Tuesday, 31 May 2011
Capitulation is the point at which a bear market has a massive sell-off - at that point, with no more sellers left, the buyers take over and an upward trend resumes. However, this is only after heavy losses as been sustained.
Sadly, after 3 years of fantastic returns, the curse has struck my trading portfolio this year - with a nice dose of hubris too. I heavily invested in Xcite energy after the de-risking of a successful drill, only to see the market hugely mark down its potential - from 360 down to 167 - over 50%. A big reaction, too much, but AIM has it problems at the moment with liquidity. EMED too has fallen over 50% from year highs as news flow has been too slow for the market to accept there is real progress. CAZA's failure with a big exploratory drill has seen it 66% off its year highs. Even GKP, which has put out strings of good news, is some 25% lower that its high.
Overall 33% down of the year thus far, at the depths of last year, when my portfolio ended 115% up again, the loss was only 20% - this year I will be glad to get into profit at all. it is quite possible, with EMED likely to double or more and a recovery of some sort in XEL likely to see me near break-even. In reality, I am 50% down from year highs, which is considerably more in cash terms than I earn in my day job - a little sobering to say the least. (Lesson [painfully] Learnt - take profits and de-risk ahead of key news statements on event driven stocks)
Coming up later in the year, a possible GKP takeover after their oil contract row is settled and a make of break drill for XTR in the North Sea.
Logically speaking the absurdum should have been evident for some while, by attending to the 'run-rate' of investment required to achieve the demented 'green' plans we are 'legally' committed to. (Mercifully this commitment relates only to UK law, and we are still a sovereign nation ... I think.) When I first started banging on about this (5 years ago) the run-rate was as follows: we needed to invest in new electricity infra- structure with sustained annual expenditures around 50% higher than we had ever managed before. When I last did the sums, about a year ago, the run-rate was that we needed to be spending at double the historical highest (every year for a long time ahead).
Now just as with limited-overs cricket, you can always do the arithmetic and derive a run-rate. But when you need to score a boundary off every ball, you know the game is up. And when not even sixes will do the trick and you need to contemplate overthrows on every ball ...
We are, by any reckoning, nearly there - with or without the Green Investment Bank and its puny £3 billion to spend.
The symptoms are all around. Germany is going to scrap all its existing nukes ahead of their time (and Alex Salmond has completely flipped). France has banned drilling for shale gas. The NIMBY anti-onshore-wind movement is really getting up a head of steam, particularly in Wales. Last year, global emissions rose to record levels as inefficient developing-world manufacturing displaces efficient western output. Try today's Grauniad for a measure of green angst (this Monbiot article and the hundreds of comments), and a characteristically lurid Rowson cartoon.
Yes, Honest George Monbiot says it well.
"We don't like nuclear power. We don't like onshore wind. We won't like the costs of the other technologies. We reject all the means by which electricity is generated. Yet no one is volunteering to stop using it."
When Crapper Huhne finally gets the boot, could this not be the moment finally to confront reality ?
Monday, 30 May 2011
Father Ed answered brightly “Hello? Maggie Island parochial house. Father Ed Milly speaking. ...” but suddenly his face turned from a smile to fear.
“Ahh! Bishop Brendan,” he trembled, “how nice to hear from you..”
“MIIIILLLLIIIIIYYYY!” Roared Bishop Brendon, the head of the Transcendence Universal Communion. “What’s this I hear about you abandoning spending commitments?” he screamed down the phone at the hapless Father Ed Milly.
“Oh..hullo Bishop. Well..erm..I was..well..that is ..I wasn’t abandoning profligacy..I was ..just erm, ..
“Milliy," Do you know why we ordained you ?”
“Erm..because I was the best man for the job?”
Back in his opulent union office Bishop Brendan sighed and leaned back into his golden chair. A unison steward refilled his champagne glass. As he sipped the Cristal he said, “No Milly. Myself and the Episcopacy of associated public sector clergy decided you were the best man for the job... because we thought you’d be as malleable as your rubber face. Now I want you to get out and say “No! No to cuts!" And then promise a payrise of 18% to all Labour supporters ... erm..I mean..valuable frontline workers.”
“But Bren'... the voters..They aren’t sure that outrageous spending is the answer to debt. They..they..think a more balanced approach..”
“Milly,” hissed Bishop Brendon slowly, “Two things. Firstly, I demand that you get out there and start a campaign of lavish fiscal commitments in key marginals . I want posters put up showing broken incubators overlaid with a picture of laughing Tory bankers and weeping ethnic nurses. I want billboards promising a new regional development hub for every village. A sure start centre for every hamlet. And I want them all up tomorrow. 10 x 10."
