patrick.net

Conor,

Good point about inflation in CA. Higher inflation will just accelerate the trends we already see. The best public school districts will become quasi privatized (huge donations demanded from parents) and the rest of the school districts will be absolutely worthless.

OT. Anyone seen this?

http://www.nytimes.com/2006/05/07/realestate/07california.html?pagewanted=all

Pop: I still keep my portfolio diversified even though things may or may not turn out as ugly as some of my posts might suggest.

and I'm actually a lot more bearish than my posts have made it seem. I've been long in cash ever since August 2000 and it's crucified me. It was the classic "right play" to make before a recession but the recession never really came. It's been crawling at 5% after a house running at 15%. I sure hope Aesop was right...

Dystopian Contrarian echoes many of the things I've learned from Randy H. Has anyone ever seen both of them in the same place at the same time?

Dystopian Contrarian,

Good writing. I enjoyed it.

But I thought the real Depression only came into existence AFTER FDR took power!!

I don't think occupation of France was part of A.H.'s design. It was meant to drive England out of the continent, for the English always liked to meddle in continental affairs and forestall any promising aspirant. A.H.'s real object of expansion is towards the east, if you care to read the historical texts (including that guy's own rumination from a prison).

The US forced Japan into the Pacific War for a number of reasons. Mind you, the US did NOTHING regarding Japan's "incursion" into China proper, prior to the outbreak of WWII in Europe.

China was a hegemony of some sort in Asia, for a long time.

Only after WWII did the act of "intiating a war of aggression" become criminal, provided of course the aggressor lost.

There is no MORALITY in international relations. It's all about power interests.

SFWoman,

Foreign stocks can be extremely volatile. Countries like India and Pakistan do not have the regulatory standards of US. It's hard to trust and evaluate companies from such countries. Recently, for many reasons, the Asian stock markets have been going strong. Increased political stability, benefits of globalization, increased exports, stronger currencies etc. Foreign funds have been pouring into newly opened markets for foreign investors. Take a look at the chart of Bombay stock index BSE on yahoo.

http://tinyurl.com/m9wte

Note that the index - the average - is up 300% over last 2 years. Individual stocks have done way better. It is crazy.

It can end very quickly. Or it may stabilize. Who knows ? IMO, there is only one way to play these markets. Don't time them. Do $ cost averaging, take a long term view and diversify. Use ETF and/or mutual funds after making sure you understand what their strategy is. Some of the ETF's are too concentrated or have very high expense ratios. Some mutual funds have been very recently formed to cash in on the craze. Go with long term track record. Make sure you feel good about that particular countries future.

Same applies to countries from Eastern Europe.

The good thing is, there are lots of options available. You can invest in world stock mutual funds, or Pacific ex-Japan, or just single country ETF like Korea index for example.

US is still the best stock market, and I think it should still have overweight status in a portfolio.

THIS IS JUST MY PERSONAL OPINION. MAY NOT BE SUITABLE FOR YOUR PERSONAL SITUATION. I OWN MANY FOERIGN MUTUAL FUNDS and ETFs. CAVEAT EMPTOR etc.

BTW, A.H. held great admiration for GB and US. I believe a very dark motive for involving US and for England's continued fighting in WWII was to crush a new aspirant.

I don't sympathesize with anyone. It's all about who won and who lost and who loses and how that happened and how we can learn from that.

BTW, Germany between 1870-WWII was looked on upon by many Chinese leaders at the time as the model for China. In their eyes, Germany succeeded in uniting themselves and became both economically and politically strong, after having had the honor to serve as the battleground for European powers for several centuries.

Hell, I am still trying to figure out why anyone would pay that kind of money for a Mainland Chinese bank. I kind of understand the Chinese doing it, because they do not have many better saving avenues, but why would any foreigner possibly touch that hot potato? Where the hell is the upside?

GC,

Bismarck and Hitler are not quite equivalent to each other. While the Germans (and the French, and just about everyone else) don't like the meddlesome English, Bismarck managed to co-exist with Austria Hungary and did not nurse Napoleonic ambitions.

You are treading awfully close to being provacative for the sake of provoking. If someone here ends up being annoyed by your comments, be forewarned that I will erase.

Randy H,

You said: But I have a command on what my “discount rate” is.

I believe you were explaining that you can make your own informed decision in holding a commodities porfolio inlcuding precious metals.

As usual, I have to ask you to dumb it down a bit for me. I'm guessing your discount rate has something to do with the present value of those commodities at some future date if speculative pressures don't change the price. Am I getting warmer? Is your personal discount rate based on the returns you could make in other income generating investments that are available to you?

