Wry & Dry

What could possibly go wrong? Unclear on the concept. Barbarians at the gate.

What could possibly go wrong

Wry & Dry ponders Napoleon's retreat from Moscow.  And Hitler's retreat from Moscow.  But none comes close to the utter and global humiliation of the plotters of the breakaway European Super League. 

Cartoon what could go wrong

Or more particularly of its banker. 

Readers will remember Wry & Dry's observation last week, when writing of Archegos and the daft lending made to it by greedy bankers: "...dangle brokerage of $100m per annum in front of a banker..."

Wry & Dry now invites Readers to review the words of Jamie Dimon, JP Morgan's Chairman and CEO [1], in the bank's recent Annual Report: “As you know, we have long championed the essential role of banking in a community - its potential for bringing people together, for enabling companies and individuals to reach for their dreams.”  Lovely stuff, positioning the bank in a socially responsible world.  And focussing on communities.  Wry & Dry teared up.

So, what was the bank thinking when it agreed to underwrite the new breakaway European Super League to the tune of €3.25 billion?  And with each of the league's members promised an initial payment of between €200m and €300m.  All at the expense of thousands of football communities.

Err, Mr Dimon, remind Wry & Dry about communities.  Or maybe not.  What JP Morgan was thinking was the millions of dollars in fees it would earn.  Just enough to assuage Mr Dimon's conscience.

The reality is that the new league was designed with a single purpose: to extract for wealthy owners a still bigger share of the income from broadcasting rights.  And to ensure that their returns were stable by eliminating the risk of any club falling out of the competition, by making it a closed competition. 

Segue: Most football (i.e. soccer) leagues are 'open' competitions, with promotions and relegations between league tiers.  Premier US sports leagues are 'closed', which ensures stable broadcasting income.  Australia's AFL is a 'closed' competition, which means that the broadcasting revenue is stable and the loot can be shared between overpaid players, overpaid AFL executives, virtue signalling projects, with a pittance to local leagues.  And which is why the AFL is so strongly against a Tasmanian team. 

The insurrection against the European Super League was really an insurrection against elites.  Mr Dimon has shown that he sits in the elite grandstand.  And that he has forgotten the words of John Pierpont Morgan, the founder of the bank, "A man I do not trust could not get money from me on all the bonds in Christendom." [2]  Did he really trust those wealthy soccer elites? Or perhaps just the fees he would earn?

[1]  The fact that the Chairman is also CEO, as is the case in most American companies, tells another story. 
[2]  J.P. Morgan dominated corporate finance on Wall Street in the late 19th and early 20th century.  During the Panic of 1907, he organized a coalition of financiers that saved the American monetary system from collapse.   J.P. Morgan and Co begat: Morgan Guaranty Trust, Morgan Stanley and Morgan Grenfell. Wry & Dry can disclose that he worked for J.P. Morgan Investment for 10 years.

Unclear on the concept   

The Victoria Auditor-General, in a masterpiece of political ignorance, said that the Andrews government has a "tendency to underestimate costs and over-estimate benefits" when approving major projects.

Good grief, man.  That is the very role of government.  That is how votes are gained and elections won. 

The fact that the Andrew's government has over-promised and under-costed projects by billions of dollars is not relevant.  The fact that the first 50 level crossing removals were to costs $5 billion and actually costed $8.3 billion doesn't matter.  Similarly the $11 billion Metro Rail tunnel will now cost at least $13.7 billion. And so it goes on.

cartoon take nothing but money

The art of government is knowing that (a) by the time an infrastructure project is delivered, voters will forget the original budget; and (b) by the time it comes to finally pay off the debt the Premier who decided on the project will be long gone.   

Chairman Dan has Legend Status in the Over Promise and Under Cost Hall of Fame.

Barbarians at the gate

Astute Readers will realise that things in Russia must be getting bad.  "Things' could mean a range of matters that are causing the average Russian in Red Square to hit the vodka more than usual.  Not least of which is the Navalny problem [3].

