Wry & Dry

It's now the G-2. Banks still don't get it. It's 1984 all over again.

It's now the G-2

Really.  W&D means, really.  What's going on?  The gracious Japanese government hosts a wonderful talk-and-food-fest for 19 world leaders and a variety of hangers-on.     

And what happens?  It becomes the G-2.  Seventeen world leaders and a variety of hangers-on had their photo op with either G-1 or G-2: I-Wanna-Vacation-in-North-Korea-Trump or Emperor Xi Jinping.  But otherwise might have stayed at home. 

It was all about G-1 and G-2.  And their desire to consign global and free trade to the shredder of history, by allowing pride to obstruct sensible outcomes.

Cartoon G 1 G 2

Let W&D observe that the complaint of I-Wanna-Win-The-Trade-War-Trump about China and trade is justified.  But let W&D caution the world, using the old stock-market warning of 'the stock-market can remain irrational for longer than you can remain solvent'.

In other words, W&D fears that these two leaders can remain stubborn and proud for longer than each economy, and others, can fairly bear.  Gird your loins.  So to speak.

The Chinese have a reputation for playing the 'Long Game', even at the expense of its own citizens.  And the every-Chinese-is-taught-at-school-about-the-humiliation-of-the-'unequal treaties'-[1]-factor will ensure that Emperor Xi will not back down.

I-Wanna-Win-The-Trade-War-Trump is concerned about getting four more years of free accommodation in Washington and giving his daughter every opportunity to fill up her passport with stamps of countries she wouldn't otherwise visit.  "Hey, Dad, look at the pretty stamp I got in my passport from a country called LAX.  Err, where is LAX?"

So he will not back down. 

Sigh.

[1]  The name given by the Chinese to a series of treaties signed with Western powers during the 19th and early 20th centuries by the Qing dynasty, after military attacks or military threats by foreign powers.

The banks still don't get it

The Chief Teller of the Reserve Bank has ignored W&D and other lateral thinkers and cut its target cash rate by 0.25% points.

And, with the exception of ANZ, the banks have passed on less than the full 0.25%.  But wait, there's more.  The ANZ and NAB will take 10 days to pass on the rate cut to borrowers, Westpac 14 days and CBA 21 days.

So, bank CEOs, what's going on?  Need to get back to turning left on boarding the A380 to Europe? (Actually, on the A380 it's take the ramp upstairs).  This trousering of dosh by unnecessary delay in lowering rates is just plain shabby treatment of customers.

In days of old, you'd be taken to the pillory and locals would lob tomatoes at your shameless faces. 

Is there a better way?

Yes, unemployment has blipped up and the economy slowing a little (see more, below).  But how is lowering interest rates going to help an economy the inhabitants of which are in debt up to their gills?

The Chief Teller is correct in one aspect, though. "We should not rely on monetary policy alone." The time is long overdue for the government to undertake reforms to improve productivity.  The governments of The Abbott and Croesus Turnbull spent too much time fighting internally and too little on such matters as sensible industrial relations reforms (well, with Senators Eric Abetz and then Michaelia Cash in charge - inaction did not surprise), reduction in bureaucracy and micro-economic reform (Frydenberg did some good stuff, though).

Cartoon bureaucracy reduction

It's time for Jimmy Morrison and his government to worry less about the hour the budget goes into surplus and more about showing some testicular fortitude about serious reform. 

Continually cutting interest rates at these levels hasn't worked.  As one commentator put it on Wednesday, "doing the same thing over and over again and expecting a different result is the definition of insanity" [2].

[2]  One of those witticisms that cannot be attributed to Churchill.  Originally said by Albert Einstein.   

New (fiscal) year musings:  Nineteen Eighty-Four all over again  

George Orwell's dystopian novel Nineteen Eighty-Four and John Stuart Mill's philosophical work On Liberty should be required reading for all Australians.    

Readers will know that Nineteen Eighty-Four is about the risks of government overreach and repressive regimentation of all persons and behaviours.  And that On Liberty emphasises the three basic liberties of individuals. 

Which brings W&D to his point.  A number of Readers have asked for W&D's views on the Israel Folau controversy.  By way of reminder, W&D's views have already been published. 

Firstly, he has already noted Qantas' close relationship with an airline the owner of which cheerfully executes homosexuals.  Qantas' virtue signalling is profitably selective.

Secondly, W&D observed that, essentially, only Christians have a concept of hell.  And therefore only Christians can possibly be offended by Mr Folau's comments.  But, as Christians, they are bound by Christ to forgive.  So, let's move on. 

