Risk + Fail = Good

When in 2008 Ben Bernanke decided to tamper with monetary cycle algebra, virtually -, by assuming there was some sound reason to grant liquidity to illiquid banks, what he actually did had a major impact in this area of human psycho-socio economic behaviour.

When business people cannot make accurate monetary and velocity flow assumptions, then one of the main issues that arises which is rarely discussed, is the human social tradition of avoidance of failure...

Right now there is no real knowledge in the hands of any market economist anywhere about the immediate, much less the mid-term future. It is not predictable what the consequence of QE actually means for corporate dividends. And it is especially not predictable what the consequence will be for the ending of QE.

AClub of Rome? Federal Reserve Committee?
No - Haig Welcome Club.

But what is most certain and visibly demonstrable, is that business owners, managers, and entrepreneurs have stopped learning. And this is because on the whole they fear failure, and they won’t take risks when the future is as unknown as it has just now become – compared to the past structure of monetary cycles.

This unwillingness to take risk is of course, a huge mistake, although it separates out the true entrepreneurs from those who had been in the role previously but were relying on the predictability of economic growth rates (whether positive or negative) determined by monetary policy fed through actual market pricing of money, to take calculated risk.

In fact, the acknowledgement of the possibilities for failure, but the understanding that managers must be in a position to learn from failures – is what permits leadership and unique successes in the long run.

Profit-seekers must take risk, and against a background of greater unknowns about currencies and money pricing than ever before – but they must accept when they encounter failure and learn from it and go back and try again.

The one big unknown is however will policy makers deal with the coming discounting of four trillion dollars of QE money, and the subsequent increases in market interest, and which will most certainly break governments as we have known them...

Setting Standards

You take an old-school type guy like the US Navy Admiral, Admiral Michael S. Rogers – the person who is now heading the NSA – and immediately you see so many things different about him compared to a lot of others. I am not a complete cynic, but neither do I want to curse him with impossible expectations – which would tend to be the effect of the fantasy desires or wish-list that I would have for him if I released my own imagination on him for even just one second!

I just hope he doesn’t get ground down by the environment, and the Washington machinery over the next two or three years.

A man of principle,

in movies anyway!

It’s too easy for those who reach the top by playing the structured, conservative, almost academic game of not treading on the toes of your peers – too easy for them to see themselves as uncriticizeable. (Is that a real word? Sounds good to me.)  It’s all too easy to be completely certain that your moral and ethical compasses are accurately set to True North. All too easy to employ the Platonic ‘therapeutic lie’ without ever having taken the necessary Hippocratic Oath that goes along with it.

And it is for these reasons – and especially too I suppose, because we live in so much greater of a complicated world than any human before us has ever lived in before. I do believe that anyway. So for these reasons the re-establishment and constant referencing to some kind of independent ‘standards’ of ethics and behaviour and decency is called for today more so than it has ever been in the past. In my opinion.

I am holding out some hopes for the Admiral.

I can’t imagine him saying to himself ‘I am protecting the public by lying to them, and I’ve checked all the details out about which I am lying to them over, and I’m absolutely unquestionably right about them so I’ll just keep doing it. And besides, all of my peers and everyone around me agrees with what we are doing...’

When there is another whistleblower/leaker it wouldn’t surprise me if it were an actual field operational guy, in other words – a firmware executive – rather than a cyber specialist. It actually wouldn’t surprise me if it weren’t even Rogers himself, a kind of a really deep Deep Throat, who would let slip what was really at stake if people continued to ‘get things wrong.’ And that’s a good thing, even if he – the Deep Throat - were never ever revealed eventually, and everything remain the mystery it ought to be. Because what everyone has forgotten in all of the self-interest, the self-protection by the relatively conservative academia-directed security policy, and the desire to also enhance careers after paid public service – is that no nuclear wars took place because at some point all the main ‘sides’ realised each other had total destruction capability.

 

A Russian military display,

very old-school stuff.

Nobody realises what could happen if some opponent covert side started to hit back using the currently actually available technology. Everyone thinks drones and smart missiles and bullets and unsubtle DNS cyber attacks and the like are ‘cutting edge.’ They are not. The cutting edge is austere, stark, and very terrible. There is absolutely no protection against it, it’s even far far far worse than Ebola or that kind of thing and it is utterly undetectable. No Seal Team 6 or anything of that nature can take it down or locate it. My prediction is that at some point, the Russians are going to turn the wick up on what covert action really is, and what countermeasures they truly have available to them to push back on economic sanctions.

