​This is not the time of the year when Europe is at its best weather-wise.
Today the evening is cold, rainy and the wind is picking up.
The political events out there have developed a new dynamic too – it’s not just the Italian budget debacle anymore. After president Macron made financial concessions to the yellow-jacketed protesters, the French budget deficit is projected to look no better than the Italian one.
Even in Germany, chancellor Merkel had to blink and allow for the shotgun wedding of Commerzbank and the troubled Deutsche Bank. Let’s stop on the latter for a moment, because it’s an interesting story on its own.
Deutsche Bank is in crisis and everyone has known that – its stock lost more than half its value in 2018 alone. This biggest European bank is in the news a lot and never in a good way - the list of criminal charges against it reads like a crime novel and the bank spends a fortune in fines and settlement.
Its derivative exposure is huge, and it is hard to quantify what is the real net bottom line, but it could well be more than 10 times the Gross Domestic Product of all Germany. 
It doesn’t help the situation that the bank’s leadership is a revolving a door - it went through four CEO’s in as many years to the point that is not clear who is actually running that place.
While all this is not unusual among world biggest banks (just look at HSBC, Wells Fargo, or, for a real eye opener, at Goldman Sachs), DB seems to suffer the most. It could be that their derivatives exposure is the source of this downfall, but for a different reason than most think.
These derivatives are delicate credit instruments held in tens of trillions of dollars by major banks around the world, but it’s never clear who is on the other side of the trade. There must be a big player backing it up and it must be default free, at least for a moment. And there is only one player that fits that definition – the US Treasury, more specifically it’s Exchange Stabilization Fund.
So, how this is causing Deutsche Bank trouble? It appears that through its derivative exposure Deutsche Bank helped manipulate interest rates and propped the US dollar. 
Throw in the mix the rising tensions between Germany and the US, and the bank’s situation looks terrible politically.
Enter BaFin, the German fiercely independent financial supervisory authority that appears to be calling the shots at Deutsche Bank for a while now. Specifically, it is forcing them to liquidate exposure to dollar credit swaps.
In May of this year the bank stunned the markets by suffering a staggering one-day loss that was almost 12 x VaR (value at risk), or 12 times what DB's risk officers have estimated it might lose on a typical day. And these guys are not incompetent. The only explanation is that they were forced by BaFin to close some positions in the marketplace.
The US Fed isn’t, of course, taking it on the chin with his hands down, they’re punching back like mad, prosecuting DB, damaging them publicly and forcing the bank out of lucrative markets like precious metal trading.
In a related example of the US and Germany exchanging punches, the VW concern recently built an engine plant in Russia, in Kaluga. Clearly against US interest, who want to put Russia in an economic penalty box.
The plant opened on Sept. 4th, 2015, after it took three years to finish.
On September 18th, 2015 the US Environmental Protection Agency served a Notice of Violation (NOV) to Volkswagen for emission problems and the rest is history.
 
And all this could be a coincidence, of course. Or my mind wandering on a cold December night.
 
In the movie “The Counselor” Brad Pitt says this about some serious people he deals with south of the border: “you know, they heard about coincidences, they just never saw one.”
Could be a good advice.
 

