Sunday, June 30, 2013

Alastair Campbell: still fighting the last war

The Mail on Sunday's Simon Walters has a go at Alastair Campbell, for comparing Blair's misinformation about WMD to Churchill's "bodyguard of lies"wartime deceptions.

This came from a speech Campbell gave on Thursday in Australia, and the full text is on his blog here, which doubtless is where Walters got it from. We are in an era where the commentariat do all their sleuthing via armchair data mining (as I do, but I don't have their salary or expense account).

In a fight between two unsavouries, I find myself rooting for neither. Campbell's speech was about presentation in an age of easy fisking, and accordingly it's easy to reverse engineer Walters' attack and show what really happened and how angled the MoS piece was.

On the other hand, Campbell's fearsome rep as Number 10 spinmaster was founded on his knowledge of journalists' own personal vulnerable areas. In 2009, he put a shot across the bows of Andrew Marr, who had asked awkward questions about the then PM Gordon Brown's medication. Campbell wrote on his blog:

"It was sad to see Marr, perhaps with an eye to a few Monday morning cuttings, feel that he had to raise blogosphere rumours about Gordon going blind, or being on heavy medication of some sort. I know it will give him the passing satisfaction of pats on the back from journos … But it was low stuff. I'm sure Andrew would agree that everyone has certain areas of their life that they'd prefer not to be asked about live on TV."

It was a clear threat to disclose what Marr was at that time trying desperately to conceal, namely the story about his alleged love-child. Interestingly, this is no longer on Campbell's blog. Down the memory hole goes that piece of yesterday's news. Will we have to copy and paste everything in future, just to be sure it doesn't get "lost"?

Campbell seems still to be working to rehabilitate the reputation of his former boss Tony Blair (described by Clarissa Dickson-Wright in her first autobiography as "a mimsy psychopath"), and as the IRA told Margaret Thatcher, "We only have to be lucky once." I wish he would give it up: it's not just the Coalition lives lost, it's the Iraqi deaths too, running into six figures. But of course he won't stop, because his own reputation has to recover too. The Dodgy Dossier clanks behind him like Jacob Marley's account books.

In fairness, here's the bit from Cambo's blog that Walters semi-misused:

There has always been comms. There has always been public affairs. There has always been PR. There has always been spin. Read the bible for heaven’s sake. What is new is not spin but the reality of a globalized media age, an information economy, a world where technology is accelerating the pace of change on an exponential basis. Nor have there been political and media systems which for most democracies mean that even if people wished not to tell the truth, the pressures are all to do so, and woe betide those who don’t.

That’s not always been the case.

I read a book recently on the relationship between (SLIDE 8) Churchill and de Gaulle, who could regale each other with stories of their public deceptions, and perhaps in doing so deceived each other too. Another recent book, Ben Macintyre’s Double Cross, showed how Churchill got actively involved in the preparation of what he called the ‘bodyguard of lies’ to accompany the truth that an invasion across the English Channel was being planned. Macintyre states as a fact that after the invasion, Churchill lied to Parliament to keep various deceptions going.

Yet if the pollsters were to do a survey, who had a greater commitment to wartime truth, (SLIDE 9) Churchill in World War 2 or Tony Blair in Iraq? I think we know what the answer would be … it just wouldn’t be true. Interesting paradox in a world full of them.

Mr Campbell, too, has his interesting paradoxes.

Who is the Mail's "David Rose"?

UPDATE (3 June): It's NOT Hari:


Yet another excited boost for critics of the climate change lobby in the Mail on Sunday today, by David Rose, who sees our economic salvation in near-limitless shale gas and lambasts green ninnies and nimbies.

He may be right. But does he exist?

I can't find this "David Rose" on Twitter - it's not the deputy news editor by that name:

- or on Facebook.

Debate on his existence has swirled about the internet for at least a couple of years - in 2011 "Jack of Kent" seemed to be speculating that it might be Johann Hari in disguise.

He appears to have phoned cannabis legalisation campaigner Peter Reynolds last year, who includes this photo of him:

- which seems to have been taken by someone at the Guardian, if you look at the photo credit here.
And it looks like the David Rose in this video, interviewing Binyam Mohammed in (I think) 2009.
Yet he seems so elusive that I still suspect this climate-sceptic "David Rose" to be a dummy, a byline for thirdhand material from undisclosed sources that the Mail wants to put in as propaganda and disinformation.
A shame, because there's proper debate to be had. If you really exist, Mr Daily Mail Science Writer David Rose, please do step forward out of the shadows.

All original material is copyright of its author. Fair use permitted. Contact via comment. Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog; or for unintentional error and inaccuracy. The blog author may have, or intend to change, a personal position in any stock or other kind of investment mentioned.

Saturday, June 29, 2013

Lions and donkeys

It's Armed Forces Day and concidentally I've just finished reading David Blakeley's "Pathfinder". This book is about a 2003 UK special forces mission behind enemy lines in Iraq and it's full of lessons, including a couple that the British Army should have learned long ago.

As the US Marines seized Nasiriyeh, a town that against military intelligence analysis had turned out to be strongly defended by some of Saddam's most committed troops, a small airfield at Qalat Sikar, some 80 miles behind the enemy's front line, became an important part of the battle plan. If this could be secured by the Parachute Regiment it would be a valuable stepping stone for the advance towards Baghdad.

The job of the elite Pathfinder (aka PF) platoon is to get vital on-the-ground intelligence while risking only a few personnel. The obvious tactic was for them to get to Qalat Sikar by para drop, but air resources were not available. So instead, they had to take three Land Rovers straight up the road, with a network of rivers and canals (not on our maps) on one side and wooded, difficult terrain on the other. They passed a number of previously unsuspected Iraqi positions but were spotted at last and a big Toyota pickup-borne Fedayeen ambush set ahead for them.

