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8:30 AM EST Friday, January 26, 2007: It's Australia Day. In 1788 Captain Arthur Phillip arrived at Sydney Cove and set up the Colony of New South Wales. That's what they're celebrating today, with fireworks and beer.


England established the Colony in order to offload its petty criminals (it hung the real ones). These days, 219 years later, it's fashionable to be descended from convicts. Sadly, that's not my situation. My parents fled the Nazis in 1939, arriving in Sydney nine days before the outbreak of World War II. Australia is the only country that has sent troops to every War America has fought in since 1914.

India and the commodities: Michael is in India, says everywhere he looks is booming. He thinks commodities' demand stays high. My commodities expert believes high prices are a result more of real consumption demand than of hedge fund speculation. He emails me:

Noted the commentary in your blog today and sympathize with your agony. For whatever it's worth, let me add that Doug's team has build a rather powerful model to analyze commodity price development (you know, of course, how we feel about predicting the commodity universe with regard to prices) and applying the EAFE Sharp Ratio over 1-year trailing period, the US$-Index over 1-year trailing period plus Roll-Yield over the past 18 months (ending 6 months ago) provides a pretty strong predictor at 0.48R². For 2007, this model is showing commodity returns at 27% plus/minus 11%. From a more fundamental standpoint, I’d throw out the high correlation between TAP and global GDP of 0.60. Unless you are thinking negative global GDP for the next 12 months, commodities ought to appreciate even if global growth will be more moderate in ’07 than prior years. That’s it from the data & research farm.

If I understood all that, I'd feel proud. Personally, I'm still mulling the whole commodities thing. Even if we reverse some of last year's losses -- 41% in energy, 15% in foods and fibers (cotton, sugar and coffee) and 9% in livestock (live cattle, lean hogs, and feeder cattle) -- it would do OK for this year. Theoretically, my 2.5% of my portfolio in commodities remains an uncorrected hedge against my (greater) investments in the stockmarket and in commercial real estate -- which continues to perform spectacularly, for reasons that escape me.

A reader called Don (I won't tell you his last name) emails:

Perfection in trading and investment doesn´t exist. As in poker, it´s a matter of odds and probabilities. And cutting losses short. But you know all that. Hey, my (commodities) returns sucked last year too.

I went to the energy dinner hosted by MIT last night, and the striking thing was the composition of the audience. No top guys from Shell or BP in evidence. But Silicon Valley packing the room. The tech crowd included Vint Cerf, Vinod Khosla, John Doerr, Larry Page, Chad Hurley ... and Sergey Brin came late. So full that even Page and Hurley had trouble getting in. Topics: nanobatteries, solar, natural selection and biofuel bugs, transmission grids.

It was all the more interesting because it was pretty much our leader of November 18th, "Green Dreams", come to life. We said then that:

California's entrepreneurs are piling into clean-energy technology ... Displays of excessive enthusiasm for particular new technologies often end in tears ... Some investors are sure to see their shirts blown away in the wind.

Nice shirts, too.

And maybe we'll bump into the board of Exxon at a dinner on next-generation social networking.

There are inflation fears: The Fed remains worried about inflation -- so much so, says the Wall Street Journal, that the Fed is likely to hold interest rates, even if the economy slows. It's hard for me to get worried about inflation, with oil down and the cost of technology plummeting. I'm perusing the latest catalog from TigerDirect.com, one of my favorite technology retailers. The prices are insane: a 42" Panasonic HD plasma TV for $1280, a Toshiba 62" HD DLP projection TV for $1900, Acer, Lenovo and Toshiba laptops for under $1000, 19" Viewsonic monitors for $220. And yesterday I bought a 5-port Netgear Ethernet hub for $24.

Any tips on the IRS? Those wonderful people insist they don't have my wife's 2004 tax return. We file jointly. Since they have mine, they have hers. We have sent xeroxes of the return at least three times. But they keep losing it or whatever. Anyone know any keys to the IRS's filing system, or better, lack of a filing system? They threaten all sorts of horrible and nasty penalties if they don't have the return. And I'm getting to the point of wondering if there's anything I can do to solve their filing problem. They're the reason the column is late this morning. They made a "courtesy" call to me this morning and harassed me for 20 boring minutes.

The Australian Tennis Open 2007 is on. I'm engrossed in the matches. One is better than the previous one. Here's the remaining schedule. All times are EST. The tennis is a sound reason to buy a TiVo recorder.

Friday, January 26
3:00 pm - 6:00 am - - ESPN2
9:30 pm - 11:30 pm -- ESPN2

Sunday, January 28
3:30 am - 6:30 am - Final - ESPN2 (Live)
12:00 pm - 3:00 pm - Final - ESPN2

Who knows if any of these are true. But they're certainly fun. Airlines exchanges

Tower : "Delta 351, you have traffic at 10 o'clock, 6 miles!"
Delta 351: "Give us another hint! We have digital watches!"

Tower: "TWA 2341, for noise abatement turn right 45 Degrees."
TWA 2341: "Center, we are at 35,000 feet. How much noise can we make up here?"
Tower: "Sir, have you ever heard the noise a 747 makes when it hits a 727?"