​The title comes from a song by Gary Moore that was a hit in 1979, but was really based on the jazz standard “Blue Bossa” by Kenny Dorham, an American jazz trumpeter who never received the attention or fame he deserved.
This happens a lot in life but it’s hard to know in the real time what's important, to be fair.
The austerity measures of the EU are having a profound impact in Europe. The proof is in the news - in Paris on December 1st there was a major civil uprising, the worst France has seen in decades. Jeanne d’Hauteserre, the mayor of Paris’ 8th district, near the Arc de Triomphe told the press: “We are in a state of insurrection, I’ve never seen anything like it.” We can easily be witnessing the start of the next French Revolution and there is no solution in sight.
Still, president Macron is unrepentant and unyielding. He said he would not change his policy because of the protests of “thugs”.
By making this statement he follows the French history of misunderstanding major events, which is no different from what Marie Antoinette did.
She said back in the days of Revolution “Let them eat cake”.
It’s is not clear what she really meant – eat cake instead of bread, or crumbles from the crust of the pâté, but her words inspired a revolution nevertheless.
It is simply a wrong thing to tell people in the heat of the battle.
Revolutions always and everywhere start because of excessive oppression or excessive taxation, but those in power do their best not to understand it. To be fair, it’s very difficult to make a person understand something if her/his salary depends on them not understanding it.
And revolutions take time to clean up after - Vienna conference was called to clean up the mess in Europe after Napoleon, who was a product of the French Revolution. Another upheaval of this kind happened in Russia and it took almost a century to contain.
A brutal world war too.
Still, I have this respect for Napoleon Bonaparte, and I can’t finish without saying something about him.
He was a guy’s guy. During his wars he was right there in trenches with his soldiers, dirty with mud and smelling of gunpowder. You don’t get this type of behavior from Pentagon officials these days and it makes a huge difference.
He married Josephine de Beauharnais known as Rose, a name that he disliked. He called her "Joséphine" instead. I like that too. He divorced her eventually, so he could remarry in search of an heir. But he showed his dedication to her for the rest of his life. After they split, Napoleon was never the same - he developed health problems, gained weight. During the battle of Waterloo stomach pains paralyzed him. And then he lost everything, tough for a guy who never knew when to quit, when to stop, or when to say die.
Living his last days on the far island must have been a torture and I think he just wanted to be back with her. I think she did too because he was a unique man and they made a unique couple.
All his life standing on the ledge showing the wind how to fly. Both of them.
 
This is the thing about the revolutionaries – you can’t help but have a respect.

I was in Berlin again, riding in a taxi from the Brandenburg Gate west through the Tiergarten when I heard a song on the radio. It reminded me of the days when I was a teenager living in these parts. 
The song starts:  
“Don't think sorry is easily said.”
And it gets deeper after that, but wait a bit.
 
The area we drove through is likely the nicest part of Berlin, starting from the Gate, then the enormous building of Bundestag, which flies too many EU flags to be taken seriously, and going west to the golden Victory Column.  The Column was erected to commemorate the victory in the Danish-Prussian war. To be fair, the Germans don’t have many wins to celebrate, so this one is as good as it gets. It features the Golden Lizzy on top, a statue weighing 35 tonnes, and I actually like the view of it.
 
Moving back in time a little, to earlier in the afternoon, I got into the taxi on the corner by the hotel, right by the Ku’damm. The hotel is called Berlin Bristol now, used to be Kempinsky, but they dropped the Polish name. Fine.
“Tegel flughafen bitte,” I said to the older driver in my best German, but there was no fooling him. He looked in the mirror assessing me for a second and said “mach’ ich sofort boss”. 
“You take visa?” 
“All taxis in Germany do,” he replied in fluent English. 
Guess it’s one way to find out. 
 
The radio in the cream colored Mercedes was spewing news about Russia blocking the strait to the Black Sea, which caused the Ukraine stand off. The narrative was simplistic, just proving that the media doesn’t have a sense of harmony or a sense of time.
We listened to it for a while before the driver turned it off. 
He actually did.
“It could be,” he said casually, “that Russia and Ukraine are in cahoots. Poroshenko’s approval rating is in the single digits right before the election. And now he has introduced martial law so he can postpone election for as long as he wants, could be years. And this is actually good for everybody. The Kremlin will keep their ally in Ukraine instead of some wild extremists. Poroshenko’s company’s chocolate products sell well in Moscow, so why kill a good business? Everybody goes home happy and the rest is just talking.”
“It’s playing chess, and the Russians beat everyone at it,” I said relaxing on the back seat, “but this kind of thinking gets no traction in the media.”
 
He drove in silence for a while as we were passing the depressingly neglected apartment houses of the old East Berlin. They sure look better with the leaves on the trees but it was too late now. It appeared that he thought about the same thing.
“I like Africa,” he said, “the weather here kills me. Besides, Africa is where humankind started. Have you ever been there?”
“In Morocco briefly, and my wife is down there right now, in Johannesburg.”
 “Moving a little north,” he said, “some believe that the Sphinx predates the Egyptians and was actually a lion. Did you know that?  There appears to be water erosion marks on it,” he said.  “Which means that the Sahara was once a tropical place with trees and animals. If that’s true, then the original Sphinx may have existed even as far back as 10,000BC when a Lion would have faced the constellation, Leo.” 
He looked at me in the mirror.
“Because, you know, it doesn’t anymore.”
 
