Canada it is.
I lost my Canadian passport, or somebody lost it for me at the Geneva airport (you know who you are), and for a few days I felt like a man without a country, even though I was still able to travel.
I have more than one passport and can move around, but a Canadian citizen I am, proud and attached to the great country.
Take this picture in:
And don’t make me start with pictures of Toronto; they would take your breath away.
Back in Geneva, Swissport said that my passport has been located and it is with the police. When I signed for the little blue book I was as happy as a teenager with a girlfriend who just whispered: “Boy, you are my star”.
And I do like the European experience, but not for the obvious reasons. I like motorcycle riding here; I like some of the food, Spanish mostly, some views in Ticino, highways with no speeding cameras (Germany and Italy…ahem, tickets never come from there), don’t like European TV – I just don’t get it.
In Canada, and in America in general, the business is booming. They got over the 2007-2008 crisis in a way the European financial system never did or could.
You may say they did it in a cowboy style, but it worked – in the darkest hour, the bankers and Federal Reserve officials got together on one Sunday afternoon in Manhattan, broke God knows how many laws, decided to pump fresh $700 billion into the banking system and the next day the country was open for business.
You can’t do it in Europe, for this would mean money crossing borders, north to south – politically unacceptable.
There is a good story related to the 2007 crisis that just came to my mind. Many people consider it a Lehman Brothers event, but the bank where it all started was Bear Stearns, also one of Wall Street finest.
Now, let’s move back another 10 years or so from that date. The (in) famous Long Term Capital Management ran by two Nobel laureates and Chicago University professors made a huge leveraged bet on Russian bonds.
Enter the Bank of Italy, (there is a connection, just wait) which was trying hard to meet the requirements of the coming Euro zone (this is 1998) but they couldn’t pass the grade, in terms of debt to GDP, so something had to be done. The Finance Minister of Italy at that time was a guy named Mario Draghi, you may have heard of him, advised by Goldman-Sachs. They told him that these LTCM guys produce annual returns in the 40% range (true for a while). Draghi told the Bank of Italy to “lease” gold (the number of 400 metric tones is floated around), which means selling it in the market and invest the proceeds in the Long Term Capital Management. Shortly thereafter Russia defaults on its bonds, LTCM goes down in flames and Italy is out of its gold and its money.
To keep things quiet, Goldman Sachs bought Draghi’s silence by making him the chairman of G-S International.
Then an interesting meeting took place among LTCM investors, with a simple agenda: how much haircut we need to take to bail out the firm. Bear Stearns wouldn’t have any of this and they just walked out.
In 2007 they got their payback and the company was absorbed into JP Morgan for a few cents on a dollar.
At the end Italy did make the Euro membership – it’s a 3rd largest economy in Europe, impossible to roll out the project without them, and Mario Draghi went to an even higher post. They call him Super Mario for a reason.
Woody Allen famously said that every hundred years or so, somebody presses a button and a big toilet flushes, everything on the earth changes and a new set of characters comes in. We may be getting close to that.
Either way, you can find me where the life is a beauty; just look at the picture again.
I will be riding.
I was marveling the Sirkeci train station, once the final destination of the Orient Express train from Paris. It is located on the tip of Istanbul's historic peninsula next to the Golden Horn bay.
It is a touristy place today, with many old style boutique hotels for passengers from the days gone by, as the station is hardly used anymore.
Five times a day the mu'azzins call for prayers from minarets that are all around, and they are synchronized and don’t shout over each other.
Up to four minarets around a mosque mean it was founded by a regular Pasha (still country’s elite), more than four of them means it was paid for by the royal family. It’s also reflected in the size of the mosque, in a big way.
The Muslims here coexist with Christians and Jews – there are more than 2200 active mosques, but also active churches and synagogues.
Then something stroke me in the Blue Mosque – the Islamic religion is full of symbols, and the great ones relate to flowers.
God, the Creator is symbolized by a tulip – single, strong stem, great beauty on top. When praying, the position on the carpet puts the tulip under your heart.
The prophet Mohamed is symbolized by a rose and it’s scent.
