9 MAY IS VICTORY DAY

9 May 2023

*Russia's contribution

27 million russians died to save europe from the nazis

Cannot overlook that, all praise Russia on its Victory Day 9 May.

I watched the sad pantomime when the Russian ambassador for Poland was prevented from laying a wreath at a cemetery to commemorate victory in WW2. I assume this demonstration was sanctioned by the Polish gov. They take every opportunity to provoke and humiliate Russia. Until the Ukraine war I didn't appreciate how many European countries.....Poland and all the Baltic states, Finland? .....hate Russia. It's a racial, maybe religious, thing, why hate the Russians? Is it the people, or their elite, who do the hating?

Nothing will change. Poland sees itself as a pre eminent European military power and hankers after some glory period from centuries past.

Likewise the Baltic states.

I guess Finland still thinks of the 1930s war and territory lost. It's not very West European. 

Frankly, for Russia to keep diplomatic ties with these countries is a waste of time. The Ukraine war has given them the excuse to be open on how they see Russia. Would we tolerate such racism in London, for example?

*Cultural genocide

Perhaps only oldies pause and think of the dead, the horrors of the war that occured in Russia. In the west it's ignored and time for a joke. If I read what's happening in the Baltics and Poland correctly, they are removing any trace of the Russians and what they accomplished in WW2. De-russification its called. As above, Russia is a civilised culture and should just cut off diplomatic relations from its more atavistic neighbours. There is no point.

*For the record

"As of 2021, there were nearly 900,000 ethnic Russians in the three countries, having declined from ca 1.7 million in 1989" Wiki.

Latvia is 25% Russian, half the pple living in Riga the capital are Russian. Estonia is a quarter Russian. This was Soviet Russification policy. Why do they now hate Russia? Do they, or is it just the elite?

While elites generally want to expand their power and wealth, generally they thrive on war and stop at nothing Ordinary folk - who stand to lose their loved ones, homes and jobs, prefer peace, freedom and stability.

*MSM

So a lot to evaluate when opening the newspapers or TV. I'm cautious of rhe stuff I read, it is largely propaganda to keep me on board and indoors.

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THE TRUE STORY OF THE WAR IN UKRAINE (PURE EVIL)

7 May 2023

This is the 1992 NATO expansion plan, by Brezinski, naming Ukraine...in 1992.

https://www.comw.org/pda/fulltext/9709brzezinski.html

And here is the true story of NATO enlargement, very clearly told by Jeffrey Sachs  : offset 6'30" - 25'.

https://youtu.be/k_uyfb6OyZ8

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LAMB TAGINE IN CASABLANCA

5 May 2023

Looks absolutely delicious, I want some!!!

Lamb in Asia comes frozen from Australia and is not so tender. The tagine is a slow cook, so should produce melt-in-the-mouth meat full of aromatics.

In Morocco round about 10 in the morning, all the little street cafes would start parking small single-service tagines on beds of glowing carbon embers on the street outside the restau and begin the slow cook to lunch at midday.

So yummy.

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INVESTORS IN EURODOLLAR LAND ARE RUNNING FOR THE HILLS

5 May 2023

Since the GFC, QE tripled America's debt while keeping payments of interest flat.

Now the skies are full of chickens and black swans. America - by debt, inflation, inequality, social & political division, and war ( physical and economic) - is a complete catastrophe - as predicted here since a long time ago. 

Surely they can't be thinking of printing again? Yet cuts to social security and Medicare would send the people back to the White House. 

Already markets are panicking. The coupon for short-term US Treasuries is higher than corporate bonds and three-month T-bill rates are higher than one-month - this is markets saying they want more to hold the dollar through this debt-ceiling crisis. This really disorients calculations using the once "risk-free" rate. As proof, Standard & Poor’s have dropped America’s rating a notch - what if other rating agencies follow?

The entire world economy is built on credit and the starting point is the US Treasuries so-called risk-free rate. This is a bit more than just migrating the software code to new parameters. 

