Friday, November 21, 2014

Book Review 336: Zarafa

ZARAFA: A Giraffe’s True Story, from Deep in Africa to the Heart of Paris, by Michael Allin. 215 pages, illustrated. Walker

“Zarafa” is supposed to be one of those books bout a popular fad that either illuminates an age or provides a talented writer a launching point for extended but not necessarily tightly connected ruminations about a time. An Anna Nicole Smith for the 1830s, perhaps.

Unfortunately, the most that Michael Allin achieves is to be loosely connected.

The Romans imported hundreds, maybe thousands of giraffes to be slaughtered in the arenas, but for 1,500 years only a few more ever arrived. When Mohammed Ali decided to curry favor with France in 1826 with a gift giraffe, there had not been a live one in France for 350 years.

The cast of characters is promising -- various confidence artists, scientists, adventurers and the occasional writer like Stendhal, although Stendhal missed seeing the giraffe on his first attempt and Allin never bothers to say whether he made another. Nevertheless, Stendhal and the giraffe shared Paris for a while, so in he goes.

To say that “Zarafa” is unfocused is too kind. Nevertheless, we learn this and that about giraffes and one giraffe in particular. It is hardly worth the effort, especially since the book contains a number of niggling errors.

The strangest thing we learn -- by omission, since Allin never addresses it -- is that while the giraffe was a sensation, at least as much as the first pandas were in the United States, and charming and beloved by all, the French never gave her a name.

Zarafa was not her name, it is the Arabic for giraffe.

While "Zarafa" is not a good book for adults, I notice that it has inspired about half a dozen children's books since it was published in 1999.

The people's bankers

From time to time, I repeat a post from my commercial blog, Kamaaina Loan, here. Like now.

I would add that it is time to break up the big banks. It won't hurt. We won't run out of money. When the government broke up Standard Oil, we didn't run out of oil.

Here is the Kamaaina Loan post:

It has been 80 years since the Pecora hearings exposed how big banks work against the public interest. New Deal regulations limited some of the worst depredations and, most importantly, initiated the longest period in history without a financial panic.
Since 1980, the trend has been to regulate less and less, or not at all. In 2008 the country realized the benefits of that policy with a giant crash.
This week the Senate held a hearing on “regulatory capture,” which means the regulators get too cozy with the banks. The New York Times headlined:

New York Fed Chief Faces Withering Criticism at Senate Hearing

So that even what restraints on banks’ antisocial practices remain in law are nullified. One way that happens is through “revolving door” hiring of former regulators by banks they used to oversee, with expectable bad outcomes.
Pawn shops are regulated, too, but there is no revolving door between America’s 12,000 pawn shops and federal and state regulatory agencies.
Just sayin’.
Pawnbrokers are the people’s bankers.
#mauipawn #mauigold

Thursday, November 20, 2014


Off and on over the years, I have considerd writing a piece about the weird stuff that happens in state legislatures. I've never done it, in part because each January the Associated Press always provides a roundup of the sillier legislation passed in the "laboratories of democracy" during the previous year.

That misses such escapades as the Great Ramp Kidnapping in the North Carolina General Assembly, a story RtO may retell someday, but not today.

Another reason I have not done the story is that, although the state assemblies are loaded with some of the loopier citizens of this so-called great republic, for the most part, the assemblies themselves are not quite so crazy. It is harder to find a whole assembly of kooks than to find individual kooks in it.

Still, when a kook rises to speaker, that seems worth noting. Thanks to Wonkette, I became aware of the new leader of the House Republicans in Nevada, who will probably become speaker in January. His name is Ira Hansen, and he is a piece of work.

The Reno News & Review summarizes Hansen's outlook:

one of the most contentious public officials in the state. Hansen doesn’t like blacks, gays, Israel, many Republicans, and most Nevadans—he once wrote that newcomers to the state, who constitute four of every five Nevadans, should accept Nevada as it is or leave.
He revealed this over many years of columns in a Sparks newspaper. Since he often repeated columns, he cannot very well say now that he misspoke, or wrote in haste. Not that he seems likely to take up these favorite excuses when Republicans are -- as they so often are -- accused of deep racism.