The tell-tail sign is that Tsar Vlad is showing his hairy chest, flexing his military muscles and speaking "thems fightin' words".  A military build-up on Ukraine's border greater than that before the invasion of Crimea is underway. Tsar Vlad, a student of history, is taking a leaf from Otto von Bismarck's textbook [4].  To divert attention from domestic issues, Otto would rattle the sabre and occasionally invade neighbouring countries.    

Moreover, Tsar Vlad said "If red lines of Russia's security are crossed it would bring an asymmetric response."

Last night, Tsar Vlad ordered the massing troops to unmass and return to barracks, having made his diversionary point.

cartoon chernobyl

Readers should expect upcoming signs of worsening domestic matters in Russia.  Wry & Dry considers that Tsar Vlad is weaker than he seems.  

[3]  Alexei Navalny is the de facto leader of the opposition in Russia, but now languishing in jail and on a hunger strike.   
[4]  Otto von Bismarck was a conservative German statesman who masterminded the unification of Germany in 1871 and served as its first chancellor until 1890, in which capacity he dominated European affairs for two decades.  He provoked three short, decisive wars, against Denmark, Austria, and France.  The Second World War battleship the Bismarck is named for him.  Bismarck, North Dakota, is the only U.S. state capital named for a foreign statesman. 

Snout still in the trough

Last week Wry & Dry reported on federal LNP MP Andrew Laming's skilful reading of the fine print to ensure he received a $100,000+ "resettlement allowance" from we-the-taxpayer when his parliamentary DCM occurs.

But wait!  There's more!

Dr Laming is chair (sic) of the House standing committee on employment, education and training.  For which his salary is augmented by 11%, i.e. $23,237 p.a.  Hang on - he told the world that he was stepping down from all parliamentary roles.  And was going on medical leave to undertake "empathy training."

Well, maybe not.  He is still chair (sic) of that committee.  And still getting the extra $23,237.

Nice work, if you can get it.  

Three words Mario

Sleepy Joe's US$2 trillion infrastructure package (proposed, not yet passed) has inspired others.

New Italian Prime Minister, Mario Draghi, has announced a €221 billion recovery package for a radical restructuring of Italy’s economy.  Mr Draghi is a former president of the European Central Bank, who arguably saved the euro.  At the height of the Greek fiscal crisis in 2012 he said that the ECB would do "whatever it takes" to preserve the euro.  Those three words halted the crisis in its tracks.

Wry & Dry considers that it will take more than three words and €221 billion to rescue the Italian economy.  But wishes him the best of luck.

Less children

Wry & Dry has little idea about the best way to reduce his carbon footprint.  And it seems that his poor, malnourished brain is representative of most people.  

A recent poll [5] showed that most people are unable to identify which lifestyle decisions are the most effective in reducing carbon emissions.

Table carbon 2

Wry & Dry notes the final row.  And is inspired.  And will now have three less children, to save almost 180 tonnes of CO2 p.a. 

cartoon one less

This will mean he can now continue to eat meat and ignore multi-coloured food items.

[5]  Source: Ipsos Mori poll of 21,011 in 30 countries.  Cited in the financial Times 17 April 2021.  

Just sayin'

Turkey spent $165 billion of foreign currency reserves over the last two years attempting to prop up its currency.  The level of reserves fell by 75%, leaving just $10 billion in the kitty.  Investment bank Goldman Sachs estimates the central bank has negative net foreign assets of $60 billion.  

Ankara, we have a problem.

Inflation has been gripping the Turkish economy.  Most economists would have suggested raising interest rates.  However, the central bank lowered interest rates at the behest of Sultan Recep Tayyip Erdogan.  The currency went into free fall.

The two year period coincided with the period when the Sultan's son-in-law Berat Albayrak was treasury and finance minister.

Just sayin'. 

