HEADLINES [click on headline to view story]:

Money matters

Snap Shots

Modern Medicine

Heart to Heart with Hillary

Let’s go to the movies

Money matters:   Graham Macdonald MBMG International Ltd.

Does your pilot have a parachute?
For many investors 2008 was a year they would like to forget in a hurry. But with 2009 bringing continuing uncertainty in the banking and investment sectors, those with hard-earned savings in funds which have had their value decimated are wondering, “Should I bail out? And where is my parachute?”

Falling value of investment 1929-1932

It is one of the ironies of our times that when we see the world in what could be the deepest recession in recorded history, the investment marketing industry seems to be booming.
Ironic, but perhaps not so surprising.
If the lifetime savings you invested in what appeared to be ‘blue chip’ solid investment funds now seem to be far less likely to support you through your retirement, then seeking advice on how to handle this makes sense.
But there are clear signs that this recession has a different quality to many others we have experienced before. This is the reality that world economists, bankers, politicians and ordinary people are all struggling to come to grips with.
If your portfolio has been hammered by the markets in the last six months, what should you do? Does it make sense to wait it out? Surely the market will correct itself?
How do you repair your portfolio?
In our opinion, waiting it out and doing nothing could be possibly the worst option you could follow.
Last year, funds which retained their discipline in maintaining a truly balanced and diversified portfolio, and actively managed their positions, avoided much of the losses suffered by others and significantly outperformed the market indexes. Active portfolio and asset management does not mean the investor should throw away a long term investment strategy. But the best strategy is to remain diversified and balanced, while retaining the flexibility to move actively within this framework.
So just how do you repair your portfolio?
The first step is to look honestly at how you got to this position. Did you receive the right advice? Did you understand the nature of the investments and the risks attached to these? Are you satisfied with how your advisor and funds have performed?
Then research the commentators and analysts who saw the turn coming and consequently dodged the bullets. People like Marc Faber of the ‘Doom, Boom & Gloom Report’, ‘Black Swan’ author Nassim Taleb, NYU Professor, Nouriel Roubini, and the portfolio managers we use, Martin Gray and Scott Campbell.
Next, take a look at your portfolio as if you have never seen it before. Forget past performance and ask yourself, “If I was starting out today with a clean sheet, would I buy equities? Is it a good time to buy commodities? Bonds? Are there more compelling opportunities in venture capital?”
Selling at a loss may feel like admitting to a mistake, but we don’t know a problem that got better by ignoring it. There’s no shame in admitting you may have made a mistake in your past choices. In our experience, people who acknowledge mistakes are far less likely to repeat them.
One of the most successful portfolio managers in Asia, Martin Gray said it all in a recent interview.
“You have to be prepared to admit that you made a mistake and get out… the themes that I am following are on a 1-3 year basis. Some may be shorter term than that, but I am not a trader. At the same time, we’re not wedded to any particular benchmark or asset allocation model or sector. I roam where I can get the best return for the fund.”
Certainly in the past it has paid to admit your mistakes - when stock markets have fallen for one year, they have tended to experience multi year falls. Since the inception of the S&P Index there has only been one major (i.e. in excess of 20%) single year correction - 1937. Every other major calendar year drop has been part of a protracted sequence. If 2008 turns out to be a single year correction, it would be the largest ever recorded. Historic precedent for this situation indicates 3 more years of pain and the losses of 2008 may be less than half way down to the bottom.
No one can control the economic world we live in, but you can control how you respond to it, and make investment decisions that are relevant to the changes currently underway.
There is no doubt that the change we are experiencing at the moment brings with it opportunities for optimizing returns. The trick is to be brave enough and flexible enough to think beyond your past decisions, and perhaps beyond your past advisors, to take positions which reflect the new realities of the market.
This is why we favour active portfolio repair in 2009!

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]

