German Vs. Greece Household Debt: Germany Has More

Be careful about your cultural stereotypes (source: Bloomberg).

For those who think we are out of the woods take note: The scale of bailouts is mushrooming. During the Asian financial crisis of 1997-1998, for instance, South Korea received $10 billion. But, after the rescues of Bear Sterns ($40 billion), Fannie Mae and Freddie Mace ($200 billion), AIG (up to $250 billion), the Troubled Asset Relief Program for banks ($700 billion), we now have the mother of all bailouts: the $1 trillion European Union-International Monetary Fund rescue of troubled eurozone members. A billion is a big number, too: a billion seconds ago it was 1959. A billion minutes ago Jesus was alive. A billion hours ago was the Stone Age. A billion days ago no-one walked on the earth on two feet. A billion pounds ago was only 13 hours and 12 minutes, or the rate the British government spending it (thank you adamsmith.org).

So where is all this heading I wonder? Governments that bailed out private firms now need .. bailouts. But what happens when the political willingness of Germany and other disciplined creditors - many now in emerging markets - to fund these bailouts fizzles? Who will then bail out governments that bailed out private banks? It starts looking increasingly like a Ponzi Scheme.

W/E

Sonnet and I have a most busy week end (she naps upstairs as I blog). From the Fun Run, we have our friends Tony and Susan over for dinner. Tony and I know each other through the investment business and share a keen interest in technology and venture capital, where he was a pioneer in the PC industry having founded one of America's first "value added" PC reselling and network integration businesses focusing on the corporate marketplace in '79. His company, MDS, ranked Number 9 in the Inc. 500 list of fastest growing privately held companies in the US. Sadly for us, they will leave London for Boston at the end of this year as Tony is involved with the Harvard's Kennedy School of Government. The thing about Tony - I always learn something from our exchanges may it be government, business or religion whose influence, he notes, is growing in every part of the world but Western Europe. What are the implications?

This morning, Sunday, Sonnet shakes the boy from a sound sleep for swim-practice while she runs a loop of Richmond Park. They race home so I can take Madeleine and him to an awards ceremony as his KPR Blues finished first in their division in the Surrey Youth Football League. We join several hundred kids and parents and, mercifully, the acknowledgments brief. Eitan is happy with his glass objet that he receives in recognition of his and the team's efforts. Next year they will compete in Division One and we shall see how they hold up.

From the awards, Shai and Ada join us with their children and we have a late lunch and relaxing afternoon. Shai is preparing his second clean-energy fund for Richard Branson which is keeping him busy. Like us, they bought a house this year and we joke about being the only 20-year renters on the planet. Better late then never, right? They are modernising a Victorian property in Chelsea - Shai says you can stand on the ground floor and look up to see the roof beams. There are five floors in between. The kids join us at the dinner table and we enjoy Sonnet's family-style macaroni pasta. We make paper airplanes but a trip to Richmond Park foiled by work and rain showers.

ASIC

The Fun Run starts at 10AM sharp and Sonnet on the grounds well beforehand to ensure everything tip-top for the 250 athletes. Eitan is determined (hell bent?) to be the first from his school to cross the finish line .. and he does, covering the 5.4 mile course in 41 minutes. Not bad. Madeleine places third for the girls -- wearing jeans and a double T-shirt. For whatever reason, she refuses to put on shorts or something appropriate for the warm weather and arrives, at the end, beat red. I love her for this. Meanwhile, on the school grounds, I and a motley crew of Dads fire up the industrial grill and flip burgers. We serve about 300 of them, complete with ketchup, mustard and "salad" which few people enjoy. Krispy Kreme donates sugar doughnuts. So much for the healthy morning.

Sonnet's Office

We are temporarily without Wi-Fi as the house rewired for, well, everything. This is rather bothersome for Sonnet who is helping organise tomorrow's annual five-mile "Fun Run" which is hosted by the school for .. fun. This requires getting Council permissions, sorting field marshals, securing an ambulance and First Aid, setting up water and food stations, bibs, runners, volunteers, timing and &c. She thought she was on work-leave. The Head Teacher will greet the runners at the finishing line with stop-watch to hand. Yours, truly, is responsible for the BBQ and I apply my adroit management skills to the task: my burger-flippers have their marching orders. It takes an army.

