A Tribute To Another Blogger

The view from our room here in Lima, Peru at 8:00 PM

We are in Lima, Peru, my wife is visiting relatives and friends, and I am here mostly on bearing business.  I am always sympathetic and supportive of other fringe bloggers slaving away to put their thoughts out there for anyone in the world interested enough to read...  One blog I have run into lately is by a Mr. Smith, who shares certain (superficial at least) things with me: he writes a non-commercial blog, is married to a no-nonsense foreign lady and writes whatever he feels like.  Mostly it is a daily account of his personal life.  I invite you to take a look:

http://www.angrysinner.blogspot.kr/

I like it because it is deeply personal and he not afraid to use strong language (eg, "filthy atheist" is my favorite of his terms).  There are a number of differences between us however.  He is a macho man living in Korea with his Dragon Lady, and unlike us, they have two young Children of the Rice (we have one grown daughter).  Korea is an interesting country.

So, today, in sincere honor of Smith´s blog I will depart from my customary writing style and write about my day today.  Nothing special.  Skip this if you want, I don´t care.

***

I woke up at 8:30 AM, happy that my brief bout of "Atahualpa´s Revenge" had passed.  I ate a small but careful breakfast so as not to re-invite trouble.  I then walked across our in-law´s Peruvian style compound to work, where I sat through a meeting I could only partly understand.  The meeting was about different pressures (collecting money, making deliveries with our limited manpower and fleet, divisions of responsabilities, teaching one of our younger guys how to better work with customers, etc.).  I said very little, as those matters are beyond my scope.

I enjoyed a cup of coffee and [hygiene details deleted].

I then examined our upcoming proposed purchase from Iljin (one of our two Korean bearing suppliers), and found it OK.  I took a boring photo of our upcoming export shipment to our customer in Costa Rica (a pallet of bearings and hub & bearing assemblies), hey, The Economist magazine once called the bearing industry one of the world´s most boring industries, who am I to argue?

Since the computer was on anyway, I went to waste some time at some favorite websites (zerohedge.com, and more recently, bitcointalk.org).  Nothing new anywhere, same old stuff.

My wife went off to the "Mercado Indio" (Indian Market) to purchase gifts.  I have already been to the Mercado Indio, there is little of interest for me there.

After work I walked to a nearby park and did my two Tai Chi forms.  I did not perform them well, as it has been eight days since I last did them.  Well too bad.  I needed the exercise.  At least there was hot water for the shower when I got back.

I ate a clean dinner and walked three blocks to Wong, the local supermarket to buy some juice, milk, and raspberries.  Here is a picture of tropical fruit for sale there:

Fruit uncommon in the USA, L - R middle row (below bananas): Carambola (Star Fruit) and  Mamey (olive green), and Maracuya lower right

All of the family has left to go see some movie in Spanish, which I passed on (something about a pregnant woman), but at least we have two more DVDs that Eleodoro (my wife´s father, 93 years old) likes (Combat!, the show I liked when I was a kid and that Eleo likes too).  Maybe tomorrow night we two can watch.another three or four episodes.

Taking another page from Smith´s blog is a song for you to enjoy.  I do not know why, but this song has been going through my head for several days.  Perhaps many of you will remember Jacques Cousteau and the wonder he brought us decades ago (this song I should arguably have put at the end of my last article about the book I reviewed: The Pillar to the Sky).  I hope you enjoy the song, I did.

"...Ay, Calypso, the places you´ve been to
The things that you´ve showed us
The stories you tell 
Ay, Calypso, I sing to your spirit,
The men who have served you so long and so well..."

(Click the link below if the image does not play the song)



https://www.youtube.com/watch?v=-ZonmQZG0GQ

God Bless.

Thinking About 2014

In my article today I wanted to crystallize various themes I have been thinking about, but had not yet solidified them, they have been "half-baked", but now I want to discuss several subjects that I will be thinking about and closely observing in the New Year about to come.

Gold and Diversification

I believe that I have reached a near optimum (for me and my family) holdings of gold.  Gold (physical in your own possession) of course is the single best piece of diversification for almost anyone.  It is a "different vector" (for my math-oriented friends), that runs orthogonal to most other investments.  Anyone who has read my blog already knows that I am a big fan of gold.  I will continue to be.  But, my forward investments in gold will be considerably lower now.

I would note for everyone that platinum has had a relatively decent run lately, now selling at about a 13% premium to gold.  This is a little high by very recent standards.  But, if the world economy improves, and barring a "Freegold Scenario", platinum might be worth a look.