Biden and Trump have said they won't cut. Yellen at the Treasury is down to her last 30 billion and will have to prioritise interest payments over welfare cheques, swelling the Trumpist camps in the barrios. Powell at the Fed pushes forward with hikes, resists "the Fed pivot", continues to defend his mandate on "stable" prices and employment - is inflation really cooling? Pushing the workforce into unemployment to reduce wage and consumption demand doesn't seem to be working - is this because fewer and fewer are active in the labour market?

The RoW (ie eurodollar land) knows all this and is running for the hills!

Have you heard of Ray Dalio's All Weather Portfolio? ... Coming up next ...

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DEBT, GOVERNMENT AND BANKING, 13TH RECESSION HAS STARTED

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STATE OF THE ECONOMY

3 May 2023

https://www.telegraph.co.uk/business/2023/05/02/half-of-americas-banks-are-already-insolvent-credit-crunch/

AEP's articles always entertain like puppy dogs, but seem all over the place to me, it's v hard to find the logical thread, although only an economist could really pick them apart, so I'm left scratching my head - the language tickles but, you're left none the wiser.

If there is a thread to the article, then it's that half of American banks are underwater, effect; Fed over-stimulation of the economy, the cause.

But this is just not true. Those banks are only underwater because of rising interest rates which have lowered the value of safe government bonds *but* at maturity date there is no such problem.

You can't say it's a problem caused by the dollar being the world's reserve currency because QE all started off in Japan and the Euro is similarly affected. 

Obviously lending out the same depositor's dollar multiple times - what is called fractional banking - can only magnify the vulnerabilities, but then what is a capitalist financial system about if it isn't this?

If interest rates were determined by the market, and not by the fed, then where would we be? Well, rates would be high - maybe 12% - ie borrowing would be expen, there'd be little money for investment and consumption spending, and so we'd be living in an economy with little growth and a lot of unemployment.

So the fed artificially stimulates by buying up assets by QE or OMO, which are the same thing more or less, and this reduces the cost of money below the market rate and increases the money supply. 

When all is said and done, this is bound to lead to inflation and devaluation of the currency.

What happens as best I can understand, is that

1. rising interest rates kill off people borrowing money and it starts in the housing sector.

2. So if the housing sector is stamped on, then demand suffers,

3. and if demand suffers and money is expensive then profits shrink,

4. and if companies see that their profits are shrinking they lay people off, and you get rising unemployment and falling stock markets 

...and all of that is the road to what is called a recession.

... but if it's managed properly without excessive government interference, then it's just the business cycle.

https://youtu.be/PzCVj7SOx_I

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HOW TO FINANCE YOUR NEW STARTUP

2 March 2023

1. HOW TO FINANCE YOUR NEW STARTUP

2.CHECKLIST - SHOULD I INVEST IN A STARTUP?

1. HOW TO FINANCE YOUR NEW STARTUP

So you've got this great idea for a new startup but unfortunately you haven't got any customers because they don't know about the product or service you're selling and anyway you don't have a workshop or offices because you can't afford it ... what do you do?

Let's take the example of a company called Resi which is based in Brixton and will rehab your house for a fee and maybe even run the builders.

Resi's founders know there's a huge demand out there, but unfortunately that demand doesn't know about them! And anyway, where can they locate their staff and how can they take on a lease on a building when they have no track record of income or no startup capital enough to convince a landlord they can pay the rent ?

We will talk about two things here in this case that will solve Resi's problem:

-advertising inventory

-convertible loan notes.

Resi can borrow money to build its business - take out a bank loan, or issue bonds (a bond is a loan, but you can sell it on) ; or it can sell shares in its to-be-created new company. The company may exist, and even have some money - "retained earnings" - but not enough to get going.

It wants the money to build a bigger business to sell more!

There's this clever way for a start-up which has no credibility and finds it difficult to borrow money. It's called a Convertible Loan Note or convertible debt. All it is, is just an agreement with an investor to lend the startup money and the debt, or the debt-plus-interest, builds up, and at a later date this debt can be converted into shares in the company, once the revenue starts rolling in and everyone can agree the value of the company.

ITV has said they will lend Resi money, but they want Resi to use some of that money to buy advertising on ITV. That's the deal.

