Wry & Dry

A momentous week. Fat chance. Tontine: more than a pillow.

A momentous week

After months of anguish, trials and nervousness, Wry & Dry was this week confronted by the final result.  He knew there would be tears of pain.  And tears of joy.  And there were.

Italy has failed to reach the World Cup (for soccer) for the first time in 60 years!  Mama mia!

Readers will know that W&D has often said that the World Cup is the only thing for which the peoples of the Apennine Peninsula come together as Italians.  So, those peoples will, until 2022, now resume their tribal (i.e. regional) loyalties: Tuscan, Sicilian, Calabrian, etc.  

The four-time winners couldn't overcome Sweden in the play-off for a place in Russia in 2018.  The government has ordered an inquiry.  Expect heads to appear on spikes at the city gates.

PS: Australia made it to the World Cup, defeating the impoverished Central American republic of Honduras [1].

Venezuela: don't say W&D didn't warn Readers

With as much certainty as rain at the Boxing Day Test match, Venezuela's slide to fiscal apocalypse is almost complete.  Ratings agencies have now declared that it has officially defaulted on its debts.  Predictably, Russia (owed $9 billion) and China (owed $28 billion) have deferred their interest entitlements, to 'allow time for restructuring'.  

But it's not yet clear that bondholders (owed over $100 billion) will force their hand: Venezuela may be too big to fail.  Better to eke out something from the twitching fiscal Venezuelan corpse than to sulkily walk away. 

Readers will know that in 1998, the year before the recently deceased President, Hugo Chávez, came to power, Venezuela was a wealthy country (massive oil production and world's largest reserves).  But his absurd socialist policies bequeathed to his equally ideologically stupid successor a failed nation-state.  Russia and China will now reap the rewards of their fellowship by being gifted oil assets to offset their loans.

Bondholders will be lucky to get some interest.  And as the bonds are trading at 25 cents in the dollar, their capital is mightily diminished.

And the people of Venezuela will remain impoverished.

Much like those of another riches-to-rags country, Zimbabwe (see more, below).

Canberra descends below the politics of [insert your choice of facile country here]

Readers will recall that the High Court ordered the resignation of single-digit-IQ ('SDIQ') One Nation Senator Malcolm Roberts.  Senator Roberts' risible but failed attempts to persuade the High Court that he wasn't a dual citizen will be forever etched in the annals of that august court.  Roberts' replacement had to be the next in line on One Nation's Senate ticket.  And that was Fraser Anning, a farmer and former publican. 

The new Senator has already set a new record.  The 19 primary votes he received at the last election is the lowest ever recorded for a member of parliament.  

However, before Readers swoon in astonishment, W&D reassures that his support was widespread.  His 19 votes were recorded in 19 different polling booths across Queensland.  For example, he received one vote in the Kakadoon polling booth (Mt Isa) and another at Waterford West, near Brisbane.  The polling booths are 1,823 kilometres apart.

And Senator Anning is now also poles apart from his now former leader, the SDIQ One Nation Leader, Pauline Hanson.  Immediately after being sworn in by the Governor-General on Monday, Senator Anning resigned from One Nation, to 'consider other options'.

One nation can of worms

W&D wishes that Ms Hanson would also consider other options.

Ah, Queensland + One Nation = Ridiculous one day, madness the next.       

Jacqui, don't go!

News that Tasmania's very own SDIQ Senator, Jacqui Lambie, is a dual citizen and thus is resigning is a traumatic moment for W&D.  That's one less risible source of words-strung-together-in-the-hope-that-a-sentence-is-formed.

W&D remembers this doozy when asked on a Hobart radio station (107.4) on the attributes of the perfect man, she replied (impolite words warning!), "They (sic) must have heaps of cash and they have to have a package between their legs.  They don't even need to speak."

Because, of course, she will speak for him.  Err...  they.

Readers will recall that Ms Lambie was originally a Senator for the now almost defunct Clive Palmer and completely defunct Clive Palmer Party.  At least Ms Lambie was authentic.

Deepak, W&D's Uber driver...

...was talking about tontines.  One of his fellow Uber drivers had suggested that he invest in a tontine.  But Anjali, his lovely wife, had told him that tontine was a brand of pillow.  Could W&D help?

Of course, responded W&D, enthusiastically.

Tontine is indeed a brand of pillow (owned by Pacific Brands), W&D assured Deepak.  But it also refers to a clever investment scheme devised by Lorenzo de Tonti, a 17th-century Italian banker [2].


Essentially, investors pay capital into a common pool, which is invested.  The investors receive dividends or income based on their share of the pool plus the performance of the investments.  When an investor dies his/ her share is divided up among the surviving investors.  The last person alive receives all of the pool. 

W&D compared a tontine to a more traditional retirement product, an annuity.   Deepak knew that there are two problems with annuities.

Firstly, if someone dies the day after he/she buys an annuity, the insurance company walks away with the cash.  In a tontine, that money passes on to help fund other people's retirements. 