I have taken a very small position in "junk silver", US dimes, quarters and half dollars minted in 1964 and earlier.  These coins are likely only familiar to those who are, say, 45 years and older.  Junk silver sells (retail) for about 16 times "face", so a dime would cost about $1.60 and a quarter about $4.00.  Here is a picture of the two junk silver purchase I recently made at my LCS (Local Coin Shop):

My LCS allows me to sift through his pails of junk silver, allowing me to pluck interesting coins.  In the above photo you can see two Walking Liberty Halves at the lower left, the one showing the "tails" side (the eagle on the ground) is dated 1918, but is not in good shape.  The two coins at the lower right are Standing Liberty Quarters (both sides displayed).  Also in the pile are Mercury Dimes (I saw lots of these when I was young, from 5 - 10 years old).  I took a few in good condition...  NONE of these coins, to my knowledge, as any significant numismatic (collector) value, although a few apparently are worth a little more than their silver content.

Why would I buy junk silver if I already own Silver Eagles?  "Survival Stuff", the above would be spare change...

Bitcoin

At some point relatively soon I will likely write up "Part Six" of my Bitcoin series.  I still am interested in this complex subject that does appear to have a realistic chance of "making a real difference" in the way the economy and/or our financial system works.

I still want to make a small gold purchase from amagimetals.com to have another Bitcoin for gold source.

I will also be doing experiments with BTC as well as staying in touch with some experts who have guided me in this realm.

I must mention that Andrew Hodel's fascinating website (http://fiatleak.com/) is back under his management again (although up for sale).  To this minute I have had it up for some 20 minutes, I just saw a 186 BTC transaction go by a few minutes ago, and one for almost 139 BTC (an impressive $107,000!) just went by, here take a look, the 139 BTC transaction is just "east of Brazil", you will definitely want to click on the image if you want to see that transaction...:

Note that China (at bottom, "CNY") is at zero (now anyway) BTC traded through the exchanges there.  China must be down (or their exchanges not sending the information to his site), as normally China is exchanging a lot of BTC as well.

Energy

The USA is approaching "energy independence", a long established goal for many Administrations.  The main reason is the new technologies now being used in so many places (horizontal drilling, fracking, 3-D seismic, deep water drilling).

One important thought is that many of the "shale oil" plays deplete quickly.  So, whatever oil is produced by the many wells being drilled will deplete, and that will mean to keep production up there will have to be many more wells drilled into productive oil plays.

Note that there are big oil shale deposits in China, Russia, Argentina and even places like Poland.

Bullish on oil service companies, fishez?

"White Swans"

The Mainstream Media continues to assert that things really are getting better, even this weekend's issue of Barron's is pretty much the same (their Cover Story about housing likely to go up some 5% per year and bullish columns by most of their many writers).

I have been "bearish" for so long I almost forget what it is like to be optimistic.  Fortunately for me, I have NEVER had 100% conviction in my predictions (that is, I have held stocks, even though selling them off bit-by-bit for decades).  So I have been a little able to see some of the stock market's gains of about 26% in 2013.

I must now acknowledge the prospect that the "bulls" have been and may continue to be right.  If so, then US stocks will continue to be a good place to be.  As would be US real estate (residential perhaps more so than commercial, but, hey, what do I know?).

I think that we have, however, reached a point that US long-dated Treasuries may be a bad bet.  The 10-Year Note is at a bit over 3.00%.  The "Taper" will likely not be good for bonds.

Geopolitics

I continue to believe that our main overseas rivals (China and Russia) will be less of a problem than growling bear sources like Zero Hedge and Jim Willie posit.

China has huge problems (demographics, environmental problems, mal-investments, HUGE debts, etc.) that many are unaware of or do not discuss in depth.  A well-informed observer in and of China is Michael Pettis, whom "Mish" quotes from time-to-time at his blog (globaleconomicanalysis.blogspot.com).

Russia also (like Japan) has a declining population.  Yes, they have huge resources and are currently on a roll.  But, with the corruption and the overall tendency of Russia to be totalitarian, I do not think that Russia will "surpass the USA", no way.

There really are no other BIG PLAYERS out there in the world who can challenge the stability of our country.  Malicious attacks that could cause real damage, yes.  Bring us down, no.