Snap Shots: by Harry Flashman

Differences between sharp and soft

Two common words in photography are ‘sharp’ and ‘soft’, and photographically speaking there is an enormous difference between them. Those terms are the ones reserved for describing whether the final image is well focused. We speak about ‘sharp’ focus and ‘soft’ focus and everyone knows what is meant.
While ‘soft’ focus is not all that difficult to end up with, and you can buy after-market filters to do this, ‘sharp’ focus is a lot more difficult to attain, so I thought it might be worthwhile looking at what you have to do to get pin-sharp photographs.
Forgetting all about Auto-Focus (AF) problems and camera shake for the moment, the deciding factor on whether or not you get sharp pictures will depend upon the quality of the optics in the lenses you use. Unfortunately quality costs money - like most consumer items. “You get what you pay for” works in photography just the same as it does anywhere else!
I came across this fundamental truth when I was becoming despondent with the sharpness of my final prints many years ago. Even putting the camera on a tripod had not helped. Asking around in my photographer acquaintances led to my being loaned a very battered and well used journalist’s Nikon FM2N, with Nikon lens.
I took the “old” camera away and shot a roll of film. Off to the darkroom and guess what? Every one as sharp as a tack. I had learned an important lesson and went out and purchased some second hand Nikon equipment, and have never regretted it since. In fact, old FM2N Nikons were still part of my camera equipment till very recently.
So what was the difference? Well, the end result will always rely on super sharp optics in the lens department. If they are not spot on, neither will your photos be spot on. The actual exposures are close enough for just about any camera these days with the latitude in the films being so wide, so the other differences now will come down to ease of use, or user friendliness. Simple mechanical cameras, like the FM2, have simple operations too. These new electronic cameras with their “menus” and other operations I do not consider to be as user friendly. It is easier to push a lever, surely. However, perhaps it might just be that I am resistant to change!
The important lesson from all that is that to get good results you need a camera that has good optics. There are plenty on the market these days, and although the Nikon brand may be my favorite, there are other manufacturers which have equally as good quality glass at the front. Unfortunately, the results from these great cameras can become poor if you put a cheap “after market” lens on it. Good lenses are expensive, but the end result is always worth it.
Having mentioned AF problems earlier, a few words on this again. While AF is now almost 100 percent universal, it still is not 100 percent foolproof. One of the reasons for this is quite simple. The camera’s magic eye doesn’t know exactly what subject(s) you want to be in focus and picked the wrong one! The focussing area for the AF system is a small circle or square in the middle of the viewfinder, so if you are taking a picture of two people two metres away, the camera may just focus on the trees in the far distance that it can see between your two subjects. Those trees are two km away, so you get back a print with the background sharp and the two people in the foreground as soft fuzzy blobs. The fix is to focus on one person, use the ‘focus lock’ and recompose the picture.
Finally - camera shake. Cameras are supposed to be operated with two hands, not one. The practice of holding the camera in one hand and raising one, two and three fingers on the other can only lead to camera shake. Don’t do it. If you must tell your subjects that you are about to trip the shutter, do it by saying the words “one, two, three” - not by waving your fingers in the air.

Modern Medicine: by Dr. Iain Corness, Consultant

High maintenance bodies

As we get older, there are many physical changes that occur. I was reminded of this by one of the wags at the informal Gentlemen’s Club I attend on Saturday mornings, who said, “You know you’re getting old when someone compliments you on your alligator shoes - and you’re barefoot!”
Yes, as your body’s skin gets older, it starts to show it. It becomes less elastic, folds start to form everywhere, it gets thinner and tears easily, and small bruises form just below the top layer. Women try and counteract this aging process with all kinds of creams, but quite frankly, I think they are wasting their (husbands?) money. You can rub ‘moisturizing’ cream into the skin as much as you like, it will remain impervious to water (otherwise you would get waterlogged having a shower, wouldn’t you). No, ‘moisturizers’ work as well as ‘vanishing’ cream dies when rubbed into the pregnant single girl’s swelling belly. A remedy tried many times and failed just as often.
Unfortunately, as we get older, this body of ours tends to become a very high maintenance item. Unless we have medically planned for our future, we (that’s you), will find that it becomes an expensive item.
Take for example, your weight. Eating is fun and pleasurable, but too much of the good thing and you become overweight. When you are 30 or 40 you can joke about the beer belly, but when you are 50 and 60 and you have become diabetic and your arteries are blocked, you are in for some expensive medications for the rest of your life, some life saving cardiac surgery and you may even need to have your lower leg amputated, so throw in the price of a wheelchair into the final package.
Another item that we watch changing as we get older is our blood pressure. The old adage used to be that your blood pressure should be your own age plus 100. Like many old adages, that was total nonsense too. A 60 year old man should not ignore a BP (systolic) of 160. The cardiologists and the kidney specialists will tell you that you should maintain your BP at around 125/70 for all your life if you don’t want to have cardiac and renal problems as you get on in years.
One other aging factor that we should look out for is cancer. We know the majority of cancers develop as we get older. Should you wait for them to come, and then try to stop the progression? Stopping the cancer with expensive surgery and even more expensive chemotherapy, or stop putting ourselves ‘at risk’ in our younger years? This ‘at risk’ behavior means smoking, of course. Not just for lung cancer, but for all cancers. The expensive habit of a lifetime becomes a very expensive end of your lifetime. Why do it? It makes no sense at all. There is no ‘justification’, I’m sorry.
Unfortunately, our bodies are very much like our cars. If you look after your transport, have it regularly serviced, replace the bits that are wearing out before they totally fail and then damage the rest of the car, then your vehicle will last for many years and give very close to ‘as new’ performance for as long as you keep it. The costs involved in that preventive maintenance are very low compared to having to replace major parts.
Using that analogy on your body, if you look after it, it can also give you good service. Preventive maintenance by having regular check-ups makes sense. Look for the warning signs and correct the problems. You can even screen for ‘cancer markers’ such as alpha-Fetoprotein (AFP), Carcinoembryonic antigen (CEA), Prostate specific antigen (PSA), Pap smears and colonoscopies. If you are a young woman you can even immunize against Human Papilloma Virus.
However, some of the main items are easy to monitor such as weight (your own bathroom scales will give you ‘free’ readings) and Blood Pressure monitoring can be done at the Bangkok Hospital Pattaya’s check-up booth on the first floor of the Royal Garden Plaza (and that’s also free).
Isn’t it time you gave your body the once-over?

