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Money matters:
Graham Macdonald MBMG International Ltd.
Alas, poor Lehman, I knew him well... part 1
Investment guru Jim Rogers was in Bangkok recently. Yes, the
Jim Rogers who was the former sidekick of George Soros, the Jim Rogers who
turned his back on Soros to motorbike around the world, the Jim Rogers, chairman
of Rogers Holdings, the Jim Rogers who believes “Until there is either a lot of
supply come on stream or the economy collapses, the bull market will continue,
the commodity Bull market that is.”
Even closer to home (our home) than Singapore-based Rogers is Dr. Doom - Marc
Faber, 62, who told investors to bail out of U.S. stocks before 1987’s so-called
Black Monday crash and who said on Aug. 15 that commodities may have peaked.
“Whether that is a final peak or an intermediate peak followed by higher prices,
we don’t know yet. It could go lower.”
Long term structural demand would seem to require higher prices and all the
fundamentals point to this. However, in the short term, the ride will be bumpy
but if you don’t pick a buy-in point, you could miss out altogether.
On another subject, time to doff our caps again to Dr. Faber. You may remember a
recent report of his highlighting the fragility of American banks and financial
companies, culminating in a top 10 vulnerable institutions. We have added status
updates alongside Dr. Faber’s original list:
1. Bear Stearns: 313.97% - Bought out
2. Morgan Stanley: 234.88% - Stand-alone investment bank (like Bear Sterns and
Lehman Brothers), has already taken write offs of $11.7 billion
3. Merrill Lynch: 225.4% - Bought out
4. Goldman Sachs: 191.56% - looking for a suitor at any price?
5. Lehman: 171.18% - Filed Chapter 11, 15th September 2008, at the U.S.
Bankruptcy Court for the Southern District of New York
6. Fannie Mae: 161.48% - Bailed out in largest government bailout in US history
7. Northwest Air: 142.02% - Exited Chapter 11, May 2007
8. Citigroup: 125.06% - the big one! Would make Fannie & Freddie look like a
drop in the ocean
9. Prudential: 119.36% - should be able to work through unless there’s a major
widespread panic, which there will be!
10. Hartford: 108.52%. - Reeling from heavy exposure to Fannie Mae & Freddie Mac
Preferred stock
Five down, five to go, not forgetting that many troubled financials are not on
this list (which only ranked institutions on one problem measure - % of
potentially worthless tier 3 assets to market cap). For example, there is no
Washington Mutual which has an estimated $28 billion of losses to carry on its
balance sheet and not forgetting the dramatic increase in the failure rate of
regional banks along with the failure of IndyMac Bancorp Inc. (the 3rd largest
banking failure in US history).
Peter Kenny, of Knight Equity Markets, said the financial world is on the verge
of a complete re-organisation. “The US financial system is finding the tectonic
plates underneath its foundation are shifting like they have never shifted
before,” he told Reuters, while Bill Gross of PIMCO warned of an “imminent
tsunami” as dealers are forced to unwind complicated derivative and swap-related
positions. Alan Greenspan, former chairman of the Fed, warned last week that
other big institutions could yet be vulnerable; a shocking situation for Wall
Street where the big investment banks have, for so long, enjoyed an air of
invincibility. Greenspan described the credit crisis as a “once-in-a-century”
type of event and went on to say, “There’s no question that this is in the
process of outstripping anything I’ve seen and it still is not resolved and it
still has a way to go.”
The real problem is that the US has become arguably the world’s most
sophisticated financial market but still has caveman regulations. We have
written so many times bemoaning the fact that the main body of what the SEC does
was written by a very effective poacher-turned-gamekeeper. However, an
ex-bootlegger may well have been the ideal guy to write the rules in the late
1920s to stop the frequent stock scams that were run at the regional bourses
that then operated alongside Wall St but the lack of reform and modernisation to
this system is ridiculous.