Only a bumbling USA that continues to lose its way can bring our country down.  Unfortunately that is a real risk, as our country is so divided into Taxpayers and the "FSA" (Free Stuff Army, using the more gentle word).

US Politics / The "Taper" / Obamacare / NSA

Continuing the theme from just above, I am pessimistic about the overall leadership (and especially the financial leadership) at the top.

Barron's columnist Jim McTague summed up my feelings rather nicely in this weekend's edition.  He predicts a LOT MORE partisan strife (with the occasional can-kicking as needed) in 2014.  Obama is a polarizing figure, not the unifier he painted himself out to be...

I have no idea what will happen in the November 2014 elections.  I *guess* that I would be happier if the R-Team scores big and takes the Senate.  That would mean less damage would be inflicted upon us by the Socialist Democrats.  But, I do not think there is much of a difference them, some, but not much...

The Obamacare juggernaught marches on...  Obama & Co. are trying to minimize some affects (most on their own suckers, err, supporters) by delaying implementation of The Personal Mandate (as, um, the healthcare.gov site continues to not work right, but I recently read that just $50 million more will fix it, they promise!), among other "fixes".

The whole NSA scandals seems to be getting bigger and badder by the day.  In a thread just today (Sunday, December 29), Zero Hedge reveals even more disturbing evidence that the NSA has devices and malware that can capture data on hard drives, you know, like in YOUR computer.  They have a 50-page catalog of devices and technologies, see article: http://www.zerohedge.com/news/2013-12-29/nsas-50-page-catalog-back-door-penetration-techniques-revealed.  This is a real problem for US technology companies now..., what foreign companies or governments are going to trust US technology products?

Peru, Korea and some observations on other Emerging Markets

Our bearing sales in Peru for 2013 will come in at some 3% or so better than our big year 2012.  This is roughly in line with Peru's economic growth.  Peru is a dangerous place to invest in, but it is diversification for my family, we have trusted people there.  And Peru continues to actually grow...

Barron's had a column about which developing markets may show the best growth in 2014.  Korea is considered "emerging" (?) even though there GNP per capita exceeds that of the UK.  Apparently Korea's stock market has underperformed lately, and the declining Japanese Yen is hurting their competitiveness...  For example, Ameru believes that at least one of our Korean suppliers will raise prices on key products that we buy (especially our 2nd best selling piece).

As I hinted at above, I am not at all excited about the BRICs.  Brazil is full of corruption, cronyism in their build-out of the World Cup and Olympic infrastructure (a huge waste of money, but not for President Dilma Rousseff's friends!) and many other problems.  India?  Now they are trying to make it hard for their own citizens to import gold.  Does India now sound like a place where you would want to invest?

"Survival Stuff"

As many of you know, we live in a condo.  We are not well set up for a SHTF, not to mention a TEOTWAWKI...

I will be making what preparations seem reasonable based on the (low I hope) probabilities of a disaster that may come.  And I will be writing further on this general topic.

"You never know."

Spiritual Fitness

Perhaps a year or so ago, I wrote about becoming fit.  Fitness would help any of us in difficult times, I specifically discussed a few types of "fitness".

I continue on my own journey towards a more spiritually fit life.  I am not going to go into any details now (at the risk of boring or angering some of you).  But, I am happy with a path or two I have been on.  I have many to thank who have helped me along this new trail...  In particular I would like to thank the below:

John M
Jay
Lewis
John R
Steve
and my wife...

for their continuing moral strength and support in helping me to become a better man.

Happy New Year to all of you!  Peace on Earth.

Brer Robert Takes On A Lefty!

I spend plenty of time (too much?) on the computer, and today I read an article that burned my butt!  This was so typical of the garbage that I see coming from (most of) the Hard Left that I felt forced to email the author with my critique (below) of his article.

Ron Jacobs wrote this article: www.counterpunch.org/2012/10/12/lessons-from-korea/, and it would perhaps be worthwhile to read it for proper context.  My critique of his article is pretty straightforward, so it is not necessary to read, but it would be better.

[begin critique]

Dear Sir,

I am American who works with my in-laws in Peru.  We import rolling bearings into Peru (I live here in America), most of them as replacement parts for cars and commercial vehicles there.  Most of our bearings come from South Korea.  In May, I went to visit our two main suppliers (comments on them at my blog, May 2012).

