery (AICA)
syndrome, and Meniere’s disease are significant but unusual causes.
Occasionally BPPV follows surgery, where the cause is felt to be from a
prolonged period of lying on the back with the chin raised (for the
anesthetic tubes to slip down your throat), or ear trauma when the surgery
is to the inner ear.
Because there are some other conditions which can produce similar symptoms,
it is necessary to correctly identify the cause. Today, specialist clinics
(Hearing, Speech, Balance, Tinnitus) can identify the true nature of your
recurrent dizzy spells (so you may not have to take more water with it) and
look towards the correct further actions.
Is there any treatment? Yes there is, usually a series of maneuvers you are
put through which are designed to move the ‘ear rocks’ around till they no
longer cause problems. These are demonstrated by the balance specialists and
usually result in around a 90 percent cure rate.
If you are a sufferer from what looks like BPPV, do check in and have this
investigated. No need to suffer needlessly!
Heart to Heart with Hillary
Can nothing be done about the public transport here? The song taew drivers give
the place a bad name with their stand-over tactics and demands for fares much
greater than should be the case. No wonder the foreign tourists look for taxis,
but unless they have their wits about them they will again be quoted exorbitant
fares, rather than using the meters. This seems to be the norm for all of the
taxis parked at the side of the street. For a real fun time, try a tuk-tuk which
will attempt to take you straight to the nearest jewelry shop that pays for
their fuel. Until our city fathers meet the song taew monopoly head on and
produce a real public transport system, this will always be a third world
“Where you go?”
Dear “Where you go?”
Unfortunately you are quite correct in most of your comments, my Petal. The
songthaews which do not have any fixed or marked destination will always be a
turn-off for tourists, as the majority of the drivers do not speak another
language. Why would you expect them to get on transport with unmarked
destinations? Taxis advertise meters and refuse to use them, or “meter broken”
every time. Perhaps it is time for the TAT to get involved and issue ‘tourist
bus’ licenses for drivers who meet a minimum standard in communication. Hillary
has given up with the songthaews, taxis and tuk-tuks, and uses motorcycle taxis
when possible (still none in Chiang Mai). They appear to be a friendlier bunch
and will heed the “cha-cha” (slowly) instructions. You do have to barter first,
but that’s part of the fun of living in the ‘third world’.
My wife always forgets when her visa runs out and it always ends up with me
paying for overstays. I even said I would handle it if she wanted, so that this
did not happen all the time, but she asserts her independence all the time and
calls it interfering if I say I’ll take charge of it. This has happened more
than just a couple of times too.
Dear Visa Val,
You have come to the right person as yours is an easy problem to fix
(permanently). Your wife wants independence above all else, so give it to her.
Let her overstay and let her pay for the overstays at whatever it is a day at
the current going rate. With any luck it will cost so much they won’t let her
back in and all your future woes are fixed at the same time.
Please give that Mister Singha person the old heave-ho. Or if you can’t do it
through age or infirmity, let us know and we’ll happily do it for you. We are
tired of reading the drivel he comes out with.
Carl Saberg and the boys
Dear Carl (Saberg and the boys),
I think you are even more out of date than I am, my Petal. Carlsberg? Or
“Carlsaberg” as it was known, hasn’t been seen on these shores for some years.
But you have to remember the commercial side to all this - he did send me a bar
of Lindt chocolate, which is more than you have! Not that it is compulsory to
send me little gifts (but large ones are even more acceptable)!
Have you seen that funny photo of your venerable consultant clutching his second
edition? He looks as high as a kite and I haven’t laughed so much since Uncle
Jumbo caught his wotsit in the trouserpress! What’s he on, Hillary? What is the
old boy on?
I was about to consign you to the round file in the corner of the room, but I
relented, just to show you there are no hard feelings. The Lindt chocolate bar
did help your cause, but the goodwill from that is rapidly running out. You have
also got me in a quandary, Petal. References to consultants and “Uncle Jumbo”?
What are you on, Mistersingha? What are you on?
Why do the Thai girls all wear those molded plastic and rubber bras that look
like two dumplings attached to the front of their chests? It is obvious that the
lumps don’t belong to them, but come from their bra manufacturer. I’m like a lot
of guys and like a nice pair on a girl, but real ones, not rubber ones, please.
Tim the T-man
Dear Tim the T-man,
I presume you mean Tim the Toyman, you naughty little Petal! I must admit that I
have never heard the girls in the lingerie shops asking if madam would like one
lump or two, as I have heard in some five star restaurants over coffee. Perhaps
something swinging is going on behind the kitchen swinging doors that Hillary is
unaware of. Dearie me! Since Thai girls were standing behind the door when the
chests were given out (the Russian ladies made it to the front row), we have to
do something to catch the eye of Toymen like you, Tim. So you have discovered
our secret. Don’t tell everyone, that’s a good boy.