Another Sparks newspaper opinionator -- I am guessing, not a Republican, says:

“Alas and alack, I believe Ira is an overt bigot, racist and homophobe. … The Barbwire never forgets, and I’ve got the evidence in Ira’s own words, which I will be publishing as the legislative session approaches. Can achieving high office and political power change the leopard’s spots? I hope so …”
RtO hopes not. We would be poorer for losing an authentic voice of the people. Some people, anyway.

Saturday, November 15, 2014

Trust me, I'm an unregulated market

While the big banks were busy cheating their customers by rigging the forex (foreign exchange) markets, somebody was taking them for a billion smackeroos the old-fashioned way.

Bernie Madoff would be proud. And envious. He had to pay Manhattan business lease rents and maintain the semblance of a real business. Much easier to set up a cyber bucket shop and milk the rubes of all their bitcoins and other digital money.
In May and June last year, Mandal and his wife, Wasima, 37, also a physician, invested $30,000 each with Secure, which required customers to use U.S. dollars. The Mandals swapped pounds for $60,000, using a bank. Following instructions from Secure, they then wired the money to banks in Australia and Cyprus to open their accounts.
Logging into the company’s website regularly, they watched as Secure traded the dollar versus the euro. Secure’s website showed that their accounts had soared in value to a total of $245,000 -- a fourfold increase -- in just 10 months.
Mandal says he decided to withdraw some money in March. In an e-mailed response, Secure said he’d have to wait. It cited issues with the U.S. Foreign Account Tax Compliance Act, which is a Treasury Department rule that applies to U.S. citizens using foreign accounts -- a law that was irrelevant to Mandal, who’s a U.K. citizen. The March 5 e-mail said Mandal would get the money in a few days.
Both these stories are from Bloomberg, which I prefer as a source of crime, er, business news because it goes into so much more detail.

Other than that, not much has changed since I first subscribed to The Wall Street Journal in 1971 (after reading my father's copies sometimes when I was a wee tyke). I soon learned that the most interesting part of the Journal was page 4, where the crime stories ran.

While the daily paper in Norfolk, Virginia, where I then worked, would give play to a stickup of a cab driver that netted $60, day after day the WSJ reported on financial crimes that netted tens, often hundreds of millions of dollars.

And the thieves would seldom go to prison for these heists. If they did, it was 24 months in Danbury (the country club masquerading as a federal lockup for business criminals), while the mugger who stuck up the cabbie would do 5 hard in a state hellhole.

Not too long before I became the business editor at the paper, a couple of upstanding local businessmen who ran a shipyard were convicted of bribing their way into Navy contracts. It was a surprise (not that they were crooks, that they were convicted) and the retiring business editor, Artie Henderson, was stunned when a judge sentenced them to a shortish term in the pen.

"Why put men of that class in prison?" Artie wailed. "Because they are thieves," I said.

He didn't say another word but he was not persuaded. He ate lunch with those guys at the Civitan. Moose, Elks, Rotary, Lions etc. and surely prisons were not made for his friends.

(I had a lot of respect for Artie. As a vet back from World War II he had gotten elected to the Portsmouth City Council and fought a lonely -- eventually successful -- campaign to allow veteran housing in the city, something the country clubbers who had run the town didn't want. But by the time I knew him, Artie was tired and sick and beaten down.

(After his Civitan lunches, he would sleep at his desk, mouth open. Once one of the photographers took a picture of his gaping mouth and taped a print of it on the ceiling over Artie's head. Artie was humiliated. None of the young guys in the newsroom, except me, knew about Artie's brave career. And none of them ever did half what Artie did for his town.)


Wednesday, November 12, 2014

Our ships just came in -- or did they?

Pasha's MV Jean Anne, modern and mysterious
Wall St. just loves Matson's purchase of the Alaska business of Horizon Lines, and -- presumably -- is OK with Pasha's purchase of the Hawaii operations of Horizon.

