Power And Dollar

My Grandma’s Smiles


When I first met Sandra in a webinar, I found a strange sense of familiarity.  Her hair was getting sandy, but I could not quite tell if she were 60’s or 50’s.  She wears her hair to her ears.  She gave me a sense that she was quite sharp.

A colleague of mine requested a meeting with her department and it turned out she was to meet us at her desk.  I led my colleague for it.  I finally understood what was playing my mind.

She is in a very comfortable pair of jeans, some kind of unmemorable tee shirts, and very fitting sneakers.  She looks as if she is ready to actually play some sports.

Her cubicle is at a corner.  So, “a corner office without having to earn it with blood on your hands” I said to her.  She took the “corner office” part as a complement.  There are small desk calendar pages stuck on the wall with jokes about women and science.  She has a calendar from El Pronto.  This is a very very crowded cubicle: full of ornaments and decorations.  She must like Mexican food and probably a Spanish aficionado.  My guess is probably right again.  She got numerous little ornaments that are in Spanish.  I think that picture of hers with a child is very likely to be one of those adopt-a-child program where the donor commits a monthly donation in exchange for a closer relationship with the child.  She could be a girl from anywhere from Mexico to Chile.

This is probably her husband.  Both of them look like educated hippies.  A map of the bus is on the wall.  Some bicycle toys on her shelves.  I bet they do not own a car and ride bicycles to work.  So her clothing makes good sense.  Some technical reference books that, by book jackets, should have been printed earlier than 1980, probably mid 70’s.  This field has evolved a lot since the emergence of cheap computing powers.  They have to be her college textbooks rather than some specialty reference books.  That will work out that she was born in the late 50’s.  So, she is more like the age of Kevin Arnold’s sister rather than Kevin himself.  Thinking of the attitudes toward women pursuing science at that time, she must have had a strong will at least back then.

This cubicle is full of pictures of cats, dogs, Spanish decorations, chocolates, magnets, a picture of a Hispanic girl:  everything but a hint of her own children.

She speaks in a very soft and comfortable voice.  I let my partner do all the talking and keep searching her face and her cubicle because I still cannot shake what of her that gives me that strange sense of familiarity.  I lean on her wall and a full lot of magnets fall.  I am so embarrassed and I quickly pick them up.  I look right into her eyes and apologized.  She friendly smiles and tells me: “many people do that.  Don’t worry.”  Her eyes finally reveal the secret.  She got my grandmother’s eyes.

Her eyes are tired but forever optimistic and radiate benevolence.  Her cheek and chin are exactly my grandma’s when she smiles, a very sweet grandmother kind of smile.  Probably part of the ageing process, her cheeks are running thin which makes her chin sharper than it actually is.  Yes, she got my grandma’s hair too.  She certainly was a brunette but her hair is actually grey or white rather than sandy.  The hair is thin, probably soft.  I remember the day when I left home and she was already 82, she just started using her hair dye and I noticed her white hair.  She is definitely petite, maybe 5’2”?  Her small frame may mislead you to think she is weak.  Her forever optimistic eyes tell you that she is stronger than you think.  If she were born in the late 50’s and she is about the sister of Kevin Arnold, then she is not showing her opinion about war and peace in her cubicle.  But then, my grandma never showed her opinion or even emotions about any of the warlords rampaging around her nor my grandfather’s hometowns in the 20’s and 30’s, Japanese or Communists in the 40’s.  Throughout all that time, she was the talk of the town, starting from who her groom to be and who actually was, to her travelling after marriage, to how she managed to maintain her life style during the 40’s.

“How did you remain optimistic after what you had gone through?” went to my lips and I suddenly realized she is Sandra and not grandma.  So I changed my sentence to something else since it was way too late for me to simply to eat what I had in mouth.  She answered in her own pace.  She comfortably crosses her legs with the technical questions my partner thrown at her.  Now the name “Jane Austen” came into my head all of a sudden.  As I am telling Jane Austen to go away, she twirls back and says: “she must possess a certain something in her air and manner of walking, the tone of her voice, her address and expressions, or the word will be but half-deserved.”  Sandra is a little reserved, or private or even timid, indifferent to this world while my grandma gave a sense of royalty without a kingdom and servants.  My grandma’s privacy is “you have not earned the privilege to know.”  Her indifference is “I saw, I came, I survived.”  Her benevolence to strangers is “I love you because I want to earn your loyalty” while her benevolence to familiar is “I love you all sinful or not, you are all my children.”

