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Back from Japan so lets do some catching up! July 10, 2016
Marc’s Notes:
Money Matters shows posted for your listening and downloading at Moneymanagementradio.com. Next show is July 21, Thursday, noon Pacific Standard Time, or on this website or KVMR.ORG.
Want to meet with me about inheritance, money management, the markets, bonds, retirement or just have questions? Email me at mcuniberti@cambridgesecure.com.
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Brexit
Wikipedia defines the Euro currency as the official currency of the Eurozone, of which 19 of the 28 member states of the Euro Union belong. Recent news has covered the so called “Brexit” where the British people voted 52% to 48 % to leave the common currency agreement.
Global stock markets immediately illustrated the surprising move by Britain by falling radically in concert in the days following the announcement. The vote is not actually binding and Parliament could elect to ignore the will of the people and stay in the Euro. A renegotiation between Britain and Euro authorities might take place to try and reach a more palatable outcome rather than an outright exit or even another vote may be in the cards given the gravity of the situation. An actual Brexit will take about 2 years to implement.
Only time will tell if Britain actually becomes the first nation to leave the common currency but if it does, it may signal the beginning of the end for the Euro. The more likely outcome however would be a shuffling of the existing members and a rework of the rules to better address the issues that may have led to Brexit in the first place and to prevent other nations from following suit.
At issue is the inherent problem of a common currency being used for differing economies. One could argue the only example of a common monetary representation in history is the use and acknowledgment of gold as a common unit of measure but the Euro is the first example in modern history of this type of concept being implemented with a paper currency.
The problem with a common currency is that each participating nation is inherently different then the next. Each nation has its unique levels of debt, trade levels, deficiencies, advantages and subsequent fiscal policies to handle such uniqueness.
Even the authorities that handle such policies and the people that make those decisions differ from country to country and therein lies the many problems.
One nation may have a strong balance sheet and a responsible fiscal administration while the next may border on fiscal irresponsibility. One nation might overspend while the next runs a balanced budget. In a world where each nation has its own currency, such differences in economies are addressed by each nations ability to borrow money in the public markets and how readily lenders are to pony up their money for government IOU’s.
Simply put, the more irresponsible the country, the harder it is for them to borrow and the more they have to pay in interest to do so.
In a common currency situation however, such as the one we have with the Euro, the ability to borrow is centralized and equal. Being a common currency, the rules are the same for everyone. To grasp the concept of problem, imagine a group of people with differing credit scores all being allowed to borrow on the same terms and at the same rates. Some would cry foul while others would reap the benefits.
Such is the issue with the Euro.
Economically responsible nations are crying foul for having to pick up the tab for their overspending brethren. Overspending nations want to renege or renegotiate their debts by pulling out of the Euro and pay what they owe using their own currency obviously made easier made by using their own printing presses. Running the printing presses is far easier than pay back what they currently owe in Euros, a currency which they cannot print themselves.
The ramifications of the Brexit and unknown but no doubt serious. Should Britain set the example of how a nation could possible take an easier route of addressing their massive debt levels by simply leaving the Euro, other nations could eventually do the same. If enough nations leave, this could shake the whole concept of the Euro to its core.
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Turning Japanese
We just got back from the tiny island nation of Japan, a trip we undertook so my kids could visit their relatives and learn about the heritage. It was a great experience for them and us.
Japan's economy has dodged a recession after it grew faster than expected in the first quarter of the year. (www.bbc.com/news/business-36319420).
Indeed when I was there I was amazed as to how vibrant the malls and centers were.
The systems there were amazing and one wonders how they lost the war.
Indeed when I was there I was amazed as to how vibrant the malls and centers were. The systems there were amazing and one wonders how they lost the war.
In the next few issues I will be enlightening you as to what I saw. If you have never been, I highly recommend going.
The first thing I noticed (as I did during my first trip there in 2001) is that Japan is the cleanest nation on earth. There was absolutely no garbage or litter anywhere. There were also few trash cans to be found, a fact I found inconvenient. Nonetheless there was no trash to be seen. I was told the Japanese pack out what they use and the threat of terrorism and trash can bombs cemented the no trash can ideology.
The bathrooms were immaculate everywhere including the public places like at national monuments, amusement parks and airports. A welcome sight! The toilets are super sophisticated. See below. Some toilets salute you with opening lids when you enter. The various buttons and such need little explaining. Needless to say my kids marveled at Japanese toilet workings! And note how clean this was in the international Japanese Airport to boot. Never in America, not today, nope.
