For God’s sake they should get a couple of thousand tugboats, some good strong rope, and tow this island somewhere closer to civilization. 

In the name of all things holy it’s far.  For God’s sake they should get a couple of thousand tugboats, some good strong rope, and tow this island somewhere closer to civilization.  For transparency I was fortunate to be able to sit at front of the bus for the flight over.  That gave me the opportunity to stretch out and get some sleep, some seven hours’ worth.  It was the other fifteen hours that I had to fill, and what I learned is that to pass that amount of time away you need a distraction.  Like food!  The flight attendants try to feed you at every moment.  “Mr. Bozic, is there anything I can get you?” Let me see, it’s been 22 minutes since my last meal, “sure, how about some dim sum and 4 bags of chips”.  I’m not kidding.

The real estate market is red hot here – This according to the cab driver who drove me to my hotel.  Property values are increasing by 10% annually, and he owns multiple properties. Hmm, interesting.  I was afraid to ask him if he was a part-time mortgage broker.  Let me rephrase that, I was afraid of the answer.  I have this illusion that the Australian mortgage broker industry wouldn’t allow that.

As soon as I unpacked at the hotel in Melbourne, I went for a walkabout.  I went out and picked up two newspapers, which I planned to read from front to back, so that I can get a flavour of what’s current and happening in Australia.  On the front page of The Australian and The Daily Telegraph was this number one story: the original Wiggles are no more.  Yes, Australia’s jewel and gift to children’s programing is going through a radical makeover.  Three original members are leaving for personal reasons; the usual, wanting to be closer to family etc.  Yeah right, one day the truth will come out and we’ll all learn that there’s a Yoko Ono story in there somewhere.  One of the replacements is, are you sitting down, a Wigglette.  Only 22 years of age, Emma Watkins is the new face and the first female member of the Wiggles.  If you’re wondering she will dawn the yellow shirt.

Australian stock market has tanked.  It’s lost all of its gains in 2012. The European debt crisis dominates the business section but the major banks here feel they’re insulated because they have been preparing for the inevitable for some time now.  Australia biggest trading partner is China.  As goes the Chinese economy so goes Australia’s.

The best five year fixed rate I could find is 6.5%.  Gulp!

Melbourne is a lot like Vancouver, from architecture to the overall feel.  Melbourne hates all things Sydney; just like Vancouver and Toronto.

The learning continues.  The bastards drive on the wrong side of the road.  I was nearly killed twice jaywalking.

Revolving doors at the hotel turn in the opposite direction.  Smacked my head a few times – D’OH!

Clearly I speak funny.  I was in Melbourne for less than twelve hours and two people asked me the following: “so you here on vacation, mate?”

The most important thing I’ve learned so far is that there’s no awkwardness in meeting family for the first time. It was odd talking to my cousin on the phone, making plans to meet at the hotel and having to describe what I was wearing so he could pick me out of the crowd.  He found me, and I got a chance to spend some time with him, his beautiful daughter, his brother and his mom, my aunt.  They were extremely gracious and they treated me like family.  It doesn’t matter what happens from here – that will be my lasting memory of this trip.

Until next time

Cheers

Not long ago CAAMP’s Chief Economists, Will Dunning, said to me that economists base their forecasts on their personality.

It’s hard to imagine that Europe’s economic situation could become more uncertain but you have to hand it to the Europeans, they figured out a way.  The “left” is taking control of the political leavers in Europe, and the response was somewhat unexpected.  The markets did not react negatively to the elections in France, and Greece last weekend.  Pundits on Wall Street are suggesting they have already built in the outcome of the elections.  It’s seems somewhat odd that the markets took the elections in stride given past responses to the European crisis.  Ah, but that was on Monday.  By Tuesday the markets started to react as investors finally took note.  The delayed reaction was surprising because recent history suggests that the markets will respond negatively to all things Europe.  Manchester United loses 1-0 to Bolton; the Dow and TSX down 200 points.

 The stock market aside, this wasn’t a good week for Europe.  Some economists are suggesting that Europe is once again in, and heading towards another deep recession.  Last month Europe’s aggregated economy contracted.  Spain now holds the dubious distinction of having the highest unemployment rate of member countries in the EU.  It’s estimated that one in four Spaniards are unemployed today.  You know Europe is teetering when Germany and France’s economy has come to a sudden halt.  The population of Europe is looking to punish someone for the mess there in.  The first big shoe to drop was in France.

There’s a new president elect in France.  President Hollande is a left wing ideologue.  He exploited the mood of the French population, and convinced them that they could tax and spend their way to prosperity.  He convinced the French population that France could recover without having to impose deep austerity measures.  France’s new president wants to move from transatlantic agreements and focus more on member countries of the EU.  This will impact Canada.  The Harper Government has been negotiating with the EU about a new free-trade agreement but now that Hollande is controlling one of the leavers the free trade agreement may not come to pass.  At the very least it might be put on the back burner.  France is not the only country to move to the left.  Greece, they’re back.  Yes, a new government was elected in Greece last weekend, one that promises to spend their way out of debt.  Correct me if I’m wrong – but I think that way of thinking contributed to mess they’re in today.  It’s worrisome to see the direction Europe is headed in.  But I also understand when people feel hopeless, confused and desperate, the impulse is to roll the dice and hope for a miracle.  How much worse can it get?