Does she have all these cats and dogs to save her regrets of not having children?  I was thinking “Sandra, you can always visit my children. My wife tells me I am not a qualified father anyway.”  But you know, I have my regrets too.  My grandma was 90 years old when her time came.  I was the only one on her mind in her last days.  I could not make it to see her.  She dragged on herself for two days to wait for me.  I never got to say goodbye.  She spent the most time with me of all her more than a dozen grandchildren and I did not say goodbye, nor attend her funeral.  In fact, the time she spent raising me probably is the best time of her life after the war.  She got her affluent and comfortable lifestyle back.  Of course time had changed so much that she did not have servants, plural by the way, like her old days.  However, money was no longer a constraint on her expenses.  Of course, she had changed so much from her wild days that she never spent much anymore.  She could have appreciated a sense of fame from my father, her last of seven sons, just like she had from her father the kingpin of gambling, then from her husband THE benevolent tycoon who never evicts tenants from farmlands, then from herself for spending money all over the province and gambling to earn her living through the war.  I was not even able to afford her one minute to say one word for her last moment.

I was cruel and impious.  One can apologize for his wrongs to his victims and one can compensate for wrongs.  But one cannot apologize to the dead and one cannot compensate for the dead.  It took me a long time to understand what it is like to wish someone away and be happy for them, just like she was happy for me that I was grown and longing for my return for one last time.  In fact, she willed all these for me.  Yet, I did not let her see how happy I was.  I did not let her know what made me so proud.  Would she have understood what or how?  Probably not.  But she simply wanted to see that I was so she could close her last chapter.

She dragged herself for two full days for this chapter.  She dragged herself to the last moment when she gave up all hope, gave up all the joyful memory, deliberately removed her mask for there is no hope to hope for, nothing would be good enough to exchange for one last glance of her last grandchild, the most promising grandchild of the most accomplished child.  Why could I not return as simple and as good as a goodbye for someone I would never meet again, for someone who has been longing for my good, and for her eternal, or even internal, peace?  It was a simple dying wish and I squashed it like a pesty fly as if it did not even register in my mind.

Sandra, I know I cannot re-do something like this.  I know I cannot apologize, recover or compensate for my sin.  Even a confession would not work.  But will you want to play with my children some time if you like kids these days?  Or if you want adult kids, will you want to spend time with me and my wife?  If you like travelling so much, you must have stories and you probably like other people’s travelling stories.  We are well travelled people as well.  Will you want to come and visit us?  Sandra, I fear to open myself up.  I did that, crossed a boundary and lost a friend.  I sinfully, cruelly and irrecoverably lost my grandmother.  So, instead of talking to you, can you instead work here for a few more years, stay close to my department so that I can see more of my grandmother more often?


October 14, 2015 Posted by | Current Events | Leave a comment


2013.11.01 (921字)

過了好半天才回答了另一個「為什麼我們要這樣拿棋」的問題。正是我要回去談談棋理,又來另外一個童聲可稚的問題:「為什麼我們要黑棋先手?我們為什麼不讓白棋先走?」 我正要說白棋王和黑棋王傳說的標準教科書答案的時候,我改變了主意了還明知故問: 「為什麼要白棋先走?」 「國際象棋是白棋先走。」 「為什麼國際象棋是白棋先走,而不是黑棋?」 「不知道。」於是,我開始了: 「 那白象徵什麼?那黑是什麼意思?」跟着是預期的沉默,「那黑色讓你想起了什麼來了?」我可樂了- 終於輪到我來問問題了。

「黑暗。」「如果你說黑色讓你想起黑暗,那白色像什麼?」 「光明」「 好了,你不覺得先手的話更容易贏嗎?」許多不同的「係」,「對」,「是」,「예」,「はい」應運而來。






[1] Sinister – Latin for both the direction of left and improper

[2] Dexter – δεξιτερός which later in Latin for both the direction of right and proper

[3]路加福音Luke 9:25

October 14, 2015 Posted by | Current Events | Leave a comment


2011.12.01 (2399字)