WOW, your article comes close to making N Korea the rough equivalent of S Korea by your hagiography of George Katsiaficas and his book, and your NOT mentioning at all the absolutely brutal regime, for decades, of the Kim Dynasty in North Korea!  Yes, there have been ugly characters with blood on their hands in S Korea's post WW-II history.  But, the uprisings in S Korea have been tolerated and, yes, suppressed with relatively little bloodshed.  ANYTHING similar in N Korea would have been bloodily crushed, and YOU know it.  Shame on you.

S Korea's GDP per capita exceeds that of the UK.  They have a fairly good democracy now.  

They also have very advanced manufacturing (eg, Samsung and Hyundai).  Their bearing plants (I visited four) were unlike anything I have ever seen, right out of Star Trek...  In one of the provincial plants, I noted that it was not the traditional "one man, one machine" so often seen at other bearing plants, but "one man/woman, 20 machines".  Yes, women on the (clean and safe) factory floor.  They need BRAINS not brawn at Jecheon...  N Korea exports weapons, fake money and drugs.  I also took note of the complete freedom in S Korea, the youth there are free to be as idle or involved in "Korea Pop" as they so choose.

I understand that CounterPunch is hard left (which is great, First Amendment and all), and perhaps you have to toe a line (I visit CP fairly often, but more as an observer from the libertarian right).  But, your leaving out the ALMOST INCREDIBLE achievements of the South Korean people, and yes, with the aid of the USA, is reprehensible.  N Koreans flee to S Korea, while N Korea has to kidnap people from Japan's shores to gain "skills" and "instructors" they need.  N Korea seeks the Nuke, counterfeits our money, regularly attacks (verbally and militarily) the South and is an active participant in the Asian drug trade.  How can you discuss the Koreas, even if just reviewing a book, without mentioning the most barbaric, the WORST place on earth: North Korea?  Have either you or Katsiaficas been to North Korea...?  Or even seen the clandestine photos taken by tourists (Google them)?

As we say at Zero Hedge (www.zerohedge.com, you can start YOUR re-education today): minus 1

I know you have to play for your audience, but shame on you for not letting your fellow "Progressives" know of the logical extreme of Socialism.  Such one-sided pieces are why the Left is in trouble here in the USA.  The rest of us call this: "Selective Lying".  That's the trouble with the Left, especially the Hard Left, lies are the main tool in your kit.  

May you progress in your thinking and in your knowledge.

Best,

Robert A. Mix

[end critique]

DMZ Tour and a bit more about Seoul

Alas, the DMZ half-day tour was something of a disappointment.  First, no Norks (that's only at the Panmunjon on full day tours)!  We only went to see Tunnel 3 (or as our over-caffeinated tour guide "Catherine" called it "Tunner 3"...) and the observation hill, where you can see the two flags (N & S) not far from each other.  So, yes, OK, I did see the NK "propaganda town" (where no one lives) and the stripped-bare mountains (firewood).

"Tunner 3" (I like her version better) was the third one the South Koreans found.  A defector told them it was near a certain landmark tree,  The SKs dug a few wells and pour water down them.  And when the NKs would set off dynamite to advance through the rock, water then blew out of one of them.  The Tunner encroached some 300 meters into SK.  The Norks then said it was a SK trick!  That SK dug the tunnels.  The SK engineers then pointed out that the holes where the dynamite blew could ONLY have come from the north.  Then the Norks said they were mining coal...  And put coal dust over the granite...  Pretty lame, guys...  And they want a nuke...

At the observation post on the hill, you could only vaguely make out the North, partly because of haze, and partly due to the distance (the DMZ is 4 kms wide, and there is an inner fence which divides the DMZ into the approximately equal areas that the Norks and SKs patrol).

Turns out there IS another DMZ in the world, an Aussie on the tour mentioned to me that CYPRUS is still divided, so I was in error about there only being just one DMZ left.

The tour ended by NOT dropping me off at my hotel (where I was picked up).  They just dumped us near the city center.  I did not have my Seoul map with me, making a bad assumption that they would bring me back to where they picked me up.  Lesson learned: When in a city I do not know well, ALWAYS bring my map (or "BMFM" to you cognoscenti).

I shared a nice laugh with the late night crew at Z Chat, I mistakenly wrote DMA rather than DMZ, then someone else said either was better than the DMV...  Well, I thought it was funny.

***

I mentioned our over-caffeinated tour guide.  Well, considering that all four men here in Korea with whom I worked with (that I had extended conversations with) work 60 or more hours per week, I guess they need it...  There are PLENTY of young people (etc.) who only put in their 40 hours, but they are not the ones who will wind up running the show.

