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Money matters:
Graham Macdonald MBMG International Ltd.
Running Scared, part 3
More on currencies
The main question with the Swiss franc is: whether, relative to the
euro, the Swiss franc will remain more or less unscathed by a slowdown in the
European economy. Again, there is the argument that the Swiss franc is currently
overpriced and as Europe slows down then so must the Swiss franc. However, the
Swiss economy does not have the same extreme problems as Ireland or Spain and,
therefore, may well feel less of an impact in relation to the valuation of its
currency to the USD and GBP. It is too close to call and there is no general
clear picture of an evident currency cycle here.
This dichotomy is largely built around whether recession or inflation is the
greatest danger for the Western economies. There are few places that have the
luxury to be worried about only one problem. Japan is one of them. The Bank of
Japan is also, obviously, watching inflation. But after years of deflation, a
central price index pushing 1% is almost a relief! Indeed, sales at department
stores recently jumped - because buyers, expecting inflation, decided they could
get a better deal by loading up now (the “under the futon money” is starting to
leak into the economy). This is not a surprise, and helps explain the out
performance of the domestic aspects of the country’s stock market - just knowing
where Japan stands would make the market look relatively attractive.
Unpredictability is the key word here and too many questions beginning with ‘if’
and ‘what’ overshadow the Japanese economy. If inflation continues at the same
rate, what effect will this have upon the currency value and what will the Bank
of Japan do with borrowing rates in order to slow down inflation? A stronger yen
is a distinct possibility but the greater drama may play out in the Western
currencies and then yen’s recovery might be relegated to being a sideshow.
Sometimes the hardest thing to do is to do nothing, and sitting in base currency
is doing nothing in terms of currency attribution to either portfolios or loans.
However, we would want a clearer picture before we felt able to make moves
either way.
At the seminar, MBMG’s managing partner, Paul Gambles was asked “Where do you
see the USD: GBP cross rate a year from now?” His reply was, “The higher
probability is that USD will be the stronger but there are huge risks to the
downside too. If you want me to name numbers then I’d give a range of anywhere
between parity and $4 to the pound. That makes it impossible to make currency
allocations with any confidence and, therefore, our advice for both assets and
liabilities right now is to hold base currencies so that you know exactly where
you stand.”
For the moment, every investor or multi currency mortgagee should consider
investing almost exclusively in their base currency. We predicted that these
conditions would come and we told people how to position for it (see old
Pattaya Mail columns on the Pattaya Mail website). The fact we are saying
that there are not any good currency calls right now, go safety first and hold
base currency is not a negative, it’s a positive - that is what we strongly feel
is the right position right now. When times are frightening, fear is a very
healthy response! So, what does this mean for investors right now?
Investment approaches
There are three approaches that we favour now:
1) Safety first - an element of sidelining and awaiting events so that the
picture becomes clearer and we can respond - the danger with this is that you
can miss the bottom. Our 50% allocation to Core Diversified is our main play to
prevent that happening - Scott Campbell has identified some exceptional
opportunities and it is certain that, in many cases, he WILL be too early on
some of his moves. This is because the only way of being sure not to be late is
to be too early.
2) Exploitative trading - buy way too cheap in the hope of selling a bit less
cheap; the opportunities that exist right now are more to do with asset
mispricing than with recovery. That is to say that we are not buying stocks on
the basis that the stock market or parts of it will bounce back and we can sell
at a profit once this happens. It is not clear to us that this will happen.
Midas Special Situations, Berkshire Hathaway, GAA Q Fund and the Orbis equity
fund range are all key satellite holdings of our own funds and all share a
common philosophy; namely that they adapt the way that operate to different
economic conditions - look for something that is selling at the wrong price (too
cheap) and buy it until it sells at the right price.
This is a good approach now, which is why Scott is currently incorporating this
into Core Diversified also. It does not mean that the prospects for an asset
need to get better; it just means recognising that a specific situation has
caused a pricing error and exploiting that.
A good example is UK commercial property - the fund prices are down by 50% - we
expect that the property values will fall by 15-30%. Once it becomes clear how
much they have fallen, the fund price and asset price will start to match each
other. So, if we are right then we would make a gain of 40-70% (we pay 50 pence
for units that have fallen 50% from 1.00 but the underlying properties are
really worth 70-85 p. per unit - a gain of 20-35 p, on our 50 pence invested).
What if Scott’s wrong? Well, even if commercial property falls by 45%, we still
net a 20% gain from this trade - only if property falls by more than 50% are we
in trouble.