However, the ARU, clearly in awe of Qantas, its major sponsor, instead of managing the issue gently and quietly, didn't.  And allowed its spine to turn to jelly and to capitulate to corporate pressure.  The ARU and Qantas might have said that Mr Folau's views were his own and that's that.

But then it gets dirty when Mr Folau's wife retweets her husband's views.  ANZ, the corporate sponsor of her netball team (New Zealand's national team), then contacts her employer and says it, ANZ, does not support her views.  The implicit threat was alive.

Allow W&D to observe that he accepts and voted for gay marriage.  But, at its core, the Folau issue is not about that.  The trouble is that many people don't see it that way - it is seen as about 'inclusiveness'.  Nuh, it's about trying to control people's thoughts and beliefs.  

This is exactly what Orwell predicted and Mill railed against.  Outcries on social media by those looking to be offended or for those who should be offended have become the Salem witch trials [3] of the 21st century.

Cartoon Big Brother

[3] The Salem witch trials were a series of prosecutions of people accused of witchcraft in colonial Massachusetts in the 1690s.  More than 200 people were accused, 19 of whom were found guilty and executed by hanging (14 women and 5 men).  One other man was crushed to death for refusing to plead, and at least five people died in jail.  The episode is one of Colonial America's most notorious cases of mass hysteria.      

New (fiscal) year musings II:  Electricity bills

What's going on?  W&D has just received a letter from his electricity retailer, advising him of an 18% fall in his tariffs.  It's a mystery. 

Trade treaty with EU: don't hold your breath

The EU and South American economic bloc Mercosur (Argentina, Brazil, Uruguay and Paraguay) have clinched a huge trade deal after 20 years of negotiations.  What caused the delay, W&D hears Readers ask.  The usual: European farmers.

Cartoon French Farmers

Readers might consider how long it would therefore take Australia to agree a free trade arrangement with the EU.  Especially as our most suitable exports for the EU are the very ones that European farmers would shout down and prefer to shut out.

So.  Twenty years?  Good grief!  Readers will be aware of a ...

Quick deal.  In 1803, the Yoo-Ess-Ay agreed to buy 2.1m square kilometres of land from France, a deal called the Louisiana Purchase, that doubled the size of the then Yoo-Ess-Ay.

Location of Louisiana Purchase

Negotiations took only 20 days.  US representatives even managed to haggle Napoleon's $22m asking price down to $15m.[4]

Slow deal.  In 2019 Greece and the country of Macedonia agreed to change the name of the latter to Republic of North Macedonia, so as to salve the pride of the province of Macedonia in Greece. 

It took 27 years to finalise. 

Possible Australia-EU free-trade deal.  W&D suggests 30 years.

[4] The purchase of Alaska from Russia in 1867 cost $7.2m.  Negotiations lasted three weeks.  

Finally, the EU decides

The white smoke puffed from the EU's HQ in Brussels.  Three new leaders had been chosen, each a surprise.

 * Ursula von der Leyen (German): European Commission President (effectively CEO of the EU).

 * Christine Lagarde (French): European Central Bank President (arguably, the most important of the roles)

 * Charles Michel (Belgium): European Council President.

Minor roles were tossed to Spain and Netherlands.  Italy missed out.  Again.

This is all good stuff.  Each of Ursula (born in Belgium, seven children, fluent in German, French and English) and Christine (a health-conscious vegetarian, rarely drinks, fluent in French, Spanish and English) is very smart, not nationalistic and tough. 

Sadly, the UK media is looking at the outcomes through Brexit-tinted glasses, as W&D might expect.  However, Readers will know that any further decisions about Brexit, on the EU side, will be taken by the 27 EU leaders, no longer the EU Commission.

And, as W&D has repeated, in various ways, it is folly for the EU to focus on Brexit.  There are submerged logs and rapids ahead for the EU: Eastern Europe, Greece and Italy. 

Not to mention the interfering and prodding by Tsar Vlad. 

Unclear on the concept

Irish Prime Minister Leo Varadkar said the nomination of two women (von der Leyen and Lagarde, see above) for key jobs "sent a powerful message that the EU was leading the way towards ... gender equality."

Cartoon irish gender equality eu women

Hang on.  W&D thought that these roles were decided on ability, not on gender. 

July 4 historical note

Yesterday's celebration in the Yoo-Ess-Ay of its independence from the UK caused W&D to again muse.  This time: how was the Yoo-Ess-Ay constructed after the first 13 states broke away?

Well, as it turns out, mostly by a combination of theft and bargaining with needy sellers.  In fact 61% of the present Yoo-Ess-Ay was acquired by these means.