“I do know, and I know a Leo, and he’s a brilliant young man.”
 
“You liked the song that played before,” he said looking at me in the mirror again. “It seemed to make an impression on you.”
“Not really,” I said, “because it is about falling out of love.”
“And this bothers you?”
“Yes, it does, life is not what it used to be but I do my best to adapt.”
He looked at me long enough that someone honked at us repeatedly in the traffic, until I said: “I’m doing my best, and that’s all I want to say.”
 
When we arrived at Tegel, the square payment terminal in the car couldn’t connect to the network. 
“It’s because of all the interferences at the airport,” he said. 
“I sure hope it doesn’t affect the planes.”
He laughed silently and we settled in cash.

​

​Deep in the Swiss Alps, close to the town of Amsteg, is an old army airstrip suitable for landing long-range jets. It is owned by a company that offers gold-storage services in the army tunnels, which are dug into the rocks. The tunnels were put up for sale after the Cold War ended and a few private companies turned them into vaults: a place for rich people to hide money. The nearby landing strip can take Gulfstream and Falcon jets from all over the world, and the service here is all cash. The Swiss gold-storage operations are independent from the banking system and don’t have the same obligation to report transactions to federal authorities. That makes them extremely attractive to the wealthy. But few of the locations match the opulence of this airstrip setup. Near the runway is a VIP lounge and a pair of luxurious apartments for clients. The lounge offers a place to sleep and eat if the clients don’t want to leave a paper trail of credit cards and passports at a hotel in town. The entrance to the office, which is protected by a guard in a bulletproof vest, is a small metal door set into a granite mountain face at the end of a narrow country lane. Behind two farther doors is a 3.5-ton metal portal and a maze of tunnels once used by the army.
Swiss gold storage operations in the Alps, like the one close to Amsteg, are prime locations for capital that wants to get off the grid. The other one is Singapore.
Most of the gold produced in the world transits physically through Switzerland. On an average year, the country refines about 70 per cent of the world’s gold, and with all the yellow metal coming and going, it’s close to impossible to say how much of it disappears during the process in these fine storage facilities in the Alps. The privacy is aided by the fact that trading in the Swiss gold market is exclusively over-the-counter, and there are no central exchanges or trading venues.
And so capital moves constantly around the world and it is driven by human nature either running into something (boom) or fleeing it (bust). No market would move without capital flows domestically or internationally.
The Swiss wisely kept their currency when the EU came about and are not exposed to the euro debacle, which is an interesting example of capital moves. The euro hit the all-time high shortly after its launch at the start of 1999, which marked the euphoria how it would crush the dollar. It began to slide shortly thereafter, falling to a record low of 82.3 US cents in October 2000. This is when the capital inflows to the USA began over fears of the euro. The capital fled Europe, and this was one of the reasons why the dot com bubble was so big.
Interestingly, history seems to repeat itself. The Eurozone is currently the number one place in the world with the greatest amount of capital fleeing than any other region worldwide. Externally, there is still a flight to the dollar-based assets globally.
The question is, why this is happening. To start with, the euro is a flawed creation with limited shelf life. And obviously capital knows that.
There is an important difference between how the EU and the US function. In the US, government bonds are the only financial instruments that bank can use as reserves (to borrow against and issue loans). The paper issued by member states doesn’t qualify. As result, Washington doesn’t really care about their finances.
In a striking contrast, there is no unified debt in Europe and so the EU in Brussels will stick its nose into budget of every country, like Italy lately. All EU members can print their own euros all right, they do not get them from the European Central Bank. It’s a local affair, limited to the credit worthiness of the particular country – and this is a crucial point to understand how the EU is different. Within Europe the capital is clearly flowing into Germany, and ultra-low yields on Bunds are the proof of that. Part of it is capital preservation – the big money knows that they will end up with deutsche marks, should the euro fold.
Maybe this is a good time to go back to gold - it is considered insurance with no credit risk attached. There is not another like it in the world. And it feels good when you hold it in your hand. You can print money as much as you like, but you can’t print gold.