The team called HQ but were told that there was no possibility of air strikes or evacuation by helicopter. So the only option (other than a long, almost certainly fatal Bravo Two Zero-style foot-slog) was to drive back again, this time through a series of ambushes by a fully-alert enemy. This was running the gauntlet with a vengeance, and only a combination of acutely-honed mobile firing skills, courage, improvisation and luck got them back to the Marines alive and (scarcely believably) unhurt.

There had been far more enemy than the intel had suggested, maybe two thousand very well-armed troops in a number of locations along the road. They had not been spotted by satellite and were well dug-in and camouflaged. But thanks to the PF excursion their positions were now known and Blakeley and co. passed on the information to the Marine commander, who called in air strikes that cleared the way for the Coalition forces to speed northwards.

Blakeley comments more than once on the difference between resourcing for the Americans and the Brits, and how we are so often the poor relation. The whole gauntlet could have been avoided if we had had (or diverted) what was needed to do a HALO (high altitude, low opening) para drop; the adventure they had makes for a stirring story but luck and courage shouldn't be the core of your plan. I recall a programme about the early days of the special forces Long Range Desert Group in North Africa in WWII, and how when someone asked about food for the long missions behind and back from Rommel's lines, an officer said the men could "live on their fingernails". Is there something about British leadership that prefers Captain Scott to Ernest Shackleton?

And then there is the attitude of the Ministry of Defence to its own when they are most in need. Blakeley was severely injured in a vehicle rollover not long after the Qalat Sikar escapade, and on getting home to recuperate received a form letter warning him that if he was on the sick list for more than 18 months the Army reserved the right to terminate his contract. "It didn't even wish me a get well soon. Nice. I was a war-wounded soldier just a day out of hospital. I'd taken a look at the name of the MOD pen-pusher who'd signed it, and I'd memorised it. I resolved to meet up with him in a dark alleyway sometime in the near future, and get even. It's still on my list of things to do." His spirits were raised instead by a handwritten note from Prince Charles, accompanied by a vintage bottle of the Prince's own Laphroaig. What a contrast; and a similar MOD letter is presumably sent to many others in the same plight. All that Army training manual stress on morale and leadership, and not two minutes' thought given to standard official communication with men at their most vulnerable.

Penny wise, pound foolish. In his SAS memoir "Seven Troop", Andy McNab contrasts the mental health support given to US Special Forces personnel with its lack for their British counterparts, commenting that given the huge expense of recruiting and training elite soldiers, adequate psychological counselling for them would make sense merely from a coldly financial point of view.

The negligent attitude extends to soldiers' families, or used to. When our father broke his back in Aden in the Sixties and subsequently lay crippled in hospital, his pay was frozen until one day our mother packed some food and drink and took my little brother to the Army offices, and told them she and he were staying there until she got something to live on. It worked, but it shouldn't have had to.

It's nice that Mr Cameron has flown out to see the troops in Afghanistan, though I'm not quite sure who is gaining more. Our military commitments are heavy and the future darkly unpredictable, yet thousands of regular soldiers are being made redundant and TAs are expected to take up the reins and defend our country and our national interests on the cheap. Perhaps we should rely less on luck, pats on the back and sentimentality, and weigh the potential costs of defeat against those of adequate defence provision.

All original material is copyright of its author. Fair use permitted. Contact via comment. Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog; or for unintentional error and inaccuracy. The blog author may have, or intend to change, a personal position in any stock or other kind of investment mentioned.

Friday, June 28, 2013

Killing the small investor

Yesterday at Marylebone railway station, London, I saw a banner poster from Blackrock Investments, urging savers to consider getting out of cash (with the usual perfunctory, statutory warnings about risk).

Yet according to Testosterone Pit (htp: John Ward), the smart money is dumping investments as fast as it can:

“We think it’s a fabulous environment to be selling,” said Leon Black, CEO of PE giant Apollo Global Management. With stock markets having more than doubled since their 2009 lows, average prices for leveraged buyouts have jumped to nine times earnings, he said. His firm had already dumped about $13 billion in assets over the last 15 months. “We’re selling everything that’s not nailed down,” he said.

This reminds me of 1999, when an investment house sent its representatives around to IFA meetings to persuade us to encourage our clients into tech stocks because of the coming second, "super-boom". I smelt a rat and suspected that our mom-and-pop savers were being set up to help large, favoured clients cash out of their positions. 

The stockmarkets (Dow and FTSE) have halved twice since 2000. I had hoped that when the first crash bottomed out (2003) we would be back into a sensible investment environment, and if that had happened I would probably still be in the industry, since I could have squared investment recommendation with my professional conscience. I hadn't reckoned with our wildly irresponsible governments, who flooded the market with cash and created the property bubble, then crashed interest rates and pumped in more cash to support the busted banks.

So, down twice, up twice - and now, possibly, about to go down for the third and final time.

Meanwhile, I have been trying for over a year now to get my MP merely to ask a question in Parliament about the restoration of safe, index-linked investments for ordinary savers. No joy. Apparently we are to be thrown to the wolves.

All original material is copyright of its author. Fair use permitted. Contact via comment. Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog; or for unintentional error and inaccuracy. The blog author may have, or intend to change, a personal position in any stock or other kind of investment mentioned.

Thursday, June 27, 2013

Indolent charity

The only difference between Timmins's dinner and his neighbour's was, that he had hired, as we have said, the greater part of the plate, and that his cowardly conscience magnified faults and disasters of which no one else probably took heed.

