In Search of the Perfect Investment

Sort of depressing to return to Kennedy, one of our biggest airports. And get stuck in slow crawling traffic. Especially after the splendid roads in Spain.

Of course, they spent too much on infrastructure. And we spend too little.

Spain’s bonds need bailing out.

Ours do too, but we can print money. They can’t.

We’re into QE3 big time. The big words are quantitative easing. The smaller words are printing money. Mr. Bernanke had said he will buy $35 to $40 billion of bonds for as long as necessary to keep interest rates low and (he believes) get more people employed.

This “logic” rests on three bad assumptions:

1. Low interest rates cause banks to lend more and companies to borrow more and hence employ more.

2. Printing money won’t cause inflation, which is harmful. It will.

3. Quantitative Easing works. It’s been tried twice before. So the third time will work! This is the classic definition of stupidity — doing the same thing again and expecting a different result.

QE also hurts the lives of people who live on their savings. Here we call them retired people. Over there they call them pensioners. I’m proud to be a pensioner. I got into the Madrid Botannical Gardens for free.

Is Bernanke printing money to keep his boss in a job? Of course. The banks give his campaign oodles.

It’s sad we don’t use Bernanke’s money to fix our infrastructure. We could start with that road into town from New York’s Kennedy airport. Of course, that would require Congress. Good luck.

There are strikes in Greece and Spain this morning. Who can blame them? More than one in two of the kids under 30 in both places don’t have jobs and are probably living with their parents. The streets are more interesting, mor fun than being nagged by mum to get a job.

I have no idea how to get them a job. Maybe they could open the stores more often? It’s not easy to shop in Spain. Even restaurants are closed at lunchtime. Perhaps some of the kids could go to cooking school? Spanish food is awful. Unless you can really love olives and olive oil at every meal.

The world’s economy is not doing well. This chart is depressing:

Business Insider comments:

The chart comes from Morgan Stanley’s latest Strategy Forum deck, and though it’s simple, we suspect a lot of people haven’t seen it yet, or really haven’t made the connection between the chart and other big economic stories of the day.

This is the chart that’s causing warnings from FedEx.

This is the chart that’s contributed to the collapse of the Shanghai Composite.

This is the why the Baltic Dry Index is down 60% this year.

It’s why US manufacturing indices are giving off the weakest signs of the economy.

If the US goes into a recession in the next year, this will almost certainly be why.

Time to find some more shorts.

Bad press on Apple regarding its maps will depress the stock some more.

This fall will provide a “buying opportunity” but not quite yet.

More Harry Travel tips:

1. You can get money out of ATMs in Europe, but you need infinite patience and multiple cards, along with new PIN numbers which they only send you in the mail… and that takes 10 days. Good news: I received all my PINs yesterday — after I’d returned. Good planning, Harry!

Some cards charge for taking money out. Some don’t. My AMEX card becomes a debit card when I use it at an ATM. Amex takes the money directly out of my bank account. Apparently, this is free, part of the Platinum service. With some cards, you can get big surprises (also called huge fees). Check before you go. Some cards also charge 3% on overseas transactions. Some mess with the exchange rate. I think Amex is the best.

2. I can’t wax strongly enough about the two MiFi gadgets I took with me — a Verizon one and a XcomGlobal. Both worked in the most unlikely places — like traveling at 150 MPH on the train between Seville and Madrid. Despite WiFi being freely available in Europe now (except on the trains) you must carry one of these gadgets. More on them tomorrow.

3. For bargain airlines, check the web site of the airport you’re traveling to. You won’t find bargain airlines on Kayak, Expedia or Orbitz.

4. The Kindle — any model — is a pleasure to travel with. I suspect the new $119 Kindle Paperwhite might be the way to go. Better screen, better battery and built-in light. I haven’t tried it yet. But will.

5. Skype on your smartphone on your hotel’s WiFI is the cheapest way to talk to the kids back home — if they’re answering their phones (which they’re usually not).

6. Sleep, sun and time are the only cures for jet lag, especially flying west.

Harry Newton who is really happy to be back. I played tennis yesterday afternoon. I bought the biggest, rarest, most disgusting cheeseburger for dinner last night. It was great. And it didn’t contain olives or olive oil.