Motley Crew

While not a great photo (taken from my mobile), it does capture something timeless somehow. I own a number of similar pictures from this age: a gang of scuffy kids on parched grass, washed out colouring, baseball bat and soccer balls, unwilling photo participants ... yep, same as it ever was. On our block, San Ramon, it was the Emerson kids, the Prices, Porters, Churches, Hiennas and others - probably 20 of us in all. Since it was a quiet street, we often played in it: prison ball, tag, whatever as long as there was sunshine we were out there. San Ramon was also memorable for the go-carting. Our neighbor Todd (four years older then me) and I spent months nailing planks and wood-scraps, stealing grocery-carts for the wheels and devising hand brakes from broom-shafts, which were jammed on to the downward pavement (alternative: the sole of one's sneaker; feet otherwise used for steering). Rubber-band guns optional -- lock and load, baby. Of course the best part was the whooping and hollering down some crazy hill, traffic or blind curve be damned. And where were the adults?

Blast Away

Practice makes perfect. Here our little angel performs the theme to "Mission Impossible" followed by "Mary Had A Little Lamb."

Madeleine and I have a discussion about jobs.

Me: "Maybe you would enjoy walking a few of the local dogs? For money."

Madeleine: "How much?"

Me: "Well, you could walk two dogs for forty-five minutes. What seems fair?"

Madeleine: "Twenty pounds. For each dog."

Me:

Madeleine: "I don't want to be poor."

Me: "Let's think of something a little more reasonable. My first job was about your age. I swept and tended our neighbors garden for $2 an hour. "

Madeleine: "That was a lot of money?"

Me: "It let me buy comic books which were 25p back then."

Madeleine:

Me: "So how many comics could I buy?"

Madeleine: "Five?"

Me: "Try again."

Madeleine: "Six with 10p left over?"

Me: "You're guessing."

Madeleine: "You know I have a problem with American money! Besides, I would not want to take money from old people."

Me:

(Eitan is away for several nights with his class at Juniper Hall).

Me: "How much does it cost?"

Sonnet: "£120."

Madeleine: "£120! What are they spending all that money on?!"

Me: "Candy?"

Madeleine: "That is so much money. That is, like, over 1,000 candy bars. Or two million!"

Madeleine sits in the bath, miserable, while Sonnet combs through her hair for nits.

Me: "What do you think Eitan is doing right now?"

Madeleine, whimpering: "Having fun . .. ."

David Cameron is officially the Prime Minister, having worked a deal with the Lib Dems giving them 363 seats in the Commons, comfortably over the 326 required for a majority. We may now avoid the another election until 2015, as opposed to voting again in a few months.

Tutor

Eitan, pictured, with his tutor Stephanie who is very cool in her black knee-high boots and stylish jeans and knits. She has the perfect attitude for a kid who already puts a lot of pressure on himself. Eitan prepares for the 10+ exam which he will take next year which will decide, more-or-less, where he goes to secondary school (we are blessed to have a good selection in our area). If the 10+ goes well, he will have a year to relax; otherwise he will take a similar exam, the 11+, the following year with the other kids his age.

Gordon Brown will step down by August and the bets are on for the next Labour party leader. I think David Miliband, the Secretary of State, who is yuful and charismatic. So far, he has pledged his loyalty to Super Gee so we shall see how the political cards fall this summer. Cameron, meanwhile, prepares to govern as he negotiates with the Lib Dems. Most likely he will call another election for next year to get the clean mandate. Governing won't be much fun. Taxes are already 50% for over £150K and will likely go up given our 60% leveraged economy. Pensions and other benefits are exposed while social programs will be on the chopping block. Last year around this time I made a bet with a friend that, given the economy and financial crisis, there might be rioting in the UK. I was being facetious. Now if I said Europe I would have won that bet thanks to Greece.