Just askin'

Well, there goes the neighbourhood.  New Ziland has broken with Anglophone allies over using the “Five Eyes” intelligence-sharing network [6] to confront China, reversing an agreement to expand the network’s remit.

cartoon blind eye

Nanaia Mahuta, the foreign minister, declared that New Zealand was “uncomfortable” with pressuring China and wanted to pursue its own bilateral relationship.  

Is New Ziland's woke PM, Ms Ardern, playing realpolitik: ignoring abuses in Hong Kong and against Uyghur Muslims in order to preserve and grow its trading relationship with China?  Recent figures show 29% of New Zealand’s exports are sold to China.

Just askin'.

[6]  US, UK, Canada, Australia and New Zealand.

Musings

Readers would have noted that UK PM Borisconi gave up his seat at the funeral of Prince Philip so that a member of Phil's family could attend.  Noble indeed.

Which leads Wry & Dry to muse the reaction of recent Australian Prime Ministers had they been invited to the scaled back funeral.  Consider:

Whitlam, Gough: "Well may we say God Save the Queen, comrade, but I'll go.  And take in Greece at the same time."

Fraser, Malcolm:  "I'll ask Tammy."

Hawke, Bob: "Any boss who doesn't give his workers the chance to meet the Queen is a bum.  I'm going."

Keating, Paul: "I'm busy."

Howard, John: "Jeanette and I would be honoured to attend."

Rudd, Kevin:  "I'll ask my close friend Xi Jinping if I can attend."

cartoon rudd

Gillard, Julia:  "There was no carbon tax under my government.  So the carbon emissions created by me going will not be taxed.  So, I'm going. 

Abbott, Tony:  "Well, I did give him an Australian knighthood.  So, I'm going."

Turnbull, Malcolm:  "Australia must become a republic and do away with this sentimental monarchy stuff.  However, in the interest of international relations, I shall go.  But I'll sail to the UK so as not to contribute to global warming."

Morrison, Scott:  "I went down to the pub last night and asked a person there, whose name was Jen, I think, if I should go.  She said, "yes."  So the trip passed the pub test.  I'm going."   

Snippets from all over 

1.  Australian business investment plans explode 

Business investment plans for the next 12 months have risen to a 27-year high, according to NAB.

Wry & Dry comments:  Happy days.     

2.  Australia world's favourite destination 

Australia has topped a survey of 22,000 international travellers who say that it's the safest destination to which to travel, closely followed by Japan.

Wry & Dry comments:  Err, but the federal and state governments don't want them to come.

3.  UK house prices 

Average house prices in the UK rose by 8.6% year-on-year in February, the fastest annual rate in more than six years, according to the Office for National Statist

Wry & Dry comments:  A rush of demand in anticipation of the end of the stamp duty holiday at the end of March may have been factor.   

4.  Netflix flicked

Growth worries surrounded Netflix following its earnings report after Tuesday's close, sending the stock down 9%

Wry & Dry comments:  The 'streamer' only added 3.9 million paid net subscribers during Q1, short of its guidance for 6 million and consensus forecasts of 6.2 million.  But at least Netflix is profitable, making $1.7 billion in the quarter.  And it plans to spend $17 billion this year on content.

5.  HSBC boots executives from executive floor

HSBC, one of the world's largest banks, has abolished the entire executive floor of its London HQ to make way for 'collaborative space'.  The senior executives now have to hot desk on an open-plan floor two storeys below. 

Wry & Dry comments:  No mention was made as to who still gets the key to the executive toilets. 

And, to soothe your troubled mind...

Last words...

“Australia will not achieve net zero emissions in the cafes, dinner parties and wine bars of our inner cities."

 - Jimmy Morrison, Australian PM.  

Captain Obvious.  The net emissions made in the cafes, dinner parties and wine bars that Wry & Dry attends are significantly greater than zero. Always have been.

 

PS A reminder that the opinions in Wry & Dry do not necessarily represent those of First Samuel, its employees or directors.

 

Cheers

Anthony