“我們慶祝冬至,”我告訴他們。 “這是一年之中黑夜最長的一天。這一天之後,黑暗退去,白昼延長。這一天是冬季的中間。因此,每一個人都回家團圓。”他們的臉告訴我,他們理解為一個嬰兒的出生。然後,我記得這次談話的要點 – 禮物,所以我說,“我們然後交換禮物”。孩子們歡呼相隨。







測量時間是一件不容易的事情,不僅因為時間是一個虛無縹緲的概念,並且需要製造不是一個而是多個相同的設備,隨著時間的推移還有維修,工程經驗,數學和除此以外,人的管理。平均分配一天成十二個抽象無實的單位容易嗎?是否一日十二份不科學呢?二十四份科學嗎?為什麼人要痴迷地用十二的倍數來測量時間而非十的倍數?十二非單是一年的月數,並且使用此數即包含日月陰陽於其中。人的一切文明活動:日出作,日入息,春耕秋收,孰未嘗受天象管轄?所以,人竭盡所能地以達到天人合一: 測、度、量時間只是這個想法的反映。為什麼日本以五行日月翻譯命名一個星期中的七日?難道希臘人的24(=12×2)個字母是巧合?還記得梵文有七對(七長七短)韻母嗎? 如果認為人總是想討好神靈,那麼我寧願補充,人總是想與天象保持一致,以好上承天運。




我們響往中庸是因為了解到“天人合一” 。古人認為成功的行動總是與天象一致。我們寧願環繞中心以類聚(合一),而不是以中心來群分。不可避免的是,一旦以中來分,一個社會,立即撕裂成二。如果我們希望生活在一個和諧的社會,就必須有凝聚力、包容力,那麼我們將不得不走中道、中庸。因此,午時正中均分地包容日麗中天的時分,子時正中均分地包容兩日之界,冬至正中均分地放在冬季正中。而不是以子夜來分兩日、冬至來分兩年。年雖是天運,新年却是俗立以別年。更何况要冬至、耶誕和新年三環相扣並置取的正是黑暗已盡、光明將至的意思:要人新的一年充滿希望。


如果不是因為朱熹的努力把佛教融入中國文化,唐武宗可能不是中國最後一個滅佛的皇帝。從白馬寺始,至朱熹止,中國花了超過一千年來整合佛教。如果不是因為如哲學家革利免等主動地將基督教與希臘哲學整合而成為羅馬社會的一部份,基督教能在短短的二百八十年(米蘭赦令)成為羅馬國教?中國整合佛教的時間是基督教整合希臘文化從而成為國教的三倍!這中間經歷了漢唐。試問中國又有幾個漢唐?又內耗了多少精力?將來是一齣基督教戰勝另一個政府的戲、中國再一次漢化異族宗教、抑或是又一場長達一千年政教相爭的戲碼?主持詮釋者, 可主宰以無意義的數字來代表一個星期的六日和以禮拜日來代表自己希望的訊息,或是真確無誤地剖視一星期七日的原義(如日本)。主持詮釋者,主宰受訊人。中國是既如以往的受訊人,或是新的詮釋者?


難道只有我們慶祝的春節才重要,冬至不重要?尤其是其他人已在以其他名義慶祝冬至、傳達自己的符號、加強自己的烙印、延續自己的文化,中國為何在冬季缺席?是讓中國人的消費能力去維護、延續一個希臘化的基督教符號?基督教在一年最黑暗的時間,以一個新生嬰兒 – 總是希望最好的象徵 – 為世界提供了希望的訊息。在一年中最黑暗的時刻,中國有論述、傳達、延續任何自己的符號和價值、以貢獻於世界思想史之上?


修殿節 – Hanukkah,猶太教節日。

米蘭赦令 – 耶元 313年。

科學 – “可推理得之,可傳授之” 是亞里士多德的定義。與近代定義有別。

革利免 – 基督教早期神學家。常被稱為亞歷山太的革利免(Clement of Alexandria)。他將基督教信仰融合希臘哲學思想,使哲學思想成為基督教的思想工具。

冬至來分兩年 – 冬至後第三日的日照時間比冬至當日延長了第一分鐘。新年是置於耶穌出生滿七日後割禮之日。割禮的重要性與彌月相仿。

October 14, 2015 Posted by | Current Events | Leave a comment


2011.11.10 (1294字)