Road Trip

Eitan is away for the very first time as his class goes to Juniper Hall, a country residence where the kids hike, learn about the natural world and eat junk food in a slumber party atmosphere complete with bunk beds and sleeping bags (I recall the boy's first day of school; Sonnet gets teary eyed). Three day camp, dude! - I feel sorry for the teachers and staff. The school trip takes place every year about this time for the year-fours so Madeleine, duly jealous, will get hers in 2011. Meanwhile we enjoy having the kid all to ourselves - Sonnet takes Madeleine for a bike ride in Richmond Park then strawberry sundays; I pounce on her early this morning (she groans "leave me alone, Dad") before chocolate croissants. So Eitan has been thinking about Juniper Hall for weeks and he tells me beforehand that he is both "excited and a bit scared" which is fair enough. Any deserving adventure should have these qualities at any age. My first separation from home at age-12 at swimming camp in San Diego. Man, that was care free. I write Eitan a letter -- can it be another first? -- which he will read sometime today I imagine. Sadly, we no longer keep a record of each other this way. Emails just don't cut it.

I have over 300 letters from my year in Geneva which I patiently scan and send back to their source (I keep the original). How extraordinary to receive a record of one's thoughts at age 16. A lot was going on back then, no doubt. At some point maybe I will share these correspondences in this blog, observing privacy of course. I don't know. Somewhere in my possession is a letter I wrote to myself in Social Living class in tenth grade (1983) which teacher Nancy Rubin sent to my parent's house in 2000. I have not had opened it (chicken, I be) so maybe I will gift it to Eitan when he turns 16.

The Colonel

I love the image. No doubt, a bunch of MBAs (when I was at Columbia: "the most important initials after your MBA are KFC") got together and stream-lined "Kentucky Fried Chicken" to KFC and turned the Colonel into Aunt Jemima (irony?) - how can one not adore the chubby southern fellow? Or, more importantly for them, how can your kids not adore him?

KFC is the world's most popular chicken and, every day, the restaurant serves over 12 million people in 14,000 restaurants (in the US, KFC is a $5.3 billion business). Meanwhile, I can only think of one KFC in London -- located on the down-scale Harrow Road in northwest London not far from our first first flat. I went there once. This does not mean your typical Brit shuns fast food. No, sir. England invented fast-food having given the working classes 'fish and chips' in the 19th century following trawl fishing in the North Sea. In 1860, the first chip shop was opened in London by Jewish proprietor Joseph Malin, who married together 2fish fried in the Jewish fashion" with chips (you can read all about this in Jay Raynor's book, "Enduring Love," 2005).

Fish and Chips, according to the Foreign and Commonwealth offices, remains Britain's top fast-food while "burger bars" the most popular fast-food restaurant - 2.5 million Brits served by McDonald's every day. According to Market Research, the British spent $390 per head on fast food in 2005, trailing the US ($566) and Canada ($456). The UK has the world's highest proportion of fast food restaurants per person while tiny England accounted for 25% of the planet's fast food consumption.

Not surprisingly: England's male and female obesity increased from 13.2% in 1993 to 23.1% in 2005 and 16.4% to 24.8%, respectively (NHS).

Me: "The only rule is that I have to see you."

Madeleine: "Can I play in the bushes?"

Prime Minister?

Is DC the PM? Who knows. Following Thursday's razor edge elections we have a hung parliament with the Tories in front yet failing to capture a 50% majority by 20 seats (they have 306 of 326 needed or, by one analysis, 16,000 votes shy in the closest electorate races) required to govern. Despite Labour's loss, Gordon Brown remains Prime Minister, as is the custom in these situations, and it is upon him to either form a government or step down which, really, is his moral obligation. Being Super Gee, I cannot see this happening by tomorrow and hence... we're screwed. Not surprisingly, Stirling falls to year-lows against the dollar and the financial markets twitter. Without a clear winner, we could be staring at five years of party bickering and dickering and little precious legislation. We can ill afford this state given the UK's public sector net debt of £848.5 billion or 60% of National GDP (source: Office National Statistics). The PBR (annual government borrowing) forecast for 2009/2010 is net borrowing of £178 billion or 12% GDP. Any retard can see this is not sustainable. What is more, the UK's national debt is actually a lot higher because the figures should include pension contributions and private finance initiatives which government is obliged to pay. The Centre for Policy Studies (at 2008 year-end) suggests that the real national debit is more like £1,340 billion or 103.5% of GDP.