Seoul is over-saturated with coffee shops, both ones we know well in the USA and lots of their own chains as well.  LOTS of coffee houses, with people doing their thing on their Samsung/Android smart phones.  It's even worse among the young here in Korea than in the US, if you can imagine that.

This is the only city I can think of where it is MUCH easier to get coffee than beer, and even harder to get booze!

Seoul, Korea

Today I finished the last of my meetings with our bearing suppliers.  Due to strict security, I was not allowed to take pictures inside the factories, so I will just comment on Seoul alone tonight, I will have separate articles soon on KBC and Iljin, our two top bearing suppliers (both Korean).

Seoul is a huge city, the population of Seoul is around 16,000,000 people.  By comparison, the METRO areas of NYC and Los Angeles are both around 20 million and Chicagoland is about 10 million.  The first three pictures I took entering the city from Incheon Airport.  The first one shows the first of the skyscrapers I saw, there are tall buildings everywhere in Seoul...

Mile after mile after mile:

after mile after mile (the river is called the Big River):

The view from my hotel in the Gangnam-Gu area (first night):

After spending a night each in Kyungju and Changwon I arrived back in Seoul last night.  I took the below pictures today, the first is in central Seoul, "almost" a pedestrian mall like in Europe:

The below picture I took of a booth (with a cross in red) sponsoring Christianity here in Korea.  You would have to look very hard to see the "666" business written there, evidently there are people here who do not like "Goldman Sachs 666" either (you know, CEO Lloyd Blankfein saying he's just doing "God's Work" after all...).  But, I remained a moment, and the tiny lady in front of the booth (just to the right in a white coat) began to sing.  She sang beautifully...  I recognized the song, but she was singing in Korean.  I thought and I thought, but it would not come to me...  She sang like an angel.  After I walked on, it came to me: "Amazing Grace".  I walked back and gave her a contribution.  She made my day!  Ma'am, I do not know who you are, but at least I have a picture for the world to see you.

Later, I dropped by a place serving Guinness on tap, Happy Hour!  The kind waiter took the picture of me with my beer and the munchies they gave me (Korean vegetables, they eat LOTS of vegetables over here).  And, yes, I am beginning to learn how to eat with chopsticks...

***

I wish to thank my two main hosts here in Korea (pictures of them and their assistants in other articles coming soon), Juno Yoon (Iljin) and Sung-Su Kim (KBC).

Kahm-S'Ahm-Ni-Da, my two great friends in Korea!

Jecheon, Kyungju, Changwon and Seoul

I will have much more write about my Korea (and later Japan) later, when I have some time to compile my notes & comments and see what pictures I can get get up here on my blog.

Overly briefly, I saw the most advanced factory (at Jecheon) I have ever seen (bearings anyway, I have never been to a semiconductor plant...), robots everywhere...  LOTS more machines than workers.  Absolutely incredible.  And the other factories I visited were EXCELLENT facilities too.

I'm telling you guys, America is not going to catch these guys unless things change fast, else, stick a fork in it, we will LOSE our manufacturing bit by bit as hungry Asians (60 hour weeks by EVERY white-collar guy I spoke with)...  These guys are serious people, not wasting time on Facebook or trying to be web designers or working for obstructionist government...  Korea's government WANTS manufacturing, and it is clean, they fish in their rivers in Changwon, a big-time manufacturing city.  Changwon was MUCH cleaner than an equivalent American manufacturing town.

Korea has good food!  Strange but good!  I have gained weight...  In Kyungju, my hosts treated me to Korean barbecue... In Changwon, we went to a real hole in the wall, ancient-style place for fish soup yesterday.

I need dinner as I write, I promise a BIG ARTICLE on this and related topics as soon as possible (rare-earths too, veyron!).  Some pictures, but they would NOT let me take pictures inside the plants, apparently NO ONE who owns technology wants to let their competitors see how they do what they do.

[Note to my ZeroHedge readers, I have a great idea I am thinking about writing as a contributor...]

O/T, but no (or VERY few) iPhones are here, ALL Samsung phones w/ Android.  Mr. Kim helped me check some stocks on his Samsung there at Changwon airport 3 hours ago...  CAREFUL w/ Apple, yes, they are doing great in the USA (and probably Europe and Lat Am), but Asia (Korea anyway, Samsung-land) likes Android.  I will study what JAPAN uses in a few days.

This has been the most interesting trip of my life in many ways, wow, oh wow.