Today I am going to lecture the majority of my readers who are males (80%), rich (of course) and older than their wives (standard.) You need to include your wife in your investment decision making. Women live longer than men. Your wife is more likely than not to survive you.
There is an idea floating around that women should not trouble their pretty little heads about money. That way lies disaster. When you have gone to your reward, the odds are that your widow will live on for many years. She needs money, but she also needs knowledge.
I write this because a reader married to a Hungarian Argentine wanted to meet with me without the Senora. I refused, and not because I do not meet men solo on business. It is because this is silly. While I am not sure we want to go as far as Japan, where the ladies run the household and investing budget and give their husbands an allowance, we do not want to leave the ladies stupid, barefoot, and pregnant like in the Moslem world either.
If you do not train your lady in managing your assets they will either be turned over to a venial bank trust department or mismanaged or squandered. One of my relatives at 94 has run out of money, although it should be noted that she was of a generation when ladies did not do money. But it is a warning to us all.
Today I write about today’s key players in the past. Down memory lane.
From The Economist I learned that Mervyn King, governor of the Bank of England, the British Fed, has supported the Cameron-Clegg coalition govt call for cutting the deficit by raising taxes and cutting benefits. King in 1981 was one of the Keynesian “wet”academics who signed a letter urging Maggie Thatcher, the then-Prime Minister, not to cut the deficit. I guess he grew up. And also noticed that Britain did very well after the heretical Thatcher policies were put in place.
Another recollection is June 1968 when I was a young journalist in Paris with The Sunday Times (of London) but in Paris and made the “splash”, the top story after Pres. Charles de Gaulle one Sat. night refused to devalue the French franc as his minister were urging. De Gaulle wanted to block the speculators shorting the franc. He got no support from other countries, unlike Mrs. Thatcher, becauase he had earlier demanded that the US give France gold for the dollars it was holding.
A few weeks later the devaluation occurred, and France imposed exchange controls, to stop its residents from spending money abroad, and requiring that business receipts be converted into francs immediately. Import finance required that French companies apply for controlled amounts of foreign exchange. The system did not work.
But two of the key players in today’s Europe were around then, Dominique Strauss-Kahn, head of the International Monetary Fund, and Jean-Claude Trichet, governor of the European Central Bank. They learned that you cannot create a bear trap without holding ammunition, which colored their reaction to the Greek crisis. They did not learn from Maggie Thatcher, of course, any more than the USA did.
Their histories will be of importance as these policy-makrs deal with the present crisis. George Papndreou was a kid in a US college town (and so was Benjamin Netanyahu) so don’t count on their memories.
Portugal, my favorite PIIGS country, reported today thatits Q1 GNP rose sequentially by 1%, the highest level in the EU and 1.6% year over year, ditto. Moreover, Premier Jose Socrates (who is of course Portuguese, not Greek, despite the name) and opposition leader Pedro Passos Coelho, jointly presented a bunc of measures to raise taxes and cut spending, just as was done in neighboring Spain. The difference is that growth will make it easier for the Portuguese. Our stock pick there is of course not really a Portugal play at al.
I wrote for paid subscribers yesterday about conflicting advice from two chartists about the future price of gold, which we acted upon. Of course one is in Holland and influence by European perceptions, and the other in the Pacific Northwest, which is mostly American (and influenced occasionally by Canada.) That may be enough to explain their divergence. But we did bail out of a Canada gold play all the same.
A new vending machine in the lobby of Abu Dhabi’s Emirates Palace Hotel sells guests gold in 1, 5, and 10 gram amounts and also sells coins. The only other machines like this are in Germany.
Today’s New York Times website reports that Gen. Khattiya Vavartdiphul, also known as Sieh Daeng, the military advisor to the Thai Red Shirts, was shot in the head while being interviewed by the newspaper’s Thomas Fuller. I am being given a hard time by our Thailand correspondent Paul Renaud for not being sufficiently bullish about Thailand Paul edits www.thaistocks.com and of course has to pitch Thailand to international investors. We remain there but I am reluctant to put new money in as long as the situation remains fraught. No I have never been there, but I have dispatches from my cousins in Bangkok who counter Paul’s optimism, and I am meeting in NY with Thai experts to make sure I get it right.
More for paid subscribers from Israel, Spain, Mexico, China, Britain, and Australia follows for paid subscribers. The blog is late today because of web management business. Note that your editor will be in Boston next week babysitting for three of her grandchildren while their mother attends a British academic conference, and not also that there will be no blog on May 19th which is Shavuoth, the Jewish Pentecost holiday.