Cameron will likely form a majority with Lib Dems, giving them their cherished campaign reform which has otherwise benefited the Tories, in return to govern. I see a poisoned chalice.

Change She Be Coming

Today's election will, presumably, turf Gordon Brown out from Number 10 (unfortunately the mover-van behind Downing St in my image unclear but do trust that it is there). The financial markets are betting on a Tory majority while most polls suggest a hung parliament as neither party able to form a majority government of more than 50% of the seats in the House of Commons. If this happens, five more years of Super Gee unless he steps down - fat chance.

So bare with me, dear reader: parliament is the supreme legislative body in the UK and alone possesses legislative supremacy and thereby ultimate power over all other political bodies in the UK and our territories. At its head: the King or, as today, Queen Elizabeth II.

The parliament is bicameral, with an upper house, the House of Lords, and a lower house, the House of Commons. The Queen is the third component of legislature. The House of Lords includes Spiritual Lords (bishops of the Church of England) who spout on about buggery and fox-hunting and Peerage Lords (appointed by the King) who spout on about buggery and fox-hunting. Prior to the opening of the Supreme Court in 2009, the House of Lords also performed a judicial role through the Law Lords. The House of Commons, by contrast, an elected chamber with 650 members; voting is held every five years including today. The name BTW not because it originally represented commoners but rather because the constituencies were from the commons -- land areas.

Last election non held on a Thursday? 1931, on a Tuesday. There you have it.

White Rock

In those fine, early, years of courtship Sonnet and I often went to my parent's cabin in Bear Valley. Here she is at Lake Alpine in the summer of '94. Best decision I ever made.

Eitan moves up in swimming and now trains with the 10-11 year-old squad (he is the youngest). The boy has five weekly practices of 90 minutes, including Monday morning 5:30AM which we will miss, thank you very much. Unfortunately, the other pool-times not exactly accommodating as they cater to the older kids so last night Eitan trains from 7:30PM until 9PM going to bed around 10PM. Back and forth and back and forth he goes - never a complaint. His coach tells me he is a pleasure: competitive yet willing to take instruction. I might suggest the competitiveness from me while the patience and ability to remain focused Sonnet's. Last night the kids do individual medleys and I chuckle at the butterfly which takes some time and practice and a little bit of arm strong -- all forthcoming. I use the time to go for a jog along the Thames on a perfect, cool, late spring evening where the sun hangs over the river for what seems like hours. Thanks to our recent rain, the green grass and tree-leaves vibrate with colour; the water is a silver-dark glass broken only by the rowers' wake. When it works, it really works.

"Be your own boss. Sack your MP. Choose y our own school. Own your own home. Veto high council tax rises. Vote for your police commissioner. Save your local post office."

--David Cameron on the campaign trail (the general elections tomorrow)

It's A Bank Holiday

Two thirds of May's rain falls over the weekend, blighting the bank holiday. As if there was some drama here. The Met Office issues 14 flood alerts around Kent, Sussex, Surrey and London. I spend my yesterday at a football tournament in poncho and wellies huddled beneath an umbrella and shivering with the other dads. We drink coffee from white Styrofoam cups to try and stay warm (in the background, on the radio: Chelsea and ManU slug it out for the Premier League title - one point separates the Blues from the Red Devils with one game remaining). The boys have a good time racing back and forth on astro-turff pitches playing five-a-side. Never they mind the weather. Madeleine cranks out her home work for tomorrow as I write.

Last night we go to a fun party in Notting Hill celebrating Paul and Simon's birthday. A chef prepares sushi while others serve champagne. We mingle with an abundance of attractive, well groomed, people while the women's long legs pointed with toe wedges showing manicured, coloured, toe nails. We chat with Natalie and Justin, who completed last weekend's London marathon in 3:51, which is a rocking time for his first go or any go. Plus he enjoyed the experience which has never happened for me - at least, after 22 miles. B.. o.. n k. Edwin, meanwhile, is in France where rumour has it he finished inside the top-10 in the men's European duathlon championships. Sonnet looks her usual radiant self and I am a lucky man to leave with her. We drive Puk and Lars to East Sheen and home and we are delighted that the bought a house, Friday, not too far from us.

