Portfolio Thoughts

TASE the Israeli Stock Exchange is falling. I have three big investments go bad: TEVA, BEZEQ and TOWER.

TOWER is chip fab. In the last ten years, I bought it and then, when started to fall, sold with a loss. Not once, but at least five times. Hope never dies.  Idiots never learn.

Bezeq was a communication monopoly bought by Alovitch, who distributed generous dividends (mostly to himself) and emptied the company. I feel the total amount of dividends I received may equal the loss on the stock, but I have no time to check. On the stock,  I am losing 70%.

TEVA is a well-known disaster. Fighting hostile takeover, they went into 20 billion debt, bought a fake Mexican company (they were in a hurry), they got hit by large penalties, and they cannot stabilize the firm. It seems directed toward Total Loss.

Prices are so low in Israel that I took out a loan (1% p/a/)  to buy something. What? The country is entering a phase of stagnation, with no government, the transitory thing we have now will not dare to take painful measures. The bourse will muddle through. There is a large unfilled demand for real estate, that may be a good area to invest. Weapon manufacturing seems promising. The Israel-China trade is booming. Israelis have money to invest, so all investable vehicles will rise.

I have decided to buy jewelry to decorate my daughters. They love it.   

Cumbia La Piragua

Me contaron los abuelos que hace tiempo
Navegaba en el Cesar una piragua
Que partía de El Banco, viejo puerto
A las playas de amor en Chimichagua.
Capoteando el vendaval se estremecía
E impasible desafiaba la tormenta,
Y un ejército de estrellas la seguía
Tachonándola de luz y de leyenda
(Coro)
“Era la piragua de Guillermo Cubillos,
Era la piragua, era la piragua”
Doce bogas con la piel color majagua,
Y con ellos el temible Pedro Albundia,
En las noches a los remos le arrancaba
Un melódico crujir de hermosa cumbia
Doce bogas ahora viejos ya no reman
Ya no cruje el maderamen en el agua
Solo quedan los recuerdos en la arena
Donde yace dormitando la piragua.

Guillermo Cubillos was a trader on the rivers of Cesar Province, Colombia. Like the Moroccan Jews of the Amazonas. I dream of those rivers and time. Improbable, but I am linked by blood with them.  

China inviting intervention

China"s Leadership is feeling strong enough to challenge the West. They say they will stop supplying rare earths, that are necessary minerals for the electronics industry. The price of this precious commodity will explode, making it worth to risk war with China. Black-flagged ships may soon be patrolling the Yellow Sea, waiting for a reasonable excuse to provoke China. Xi' peaceful rise may not be peaceful nor a rise. Very bad.  

Evolution of Greek Intelligence in the Antiquity

Left: the goddess flanked by two lions as in the Lions Gate of Mykonos. 3300 years ago. Those were very smart people. More than us.

The decadence of Greece fascinates me from old. Analyzing genotypes, a clear picture emerges: A small settlement of Minoan people (from Knossos) at Mycenae, in the Argos plain, and the progressive increase of ever smarter people (eugenic selection?). Then, their steady replacement by semi-moronic barbarians from the North. Building Cyclopean fortresses did not help them much. If you continue the curve down and down, you may find the profile of the current Greek population.  Source

Netaniyahu's Divine-Birth Myth

There are many myths surrounding the divine origin of kings and heroes of the Antiquity. Who could imagine that among contemporary Africans should circulate the myth of Bibi being an albino African that reached Israel and his position through a miraculous chain of adventures? Africans have even devised rituals to inherit his fortune, to steal his luck and success. Decapitating chickens is de rigueur. 

More tomorrow, if I have time.  In the meanwhile, let's hope that this night Bibi will succeed in consolidating a coalition and continue leading us. If not, new elections in Israel. That would be rather bad. 

Long Trends Omnia Vincit

The demographic growth and strengthening of the national-religious dedication of the Israeli religious segment is causing increased stress in the government structure. My granddaughters are learning religion in the kindergarten and Netanyahu is proving unable to form a coalition.

Labor got only 10% of British votes and the country is divided and ungoverned. The European Union is holding but the lack of a foreign enemy is making it purposeless. Surprisingly Russian bourse is the world's best, that country has pulled itself together.

China and the US are competing for hegemony. The US is increasingly desperate and aggressive, it all leads to a shooting war in Asia. The war could re-align the world into a new configuration. Remember: there were TWO Vietnam Wars. One with China and China lost. Other with France/US and USA lost. The pic shows how impressive is (or they want to be seen)  the Chinese military: Twenty-something mobile cannons firing at the same time, everything perfectly clean and ordered.   As a former AA team leader, I know how impossible is to achieve this level of synchronization. Even in a parade show.  This pic is fake. But real wars are unpredictable. 

I am expecting a new William the Bastard. In the year 1100 England was in chaos.  The Angles and the Saxons (North Germanic barbarians) were unable to govern themselves. Came William with his French-speaking Nordmen and imposed strict order, divided the land among his sub-chiefs, made a grand inventory and established a well-ordered tax system. The new landowners extracted rent from the farming population and gradually replaced them. This structure lasted 800 years. It was based on stable laws and agricultural rents. When farming produce became abundant and cheap in the early twentieth century and the rents of the aristocracy became worthless and England's structure collapsed. It is chaos again. England returned to island marginality.

BTW, Tom Segev's book 1948 about Israel's first year shows the beginning of a similar structure. Expulsed Arab houses and lands were taken over by well-connected former soldiers with initiative, and a middle class started to take form.  That structure disappeared or went underground with the organization of Israel's legal forms, but I am still suspicious about the origin of some fortunes. But they were small middle-class fortunes, they dissolved in the second generation. Something that did not happen in England, there landed fortunes persisted for many successive generations.

The English are an amazing race. 

35% of Israeli Business Outside of the Law

35% of the business has operate without an official permit and according to the law, they must be closed down.

Regarding building permits, my estimate is that 25% to 50% (in the Arab sector) are built without approved drawings, and about 100% of the existing building ten years old have additions and changes that invalidate the original permit and need to be re-permitted.

They are my potential clients and my market.

But the projects I love most are the bona-fide technical piping/treatment problems, they are difficult but intellectually challenging.