The headquarter of the winery​ is located in the city of Épernay, Champagne country, in northern France. It's a substantial, historical complex along the Avenue de Champagne, called “the most expensive street in the world” as it houses about 200M bottles of expensive bubbly on three cellar levels underneath its surface. The main building prominently displays the statue of Dom Pérignon - a Benedictine monk who pioneered many techniques of wine making. The art of making it is very manual to this day, and, after almost 300 years of tradition, impossible to re-create anywhere else.
A guided tour of the cellars with champagne tasting at the end, and later a visit to the store, is a great way to spend Saturday afternoon. In this environment dropping a small fortune on a bottle of Dom’s finest seems like the right thing to do.
Not far from Épernay, on the same afternoon, under grey clouds and persistent drizzle, president Macron and Chancellor Merkel laid a wreath at a solemn ceremony at Compiègne as they marked the centenary of the armistice signing, which ended the Great War. In a bizarre turn of events president Macron chose this anniversary for advocating the idea of European army, claiming that NATO, for which he refuses to pay his fair share, doesn’t provide enough protection. The idea of pan-European army makes a lot of sense for Germany, and also for the EU, as it provides Brussels with more than just warnings and penalties in disciplining its members. The legal provisions for it already exist in the Lisbon Treaty, so there is more to this initiative that the young Emmanuel is willing to reveal.
It is impossible to understand European politics without realizing that the order on the continent is re-negotiated with some frequency. And as much as the Treaty of Versailles at the end of the First World War was a disastrous settlement that laid foundation for the 2nd, more bloody, war in a short time, the one before it was really good. The order negotiated at the Congress of Vienna in 1815 lasted 100 years and provided Europe with the longest period of prosperity and growth. The Congress was called by all the kings of Europe to establish long term piece plan after the Napoleonic wars, which were a product of French Revolution. What ended the arrangement, were the nationalists and liberal movements tearing Europe apart in late 19th century.
The order negotiated at the Yalta Conference at the beginning of 1945, had also more staying power than the Treaty of Versailles. It lasted 40 years until mid-1980’s, when the European countries in Russian’s sphere of influence were becoming unstable.
 It was then, when the Russians suggested something extraordinary.
During a 1985 meeting in Geneva, Mikhail Gorbachev offered Ronald Reagan a proposition of a new order in Europe, which was accepted by the Americans. The proof of it were annual meetings held from 1986 to 1989, while the new deal was taking shape.
What happened next has no precedence in European history – the Russians agreed for the re-unification of Germany and removal of their army bases from Eastern European satellite countries in exchange for the guarantee that NATO will not be extended to the East. A silly promise, not taken seriously by any side of the negotiations, I am pretty sure.
So, there was likely more to it, like it is to Emmanuel Macron latest idea.
It appears that the Russians just changed their form of presence in Eastern Europe after 1989, from vertical to horizontal, so to speak. Instead of army bases they exerted their influence in the economical (and by extension political) life of the former satellite countries. It was a brilliant move by master chess players. One could say that their absence there is a higher form of presence.
Going back in time and checking into Château de Saulon in Burgundy last Friday night, the concierge asked me about plans for the weekend.
“I have a business to do with Dom Pérignon,” I said, “and it will be mutually beneficial.”

