It is Obvious

Chris Rick has got altogether too much to say

Archive for September, 2013

Just once. Please just once.

Posted by chrisrick13 on September 20, 2013

It is obvious: the answer is simple

Yesterday I heard another politician on the radio make a passing comment something like: …when what we need is growth.  Alas, it was a member of the Labour party.  Conservatives do it just as much though.

Please just once can an interviewer ask how much growth and for how long.  Then  if the person says 2.5% they can be asked where they are going to put the second London in 2041?  As a side comment they can be asked about the second Birmingham, the second Manchester, etc.  The long term average for the UK is close to 2% which delays the second London in its entirety by 7 years.

Perhaps to a lot of bluster they can be encouraged to give a lower figure of (say) 1% and they can be asked where the second London will be put in 2083.

Perhaps a supplementary would be to ask who is going to build these new cities.

Growth is just not possible or rather long term exponential growth is impossible.  On a bleak note cancer is just unrestrained exponential growth.

Getting 2% growth is a lot easier at the front end of the exponential curve than later.  The growth in recent years is a lot less than that.  At least this puts us on the right side of that curve.  All we have to do is get the economy to a state where it can function with low or zero growth rates.

It seems that growth is all that will enable us to recover our economy so we are stuffed.  Perhaps my generation are sitting there with the hope that things stay much as they are for a few more years until they are gone.

I could be a conspiracy theorist.  Surely all the smart people in government (it even includes some MPs) know all about the futility of hoping for long-term growth?  Are they all just trying to keep things going until they have gone as well?

It is obvious: the answer is simple but it is never easy

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Hurricanes are not selective

Posted by chrisrick13 on September 19, 2013

It is obvious: some people care

Yesterday was a big day.  Did it pass you by?  The central bank of the US, the Fed, did something unexpected.  Shaun Richards nails it in very sure and bleak tones.  His article today is almost required reading.

There was a thought that the Fed would reduce its buying of government bonds from $85 a month to something a little less.  As a result of this belief the markets (of all stripes) moved.  They moved to change values by many trillions of dollars.  Exchange rates moved as well and if you like changed the values of countries measured in trillions of dollars.  It is interesting that an expected reduction in buying of bonds of perhaps $20bn a month caused such big market movements.

…and then the Fed did not do it!  Those trillions reversed and over-shot.  More will happen today.

The expected reduction in purchasing by the Fed is called tapering.  Do not for one minute think that it means the end of QE.  It just means that the rate of increase of purchases is slowing.

What about the end of QE which means getting rid of all those bonds?  A rumour of a forthcoming $20bn change in the rate of acquisition causes huge movements in markets.  What will the redemption of many trillions of dollars of bonds cause.

There is another question that Shaun Richards asks.  If it is not working why keep doing it?  The answer is that if it had not been done then things would be much worse.  These words come mainly from institutions that have a track record of predicting that can charitably be described as appalling.

If you have nothing then you have nothing to lose by today’s events.  If you have spent a life of industry you are likely to see all your endeavors reduced to nothing.  Perhaps you might care.

It is obvious: some people care but not enough of them and not enough

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Hippo, birdie, two ewes

Posted by chrisrick13 on September 16, 2013

It is obvious: I’m here

Tomorrow is the fourth anniversary of this blog.  Nearly 600 posts which puts it at close to a post every other day.  Does not seem like it.

The first post was about speed cameras.  I loved them then and I love them now.  If people want to voluntarily contribute their disposable income to the government it works for me.  I don’t and won’t.  There are complaints that they are put in to generate money.  That works for me.  Taking money off people who break the law and using it for the general good has been a feature of life in this country for many years.  It will be interesting to see what happens as the speed limit is lowered to 20 mph by many councils.

The disappointment I have is that the technology has not been improved.  Those big yellow boxes could be replaced by much more compact devices.  They could be connected to the internet.  You could have your fine delivered to your house before you got home.  You could have it on your smartphone within minutes of committing the offence.  Make no mistake that speeding is an offence, not only to the law of the country but to the population putting lives at risk.

The next step of course is a box in the car that monitors where you are and times your travel between points.  It can run average speed checks for all your travel.  Perhaps when you get a car you have to supply a direct debit mandate to the government and they can just suck the money from your account as you offend.

Scared?  You should be.  I agree with that use of knowing where your car is all the time and I can think of many more uses that I also approve of.  However there are plenty that I don’t.  Uses that people suddenly decide on because the infrastructure is in place.  It is a matter or trust and I don’t.