Let’s go to the movies:
by Mark Gernpy
Now playing in Pattaya
The Wrestler: US
Drama/ Sport – Mickey Rourke’s portrayal of an over-the-hill athlete has
won him many accolades, including a Golden Globe win and an Oscar
nomination as best actor. I think it’s truly quite a wonderful
performance of a loser of a professional wrestler – Randy the Ram – who
you wouldn’t ordinarily care about. But you end up caring about this
man considerably. I even got caught up in the so-called “sport” – which
I have always … well, despised. Directed by Darren Aronofsky (The
Fountain). Rated R in the US for violence, sexuality/nudity,
language and some drug use. Probably heavily censored for release here
– seems to be about 10 minutes shorter than the US release. Reviews:
Seven Pounds: US,
Drama/ Romance – I find this a dreadful movie, and it makes me feel very
uncomfortable just to talk about it. I think it’s grim, morose, undone
by an illogical plot, and shamelessly manipulative of your emotions.
But I must admit that Will Smith is a charismatic actor, and you can
hardly not watch him and get involved. In this unbelievable and
exasperating story, Smith plays an IRS agent who is depressed and
guilt-ridden about mistakes from his past, and he sets out to make
amends by helping seven strangers. Directed by Gabriele Muccino (The
Pursuit of Happyness). Generally negative reviews.
Miss You Again /
A-Nueng: Thai, Comedy/ Drama – The third entry in veteran director
Bhandit Rittakol’s popular teen romance series that began in 1992 with
I Miss You, and continued with I Miss You 2 in 1996. It’s
a teenage movie about old school friends trying to save their
financially-troubled school from closing and being sold to a big
Meat Grinder/ Cheuat
gon chim: Thai, Horror – A slasher/horror, torture-porn thriller
about a noodle-shop lady who serves up a special meat with her dishes.
Shades of Sweeney Todd!
Evolution: US, Action/ Adventure/ Fantasy/ Sci-Fi/ Thriller – This
film doesn’t open in the US/UK until April 8; they’re testing it on us
here in Asia! It’s the tale of young warrior Son Goku, who seeks to
fulfill his grandfather’s dying request to find the great Master Roshi
(a very delightful Chow Yun Fat) and gather all seven magic Dragonballs
before the evil Piccolo does. Feels much like being caught inside an
arcade computer game, but with less logic. Based on the hugely popular
1984 Japanese manga by Akira Toriyama which lasted for 519 issues and
spawned a phenomenally successful television series. This live-action
film, directed by James Wong (Willard, Final Destination),
is vastly confusing to all who have not read all 519 manga.
Animation/ Comedy/ Family – John Travolta does a superb job voicing
Bolt, a canine TV star convinced of his superpowers who sets out on a
cross-country journey to find his owner. I found it a complete delight,
containing many moments of real heart. If you at all enjoy animation,
don’t miss this one. Great for kids – and adults! Generally favorable
UK/ Canada – Action/ Drama/ Fantasy/ Sci-Fi/ Thriller – This film simply
blew me away! I think that once you accept the violence and the
comic-book origins, you will find it a monumental film. If you liked
The Dark Knight or A Clockwork Orange, you should appreciate
this. It’s complex and multi-layered, and set in an alternate 1985
America. Amidst all the blood there’s a lot of philosophy, and a lot to
think about and debate before you see it again. Rated R in the US for
strong graphic violence, sexuality, nudity, and language. Mixed or
Best of Times:
Thai Romance/ Drama – Leisurely romantic drama centers on two couples,
young and old. A young vet struggles to forget his first love, and when
he meets her again years later she doesn’t seem to remember him at all.
An elderly man and woman, each alone in the world, meet and fall in
love. I found it tedious and unremarkable, though I did enjoy the
performances of the older couple. By the director of Iron Ladies
Power Kids: Thai
Action/ Comedy – Except for the fights, a film of mind-boggling
ineptitude about kids battling terrorists in a hospital. Sloppy script
and plotting, sloppy directing and photography – none of which seemed to
bother the audience, who seemed to enjoy it immensely. Also has sloppy
English subtitles, e.g., “He’s been sleeping like vegetables for
Germany Drama/ History/ Thriller/ War – A well-crafted,
thinking-person’s action movie, with a really very good script; it’s
intelligent, makes sense, the dialogue is terse and expressive, the
plotting is solid, and it’s tense and exciting. About the near-miss
assassination of Adolf Hitler by a ring of rebel German army officers in
1944, starring a restrained and excellent Tom Cruise. For many reasons,
I think it’s a movie to be seen. Mixed or average reviews.
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