Dystopian,

I'm not sure FDR truly cured the Great Depression. His programs ameliorated the conditions and some portions of society managed to recover by the late 1930s, but there's no proof that his policy actually pulled the US out of depression.

Of course, he was much more fiscally conservative than Republicans today give him credit for. He didn't spend on borrowed credit. New Deal also built useful stuff, as oppose to those Japanese roads to nowhere.

D.C.,

I read that one long ago, yes, in English, and found it repetitious and boring. I''ll do an online search to validate your claim.

I thought Japan escalated its compaign in the Pacific shortly after they attacked Pearl Harbour. Yes, they were forced into a conflict with US. But once the shooting started, they had no choice but to occupy strategic locations in the Pacific. It's so natural: If you have to fight, fight with all you have and fight to win. Why is it so difficult to understand?

Given the economic strength and freedom, EVERY NATION wants a mighty navy.

That is why I AM VERY CONCERNED ABOUT THE RISE OF CHINA AND INDIA. This rise will cause instability in the world and potentially another GREAT WAR.

Before, it was the rise of German and later re-surrection of Germany and the rise of Japan. Now ......

DID YOU GET MY MESSAGE?

There is no morality in international affairs. It is all about power.

Garth,

You've got one part of it. Discount rates apply both to time and to risk. I think Randy was primarily talking about risk. Usually, there's a discount for higher risk investments. That means the expected return for riskier investments should be higher than the expected return for less risky investments.

Dystopian Contrarian echoes many of the things I’ve learned from Randy H. Has anyone ever seen both of them in the same place at the same time?

Randall Harrison Esq. is no longer available, please forward any inquiries to his admin, Miss Sassy Pants.

surfer-x,

I think that's Randolph...

astrid,

it is the same reason why one would pay 200 P/E or 1000 P/E for dotcoms. At the height of the Red Chip craze in 1997, people were paying >200 P/E for mainland Chinese textile outfits, shipyards, real estate developers, or conglomerates (which means nobody knows what the heck they do). I was asking my friend why they were buying these stocks, they were giving me this stare like I didn't comprehend the basics of economics. Needless to say, these stocks tanked 90-95% after the pop, some even got delisted.

I really don't think the Chinese and the Indians are in a position to do large scale warfare. They've got way too many internal problems to take care of. They're also nowhere as well organized as the Japanese and Germans of the 1930s. They're much more likely to implode than direct their attentions outwards.

20th century warfare is a negative game, nobody wins. Just look at Israel.

People who are so negative on the future need to take a hike around the world and see what kind of condition most people are facing. Being born in this country is already giving you a HUGE head start against people from some countries who will never reach even 1/10 of your living standard no matter how hard they try. They are doomed from the moment of birth.

Americans are spoilt. Nobody needs to eat that much food, eating less that the appetite allows is healthy, nobody needs to drive so much, walking is even better. Nobody needs to live in a house with 1000sf per capita, most people in the world get by with only 1/10 of that, and they are just fine. Nobody needs to buy so much Walmart junk that cycles from the store to the garage and then to the rubbish bin in a matter of days.

I say most Americans are pretty obsessed with self-inflicting pain. If they just scale back some of their unreasonable, larger-than-life expectations, they will be a lot happier and healthier.

SFWoman,

the solution is easy, encourage gay sex. Also, China has a huge prostitution industry, it is a huge part of the GDP that goes unreported. As long as the single guys can get their aggression relieved in other channels, they will be fine.

SFWoman,

The Chinese have a long tradition of female infanticide or simply letting girls die in times of hardship through neglect. This situation had manifested itself in internal instability. Via higher crime rates and greater likelihood of revolutionary behavior.

I suppose the Chinese can try to coopt these futureless young men via military expeditions abroad. But that would be a risky move. Veterans are not a particularly pacific bunch, and China has enough problems without engaging in war abroad. They could not even defeat the Vietnamese!

Owneroccupier,

I think my 7th grade lab partner expressed the sentiment the best. "Americans are born to waste, thats what makes me American."

Owneroccupier,

The Chinese managed to deal with a female shortage since forever - concubinage + relatively few warriers. I guess prostitution is pretty much inevitable. The important thing is to keep these men hoping to marry, then pull the rug from under them when they are 40 or 50 and too old to make trouble.

I have a distant relative in rural Heilongjiang. The family had 5 sons and one daughter. None of the sons married.