1. Louisiana Purchase (bought from France: Napoleon was broke): 2.14m km²

2. Alaska Purchase (bought from Russia: Tsar Alexander II was broke): 1.518m km²

3. Annexation of Texas (theft: from being an independent country, formerly part of Mexico): 0.695m km² 

4. Treaty of Guadalupe (theft: Mexico ceded to US after losing the Mexican-American War):  1.605m km²

5. Gadsen Purchase (bought from Mexico): 0.078 km² 

W&D ignores, this time, the uncompensated theft of the land of, and breach of treaties with, native American Indians. 

Speaking of ...

... sport, the English cricket team seem to have redeemed themselves in the eyes of the British media as the Week of Sports begins. 

Cartoon English sport darts

Readers might drool at Wimbledon, Cricket World Cup, Women's Football World Cup and, the event for men with abnormal thighs: the Tour de France.  The latter logically starts in Belgium, which was, after all, once a part of France. 

Unclear on the concept ... of work

W&D dips his lid to the ingenuity of French public servants.  A regional authority in the south of France paid some 30 of them to do nothing for more than 25 years. They have had automatic promotions and pay increases based on seniority or length of service.

Local authorities had failed to find them posts after their original jobs were scrapped when water services were privatised in the southern city of Toulon.  But couldn't retrench them.  And so the lads and lasses will stay on until the mandatory retirement age of 67, to maximise their pensions. 

Nice work, if you can get it.

How embarrassing

When world leaders get together to discuss issues, well it's world leaders discussing issues.  So when France’s Emmanuel Macron, Britain’s Theresa May, Canada’s Justin Trudeau and Christine Lagarde, head of the IMF put their heads together to discuss social justice, best not intrude.

But that's what Ivanka Trump did, with a non sequitur,  "Oh, yeah, yeah, and the same with the defence fund, in terms of the whole system, it has been very male-dominated, so ..."  

Watch the irritation, especially from Christine Lagarde 

As Alexandria Ocasio-Cortez, that shy, new US congressperson, correctly put it, "being someone’s daughter actually isn’t a career qualification." 

Snippets from all over 

1.  Down at the car wash I

Boeing now expects it will take until at least September to fix a newly identified problem on its grounded 737 Max, meaning the jet’s return to service will be delayed until October at the earliest.

W&D comments:  What will come first: Brexit or the return of the 737 Max? 

2.  Down at the car wash II (eastern branch): 

In a quickly arranged meeting in the demilitarized zone this weekend between President Trump and Kim Jong Un, the two leaders agreed to restart talks over denuclearisation. 

W&D comments:  Futility leaps from a photo opportunity.  The two sides don’t even have a common definition of denuclearisation.  Yawn.

3.  Down at the car wash III 

Last week: Bitcoin surges past US$13,000.  This week: Bitcoin dropped to below US$9,000, but this morning was up to US$11,000.

W&D repeats:  Would a Reader please tell W&D why this isn't a speculative investment?

4.  Car sales, job vacancies slump

The sales of new cars in Australia fell in June by 9.6%, being the 19th consecutive month of falling sales.  And job vacancies have fallen for the first time in three years.

W&D comments:  There's trouble at mill. 

5.  Looking like something from Star Wars...

Beijing’s second international airport, Beijing Daxing, has been completed.  It will open by the end of September, after six major test runs.  Road and rail links and a high-speed subway line are already in place.

W&D comments: Construction started in late 2014.  That's 5 years from go to whoa.  Readers will know that construction of Berlin's new Brandenburg Airport commenced in 2006, and it was expected to open in 2012.  But it will now not open until 2021 at the earliest.  Not quite Teutonic efficiency.      

The new Beijing Daxing International Airport.

 

And, to soothe your troubled mind ...

Miscellany 

Last words ...

"Jeremy is just a puppet, he can barely hold his head up.  He is being manipulated and controlled."

 -  a senior UK Labour Party member, on Jezza Corbyn, aged 70, Leader of the Party and Wannabe UK PM.

Alert Readers will know that W&D called out Jezza as nothing more than a marionette some years ago.  UK conservatives greatest fear must be that UK Labour does to Jezza what Australian Labor did to Bill Hayden in 1983.  Then Bob Hawke led a coup against Hayden the day that Liberal PM Fraser called a snap federal election.  Hawke smashed Fraser.

Polling published this morning in the Times confirmed that Jezza's got a problem.  Analysis shows that the Labor Party would fall short of a majority by about 100 seats.