美國是一個多元文化的國家。印度的光明節剛過,美加的 萬聖節隨後便到。因為萬聖節越來越近,孩子們試穿自己的萬聖節服裝,幾乎成了最近這幾天的例行公事。今天,他們又在試穿自己的鬼怪萬聖節服裝時,突然問我:光明節是什麼呢?,這一刻令我恍然大悟: 我不僅要告訴孩子,還要告訴各位,关于光明節的事,還有萬聖節和我們-人的事。

不管萬聖節是從諸聖日或蓋爾的“夏季結束節” 演变而来,他們都传递着要我們尊敬離別的訊息。好好的準備這個節日之後,我們也就已經好好的準備渡過冬季的空虚和死寂。現在,我們當然喜歡這個節日 – 全因为怪异服裝和糖果的樂趣。有趣的是,充滿鬼怪的萬聖節讓兒童笑走了對漫長黑暗冬天的恐懼。看到有趣的鬼怪帶給我們渡過冬季的勇氣。



噢,奇怪嗎?似曾相識啊﹗朔望週期?久違了﹗也許只是我們再不常使用朔望。事實上,我們也做奇怪的事情。還記得復活節彩蛋嗎?復活節就像光明節一樣,相對於陽曆而言是同樣的飄忽,也一般的有序—— 復活節是每年中國農曆三月初一後的第一個星期日。為什麼要這麼奇怪的慶祝復活節?其實,人也並不總是使用陽曆的。剛剛定下復活節時,人們還在用希臘的陰陽合曆,就像中國人和印度人一般如出一轍。事實上,當時有更多的人使用五花八門的陰陽合曆。


是的,耶誕幾乎是一樣的。耶穌真的是在格列哥里曆的12月25日出生嗎?幾乎沒有任何人認同這日期是準確的。牛頓也認為耶誕是故意放在12月25日,因為一個冬至後三天的一天, 黑暗已經後退三天了的一天, 將更完美地傳遞一個由嬰兒給人帶來最積極的訊息,對未來充滿希望。

復活節是“周而复始, 万象更新” 的節日,因為它正是春天的時候。清明節也總是 4月5日。清明節提醒我們,時間長河和我們的血脉延绵不断。履行我們“思遠”的職責後,我們就可以“复始” 、“更新”了。


我們慶祝不同的節日,不是出於不同的原因。而是人類認識到,万物有时、物事有期 。古人明白到能夠順天應人,才能事半功倍,所以天運一時、地隨一候,而俗立一節、人作一事。這些現象地不分南北,時無远近;同樣的現象,對跨文明。節日獲得不同的彰顯,只是體現的人以不同的符號,表達相同的情感,和對天地的體會罷了。古人只是用節日來提出這些和“天人合一”的訊息,因為人,不論是前之古人,抑或是後之來者,都共享人性。

光明節—— Diwali 或譯屠妖節, 印度第一大節。



October 14, 2015 Posted by | Current Events | Leave a comment


何德鄰                                2014.05.07 (2455字)


如果黃帝建立了中國,那麼中國實際上是小得可憐。如果秦始皇建立了統一的中國,是因為秦統一了字、幣、度、量、衡、軸,那為什麼不統一語言?難道當時沒有方言?或者是未明白方言的弱點麼?非也。事實上,古人早早就懂這個弱點了。所以孔子才設法編理詩經的緣故 – 古人學習詩經,是因為詩經中所載的字是唯一所有國家從西周以降共用的字和音。人必須學習詩經的字、音、義和語法來和其他人溝通。它不記載的字就音義無定了。所以才會「楚言而出[3]」。因此,方言的弊端在春秋時已明明白白了。







語言和文字是一個文明所有的思想、理想、精神、價值、氣質的載具,無論國界,超越時空。語言文字伸展文明,不僅超越政治邊界,並且超出了其軍事影響力。這就是為什麼魁北克和加拿大如此之近,但又如此之遠;和巴黎如此之遠,但又如此之近;新西蘭和英國在世界舞台有同樣的精神;美國人追逐英國,而不是丹麥或比利時王室的每一個細節。難道在美國的平民百姓和英皇有共同利益?原因很簡單,阻力最小的符號 – 同語同文 – 把英國人從仇家變成親家。

北京治下的臣民可能會想到很多海外華人不想作中國人。其實是人發現中國的符號已被壟斷砍斷 了,也很難認同這些被砍斷了的符號。他們放棄了。他們愛這個符號,但意識到他們不能參與這符號的將來,使之哀莫大于心死。他們拒絕了這不能參與其將來的符號,以維護符號所代表的一切。