...guilty consciences, I say, made them fancy that everyone was spying out their domestic deficiencies: whereas, it is probable that nobody present thought of their failings at all. People never do: they never see holes in their neighbours' coats—they are too indolent, simple, and charitable.
William Thackeray – A Little Dinner at Timmin’s

I suspect many of us have what Thackeray calls a cowardly conscience – imagining that other people pay more attention to us than they ever do.

Yet many people in public life appear to have no such thing, or rather they understand what Thackeray might have called the simple, indolent charity of their audience. They are well aware that their inadequacies may be obscured behind the crudest dishonesty, misdirection and sheer chutzpah so essential for serious political aspirants.

All original material is copyright of its author. Fair use permitted. Contact via comment. Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog; or for unintentional error and inaccuracy. The blog author may have, or intend to change, a personal position in any stock or other kind of investment mentioned.

Ethical investment in African farming

See Josh Altman's new piece on the Agriculture Page.

Money is Pouring into Farmland Investments in Africa - But Can They be Ethical as Well as Profitable?

As the average age of populations in western countries continues to creep slowly upwards, institutional investors such as pension funds are increasingly seeking investments that throw off a steady stream of income with dependable increases in capital gains. One asset class that has seen a huge inflow of investment into it is farmland, as many investors are very favorably disposed to the asset class due to the ongoing agricultural "super cycle" as coined by noted farmland and commodities investor Jim Rogers.

In the UK for example, over the last ten years, agricultural land has appreciated roughly 13 per cent per year in the according to Investment Property Databank (IPD).  The US and other Western countries have seen similar farmland investment returns. Farmland prices have therefore skyrocketed, reaching as high as £17,300 (approximately $30,000) per hectare in the northwest of England to take just one example.

As a result, investors are increasingly turning their interest in farmland investing to areas of the world where prices are starting from a much lower base, thereby providing much greater upside potential. One area where this has been particularly prevalent is Africa, where hedge funds and other large institutions have been making large agricultural farmland investments. Hedge funds and private equity funds alone have purchased 148 million acres of farmland in just the last three years. Just to take one example, last year the UK’s well known Guardian newspaper outlined how a full 5pc of African agricultural land had been purchased or leased by outside investors, and that more than 200m hectares (495m acres) of land – roughly eight times the size of the UK – were sold or leased between 2000 and 2010.

Given the long history of colonial exploitation in Africa, there has been increasing resistance to what is perceived by many Non-Governmental Organisations as well as African citizens as a “foreign land grab.” Whilst some of these feelings may be based on old stereotypes rather than current conditions, there is no question that some abuses have occurred. Just to take on example, in 2009 the US magazine Businessweek had a comprehensive piece detailing abuses by an American investor named Dominion Farms - this article is well worth a read if you want to understand the legitimate concerns many Afrricans possess regarding foreign land investments in their countries.

Large institutional investors frequently make deals directly with the central governments of African countries, and unfortunately, given the amount of corruption and generally poor governance that still exists in Africa, the investment capital frequently disappear into the pockets of corrupt local officials whilst local farmers are forcibly removed from their homes and lands.

By the same token, it is far from true that all foreign investments in African farmland are predatory and exploitive.  Global consultancy McKinsey recently produced a report on the future of Africa which noted that the continent had over 25 per cent of the globe’s arable land yet produced only ten per cent of agricultural output.  McKinsey argued that up to $50bn/year of African agricultural farmland investment would be needed to bring the sector up to global standards and allow African agriculture to maximize its potential output.

Given the need for investment in African agriculture, there is no reason that foreign farmland investment on the continent cannot be structured as a win-win for both private investors and the host country populations. With the right guidelines and intentions, foreign investment in African farmland can be both ethical and profitable.  The major issue is whether a set of basic principles for “win-win” farmland investment in Africa can be developed.  Just as an example, the following principles can be used to evaluate the fairness of foreign farmland investment in Africa:

1. The farmland investment was negotiated directly with local villagers and tribal chiefs, so there was no chance for corruption at senior government levels;

2. The investment was directed at completely unused land, and none of the local population has been removed from any of the land since it was not in use as a food source;

3. Farmland investments in developing countries should not simply be premised on the food security concerns of the foreign investors, who may want to simply ship the entire crop production back to their home countries;

4. The workforce should as much as possible be local hires who should be paid a fair wage well above the minimum for that country; and

5. Finally, foreign investors in African farmland should also have at least some kind of community re- investment programme in the host country.

Whilst these principles will not solve every concern of local African NGOs, they are at least a starting point for considering examining whether a farmland investment is structured as a win-win for both the investor and the local population, or if the investor is behaving in an inherently exploitative manner. One other interesting factor is that when farmland investment projects are structured such that retail investors can participate, the project is more likely to be fair, as individual investors are much more likely to demand that any project they are involved with be both ethical and profitable.
Josh Altman is with GreenWorld, an alternative investments firm specializing in such areas as forestry and farmland investments. The aim is to allow smaller investors to access such stable, "hard asset" alternative investments that pay high current income and also offer excellent opportunity of long-term capital gains. GreenWorld is on the web at

UPDATE (22.01.2017): GreenWorld appears to have ceased trading and the website has been taken over by another user.

All original material is copyright of its author. Fair use permitted. Contact via comment. Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog; or for unintentional error and inaccuracy. The blog author may have, or intend to change, a personal position in any stock or other kind of investment mentioned.

Sunday, June 23, 2013

Oxford reunion, 40 years on

See World Voices for this year's midsummer revelry under a magical moon.

Ridley the GM supporter vs. Ridley the green farmer?

Running with the hare, or the hound?

Guy Adams' article yesterday, "The Frankenfood Conspiracy", details the tactics used by the Big Three companies behind genetically modified food.

As with so many other aspects of public life, it seems that decisions are now influenced not by electoral or opinion polls, but by commercial interests that know how to gain the ear of political power.