I’m going to give you all an iron clad guarantee here – there are things coming down the pipeline that are going to give everyone pause.

The thing about technology is that if one side has something very soon the other will too.

Sooner or later the realisation is going to dawn on the major Western administrations, that things are nowhere near as simple as they had thought.  At that moment, people of great principle are going to be much in demand – because they are the only ones who will be able to devise ways for nation-states to get along and in ways acceptable to their voting public constituencies.

Winner- takes- all and to hell with the loser is totally a thing of the past. People haven’t quite woken up to this yet because no one has seen what weapons the other side has at their disposal. People have made a lot of assumptions about what weapons they do have, and these assumptions are going to fall short of reality.

 

Chill out -

Leffe Royale - a truly great beer.

Yes there is another leaker.

Every ‘end-game’ scenario always has leakers and people of conscience.

Within five to ten years there’s going to be a lot of changes take place. Beyond your wildest imaginings. And that is why the highest human moral and ethical standards are significant now. If mutual trust is the only currency, people of moral worth become the standard of currency. Whilst ever there is a prospect that one side can dominate, trustworthiness is irrelevant. But no one side can dominate any more. You can’t see it obviously just yet, but you will see it. And soon.

Apres La Guerre

‘Nothing much changes under the sun,’ some say.

And yet there are also others who say: ‘you can never swim in the exact same stream twice.’

Pullum Frontonianum

fried chicken ancient roman style

Here is a pic of some fried chicken done in the way of a recipe dating from around the 4^th Century in Ancient Rome. This dish is called ‘Pullum Frontonianum’ (it’s still called that, btw) and its is based around a marinade of olive oil, dill, red wine, salt, dried rose petals, ground coriander seed, black pepper, and fig syrup – with the whole thing fried first to get it crisp and brown on the outside, and then slowly baked with the marinade again added regularly over the top during the baking process.

Those Formula 1 car racing teams and drivers sponsored by Total Oil will not quite be the same as they were before the jolly fat man with the handlebar moustache was a regular figure in the garages and in the hospitality tents.

 

Total is sponsor of Romain Grosjean
and the Infinity Red Bull Team

De Margerie was from the same family that owns Taittinger Champagne, a very fine accompaniment to Apicus Chicken – the other name for the chicken recipe above, named after the recipe book in which the recipe was first recorded – as far as we know – with that book also dating from around the 4^th Century.

So, does everything change, or does nothing really change.

Well, we can hardly go past the French for the answer: ‘apres la guerre – la guerre.’ And ‘plus ca change, plus c’est la meme chose.’

Here is a nice memorial to M. De Margerie:

http://www.forumspb.com/

...At the bottom of the page. Until last night his pic and his position were right in the middle of all the other dudes here.

 

 

The Angry People Hit Out Again

If you wandered into a men’s club – pardon me for this textual only and therefore nugatory sexism – wearing the very latest Kiton (which is certainly, the very best modern era cutting and tailoring house) clothing made from the fabric as seen in the pic., how many there would immediately be on guard to see if you carried a message...?

Cord of the king

by Kiton

Or if you wore a garter-like belt and sported a single golden earring with a sword at your side, what would the sartorial aficionados of the Elizabethan era think?

‘Apophasis’ is the word that describes one of the late E. Gough Whitlam’s favourite manners of speaking: “Far be it from me to... But...” Apophasis means talking about something by pretending to leave it out.

 

An actor being Edward De Vere,

Earl of Oxford, as in portrait paintings of said Earl.

He wears a garter and sword in the paintings.

Far be it from me to say who I really think was the actual author behind the works attributed to a certain William Shakespeare... But -, the Earl of Oxford is being described in his portrait here as a Duke or even King of Bohemia, with a ring in his ear similar to the way privateers wore such items, in order that they may purchase a ‘decent burial’ whilst at sea and perchance, die. This is where the pirates of later days got the tradition.

Oxford had rooms at Gray’s Inn at a place which other great writers frequented later on – Dickens, J.M. Barrie, Sir Thomas More, among several luminaries. The specific pub was called Furnival’s Inn, and was something like an insurance company’s headquarters.

Outside in the courtyard we also have a statue of Sir Francis Bacon – often also suspected of being the actual ‘Shakespeare.’

 

Sir Francis Bacon outside

Gray's Inn law library

But who today, readily and off the top of their heads, would suspect anything when an individual wearing corduroy walks in and asks for directions to the oak tree?

For all these things are things of the past, are they not.