I have mentioned that the law is set up for 1,000 guilty men go free so that no innocent man is falsely convicted.  Do we have to have 1,000 innocent people die so that idiots can drive faster than the speed limit?

It is obvious: I’m here but how many other people should know that

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Another bump coming

Posted by chrisrick13 on September 15, 2013

It is obvious: you can’t get hold of me

I never slept in when I was at university.  I lived in the shadow of a large church with a clock and a big bell.  I could sleep through the chimes at seven in the morning, but not eight.  Often I did not hear them all but they always got me up to lurch around bathroom and kitchen before the trek up to the lectures.

A few years ago I was asleep in a friend’s house in France and woke to the sound of bells.  I couldn’t be sure how many chimes I had missed but I was on holiday so turned over and went to sleep.  It seemed like a moment later I heard the bells and woke to what turned out to be nine in the morning.  I mentioned what seemed like the small gap to my friend and he told me that the bells ring on the hour and then again 5 minutes later.  This was so that anyone just hearing a bell could stop and listen carefully so that they could count them shortly after to get an accurate time.  200 years ago it was the only time piece for everyone within 10 miles of the church so they needed it.

It was nearly 20 years ago that my watch stopped working.  I threw it away and didn’t bother with a new one.  I sat and looked at a screen all day with the time on it.  I had just got a mobile phone so if I really needed the time I could get it out and look.  An essential for everyone in the previous 50 years had become irrelevant for me.  I had the new essential: a mobile phone.

This year I made one of my slow realisations.  I took my phone on holiday but took the SIM out.  I put messages on my phone service saying to email or text and turned off answerphone.  There is a move to cut roaming charges in Europe.  I suspect that if, late in the day, I avoid huge charges when I came back off holiday many other people are doing the same.  I was going to say ‘the phone companies’ which shows my age.  I should say that the communication suppliers have probably realised it is a market that has been exploited and they now have to cut their charges.  However I paid for communication wherever I was in the world for a several years and have now walked away from it with no obvious harmful effects.

Indeed I just mentioned the answerphone service that removed the tape device on the table in the hall.  Something that had a life of maybe 40 years replaced by something that had a life, for me, of less than 20.

Along the way I have paid a lot of money for things I now realise that I did not really need.  I have got a smartphone in my pocket.  It is a Blackberry so I should call it a smartish phone.  It does act as a phone.  People can ring me.  I can ring people.  I can send and receive text messages.  What about all the other things?  Not much that is essential.  I can get my emails on the move…all of which for the last two years could wait until I got to a computer.  There are lots of other applications of one sort or another.  Not really used any of them.  If I needed to get information from the Internet then it was usually a race with someone sitting near me doing the same thing.

My wife’s phone/tablet is back to Croatia for repairs and I just bought her a phone.  Only £29.  She can make phone calls and send messages.  It will also get radio 4 and hold a decent amount of music.  It does all I need if not all that I might occasionally want.  Gif Gaf will do a phone and text contract for £4 a month.  So for £130 I can cover all my phone costs for 2 years and if I am abroad spend £10  on a SIM to have a phone…if I really want to.

For the internet there are more and more places where it is free.  But for me I’m usually seeing friends or family and I can just use their broadband to catch up with email.  I usually have my laptop and now my tablet but it is easy enough to borrow somebody else’s device.

I have ramped up my communication costs 20 years ago but am now on a downward slope that will bottom out but still has some way to go.  I learnt to become dependent on devices and services that I now discover I never needed.  I certainly don’t need to pay for a lot of them or at the very least not nearly as much.

Once people would ask in the street: excuse me, have you got the time.  I soon expect to see people asking: excuse me, can you tell me who won the FA Cup in 1937.

It is obvious: you can’t get hold of me and it really doesn’t matter to either of us

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Meet the new boss…no change I’m afraid

Posted by chrisrick13 on September 13, 2013

It is obvious: we are all in this together

Mark Carney said to parliament that it would be several years before inflation went back to the 2% target.  Is this the target that is the only measure that the MPC operates to and has been greater than its required 2% since 2009?  Is this the target that the MPC has done nothing to reduce over the last 4+ years?  Is this the target that Mr Carney has said he will do nothing about until unemployment is below 7%.  Shaun Richards noted today that the markets are doing a better job of managing the economy than the people we are paying to do it.  They seem to be doing nothing.  I’m doing nothing at the moment.  Does that qualify me to be the governor of the BoE?

