Adoniyahu, the Chief Minister

A 2,600-year-old seal inscribed with the name of "Adenyahu Asher Al HaBayit," meaning apparently  "Adenyahu by Appointment of the House," was uncovered in dirt excavated in 2013 near the Western Wall.  The owner of the seal was a high functionary of the Court of King Solomon. I think that the meaning of "Of the House" is  something like "Adoniyahu from the Government". 

Down Days

The Hod Hasharon 4 houses project is not approved and the client is shouting. Yesterday I had a fight with a regulator and I wrote to everybody that she knows nothing. She menaced me. I am feeling down. Sick and tired. On the other hand, my daughters and family took me to the sea, it was nice, but I am in no shape to swim far from the beach. I am more exhausted and less independent each day.

I designed a project and sent the file to the building company F. to prepare the PLT file and print it. They made a mess of it and the project was not approved. I don't know how to proceed. 

Immigrants Increase German Human Stock

Interestingly, the number of births by non-immigrant German women has been rising (last year, by 3%). I think that the presence of a large population of immigrants from countries with high birth-rates, such as Syria, has a positive impact on the native population. Even so, 23%  (184,700) of all newborns in Germany were born to non-German women. The natives and the immigrants are mutually affecting each other: the natives are adopting some of the cultural traits of the immigrants, although it is the immigrant group that is reducing drastically its fertility in the German anti-children environment. For those who know how difficult is to increase European natality, those 30,000 additional native German babies are a net gain;  a by-product of Angela's immigration. 

AI debating living humans

IBM Research organized a debate about a contemporary issue. IBM machine lost the debate but the very fact that it happened is impressive. This is something new to me. IBM machine could write a better blog and a better paper that any human and no one would know. 

Argentina exporting gas and oil

The Vaca Muerta shale area has entered into production and the country is once more exporting energy.  YPF is planning a total of over 1,700 fracking wells.  YPF, Malaysian Petronas and Shell have been making announcements regarding full-scale development phase. Chevron and YPF decided to invest a total of $800 million in drilling 20 wells in Vaca Muerta play in 2019. Argentina is so rich in natural resources that it may surprise and prosper.  

ROE of 10% in Kever Benjamin

I have been offered a mashkanta (mortgage) to buy an apt. here. The interest rate is about 3%. The price is about 1500000 sheqel = 450000 dollars. The rent could be around 4000 sheqel/month, that is, a ROIC of 3% on he total capital invested. It is rather unattractive. How much is the ROE? If the loan is for 20 years, the monthly payment roughly pays off the mortgage payment. So for the next 20 years the investment would yield zero for me. Only headaches of collecting the rent, paying taxes, maintenance, etc.  In 2040 the value of my 1000000 investment would be 1500000, that is, roughly, 500000/20 =  profit of  25000 p.a. That is, the ROE is grossly 5%. But the real attraction is the steady increase in the value of the property. If I could sell the 20 y.o. apartment in 2040 for 2000000, that is a profit of 1,000,000 in 20 years = 50000 p.a.  then ROE would be 10% p.a. which is not sensational, but not bad. I shall be able to celebrate my 100th birthday on my own yacht.

If real estate suddenly appreciates in the Sharon, I could sell the apt. and take my chips before the investment matures. The speculation is based in the appreciation of apartments in the Sharon, and that is not assured at all.

Real estate prices are sure to rise in this part of the country. Most building activity in my city is TAMA 38 that is reinforcement of an old building against earthquakes, including renovation and addition of two or three floors. The Major has declared that no more permits will be granted, since the infrastructure is inadequate and the traffic is terrible as it is. In the last four years there were 1333 new building starts in Kever Benjamin, that is 333 per year, about 1000 new inhabitants each year, a population growth of 1%. There is a strong public opinion for stopping the growth and save the eucalyptus trees (I am not kidding) so prices will go up and up.

The ROE Return of Equity, which the only important parameter in this leveraged investment, varies form 5 to 10% per annum according the rate of increase of the prices. Generally, real estate is considered safe and stable, but it is not so. In New York they have capped rents, and in Israel, last year, they had a law to tax third apartments. Ten years ago it was debated in the Knesset that rents should be considered as business income, pay 17% VAT and taxed like profits in the stock exchange (25%). To people that has no place to live in, the whole rental business appears as unjust and exploitative, and while they have the vote, no one's property is safe. The risk is too large.

I must be believing I'll live forever, since I am busy calculating long-term profits.

A people that rejects and mutilates the helping hand

Greylock Capital Management's Hans Humes recommends buying very cheap Argentine sovereign bonds. Argentina has temporary political problems, he says, but it is solvent and probably it will not consider a haircut in the future.

HH says invest in Argentina, but the general reaction is that he is a "vulture" trying to make sinful profits from the country's crisis. With such hostile population and xenophobic elite, I would think twice in putting a cent in that country. When asked what's wrong with Argentina, HH answered: "It is a beautiful country, peopled by Argentines."

Greylock, apparently, believes that it is loved by Third World peoples. From its website: Greylock Capital has a well-earned reputation for being a welcome perspective at the table...