"And secondly..If you ever call me Bren' again I'll remove your adenoids with a toasting fork and use them for communion wafers, understand?"
“Good..And I want a slogan, Milly. A catchy slogan that people will remember and will be able to be recited by all the drones in your shadow pulpit without sounding as false as an MP’s expense claim. Oh..And that last one... If your new slogan isn’t a huge improvement you’ll find my Tory-Led boot up your arse! Don’t make me leave my nice post at the Transcendence Universal Communion to have to pay you a visit. Or I’ll be performing laying on of hands... Around your throat. Is that clear?” and he rang off without waiting for his answer.
“Have another glass of milk Ed.” The young acolyte, Father Kevin McGuire, was trying to comfort his mentor Father Ed Milly.
“He’s much better now, thank you Father, " said Mrs Eagles, the housekeeper, “He’s got his knees apart a bit now and he’s managed to take his hands away from covering his genitals. "
“He had an awful fright, Mrs Eagles. It was Bishop Bren' on the phone.”
Ed Milly let out a little whimper of fright and crossed himself.
Mrs Eagles leaned over to whisper in McGuire’s ear.
“Bishop Brendon you mean?”
“Oh for sure it was. Bren' bawled at Father Ed for a good long while. It was like the old Wacky Races show with the General on the phone..” and Father McGuire did his laughing Mutley impression. “Father Ed went completely white. It was like the time he told the Bishop he was thinking of performing civil partnerships. Bren’ fell on him like a fire extinguisher at a demo. Left him crying like a Clegg.”
“I’m fine now, thank you Kevin. It was just ..that Bishop Brendan.. he can be very mean. But what are we going to do? I’ve promised the congregation a different path. A new beginning. Labour: The Next Resurrection. Rising from the dead after being crucified in the elections and buried under a boulder of incompetence. Its my ‘big plan.’ But all the old Bishops want is “Tax and spend! Tax and spend.”
“Tax! Spend! Save the world! Obama beach!” cried Father Jock from his chair.
“Oh you’re still awake Father?... I thought that book on ‘The Crash’ would have made you nod off. It did for everyone else. Well, Father Jock, have you any ideas? “
The old priest stirred. He sat up. His milky eye blazed..
“Pie!” Fathers Maguire and Milly looked at each other puzzled.
“Pie! Pie! PIE!..Pie!” he said shaking his arms up and down like in a chant.
“I think he’s turned into Eric Pickles,” said McGuire.
They ignored Father Jock’s mumblings and went up to bed.
“Lets sleep on it. Both of us have a really good long think, OK?” said Milly sleepily. But all Ed heard was snores from the other bed.
“How about...This for a relaunch slogan. “Macroeconomic Endogenous Growth Theory in Equality Britain’s Umbrella Diversification Community Inclusion?”
“You forgot partnership. And its not as easy as 'Big Society' is on the tongue. Although it does make about as much sense.”
“Its no good Kevin,” said Milly. “Its just gibberish. Only an activist would read past the first line...What have you got?”
Father Kevin McGuire passed over a sheet of paper to Ed Milly. He smiled broadly.
Father Ed took the paper. He stared at it. He turned it over. He looked at Father Kevin.
“Its blank,” he said. “Its a blank piece of paper.”
“I know,” beamed Father Kevin. “It’s great isn’t it?”
“Yeah. I spent all night thinking, And finally I thought of this,” chirped Kevin cheerfully. “I didn’t imagine It would be this good. Wow!”
“I don’t understand. This is your idea. It isn’t anything..its nothing!”
“Aww come on now, Ed. Its not nothing..its anything. You get people to write on it what they want to have. And then you tell them that's what they've got.”
“But Kevin. That’s a really, really..stupid idea. I mean if I said to a lawyer in Sheffield what do you want they’d say childcare and tax breaks. But to a union shop steward in a factory, they’d say higher wages and...Oh my Lord, its brilliant!..Its brilliant Kevin. You’re a genius!”
“Well..I’m no John Prescott, but its a winner. I got the idea when I looked in the bathroom mirror and saw a great big blank puppy face staring back at me. Who couldn’t love that?”
“But what about the slogan.. something that would allow us to sort of say we’re not spending like Cherie Blair at a property auction, whilst convincing Bren’ that we are blowing wads like the best double deficit days of Father Jock.”
“Tax! Tax! Spend..Pie..pie..pie!” yelled out Father Jock.
“He’s doing the Pie thing again, Ed. I think he’s intoxicated.”
“Well he’s certainly toxic anyways. Wait a minute Kevin,..that’s not pie he’s saying” realised Father Ed."Its ....FI.........P-F-I..of course! Off balance sheet debt creation. Completely hidden from view. We can run up billions and billions and still claim we haven’t spent a penny. Public Investment in the Economy. PIE. That's our slogan.
