Wry & Dry

Whilst Readers are voting... Lego, perhaps? Join the dots.

It's a big Saturday

Readers will be aware that the most momentous event will occur tomorrow.  And W&D can hardly wait.

It's the final of the 2019 Eurovision Song Contest.

And in this age of globalisation, a song contest for countries in Europe has spread its vocal chords.  This year's final will be held in Israel.  Not quite a part of Europe.  [1] 

But it gets more bizarre. Australia has been allowed to participate since 2015.  Also not quite a part of Europe. [2]

W&D considers that watching the Eurovision final will be more entertaining but just as arcane as watching the Australian election results.

And if the worst comes to the worst, there is always the FA Cup Final. 

WryDry 508

[1]  Although, Readers will know that the then Palestine was conceded by the Ottoman Empire to British administrators after the First World War.  The mandate finished in 1948 with the partition of Palestine.  But whilst Britain is decidedly a geographically part of Europe, decidedly, Israel is not. 
[2]  Readers will know that Australia was a colony of Britain until 1901.      

Like fast bowlers, political success comes in pairs

Readers will know that crickets greatest fast bowlers were most successful when operating as a pair.  Lindwall & Miller, Larwood & Voce, Lillee & Thompson, Trueman & Statham, Younis & Akram and Holding & Roberts spring to W&D's rusting mind.

And so, it also seems the case in Australian politics.  Whilst there have been two individuals whose contributions towered over their colleagues (Curtain and Menzies), the two greatest reformers in Australian history succeeded because their leadership was immeasurably strengthened by their treasurer.

John Howard had Costello.  And Bob Hawke had Keating.  In each case, the Prime Minister would not have achieved anywhere near the success that eventuated without the courage, wit, reform-mindedness and deliverability of their treasurer.  Howard would have turned into a bland, modern Menzies.  Hawke, well who knows?

And that was the enigma of Bob Hawke.  Much is written in the media today about his raw Australianism: brash, narcissistic, womanising, drinking, etc.  But too little about his skill, deliberate or accidental, in using those traits to political advantage.  Sure, he knew the workings of the labor movement.  And he was smart enough to understand the bigger business and economic issues of the day.  But he also knew that enduring political success comes in occupying the middle ground and taking the voters with him.  Not for him the battle against 'the big-end-of-town'.

And with Keating to fire the political broadsides and present the necessary economic reforms with a blend of brutality and deftness, both within the labor movement and externally, Hawke just had to manage the macro picture.  Like good CEOs do.

W&D ponders whether Hawke would be electable today, with the focus on sanitised, bland and politically correct behaviour (unless one comes from Queensland). 

Probably not.

Twice popular   

W&D is popular only on two occasions.  Fathers' Day and Election Day.  Fathers' Day is still some way off.  But on Monday W&D fronted the pre-poll polling booth in Melbourne's CBD to cast his vote for a party to occupy comfortable seats on Planet Canberra at we-the-taxpayers' expense.

And within sight of the polling place W&D was besieged by an enthusiasm of multiple party supporters, each professing profound interest in his well-being.  This interest was not confined to acolytes in Soviet Red, Royal Blue or British Racing Green t-shirts.  Readers might imagine the flag [3].  W&D was not aware that there was an Animal Justice Party (a party for hard-up lawyers seeking a new market), an Australian Affordable Housing Party (caravan manufacturing companies); or a Love Australia or Leave Party (travel agencies).

But those stalwarts from the 1960s are still around: the Help End Marijuana Prohibition Party (HEMP).  W&D dips his lid for the persistence of its supporters.  Perhaps for whom, lost in an eternal fog of a cannabis carnivale, all the elections merge into one.

Anyway, W&D polling-booth popularity was only momentary, once the madding crowd realised that W&D's attention was drawn only to the representative of his least worst option.  The mob turned its attention to the next hapless and confused voter.  

[3] Actually, Readers will know that there is not one country flag of that colour combination.   