Secondly, an annuity is very expensive, as the insurance company that backs it has to set aside a lot of money in reserves — just in case people live longer than expected, or the market crashes.  A tontine is like an annuity in which the middleman has been removed.  

It does away with all that overhead, so more money is available to the retirees. 

So why, W&D asked Deepak, the interest in a tontine investment?  Well, he liked that it protects against longevity risk and there is a bit of a lottery about it.  He was happy that he would outlive other investors.  And leave a cash pile to Sachin, his cricket-loving son.

W&D looked at the website of the tontine: And, yes, it is a tontine.  But it won't launch until late 2018.  And it has a whiff of crypto-currency about it.  And there is, so far, no prospectus.  So small matters such as fees and certainty about payment (especially to the last survivor) remain unknown.  And the name of the company, Tontine Trust Limited, suggests a trust.  Err, no.  The fine print says it's not a trust and the company doesn't offer trustee services in Gibraltar (its domicile) or anywhere else. 

W&D's advice (general advice only) to Deepak was caveat emptor.

Millennials: all rights and no responsibility

W&D has increasingly thought that millennials (so-called generation Y) are a bunch of lazy, self-centred, spoiled brats, who want all of the rights to life but none of the responsibility.

Well, whether folk voted in the Same-Sex Marriage plebiscite was not consistent across age groups.  

The millennials were noticeable by their absence.  A full 25% failed to vote.

Millennials vote3

Overweight?  Who? Me?  Err, yes.

W&D's eyes nearly popped out of their weary sockets.  63% of Australian's are fat [3].  Oops, sorry that's politically incorrect.  They're 'overweight'.  And almost 30% are obese [4].

Fat people

W&D remains curious as to why the French and Italians, two peoples who really enjoy food and wine, have such relatively low overweight populations.  

Maybe it's about time that Croesus Turnbull got on to the front foot and started announcing some policies.  Such as how to deal with this epidemic.

Fat chance.

Extra energy to chew

Q.  How do you know if there's been a coup? 

A.  There is a tank on your front lawn.

And so the good folk of Harare (formerly Salisbury), the capital city of Zimbabwe (formerly Rhodesia) awoke this week to see tanks rumbling around the streets.  

Zimbabwe coup

It looks as though that megalomaniac president of Zimbabwe, Robert Mugabe, aged 93, has been ousted by his own supporters, with the support of the army.  These folk didn't relish the transfer of power to Mugabe's wife, Grace (aged 40 years younger than her husband).

Readers will be aware from various W&D articles over the years of how Mugabe transformed this country from Africa's richest nation to one of its poorest.  And that, sadly, former Australian PM Malcolm Fraser not only help ensure Mugabe's original ascension to power but also actively supported him once he was in power.  Fraser's generosity of spirit, so apposite with his support for Vietnamese refugees after the war, was disgracefully misplaced in his support for Mugabe.  

Not that matters in Zimbabwe will now improve.  The expected new president is the former vice-president, Mr Mnangagwa, nicknamed The Crocodile.  And he is as evil as Mugabe.  And wealthier: Mnangagwa amassed 'extraordinary wealth' during Zimbabwe's 1998 intervention in the gold- and the diamond-rich Democratic Republic of Congo.

Sigh.  Plus ça change, plus c'est la même chose. [5]

But wait, there's more. W&D sees that the chaos that is Zimbabwe is an opening for it becoming a vassal state of China.  As remote as that might seem.  The man who led the coup, General Chiwenga, has spent a lot of time in Beijing recently.  It's a long-term thing.  Just sayin'.

Bitcoin: so, this is not a bubble...  Err, well it is.

The price of Bitcoin has fallen fell 25% since last Friday.

Bitcoin song

Say no more.  But see below for how bubbles work.


Be careful what you wish for

W&D wishes to give some gratuitous advice to the Leader of the Federal Opposition, William Shorten, concerning the upcoming by-election in the federal seat of Bennelong. Readers will know that the sitting member, former tennis great John Alexander, resigned because he was a dual citizen and is re-standing.

Readers will also know that the Labor Party has selected Kristina Keneally as its candidate.  Here's the rub.

Kristina is a former NSW premier, hastily installed to succeed the hapless Nathan Rees.  She was installed by the corrupt and now jailed Labor Party power-broker, Eddie Obeid.  She promoted two of Obeid's allies, both of whom were later found guilty of corruption and one is also in jail.  She led Labor NSW to its worst ever electoral defeat. 

So what? W&D hears Readers ask.  Well, W&D had lunch with Ms Keneally some years ago, and was, if not captivated, certainly impressed with her presence.  She is one of the most charismatic and charming persons W&D has ever met.  And will charm the socks off any voter she meets.

The problem for Shorten is two-fold.

If she loses, he has egg on his face for trying to parachute a glamour candidate into a marginal seat.  Readers will recall former Queensland Premier Peter Beattie failing to win the federal seat of Forde for Kevin Rudd in 2013.