[1] 1794年

[2] Alsace和Lorraine。 1870年普法戰爭



[5]論語:衛靈公: 30





August 4, 2014 Posted by | Current Events | Leave a comment

Lay Taxes To Those Not Buying Guns? NRA Must Be Grinning

John Roberts acknowledges that the Obamacare is unconstitutional in the commerce clause.  However, Roberts upholds the Obamacare because it is constitutional to lay taxes to those who do not buy health insurance.  So, using John Roberts formula, can the federal government lay taxes on those not buying guns? 

It seems like John Roberts’ formula is: if it is unconstitutional to X and it is constitutional to lay taxes to X, then it is constitutional.  Better yet, can the federal government impose taxes to finance the rendition program? Or lay taxes to finance the eaves dropping?  To impose taxes if you do not perform birth control?  To impose taxes if you do not perform abortion?  To impose taxes if you do not send your children to public school (this is already in practice)?  To impose taxes if you do not send your children to home school (this is not in practice)?

If John Roberts’ formula has to be supplemented by the general welfare clause, then not much difference it would make, as Richard A. Epstein (professor of law at New York University and a senior fellow at the Hoover Institution) suggests in NYTimes on 2012.06.29: Congress has the power to “lay and collect Taxes” only in order “to pay the Debts and provide for the common Defence and general Welfare of the United States.” The congress still can impose taxes if you do not buy guns since gun ownership contributes to the general welfare, if you agree that more guns around means we will have less criminals around.  The newer formula can still apply to anything the Congress sees fit. 

Isn’t the case that whenever something is unconstitutional to anyone element of the Constitution, then it is constitutional?  Benjamin Franklin said: “They who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety.”  John Roberts reversed (or the converse) the reasoning and we get a wonderful universal health care.  At what costs?

June 29, 2012 Posted by | activism, advocacy, america politics, Current Events, Democrats, opinion, politics, Regulation, Republican, Thoughts | , , | Leave a comment

Obamacare Makes Labor Market More Favorable To Small Businesses


Republicans champion capitalism, especially “the pursuit of happiness”.  For that, Republicans consider businessmen to be their safe constituents.  Is enabling small businesses to compete more effectively against the mega corporations something Republican look forward to?  Interestingly enough, Democrats are doing that this time instead of Republicans.  And that is through this Obamacare.

Extending health care to all is the idea of Obamacare.  Having this barrier to health care obviously gives an edge to someone.  In terms of politics (or policy), the question is always about who gets the advantage (or the disadvantage).  Prior the Obamacare days, the advantage is to the employers who can afford the administrative cost of providing a health care insurance to its employees, thus giving them an overwhelming advantage in recruiting and retaining the human resources they need.  This disadvantage suffocates small businesses and self employed.  Ultimately, innovation is sacrificed. 

Plenty of employees make employment decisions based on the health care package.  Many people give up their business dreams and stay as an employee because of the fear of not having health care for their families.  Almost everyone will be covered when Obamacare becomes effective.  Yes, the operating cost is higher for small business owners, however, this increase cost will draw the small business owners much closer to the advantage enjoyed by the mega corporations than if they acquire the health package alone.  In fact, only 38% offer health insurance to employees among the small business owners in 2009 versus 61% in 1993 (read here). 

If America’s small business owners’ talents for success are not willing to move to them and continue to stay in General Motors, ATT and like, then where is the next Google?

March 23, 2010 Posted by | activism, advocacy, america politics, Current Events, 美國, Democrats, economics, Election 2010, health care reform, nonprofits, obama, opinion, politics, Thoughts, US politics, wordpress-political-blogs | 1 Comment

Are These Obama Health Insurance Stocks’ Price Level Sustainable?

Shortly after Obama’s health care reform announcement on 2010.02.22 M, the health care industry stocks started to fall.  Even at closing, google still shows they are down.  However, health care insurance sector, such as Cigna (NYSE: CI http://www.cigna.com) and Aetna (NYSE: AET http://www.aetna.com), recovered very quickly and in factor closes better than yesterday 2010.02.19 F.  Who got the short straw in this latest round of Obamacare drama?  Why?  Didn’t Obama say job is his number one priority in the State of the Union?  Is this some kind of ideological fixation he has? 

