saft

Saft on Wealth: Sitting out Europe's rodeo


By James SaftOct 13 (Reuters) - Here is something every wealth manager thinking about betting big on Europe should consider:Ask yourself, do you have special insight into euro zone politics, or do you just feel lucky?Because in the end, this thing is not going to be about economics, or even about the art of the possible, it will be about will, envy, aspiration and caprice.If you as a manager think you can add value by guessing at imponderables, by figuring out exactly what the euro project is worth to its countries, then by all means, advise your clients to take a big bet.For us mortals, the best course by far is a slight underweight, with care taken not to lose money in obvious risky bets like financials and the bonds of struggling euro zone nations.The irony is that this means you are taking a bit of a pass on the biggest question in financial markets today. If Europe is somehow able to reconcile itself to a mutually agreeable bail out of its weak nations and a credible recapitalization of its banks, well then shares will soar.We’ve seen hints of this every time authorities there announce a new resolution, no matter how vague, to “fix” the problems.Or Europe can end very badly in any number of ways: a fracture of the weak from the strong, an inability to come to political terms over who pays or simply a crisis brought on by a market panic that happens too quickly for policy-makers to cope.Since the stakes are so high it is very tempting to take a strong position. We can be tempted by very low valuations and the chance of big gains or we can panic in the face of very high uncertainty and decide to just get out. It’s also hard not to want to appear decisive to others, especially if they are paying you for advice.Europe’s difficulties, though, are tremendously complex and are essentially about political risk, which is many orders of magnitude more difficult to measure and play then the other sorts of calculations investors usually make.One of the secrets of investing is the importance of humility and a proper respect for uncertainty. It’s a good bet this is a lesson a lot of people are soon going to learn, yet again.DON’T JUST DO SOMETHING, STAND THEREThat’s not to say I don’t think I have a line on how things in the euro zone are going to work out, or at least the very real limitations to the spectrum of outcomes.The facts on the ground are not encouraging. For the euro to survive as is, Europe needs to give new powers to the ECB and its nations need to cede much individual control over fiscal policy to the whole. Doing that democratically in short order is going to be difficult.As well, Europe’s banks need massive amounts of new capital, the impact of which is going to keep a very low ceiling on economic growth for several years. Even if you believe all of that, acting as if it were 100 percent true is extremely risky.The other issue, to be frank, is pain attribution. European assets will, obviously, get hit hardest if Europe falls apart or if it sticks together in a way that is negative for investors. U.S. assets will get hit too.The reaction of investors to those two types of losses, however, we be entirely different. If you have a client long Europe and Europe falls apart, her reaction will likely be “Why on earth did you have me messing around over there?”But if the US market gets hit by euro fallout, as well they will, the reaction will be more sanguine. Investors will feel more the way they do when struck by a natural disaster. Bad luck, but what are you going to do?This is a correct, if instinctual, read by wealthy investors. While diversification is good, and getting out of Europe entirely would be foolish, taking on extra risk in a foreign currency must be approached cautiously. If you are going to live in the U.S., as domestic clients do and will, you are pretty much stuck with having most of your exposure concentrated at home, for better or worse.The idea that globalization means that investors can float free of their home markets is a fantasy, as most Greeks will tell you.It is an easy call for U.S. investors to sit out Europe’s rodeo because they can’t manage the political risks.Unfortunately, the same underlying causes of Europe’s political difficulties - too much debt and slow growth - are also causing political risk to become a big feature in U.S. investing. Think about the U.S. debt downgrade and near government shutdown.Investors are ultimately going to have to learn how to cope.


Es gibt keinen Gott mehr... (WIR SIND SUPERHELDEN! ☆ Let's Play Garry's Mod: TTT)
  • *Maudado tötet Manu obwohl dieser ihn zuvor gerettet hat*
  • ...
  • Manu:Ja aber wenn du stirbst dann landest du in der Hölle deswegen.
  • O-Saft:Maudado ist jetzt kein Gott mehr, Maudado ist jetzt einfach der Teufel.
  • Delay:Oh Gott, das ist schon 'ne harte-
  • O-Saft:"Oh Gott", ja aber es gibt keinen Gott mehr, Delay. Es gibt nurnoch den Teufel.
  • Maudado:"Gemeinsam vereint im Tod"
  • O-Saft:"Das nehm ich dir jetzt persönlich das du mich getötet hast"
  • Maudado:"Aber jetzt sind wir vereint"
  • O-Saft:"Ja vielleicht wollte ich das gar nicht. Du hast mich nicht mal nach meiner Meinung gefragt"
  • Wie süß die beiden doch sind.

Final final, I promise. For a while, anyway.

Black- and redcurrants being made into saft, which is kind of juice, kind of squash, kind of cordial. It’s just the berries + sugar being cooked for a while, then they’re drained in a very fine sieve, and boom! fantastic antioxidant-filled drink that you mix with water.