   Chart Jezzas got a problem

First Samuel client events calendar

EVENTS FOR 2019

First Samuel Annual Forum

with Special guest
Hon Josh Frydenberg, MP, Federal Treasurer

at Leonda, Hawthorn

Chief Investment Officer Dinners

Interstate Invitations - Sent

Melbourne - Invitations to be sent shortly, but please see what is already confirmed in the table below. There are also a few more to be arranged

Contact Jess at responses@firstsamuel.com.au to RSVP your preference of venue

 

Venue Seating Date & Time
Stokehouse - St Kilda Lunch & Dinner 28th August 12pm & 6pm
Elyros - Camberwell Dinner 29th August 6pm
Chin Chin - Melbourne CBD Dinner 10th September 6pm
The Botanical Hotel - South Yarra Lunch & Dinner 11th September 12pm & 6pm

 

Some lightly salted absurdities from all over ...

At the extreme left-hand end of the bell-curve ...

Owners of a £10-a-ticket raffle for a £2m Kensington (UK) flat are refusing to hand over the keys to the property after they only raked in £227,000.

Property developers Jonny Jackson and Harry Dee offered the luxurious two-bed flat in the raffle but did not sell enough tickets.

(thescottishsun.co.uk)

Ticket buyers are lawyering-up.

Guess what he did next

Tommy Martin, from North Carolina, said that a fast food restaurant deprived him of his civil rights    

Q.  In what way did he allege that his rights were infringed: 

a.  He was refused entry to the restaurant;

b.  The staff refused to serve him;

c.  He was overcharged; or

d.  He was served too few hash browns on his plate.  

A.  Close.  But no cigar.  The answer is d.  It served him too few hash browns, he said.  So he lawyered up.  This is the Yoo-Ess-Ay, after all.  Tommy said he believes his skin colour (black) led to him being served less of the side dish than other people would get.  The manager said he got exactly the correct number of hash browns.  Tommy's case also states that the incident gave him cibphobia (fear of food).  

(fox43.com)  

Futility

Timothy Kennedy, 39 of New Baltimore, for some reason, became grumpy and decided to use his boat as a ... battering ram.

See footage here

(NPR)

"Ramming speed" works better only if your boat is bigger than the other boat. 

Deepak, W&D's Uber driver ... 

... hardly spoke at W&D buckled in.  "Why the Carsales sticker on the back window.  Haven't you just bought it?  What's going on"

“Bitcoin is the least of my worries, Mr. W&D. She knows!” he wailed.

“Don’t tell me that nice Mr Zuckerberg has shared with Anjali your little secret?” W&D asked cheekily.

“No, not Anjali, it’s worse, my mother-in-law!  You see I found this lovely 22-year-old online, she was a dream and her name was Saffron Seduction. We talked, you know,” he said, a misty look crossing his face.

“And?” W&D encouraged eagerly.

“My mother-in-law has been acting very strangely recently, very happy and giggly you know. She used to be such a sad old lady, but not anymore.  Then she came home from Bunnings with her shopping jeep and met me in the driveway.  She pulled out two bricks and clapped them together very loudly and said, do you know what these are for Deepak?  I was very frightened Mr. W&D.  She called me a fool among other things in Hindi that I can’t repeat, but you’ll never guess that she too uses the Facebook dating app, and what are the chances…” he tailed off sadly.

“Her nom de plume is Saffron Seduction” W&D finished with a grin.

“What is a nom de plume, Mr. W&D?”

“Ask Mr Zuckerberg. But more importantly, what happened next?” pressed W&D, now perched on the edge of his slightly undersized faux leather seat.

“She held the bricks under my nose in the most threatening manner and said, it’s either I tell Anjali and she gives you the bricks or you get started with these out the back.  She then handed me a large roll of paper with plans drawn up for a granny flat.”

W&D chuckled.

“I’ve poured the slab and the bricks are about 2-foot-high, but she wants the Taj Mahal.  It’ll kill me.”

“That’s as maybe” quipped W&D as he sifted through Deepak’s options.

“You could always come clean?” W&D suggested unhelpfully, shifting uncomfortably in his seat as he considered Anjali and the bricks.

“Anjali would never forgive me, and if I don’t build another foot higher every day my mother-in-law suddenly appears clapping those bricks together, grinning wickedly.”

“Well Deepak, a wife or husband for that matter, deserves more respect and honesty, but given the predicament that you find yourself in, might I suggest …”

W&D paused mid-thought.

“You do have a permit for this Taj Mahal?” he asked.

There was silence from the front seat. Then a large gulp.

W&D sighed.

“Go home to Anjali, confess and be the man she believes you to be.  Or I guess you could always recall those cousins of hers to help.”

With that W&D alighted.  Saucy Minx he thought, and left a subdued Deepak in his wake.      

Cheers.  

Anthony