​Here is my definition of a plan A entertainment to start with: George Carlin and Robin Williams, Kurt Vonnegut and John Belushi, Rodney Dangerfield. A pattern here is that they’re not around anymore. Even Charlie Sheen is nowhere to be found these days! 
Instead, in this mid-term election week in the US, I found this piece of news that goes into the “Oh Christ, please not that!” category:
“Georgia election worker Mitchell Hamlin reportedly assured a black man on Tuesday that the ballot scanner was supposed to sound like a shredder.”
That’s plan B for me, but funny still.
At a rally in Indiana just before the vote, president Trump was reminded by reporters, that if Democrats take control of the House (which they did), legislators will be empowered to do things like pursue his personal tax returns. “I don’t care,” he responded, “They can do whatever they want, and I can do whatever I want.” He actually has a point, as the majority of the real power lies in the Senate, not in the House.
Given the results of the mid-term election, the one thing that is guaranteed is that there will be zero cooperation, and everything will become even more obstructive now. The races are so razer-thin showing clearly that the nation is deeply divided
Comparing political development to markets activity, the Trump phenomenon is a counter-trend, a false move. It will by no means change the trend of endless government borrowing fueled by reckless money creation by the Federal Reserve. The “best economy ever” Donald just makes it faster, more colorful too. For me he is the Ron White of politics.
Tax cuts, entitlements and Pentagon’s spend-a-ton will force the government to borrow like never before. The Treasury Department estimates that it will issue some $1.338 trillion in debt this year—more than twice the amount as last year. Did you know that the government could soon pay more in interest than on defense? And this in the environment of rising interest rates.
 
From plan B entertainment to plan B career path - I read this fascinating interview with a veteran actor about life choices. He was right in saying that if you get rejected for a job there are usually factors that are not personal. The company may be pursuing different strategy; internal candidates are given the priority and so on. But if you get rejected after an actor audition it’s all about you. That’s much harder to take.
So, he said, that if you have a plan B in life, definitely pursue the plan B. Chances are it will work out better. But there is actually more to it. Your plan A and the way you make a living is typically determined by what’s expected of you and by your needs to survive.  And so you go with it year after year as most of us do. But you do have a plan B deep in your mind, something you really hope to do one day before your time is out. Chances are it will work out better, because that’s where your heart is. Can’t fool it.
 
So I looked up walking in town the other day – it was still cloudy with bits of November sun and I thought about my red and black motorcycle parked underneath my apartment. Every morning going to work I am facing the dilemma on getting on the Bimmer instead and driving far south. Then hole up in a nice hotel with a sea view and write another book. Which simply means that it will happen one day.
On a more upbeat note, my current horoscope says this: “It’s not the hammer of life that’s going to beat you down this week, but the hammer of Gene Dubrowski, a local roofer.”
Now I have a really good reason to look up.

It was a cold and rainy October evening when I was sitting inside the “Zur Sonne” in Marburg, Hessen, Germany. It is quite possibly the oldest restaurant in town, with operations dating back to 1569.
By chance, being here the last week of October meant being witness to some big events in German politics. And you know they’re big, because people here don’t want to talk about them.
“Who is it you say?? I don’t really know. Is the speatzli good or you need more sauce?”
“More wine, maybe.”
Both ruling parties, the SPD and the CDU got hammered in the state elections last Sunday, loosing seats in the local parliament big time.
The votes went to the Greens, which really is a voter’s parking lot, waiting for something better to show up than Alternative for Germany (AfG), which is too extreme for many.
And all this comes on the hills of elections in Bavaria, just to the south of here, which was a disaster of similar proportions.
It seems that the Hessen defeat was one too many for Chancellor Merkel and she called it quits with CDU party leadership. Now she wants to retire, which really is the end of an era in Europe.
Merkel has been the face of the European Union – good, bad, or indifferent. Germany has been the biggest economy in Europe and she has been a staunch supporter of austerity, which has caused political instability on the continent and is a critical factor behind the capital flows going to America that can push the dollar to unbelievable highs.
Let’s pause for a moment and see what had happened – the economies in the south of Europe converted their debts into euros which then doubled in value against the dollar. That triggered a crisis in no time.
In contrast, the Germans carmakers had manufacturing plants coming on line in the US and the weak dollar was a blessing for them. This makes for good business, sure, but you can’t make people dummies for too long. They will revolt.
Looking from a wider perspective, the German election was on par with the global trend that is the rising up against the establishment. Nobody will dare call it “populist” in Germany, even if it would have that label in the south of Europe in every second sentence.
I was in no rush to leave after the dinner, looking though the window and finishing a glass of house white wine. Down the old cobblestone street was the Elisabethkirche, the final resting place of Field Marshal and President Paul von Hindenburg, who was a man bigger than life, a brilliant military commander and later president of the German Reich. He agreed to appoint Hitler Chancellor of Germany in January 1933 since the young man was leader of the Nazi party, which just won the largest plurality in the November 1932 elections. Can’t argue with democracy I suppose.
Now the old marshal is the honorary citizen of the town, but people still steer at their shoes when they pass the church.
There is this unique thing about German democracy – the running parties have their programs and tell you how the others don’t know what they’re doing. Then, after the vote, the results are so fragmented that it takes months to form a coalition. Worse yet, once formed, the coalition, by necessity pursues a compromise program, which nobody voted for.
It seems to me that a moment of deflection is coming in Europe.
Call it the calm before the storm.