An interesting nugget from this piece concerns the self-styled "rational optimist", member of the House of Lords and pro-GM writer Matt Ridley:

"Environment Secretary Owen Paterson’s wife, Rose, is the sister of Viscount Matt Ridley, who is better known as the former chairman of Northern Rock. After presiding over the bank’s collapse, he has concentrated on his career as a pro-GM blogger and science writer.

"Has Ridley had formal or informal discussions with his brother-in-law the Environment Secretary on the subject of GM? DEFRA couldn’t tell me.

"Matt Ridley did not respond to our request for a comment."

In the House of Lords Register of Members' Interests, Viscount Ridley lists a shareholding in Blagdon Farming Ltd - the Blagdon Estate has been in his family since 1700. The farm is certified by the LEAF organisation, which promotes "environmentally responsible" principles and collaborates with (among others) the RSPB, WWF, Waitrose and the Crop Protection Association. The Blagdon Farm Shop says, "We only sell food that has been produced by farms that are either organic or follow traditional farming methods, that are kind to the natural environment."

Very reassuring.

On the other hand, Ridley is also a shareholder in California-based genetic research company Illumina Inc, which includes "agrigenomics" among its fields of interest; and Greggs, the UK bakery shop that has more outlets here than McDonald's. Food for thought...

He is also an "occasional speaker" (three times between February and April this year) via Chartwell Partners. The speeches were:

1. When Ideas Have Sex
2. Reasons To Be Cheerful: How Prosperity Evolves (video)

... and (3) a talk at Suboptic 2013, summarised in part thus (on page 5):

"The secret of human prosperity is that everybody is working for everybody else. In this talk Matt will explore the ways that the cross fertilisation of ideas leads to prosperity-enhancing innovation, drawing an analogy with the way that the recombination of genes leads to genetic innovation..."

The reader might be forgiven for thinking that there is some possible inconsistency with being a landowner whose family farm makes much of its "organic/traditional/environmental" values, and being a journalist, writer and speaker who advocates the benefits of genetic research in feeding us all.

All original material is copyright of its author. Fair use permitted. Contact via comment. Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog; or for unintentional error and inaccuracy. The blog author may have, or intend to change, a personal position in any stock or other kind of investment mentioned.

BLOGGER ALERT: EU now makes its big power grab

The European Central Bank has given itself permission to take control of Europe via the economic system. The news comes via a small item buried in the Telegraph website, but John Ward sees this as a dangerous watershed.

Please read his article and if you agree, promote wider readership via your own electronic connections.


Slipping quietly onto the Telegraph’s website at 10.45 pm Thursday night was this potentially earth-shaking piece (the italics are mine): ‘EU agrees rules on bank rescues by bailout fund: using the €500bn rescue fund to shore up struggling banks directly is a pillar of Europe’s so-called banking union, which seeks to hand European institutions the job of supervision and rescue rather than leaving weaker member states to fend for themselves.’ It came to nine lines in total, attracted six comments, and has now been reduced to a tiny sub-head 75% of the way down the Finance page.
History will come to see this as perhaps the outstanding media miss of the entire eurozone crisis.
It’s entirely contrary to the Lisbon Treaty of course – but let’s not worry about that: Gordon Brown never wanted to sign the bloody thing anyway. The more important point to make here is that the steam coming out of Bundesbank President Jens Weidmann’s ears yesterday will have been enough to power the Frankfurt U-Bahn for a year at least.

“Central banks in recent years have been pulled into the role of a crisis manager,” Herr Weidmann told Finnish newspaper Helsingin Sanomat in an interview four months ago, “Some think that central banks are the only able ones. I consider this thinking wrong and dangerous”. A consistent anti-ECB direct aid hawk, Weidmann is one of the few German élite members who talks consistent sense….and, privately, has come to realise that Chancellor Merkel is an unbalanced egomaniac.

But it’s beginning to look like the Anti-ECB Hawkeyes are being stitched up by Berlin.

What we’re seeing here is the megastate technocrats of Berlin-am-Brussels handing absolute power to the unelected….at the expense of the citizen. Merkel and Schäuble may dislike what the Demon Draghi has achieved at their expense, but that’s a tiff about power, not principles. The very fact that we are getting the direct ESM usage with no sign of Fiskalunion (which wasn’t what last year’s summit agreed) means that all the power now resides in the hands of the man with the printing machine: Mario Draghi.

The Merkeschäuble would prefer that power to lie with them, but they’re on the same mission as the Italian Machiavelli from Goldman Sachs.

Take the Karlsruhe ‘decision’ on the Constitutional or otherwise nature of the German Government partaking in eurozone OMT. The facts surrounding the case are beginning to suggest Merkeschäuble political interference on a grand scale. While the Court was meeting earlier this month, I was under the distinct impression that Karlsruhe would give a decision by the Friday of that week. Contacts across Europe and the US were of the same opinion.

So too were the German media.

This from Spiegel June 10th last: ‘alarm bells are again ringing inside the ECB tower — only this time it’s no drill. On Tuesday and Wednesday of this week, Germany’s Constitutional Court in Karlsruhe will rule on the euro crisis aid measure that Draghi announced last fall. As Draghi and his monetary experts on the executive floor of the bank were told by their constitutional experts long ago, this court decision could have an enormous impact on the bank’s policies — and potentially spell the end of the euro.’

But then three days later – the day before the decision was due – the June 13th, Time Magazine was saying, ‘The court will deliver its ruling in the fall, probably not before the German parliamentary elections on September 22.’

Very handy, that. Especially as it was widely known in German élite circles that the decision was on a knife-edge: Wolfgang Schäuble was briefing and spinning like an overactive Dervish for the entire week. He obviously didn’t think the portents were good.