All of this management (sic) is subject to the electoral cycle and the need of the Conservatives to generate a boom timed to peak just after the election.  Had they not promised otherwise I would expect a snap election any day soon.  I wonder that the recovery can be kept going long enough.

The only good thing about all this is watching Messrs Balls and Milliband changing their economic attacks on the government as, one after another, the attack is confounded by events.  At the moment they are on the ‘drop in real earnings’ tack.  This is an easy one to defeat, but not in a 6 word sound-bite.  I’m looking to see what the Conservatives come up with.  Still with Ed Balls’ track record he is bound to be on the wrong horse.

So I come to my favourite topic: house prices.  More than any other time in the past I can see what is happening and read independent views.  This house price increase is a bubble.  House prices were too high even after their 25% drop.  Now they are off into unsustainable values.

If you are timing it as an investment you need to be in and out pretty sharpish.  The deadline is the election if the government can hold it in place.  However they are vulnerable to external events.

For example the Eurozone is growing again except that Greece is shrinking.  Is it not odd that a country that has received bail-out money and all kinds of support to ‘save its economy’ is shrinking still?  Look at the other usual suspects.

The best strategy is to hold on and sell your house at the right time.  Buying and selling in the window is not really going to be possible.  Also the gains will not be much against the costs of the deal (and CGT).

The bubble will be late in bursting – it needs a little more pumping yet anyway.

It is obvious: we are all in this together and there is no way out

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Oh what a lovely war

Posted by chrisrick13 on September 10, 2013

It is obvious: we need a distraction

Difficult to verify but I read that the chemicals Assad is using were supplied by UK.  Would have thought that was a Russian or German thing.  Perhaps the Chinese just bottled a lot of the atmosphere over Beijing and shipped it in?

So maybe the US should be bombing London?  Maybe we could do it ourselves?  It reminds me of Catch 22 where the Americans bombed their own airbase on a sub-contract from the Germans arranged by the base’s mess officer, Minderbender, as it was a lot more efficient.  We’d be a lot safer if we did it.

I am also reminded that when the Labour party came into power in 1964 they immediately stopped supplying arms to South Africa.  Well aware of the coming Labour victory, albeit very small, the French stepped in the very next day and made a lot of money over the ensuing years supplying arms instead of us.  The irony was that much of this equipment was used at the borders stopping illegal immigration.  Still we had the moral high-ground if not the money.

Part of me has been to Syria.  In 1961 I stood at a chain-link fence in Israel and put my right index finger through.  The guide yanked me back as that kind of behaviour could elicit a response from the gunmen on the other side.  I could see Bethlehem in the distance though.

So now the Russians have said that they will remove the chemical weapons from Syria.  This points away from them having supplied them in the first place.  Perhaps their stocks are a little low?  Then you have to have verification.  It is a mess.  Better to put someone in charge who won’t use them.  I wonder where they might find that person.

I also note that India are doing a nice, and now usual, bit of fence sitting.  The groove must have nearly split them in two.  This leader of the non-aligned nations, what they be doing now if Russia had won the cold war, is carefully avoiding worrying about the people suffering in Syria.  I suspect though that it is a sentiment shared with Russia and the US.  There are bigger games at play.

Still most of this seems to be just a rehearsal for the Iranian nuclear crisis that will be back with us soon.  At the time of the Cuban missile crisis there was little attention paid to the price of houses or the base-rate.

It is obvious: we need a distraction, looks like a war will be needed and a small one will just not do it

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Hang on

Posted by chrisrick13 on September 8, 2013


It is obvious: when a storm breaks you sail for a safe harbour

I advise people when the Grand National comes around to make each way bets from a selection of the six or so favourites.  This will give the best chance of the longest interest in the race while you watch it and the best chance of a return, though look at the cars bookies ride around in before you think about giving them more money.

Never bet on a 100-1 long shot.  First of all the bookies set them all at 100-1 as there is little interest out there, but from a race ‘book’ perspective and their real chances the 100-1 horses should be out at 1000-1.  Your expected return from such a bet is very low.  Depending on whether you are considering the bet to be a bet or entertainment you need to decide how much you want to pay for entry to the entertainment.  (Same deal applies in a restaurant where what you pay has little correlation to the cost of the food.)   While I’m at it your expected return (amount you win multiplied by the probability of winning it) for the Lotto is very poor.  Worse than betting on a horse race.  Indeed the best expected return for most bets for a long time was the football pools where you could even apply your expertise.  And while I’m still at it the place where the ‘bookies take’ is most open to view is a roulette wheel where the ‘0’ represents the bookies take…about 3%.  But now note that in Las Vegas they have grown to 3 zeroes on a wheel which triples their take.