Today’s parchment paper is a most expensive item. And if you are ever asked to put on a play for Her Majesty Queen Elizabeth, no doubt you will be a tenant farmer’s son, with goodly supplies of such things, and many a confidential word of society to-ing and fro-ing at your fingertips, and the verbal cadence and word stock of a Bacon or an Earl of Exford at your linguistic behest. And balls. Lots and lots of tennis balls.

You will not be a drunken limousine driver, nor a drunken snow-plough pilot (pilot, is the Russian word for driver of a performance vehicle) who has lost his bearings.

For most certainly, the English writers of today’s most droll and incredible fiction, are naught, if not but tenant farmers’ thatchers. And with a very great track record too of scandalous adventuring in foreign lands. Sandline, the Du Toit escapade, The Malaysia government roadbuilding kickback scandal with the chief accountant for Public Works Francis Raj and John Major,The Seychelle attempted overthrow, the BAE kickback deal with Prince Bandar, and the BAE military radar system for Mugabe. No. No indeed, we do not do anything wrong, immoral or grossly improper and illegal! Ever. Fancy saying that we do! Fancy that! My god – CABAL! (Clifford Arlington Buckingham Ashley and Lauderdale). It is not US!

ISIS is a Cambridge Apostles, Cambridge University private magazine by the way. Just thought I’d remind you. Who did buy that Paris property for 900 million last year too – from the ex Head of State Security of Syria? Anyone know?

You would have to have a lot of money and a lot of balls and considerable credibility to push that line of questioning in the media.

It wouldn’t be me, certainly. It would be someone with a huge grudge against the people who threw charges at you for selling oil illegally to Burma. Say someone like, Total Oil.

(A little bit... has been deleted. But just a little bit.)

Signed

William Shakespeare

Death of Whitlam

I came on a great house in the middle of the night
Its open lighted doorway and its windows all alight,
And all my friends were there and made me welcome too
But I woke in an old ruin that the winds howled through,
And when I pay attention I must out and walk
Among the dogs and horses that understand my talk.
Oh what of that, oh what of that,
What is there left to say?

– W.B. Yeats, ‘1924’

This pic is on THE LEFT!
E.G. Whitlam

 

Re-posted from a column by Doyen Australian Journalist Bob Ellis (Tabletalk 21 October 2014)

 

Edward Gough Whitlam was the greatest Prime Minister Australia ever had.

 

At age 92 he said that he felt proud that Australia 'now (at the time) had a Prime Minister who could speak Mandarin, and, by the way' he added 'America is looking forward to the day when it will have a President who can speak English!'

 

'I like the correct use of the English language,' he said on another occasion. 'I am not immortal, no, not immortal; I am eternal.'

 

Did Australia ever deserve someone as great as Pompey?

 

It had one whether yes or no. 

The Caulfield Cup, and 'Risk...'

I know this big big business guy, who has recently been going around with a fairly dismal expression on his face. And after talking a bit with him, it seems he is worried about ‘risk.’

Things have changed in the wider economic world of course, and in the marketplace, suddenly, ‘risk’ is posing greater and ever greater concerns to all the Jedi knights of finance.

 

It's still cash...

I would say it is due in no small part to the pretence of low interest rates at the risk free rate fabricated by the US Federal Reserve Bank; the rewards having now become meaningless versus the baseline of risk and the risk curve rising from that baseline.

‘Risk’ is more natural and easier to understand when the Fed is not interfering with the price of money – but now that we have the unorthodox situation that we do have though, let me approach the subject also in an unorthodox way.

A race horse does not absolutely need to be the winner of any particular race regardless of all the factors in its favour; there are no guaranteed winners in horse racing. And this is why expert horse people talk about things like courage, and bravery, and style, and spirit - even luck too.

A courageous horse is really, the underdog in a given race – to mix metaphors – and when it shows the willingness to push itself, against some big negatives, into the chance of actually winning, horse people say the animal has shown courage. Today, the world’s richest handicap race over a derby distance was held – namely, the Australian Caulfield Cup. And it was won by a very good horse from Japan.

Tiny mare Miracles of Life

Winner of the Perri Cutten Sprint

But I want to talk about the sprint race before the Cup – the Perri Cutten Sprint. And I want to talk about a horse I have mentioned here before, Miracles of Life. This mare is a small horse by comparison to the other horses around it in the races it runs in, and whilst as a two year old it was better able to match strides and mass and power with the other runners all of the same age and also similar size, build, and maturity - as an older horse which never really grew a whole lot bigger than when it was two and three, it shouldn’t really be able to match strides with its present company.