"Help yourself to another slice of PIE."
We’re saved! Mrs Eagles, put on the kettle! New Labour is back!”
Father Ed Part 1 -
Father Ed Pt 2
Saturday, 28 May 2011
...Just then the housekeeper Mrs Eagles arrived with a big plate of commitments....
“Would you like a bit of a spending now Father?” she asked
“No, Mrs. Eagle." replied Father Ed Miliy, "We’re not having any more spending commitments just now. We’re all full of spending our way out of debt for the moment.”
“Are you sure Father?" she enquired. "Old Father Jock used to love a good splurge. Morning, noon and night he'd be a spending. Do you know he used to get up at 4am, just to get a few extra billion spent before breakfast? Will you not just have a little bit of extra benefits to single mothers?”
“No, I’m quite all right thank you.”
“How about a lovely big IT project?.. The last NHS one was only £15 billion.Here’s one for schools. It’s got plenty of jam on it for our favoured contractors.”
“Mrs Eagle. No. I’m fine”
“Ahh, Father Ed..come on now. What about a bank? A nice juicy bank bailout?..Go on.
“No Mrs Eagle...We don’t want any more unsustainable spending. Its making people sick. Sick of us. ”
“Ahh, that’s a shame Father,” conceded Mrs Eagles disappointedly. “I’ve a couple of Battleship contracts for key Scots Labour constituencies that are going off in the fridge? Are you sure you won’t have a bit of a blow out?”
Father Ed shook his head.
“ ...No? ...Ok-So, I’ll be taking Father Jock out for his walk then. We’re going past that new Maggie Island International Bank. He loves that.”
“I didn’t know Maggie Island had a new bank? ”
“Yes, in the down town financial district. It’s the ‘Rio-Novosibirsk-Mumbai- Xīnběi’ local bank. Father Jock is very taken with place.
“I love my BRICs” bellowed the old priest, waving his tartan kebbie.
“I’ll get some spray for his chair too,” she said wrinkling her nose at it. “It does pong quite a bit. Smells of feet. Or maybe its defeat. Anyway, it needs a good scrub. Come along Father,” and she wheeled the old priest away.
"Right Kevin. We've work to do. Touring Maggie Island telling everyone how lean and responsible we're going to be in the future. No more selling off the gold chalice & crucifix. No more trebling the loans on the poor box. We're going to let the islanders know we're very different people now. Even if we are in fact, the same clergy as before, just with different jobs. I'm going to arrange for some media coverage. Lets get this new message on the road."
A week later Father Ed and Father McGuire were sitting at their dining table. Father McGuire was making an Airfix model of the Battleship Potemkin, whilst Father Ed read the Sunday Parish magazines. He held up a headline.
“NO MORE MAD SPENDING” says top priest,’he said. "And look Kevin. There’s a picture of me wagging my finger at a plate of Euros. And look at this from the Daily Grail.
“FATHER ED’S DIET. ‘DON’T SQUEEZE MY MIDDLE.” And Kevin, here’s a picture of me talking to that fellah with the hover mower. How middle class is that?”
“Oh yes. Remember, Ed. You got into an argument with him when he said he was a Protestant? He said he wanted to trim his hedge and you said he was doing it too fast and too deep. And he said if you don’t clear off he’d kick you in the bollocks.”
“He did get a bit prickly. I only said that if he trimmed the hedge maybe only 97% of what he was planning, it would look great. But if he did the whole 100%, it would die. Erm. Kevin..You’ve got a plastic funnel stuck up your nose. Isn’t it great though Kevin? This is going to be a big success. I can feel myself being a contender for the Maggie Island Father of the Year.”
“Yes, I think so Kevin.” And looking down modestly he added, ”I might also, be..you know..One day .. The Cardinal of Maggie Island.”
Father Jock suddenly awoke and let out a great laugh, pointed at Father Ed, laughed again even louder, belched..shouted something that sounded like ‘Feck’in wonk eejiit,’ farted and fell back to sleep in his chair.
“Well, anyway..” said Ed, somewhat deflated, “I didn’t mean now..maybe in a few years.” But then he clapped his hands in joy and brightened again. “ But for now Kevin, there’s nothing to do. Just feet up, have some tea, and watch a faith program on the BBC. One of those that tries to avoid any mention of religion at all. I think The Big Questions is coming from St Vince’s on Cable Island this week."
But as Father McGuire turned on the television and sat down happily to watch the telephone started ringing.
Father Ed answered brightly
“Hello? Maggie Island parochial house. Father Ed Milly speaking. ...” and suddenly his face turned from a smile to fear.
“Ahh! Bishop Brendan,” he trembled, “how nice to hear from you..”