If you need more information than CNN gives, then try this summary page.

The google health care index is down because the drug companies’, such as Merck (NYSE:MRK http://http://www.merck.com) and Johnson & Johnson (NYSE:JNJ http://www.jnj.com), stocks are falling.  Obama’s donut-hole fix will affect these drug companies’ financial performance.  On top of that, a lot of their patents are expiring. 

Health insurance companies are doing well because this round of reform is perceived to be creating demand for them.  Anti-discrimination is written in the announcement.  However, it is to “prohibit pre-existing condition exclusions, and prohibit discrimination in favor of highly compensated individuals” (the CNN does not say this.  You have to look it up from the summary link above).  In terms of “pre-existing condition”, that can translate to underwriting, i.e. if an applicant has to be accepted or not.  What it does not say is this: can the pricing of the same product be different to different individuals based on pre-existing condition?  Or based on zip code?  Based on county?  Based on race?  Which health condition is race related have you heard of lately?  Some explanation about “discrimination in favor of highly compensated individuals” is obviously needed. 

Obama knows health care reform did not work in the legislature.  He more likely than not knows his magic does not work on the Republican senators.  Does he believe his proposal will get some moderate Republicans?  If he wants to work getting moderate Republicans, then he would be work on them individually behind closed door.  And we will end up seeing a big announcement with some of these congressmen.  Instead, we see Obama’s proposal.  So, this is HIS proposal.  The other guys are missing.  So, he is making a political move to show to the electorate he has done his homework and tries to paint that the other guys are the real road blocks. 

Yes, they are.  And we have known it for a quite while.  And in fact, they have been encouraged by the voters to be road blocks.  Therefore, Obama better have planned a second move after Republicans’ predicted uncooperative stand.  If you truly believe that the Republican road blocks will not make Obama’s proposal work, then you should ask if these price levels sustain.

February 22, 2010 Posted by | Current Events, Election 2010, health care reform, obama, politics, US politics, wordpress-political-blogs | 1 Comment

What Do You Care About Greek Default? Or Andrew Jackson?

My employer has no business ties in Greece.  I have nothing Greek: no property in Greece, no mutual fund based in Greece, no IRA fund based in Greece, relatives in Greece.  So, what do I care about Greek?  You got to be kidding me.  Eh…. Do you care about the US recovery?

Greece is part of Euro.  A fiscal instability leads to the instability of Euro, or more precisely the depreciation of Euro.  Now, that is the beginning of problems.  First off, US exports get more expensive in the Euro land, i.e. the continental Europe that Rumsfeld called the Old World.  Euro’s depreciation is no good if it happens when US wants to export more.  But then, where can US export?  China?  Even when Chinese are buying Walmart products, how does that help US unemployment rate when those products were made in China to begin with?  Of the products that are US made, how many of them can be sold in China without violating either US embargo (regulated high tech products) or Chinese sanctions (produced by companies who sell arms to Taiwan)?  Do you think US can sell solar panels to China when China is the largest solar panel producer (by footage) in the world?  How many jobs can be produced in the US if Chinese eat more MacDonald’s?  It certainly gives a higher return for your pension funds, your 401k funds and IRA funds.  But jobs? No. 

Secondly, it is not a good idea when US wants to sell assets in Europe and the bring cash home.  It will either make the sale less appealing to the buyer if the seller wants it to be a US dollar deal, or it will make the sale less appealing to the seller if the buyer wants it to be a Euro deal. 

GM for sure will not be happy since they are selling SAAB.  Although the deal for SAAB is in US dollars, it certainly makes it more difficult for the buyer to finance the deal.  And if you have bought a house before, you may recall that the deal is often contingent on funding availability. 

Third, it certainly makes US assets more expensive to Euro investors.  NYSE (or NASDAQ) stocks are looking for more expensive to Euro investors now, although US and/or UK assets may have to become the safe harbors for the time being.  But they certainly are looking more expensive. 