If she wins, as well she might, Shorten will have at his side a significantly more popular and charismatic person, who will have aspirations for leadership.  And she will be well supported.  She is a proven puppet (which apparatchiks like); is amazingly telegenic (so useful these days); and has none of the baggage that federal leaders carry (voters are turned off, completely).

Be careful, William.

Yesterday was...

Beaujolais Nouveau Day, one of the most important days in France's cultural calendar.  Readers will know that Beaujolais is a very young wine, on the shelves six to eight weeks after harvest.  It is made from the Gamay grape, must come from the Beaujolais AOC and be harvested by hand. 

Notwithstanding that Beaujolais is everything a wine snob hates, it is amazingly popular, with some 28 million bottles produced each year.

W&D is passing this information to Readers so they will know that if W&D doesn't make it to the presses next week, Le Beaujolais Nouveau is to blame. 


Australia's unemployment rate fell to 5.4%, the lowest in 5 years.

NAB's business conditions survey surged in October, surpassing the previous peak of 2006.

And, to soothe your troubled mind...  


Last words...

"I can hardly convey how exciting it is for those of us directly involved in its sale."  

-   Alan Wintermute, an art specialist at Christie's, New York, on the sale of a painting, believed to be by Leonardo da Vinci, for US$430m, comfortably a world record.

W&D bets they are excited.  The buyer will pay about $50m in commissions, on top of the purchase price.

First Samuel client events calendar




See below       
Chief Investment Officer Dinners
Invitations Sent
Wed-22-Nov Donovans, St Kilda Lunch & Dinner (FULL)
Tue-28-Nov Elyros, Camberwell Filling 
Wed-29-Nov Bottega, Melbourne CBD FULL
Sometimes cancellations occur, so please call Jess if you now wish to attend.
2018 Events  (Invitations not yet sent)


Eat Street - food & wine fest



NGV Winter Masterpieces Exhibition

Masterworks from Moma (New York)



Forum - guest speaker TBA


Some lightly salted absurdities from all over...

At the extreme left-hand end of the Bell Curve

It’s legal to drink beer in German movie theatres.  And a thirsty moviegoer wanted to open his bottle in a cinema last Monday night in the northwestern German town of Osnabrueck.

But a traditional bottle opener was not something he had with him.  The only possible item was a... pepper spray canister.

Sadly, the canister failed to open the bottle.  But the attempt opened the canister.  Outcome: 200 cinema-goers treated.

(NY Post)  

The name of the movie was not revealed.  Perhaps Dumb and Dumber?  

Guess what happens next 

Cheyenne Amber West, 25, a waitress from Fort Pierce, Florida, was at the self-service checkout at the local Walmart.  She was buying an HP computer, video game controllers and other electrical equipment.  Total value was $1,825.20.  She rang up a total of what amount?

a.  $1,825.20.  She is an honest woman;

b.  $18,252.00.  She has thick fingers;

c.  $182.52.  She has thick fingers; or

d.  $3.70.  Her fingers slipped.

Close.  But no cigar.  The correct answer is d.  Charges include Felony Grand Theft, Retail Theft.

(Daily News)  

Take your hat off in court

Juan Jose Vidrio Bibriesca, 43, was in court in Colorado standing before the judge.  He was there on felony drug charges.  The judge told him to remove his hat.

As he did so, a square folded paper fell out.  Sadly for Juan Jose, the court clerk picked up the paper, unfolded it and found it contained cocaine.

He was walked over to the county jail and charged with narcotics possession.  Further investigation showed he was an illegal immigrant, was on parole, etc, etc.


Juan Jose clearly had been listening to Joe Cocker [6]. 

Have a wry and dry weekend



[1]  Honduras has a population of just 9 million, is about half the size of Victoria and has per capita GDP of $5,500, some 10% of Australia's.  

[2]  Lorenzo de Tonti, was an exiled Neapolitan banker living in France, who in 1653 conceived a plan to replenish the royal treasury, depleted by the Thirty Years’ War.  His proposal fell flat. He ended up in the Bastille after publicly criticizing the government’s decision, and died around 1684.

But he was vindicated: Five years later, the government changed its mind and issued the first French national tontine.  Before long, tontines caught on across Europe, prompting the English mathematician Edmund Halley (of comet fame) to draw up actuarial tables in 1693 to help potential investors assess the wisdom of buying into tontines. And tontines earned high marks in Adam Smith’s “The Wealth of Nations.”  

In 1793, the founders of the New York Stock Exchange settled into their brand-new digs on the northwest corner of Wall and Water Streets: the Tontine Coffee House, named for the business deal that paid for the structure’s handsome bricks and mortar.

[3]  Body Mass Index greater than 25.

[4]  Body Mass Index greater than 30.

[5]  'The more things change, the more they stay the same'. An epigram by Jean-Baptiste Alphonse Karr in the January 1849 issue of his journal Les Guêpes (“The Wasps”). 

[6]  "You Can Leave Your Hat On," sung by Joe Cocker, written by Randy Newman.