It can get worse, a lot worse.  What was unthinkable a year ago, countries defaulting, is starting to look more probable.  The IMF will not put up with Greece if they attempt to increase spending.  There may be no more bailouts, and if that was to happen there’s no way Greece could remain a member of the EU.  There’s a real possibility that we’ll be witnessing history; rather appropriate given a number of countries in Europe appear to be history.

Until next time,

 Cheers.

The two words are synonymous with any election today.  It matters little if it’s municipal, provincial or federal elections.  The environment is a political issue to be exploited by all politicians.   If it’s a matter of votes most politicians are prepared to sell their mother or cut a tree down if it means getting elected.  You never know, that one extra vote could make a difference.  A politician’s position on the environment usually depends on which way the political winds are blowing, and for their sake they hope the air is not polluted. 

Personally, my views regarding the environment have changed over the years.  There’s was a time when environmental issues took up about a nanosecond of my conscious thought. That changed when I moved to British Columbia.  I was struck by the bond between the populace of BC and their environment.  At first I thought they were all crazy because in BC, Mother Nature was not to be disparaged, disrespected or disregarded, in any manner.  Their affection for their environmental surrounding is genuine.  Experiencing this first hand, and for the first time, I was forced to re-think my position on the environment.   To be clear, I didn’t become an environmental extremist, that job is far better suited for the likes of Al Gore and David Suzuki.  My thoughts on the environment are not grandiose but rather grass roots.  I now understand why people in BC love their province.  As long as it’s not raining they can indulge in eye candy by simply by looking outdoors.  So when I lived in Vancouver I became more circumspect as it relates to the environment.  My time, and specifically my friends in in BC, taught me to respect the environment.  Not by preaching (okay maybe just a little bit) but by their actions.

Today I scoff at politicians and activists who think our primary mode of transportation should be bicycles. Look people, cars are not going away.  I dismiss those who would suggest that we should sacrifice our standard of living; at the same time provide an economic advantage for emerging economies, by imposing carbon credits.  I believe the Tories were correct to dismiss the Kyoto Protocol, and insist that if Canada is to sign on to an international agreement it has to be fair and just for all countries.   I also believe we should focus on our own backyard before we tackle saving the planet.  I don’t understand why I have to look for trash containers in downtown Toronto.  How about adding flower pots and some flowers in the core?  I could be wrong but I suspect if something looks nice people are more likely to respect their surroundings.   Why aren’t fines increased to $5,000 or 500 hours of community work for anyone throwing trash out of the car window at a highway exit?   Who does that?  Whoever they are, they should pay.   These are fundamental and foundational approaches.  The talk of windmills, electric cars and alternative energy sources is nothing more than an intellectual exercise if fundamental approaches are not established and accepted.   

That being said if big solutions are available, and reasonable, the government has a responsibility to support such initiatives.  I came across the story on the CBC that I thought you might find interesting.  The story is about electric cars, and our government’s lack of support for the manufactures of these cars.   These companies are not asking the government for subsidies but rather regulatory approval.   I couldn’t help but ask myself, why is this happening?  Is the government trying to protect the interests of one province which has an abundance of oil and natural gas?   Maybe that’s too cynical but it’s apparent that politics and the environment go together like oil and water…or a chain-saw and a tree if you will.

It’s amazing what you can learn when you try fight boredom.  I’ve been on so many flights recently that I’ve seen every movie available on Air Canada.  Irrespective of genre, drama, action, comedy, date movies, I think I’ve seen them all.  During my last flight I went to the documentary section, hey I was desperate, and I came across a documentary entitled, “The Warning”,  a PBS Frontline documentary.  It’s a documentary about an extraordinary woman, Brooksley Born, who tried to take on the establishment and tried to warn the world about the Derivatives Markets and Default Swaps.  Ms. Born headed a small government agency, Commodity Futures Trading Commissions (CFTC), in the 1990’s.  Her quest to do what was right was met with fierce resistance by the power-brokers in Washington, i.e. Alan Greenspan, Robert Rubin, Larry Summers and Tim Geithner.  Ms. Born lost her battle, and the world suffered because of it.

I watched this documentary in stunned disbelief.  It’s fashionable in the U.S. to blame the Republican party for the sub-prime mortgage meltdown, and there is no doubt that that they deserve their share of the blame.   Yet Ms. Born was appointed head of the CFTC by President Bill Clinton.  The Democrats were in power, they had a vigilant watch-dog in Ms. Born, but they chose to ignore her.  I wouldn’t do the story justice by recounting events.  You can watch the episode on line, and I highly recommend investing  fifty-five minutes to watch the documentary.  What I walked away with after watching the documentary was that the economic melt-down of 2008 could have been avoided or at least minimized if Congress had only listened to Ms. Born some twenty years ago.  I also don’t understand how Alan Greenspan has walked away unscathed?  And how on earth can Tim Geithner and Larry Summers work in the Obama administration?  But most importantly I came to learn about an unknown hero.  She was moved by principal, and she was extraordinarily courageous.

Watch The Warning on PBS. See more from FRONTLINE.

Until next time

Cheers