The vast majority of American investors are denied access to risk-reduction
techniques that could protect their portfolios while banks charged with custody
over investors’ assets go around developing business strategies that seem to owe
more to a weekend jaunt to Vegas. Add to this the pressure on all CEOs to
sacrifice the long term benefit of the company for short term gain and it
becomes an explosive mix.
There must be many reasons why Bill Gates has been so successful BUT one of
these is that MSFT seems to have a focus on the medium term future that is very
different to that of most companies. Trying to pretend that Enron somehow
skirted the system was nonsense - these may have been weak guys but they were
basically products of a system that encouraged people to exploit the law.
The bottom line is that:
1) It made long term economic sense to create Fannie Mae back in the 1930s -
this helped the recovery from the Great Depression.
2) It was bogus accounting when LBJ nationalised FNM in the 1960s to make the
national balance sheet look better. Since that time there’s always been a loaded
gun. Now it’s smoking.
The collapse of Fannie Mae and Freddie Mac that led to the collapse of Lehman
Brothers and the hasty sale of Merrill Lynch is actually the result of a whole
series of small steps dating back 40 years and not just something that happened
in 2007.
I have read quite a lot of stuff lately about specific abuses of the system by
the two entities and their management and I’m sure that some or most of this is
true and that it is pretty awful, but like Enron it’s more a symptom of the
malaise - a global society that has become all about getting richer quicker
through some nifty accounting moves rather than creating a business that does
something.
I don’t blame Raines; I blame the likes of Raines who, in different colours,
flavours, etc., dominate so much global corporate life these days - people are
focusing on how bad it is in the US where the stakes are highest but this isn’t
a local problem - it ain’t pretty in Russia, Ireland, Thailand etc.
To be continued…
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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
Digital photography problems
 Despite
calling this item “digital” photography problems, most of these refer to
all photography, digital or film, though there are some specific areas
which refer to digital cameras and their capabilities.
The first is a general complaint, and refers to the placement of the
image in the frame. This is where the ability to instantly review images
in digital photography is so good. Look at the image in the viewer on
the back of the camera and see if it can be improved by different
placement of the subject within the frame. Remember the ‘Rule of Thirds’
(place the main subject one third of the way in from either side and one
third of the way up or down from the top or bottom of the picture). This
is a tried and true rule of thumb and you can try it out so easily with
digital photography. It may feel ‘wrong’ initially not having the
subject slap bang in the middle of the frame, but try it and you will
find you are getting better, more pleasing pictures.
While still on the subject of the overall image, don’t forget to take
each shot two ways - in the landscape (horizontal) format and the second
in the portrait (vertical) format. Again it sounds strange to shoot a
landscape in the vertical format, but it gives the viewer a different
emphasis, which can improve an otherwise ‘ordinary’ shot.
With most digitals having reasonably good zoom lenses these days,
experiment with different zoom settings and distance from the subject. A
‘tele’ setting can give you a very different photograph from the ‘wide’
setting taken closer to the subject. This ability to experiment, at the
time of shooting, is one of the biggest plusses for digital photography.
One of my standard tips is “Walk several meters closer”, and by doing
this you will find that you can make the subject fill the frame (to even
overflowing) and get rid of horrible distracting backgrounds.
You can also see the difference in the backgrounds between shooting at
f2.8 as opposed to f16. The larger aperture (f2.8) gives a blurred
background, which is exactly what the ‘portrait’ mode does. Many of the
tricky settings are just automatic combining of different
apertures/shutter speeds, and a general knowledge of first photographic
principles will always help your photography too.
Photography is in reality ‘painting’ with light and you should never
forget this. The position of the subject, relative to the sun (the
celestial lighting technician) can make or break your photos. The amount
of contrast in any scene can also baffle the digital sensors so they
will try to balance out the contrasts which can spoil the effect you
were trying to create. If your camera shows you those dinky little
histograms, you can soon see if the light is biased in any particular
direction.
What you have to do is try and balance bright or dim light. In low light
conditions, try using your camera’s night shooting mode, or lower the
ISO to 50 or 100 to get some detail in low light. Also look at trying to
use a tripod, or steady yourself against a wall or pillar to avoid
moving the camera.