Heart to Heart with Hillary

Dear Hillary,
Here’s a different question for you this week. I haven’t been ripped off, lost gold chains or motorbikes, haven’t thrown parties in the village that everyone attends, including the village buffaloes (though I think sometimes that the families look upon us as the buffaloes, while the daughters look at us as the ATMs). It’s nothing like that, it’s a question about car hire. I hope you can steer me in the right direction. My (current) girl wants to go upcountry again and tells me that her cousin has a car I can rent, and how he will give us (me) a good deal. How do I tell if it is a good deal or not?
Harry the Hire

Dear Harry the Hire,
I wish every question was as easy to answer as yours, Petal. There is only one really important factor in hiring in Thailand, and that is that the vehicle has to be fully insured - as a rental car. Some people will tell you that the vehicle has insurance, but it is only for the owner as the driver. There are also problems with damages to other cars, third party property and so on, as well as damage/death cover. Most of these small hirers will also want to keep your passport as security. At your own risk, my Petal!
While the cousin might have a fairly new vehicle, you need to unscramble the insurance queries, which can be hard when your negotiator is his cousin! Who may also be getting a backhander for her trouble! There is only one safe way, and that is to rent from a large reputable firm that can show and explain their insurance policy. There are the international majors and some local ones. Your expat clubs can advise on who they are. Don’t hire from somebody’s relative, or from the side of the road.

Dear Hillary,
My wife’s mother is coming down from the up-country village, to spend a few days with us. I have not seen her since we got married and I was wondering what I should call her? “Mum” sounds pretty silly to me, as I am older than she is. What do you suggest I should call her to be polite? I really don’t want to offend. Another problem is she doesn’t speak English and my Thai is almost non-existent.

Dear In-law,
This is the easiest one I’ve had all year, Petal. You ask your wife! Like all Thai wives, she will know what is best. About everything! Relax. Really all that will be expected is that you give her a wai and take it from there.

Dear Hillary,
You seem to have the answers for most things, so I hope you can help, as you have your feet on the ground in Thailand, while I am in the US. This may find this a strange request, but I am a retired American interested in Buddhism and wondered if it would be possible that on my next holiday to Thailand I could join a monastery. I would only have two weeks but imagine that in that time I could at least get the basics of Buddhism. Is this possible? I don’t mind where in Thailand that I would go as I am interested in the study, not the geography or tourism side. I have always been impressed watching the orange robes going along the streets with their begging bowls in the mornings.

Dear Herbert,
There is no such thing as “strange requests” in Hillary’s letter box these days! I think I’ve seen them all. Now, to yours. If you want to understand the basics of Buddhism, you have to start long before you get on the plane to come to Thailand. You are certainly not going to pick it up in two weeks in a Thai speaking monastery, unless you have perfect Thai. To begin with, have you looked to see if there is a Buddhist temple in your region in the US? Discussions with the monks there will assist you in your quest. Monks in America can generally all speak English, while in the temples here, they naturally speak Thai and you would be lucky to find someone fluent in your language.
I would recommend that you get the following books before going much further, “Buddhism Explained” (ISBN 974-7047-28-4) by Khantipalo Bhikkhu, “Phra Farang, An English Monk in Thailand”, by Phra Peter Pannapadipo, (ISBN 974-202-019-1) and “The Good Life. A guide to Buddhism for the Westerner” by Gerald Roscoe, (ISBN 974-8206-56-4). Read these before ordering the saffron robes, Petal.

Dear Hillary,
So you got another of those stupid letters from the Mistersingha person. Why do you keep printing them? The only person who is impressed with them is himself. I can see he is a nuisance to you, so just don’t print and he’ll stop. Or do you need him to fill the space?
Sam the spaceman

Dear Sam the spaceman,
Yes, Sam, there are some days that there is a little space to be filled and Mistersingha does it nicely. There are, however, many of his epistles that don’t make it to the printed page, don’t worry. Hillary can take care of herself, but your kind thoughts are appreciated. I’ll let you know if I need a ‘contract’ taken out.

