Collecting Bank Shares

A proven rule of portfolio management says "Sell the stocks that went up and buy those that went down". Following the yearly rotation system, I am starting to collect Bank HaPoalim shares (pic), Israel's second largest bank. The Israeli banking index lost 5% this year while the TASE 100 index rised 10%. All the banks are stable and making profits, but the analysts's targets are all below or near the stocks's current price. The fund managers that rule TASE have avoided bank stocks not because anything that is happening in Israel, but because they failed in geography in high school. They are convinced that the Echad HaAm street runs parallel to Wall Street in Manhattan. The cheapest bank is Bank Leumi (capital/price ratio of 0.9) but I am betting on Poalim, because in the last three years the Central Bank forbid it to pay dividends, so now it has accumulated profits to pay out to the shareholders. God and Stanley Fischer permitting, half of it will be paid out to the stockholders (moi!) around July 2011.

Thinking of Toilet Design

The toilet area of large commercial projects is always a problem. In Israel, there are laws indicating the number of male and female toilets required according to surface and number of employees and other parameters. The application of fixed rules seems to me wrong, and it is always very difficult to explain to the owner that he has to assign a large area to toilets which necessarily reduces the commercially useful metrage. I am thinkikng on writing an article for a trade magazine proposing a more flexible approach, but I have to come up with something better than the current formula.

For example, the current requirements do not address such situations as (a) people requiring assistance from a spouse, (b) parent and opposite sex children, (c) mothers with babies and with twins, (d) very small or very large people, (e) morbidly fat people and (f) children. The urgency to access a restroom should also be taken into account: while a healthy man or woman can wait a few minutes, old people and women with the period and other categories cannot wait. It can be most unconfortable for them.

There is another problem with fixed proportion of male and female restrooms. There are places where the the proportion of males and females is different from the one implied in the rules, such as football stadiums (majority of males) and concert halls (majority of aged women). There also places where the proportions are variable, so a system should be invented where the site manager can apportion restrooms according to the nature of the public using them. I mean it should be a number of unisex restrooms (Israeli rules never heard of unisex restrooms).

Having to wait demonstrates the failure of the code.

An emerging problem is the need for specially equipped restrooms for people with special phyisical problems. Israel gives a lot of attention to restrooms for invalids, yet they are designed for the generic invalid, and they may not be suitable for special invalids. I am not familiar with this issue, but I will research it for my article.

One (American) approach says that "the planning of toilet facilities in public venues should not be based on "code minimum" compliance. Architects should start to recognize the link between ample toilet facilities and increased concessions revenue... after all, who wants to buy and extra beer or purchase food if you are uncomfortable and are not well served by toilet facilities! Ample toileting means a better economic bottom line." Is there an economic study proving this hypothesis? This approach is unheard of in Israel, so it well could be the nucleus of my article.

No Cedar Wood for the Third Temple

Climate change is killing off the Lebanese cedar. There are only about 1,000 hectares of the cedar left in two reserves in the Shouf and the Tannourine areas. The survival of the trees in the Shouf region is due to Walid Jumblatt, the Druze warlord who planted landmines in the forests.

As known, Solomon used cedarwood to build his temple, supplied by a Lebanese contractor called Hiram. According to the Freemasons, the chief mason working on the temple was Huram Abiff. One of the rituals re-enacts the murder of Huram in the temple by Israelite workmen who wanted to learn architecture from him (apparently it was considered secret). I am thinking that the provision of cedar wood is going to be a serious problem for the rebuilding of Solomon's temple in Jerusalem. Climate change has shortened Lebanon’s winters in recent years depriving its cedars of the vernalization required. This November is ending without a cold day or a drop of rain.

But I am less concerned with the approaching cedarwood crisis than the water supply. It seems to me that Shimon Peres's phantasy of Israel selling water to its neighbors is turning out very doable.

Keeping Everything Copacetic

It seems that America is re-emerging and will be ruling the world for a while. Its main rival, the European Union headed by Germany, seems to be heading toward the mother of all financial crashes. Gonzalo Lira, a Chilean fantasy-writer who follows what is going on in Europe, says that Spain's economical statistics are fake (like the Greek ones) so it is certain that it is the next to go down. (See his illustration). Contrasting with his hyperinflationary prophesies, this time he sounds credible.