From an unknown aircraft waiting in a very long takeoff queue: "I'm f...ing bored!"
Ground Traffic Control: "Last aircraft transmitting, identify yourself immediately!"
Unknown aircraft: "I said I was f...ing bored, not f...ing stupid!"

O'Hare Approach Control to a 747: "United 329 heavy, your traffic is a Fokker, one o'clock, three miles, Eastbound."
United 329: "Approach, I've always wanted to say this.. I've got the little Fokker in sight."

A student became lost during a solo cross-country flight. While attempting to locate the aircraft on radar, ATC asked, "What was your last known position?"
Student: "When I was number one for takeoff."

A DC-10 had come in a little hot and thus had an exceedingly long roll out after touching down.
San Jose Tower Noted: "American 751, make a hard right turn at the end of the runway, if you are able. If you are not able, take the Guadeloupe exit off Highway 101, make a right at the lights and return to the airport."

A Pan Am 727 flight, waiting for start clearance in Munich , swears he heard the following:
Lufthansa (in German): " Ground, what is our start clearance time?"
Ground (in English): "If you want an answer you must speak in English."
Lufthansa (in English): "I am a German, flying a German airplane, in Germany . Why must I speak English?"
Unknown voice from another plane (in a beautiful British accent): "Because you lost the bloody war!"

Tower: "Eastern 702, cleared for takeoff, contact Departure on frequency 124.7"
Eastern 702: "Tower, Eastern 702 switching to Departure. By the way, after we lifted off we saw some kind of dead animal on the far end of the runway."
Tower: "Continental 635, cleared for takeoff behind Eastern 702, contact Departure on frequency 124.7. Did you copy that report from Eastern 702?"
BR Continental 635: "Continental 635, cleared for takeoff, roger; and yes, we copied Eastern ... we've already notified our caterers."

One day the pilot of a Cherokee 180 was told by the tower to hold short of the active runway while a DC-8 landed. The DC-8 landed, rolled out, turned around, and taxied back past the Cherokee. Some quick-witted comedian in the DC-8 crew got on the radio and said, "What a cute little plane. Did you make it all by yourself?"
The Cherokee pilot, not about to let the insult go by, came back with a real zinger: "I made it out of DC-8 parts. Another landing like yours and I'll have enough parts for another one."

The German air controllers at Frankfurt Airport are renowned as a short-tempered lot. They not only expect one to know one's gate parking location, but how to get there without any assistance from them. So it was with some amusement that we (a Pan Am 747) listened to the following exchange between Frankfurt ground control and a British Airways 747, call sign Speedbird 206.
Speedbird 206: "Frankfurt , Speedbird 206! clear of active runway."
Ground: "Speedbird 206. Taxi to gate Alpha One-Seven."
The BA 747 pulled onto the main taxiway and slowed to a stop.
Ground: "Speedbird, do you not know where you are going?"
Speedbird 206: "Stand by, Ground, I'm looking up our gate location now."!
Ground (with quite arrogant impatience): "Speedbird 206, have you not been to Frankfurt before?"
Speedbird 206 (coolly): "Yes, twice in 1944, but it was dark, -- And I didn't land."

While taxiing at London 's Gatwick Airport , the crew of a US Air flight departing for Ft. Lauderdale made a wrong turn and came nose to nose with a United 727. An irate female ground controller lashed out at the US Air crew, screaming: "US Air 2771, where the hell are you going? I told you to turn right onto Charlie taxiway! You turned right on Delta! Stop right there. I know it's difficult for you to tell the difference between C and D, but get it right!"

Continuing her rage to the embarrassed crew, she was now shouting hysterically: "God! Now you've screwed everything up! It'll take forever to sort this out! You stay right there and don't move till I tell you to! You can expect progressive taxi instructions in about half an hour, and I want you to go exactly where I tell you, when I tell you, and how I tell you! You got that, US Air 2771?"

"Yes, ma'am," the humbled crew responded.

Naturally, the ground control communications frequency fell terribly silent after the verbal bashing of US Air 2771. Nobody wanted to chance engaging the irate ground controller in her current state of mind. Tension in every cockpit out around Gatwick was definitely running high.

Just then an unknown pilot broke the silence and keyed his microphone, asking: "Wasn't I married to you once?"

This column is about my personal search for the perfect investment. I don't give investment advice. For that you have to be registered with regulatory authorities, which I am not. I am a reporter and an investor. I make my daily column -- Monday through Friday -- freely available for three reasons: Writing is good for sorting things out in my brain. Second, the column is research for a book I'm writing called "In Search of the Perfect Investment." Third, I encourage my readers to send me their ideas, concerns and experiences. That way we can all learn together. My email address is . You can't click on my email address. You have to re-type it . This protects me from software scanning the Internet for email addresses to spam. I have no role in choosing the Google ads. Thus I cannot endorse any, though some look mighty interesting. If you click on a link, Google may send me money. Please note I'm not suggesting you do. That money, if there is any, may help pay Claire's law school tuition. Read more about Google AdSense, click here and here.
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