In bright light, try your camera’s Beach or Sunshine mode, or go to
manual mode and choose a fast shutter speed to control the amount of
light that comes in.
Be careful if you place your subject in front of a bright window or they
will become a silhouette. Try placing them off to the side of the window
instead, or facing a natural light source.
For better photographs indoors, turn your flash off. Try to maximize the
light by pulling back the curtains, opening doors and turning on the
incandescent lights in the room. Sure, you will have slower shutter
speeds and you may have to look at using the tripod, or even just
holding the camera firmly on a table, but you will get more natural
photographs.
Finally, practice getting the ‘decisive moment’ by partially depressing
the shutter button when taking candid shots. This means you are not
waiting for the camera to focus, before the shutter fires. Or simply set
the focus manually.
Modern Medicine:
by Dr. Iain Corness, Consultant
See your heart in 64 slices
Following on from World Heart Day, I thought it would be of
interest to look at the diagnostic procedure known as the 64-Slice CT. This
is one of the ways of seeing what is the condition of your coronary
arteries.
What is often not realized is that the heart muscle does not get its
oxygenation from the blood inside its chambers, but through separate
arteries that run around the heart and supply the heart muscle directly.
These are the coronary arteries.
When the coronary arteries begin to be blocked, this is known as Coronary
Heart Disease and refers to the gradual build up of ‘plaque’ (and it is not
the dental kind) in the inside of the coronary arteries, the arteries that
‘feed’ the heart muscle.
If the inside diameter of the coronary arteries is reduced by 50 percent, it
means that the oxygen required cannot be supplied in enough quantities to
keep the heart muscle alive when it is called to perform extra work, such as
running to (or out of the way of) a baht bus, for example. Constriction
greater than 50 percent means that the heart muscle ‘starves’ of oxygen even
more quickly.
We know these days that the ‘plaque’ build-up is made of cholesterol and
calcium, and that the likelihood of deposits depends on many factors,
including diabetes, high blood pressure, high cholesterol levels, stress and
cigarette smoking. This is why we advocate regular testing for those
physical factors, and strongly advise you to give up smoking! We actually do
want you to live a little longer, with a good quality of life.
To diagnose coronary artery disease, we will evaluate a patient’s risk
factors and perform some tests and then divide the patients suspected to be
at risk into the two groups; high and low risk. After that, there are two
main diagnostic procedures that will usually be performed, conventional
coronary angiography or the 64-Slice CT.
Conventional Coronary AngioGraphy (CAG because we medico’s love acronyms, as
you know) is probably the ‘gold standard’ to accurately assess the coronary
arteries, and gives an immediate clinical evaluation of known or suspected
coronary artery disease. At this time, if blockages are found, the patients
are already prepped and balloon and stent can be inserted. An immediate
treatment which gets the patient quickly out of danger in the short term.
However, whilst it may be the gold standard, it is also expensive (like
gold) and time consuming, as it requires a stay in hospital of four to six
hours. Being a direct intervention, with cardiac catheters, there can also
be a risk of hemorrhage, though this is not usually the case. But it can
happen.
The alternative is the 64-Slice-CT. This is the latest variation of CT
scanning, with the original known as 16-slice CT. This was fine for
assessing organs which did not move, but was not as accurate in
demonstrating coronary artery problems, because the heart is moving and
beating inside the chest (unless, of course, if you have died already).
However today, with the advent of the most advanced form of this imaging,
the multi-slice detectors and high powered computer programs called the
64-Slice CT, we can efficiently get information on the coronary arteries in
as few beats as possible, in around 4 seconds. And this comes with 90
percent accuracy.