Me: "What are you doing?"

Eitan: "I am jogging [in place] to get some exercise."

Me: "In your bed room?"

Eitan: "I am going to do this until 9:30AM while listening to Capital FM." (it is 8:48AM)

Me:

Kids ALL-TIME Favourite Music Video

Groomsmen

Photo from Eric's wedding at Cornell, 1991. Eric woke a judge at Midnight, following the rehearsal dinner, to obtain a license. Roger, behind me, departing New York for California leaving me without a best friend and room mate. Chas, to the right, living in Providence working the meat counter at Almacs. Eric's brother Matt found religion. The dude second from the far-left lost his marbles completely and institutionalised. Marc, on the far right, became a public policy analyst at the American Federation of State, County and Municipal Employees in Washington DC. Enough said there. I was breaking up with my college sweat heart and trying to figure out: which way is up? So, yes, there was a lot happening on this particular week-end. I think most of us are pretty glad to have worked our way through that anxious, post-college, transitional period with our friendships stronger for it ("gold dust," says Judge Ballachey). We certainly love to relive many of the stories .. with a buffer of twenty years.

Driving to Eitan's football tournament this afternoon.

Eitan: "How much does gas cost?"

Me: "A tank of gas is about £50."

Eitan:

Me: "Your next question should be: 'how far does a tank of gas go?'"

Eitan:

Me: "Well, if we get about 300 miles for a tank of gas, how much does it cost to drive a mile?"

Eitan:

Me: "Do you know which one is the numerator?"

Eitan:

Me: "Do you care?"

Eitan: "No."

Drill, Baby, Drill

At this writing, the Gulf of Mexico oil spill has spread over an area of 100 miles long and 45 miles wide (picture, from NASA). The April 21 explosion at the Deepwater Horizon oil rig site, which is leased to BP, continues to flow at 1,000 barrels (42,000 gallons) a day from damaged pipes 50 miles off-shore and 5,000 feet underwater. The spill will soon eclipse the 1989 Exxon Valdez incident as the worst U.S. oil disaster in history (11 million barrels) in a matter of weeks and a growing number of experts warn that the situation may already be much worse. It may take three months or longer to staunch the flow. More good news from the accountable generation.

"What does he actually seek to accomplish, after he's done turning back the waters and healing the planet?"

--Sarah Palin on Presidential Candidate Barack Obama's proposed energy policies, September 4, 2008

Madeleine

Madeleine contemplates giving her sandwich to the goldfish, which receives a stern look from yours truly. She desists. This morning the kid has three hours of performance class which, she tells me, includes "singing, dancing and some acting" which I imagine she is pretty good at. Performance class has replaced football on Saturday mornings - unfortunately, girls have a limited choice of teams or leagues for their advancement. While soccer the national pastime, it is a boys game in the UK (by far the most popular girls sport here is netball, which started in England and sort of like basketball). At some point Madeleine lost interest, despite being one of the fastest kids at Palewell Park. She still has swim-team so sports not over by a long shot while we have yet to find that one thing Madeleine wants to do more than anything else. For now, it is Tommy or arts and crafts or playing with some creature she has found in the pond. She loves to disappear into her imagination and can spend the day re-arranging her bedroom toys. I remind myself: no rush.

Christian And A Top-Ten

Here is a final snap of Christain in SF. We hang out before my return flight Wednesday. Note the two remote-controls and the New York Times Review of Books. That's my man.