There are no paintings in a mosque, there is no personification of God as a human, but there are great flower displays in the city, especially in the spring. God is in the beauty of nature.
It’s an interesting place, Istanbul – by far most powerful city in Turkey, but not the capital, which is Ankara, five hours drive east, into Asia.
The choice is easy to understand – Istanbul lies on both sides of the Bosporus strait, an ultra important waterway, and it has bridges connecting Europe with Asia. In case of any conflict it will be an immediate target, so it’s not wise to locate vital government functions there.
Istanbul is a mix of East and West, sometimes not easy to navigate, but intoxicating still, with a good vibe. I liked it.
The imams, who lead the prayers, are all men, not different from the Christian religion.
I have realized why there never would be a female pope, by the way.
Women always find things and men loose things.
Men lost the Holy Grail some centuries ago, and the last thing you want is a woman pope opening a cupboard somewhere in the Vatican and saying – “here it is!”
You can see that I have been thinking lately.
Constantinople, as the city was called before, was conquered by Sultan Mehmed II of the Ottoman Empire in 1453, after a vicious 55 days battle. To be fair, Mehmed II and his army were remarkably restrained in their handling of affairs after the fall of the city.
For Europe, the exodus of many Greek scholars to Italy as a result of this event marked the end of the Middle Ages and the beginning of the Renaissance.
Guess its a kind of win-win for all of us.
Snapping back to the current day, this piece of news has caught my attention lately,
Just can’t sit, no?
The switch to electric cars is taking its toll on luxury automakers. Mercedes announced it will slash more than a 1,000 jobs, including 10% of management, in efforts to cut $1.1 billion in costs by 2022.
EVs have yet to generate big sales volumes for premium manufacturers, per The Wall Street Journal (translation – there is no money in making them even though EVs require less components). Daimler’s new chief said efforts to meet tougher fuel EU efficiency standards are also likely to dent profits for two years.
How did he come up with two years time frame is not immediately clear.
But more important is what was left unsaid. If Daimler is struggling, Audi and BMW are too – they all operate in the same reality.
Call it a triumph of EU bureaucrats over business sense, killing us slowly.
For now – life will find its way.
I woke up one morning and before the coffee kicked in I found myself driving south on highway A8 towards Monte Carlo.
I called my wife and she asked, “where are you?”
“I am going through Puy de Sancy.”
“Is that a nasal infection?”
“Take all the time you need,” she said, “really.”
So I drove, crossed the Italian province of Liguria, went into France and checked in a hotel by the seashore, half empty off-season. The lady at the reception spoke perfect English with a sweet French accent.
“I am sorry if I mispronounced your last name,” she said looking at me.
“No, you said right. “
It’s a nice place, Monte Carlo, not a big city, literally as small as London’s Hyde Park.
Ruled by a prince, not a parliament, isolated from the world, just looking at the life from the outside, very different from the rest of Europe.
If Monte Carlo is my definition of normal, then we live in interesting times.
Outside of it the nationalist movements are taking hold, wherever you look, pretty much in every country in Europe, but this is how the world normally is. We return to a time when nation state is dominate, when economics are important, but no the deciding factor. There are always nations that are rising and nations that are falling and the natural process of conflict evolve. Nothing new under the sun.
We have declining nations, China is one (the massive protests in Hong-Kong wouldn’t happen if it was growing), Russia is a pale shadow of what it once was. Japan is raising, stable and strong in all aspects including military (second largest navy behind the US, it can project power all over East Asia and there is nobody to stop them). Turkey is taking control of the Middle East, - historically when the region was stable, it was because of Turkey, and their influence lasted for centuries. They managed things good. The Americans are going home, closing military bases all over the world. They will close the CENTCOM in Kuwait next year because there is nothing left to command. We will miss them, no? Just look at the pathetic NATO, what do they mean without the Americans? The Yankees provided stability for a long time but it’s over now and the old demons are coming to the surface. How do you think the Poles feel about the Germans, or the Koreans about the Japanese? There is no love lost there, just pure hate. And when you pray for rain, you need to deal with the mud too. There was never a century in Europe without a major war.