The 64-Slice CT has many advantages. First off, nobody is actually slicing
you open to insert cardiac catheters into your arteries. The 64 ‘virtual’
slices are done of your cardiac image and the coronary arteries by the
computer program, not physically. Each slice is 0.625 mm, so will be able to
pinpoint calcium deposits. It is a quick and painless procedure. You do not
have to wait around in hospital afterwards, other than perhaps wait for the
radiologist’s report. A boon for the busy businessman (the group most at
risk). And finally, it is much cheaper than having a coronary angiogram.
If you have no risk factors, other than being over 50, I would seriously
consider the 64-Slice CT. Forewarned is forearmed!
 Heart to Heart with Hillary
Dear Hillary,
First of all thank you for the helpful reply to my last letter regarding food,
as usual you were spot on with your reply. The Imodium by the way is to
compensate for the excessive amount of chillies in the food offered (gentle
stomach and all that)!
Now, not only is it “Amazing Thailand” it’s also “Amazing Hillary” - fancy you
remembering my lost helmet, that was years ago. But as long as it’s now
protecting someone’s head I don’t mind losing it. In fact I wouldn’t mind losing
one a month at B. 190 per helmet, if I thought it would save someone’s life.
The other thing about locking my bike, well I think I am getting what’s known as
“Old Timers Disease”, as I must admit I still forget and leave it in my bike now
and again. I was told to attach the key to a long string which would go around
my neck. But knowing me if I ever fell off the bike I would probably strangle
myself.
Can I tell you something funny? I was at an intersection on the bike at night. I
had put my right foot on the road, not noticing a rope on the road which had
formed a loop over my right foot. As I took off the rope tightened and I ended
up sitting on the road as my bike carried on! My pride was hurt more than my
backside Hillary.
Thanks again for all your help, I have some photos to send you of the Petro
Diesel Plant the young Abbot of Wat Doi Noi has got going, he produces one litre
of fuel from one kilo of plastic. He is an amazing young monk.
All the every best to you all at “The Mail”,
Delboy
Dear Delboy,
How could I possibly forget you, my Petal? It’s not every week that I get
someone looking for their lost helmet in an Agony Aunt’s column. By the way, you
definitely seem to be a little accident prone, Delboy. Have you seen anybody
about this? Is it perhaps a subconscious attempt to get Hillary to your bedside
to cool the fevered brow? If so, forget it! I did the fevered brow scene years
ago and it wasn’t worth it. What is your abbot going to call his fuel? Whatever,
it must be “the best fuel for your karma” (or is that ‘car’ma?) I would imagine.
Please ride a little more carefully, you’re not a young man any more, no matter
how good you were before!
Dear Hillary,
My name is Sureporn, and I am a Thai woman, working in an office here in the sex
and sin city who have been reading Pattaya Mail and your column for years. I
wrote to you once long time ago, could not remember what it was, in hand
writing. Anyway, I am writing you today again to tell you how I enjoy your
column.
I enjoy learning foreigner’s point of view in life - I mean your’s and your
readers’, the style of putting out their opinions, their home countries and
everything. Personally, I always admire their punctuality and being discipline
which we Thais are so weak at this. Your column is very helpful to me to learn
the differences of people in this world.
As I am studying Humanities at Ramkhamhaeng University major in English, I would
like to say here that I have learned a great deal of knowledge from your column,
and this has helped my studying to become a very interesting one. I thank you.
You are like my religion here. I hope you keep doing this useful job for a very
long time.
Lastly, to have my letter for a change in your column would not be so bad, yes?
Readers need vacation, too.
Always,
Thai woman
Dear Thai woman,
How kind of you to write again, even if you can’t remember what it was about
(and neither can I, but the advice would have been perfect). Yes, there are many
differences between farangs and Thais, and more than just big noses and round
eyes. Some of the differences are good, some bad. Foreigners have learned how to
use a wrist watch, whilst the Thais are still inventing excuses for being late.
One day they will fix the traffic in Bangkok and hundreds of people will be
without the ‘rot dit’ excuse, and then all we will have left is to blame the six
hour clock system.
You are correct where you have noted that foreigners are not afraid to voice
their opinions and most remain very proud of their roots, even though they have
come to settle down in Thailand. This comes through a different style of
education where the child is encouraged to put forward ideas.