Father Ed Part 1 -
The parochial house on the desolate wasteland that is Maggie Island.
Father Ed Milly, the leading Labour party cleric, is talking to his youthful acolyte, Father Kevin Maguire.
Father Ed is holding up a document, but young, blank faced, Kevin is having difficulty with Father Milly’s explanation.
“These council seat gains were small...But the next election.... is far away..”
“Ok,so, “ said Father McGuire, opening up his Daily mirror.. "I don’t know a thing about politics, but here on Maggie Island, in our own little bubble, we don’t need to.”
“Quite right. “ said Ed, “Let’s just sit back and relax and enjoy our time in opposition. Ahh! This is the life, eh, Kevin? No one asking you to do things, or come up with any “ideas” or dealing with any problems. Isn’t that so Father Jock?” he asked the repulsive old priest, who was dozing in retirement in his rotten, whiskey stained and mars bar crumbed chair.
The sleeping priest of high finance suddenly awoke with a splutter
“Wha..Redistribute!..Tax!..Spend!” Yelled the former cleric of Maggie Island.
“No Father..We’re in opposition now. We’re taking it easy. No more taxing and spending..”
“Tax! Dividing lines! Feck over the Tories...”
“Oh, you shouldn’t have woken him Ed. I’ll get the dartboard.“
Father McGuire set up a dartboard a few feet in front of Father Jock. The old priest pulled out a paint ball gun from beside his chair and fired a magazine off into the grinning picture of Tony Blair stapled over the board. He slumped back in his seat drooling and mumbling about record tractor production.
“We’ve got to get a grip Kevin. No more reckless splurging of the money supply. We’ve got to go on a diet. Get a little leaner. I suggest we give up something..like you know, for lent..”
“Well Ed”, said Father McGuire, “I’ve been looking at our poll ratings for Scotland . They’re not very fat. In fact we’ve lost quite a bit of weight up there.”
“All right Kevin..Ok..”
“A good few million pounds lost there in donations I would have thought. "added McGuire helpfully.
“ALL Right! I know. It’s not good. We did well elsewhere though..” Milly caught sight of Father Kevin’s slightly surprised and doubting face and hurried on..”I mean..well enough..for a bit.. But We need to make ourselves more appealing "
“Like Father Burnham and his make-up?”
“No. Not like that. We need to be more..sort of..statesman like. More responsible. Make ourselves more popular with the congregation. "
“Like Father O’Bama He’s popular. And he’s going on a spending cut. Apparently ‘there’s no money left.’
“Oh that’s right. But I think It was Father Dick Byrne who said that. It’s the right idea though. The flock don’t like the idea of the people getting free houses and free lunches and jobs for life..and golden pensions ...and, only working a day a week..and so on...”
“Like us Ed? ”
“Ermm..well..sort of..I suppose, ..but the focus groups say the people don’t like the idea of us not having to face reality.”
Father Ed stared into Father Kevin’s smiley, innocent, toddler face.” Mind you..you have never faced reality, have you Kevin?”
“I have Ed! " said the priest indignantly.
“Now Father..Let's recall..You still keep your crunchy nut cornflakes under your pillow in case the Thatcher Snatcher gets them.”
“Ok, fair enough. But one day you’ll be sorry you didn’t do the same, Ed. Remember when all the milk went missing, Ed? And you said you didn’t drink it..And I didn’t and neither did Mrs Eagles or Father Jock?"
“True. But there was an explanation. That big fat cat sitting on the kitchen table licking his lips.”
“Okay, so.” Conceded Kevin.”Whatever happened to that old fat cat, Ed?”
“Bob Diamond? He got an even better job I think. But let’s sort out what we’re going to give up for electability..err..I mean..give up for lent.”
“Well. I’m sure I can cut out a bit of the old lying. In the Daily Mirror. I’m doing far too much of that anyway,” said McGuire.
“Good idea. And I will cut out first class rail travel. Or at least, I’ll change the seat covers so it looks like I have. But what about Father Jock. What are you going to give up Father?” Asked Ed to the spiteful old priest.
“What about cutting back on the old Nokias Father?”..
”Well maybe not,” said Ed, ducking as another phone whizzed over his head. “How about just giving up going to parliament?..Ok? That’s what you can do. So that's us all sorted. A complete spending freeze. No new announcements like laptops for every Christian or lagging all the lofts on Maggie Island. Just a little bit of a snoozey quiet time. Put on the telly Kevin. FLOG IT! is on. I love that show. Lets see which bit of the NHS Andrew Lansley is flogging off today."
But as they sat down to watch, the housekeeper, Mrs Eagles, arrived with a great big plate piled high with union demands and a steaming pot of commitments....