Now, if the China bubble explodes, as it may, we shall have returned to the postwar situation where the USA is the sole superpower remaining on its foot. That outcome will be quite a surprise to the doomsayers that have been predicting America's fall and dissolution, like my friend Dennis Mangan. America will not fall so easily because it is a nation that trusts in God. China is officially atheist, Europe is nihilist in practice. God (the concept) has migrated to America.

European worries

Quietly, Ireland's banks are being bled white as everybody and his dog have been retiring their money. (Not Koko, she never trusted the Irish with her money). Some 75 billion dollars have emigrated from Ireland. The country is insolvent. Broke. All the reserves of the financial institutions have been used up. The entire Irish banking system is on the verge of abrupt collapse.

Well, what do you expect from a Taoiseach born in an Irish pub?

Yet payments are still being made, but only because the Germans have taken over the country's finances and lent 130 billion euros. Germans are making a mistake by artificially maintaining the solvency of Greece, Ireland and who knows which others. The euro is under severe attack by cosmopolitan currency speculators and the question is if the Bundesbank (I heard someone call it "Buba" - doll in Hebrew) has the resources to fight off a run on Spain and Italy. I dont think it has.

The euro is in trouble. Europe was always expensive for Israelis, but now the euro is so weak and/or the shekel so strong that Europe is cheaper than Israel. I think shorting the euro would be profitable but immoral. It is against my concience. I am not doing it. I need more time to ruminate on this issue.

Addenda: Germany was able to refloat Greece and Ireland and will have no difficulty with the coming crisis - Portugal. If the dominoes keep falling and there is a run on Spain and/or Italy, the game will turn ugly and the euro may collapse, meaning that Germany will not see a cent of the hundreds of billions it invested and keeps investing in saving the euro. The natural dynamics of financial panics is a progressive acceleration, and the Europeans lost the opportunity to stop the process like Bernanke did in the USA with a monstruous overkill at its very start, immediately after the run on Lehmann and hours before it developed into mass hystery. The Europeans insisted for too long that there was no crisis, ridiculed the Americans, it cant happen here they said and allowed the uncertainty develope into full fledged panic. Now it may be too late to reverse the momentum, the herd is increasingly nervous and wishing to stampede far away from the danger.

Image from Prague

Prague church towers have clocks which also show the exact hour. The newest house is one hundred years old, but everything is excellently maintained and decorated with uber-cute angels surrounded by flowers.

Godless Nation

Czechs are the most godless nation in the world, 90% or so do not believe in the existence of God. On the other hand, you cannot walk two steps in downtown Prague without hitting some oversized and overdecorated church or Cathedral full of statues of armed fighters and dying saints. All Czech wars were about nano-differences in religion, nothing else could move them to slaughter their neighbors. The old Karol Bridge over the Voltava River is over-decorated with bronze reliefworks and statues. Godless Czechs and Japanese tourists (another unbelieving nation) never let an opportunity go without caressing the frozen metal and formulate a wish, half-hoping for the miracle.

Western Slavs

The Czech language is like an Ukrainian dialect. I imagined Prague was like Budapest, but no, there are no drunks on the streets and the Czechs walk fast and with purpose. No Czechs can be seen loitering, they are always working focused on something. They dont seem to be intellectually orientated, no one reading a book on the subway. A decent, clean, stable country.

Visit to Savage Lands

I have been kidnapped by wife and forced to tour Central Europe's cultural offerings. I had to stare at barbaric statues of people knifing each other (pic. a statue at the palace's gate) or being tortured and crucified. A whole day was spent in East Germany staring at the paintings on the walls of the Dresden Staatliche Kunstammlungen Museum. Most of it is renaissance porn featuring nude ladies with fat white asses, some of them in the act of being raped by humans and/or beasts.

It was most amazing to the ethnic changes that took place in Central Europe. Prague's past was erased or beautified: no one could imagine today that for centuries it was mostly a German and Jewish city. Everything German has been erased and the large Josepov Jewish quarter is an archeological tourist attraction. Heydrich planned to turn it into a museum of Europe's disappeared Jewish people, and that is what it is.