D.C.,

Your correction well taken. AH did express admiration for US industrial potential, now I remember, not for the innate propensity to fight that the tommies were so well-known for. But his Bundestag speech was probably aimed at rallying his troops by belittling the Americans. You said the Bundestag was a sham at that time. So it was probably towards the end of the war when American jackboots were already on the European continent. Just my guess.

A starving man only wants a job to feed himself. But when hunger is no longer an issue, he casts his glances at your house, garden, and perhaps your gold coins, too.

That's why the Spartans kept their men in perpetual war-like training and living environment, so as not to lose guard and become soft. Sparta survived a long time.

SFWoman,

Sorry for erasing your target. I have an especial dislike for trolls who keep changing their handles. ;)

GC,

Yes, the lovely Laconians. But when they went out, they did it in an awfully bloody minded way. Besides, the Athenians might have made it if there was no plague. And at least we still remember Athenian contribution to human knowledge. We know basically nothing about the Spartans, except that they oppressed a lot of Helots.

Also, before certain country becomes strong as she is today, would she have had the guts and clout to meddle in the Iran and North Korea nuke affairs, purposely upsetting the US plan to forestall potential nuclear threats?

SFWoman,

Sadly, I think the latter is the case. It managed to reference a personal detail about me this afternoon.

Standing up to America is really not that hard. Just ask Kim Jong Il. The American military is stretched very thin right now, and it's not getting much respect on the diplomatic front.

It's an SBC account routed out of Plano, Texas. However, that doesn't mean the person posting is from the Plano area.

SFWoman,

There's some debate about exactly how crazy Kim Jong Il is. He may simply be crazy like a fox. That guy is a survivor. Most people thought he wouldn't last two years after his father died, but he's managed so survive for over ten years, bad haircut, crooked teeth, and all.

Let us not be naive. If Kim Jong II didn't have "under the table" promises from God-know-who, his regime wouldn't have lasted. He was useful to some countries. I've seen this again and again in personal and social matters as well. It's always the same pattern: Some crazies are used to muddle the water while those pulling the strings in the back reap certain kinds of profit (not necessarily in monetary terms).

Of course, the US has done the same to those countries, for example, by supporting certain religious leaders or political dissidents. It's power play, as I said over and over again. The key is where you stand. For me, self interest rules supreme.

SFWoman,

Zillow is pretty worthless for internal details. It is a nice way to check out a neighborhood and check the sales records. The California Google Earth add ons are very nice. However, I wouldn't trust it's valuation except as a very broad ballpark.

He is pretty pathetic. At least the last spambot/stupid troll posted legit mls sales.

GC,

I agree this was the case in the past. China wanted a buffer from South Korea and the American presence there. But I don't think it's in China's interest to antagonize the Japanese and ROK with Kim's antics. Also, notice that Kim tries his best to go against the wishes of, uh, his Chinese masters.

A ruling elite will look out for its self interest. But its self interest can be benevalent as well as belligerant. Modern Singapore and Japan managed to run very successful states without directly oppressing anyone, except their Malaysian maids.

Cool! Too bad I don't know any $15 million house owners.

I have to say, if I had a $15 million house, I would cash out, hire a private plane, and start looking my own South Seas fiefdom. SF is very nice, but the sea water is kind of cold.

Fair enough. But then again, some people are masters of acting. Let me quote a cliche -- how does one do e with that thing, I mean that thing, you know, that thing, that little thing on e, no, no, the other way, yeah, ', that is it, what do you call it? -- "nothing is what it seems." We can go on and on.

GC,

Perhaps Kim is a Manchurian candidate, so to speak. However, that is speculative and not well backed by facts. Most Korean watchers think he's got a mind of his own, and quite a wily mind too.

I'm not educated enough to converse about the "that thing."

SFWoman,

then you will lose the low humidity weather of Norcal, and turn us into FL. Cold currents meeting warm land is exactly what makes the mediterranean weather so desirable, warm, humid weather is a dime a dozen.

There are only 4 spots in the world where you get mild weather with low humidity, the first one is of course Mediterranean Italian coast/ French Cote d'Azur, the second spot is us, third down along the Chilean coast and the last around Perth, Australia. We certainly don't want to lose this treasured seat, do we? :-)

"Imagine the beaches of Marin or Sonoma with 84 degree water. Ahh."

That sounds excellent! Though I fear such a gift would up the BA intangibles up even further and double the rent for me!

(I heard it's the cold ocean waters that give BA such mild year around weather. Warmer ocean waters would change the weather to be more like the East Coast.)

Owneroccupier,

What about South Africa? I thought it also has a Mediterrean climate.

South Africa unfortunatel (or fortunately?) has warm waters.