Well anyway, Miracles of Life won the sprint race today, and it did that on courage, and spirit, and power and ability, and sheer quality as a race horse. The fact is it shared the win in a rare situation because it dead-heated for first with a very much older horse called Bel Sprinter - though a horse also with a ton of ability but which has had to come back from major injuries.

Dead-heating is a very rare thing these days because of the camera technology that allows the smallest of margins to be decisively determined. In this case the dead-heat was not only a fair result, there was almost something noble about it; the small mare should have ‘naturally’ gone down with the older reliable horse being the ‘predictable’ winner. She was not really entitled to be anywhere near where she was. Indeed she was entitled to be beaten badly.

But that is what makes horse racing interesting to old hands.

When you are a very wealthy person, and you give your money away to build schools for children, because you already have a diamond watch and too many sports cars and too many women that give you too many problems (all of this I got from a Jackie Chan documentary, by the way), why then your life could get boring and you could easily become jaded and cynical.

Taking a risk is no longer about losing everything you have, once you are an old hand. It’s about the joy of the ethereal consequences in the event that ‘you’ win; or that your horse does, at least.

And the joy is not about the cash; it’s about the meaning of the victory.

So if I were to reduce the story down to clear cut principles about the taking of risk, they would be like this: ‘you are not really entitled to make a million bucks from some venture run over a mere handful of weeks, and all from some miniscule cash investment – but if you are using real courage, real knowledge, real judgement, real bravery, real intellectual ability, and then, should you happen to derive a fantastic result (which was never guaranteed), the thing becomes extremely personally meaningful, and it is definitely worth the money cost and the human effort.’

"Waddya think you're gonna do?
Waddya think yer gonna do?
I tell yer what - don't think; do! Something. Anything.
I don't care what. Just do."

Real bravery, real courage, real knowledge, intellectual ability – have nothing at all to do with anything you will ever see on televised business commentaries, or in research reports from investment banks or stock brokers, or even in academic courses. These things are about you not being at all even entitled to be ‘in the hunt’ or ‘in the race,’ as they say; but a race nonetheless which you compete in. These things are about you going ahead anyway and placing yourself ahead of all of the competition in the hunt for the big money prize.

You need to start in the race. That’s fundamental. Too many who are prepared to call themselves businessmen and even bankers and financiers today, aren’t even ‘in the race’ as such. They are all pontificating on the sidelines waiting for some amazing market opportunity that is guaranteed to be in their favour at no cost and no expense and no risk but with some exciting prospect of reward all the same. That is what false pricing of dollar cost has created in the mindsets of the modern businessperson.

These people are confusing investment markets reflected on exchanges, with business and business risk. The two are totally different things.

And I have never seen a better time for engaging in real business, and a worse time for market investments and market investing.

A Great Wine

I want to be reasonable about this – there is such a huge demand for French wines these days that manufacturers are forced to extract every drop of commercial liquid out of the limited absolute supply. This is the same kind of thing that the producers of Chanel No 5 face – when it was first made and sold to the world, certainly much less than a hundred thousand litres per annum was manufactured; today, the total amount is in the millions of litres. There is no possibility that the same kinds of ingredients or the same process is used today to make what is sold as Chanel No 5 – as if it were really anything like the original. And that is to be unkind to the great success of the whole thing as an idea, as a brand, as, even – an ideology, really. At least an ideology of style anyway.

 

A French actress has been chosen

as the Bond 24 bond girl...

Champagne is authentic if it comes from Champagne and carries the required appellation stamp.

But if you want to know the truth, dosage is the secret of much of modern Champagnes. Most of the wines are not too old, are mostly just the de-stemmed flesh without the skins, and they get dosed with a Champagne syrup that has a great concentration of sugars and also, of flavours too.

And that again, is to be a touch unfair to the modern world. We spend our days differently to the mi’lords and mi’ladies of the original days of the Follies Begeres, who would gather around the outer vestibule of the Crazy Shepherdess’s, and drink Champagne. Today, we spend much of the day at a keyboard or keypad, drinking in a tide of electrons and digital meaning.

A hint of pencil shavings!

The other day, someone wandered around my own house looking for a pencil sharpener for a disgruntled child, and, thinking only about a pencil’s association to kids, I entirely forgot about my own collection of silver Faber-Castell sets...

And it was somewhat of a shock, when at last a sharpener was found and all of the adults suddenly noticed the charming redolent scent of pencil shavings!!  So quickly we forget what was once the commonplace.

Authenticity has its place and often it is decried as merely nostalgia – nostalgia being something to be criticised, apparently.