We toured the Sudeten. It is a ghost land with large, decaying houses built by Germans who are not living there anymore. It is a Deutsch- and Juden-frei country. It is amazing to tour these depopulated lands and see that history have not stopped, and how the Slav peoples have continued their historic westward expansion, having made large gains even in our generation. It is "fantasti" (a word much heard during the last days) how much damage Hitler managed to cause to the Germanic peoples.

Crossing the Elbe river it came to me how much WWII was an ethnic war between the German and the Slav peoples. The Germans's explicit goal was to increase their "living space" by conquering the lands to the East and to enslave/exterminate the Slavs living there. Slav lands had already many German pioneer settlements such a the Sudeten which had already achieved German majority, and isolated German areas such as Siebenburg (in Romania) and the Volga German settlements in Siberia. The Nazis believed that the time had came to consolidate these advance settlements and to ethnically clean the area through open race warfare. But in the German vs Slav war, the Slavs won and as a consequence, all the German advance settlements were dismounted and the Germans were pushed back to their core area. There is something to say for Rathenau's proposition that European Jews were a German speaking pro-German tribe living mostly among the Slavs, and therefore part of the German eastward push. Yet they were the first to be exterminated. Surviving European Jews stopped speaking German (Yiddisch) and assimilated to the Slav cultures or emigrated to English-speaking countries. Jews like Kafka - now a Slav idol - were in fact advance "soldiers" of German culture (and cause) in Slav lands. He wrote in German, not in Czech.

European Jews did not particularly like the Slav peoples among them most were living, and certainly had little love for Ucrainians and Russians - peasants and nobles alike. Their feeling was pro-Austrian and pro-German. Yet as the Holocaust evolved, all of a sudden Jews lost all their admiration for German culture and became rabid Russians, fighting like lions in the Red Army. I dont think that the weight of the Jews in the German - Slav conflict was determinant or even significant, but it is a fact that after the war, Soviet Jewry universally adopted the Russian language and dissolved itself in the Slav masses. From 3,000,000 Jews surviving the war, today there are less than 200,000 ethnic Jews in the area. The rest has left or assimilated.

The West still conceive WWII as an ideological or an American war. But ideology was most flexible (what is Nazi ideology but German nationalism?) and the military conflicts with France, Britain and and the USA were marginal to the main struggle. The issue was lebensraum, that is, another chapter of the historic seesaw between Germans and Slavs. In spite of temporary low natality and high immigration, these large ethnic groups will not disappear. Another round can be expected in fifty years or so.

British Royal Genes

White nationalists are always talking about the superiority of their race, which reaches its pinnacle with European nobility such as the German Junkers. The most visible representative of European nobility today is the British Royal House, descended from German blood aristocrats. Is Prince William a superior human being? He looks rather dumb, and effectively, he hardly completed his B.A. in Arts. Is his dumbness genetic or because he "fell on his head" (a Yiddish expression)? Wiki says that William was hit on his head by a fellow student wielding a golf club, suffering a depressed fracture of the skull. So it is impossible to formulate any solid opinion on this matter.

Why Canada Does Not Share Its Water?

California is increasingly short of water (partly because wasting it on freshwater swamps for birds and sardines). Some of its delirious water saving laws, such as collecting rainwater, may be caused by sheer thirst. Yet in the North, Canada sits on unlimited RENEWABLE water resources. But it will not share it. "No way!" is the invariable Canadian reaction when water sales are mentioned. Paul Cellucci, former US Embassador to Canada said that

Canada has the largest resources of fresh water in the world. Water is going to be - already is - a very valuable commodity and I've always found it odd that Canada is so willing to sell oil and natural gas and uranium and coal, which are by their nature finite. But talking about water is off the table, yet water is renewable.

Canadian polls tend to run 70 per cent against bulk water export, and the issue reportedly ranks in the Top 5 of concerns expressed in letters to the prime minister's office, suggesting the presence of a febrile protectionist lobby. It is difficult for an Israeli to understand this irrational, even inhuman attitude. We are supplying drinking water to Amman and to Ramalla and Gaza without expecting being paid.