Commercial property is valued on the rental income relative to interest rates.
In a falling interest rate environment property yields would have to fall to
levels that are implausibly low in any conditions for there to be a fall of more
than 50%.
Our proprietary calculations are that current and expected occupancy levels to
fall to just 30% and to remain at that level indefinitely. Bearing in mind that
government and quasi governments take up such a big chunk of central London
commercial rentals then in that market this probably equates to something like 8
out of every 10 businesses or offices closing down completely.
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
The Hitchhiker’s Guide to Videography
 So
you have a new video camera, or even a still camera that also takes
videos. Is this a completely new ballgame? Not really, there are many
similarities between still photography and videography. Essentially you
are catching a moment in time, but the still photograph condenses that
down to a split second in time, whilst a video is a collection of
seconds, one after the other. However, try not to shoot ‘stills’ with a
video camera and your videos will start to look professional
immediately.
Lighting and exposure is very similar between the two genres. Good
lighting produces a good final image, still or video. Making the subject
the ‘hero’ in the shot is the same for still and video, so the walking
in close rule applies to both.
Like all aspects of good camera work, you have to think about the end
product before you begin to shoot. For the video photographer it is a
case of working out the story line and then how to shoot the various
elements in the story.
One of the ways you can pick the first time video user is the fact that
the camera operator spends much time taking shots of still subjects.
Having not made the mental adjustment from still photography, many
minutes are taken up with a video of his wife standing by the front door
of the hotel. That was a ‘still’ shot. With video, you film your wife
checking out at the cashier’s desk, picking up her bags and walking
towards the exit. Then you rush outside and the next footage is her
coming out of the hotel and hailing a taxi. You have just shot a living
‘story’. A collection of split seconds placed end to end.
So where can you go to ‘learn’ this new art? Just as still photographers
have photographs in books and magazines to study, the video photographer
has a very ready source of informative examples to scrutinize. This is
called TV! Sit down in front of the goggle box and see how the pros do
it. Start to look critically at technique. Where was the camera,
relative to the subject? Did they “zoom” in or was it one far shot and
another close up to follow? How many times did the cameraman actually
use the inbuilt zoom? You may be amazed to see how seldom!
Here are a few more “rules” which can help you produce better video. You
should shoot people in full or three-quarter profile to let the viewers
see both eyes. The one eyed effect does not look good. Again, look at
TV. When two people are talking, the camera shoots over the shoulder of
person one to shoot the second person face-on to the camera. When the
first person replies, the shot is taken the other way, over the shoulder
of the second person. You can also take shots of the person who is
listening to the other speak. These are called ‘noddies’, because the
person will be nodding while listening to the other speaker.
When shooting people, place the subject’s eyes one-third down from the
top of the frame no matter the type of shot. It is that old rule of
thirds from still photography again. Dead central is dead boring!
Another shot to avoid is one with large distances between people. Again,
look at the soaps on TV. The people are really standing much closer than
they would in real life (in each other’s personal space in fact), but if
you have them a meter or so apart, you lose ‘contact’ in the video.
Focusing. This is a common problem with still cameras with Auto-Focus
(AF), and 99 percent of video cameras are AF too. The magic eye in the
camera focuses on a spot in the middle of the screen. When you are
filming a couple, if the magic dot is not on one of the people, they
will end up out of focus and the background perfectly sharp.
Application of these simple aspects of video photography will give you
(and those who watch your videos) a much better end product, and a much
more satisfying one for yourself to produce. It just takes practice.
Modern Medicine:
by Dr. Iain Corness, Consultant
Fat, happy and healthy
Ah, if it were only true that one could be fat, happy and
healthy! Unfortunately, that seems to be a long way from the truth.
Professor Martin Wiseman, Medical and Scientific Adviser for the World
Cancer Research Fund (WCRF), believes today’s children could face big
increases in rates of cancer as adults, unless something is done to curb the
obesity crisis.
Speaking ahead of a London conference organized by the charity and the
Association for the Study of Obesity (ASO), Professor Wiseman said the fact
that a third of women and half of men are projected to be obese in 40 years
is one of the most important reasons for the expected doubling in cancer
cases.
He said, “The evidence now shows that, after not smoking, maintaining a
healthy weight is the most important thing you can do for cancer prevention.
This means that if rates of obesity continue to rise then this will have
serious consequences for cancer rates in the UK.”