What is it that Resi will buy from ITV? They will buy "advertising inventory". Now what in the world is advertising inventory? It's the amount of space that the publisher - in this case ITV - has to sell. It's all its space, beit on a printed page, or a page on a website, or air time on radio or TV (linear or streaming).

Working out how much advertising costs - how much inventory Resi will need to get its customers and at what cost -  is quite complicated, but you can imagine that the important things to valuing the advertising inventory are how many users view the advert, how many click on the advert, how many fill out a form ... that kind of thing. So you can calculate how much revenue the advertiser, Resi, can expect to generate from the advertising that the publisher, ITV, sells....and so value the inventory.

It pays for the advertising from the loan, but the loan will be on very favourable terms as Resi has promised to buy advertising from ITV with it, or some of it.

So in summary, the company Resi wants to grow fast. It needs capital to start up. It buys advertising inventory from ITV using money that ITV has loaned it, in the form of a convertible loan that at some point, under agreed terms, ITV can convert into shares in the company.

For more info on Resi's idea:

https://resi.co.uk/about

https://www.itvmedia.co.uk/new-to-tv/itvadventures/itv-adventures-invest

They are located in Brixton:

020 8068 4811

https://maps.app.goo.gl/nsLpnqa4g5GhzYmm6

https://m.marketscreener.com/quote/stock/ITV-PLC-4004488/news/ITV-invests-in-architectural-technology-company-Resi-Design-43120156/

27 April 2023

2. CHECKLIST - SHOULD I INVEST IN A STARTUP?

Funding rounds, seed capital

We looked at the products and its competitors

- functions, cf with peers, place in industry, sector

We parsed the marketing and legal comm

- defining terms, taking out emotional appeals, logic, rhetoric

We examined the accoumts and some ratios

- price to sales, prospective earnings, runway, return on capital employed

We cobsidered your portfolio, your investmet strategy and some measures 

- risk/reward, relative weighting, diversification

We did what we could with the time and data available. And made a reasoned decision.

What do you think?

Run through that checklist above and write down your argument on each of the measures...as far as possible.

You wear two hats: you are the fund manager for your portfolio; you are also the customer.

So, write to your customer (who is also you!) a note explaining the action you take.

Pretty soon, you'll have quite a history - a reort each time you buy or sell, with the data on various measures that is driving your decision.

This is how to learn.

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WHO RULES AMERICA?

24 April 2023

America is run by Corporations. Corporations are owned by a handful of extremely wealthy people. America is, then, run by oligarchs.

Socrates tells us that democracy descends into oligarchy because, although we were all equal at the start, over time some people get rich while the majority poor have to borrow to survive. When they can't pay back the rich man takes the land. Unlike food, money is addictive and you can never have enough of it. 

https://youtu.be/CmazxjNHVs4

He says that the oligarchy attempts to establish itself permanently and this is called an aristocracy. The aristocrats enrich themselves at our expense and they take away our land and our liberty and put us into bondage.

There is a revolution against this and democracy returns, involving debt forgiveness and redistribution and the emergence of a benevolent dictatorship (called at the time a "tyrant" ... how language has evolved!) 

and the whole three act play repeats.... from the democracy emerge certain people who manage to get rich and money is addictive so they take all the power and our liberty and our land etc ... "you will have nothing and you will be happy" sorts of people.

If any of this makes sense then the world divides into oligarchies and dictatorships and today we are watching the collapse of the West and according to Socrates, the emergence of new and true democracies.

It's a great story Ray dalio tells a modern version of that and Socrates and Dahlia have not just made this up but they have pulled their Theory from the embers of history, Socrates going back 800 years to the time of the Sumeriums and the Babylonians; and Dalio back 500 years from Dutch to British to American and now his Rise of China.

But never mind all that philobabble, it is made very clear and operational in Michael Kantrowitz's four-light dashboard...three lights red already and now the fourth is blinking ... crikey!

https://youtu.be/IWg-9VKxTw4

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WHY WOKE

24 April 2023

https://www.thetimes.co.uk/article/bar-fights-over-bud-light-the-beer-thats-split-america-ntv53cm9k?shareToken=3a0af61f599669ef9b1edde389c9ab8a

Interesting article with a few surprising facts. Many people of an older generation would not be able to relate to this product marketing, not really understand a word of this and would have the greatest difficulty reading the article through to the end.