Personal Magical Thinking or Religion

David Grossman is a famous Israeli writer and an extreme leftwing political activist. He is in the frontline in the ongoing war against the Jewish religion. He is not a liberal atheist like many in the West, basically indifferent to religion. He violently fights the nationalism or tribalism clearly implied in Judaism. So I was surprised to learn in the New York Times that in real life, he is ruled by personal rituals based on pure magical thinking. For example:

In a bout of magical thinking, the novel’s Ora tries to protect her son in uniform by leaving home and hiking the length of the country. The idea is that the military cannot carry out the ritual of delivering news of her son’s death if she is not there to receive it. Mr. Grossman, who began the novel when his older son, Yonatan, was in the army and before Uri started, said he too entertained the illusion that by writing in this way, he was somehow protecting his children.

I know the suffering that parents go through when their sons (and daughters for the matter) are in the army during a war. I empathize with Grossman as a person. But he rejected religion because it is superstitious nonsense, yet he cannot free himself from magical thinking and performs personal secret rituals to influence destiny. If to choose between Grossman's magical thinking and the traditional rituals of an organized religion, religion is much preferible. Reading detective novels, the criminal is always compulsed to kill because of some complicated ritual he has invented to exorcise his personal demons and cure his impotence. The Jewish religion has proven methods to chase away nasty dibbuks. The Catholic Church is even stronger in this exorcising business. Pic: a Medieval Jewish exorcism formula.

More Illusory Losses

Continues the bad trend on the Echad HaAm St. exchange. Quote (fictional) Shanghai Chief Detective Chen Cao: "Everything is illusion."

A Possible Future

K writes:

The Irish thing (like the Greek, Portuguese, etc.) was always an illusion - how did Ireland suddenly go from being one of the poorest countries in Europe to one of the richest?

How indeed?

The answer is that they didn't.

The British are thankful that they had not joined the euro. Yet they are facing now a £7 billion liability in any bail-out package.

German Chancellor Angela Merkel raised the spectre of the euro collapsing as she warned: “If the euro fails, then Europe fails.”

Using my deductive powers, I feel something bad going on in Europe. How would look a failed Europe? A failed America? A failed West? Pic: Dragon Chair (a Feng Shui superstition).

Boundary Phase

In fluid dynamics, a smooth linear flow developes chaotic turbulent flow when its dimensionless Reynolds number increases over the boundary phase. I think the world monetary flow is developing symptoms of entering a boundary phase, which may end in turbulence and chaos. For example, Ireland's young and religious population catapulted the country into an economic paradise. Irish GNP was higher than the British one. Yet now it appears that the miracle was much based on illusion and even more debt. Ireland is pulling down the euro versus all major currencies. The euro is once more losing its feet. Can the world monetary structure maintain its stability or will it collapse in chaos? What can a small saver do to protect its assets? Many may be weighting the this question these days.

Hot in Israel

November 14th., 2010

The air conditioner is on.

No winter?

In the College of Rishon

This morning I did a small plumbing plan for the new College of Administration in Rishon LeZion. Why cant we have better architects?

Afterlife Money

I am reading a Chinese political/detective story "The Red Mandarin Dress". It describes also some Chinese finance curiosities such as the "afterlife money". In Chinese culture, the dead need to be sent silver aferlife money to buy winter coats.

Juju loo paper flushed

A new South African product: the Julius Malema kakpapier, a two-ply toilet roll, with Malema's face embossed on every sheet. "Only R 61 for the pleasure of wiping your nether regions with Julius Malema's face". The ANC Youth League leader has proposed to distribute White farms among his followers. The title is from The Times.

The Scientific Fundament of FOG Interceptor

I have been hired to rewrite the Technical Report required by the Municipality's Environmental Department. The original report, written by another engineer, was angrily rejected by the Municipality. I am familiar with the City's engineers and they are of high caliber, yet the "Guide to Technical Reports" contains a four page list of titles to be filled. The document has to submitted in six copies with color prints of complete 1:100 drawings of the factory. One of the titles demands to explain the scientific basis of the wastewater treatment methods, such as the FOG (grease) interceptor. Every restaurant has one and having to explain it is like having to explain the science of the soup spoon. What can I write? The Stokes Law of differential velocity of sedimentation? Newton's Law of Gravity? I had a college who wrote exactly that, Newton's Law of Gravity, with an illustration of Newton under the apple tree.