West of Lyon, stretching north, as if aiming at Luxemburg, is the great Beaujolais wine region famous for “the only white wine that happens to be red.”
Beaujolais is a light-bodied, fruity wine best enjoyed young, produced in almost 100 villages around the town of Velafranche.
It’s a delight just to drive through the vineyards in the hillsides on a sunny afternoon – the views are breathtaking.
The wine is made of the Gamay grape variety, which is a cross of Pinot Noir and the ancient white variety Gouais, introduced to the region by the Romans.  The grapes are grown on granite-based soil where they thrive. The climate here is unique too – the Massif Central is located to the west of it and has a tempering influence, and the proximity of the Mediterranean Sea brings some Mediterranean warmth.
 
The man in the vineyard high up in the hills, with disheveled hair and thick hands from hard physical labor poured me a glass of his best Chiroubles. It was excellent, with delicate perfume of violets.
“I’m looking for a place to eat,” I said.
“Pa restaurant ici,” he replied. Then he raised his hand a bit making me wait, “je cherche.”
Following his suggestion, I stopped at a Chateau in the valley for a glass of wine and a light meal that made me think that I just died and went to heaven.
 
France is rapidly becoming one of my favorite places in the world, even though there are some strange aspects to it. The country had a balanced budget last in 1969 – it’s been constant borrowing since then, never paying anything back, just rolling over the old debts. It is also a birthplace of socialism, as introduced by the French Revolution. The resulting way of thinking changed humanity over the last 200 or so years. Interestingly, we can see it unravel in slow motion right in front of us. Nowhere is it more visible than in the pension crisis that is starting to drive monetary policies around the world. The traditional way people took care of their future was to build a family structure - the children took care of the parents. The promises of socialism have relieved the children of such obligations for the government was there. The problem is, that for pension funds to deliver on their promises, they need about 8% of annual return. But there are no fixed income investment grade products that can deliver anything remotely close to it and haven’t been for years. This forces the Federal Reserve to keep rising rates and president Trump with the business community will be dragged along kicking and screaming. And this is also why the European Central Bank’s massive bond buying program will likely end in December. This will introduce new reality to financial markets.
 
Oddly, as I age, the big picture of the world matters to me less and less. It’s the little things that I enjoy and they bring quality into my life.
The Rhône-Alpes region is absolutely charming, and I could easily imagine myself living in this part of France.
Somewhere between Lyon and Chambéry will be fine for me. 
​