 

But let me say this, if you want to experience what a truly great Champagne once was really like, may I suggest something like a very modestly priced Australian, Red Label Wolf Blass Chardonnay Pinot Noir Sparkling Wine. You will not easily find a more elegant, refined, seamless, indeed quite stunning wine anywhere in today’s world, and not for any kinds of money. Wolf Blass makes a lot of wine, and of many styles. But not for nothing has this maker managed to take off second prize in the whole world against all comers in a blind Paris tasting several times in recent years. Not for nothing.

 

Sochi Formula 1

Why was the meeting between Putin and the ruler of Bahrain al Khalifa held today at the Sochi Formula 1 race track?

Al Khalifa of Bahrain and President Putin

at the Sochi Formula 1 race today

 

Because, the air routes had been high prioritised into Sochi due to the running of the race.

 

Nobody knew this meeting was to be held. It was arranged secretly, and the flight took only four hours for the King of Bahrain to get there from his palace in the tiny Gulf Kingdom.

 

However, it ought not to be lost on anyone who watches these things closely, that previous to this meeting, Bahrain had been employing 'contractors' and 'consultants' led by the ex-London Met policeman John Yates - several million pounds, by the way - to provide ideas and strategy about how to prevent the 'Arab Spring Fever' from infecting the Kingdom of Bahrain.

 

And so this meeting with the President of Russia, the despised and sanctioned leader of the New Eurasia World Order, is a bit of a policy departure by the Bahrainis.

 

Highly staged pic!

 

What could VV possibly have told Hamad al Khalifa that could have persuaded him away from his wonderful English buddies who were naturally always out to just help the King of course. He should not have needed to cosy up to Vlad, shake hands and smile for the cameras and all that...

 

 (A final paragraph has been deleted. For those who read it, just forget you ever read it!)

 

 

Armchair Analytics

Dennis on left, with Jon Snow,

the well-known British Channel 4 journalist

 

Felix Dennis died a few months ago.

Felix who?

Dennis was the owner of Maxim magazine, which I suppose, may provoke some recollection of who he was in the minds of some people.

Actually, he was one of the most dangerous and feared figures in the minds of today’s Hard Right political elite (what does that mean, ‘elite?’).  For one thing he was enormously wealthy, a billionaire in fact. The media around the world has studiously kept him out of any of their publications for decades. He was certainly one of the figures behind the funding of Julian Assange.

The history of Felix Dennis begins a lot earlier than with the inception of Maxim magazine. But to cut a very long story short, when countries like Australia, currently led by an idiot, start throwing darts at Russia and China, it’s no wonder that the Chinese government can have actually said Australia’s present foreign minister was a fool!

Well, the present era political Hard Right, has suppressed the names of people such as Felix Dennis, and Richard Neville, to the point that they no longer know of these identities themselves or what they represent and what their existence might mean.

Down down, deep down in the undergrowth, there are things going on that would make even idiots choke, were they to know...

 

God, you should have seen the pic I first uploaded here

and quickly deleted!!

Not many modern Australians know that ASIO – the perceived Australian National Security Agency (which it is not, by the way) was conceived as a political tool of Prime Minister Menzies; it was specifically a political security agency, not a general Federal or National one. And that is why it has no clue about what is really going on ‘under the radar’ as it were – because it does not involve itself with business espionage or banking problems or economic threats, and largely actually takes orders from an overseas-based English Hard Right political elite which controls all of the Right side of the political landscape in Australia, and is sensitive to superficial political vectors only, and not to economic or industrial ones.

It will, though, interfere, and has in the past, interfered with the handing out of banking licences, for instance, if only because of the political obviousness of this kind of thing. But in the modern world, economic power is not so obvious, especially if the media has studiously gone out of its way to pretend certain examples of it – for their own political reasons - didn’t actually exist! It makes such groups of people very easy to hide themselves and their activities and not even ASIO or the NSA will realise anything is going on because there is no ‘red light’ as it were, under those concerned.

Dennis had, and wielded, simply enormous economic power and he had sway with a lot of Left-sympathizing jurists. And he managed to remain unnoticed for most of the time that he exercised his influence. I could say more, I suppose about what tomorrow brings, but then, neither would I wish to hand everything gratuitously over to fools and idiots and their minions. I would much prefer to see all the cards fall where they may and where they must, wouldn’t you? We won’t have to wait long. Clive Palmer says 1 month, and I agree with him.

Please don’t come knocking on my door afterwards and say ‘what did I know?’ I ‘didn’t’ know anything.  I am strictly an armchair quarterback.  Here's a clue though - in the background of the first pic, take note of the cafe's name. It means something. John Galliano knows what I'm talking about.