The regulators were not amused.

Turkish tiles

It is a pity that Turkey's friendship has been lost for Israel. It is one of the original cultures of the world. We have some Turkish ceramic plates on the kitchen wall. They are in my opinion superior to Chinese art.

Large Loss while Sleeping

I have to register in this diary (and try to learn something from it) a large loss this afternoon, while I was sleeping. TASE, the local stock exchange, spiraled down several percentages. The reasons seem to be the Sheshinsky Commission's recommendation to tax (66%) the gas and oil prospecting partnerships, and possibly the disaccord in the Seoul meeting. The Sheshinsky Commission had to decide between the populist, nationalist, demagogic demand to expropriate foreign and local oil companies, like they are doing in Ecuador and Venezuela, or to allow them to take their profits home. If succesful ventures are taxed to death, no one will invest in Israel. I thought Israel was more mature, but it appears that we are much a Third World country. Pic. Trubovich, head of DELEK, the largest Israeli oil company. He says that Sheshinsky is moved by envy. Of course.

Hysteria Attacks China

A weakness of the Chinese mental makeup is its tendency to collective hysteria attacks. A new phase of tension is building up and it may erupt in another mass display of going amok. The drunken fisherman ramming a Japanese warship incident is festering and suppurating. Mercifully, no Jews are involved.

Rome and Jerusalem

This morning I made a consulting job in the Strauss corporate HQ. It is a luxurious ten floor glass and marble building surrounded by parks with statues. A bronze (pic) looks like a cow cut in two with suckling babies (unscrutably, it's called "Asia"). The statue of a nursing she-wolf is Rome's totem. The same idea. Perhaps.

Jews Fined for Eating Lamb

Procopius's Anecdotes are the most venomous story ever written by an employee about his former boss (the Emperor Justinian). Example:

If it ever happened that the year in its recurring rounds brought on the Feast of the Passover before the festival of the Christians, he would not allow the Jews to celebrate this at the proper time nor to make any offering to God at that feast. Many of them used to be brought to trial as having tasted the flesh of lambs at this time and were punished by heavy fines.

He also called Justinian's wife Theodora - a street prostitute (which she had been).

Insurance

Israeli insurance companies are being flooded with profits. It appears that their fees are linked to the performance of their investments in TASE, which was good in the last quarter. I bought more Clal Insurance shares.

Hard Words in Seoul

The Group of Twenty is meeting in Seoul. Paul Volcker says the world is "Unbalanced". China's Zhang Ping said: "Excessive liquidity" (and he was not talking about the rain). Germany's Wolfgang Schauble (pic., hacked) went even further: "I think Herr Geithner's point of view is incorrect in this regard." Fighting words like these were never heard before in a meeting of uber-formal Finance Tsars.

Israeli in the Hungarian Parlament

Scandal in the Hungarian Parlament: the Jobbik Party announced that there is a hidden Israeli among them! It was during the routine approval of European Union's acts, but it got stucked on the participation of Israel in the EU's Mediterranean initiative(Source: Nepszabadsag). Apparently they were talking about Lazar Jeno (pic), the FIDESZ party parlamentary leader.

Hungary is obsessed with Jews. They are less than 0.1% of the population and so scarce that chances are that a Hungarian will never meet a living Jew. But they will not rest till the last of the Hungarian Jews and their much mixed descendants leave Hungary.

Another Bagger Bites the Dust

Yesterday, Tel Aviv, a city built on sand dunes. A hidden hole in the ground, possibly caused by a leaky sewage pipe.

Another Project Materializes

Astonishing, but some of my projects do get made. The city sewage main is so high that I had to install a submerged pump under the parking.

Fasting to Death

The father of a relative decided to die. He had been a writer in Yiddish and Russian and a most interesting person, but I am so impatient that was unable to maintain a long conversation with him. He was nearing 100, very lucid and suffering from the treatment of his diseases. He fasted for a week or so and then took painkillers to end his life, which he did. Learning about fasting, I found that...