However, I must take you to task over your suggesting that Pattaya is the “sin
and sex city”. Where did you get that from? Since when did “sex” become a “sin”?
Just because there are man-made laws to cover sex for sale, does not necessarily
make the act a sin. And honestly, if Pattaya is a “sex and sin city”, what is
Bangkok, with its Patpong Road, Soi Nana, Soi Cowboy and 3,596 karaoke bars? Or
London, Amsterdam, Munich, Sydney, or Mumbai?
Let’s go to the movies:
by Mark Gernpy
Now playing in Pattaya
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 family, the phone calls push the two into a series of increasingly
dangerous situations. These two ordinary people become the country’s
most wanted fugitives, who must now work together to fight a faceless
enemy who seems to have limitless power to manipulate everything they
do.
Dive!: Japan Drama - Three young men try to turn their dreams of
Olympic gold into a reality in this sports drama from Japan. The Mizuki
Diving Club has enjoyed a reputation for transforming talented young
divers into world-class champions, but in recent years the club has had
a run of bad luck, and with few winning divers emerging from their
ranks, sponsorship is dwindling and unless things change the MDC could
go out of business.
Mamma Mia!: US/UK/Germany Comedy/ Musical/ Romance - Meryl Streep
plays Donna, an independent, single mother who owns a small hotel on an
idyllic Greek island, and who is about to let go of Sophie, the spirited
daughter she’s raised alone. Sophie, on a quest to find the identity of
her father to walk her down the aisle, invites to the wedding three men
from Donna’s past, all possibly her father. Contains much ABBA music
that is horrifyingly infectious. It’s an extraordinarily vivacious and
energetic musical that is bound and determined to make you sing and
dance and feel good about marriage and things like that. Mixed or
average 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 and crass comedy, you
should like this one very much. Here he plays the Israeli/Palestinian
conflict for laughs. I laughed. A lot. And cringed. A lot. Mixed or
average reviews.
Burn: Thai Thriller - All you ever wanted to know about “SHC” -
Spontaneous Human Combustion. As you certainly know, that’s the familiar
medical condition wherein a living human being suddenly bursts into
flames. Director Peter Manus comes up with a pretty far-fetched
explanation for this pretty far-fetched human malady. Slow and not
really too scary or gory; the film is more of a drama, and you’ll be
quite surprised at who the villain turns out to be. Some interesting
effects and moods.
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 pop singer Charlie
Yeung in a quite affecting performance) while also forming a friendly
bond 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.
The Coffin/Longtorai: Thai Horror - Ananda Everingham as a
claustrophobic architect who participates in coffin rituals to gain a
new lease on life. It has much going for it, with a stellar cast and a
fine director, but I was mightily confused. It didn’t seem to be the
movie that director Ekachai Uekrongtham set out to make. The script won
a prestigious prize from the Rotterdam Festival, but the movie hadn’t
been made yet, and to get the necessary funding he had to change it into
a horror flick, making compromises along the way. The beautifully shot
opening sequence of the burial ritual at the temple gives an idea of
what the film could have been.
Boonchu 9: Thai Comedy - A continuation of this popular Thai
comedy series. The son of the original Boonchu is a happy monk who is
defrocked by his mother and sent to university in Bangkok. There he
meets up with questionable new friends who drug him and mug him. But it
all turns out all right eventually because this is a feel-good movie for
Thais from start to finish. It is the gentlest of comedies/family
dramas, with the sweetest of characters.
The Deaths of Ian Stone: US/UK Horror/Thriller - On an ordinary
night, the young Ian Stone encounters a mysterious creature and is
forced into the path of an oncoming train. Rather than facing certain
death, Ian finds himself reborn into a new life that feels strangely
familiar. It soon becomes apparent that Ian is being hunted by an evil
presence, and will be forced to die every day until he can solve the
mystery of his own life. Rated R in the US for violence, some drug
content, and brief language. Generally favorable reviews.
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