Banks paying the bills

Readers will recall W&D's oft made comments about the banking Royal Commission, that 'the thieves have scarpered'.

Well, it was announced this week that CBA has raised its customer 'remediation costs' to $2.2 billion.  The total of the banks' payouts to duped customers might very well top $10 billion dollars.

A thousand questions spring to W&D's bank-weary mind.  However, one stands out.  When the going was good, the banks termed all these ill-gotten gains as normal income.  But now they have to give it all back, the banks do not count these costs in normalised profits, as they are 'one-off' costs.  And not counted as part of "cash profits".

So, are the banks now overstating their profits?

WryDry 510

Join the dots 

Readers will know that W&D thinks of himself as somewhat of a Renaissance man person.  Well, sometimes. 

This week his eye was drawn to reports of the sale of artwork in Noo Yoik for what seems to him to be very large sums of dosh.  A painting of a fruit bowl, of all things, by a chap called Cezanne fetched US$59m and a landscape by the difficult-to-pronounce Van Gogh (Go? Goff? Hoff?) was sold for US$40m. 

The curious thing in the night was that the focus in the media was not on the art itself, but on the auction houses.  That is, which of the Big Three had sold most in value.  Hence the following chart, which itself might be passed off as an Australian work of art:

Auction houses

Readers will know that the top right-hand yellow dot is the Salvatore Mundi, by a struggling artist called Leonardo di ser Piero, from a town called Vinci in what was then (1500) the Republic of Florence.  The price of US$450m was the highest ever paid for a work of art.  It was believed to have been purchased on behalf of Abu Dhabi's Department of Culture and Tourism for Abu Dhabi's new Louvre Abu Dhabi.

With buyer's commission of 13.5%, the Leonardo was a US$60m win for Christie's, unless a special deal was negotiated.  Nice work, if you can get it.

Trade wars - money moves to Hong Kong and Bitcoin

Readers may be wondering why the price of Bitcoin has leapt in the last week (up to over US$8,000).  As Readers might expect, W&D has the scoop.  It's all about a capital flight from China.

Readers know that China forbids its citizens moving more than $50,000 out of the country per year.   And China cracked down on the capital flow exodus into foreign real estate.  The Chinese then discovered Bitcoin, the value of which went from US$1,000 to over US$19,000 in a nano-second.  China crypto-currency exchanges were said to account for 90% of global bitcoin trading.

However, in late 2017, the Chinese government cracked down on Bitcoin — banning crypto-currency exchanges. That set off the Bitcoin crash, from US$19,000 to US$3,000.

But now worries about the trade war and the devaluation of the yuan has caused the price of Bitcoin to jump.

And not only is the capital flight evident in Bitcoin buying but also in corporate capital being transferred through what is called the Shanghai-Hong Kong pipeline.  Net daily outflows reached US$1.6 billion this week, the highest since 2015.

W&D sense two things going on here.  Firstly, short-term moves to get hot capital out of China: a currency and trade wars' effect.  Secondly, the longer term trend of Chinese wanting to get capital and themselves out of China. 

In the last 10 years an average of net 2 million Chinese per annum have migrated.  

Not happy, Mr Xi.  

WryDry 512

Property investment boom?  Err. no.

Readers from Melbourne may have noticed an article this week about an apartment in East Melbourne being on the market for $46m.  It was purchased in 2007 for $19m.

The newspaper gushed at the massive gain and what a great investment it was.  Err, maybe not.

After purchase costs (stamp duty, etc) and sale costs (agents fees) and ignoring any net rental income, land tax, maintenance, rates, etc, that is a capital return of just under 7% p.a.  Which is a good return.

That is if it is sold for the asking price, of course.  And Readers know that a property investor cannot sell a bedroom.

Tech stocks, just a little over-valued?

Readers know that W&D prefers a chart to words.  Except when the words are his.

Which is not the following case.  Buyers of Australian tech stocks beware.

Australian tech stocks

Just sayin'.