Especially interesting to learn why some companies persist with what many find is a real product turn-off: a Woke marketing campaign.

But reality is, Bud Light is not on a weird woke moral crusade, no, what it's trying to do is all in the interests of rejuvenating the image of Bud Light and focusing on this will, it believes, increase future sales long-term.

So they are not discouraged by a short-term negative storm from established more conservative customers, they just wait patiently for the oldies to die out.

Perhaps they could support transgenders' presentations in primary school classrooms.

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THE STATE OF WEALTH, EMPIRE AND PLANET IN 2023

20 April 2023

Today, we consider three related questions:

 - how to save our wealth?

 - how to save our Order?

 - how to save our planet?

Our belief in liberal democracy remains strong but our elite has corrupted its values. 

1. HOW TO MANAGE OUR SAVINGS?

Means how to save the economy, financial markets and the dollar.

Macroeconomic signals of a recession abound. On a four-light dashboard - housing, supplier orders, company profits and employment - the first three lights are red and the fourth is blinking. With average time delays, we are looking - according to this  macro view - at a recession this year; and on closer examination of the data, it won't be "a soft landing"...can't be, won't be.

We are saying that the economy and financial markets are done for. 

Stock market equity - where we store our savings - is where the consequences will be felt first.

What to do? Is it world equity or will some regions or countries fare better than others?

What about the business cycle? If the economy is shutting down, which sectors tumble first?

We will return to answers in a future article ... God willing ...

2. HOW TO MANAGE AMERICA'S EMPIRE?

On which we in The West depend, let's not forget.

All these troubles and threats emanate from America's hopeless mismanagement of its turn in the pecking Order.

But is the economic collapse of economies, markets and currencies the worst that can happen to us?

3. HOW TO SAVE OUR PLANET?

Noooo - we could blow our planet apart or completely deregulate the climate.

4. ARE THERE ANY REASONS TO BE CHEERFUL?

Time and again the cause seems to go back to the corruption of our values. Our belief in liberal democracy remains strong, but we have lost the benign tolerance. Our leadership is not connected to the interests of the people.

I want to understand how the elite became so adrift, how it has become so disrespectful of the people ... it is hubris, but that is just to describe...how did it happen? Is it something to do with the strength of its control, made possible by te hnology, that has allowed our leaders to become complacent about their power.

And what to do to put things back together again? Can the system be reformed? Or must it be overturned? This was Edmond Burke's question. Reform or revolution - France again points one way. How to break the control of the corporations and restore central authority on behalf of the people ... of the planet even?

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FROM COST-PLUS TO LIST-MINUS

16 April 2023

Victrex is an interesting company. It's a world leader in specialist polymers.

They say: "Victrex is an innovative world leader in high-performance polymer solutions and the number 1  polyetheretherketone (PEEK) experts. Millions of people rely on our sustainable polymers, in  smartphones, aeroplanes and cars to oil & gas operations and medical devices."

Polymers, even specialist, is just a commodity market - they sell pellets by the tonne, it's cost-plus pricing. 

Their idea is to go up the value chain, into list-price-minus, building their moat by doing high-end moulding themselves, researching and making "forms and parts". 

They are opening a new factory in Leeds and upgrading facilities in China. They aim to grow revenues from  forms and parts from 20 to 60% of tot rev by 2033. 

They've got seven mega programmes. Aerospoace structures is one and interesting as polymers are even lighter than aluminium.

In the Medical sub-division, perhaps the best example is in the $1 billion replacement knee market (this is what prompted me to investigate and to write this!!!). Early trials are going well. 

Not being cynical, but obviously war zones, esp wars of attrition, which seem to be the only way to avoid nuclear, would generate a lot of business from public health services in developed economies.

Victrex is going to help the many veterans.  Do you feel this is profiting - supporting even - from these foolish neocon wars? Or is being involved part of the philosophy that says the world does not fold to our needs, but it is for us to adapt to the world and meet the needs of the world as we find it. Take the world as is and not as we'd like it to be ... the Realist position.

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