So in 1967 I apply my advice and Foinavon wins the National at 100-1.  What an idiot I am?  Not quite.  It was a poor bet before and it was a poor bet afterwards.  46 years later and no repeat.

So it is with houses.  To make a ‘profit’ out of a house (nobody does) you need to time sales and purchases right.  This is much the same as going down to the betting shop.  It is not something you will do with your house because the needs of your family will drive that.  For an investment property (sic) you might be trying to do things.

So I have said for a while not to get into property.  Prices are still, even in London, 25% down from their peak in 2007.  By any sensible measure of prices they are too high.  Most importantly the price is a function of the average wage multiplied by the average mortgage rate where that average person can pay the mortgage and still have enough left to live on.  With wages declining in this country in real terms, which they have done for some years now, and constant but low-interest rates, houses should be drifting down in value.

London is operating to a different set of conditions and the government is luring people to take on mortgages elsewhere.  So prices are stable and even going up.  All other conditions point to house prices going down and many point to a rapid fall.  ‘When’ is the big question.  The answer is simple: after the election.  The Conservatives will win and stop the support for mortgages or Labour will win and we will, economically, enter the dark ages.  That just supposes that interest rates are not forced up by market forces before then.  Do not worry about all those people lured into large mortgages who cannot pay them any more.  You and I are standing surety for the loans.  I’ll pop round for the cheque when it happens.  For every £60bn lent by the government you need to set aside £1,000 for each member of your family.

So buy a house now and watch it go up for a quick sale just before the election…naaah.

If you have a house, hang on and sell in early 2015 – if it works for your life plan then do it.  What will you do with those bits and bytes in the file of your bank.  Don’t think of it as money.

If you think that there is going to be a lot of economic chaos and want to keep some value to be traded or spent later, then sit tight, invest in yourself and put your seat-belt on.

It is obvious: when a storm breaks you sail for a safe harbour or point your prow into the wind and work hard.

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Posted by chrisrick13 on September 7, 2013

It is obvious: there is nothing like a good dictator

I should have a ‘position’ on Syria.  Can’t run away from stuff like that.

I am incensed by treatment of anything or anyone that is not even-handed.  How long did it take for anyone to do anything to Saddam for gassing his own people and then Iranian solders?  Difficult to frame an answer as no government did anything.

What did anyone do to Menachim Begin for his terrorist activities?  Nothing other than let him become prime minister of Israel.

Pretty much the same goes for Robert Mgabe.

The list of atrocities going unpunished is too long for me to even make a good start on it.

Then I come to China and Russia refusing to let the UN Security Council act and: ‘interfere in the internal affairs of another country’.  I might mention Tibet that no longer exists as a country.  I might mention Afghanistan from 20 years ago and many other ‘Stans’.  Not only not even-handed but two-faced and hypocritical.  Not something I would dare publish were I living in either country.

Then I might refer back to Egypt where the popular uprising was supported without the need for any physical intervention.  An election took place and the ‘wrong people’ won.  No matter, it was democratic.  Then the president spoilt it all by granting himself all sorts of extra powers that the people did not give him.

Next I might mention Libya.  There was proper physical intervention and things are different.  When Gdaffy Duck was captured he didn’t even last 24 hours which showed how bad he was.  Now nobody really cares who is running the place.  By definition it has to be an order of magnitude better than what went before.

I am reminded of an SF story of which many formed my outlook on life in my teen years.  Some religious group was running a world in a pretty horrible way.  An external version of the UN arrived in spaceships at the world and told the people in charge to act in a decent fashion to their people.  The leaders and their many thousands of clerics just bayed at the UN and committed even worse atrocities.  They were given another warning which they ignored.  They had forgotten that they were in a world of advanced technology and each carried a chip in their heads that enabled them to link into the local version of the internet.  In the middle of the leader’s next television appearance the external forces took over the world’s defence satellites and lasered the leader on tv and all his clerics.  There were a few left in unreachable places.  When they emerged they had a very different idea about how to run a world.

So my answer is that any leader who does something bad should be tried at the Hague.  If they are found guilty then send in whoever you like to go and get them.  A lot of world leaders might spend a lot of time looking over their shoulders and acting a little more humanely.

I have another twist to this idea.  Offer any leader who might be acting badly the choice of one of a dozen Greek islands, £500m and protection for two years if he moves on within the month.  If not the due process will be after him.