For those with advanced illness, hunger is rarely, if ever, a source of discomfort. However, a patient will be affected by dehydration long before suffering any ill effects from the lack of nutritional support. The general impression among hospice clinicians is that starvation and dehydration do not contribute to suffering among the dying and might actually contribute to a comfortable passage from life. The medical evidence is quite clear that dehydration in the end stage of a terminal illness is a very natural and compassionate way to die. In fact, physiologically, dehydration in the dying patient can reduce rather than increase pain and other complications, for example, less fluid in the lungs and therefore less pulmonary congestion, makes breathing easier. Published studies of healthy volunteers report that total fasting causes hunger for less than 24 hours. Ketonemia occurs and is associated with relief of hunger and an accompanying mild euphoria.

I should save this under "Potentially Useful Knowledge". But everything is.

Xenia

A typical well-built Jewish meydele. She is a Maccabi Futball Team cheerleader.

Elections in the Hashemite Kingdom

A year ago, the King Abdullah dissolved the Jordanian Parliament and new elections will be held on Nov.9th. They are being boycotted by the political opposition, the Islamist movement. Most probably the number of seats held by political parties will be minimal, if any at all. The greatest likelihood is that individual tribal candidates will be elected on the basis of their tribe/clan followings.

The last Parliament was considered a fraud by many Jordanians as it did not represent the ethnic Palestinian urban centers but the rural tribal Beduin areas, faithful to the regime. These elections are based on a virtual sub-district system, whose working eludes me. Basically, Jordan is a racially divided country where the lower IQ minority holds the power and exploits the urban majority. Interestingly, the legitimacy of the champion of the Beduins springs from his Islamic roots (he is a true descendant of the Prophet) and the purity of his faith, but he is being attacked by the fanatic Islamic Brotherhood. Peace in Jordan and with Jordan is very important for Israel.

Max Ma's Shanghai

Contemporary Chinese Painter. I'd like to buy one of his works.

Opportunities in Financial Intermediation?

I am working on the world's rightest-wing Jewish "college" project. It includes a highly industrialized kitchen and dining room, with interesting solutions to Halachic problems. So, in addition to the "regular" concern with avoiding crossing fresh food lines with waste flows, here milk and meat foods are separated and there is also a department for fish. The dining hall has a dozen special basins for ritual handwashing and saying of blessings. But my mind is on other things.

Financial intermediation. It is traditional Jewish focus of interest and yes, I am no exception. From Mahalanobis (a blog): The rapid growth of the market-based financial system since the mid-1980s changed the nature of financial intermediation in the United States profoundly. Within the market-based financial system, “shadow banks” are particularly important institutions. Shadow banks are financial intermediaries that conduct maturity, credit, and liquidity transformation without access to central bank liquidity or public sector credit guarantees. Examples of shadow banks include finance companies, asset-backed commercial paper (ABCP) conduits, limited-purpose finance companies, structured investment vehicles, credit hedge funds, money market mutual funds, securities lenders, and government-sponsored enterprises.

How can I get a foot in this fascinating world of golden opportunity?

1400 $

Is it cheap or expensive? I dont know but sure it is going up.

Germany is not impressed

"I don't think they are going to solve their problems," said German Finance Minister Wolfgang Schäuble. "The Americans have already pumped an endless amount of money into the economy via taking on extremely high public debt and through a Fed policy that has already pumped a lot of money into the economy. The results are horrendous."

The German reaction is pure hystery. The Federal Reserve’s monetary policy committee said U.S. inflation is below target levels, and that it was "prepared to provide additional accommodation if needed to support the economic recovery and to return inflation, over time, to levels consistent with its mandate." The Fed sees no danger in inflation, on the contrary, it is trying to fire up inflation, so it decided to print six or nine hundred billion bernankes. At this magnitudes, exact numbers are irrelevant.

Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; William C. Dudley, Vice Chairman; James Bullard; Elizabeth A. Duke; Sandra Pianalto; Eric S. Rosengren; Daniel K. Tarullo; and Kevin M. Warsh. Voting against the policy was Thomas M. Hoenig, who judged that the economy continues to recover at a steady pace.

Anti-Egg Industry Propaganda

In Israeli kindergarten there is always an animal corner, where chickens are fed and pampered. Touching animals helps children emotionally. As adults, they are horrorized by reality and eat only emotionally indifferent food, such as wild rice.