He continued, “Unless something happens soon to stop the increase in obesity
then we are sleepwalking towards a situation where the UK will be facing
more cancer cases than ever before. Rising obesity rates are not the only
reason we expect the number of cancer cases to double over the next 40
years, but it is an important factor.”
Now that is in the UK, but have you had a look around you recently? Not only
are the foreigners tending to obesity, but so is the local Thai population.
Thirty-odd years ago, when I first came to Thailand, everyone was small and
slender. Today is a different story, with larger Thai ladies (in all
aspects) being commonly seen. Thailand’s epidemic is coming.
Going back to the western nations, the authorities in the USA, UK, EU
countries and Australia are all stating that the obesity epidemic is there
already, and on every overseas trip I make I am left gasping at the common
sight of obese persons everywhere.
Returning to the obesity conference, Professor John Wilding, chairman of the
ASO, said, “This is an extremely important subject because there is
convincing evidence that excess body fat is a cause of several types of
cancer. This is why it is so important that we understand and promote this
subject as much as possible.”
The WCRF report ‘Food, Nutrition, Physical Activity, and the Prevention of
Cancer’, is the most comprehensive report ever published on the links
between lifestyle and cancer risk, and it found convincing evidence that
excess body fat is a cause of cancers of the: bowel; breast
(post-menopausal); endometrium (womb); esophagus; kidney and pancreas.
The World Cancer Research Fund (WCRF) has as its charter to raise awareness
that cancer is largely preventable and helps people make choices to reduce
their chances of developing the disease.
This includes research into how cancer risk is related to diet, physical
activity, and weight management, and education programs that highlight the
fact that about one third of cancers could be prevented through changes to
lifestyle. I suggest that a quick trip to www.wcrf-uk.org is worthwhile.
Despite the convincing evidence that being overweight increases risk of
cancer, a recent UK government survey showed just half of people in Britain
are aware of this. This is probably the 50 percent which is not overweight.
The National Cancer Institute states the causes of obesity very simple, and
you can forget about “big bones” and “it’s hormonal” or “I come from a big
family”. The experts have concluded that the chief causes of obesity are a
sedentary lifestyle and over-consumption of high-calorie food. They further
state that they have found a strong correlation between lack of physical
activity and obesity, and a diet high in calories and/or fat appears to be
an important factor in obesity.
Really, it is an open and shut case. If you are overweight, do something
about it. Reduce your calorie intake and increase the physical exercise side
of your life. Your future depends on it.
 Heart to Heart with Hillary
Dear Hillary,
With all this rubbish being written to you about all the girls in Thailand being
on the game, it really is time to get the record straight. Even in Pattaya, the
so-called sin city, the number of girls who work in the Royal Garden Plaza,
Tesco, Big C, Carrefour, the hospitals, the eye clinics, the dental clinics, the
gas stations, banks, tour companies, the list can go on forever. You don’t need
to be Einstein to see that while there are the easy ladies in the bars, the
great majority are normal girls from normal families doing normal work and
following normal moral values. Please, no more of the rubbish which insults all
the normal women and girls in Thailand.
Einstein
Dear Einstein,
I am so glad to see you are still alive and well, and now apparently living here
in Thailand. You will do much good for our society. I do agree with you, Petal.
There is much shortsightedness that comes across in my letter writers from time
to time. Certainly the ladies of the night have a place in the society (mainly
sitting on a stool outside beer bars saying “Hello sexy man, come inside
please”) but they are not the majority; however, for those who look at life
through beer glasses they are the most easily spotted. There is one other
important fact that you have overlooked yourself, Khun Einstein, and that is the
people who write in do have personal genuine concerns and questions, and even
though you personally do not share those worries, it is my job as their
counselor to answer those questions and allay their fears.
Dear Hillary,
I just wanted to thank you for making a happy year for me. After a few bad
starts at finding a good woman, I started reading your articles and found that I
wasn’t the only one with problems. So I could see where we were all going up the
wrong road. I slowed down and took a turn the other way and very soon met a
beautiful woman who was interested in me and not my bank account. She has never
asked me for money for anything, while all the ones before always had their hand
out for something or other, new phones, gold and all the other reasons that
these women seem to find. I could appreciate her for what she was - a good
woman. Left alone to raise one daughter life was hard for her, but she had
worked hard and had a good job. I consider myself to be very lucky to be with a
woman like that. I am happy with my ready made family, so I just wanted to say
thank you. Sorry no champers, but maybe next time I’m down your way I can thank
you in person.