Let’s go to the movies: by Mark Gernpy

Now playing in Pattaya
Valkyrie: US/ Germany Drama/ History/ Thriller/ War – A well-crafted, thinking-person’s action movie about the attempt to assassinate Adolf Hitler by rebel German army officers in 1944, starring a restrained and excellent Tom Cruise as the aristocratic German officer who led the heroic attempt to bring down the Nazi regime and end the war by planting a bomb in Hitler’s bunker.  Directed by Bryan Singer (X-Men, Superman Returns).  I was impressed by the supporting cast that includes Bill Nighy (fresh from his chores as lead vampire in Underworld: Rise of the Lycans), Tom Wilkinson, Terence Stamp, and Kenneth Branagh.  Actually, I think the less you know about the details of the story as you go in the more interesting it will be.  Mixed or average reviews.
US Action/ Sci-Fi – Full-bodied Sci-Fi escapism that should satisfy your cravings for both action and Norse mythology in one fell swoop.  During the reign of the Vikings, Kainan (James Caviezel), a man from a far-off world, crash lands on Earth, bringing with him an alien predator known as the Moorwen.  Though both man and monster are seeking revenge for violence committed against them, Kainan leads the alliance to kill the Moorwen by fusing his advanced technology with the Viking’s Iron Age weaponry.  Mixed or average reviews.
Street Fighter: The Legend of Chun-Li:
US Action/ Sci-Fi – Adapted from the popular series of “Street Fighter” video games first released in 1987, followed by a sequel in 1991.  Undercover Interpol agent and female fighter Chun-Li (Kristin Kreuk) seeks justice after she discovers that her father has been murdered.  Some location shooting in Bangkok.
The Curious Case of Benjamin Button: 
US Drama/ Fantasy/ Mystery/ Romance – with Brad Pitt, Cate Blanchett, Tilda Swinton.  The extraordinary tale of a man, born elderly in 1918, who ages backwards through the 20th century.  I don’t see how anyone can really like this, but I seem to be in the minority.  It’s utterly nonsensical, so I couldn’t get involved, even at 166 mins.  Great makeup and sense of time and place – worth seeing for these alone!  The screenplay is by Eric Roth, who wrote Forrest Gump, which this reminds me of. Generally favorable reviews.
My Bloody Valentine 3D:
US Horror/ Thriller – It’s an unpretentious gory and senses-assaulting slasher film, and an effective mix of old-school horror stylings and modern 3D technology.  I’ve seen the 3D version, and the effects are good.  Congratulations to the cineplexes here for getting the glasses and showing us what it’s really like!  Rated R in the US for “graphic brutal horror violence and grisly images throughout, some strong sexuality, graphic nudity, and language.”  Mixed or average reviews.
US Action/ Thriller. The deadly world of “psychic espionage” where artificially enhanced paranormal operatives have the ability to move objects with their minds, see the future, create new realities, and kill without touching their victims.  It has a convoluted script, and despite director Paul McGuigan’s visual flair, it’s really hard to follow.  Generally negative reviews.
Underworld: Rise of the Lycans:
I thought this quite terrific of its kind, and for the most part an amusing and enjoyable foray into a mythic medieval world, except for the excessive whippings.  Rated R in the US for bloody violence and some sexuality.  Mixed or average reviews.
US Drama/ Action – Only mixed or average reviews, but I thought it riveting, and I highly recommend it for anyone who wants to see something substantial and provocative as well as exciting.
Germany/ UK Adventure/ Family/ Fantasy – Fantasy fans should love this.  It’s a vast undertaking with a lot of thought and artistry going into the creation of an entire fantasy world with its own very unique rules, and I found the attention to detail enjoyable.  An excellent cast including Brendan Fraser, Paul Bettany, Helen Mirren, and Jim Broadbent.  Based on the Inkworld series of children’s novels by Cornelia Funke, detailing the adventures of bookbinder and his 12-year-old daughter, who is a voracious reader.  He is a Silvertongue, a person with the rare ability to bring the characters in a book to life simply by reading the text aloud.  Mixed or average reviews.
A Moment in June
– Thai Drama/ Romance – Well-received Thai drama set partly in Chiang Mai and Lampang.  Directed by O. Nathapon, who is also active in theater and draws on his theater experience to devise an impressive crossover of cinema and stage through a play-within-a-film.  Three couples – gay, elderly, and fictional – engage in a melancholy dance of indecision and regret.
Luang Pee Kub Phee Ka Noon:
Thai Comedy – A swindler hides out in a monastery by becoming a monk.  With the popular Mum Jokmok and the usual stable of TV comedians.
Confessions of a Shopaholic
– US Comedy. An unfunny movie shrilly told, and probably the most ill-timed and appallingly insulting movie in recent memory.  Generally negative reviews.