In Monte Carlo I parked my car in the center of the city – I’ve been here before and I knew my ways.
It was a sunny afternoon and I sat on a patio with the view of Casino Royale and Hotel de Paris. Palms, sun, striking women and great cars all around me. But what really stroke me was how green it is here in a very relaxing way.
“Gin and tonic, shaken, not stirred”, I said to the barman. I need to be driving but later.
A two door Rolls Royce drove by with Russian license plates, then another one, looking the same. McLaren 720 was next, but I am too old to get in and out of the low car, so not for me. Then a Ferrari Roma roared by, a beautiful thing.
All not for me, get me a Jeep Sahara, black on black and I will be the happiest guy in the world.
I am a simple man, to which my wife says that I am not.
I like the simple life, can’t help it. You give, you get, that’s what I learned in my 50 years on this planet. But sometimes somebody helps you beyond that, and you never forget. A sweet woman makes the world turn.
Now I am looking at her as she steers ice in the glass with the elegant finger.
When the economics go bad, we become vulnerable to bad ideas.
After the 2007-2008 financial crisis (from which Europe never recovered, just look at the stock performance of their banks) the idea of diversity took root and is spreading throughout the corporate world.
The premise of it can be summarized as follows: nobody would possibly say that young girls and boys differ only in some physical attributes; there is clearly way more to it.
Nevertheless, the theory goes, as they enter adult life they become exactly that - same.
In a broader sense, we are moving from women and men complementing each other, to competing with each other.
Christine Lagarde, ex-IMF boss, currently running the European Central Bank, went as far as saying that the investment bank Lehman Brothers, which collapsed during the financial crisis, would perhaps be still around if it was “Lehman Sisters”.
No Lady, it wouldn’t – spike in repo rates killed Lehman, as it killed another giant investment bank, Bear Stearns.
For me diversity is one of the great fruits of liberalism. The trouble is, that we’re now trying to make the fruits the foundation of it.
Then there are trends that look promising, but the issue is how to handle the outcome. Take AI (Artificial Intelligence), which is basically software that writes itself. An example of how it works was a chess match between Gari Kasparow and IBM’s Deep Blue machine.
Kasparow won the first game, but the machine learned, reprogramed itself and won the second one (IBM didn’t allow Kasparow a re-match after.)
Problem with AI as it advances is that it will replace human work. This is what Elon Musk had to say about it:
There will certainly be a lot of job disruption because what’s going to happed is robots will be able to do everything better than us. Something like 12% of all jobs are in transportation. Transport will be one of the first things to go fully autonomous.
This dilemma led to the invention of Universal Basic Income (UBI), and that is a bad idea, basically giving people money for staying at home. It’s diminishing and demoralizing.
Fortunately, some bad ideas fade away before they manage to absorb too much of our energy. One example is Blockchain. It came into being as the backbone of Bitcoin, and it was touted as the beginning of a new era, a breakthrough comparable to industrial revolution or the internet. To borrow Eddie Murphy’s line from “Trading places” – unbelievable, first Moses and now this!
Blockchain is basically a distributed ledger that updates all records simultaneously, coding any volume of information into defined length of characters called hash, just as with document files that can be “zipped”. An obvious application would be keeping municipal records for example, and so some cities on the US East Coast tried for about a year and finally dropped it frustrated, in a “life is too short for this” kind of attitude.
If Blockchain was not useful for such a basic application, then it’s really not worth thinking about.
Let’s finish with a good idea.
As we’re moving towards Worldwide Income and Wealth tax, it is useful to know that most developed countries signed the CRS (Common Reporting Standard), allowing them to see and tax your assets worldwide, with two notable exceptions: USA and Thailand. US will not snitch on its citizens, and Thailand wants to be a nice place for retirement.
For Europeans concerned about the staying power of the Euro, and the Eurozone itself, and for people who simply don’t like being followed, moving some of the liquid assets to the US seems like a good idea.
Simply put, the US is the best place to have a bank account now.
* Note: Literary website NFReads posted an interview with me about my book "The Traveler". Below is the link:
Tom Kubiak is the author of The Traveler