People have this desire to find an order in the world around them, even if it’s hard to prove that one exists. This is second only to the tendency to see life as linear progression – this is just how our minds work most of the time. 
A good example is the long fascination with prime numbers (they only divide by one and by itself). They appear totally randomly – there is no rhyme or reason for their frequency. So, it should come as no surprise that this was a call to action for some to find a hidden order. In the 18th century the mathematician superstar Leonhard Euler established an elegant connection between PI and the prime numbers. He basically proved that the quantity of prime numbers is infinite. That was it, really.
Next was Bernhard Riemann introducing the zeta function and trying to further encode the primes. His hypothesis says that the points where the zeta function takes the value zero, all line up in a straight line. It still waits to be proven and there is a Nobel prize in mathematics waiting for whoever succeeds. And if one day some lucky soul will, a new problem will appear – what do we do with this information?
Fast-forward to the modern times and the story gets really interesting. 
John Nash was an American mathematician and the only person to be awarded both the Nobel prize in Economic Sciences and the Abel Prize.
Working to prove the Riemann hypothesis, in 1959 Nash began showing clear signs of mental illness and spent several years at psychiatric hospitals being treated. He was not able to return to academic work until the mid-1980s. His struggles with the illness and his recovery became the basis of the film “Beautiful Mind” with Russell Crowe as Nash.
Some people rather sacrifice their lives than admit randomness of the world.
Interestingly, often just an approximation of the order works. The Bernoulli's principle is how the wings of airplanes are designed to create lift. I asked an experienced pilot I know, “how close is the real life flying to the formula?” 
“It’s in the ballpark,” he said. “But that’s it.”
Accepting some level of randomness is healthy, but not accepting the cyclical nature of the world can really do widespread damage. For example, this is the case with the climate change crowd, not willing to consider the impact of decline in sun output, right on schedule actually.
The solution to climate change is not carbon taxes or tradable emission quotas. Let’s look at the last mini-ice age and try to learn from it. We could start by correlating historical events with climate changes throughout history, like the global cooling periods with the fall of the Roman empire or with the defeat of Napoleon in Russia. For those inclined to trade, a cool period will bring a boom in commodities.
But really dangerous are attempts by governments to combat the business cycle. It ends with asset bubbles and mountains of debt on one side and pension crisis on the other. And the cleanup is never pleasant. The tools applied include massive interest rates manipulation, open market operations and capital controls. All this has been done before and they never succeeded even once. 
Doing the same thing over and over and expecting different outcome is a definition of mental instability and it’s very different from what Nash went through. At least he felt that he was at the frontier of knowledge.

There is something special about British Columbia and I felt it when I landed in Vancouver on Tuesday night. The city has a pioneer spirit to it; it seems a little rougher than most while maintaining a charm at the same time. 
Considered to be Canada’s get away to the Pacific Rim; it has the country largest port and is a center for filmmaking, sometimes called “Hollywood North”… It’s a happening place.
Vancouver has also expanded as a center for software development and biotechnology and the constant influx of top quality Chinese brainpower helps a lot in the development of these sectors. 
“Where is home for you?” asked the lady at car rental desk hearing my foreign accent and looking at my Canadian ID and Swiss credit card. “It’s becoming harder to say as the time passes by,” I replied. She didn’t react to the joke, just looked at me and said – “then think about it hard, it is important to know.”
When I arrived at the Best Western hotel in a big Jeep Sahara, I saw that someone parked a beautiful Indian Dark Horse motorcycle under my window, and just looking at it made my evening. 
“Damn it, this guy is going to be riding this bike down on route 101, El Camino Real as they call it, through Oregon and Washington and I have to go to work tomorrow”.
Some guys have all the luck.
Over breakfast I was watching the news, which was dominated but the fact that both, bonds and stocks are getting weak in the knees. “What happened to the flight to quality, why they’re both  going down at the same time?” asked the clean shaved man on national TV looking very concerned. 
Well, I’ll tell you why, sir. It used to be that you couldn’t use bonds for collateral to trade stock. After this changed, it’s all interconnected. You buy government bonds and post them to trade stocks. If the bonds go down, the bank will do a margin call asking you to post more money. The only way for you to do that is to sell stock. This is how the machine fuels itself.
British Columbia is an interesting place to be for one other reason: the province's inexpensive hydroelectric power and abundance of water and sunshine—the many hills and forests make it an ideal area to grow cannabis on a massive scale.  It is an estimated $6 billion a year industry for the province. Well, now the big moment comes – as of October 17th pot will be legalized in Canada. It was just a matter of time that someone got the idea to tax this business. So a lot will change but regulations are good for business, as are sealed boarders. The legalization of pot means that taxes will be syphoned out until it stops being profitable, never mind exciting. Some people like the kick of being on the edge of the law, you will never get rid of them and they make the world move around.
So I was at this “White Spot” restaurant in Burnaby and a man comes up to me. “Need a joint? It will not be the same a week from now.”
“I drink, one vice at a time.”
“Honest to god,” he said before lighting up, “last chance, like BCer to BCer.” 
Didn’t have the heart to tell him that I’m from Poland.
​