Now the shroud around all this is getting increasingly diaphanous.

This is what it says on the Federal Court’s website today: “We regret not to be able to present to you the decisions of the Federal Court of Justice in English language. The court has no staff, capacity or equipment to do so.”

Sorry folks, but LOL or what?

Leading German anti-OTM camapaigner and eurosceptic Peter Gauweiler has led the Karlsruhe suit from day one. He seems able to afford English translation of his views….but not Germany’s Federal Court.

When I rang the Bundesbank press office this morning, they declined to comment. Funnily enough, so did the ECB.

We need to take this on board in a big way – even if the mainstream media are half-asleep on the EU’s fascist illegality, and Berlin’s willingness to ride roughshod over its Constitution.

We still await the ECB capital flight data. It was due for publication on June 17th. It’s now June 21st: where is it?

Get real, people: Mario Draghi is the most powerful human being in Europe, and he is a crook. He is subverting European democracy and breaking any law that gets in his way.

Mario Draghi is a former senior manager at Goldman Sachs. He recently gave a presentation to EuroFinMins openly encouraging a policy of reducing citizen incomes to cut production costs: that is antithetical to Article 3 of the Lisbon Treaty. He has now been given carte blanche to supply money direct to any eurozone institution, thus bypassing all democratically elected Assemblies in the region. This too is forbidden under the Lisbon Treaty. Mario Draghi is completely unaccountable to any body or institution – elected or otherwise. Under the ECB’s Constitution guaranteed by the European Commission he is totally immune from prosecution. He cannot be removed from his position. He is obviously censoring any and all information that might reveal the true situation in the eurozone. He illegally subordinated an entire class of bondholders over the second Greek bailout. He managed and spearheaded an overt heist to steal the banking expertise and economic wellbeing of Cyprus, and in so doing committed an act of grand larceny against innocent depositors in the Island’s banks.

As of today – following the FinMins’ disgracefully amoral decision of yesterday – Mario Draghi has more power than Hjalmar Schacht and Josef Goebbels combined in 1941. And he is a far better political strategist than Adolf Hitler. Slugging it out with this gargoyle to be the EU’s top money manager is Wolfgang Schäuble: a lying humbug and former Spook enjoying the political protection of a former DDR Communist Youth leader – a Stalinist hardliner who speaks fluent Russian….Angela Merkel.

This is not a queue for the showers, European nations. It is the line heading directly to the extermination of your democratic rights, individual liberties, and personal wealth. There may be 27 of you and only one Draghi; but your divisions just make his job far easier. Step in the way of the Beasts now, or you will have a jackboot stepping on your face forever. 
I try as much as possible to keep these appeals to a minimum, but I am asking anyone interested enough to please email, share, tweet, text, reblog, and otherwise give this piece a maximum chance of viral epidemiology. The mainstream media are obsessed with superficial news, gossip and settling political scores, but in giving this decision a low profile they are in complete dereliction of their duty.

Saturday, June 22, 2013

UK: Gaudy

By the time I had parked in St Giles and collected my room key from the girl in the College porters' office, the dinner was ending. Changed into smart casual, I headed for Third Quad and the College Bar, passing wine-loudened stragglers in the dining hall, knots of blacktied alumni on the path and a servant watching a man being helped back into his wheelchair at the foot of the steps.

Second Quad, where the JCR (junior common room) used to be. This comprised four rooms:  first, an oak-lined room for morning toast and newspapers (and a small red-haired mathematician who would complete the Times crossword as fast as he could write the answers). This opened onto a second room with a TV, where we would watch Match of the Day and hold JCR meetings; the year before I came up, the students elected a goldfish as President (because like his predecessors, he went round in circles, opening and closing his mouth) and appointed an interpreter to convey the President's rulings. Across the stairway entrance, the Piggery, where they played poker and table football, and one Welshman would regularly smash the glass top on the Gottlieb pinball machine when he failed to get a replay.

Once, as the dons proceeded from sherry in the Senior Common Room to the dining hall, they were met with a hail of breadrolls from the open JCR windows as they passed; from then on, they simply used the path on the other side of the quad. Late at night, Bill, the medical student and rugby player, would shamble through the archway from Third Quad, stand solus in mid-lawn facing the Junior Proctor's room, drop his trousers and sing the Sheep-Shagger's Song in a hoarse, drink-exhausted voice. A decade or two ago, the bar (smartened and relocated) included a reference to his ritual in its decor, echoing the way that Oxford had become a theme park dedicated to a cute version of its history; missing the jab of atavistic defiance in his nightly bawling against authority. The decor has changed again, now that a new, ambitious generation is in possession and society here is restratifying (as a St Andrews graduate confirmed to us later that night); the low Gini Index days of the Seventies are gone.

Escaping the roar of the bar, I drank my vodka tonics and exchanged news and reminiscences with half-remembered faces. Below the College library (where one used to catch glimpses of a silent, white-haired professor of Celtic) once lay the evil-smelling toilets or "traps", graffitied ("beware of limbo dancers"); and the baths to whose provision an earlier Principal had objected, saying that the terms were only eight weeks long, and besides, he and wife went to Rhyl every summer.

I went out of the massive wooden side gate to get a lamb kebab from the large, clean van on Broad Street (no more dodgy late-night boiled hot dogs on Magdalen Bridge now, I expect) and got back in using the electronic key, for the days of open College premises have passed. "Weren't you at dinner?" "No, you only get to talk to two or three people and you can't hear anyway. What was the food like?" "Not bad, though there wasn't very much." "And the wine?" "Better than last time." The speeches had been few and short; the Principal had said that if this were America, the doors would have been locked and donations solicited. We expect to be invited back more frequently now, the retired and retiring, the greyhairs watching the smartly-attired whippersnappers walk past from their post-Finals celebrations. There is the sound of fireworks, startling a bat; youngsters are collecting each other and working out where to go; the lights come on in the Graduate Common Room.