I have heard many times that a democracy is a lousy way to run a country…but it is the best that we have at the moment.   I can think of a better way.

It is obvious: there is nothing like a good dictator, alas.

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Mafeking relieved!

Posted by chrisrick13 on September 6, 2013

It is obvious: I know what I’m doing

I was once posed the question: you are interviewing candidates for a job as an analyst at a stockbroker.  The two candidates are equal in all respects except that one had a track record of getting 70% of his recommendations right and one got 90% of them wrong.  Which should you employ?  It is obvious.

In a very short time the governor of the Bank of England has proved himself more incompetent than the guy he took over from.  Given the forecasting record of the BoE he listened to them and publicly said that he would not be raising interest rates any time soon.  Bond yields are on the up so he will soon have to raise interest rates.  The economy is on the up so he will soon have to raise interest rates.  He can do a lot more QE.  This will push inflation up at a time that inflation is…going up.  Isn’t he supposed to keep it at a level last seen 4 years ago?

So I will be generous.  Hannibal Smith had it right: I love it when a plan comes together.  The Conservatives have a long-term plan, not for the country but for re-election.  I was convinced they had it wrong.  I do wonder now.  Ed Balls was hammering the coalition for its austerity policy.  No chance of growth.  What now?  He was actually right as the coalition has achieved little austerity.  Ed Balls was predicting a triple-dip recession when a double-dip had been revised out of existence.

Ed Balls was at the heart of the disaster that was Gordon Brown’s disastrous management of the British economy over 12 years.  Simply they got it wrong.  Now Mr Balls has it wrong again.  Sacking him is not an option for Mr Milliband.  Yet in all he economic debates leading up to the election Mr Balls is already penciled in for ‘Null Pointe’.  He really should be employed as an economic adviser to the government.

So the economic crisis is all over.  We can relax.  We can breathe a sigh of relief.  We can go out and spend.  Down in the dressing rooms the fat lady and her sisters are just putting on the last touches of makeup.

It is obvious: I know what I’m doing, or rather what I’m not doing

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Little brother

Posted by chrisrick13 on September 5, 2013

It is obvious: there is nothing new

In my attempts to regulate or at least watch my wife’s consumption I have vacillated between cash and cards.  Cards are too easy.  Cash cannot be tracked.

Which way do you think that banks and shops would rather we went?  I’m not doing anything illegal so I don’t mind going electronic and being watched all the time.  I don’t mind entities seeing what I am interested in and increasing the percentage of advertising I receive that is interesting to me.  I have enough inertia when it comes to spending, and little enough money, that I can look longingly at something for months and then not buy it.

I don’t mind being stereotyped by my behaviour because I am random enough that I know they will get it wrong.

But what if I am watched and they do get it wrong?  Will I be scooped up by a bunch of very large gentlemen in bullet-proof vests and have to spend a several days proving that I am harmless…well, mostly?

Do I mind, as with justice, that a 1,000 guilty men go free so that no innocent man is convicted?  A thousand of us spend a couple of days in jail and a terrorist is caught.

I could apply my simple solution method to the border controls.  Check only 1 in a 100 or 1000 or any number you like.  If you are caught trying to get in when you can’t come in then go to jail for 10 years before you are sent back to where you came from.  If that was put in place you could have a population of illegal immigrants tracking their way back to their countries at 10 years for each leg.

So I had a brilliant idea after spending 3 months drinking coffee with a swipe of my Barclaycard.  Could I build something that I could wander the streets with or simply stand on tube trains in the morning and take £5 off every Barclaycard I came within a yard or two of?  I could earn enough on a commute into work not to bother actually working.

I already knew it about phones and I had heard of parents putting chips in children.  We can be tracked.  They do it for expensive cars.  In the UK we are not subject to this much as we don’t have many toll roads.  In the US everyone has an EZPASS you just drive through the toll and it painlessly takes the money without you doing anything especially stopping.  What if someone wanted to know about people’s movements in general?  Just put an EZPASS reader on the roadside.

We don’t have it in the UK…got an Oyster card or a Freedom Pass?

But I read of a better use for the card readers.  Much more fun.  As you pass Barclaycard holders or Oyster cards just copy the identity stuff.  When you have a lot in the device switch to swap mode.  As you pass a card, swap the identity information with one of those in your device.

If I’ve thought of it then so have a thousand others and I bet one of them can build the device.  Hope they put the instructions on the internet.

Read the book.

It is obvious: there is nothing new but there are plenty of new uses for old things

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