The value of a currency (Euro or USD) has a great deal to do with the expectation how well that currency’s assets are.  The assets in Greece, i.e. Euro, are not looking good due to Greek fiscal policies.   A comparison of Greece in Euro land has been made to California.  While that may resemble somewhat in economics sense, I tend to think of this crisis as the early United States where the federal government was still responsible to foreign debts incurred during the Revolution War but all the states retained their rights to print currencies.  European Union has long been criticized as an elitist creation.  Voters mistrusted it in Ireland (2008), France (2005), Denmark (2000).  Urbanite/merchant Hamilton created the central bank to monopolize monetary power and ruralite/agrarian Andrew Jackson removed it.  As a result of multiple currency issuer and each currency has its own exchange rate (inevitably), interest rate, and ultimately credibility, the United States became worthless monetarily.  

The striking difference here is US were debating about the monopoly of monetary power whereas Europe already got their monopoly of monetary power.  Is this a lesson where Europeans have to reflect on their European federalism or a lesson where urban elitist (in the sense of Sarah Palin’s “East Coast Elites”) creations, European Union, never work?  The answer will prevail if Brussels elites managed to figure it.

February 11, 2010 Posted by | banking, Current Affairs, Current Events, politics, US politics, wordpress-political-blogs | Leave a comment

Did Obama Plagiarize Glass And Stegall?

Did Obama’s Volcker’s Rule announcement contribute to the drop of DJ?  Did Obama plagiarize Glass and Stegall?  Pundits all over the place say that is the result of the Volcker’s Rule.  One, Volcker’s Rule alone did not necessitate the fall.  Two, who among these pundits actually read what the White House press release, and not the Bloomberg announcement, is about?  Three, Volcker’s Rule is not “new”.  Volcker’s Rule is actually a re-tro.  Four and finally, what is the implication/impact (theoretical or academic) of Volcker’s Rule?  What can we learn from Geithner’s opposition to this Volcker’s Rule?

Yahoo (of all places) actually hit it right: there are plenty of reasons for DJ to fall.  Realizing the profits from Massachusetts Senator election is quite a good reason already.  In fact, the rise of DJ on Tuesday contradicts the fall of DJ on Thursday: DJ rose because the market expected that having 1 more Republican in the Senate would derail the agenda of Obama.  If investors believed in that, then the investors could not have believed Obama’s Volcker’s Rule would become law.  So, Volcker’s Rule alone did not create the fall.

The White House press release regarding Volcker’s Rule actually gives very little information.  And luck would have it that everything covered by Obama’s 01.21 announcement is already covered by H.R.4173 – Wall Street Reform and Consumer Protection Act of 2009.  Quite possibly, nothing is new. 

Worse, nothing is new: Glass-Steagall Act probably covered everything Volcker’s Rule is about.  Since Volcker’s Rule is not in the legislation form, no comparison can be done.  In fact even Volcker calls it “in the spirit” of Glass-Steagall Act.  It further proves that Obama named it Volcker’s Rule for political purposes: to show he is doing something to punish the bad guys (banks) for the rest of us. 

Preventing banks from having private equity funds, hedge funds et etc do decrease profits of the banks.  However, these funds make up 5% of revenues of Bank of America (NYSE: BAC), Citi (NYSE: C) and the like.  Yes, it does strengthen the point that this rule is for show, especially after the Massachusetts’ loss.  However, Volcker’s insistence on this issue has a point: it takes 5% of their revenue.  However, these banks are using depositors’ money to play these large bets, using FDIC’s insurance to back themselves up, and twisting their risk adjusted return on capital (RAROC).  Here is an example:  How much can $1000 bet if you were to trade on currencies?  Answer: with $1k, you can trade the equivalent of $100k of Japanese yen, British pound, Euro and so on.  If the currency fluctates 1%, the $1k is already gone.  If the market swings more than 1%, the bank has to lose all of its money (the $1k depositors’ money) and more.  So, these banks are misappropriating depositors’ money (which would be illegal in insurance laws), making taxpayers pay for their risk, and presenting themselves before the eyes of investors. 

What it really does is to draw out a lot of hot money from the market: less money will change hands on a daily basis.  That affects all industries.  Investors (institutional espeically) will have to play with real money, if this works.  Retail investors will make up a greater proportion of money in the market than before.  Market will be more difficult to be manipulated than before by a few players.  Will that shrink the whole market? Probably.  However (or hopefully), it will mean everyone will be trading with a saner head since no one will be playing with free money.

January 25, 2010 Posted by | banking, Current Events, Investment, legislation, market, Money, obama, opinion, Palin, politics, Thoughts, trading, US politics, wordpress-political-blogs | 3 Comments