WryDry 513

Property woes

Owners selling their apartments in what was the most prestigious apartment/ commercial building in New York have all made a loss since 2016.  The average inflation-adjusted sale price is a loss of 20%, compared with a gain of 0.2% across the rest of Manhattan.  Its vacancy rate is now 17%, twice Manhattan's average for similar buildings.

And Readers can understand why.  It has been turned into a fortress, ringed with concrete barriers and its two main entrances partially blocked off.  

The building?  Trump Tower.

Meanwhile in Sweden ...

... the curious case of Julian Assange continues.  Readers will know that Mr Assange was evicted from the Ecuadorian Embassy in London for not paying rent for 7 years.  He was then plonked into the slammer for 12 months for jumping bail.

W&D can only hope that the food is better in Belmarsh prison than that found in the average London restaurant.

Meanwhile, the US government announced it would seek his extradition for alleged breach of national security legislation.

And now Swedish prosecutors will seek his extradition to face investigations into an outstanding rape charge.

W&D suspects it will be a bad decade for Mr Assange.  But somehow, in a weird narcissistic way, he will enjoy the drama.

The opposite of über is ...

... a German word for an IPO that as fallen 13% in four days.  Uber, the 'ride-sharing' company, had its debut on Wall Street on Monday.  It's been a car-crash since then.  It is now the IPO with the greatest lost value in history.

The pro-tip in all of this is that companies that don't make profits are vulnerable when the emotional tide turns from euphoria to despair.

But hats off to the company for getting the issue away.  The money is in the bank!

WryDry 514

Snippets from all over 

1.  Down at the car wash 1: Chinese branch

The US raised its punitive tariffs on Chinese imports to 25% from 10%.  This raises the stakes in this getting-ugly trade war. 

W&D comments:  Chinese have only partially retaliated, for the moment.  Perhaps someone should tell I-Wanna-Tariff Trump the old saw: "revenge is a dish best served cold".  The Chinese are still having a whinge about the Opium Wars (mid-1800s).  Watch out for Chinese imports of Boeing aircraft to be slashed.     

2.  Down at the car wash 2: Iranian branch

Just as a Yoo-Ess-Ay aircraft carrier strike group was about to arrive in the Persian Gulf to add some 'defensive' pressure on Iran, two Saudi oil tankers were 'significantly damaged' in what the Saudis called 'sabotage attacks'.

W&D comments:  W&D is trying to join the dots on this.  But as with many things in the Middle East, some dots just will not join up.  Only to note that Tsar Vlad would love to see the Yoo-Ess-Ay drawn into a Persian Gulf conflict, for two reasons.  Firstly, it will push up the price of oil, thereby helping Russia's oil-based economy.  Secondly, any entanglement of the Yoo-Ess-Ay in the Middle East will inflame anti-Yoo-Ess-Ay sentiments - of which Russia will somehow skillfully take advantage. 

3.  Optimism

French legislators have moved to fast-track the restoration of Notre Dame, with a goal of achieving the task before the Paris Olympics in 2024. 

W&D comments:  W&D can only assume that M Macron must have negotiated with Chinese 'Belt and Road' initiative for the rebuild.  If the Chinese could build the new Hong Kong airport from scratch in 5 years, rebuilding the Notre Dame should be a breeze.  Either that or it's Lego.    

WryDry 515

4.  It's not Greece, but ... 

Pakistan has just been granted its 22nd bailout by the International Monetary Fund, amounting to some US$6 billion.  

W&D comments:  The problem for Pakistan's President, the former Test cricketer Imran Khan, is that the strings attached to the bailout might run up against Mr Khan's plans for an Islamic welfare state.  In the meantime, W&D has asked his people to research if this is a new test record for bailouts.  

Irony of the Week 

Podium finish goes to ... Jeremy Kirk, Westpac's barrister, in a court case where the bank is being sued by ASIC.  Mr Kirk likened ASIC's approach (to assessing household expenses on loan applications) to "19th-century accountants keeping a book as 19th-century author Charles Dickens walks in."  With which sentiment W&D agrees.