So, today, Saturday, begins another strangely named "Bank Holiday Week-end" and no work Monday. Surely these Brits could be more imaginative naming their national holidays? There are a few good ones to choose from. In 2002, the BBC broadcast "The 100 Greatest Britons" which they rolled out with confetti: I was riveted by the prospect of Di beating out Churchill for #1. Here is the Top 10 great and the good:

1. Churchill

2. Isambard Kingdom Brunel (1806-1965), engineer, creator of Great Western Railway

3. Diana, Princess of Wales, "the people's princess."

4. Charles Darwin (1809-1882)

5. Shakespeare (1564-1616)

6. Sir Isaac Newton (1643-1727)

7. Queen Elizabeth I (1558-1603)

8. John Lennon

9. Vice Admiral Horatio Nelson (1758-1805), naval commander

10. Oliver Cromwell (1599-1658), Lord Protector

David Beckham was was #33 and, while Eitan might agree re England's greatest mid-fielder, we really do see the talent fall off sharply thereafter: Boy George, #46? And what about Sir Tim Berners-Lee, inventor of the World Wide Web, only #99 - without him, you would be spared this blog.

Eitan observes a charity box: "Can you give me some money for them?"

Me: "How about you use your allowance."

Eitan: "Well, that does not seem fair, does it?"

Yo All In The Game Yo

I come home to an inside job as Sonnet tears up the living room. We are going room-by-room and eventually the en suite gold leaf toast. Sooner the better. Our bedroom's green carpet also high on the priority list but, for now, another day. So, pictured, we rip out the existing horrible carpet, correct the ceiling cracks, take down the heavy drapes and change the overhead lights; we sink the flat-screen TV into a wall and re-wire everything. Wi-fi, baby. The fireplace will stay the same, God bless. Sonnet selects a cream and pewter colour palette. Tres lounge. Eitan and I smack Obama-rocks re the new hi-def screen which will cable June World Cup. England BTW ranked eighth going into the finals with, given the talent, a reasonable shot at the title. We have been here before, dear reader. Oh, my, the thought of being in the UK when the World Cup trophy returned to football's founders -- Oooh. oo. oo. I remember like yesterday watching the '98 semi-finals when 18-year old Michael Owen carved up Argentina at the Stade Geoffroy-Guichard, Saint Etienne (France) in a thriller England lost, 3-2. It was like the Cal-Stanford Big Game, '82. Well, almost. Madeleine could care less. Yo, all in the game, yo.

Modern Travel

So I am greeted at Heathrow Terminal 5 ... by this. How Space 1999. The Jr. Varsity knows that T5 is only for British Airways. More expert travellers will tell you that it is the largest free-standing building in the UK and is as big as 50 football pitches or Hyde Park. There is enough glass to stretch between T5 and Buckingham Palace. The roof can be raised to add another layer in the future. There are already seven floors: four above the ground and three below. The depth to the bottom of the building is deeper than the height of St Paul's Cathedral.

During construction, two rivers were diverted around the T5 site. Fish and other water creatures were moved before the diversion, and new channels were made habitable for wildlife. This is probably better than the villagers of Sipson, whose 700 homes may one day be demolished for the third runway. But that is next year's story. There are 11 miles of baggage conveyor belts and baggage can travel at up to 30mph. Since this is Britain, the UK's single biggest dig unearthed >80,000 items including pots, cups, buckets, flints and 3,000BC hand axe. Dude.

T5 was designed by Sir Richard Rogers and capable of 'processing' 30 million people including yours truly. Heathrow's existing two runways are at 98% capacity or around 67 million passengers a year - making us the busiest airport in Europe and the third most visited in the world. Paris CDG, by contrast, is at <70%>annum. Will there be a third runway and T6? It depends on the May 7 elections. Labour has approved the expansion despite the European Union's objection that a third-runway violates the human rights of those relocated or under the flight-path; the Tories oppose it. In the end, it may come down to economics: Heathrow employs 50,000 people and many more indirectly. It is a critical piece of the Southeast's economic engine and enhances London's status as a key gateway city. Not insignificantly, 20 years and several £billions have gone into planning consulting. By chance, I met the head of McKinsey & Company's global transportation practice at an Obama fundraiser who advises British government on Heathrow - he said the third runway "no way" and rather we should distribute the network across existing Heathrow, Gatwick, Stanstead and Luton with hi-speed rail. I would too. But: nobody wants to inter-connect those long-haul flights. Why that when Schiphol?