A few minutes to go before the bar closes; last chance to get one or two more in. My friend strolls into First Quad to find a toilet and look for an off licence; comes back empty-handed and goes down the bar to get a couple of bottles of red. We sit on a bench in the moonlit sky, chatting to the late leavers. Isolated wisps of backlit clouds drift above the parapets; ghostly white birds wheel over the buildings at midnight; the moon's face appears at a crenel. It is Midsummer Night, and the stage is all but empty.

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Friday, June 21, 2013

Catlin's Indian portraits

Catlin's painting of Little Wolf

The National Portrait Gallery's exhibition of George Catlin's American Indian Portraits has come to Birmingham Museum (until 13th October). Well worth a visit, for the social history and the powerful personalities Catlin painted.

The NPG has published a hardback catalogue (£25, but currently available for as little as c. £15 + P&P via Amazon).

Thursday, June 20, 2013

How will shale gas impact the UK market?

See The Energy Page for Nick Drew's analysis of how even small amounts of shale gas could make the UK energy market cheaper.

Shale and the Price of Gas

When push comes to shove, people really don't understand markets very well. Perusing the increasingly lively meeja coverage of putative shale gas in the UK, we find people who say shale discoveries will bring down the price of gas, and seemingly even more who say it won't - including, remarkably enough, the shale gas lobby itself. Wishing, I suppose, to be cautious in their claims, some of them say the effect will be minimal.
At a meeting for concerned residents at a potential fracking site in West Sussex, a Cuadrilla representative was asked to comment on whether shale gas could drive down customers' energy bills. “We've done an analysis and it's a very small…at the most it's a very small percentage…basically insignificant,” said Mark Linder, a public relations executive at Bell Pottinger who is also responsible for Cuadrilla's corporate development. (Inde) 
Some PR he is, eh? At least he didn't say prices would go up, though we may be sure that in due course someone will - the whole renewables policy is a massive bet on this. The argument seems to be that under EU trading laws we'll be 'forced' to sell it to the wretched continentals, (read: they'll offer to buy it, and if the price is right we'll sell it !), thus neutralising any tendency to lower UK prices. (Even Peter Lilley seems to be willing to concede this.)

Let's put some perspective on this.
  • in 1994 a relatively small gas surplus in the UK brought down the price of (wholesale) gas by 60% in 8 months - and it stayed down for 5 years 
  • it went up again when in 1999 the UK became connected for the first time to the gas networks of the continent, where gas prices were higher - set by oil-indexed gas contracts. The quantities of gas being exported from the UK that effected this price-shifting arbitrage were relatively small (indeed, on a net year-round basis, extremely small, as UK gas was exported in summer, but there were imports from the continent in winter) 
  • US gas prices have been absolutely trashed by substantial amounts of shale gas, and have stayed low despite warnings for several years that this can't go on. Of course, as yet they are only able to export very small amounts of the net North American surplus (the US is still a net importer, from Canada). 
So: gas prices like other prices, as any fule kno, are frequently set by marginal effects, and move in the predictable direction. Surplus => down, just to be clear ... If there is any economically recoverable shale gas lurking there, its directional impact on price is not in doubt. If and when it is produced in fair amounts (say, equivalent to 10-20% of UK demand - a lot less than some predict will flow) it will have the potential to impact on spot-gas prices not only in the UK but in Europe as a whole.

The absolute effect of this will hinge entirely on the detailed supply-demand dynamics of the time. This being a good few years into the future, we have no idea whatever what those will be. OK ?

PS: The Horizon programme on shale 'n fracking was fairly balanced and well done. It's on again this evening, and here.  

This post first appeared on the Capitalists@Work blog

All original material is copyright of its author. Fair use permitted. Contact via comment. Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog; or for unintentional error and inaccuracy. The blog author may have, or intend to change, a personal position in any stock or other kind of investment mentioned.

Saturday, June 15, 2013

New energy sources just kick the can

"Fire ice" is a term to intoxicate the word-lover. The substance is methane hydrate (or clathrate, meaning "caged"): a crystalline structure of water contains the gas molecules deep under the sea, and it's thought there may be a lot of it.

In this week's Spectator "Energy Special" section, Charles Mann spins a candy-floss speculation about its implications "for oil sheiks - and for greens", before admitting that the Japanese exploration may come to nothing, or prove very expensive. For it's one thing to identify an energy source, and another to exploit it in a cost-effective way.

Similarly, Martin Vander Weyer reflects on the dubious prospects for UK shale fracking: maybe 10-15 years of another cheap energy bonanza, maybe nothing.

Of the three articles in that section, Matthew Sinclair's is the most penetrating, because he sees that the more money spent on getting energy, the less there is for the rest of the economy.

Setting aside ecologists' concerns about the climatic effects of the large-scale burning of fossil fuels of any kind - and I think they're legitimate - there is A K Haart's question posed on The Energy Page last month: will we use the opportunity wisely? Otherwise, as he says, quoting Michael Edwardes from 1980, we'd be better off leaving the stuff in the ground.

Britain's Industrial Revolution began in the eighteenth century with coal and water (and the construction of canals and railways); then there was Easy Oil, taking off in the second half of the nineteenth century, and the opening of world markets to the products of Western technology. After that, we came to Harder-to-Get Oil and a globalised economy that has undercut Western labour for thirty years, plus an increasingly detached Western uberclass that blithely imported dividend-sustaining cheap labour and painted its critics as racists. Now we have increasing structural unemployment and pseudo-Green global energy policies that transfer industrial productive capacity to the East, where fossil fuels are ruthlessly exploited to stay ahead of political-economic disaster, like a fox running through the fields with its tail on fire.