But the irony is that had Westpac adopted 19th-century ethics in dealing with its customers, it wouldn't have to now pay massive remediation costs (now over $1.5 billion) arising from the malfeasance of some of its staff.  

Deepak, W&D's Uber driver ... 

... didn't phone this week.  But he left a text message: "Bitcoin's price is up to A$11,800!  Highest since March 2018.  Will Anjali forgive me?"  W&D responded: "She might if you were in Melbourne."     

W&D on vacation

As Readers read this edition, W&D is safely ensconced in the city of his forefathers people.  Far away from election day and the dreaded theatre of the gloating or retrospective post-electoral policy justification that will ensue ad nauseum on television.  And sadly, W&D will miss the amazing Eat Street charity event.  Diary mismanagement (not from W&D) was the culprit, not an unwillingness to share in the fine food and wine.  But Readers should look out for his doppelganger.

Fri-24-May - W&D on vacation

Fri-31-May - W&D on vacation

Fri-7-Jun  - W&D on vacation

Fri-14-Jun - published

And, to soothe your troubled mind ...


Last words ...

Until the election, W&D will present apposite quotes on politicians and elections.

"I have just received the following wire from my generous Daddy. It says, ''Dear Jack: Don't buy a single vote more than is necessary. I'll be damned if I am going to pay for a landslide.''" 

 -  John F Kennedy, former President of the Yoo-Ess-Ay.

JFK's father, Joseph, was an extremely wealthy businessman, insider-trader, anti-Semite, pro-Nazi and allegedly election-rigger (1946, when JFK first ran for Congress).     

First Samuel client events calendar

Events for 2019

Eat Street

Tickets have been sent   

21st May 2019 - The Sofitel   

NGV Viewing and Cocktail Night

Invitations sent this week

25th June 2019 - NGV 

Contact Jess at responses@firstsamuel.com.au to RSVP

Some lightly salted absurdities from all over ...

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

A seemingly fit, BMI-compliant, 33-year-old woman from the UK was wondering why she was having heart palpitations.  And had kidney stones and pre-type-2 diabetes.

After she again passed-out last week, she was taken to hospital.  Her problem?  She drinks six-energy drinks each day.

(UK Metro)

She has had to have a pace-maker fitted.

Guess the outcome

A man overstayed his visit in a Miami Hilton Hotel.  The receptionist called the police.   

Q.  How did the police respond: 

a.  They ignored the call, "sort it out yourself";

b.  Two officers attended the scene, but by the time they got there the man had paid his bill and checked-out.

c.  Two officers attended the scene, but when they broke down the door they found the room was empty and hadn't been used; or

d.  A SWAT team swarmed the Hilton Hotel.  

A.  Close.  But no cigar.  The answer is d.  Not only the SWAT team but also a hostage negotiator was readied.  The bomb squad stood nearby with its robotic device.  Emergency medical technicians positioned themselves with gurneys.  Roads were closed.  Businesses and schools were shut down.  The hotel was partially evacuated.


A keen young policeman thought he heard gunfire.  And someone, well, panicked.  But when the police burst into the room, no gun was found.  In fact, the occupant was sound asleep: he had had an afternoon nap and slept through the calls from the receptionist and the knocking on the door. 

Pro tip: choose your victim carefully

Deangelo Lindsay, 19, and Precious Howard, 22, were waiting to rob someone in a car-park in Huntsville, Alabama.  They saw a seemingly prosperous couple.  And walked up behind them with handguns and demanded money and personal items.

The man turned around, pulled out a handgun and shot Lindsay in the leg, who staggered back to his car with Howard.  Police caught them a short time later when their car slammed into a concrete barrier.

The man had a licence to carry a weapon.  He was a policeman.  In uniform.   

(WHTN Huntville)


Cheers.  The W&D Quill returns on Fri-14-Jun.