Matson's share price was up over 20%, making it a $1.5 billion company, up from a $1B company when it split from A&B. (A&B is now a $2B company, up from $1B at the split, so there.)

Pasha's increased presence in Hawaii can hardly be good for Matson, but what does Wall Street know? Not much in my experience.

What about Pasha's value? You'd have to ask George and I don't think he'd tell you. My impression is that Pasha is one of the biggest businesses in the country if not in the world, but it is privately held (apparently mostly by the Pasha family), so there's one in the eye for those who argue that the financial markets benefit us all by using collective knowledge to allocate capital in the best way.

This is been a load of complete barnyard waste since capital markets first started functioning in a modern way about 400 years ago but the financial marketeers never tire of telling that to us, and lots of people believe them. It is only stating the obvious to say it's bunk.

Usually the evidence is negative -- markets collude to destroy people, work, environments, cultures, nations, you name it. But sometimes the evidence is positive -- when those rare managers who know what they are doing build their businesses without resorting to the "discipline" of the markets.

This appears to be the case with Pasha, as with a few other big, very successful firms, like Cargill, Lykes (until its presiding genius got old and blew his capital on a harebrained corn farm in the jungle) and others you have barely heard of because whatever they do (making money is only one aspect), they don't think it's any of your business.

And it isn't although maybe it should be. Living on islands that require marine shippers, it is not a matter of indifference who is running the ships and how.

RtO has nothing against Matson (RtO owns a chunk of Matson stock it bought at a very favorable price, thank you) or Pasha but remains wary.

Tuesday, November 11, 2014

Talkin' hospital blues

 I prefer to restate the obvious, but sometimes if no one else will make the first move, I feel I have to do it myself. But until  last night, it was always on the blog. Last night for the first time, I testified at a public meeting.

The House Health Committee held a public hearing on the deteriorating financial situation at the hospital. About a hundred people spoke.

Some spoke of the future and some of the present. Only one person spoke of the history of the crisis. Here is what I had to say about that. I have the impression the legislators didn't like it much:

Good evening. My name is Harry Eagar. I am retired now, but for 25 years I was the business reporter at The Maui News. I am going to give you a history lesson and an ethics lesson.

In the early ‘90s Maui Memorial was throwing off substantial surpluses. It needed to reinvest this cash in new medical technologies and expansion to deal with a growing residential and visitor population. It was prevented by an Oahu-centric Legislature that looted this surplus to support deficits at state hospitals in places like Lanai and Kona.

Ethically this was unjustifiable. Hawaii is an island state with several remote, rural localities. It was not the place of the customers of Maui Memorial alone to cover the deficits of the rural hospitals. All of us in the islands are an ohana, and it is the duty of all of us who are more favorably situated to help provide basic public services like roads, schools and hospitals in places where local revenues cannot cover the whole expense. That is, the ethical course would have been to cover the shortfalls from the general fund.

It is easy to understand why the Oahu legislators did not do this. Using the general fund would have meant less money for them to spend on projects in their local areas.

The decision was not only unethical. It was stupid management.

By starving Maui Memorial, it weakened our hospital and eventually eliminated the surpluses that supported the small hospitals. Now you need to find money to support all the hospitals.

The answer is not the fantasy of Dr. Kwon’s so-called free private hospital. Building that would have completed the ruin of Maui Memorial, but there was a service never intended to be provided by Kwon’s project: mental health care.

Again, it would be unethical to deprive a whole island of hospital mental health services. And you have now learned, from the disgust at the closure of Molokini Unit, how unhappy the voters would have been to have learned that Kwon had eliminated mental health hospital care on Maui.

I am skeptical of the prospects of a public-private partnership as a rescue for Maui Memorial. We can easily guess what the private partner would want to do: recommend shutting down unremunerative segments of care. Like hospital mental health services.

For patients, it would be as bad in the long run as a private hospital, it would just take a few years longer for the disaster to occur.

The time is now to cough up the hundreds of millions that were untimely drained from Maui Memorial and take the steps that ought to have been taken two decades ago.

It will probably require new taxes, which I know can be found; and new backbones, which I am less certain of.