Speaking of weird machinations in Japan, all the good food gave me the most beautiful legs..........................................( yea I know, weird eh? As is the author of this news letter!)
The Japanese also have some weird customs. Their karaoke is done in private rooms and they pay per hour. Here is my son Kyle trying to comprehend it all with his Uncle making a fool of himself, well not really. It was pretty cool and soon they were all doing it! Even Dad sang "Rock and Roll Hoochie Koo" for the first time since doing it for real on stage more than 35 years ago! (Holy cow, I feel 30 years old, AM I THAT OLD NOW??) Since I only did back up to the main man I really never was a singer and still am not! My son Dominic looks on.......
We were asked to pose for a Pepsi commercial promo where they were making a collage of people drinking the newest edition of a super carbonated, super caffeinated version called Pepsi Strong 5.0. We also got free bottles for participating. Them Japanese are indeed a bit odd at times~
They have a lot of cars, drinks, food and more in versions we don’t see here in the US.
7/11 also is a bank in Japan.
And how about the worlds best massage chairs?
Japan has them and my boys found them!
The chairs do your hands too (note their hands in the sleeves) and your feet. They ROCK! We sat in them for free on 3 different days and they were heaven!
We found some food very cheap compared to the US. One buck for a Sushi plate of two pieces. Here is my son after eating 25 plates. That’s about 50 pieces. Total bill - $25.00. They also don’t do tips in Japan so your food bill is just the food! That same bill in the US would have likely been easily over $100. Kyle looks pretty full and he was. In some restaurants we got a black plastic card when done which were electronic checks instead of paper ones. They indeed have some very cool systems! Here is some monster Tempura Shrimp we got in some out of the way place in some out of the way town we went for a day spa experience. Wow! Even my sister in law had not seen shrimp this large in Tokyo!
Here is my foray into weird Sushi with my son Kyle and his cousin. Raw chicken Sushi. Took a few visits to get up the courage to try it and it was pretty damn good. I also tried raw horse. Whoa. Hey, when in Rome…….. The horse is pictured below...
Very good as well. They had whale but I declined. How about this below! That is a cracker! That is not a photo but actual smashed octopus under a press with rice to make a cracker and that octopus you see is the ACTUAL octopus smashed but it retains its shape. It looks like a photo but it is NOT. And its a pretty damn good cracker as well! My sister in law is thrilled!
This is a Japanese-Chinese foot fish massage. Tiny little Piranha like fish eat the dead skin off your feet. It tickles like hell. I didn't try it but did see one person do it. The calluses on his feet were completely gone! Unfortunately so were three toes.
There is more to share but I will say enough for today as I still have lots of catch up to do. I was however watching the markets during the Brexit and sent an email to all current clients detailing my take on the whole thing and letting them know I was on it!
Email me if you would like this kind of personal attention to your finances!
All the best and stay tune for more soon!
Jambo!
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PS:
My son Kyle (pictured above at our table with and Senator Ted Gains) is working for a car and college tuition. He coats decks, sands them, pressure washes them and preserves them saving thousands in potential weather damage. He works hard and does it for a fraction of the cost. SAVE THOSE COSTLY DECKS AND STAIRS from the weather, even wood benches and flower boxes! Give me a call or email me. (530) 272-5042 or mcuniberti@cambridgesecure.com. He also does odd jobs or will just help you! He is a 4.14 GPA student who plays varsity sports and sings choir. He also does painting but only first stories. NO extended ladder work.
If need a deck repaired or replaced, Kyle has the gracious services of a carpenter who can do all the deck work while using Kyle as an apprentice. The labor rate for this gracious gentlemen is $30/ hr. and Kyle helps him for $15/ hr so the total rate for BOTH of them is ONLY $45 while most carpenters charge $75 to $125/hr. for just ONE person!
So get your deck or carpentry done for a lot LESS!
Note the finish below on the railing after power washing and sanding then applying the top coat. (An uncoated section is the deck floor to the right side of the photo)
Give me a call or email me to talk to him directly to see if he can help you around the house with anything or do some painting or deck coating.
I am also looking for some bids on the SECOND story of my house to paint. Contact me!
All for now,
Marc