Bill
Dear Bill,
Thank you for brightening up my day, Petal. It is always heart warming to find
people who have not lost sight of life and what it means. There are so many of
what you call “good women” out there, you just have to look in the right places.
As I have said before, you don’t go to the hardware shop to buy cheese, now do
you! I hope your happiness continues, but from what you have written, I am sure
it will. I look forward to meeting you and your “good woman” some day.
Dear Hillary,
I come over to Thailand once a year and every year it is the same. Fun, fun,
fun. By the end of my three week vacation I need the fourth week to recover.
What I am wondering, is how do the guys who live in Thailand keep up the pace?
Is it just blue diamonds or what? I’m only 35 and I see some much older blokes
than me who seem to be regulars in some of the bars.
Jack
Dear Jack,
Have you ever heard about the kid in the candy store? That’s you, my Petal. The
guys who live here perhaps do resort to the blue diamonds for their viagorous
exercises, but many of the older chaps you see in the bars who are regulars have
got through the candy shop stage. But as you say, you are only 35, so enjoy life
Jack, who’ll be back. The bars will still be here on your next holiday.
Dear Hillary,
Pater is suffering/enjoying a prolonged bout of erectile grossfunction and has
been compared favorably to a miniature version of Lord Nelson’s column! His
handmaiden, wee Nok, is finding his situation hard to grasp and is prepared to
knock it (ha, ha) on the head! “Hard Times” by Charles Dickens sheds no light on
wayward members so what can Pater do? Do not underestimate the size of this
problem, Hillary! Can you handle it?
Mistersingha
Dear Mistersingha,
Give you an inch and you take a mile (or in the new money, give you a centimeter
and you take a kilometer). I forgave you after you sent the Bacardi Breezer and
the chocolate bar, though they were hardly French champagne and Belgian
chocolates, and now you thank me with this. All I can say is I can (probably)
see you point but (fortunately) I can’t quite grasp it. Please desist.
Health & Well being
24-hour walk to raise awareness of Cervical Cancer
Pan Pacific Bangkok Walk 4 Women 2009
Michal Zitek, general manager of Pan Pacific
Bangkok poses with co-sponsors and media partners, including
celebrities, in the official launch of Pan Pacific Bangkok’s Walk 4
Women 2009 at the Pacific Ballroom 4-5, Pan Pacific Bangkok.
Pan Pacific Bangkok, supported by the Sports Authority of Thailand,
Tourism Authority of Thailand and National Cancer Institute, proudly
launches the campaign “Walk 4 Women 2009” aimed at raising funding and
awareness for Cervical Cancer a major women’s health risk; promoting
prevention and a healthy lifestyle in today’s modern times.
Cervical Cancer is the most common cancers in Thai women; an estimated
6,100 new cases are diagnosed annually with 3,100 deaths caused each
year. Most cases in Thailand are diagnosed at an advanced stage, which
makes it more difficult to treat and cure patients.
Pan Pacific Bangkok Walk 4 Women 2009 will occur on February 7-8 2009 at
Lumpini Park. 500 people are expected to complete the walk in 24 hours,
and a hundred more will participate in the surrounding entertainment and
events. It is anticipated that 2,000 people will participate in the
event, including a number of prominent celebrities.
The course navigates the beautiful scenery of Bangkok’s Lumpini Park –
creating a wonderful setting for this worthy event. Participants will be
categorized by 24 hour walk/run individual and 24 hour walk/run team.
The course is a 1.2 kilometer loop within Lumpini Park with start and
finish at the Lumpini Park Open Air Theater.
The funds raised by the Pan Pacific Bangkok Walk 4 Women 2009 will be
donated to the National Cancer Institute to assist with research and
support for cervical cancer patients.
This is a prime opportunity for companies and individuals to demonstrate
their focus on social responsibility by participating in a fun event
supporting a very worthwhile cause.
Registration at the Public Relations Department, Pan Pacific Bangkok
02-632-9000 / Go AdventureAsia Co., Ltd 02-2362931-32/
www.walk4women.com and www.goadventureasia.com
For more information contact Bhakanundh Thanasom (director of PR) and
Krongthong Kirdnark (PR coordinator), 02-632-9000#4117 and 4107.
Let’s go to the movies:
by Mark Gernpy
Now playing in Pattaya
Traitor: US Drama/ Thriller – Another serious look at the
world of moral uncertainty amid the war on terror. I am a lot more fond
of this movie than most reviewers. I think Don Cheadle gives another
outstanding performance in this film – really a great person to watch.