It's demand we must manage, not supply. After all the energy efficiencies we can introduce, we shall have to expect less materially per capita - though that is not the same as diminished happiness.

If we run to the agenda of the amoral elite, the solution will be in various appalling forms of population reduction; the alternative is a kind of revolution - peaceful, of course, as those in power have more information and destructive capability than ever.

In the end, all these practical issues will resolve themselves into philosophical, moral and spiritual questions about the Good Life.

All original material is copyright of its author. Fair use permitted. Contact via comment. Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog; or for unintentional error and inaccuracy. The blog author may have, or intend to change, a personal position in any stock or other kind of investment mentioned.

A parade of Polish dragons

See World Voices for the Dragons of Krakow.

Poland: Dragons in Krakow

The day we were due to leave, the sun came out and shone on the thirteenth annual Malopolska Dragons' Parade. Organised by Teatr Groteska, dozens of monsters proceeded from the Wawel fortress down to the packed Rynek Square.

(Photographed by author, 2 June 2013)

This picture combines several local elements. First, there is the traditional dress, indicating the strong ties of language and culture that have  kept the Poles together, despite the fact that since 1795, the country has only been united and independent for a total of 45 years. After the interlude of 1918-1939 came fifty years of totalitarianism in two varieties, so for many of the onlookers the habit of celebration is still fresh. The Central Square has a plaque to commemorate the suicide there of Walenty (Valentine) Badylak, who set himself on fire to protest the suppression of the truth of the Soviet massacre of the Polish elite at Katyn. We were fortunate to have seen the Corpus Christi procession ("never seen so many nuns in one place," said my wife) the Thursday before this parade, and the green-clad Army formed part of the march past - neat and steely serious.

Next is the character seen here riding a dragon. His name is Lajkonik and he has appeared a little early, since he has his own festival a week after Corpus Christi ("konik" is Polish for "horse", though Google translates the whole word as "festivities").  Krakow was attacked by the Mongols in 1241 and it's said that a citizen who had killed a Tatar came back into the city mounted on a horse and clad in his foe's robes. The invaders won, but had to break off their conquest of Poland and return home because the Grand Khan had died, forcing the election of another. They came back twice more before the end of that century, and to this day a warning clarion is blown hourly from the tower of St Mary's Church in the square; the call ends abruptly because the guard was killed mid-note by a Mongol arrow. The current trumpeter is the third generation of his family to perform the ritual, a tradition dating back as least as far as the fourteenth century.

Last is the dragon himself. Legend has it that he dwelt below the Wawel rock on which the castle now stands (commanding a bend in the Vistula). Smok ate girls as his tribute until fooled into swallowing a sulphur-stuffed lamb, which made him so thirsty that he drank from the river until he burst. A forty-year-old, seven-headed sculpture of him stands by the castle, emitting flames every few minutes to the delight of passing children (and now he even belches in response to SMS messages). A huge T-Rex-like carnivorous dinosaur, the remains of which were found 100 miles away near Lublin, has been named Smok Wawelski in his honour.

Whether dragons ever really existed is a question for another article, though my answer to that isn't no. Meanwhile, here are some more images from this year's crop of Smoks:


All original material is copyright of its author. Fair use permitted. Contact via comment. Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog; or for unintentional error and inaccuracy.

Thursday, June 13, 2013

Nick Drew on energy market distortions

See The Energy Page for Nick's piece on why helping little energy companies compete isn't doing them or us any favours.

Bilderberg, Max Keiser, Alex Jones and Nigel Farage

Some comments on Max Keiser's latest piece indicate discomfort with Alex Jones' performance on Andrew Neil's Daily Politics show. My two cents' worth:

Jones' performance has been described as in "meltdown" (e.g. by the normally shrewd Guido) - but that's a serious misreading. This wasn't John Sweeney exploding impotently at the Scientologists.

The British approach is that you can say what you like because it makes no difference, so you may as well be cool about it, too, maybe even ironic, and we expect the usual ending: "Thanks for your input, it'll be interesting to see what happens".

Jones was pushing through that in forthright American style and when he (in effect) accused Neil of supporting the status quo I heard a little bell ring. Neil's "loopy" hand gesture suggested some frustration that he hadn't been able to dominate and kebab his guest as he had with Chris Mounsey of the Libertarian Party.

Some say of cars, "Drive it like you stole it"; this was "Do politics like you mean it." We've had mealy-mouthed twisters up to here (gesture: hand parallel to chin); I think Keiser is right to suggest that we're ready for brash. Keiser himself acts gonzo but is nobody's fool, and when you see what he's criticising you begin to perceive that reality has become so bizarre that the Oxford common room debating style just isn't up to the challenge.

All original material is copyright of its author. Fair use permitted. Contact via comment. Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog; or for unintentional error and inaccuracy. The blog author may have, or intend to change, a personal position in any stock or other kind of investment mentioned.

Womanly care

 Heaven knows what taste the lieutenant could boast of, but even he noticed one characteristic peculiarity about the whole place, which no luxury or style could efface--a complete absence of all trace of womanly, careful hands, which, as we all know, give a warmth, poetry, and snugness to the furnishing of a room. There was a chilliness about it such as one finds in waiting-rooms at stations, in clubs, and foyers at the theatres.
 Anton Chekhov – Mire (1886)

Do we say such things today? Or if we do, is it with a hint of embarrassment or defiance? Or like the fabled file in a prisoner’s cake, is it better to slip them in as Chekhov quotes?

I’m sure nobody is unaware of what Chekhov meant by the chilliness of public spaces. As to why they are chilly - moderns are not so likely to borrow his domestic ideal as an evocative contrast.