The Red Gold of Cerro Verde

The world largest source of copper is the Cerro Verde open pit mine in Peru. Mineral rich Peru and Chile are prospering. The Peru - China trade (once based on the Cerro de Pasco silver mines, now on copper) is flourishing again. Peru is going to be very rich again.

The Dollar in Free Fall

Bernanke is fearlessly printing dollars to revive the American economy. Yesterday in a meeting with bureaucrats from the Ministries of Health and the Environment, they said that the economy is strong and this is the right time to harden their demands.

Cazuela de Mariscos

Things I miss.

New Economy

Half Sigma reflects on the fact that only about 8% of all working Americans are in the manufacturing sector and the majority is employed in health care, education and public service. So few people works in agriculture that he doesnt even mention them.

It follows that the loss of manufacturing jobs in America does not add much to unemployment and vice versa, the revival of manufacturing will not bust employment. Simply, manufacturing is so efficient and automatic that needs ever fewer workers. America is the number one agricultural and manufacturing country in the world, but its productivity is so high that employ few people.

I imagine that the future will be like farming in Israel, where more people are employed by the Ministry of Agriculture and the Faculty of Agriculture than there are actual commercial farmers.

At the personal level, work opportunities for water engineers are mostly in the public sector, where salaries are withing the range of 2500 to 3500 dollars a month. Independent consulting engineers rarely earn more. The best salaries are in sectors where the workers are unionized, like health, public employees, education, banking. The strongest unions are in Mekorot the Water Company, the Electric Company and the Ports Authority, where engineers earn about 5,000 - 6,000 dollars a month. In fragmented sectors like the food industry, salaries are very low.

Drought in Israel

Last year's water inflow in Israel (groundwater, rivers) was about 700 million cubic meters, which is half of the historic average and about third of the current demand. The deficit is being made up by recycling and desalination, and pumping of groundwater reserves. The whole Middle East is in a worsening water situation.

The idea of a water market (planned by the Harvard Team) is dead: political consideration will not allow water trade among neighbors and in Israel itself, water rights (private property of agriculturalists and old towns) are so rooted in tradition and legislation that cannot be touched.

German Joy

The Germans cannot hide their joy at America's difficulties. Der Spiegel writes:

The country is reacting strangely irrationally to the loss of its importance -- it is a reaction characterized primarily by rage. Significant portions of America simply want to return to a supposedly idyllic past. They devote almost no effort to reflection, and they condemn cleverness and intellect as elitist and un-American, as if people who hunt bears could seriously be expected to lead a world power.

Who is hunting bears? The only bear-hunter I know of is Brezhnev. Is Der Spiegel saying that America will collapse like the late Soviet Union? I think the joy is premature.

Arnold Kling: Invest in Biotech

Original ideas are scarce but this one from Arnold Kling (see my blogroll) is worth considering:

I look at the problem this way. To get something useful in the nanotech world, you need to be able to accomplish both self-replication and being able to control what the stuff does. With "dry" nanotech, we might be able to control what the stuff does, but self-replication is hard. With "wet" nanotech, self-replication is easier, but controlling what the stuff does is hard. Not really knowing anything, my instinct is that it will be easier to figure out how to get living things to do stuff that we want than it will be to get things that do what we want to replicate and construct themselves. So, over a twenty year horizon, my "money" is on the wet nanotech guys.

AK mind works like a Swiss watch. Mine also did at age 12, but now I have lost it. Admirable. But who has a "twenty year horizon"? It is too late for me.

Orckit Moving

Orckit (ORCT) shares are trading sharply higher (13%) this morning after the company received a purchase order for metro aggregation Ethernet switches to be deployed by BSNL, the largest telecom company in India. I'll need to add a digit to my portfolio calculator. It is called inflation.

Neighborhood News

52 Christians were killed in a Baghdad cathedral. The massacre began when al-Qaeda "militants" wearing suicide vests and armed with grenades attacked the Iraqi stock exchange before turning their attention to the church.

Whom are these people fighting? Capitalist speculators? Iraqi Christians? Or makes no difference?

Secrets

From their website:

Walleye Trading is realizing an innovative concept in electronic trading. We can't tell you much about it online, but it is really rather cool.