And I found the story (by Steve Martin – yes, him) very engrossing.
It’s one of a very few terrorist-themed movies that presents its
situation without resorting to exploitation or oversimplification. But
only mixed or average reviews.
Burn After Reading: US Comedy/ Crime – I really enjoyed this
interesting movie which stars George Clooney, Brad Pitt, Tilda Swinton,
and John Malkovich (the whole team of serious anti-government, anti-CIA
rabble-rousers) in another expose of dirty dealing and incompetence in
high places. But this time it’s a comedy! Clooney, for example, seems
to have a hobby of building homemade sex toys in his basement. I found
it very funny indeed. Directed by Ethan and Joel Coen.
007 – Quantum of Solace: UK/US Action/ Adventure/ Thriller –
Starring Daniel Craig and Judy Dench. Really a continuation of the 2006
Casino Royale, which was a reinvention of the James Bond film
series for present-day audiences. Here, with a different director, I
found the undertaking greatly diminished in charm and style and
elegance, with the action sequences more mindless and muddled, the plot
vastly more convoluted and confusing, but with much to still like if
you’re a fan of Bond films. The locations are grand, as are Bond’s
female foils and villains. Mixed or average reviews.
Midnight Meat Train: US Crime/ Horror – Creative and energetic, with
enough scares and thrills to be a potential cult classic. Unusually
literate for a slasher. Rated R in the US for sequences of strong
bloody gruesome violence, grisly images involving nudity, sexual
content, and language. Mixed or average reviews.
Painted Skin: China Action/ Fantasy – An action-thriller about a
vampire-like woman who eats the skins and hearts of her lovers in order
to maintain her beauty. Thai dubbed only, with no English subtitles.
Tropic Thunder: US Comedy/ War – I heartily recommend the film for
those not easily shocked. You might just have the best laughs you’ve
had in years. Robert Downey, Jr. gives another amazing performance,
this time playing a black. It’s an action comedy about a group of
self-absorbed actors who set out to make the biggest war film ever.
Generally favorable reviews.
Body of Lies: US Action/ Drama/ Thriller – Leonardo DiCaprio and
Russell Crowe. I liked this film very much – it’s smart and tightly
drawn, and has a throat-gripping urgency, with some serious insights.
Coming Soon: Thai Horror – Another bloody scream-fest, this one is
about a projectionist who decides to help a friend illegally film a
newly released horror movie, with dire consequences.
Queens of Langkasuka / Peun yai jom sa-lud: Thai Adventure/ Fantasy
– Nonzee Nimibutr’s 200-million-baht historical action-fantasy is for me
an entertaining Thai blockbuster – big stars, loads of special effects,
lavish costumes, and an exotic seaborne setting. Sumptuous in
production design, I think it has the nostalgic charm of classics like
Sinbad the Sailor, plus it has a truly exhilarating sea battle at
the end.
Max Payne: US Action/ Thriller – Starring Mark Wahlberg. Based on
the popular interactive video game, it’s the story of a maverick cop
determined to track down those responsible for the brutal murder of his
family. Basically for fans of the game and action movies, it
nevertheless has some stylish visuals in a somber mood, which I really
enjoyed looking at, and an intense performance by Wahlberg. Generally
negative reviews.
Twentieth Century Boys: Japan Fantasy – A live-action film based on
a wildly popular manga comic. The main character is Kenji, who once
aimed to be a rock star but now works at a convenience store. He
stumbles upon a cult behind a series of mysterious incidents that have
bizarre similarities to a book that Kenji himself wrote as a child.
Sex Drive: US Comedy – An eighteen-year-old sets out on a cross
country drive with his best friends determined to lose his virginity to
a red-hot babe he met on the Internet. Randy and raucous.
Scheduled for Nov 27
Teeth: US Comedy/ Horror – Directed by Mitchell Lichtenstein
(son of Pop artist Roy). Dawn, a high school student, works hard at
suppressing her budding sexuality by being the local chastity group’s
most active participant. A stranger to her own body, innocent Dawn
discovers she has a toothed vagina when she becomes the object of
violence. More enjoyable than I thought it would be, it is still pretty
sick and unpleasant, and with the number of appendages that eventually
litter the ground, I think Teeth bites off more than it can
chew. Mixed or average reviews.
Twilight: US Horror/ Romance – A teenage girl, always a bit
different, falls in love with a mysterious and dazzlingly beautiful
vampire.
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