Yet our homes are not the private and highly personal spaces they were in Chekhov’s day. Corporate and government interests have seen to that.

All original material is copyright of its author. Fair use permitted. Contact via comment. Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog; or for unintentional error and inaccuracy. The blog author may have, or intend to change, a personal position in any stock or other kind of investment mentioned.

Wednesday, June 12, 2013

Small Electricity Suppliers Have No Right To An Easy Life

Ofgem, whose uselessness over the past decade is a disgrace to the excellent work done by its predecessors Ofgas and Offer in the 1990's, is at it again.
Britain's big six energy companies will face fines unless they open up the electricity market to competition from smaller rivals, under proposals by the regulator designed to "break the stranglehold" of the biggest suppliers.  (DTel)
The details of this are less dramatic than one might imagine: they intend to 'force' the biggest 8 generators (not just the 'Big 6') to become market makers in the forward market out to 2 years.  Since liquidity in the 2-year energy forwards is pretty unsatisfactory - and since that, in turn, is pretty damaging - no one can be happy with the status quo.  Ofgem have been farting around worrying aimlessly about energy liquidity for 8 years now and the only positive development has been the advent of hedge fund and PE money since around 2006 - mostly in the gas sector because electricity trading is fiendishly difficult.  On the downside, banks have been progressively scaling back their commodities trading altogether.

Of course, the real issue is that in the '00s, Ofgem and the competition authorities (against their better judgement but under instruction from Gordon Brown) allowed dumb vertical integration to take hold once more in the electricity market, after the successful efforts of 15 years to break it up.  EDF being allowed to buy BE was the final straw in the structural undermining of liquidity, a point I made at the time. The European authorities, who ought to be a back-stop against this kind of thing, were equally supine.

What I don't understand is why anyone thinks small, under-capitalised electricity suppliers have a God-given right to thrive.  This is the most capital-intensive of industries - whether or not a player intends to back ts energy positions with physical assets (power plants, gas production or storage facilities etc).  Even if they intend to operate on a 'merchant' model - just buying wholesale to meet retail demand - huge quantities of risk capital are required to back the big, long-term deals that are required for that business model.  That is the lesson of 'asset-lite' Enron:  it's a game for big boys with a credit rating of at least A, preferably higher.

What's needed is real competition between ten or so properly-capitalised players. Boutique energy marketing outfits with no credit won't be able to transact 2-year hedges anyway - unless the new 'rules' force the Big 8 to take the credit risk, the merest featherbedding.  Along with the free ride that is currently given to windfarms in terms of not being charged the full cost of their intermittency, plus a heap of social obligations as regards 'poor' retail customers, and even more nonsense contained in the Energy Bill, the burdens being heaped on the big players will one day make some of them decide it's not worth the candle.  Obvious candidates for giving up in disgust are cash-strapped RWE of Germany (nPower) and Spanish Ibderdrola (Scottish Power).  It's not too much of a stretch to see E.ON having second thoughts as well.

See how we like it when Big 6 becomes Big 3, eh?  No amount of flaky, subsidised suppliers called 'Nice Clean Energy' or 'Friendly Power' will help us then.

This post first appeared on the Capitalists@Work blog

All original material is copyright of its author. Fair use permitted. Contact via comment. Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog; or for unintentional error and inaccuracy. The blog author may have, or intend to change, a personal position in any stock or other kind of investment mentioned.

Monday, June 10, 2013

The PRISM Scandal: it gets worse

The ten o' clock news is full of distraction and non-denial denials from the Prime Minister and Foreign Secretary. The PM is vapouring on about the importance of the role of the intelligence services; and the FS is denying that GCHQ is breaking the law without denying that we have all our telecommunications spied on, thus confirming that the law here already permits what the Americans are doing.

I am not surprised, but I am disgusted. Caught with their pants down and without the courage to tell it like it is.

If only libertarians could leave off their trivial consumer obsessions and tackle the subject of the full-scale tyranny in front of us.

Sunday, June 09, 2013


Caveat: I am not an economist, I just like playing with numbers.

Consider an economy with 3 classes of people.

Class C: 50% of the population, earning an average of $50,000 per year, and spending all of it.

Class B: 49% of the population, earning an average of $100,000 per year, spending $95,000, and investing $5,000.

Class A: 1% of the population, earning an average of $1,000,000 per year, spending $300,000, and investing $700,000.

Assuming equal rates of return, class A will receive 74% of any gain in wealth.

Take modest growth of 3.03% per year for 60 years. The total wealth W has now grown to 6W.

Even if they started with nothing, class A now has 3.7W, almost 2/3 of the total wealth.

Friday, June 07, 2013

UK: Green slime

Reading SAS stories, I often come across the nickname "green slime" for the Army Intelligence Corps. I'd hazily thought it was a squaddie comeback at the alien, slightly threatening nature of the people who know more than they'll ever tell you.

It's a bit simpler than that. The Corps beret is a bright green, and so when massed on parade the soldiers will seem to be a moving, verdant carpet.

The kit was devised by its Colonel-in-Chief, the Duke of Edinburgh. The CIC came down to Regimental Headquarters for an inspection shortly after the new outfit had been issued, and asked the Sergeant-Major what he thought of it.

"Bloody horrible, Sir."

"Did you know that I designed the uniform myself?"

"Well then, we've both made a mistake, haven't we, Sir?"

Thursday, June 06, 2013

Smoking: a question

Are we to give up smoking because it "causes fatal diseases", or welcome it because it provides much-needed tax revenue?

As Peter Cook said about his smoking, "I risk my life for my country on a daily basis." And it was liver disease that killed him.

Plain packaging for alcohol, anyone?