North Korea fired another missile at the weekend. Kim Jong Un was happy with the result. As he should have been because he “guided” the launch personally according to the North Korean media. The Japanese I’m staying with couldn’t care less. They have no clue the Western media thinks their lives are in peril.
Even the earthquake two days before didn’t make the news here. It was just a 2 on the Richter Scale. There’s some sort of national furniture shortage in Japan, so I was the only one perched on a chair. It didn’t feel like a small earthquake on my lofty perch.
4 Stocks to Watch: Protect Your Wealth Amid a Korean War
On the beach facing west the day Korea fired the missile, I fell into a ditch. I was so busy trying to spot Korea and any incoming missiles that I didn’t look down. The potential grandparents-in-law were in fits from their front-row seats in the car.
It’s a telling sign that geopolitical risks can move the media and often move financial markets, but usually you’re better off keeping your eyes closer to your feet.
There are ditches filled with koi fish everywhere in Japan. And nobody can rob a house because they’re surrounded by flooded rice paddies and the miniature dykes you have to walk over. You can see people coming for hundreds of metres. And so can your extremely nosy neighbours. Some of the ditches are covered in metal sheets so you can drive over them. Everyone can hear you coming then.
But the real surprise here is cash. Japan might have robotic vacuums, heated toilet seats and self-opening taxi doors, but everyone uses cash. And it’s rude if you don’t minimise the amount of change required. More on breakthrough technology and obstinence tomorrow. I asked my old friend Sam Volkering about bitcoin and we’ve decided to turn his thoughts into a Q&A because they’re valuable to you, not just me. Ahead of that, you should see Sam’s presentation on bitcoin and cryptocurrencies. It’s our #1 most important idea right now. Watch it here.
Back to Japan and its obsession with cash. In a world of slow and steady deflation, holding cash doesn’t come with the same connotations as elsewhere. My partner’s high school friends expect a small pay cut each year from their high power corporate jobs in the oncology industry thanks to deflation. And banks are a royal pain in the neck to deal with – worse than the UK.
Perhaps Japan will be the last bastion in the War on Cash. Britons are certainly asking to be the first victims thanks to their use of plastic. At least most of them are. Some are prepared for the coming crackdown.
Europe is turning into a comedian’s dream
British comedians are going to have a great time with Europe in coming years. Are there any politically astute comedians still around?
In Thursday’s Capital & Conflict we took a look at Europe’s internal crises. On the weekend German chancellor Angela Merkel took up the mantle for us and complained about all the crises facing Europe externally too.
Brexit and a rift with Donald Trump’s new America are supposedly a reason for Europe to stick together. She even said Europe can no longer rely on Britain and the US. The world’s commentators and news agencies went bananas with just how momentous this comment supposedly is.
The idea that Europe is the one making a mess of things is never considered, despite all the evidence. Clearly the world has gone mad while Europe is the sane one…
Merkel made the comments in lieu of a G7 meeting. Why she and her European friends don’t leave their representation at such meetings to the EU is never asked. But it reeks of hypocrisy for Germany and France to take centre stage at such summits because of their size while pressuring other nations to submit to EU rule and representation elsewhere.
And if you take a look at the issues Merkel accuses the US on, they highlight nicely how the EU is being absurd.
Trump pushed for Nato members to pay their own way for defence. So Europe coming out from underneath the US’ wing probably suits him just fine. Mission accomplished for Trump.
Merkel and her EU gang chastised the US for being protectionist. But the EU is ranked as more protectionist by the World Trade Organisation, and quite significantly so. The same goes for US’ neighbours to the north and south. Trump’s threats for the US to behave like Europe on tariffs are seen as backward by the Europeans. But they’re the ones behaving like that in the first place.
Strangely enough, the exception to this is American pickup trucks thanks to something called the Chicken Tax. That’s another story.
What happened to the heart-warming ideas of cooperation and compromise which European leaders supposedly embody? They don’t apply to outsiders.
It’s not just Trump who is causing a problem according to Merkel. Theresa May’s Brexit is another sign that everyone else in the world is losing it.
May’s popularity at home has taken a tumble now that she has actually released policies. What a surprise…
But one of those policies hasn’t been highlighted by the media yet. Britain is courting the EU’s enemies simply because they are the EU’s enemies. Top of the list is EU troublemaker Poland.
Can anyone see the irony of Britain’s new focus on relations with Poland given Germany’s dominance on the continent?
Anyway, Poland is having a spat with the EU over refugee quotas while its government is pressuring Britain to continue to accept Poles as expected of them under EU law. Does anyone see the irony on that one?
When I visited Poland and other eastern European countries a year ago and gave speeches at universities, the support for the EU was very strong. I asked why and the answer was straightforward: “So we can leave for the UK and Germany.” Many young people already have.
Britain is trying to implement its age-old “divide and conquer” strategy for Europe, without the conquer bit I hope. The current focus is on eastern European states, which aren’t in line with EU policy. But they’re dangerous partners. It’ll be easy for countries to give up partnership with Britain in exchange for favour from the EU.
Why trade and immigration have to be so tied to politics in the first place is a mystery to me. If someone wants to buy and sell something across an imaginary line known as a border, others shouldn’t be allowed to interfere with it. Especially not politicians.
What to make of terrorism
Does an investment newsletter have anything useful to say about terrorism? Does terrorism have anything to say about investing?
Probably not. But there is something to add from the bizarre world of history that puts things into a more steady perspective. I hope it helps you to think about terrorism, Europe and the Middle East in a different light.
The excellent Tim Johnson from the Magic, Maths and Money blog wrote this in a detailed explanation:
A point struck me while reading a biography of Sir Richard Francis Bacon. For most of Bacon’s lifetime, married women in Britain could not own property, it was all owned by their husbands. This was not the case in Islam, with the famous example of Muhammed wife Khadija. Rather than this custom being seen as progressive by Victorian Britain, it was regarded as another manifestation of the effeminacy of Islam and part of the justification for Europe’s dominance of Islamic states, from North Africa to East Asia.
Islam’s toleration of sexual diversity was another manifestation of this effeminacy. Burton’s career in the East India Company was curtailed by his exploration of homosexual brothels and he coined the term ‘Sotadic zone’, which broadly coincided with the predominantly Muslim lands he was familiar with. In Wilfred Thesiger’s 1920s books on Arabia there is discussion of mukhannath and mustergil, people who are transgender and long accepted in Arabic society.
These portrayals of Islam are diametrically opposite to contemporary attitudes. Today it is the west that tolerates sexual diversity and gender equality while Islam is presented as repressive. My conclusion was, and is, that Islam provides a convenient embodiment of “the other” where by specific examples of how Islam is opposite to the West come to dominate how the west sees Islam, while the similarities are ignored. Many Muslims regard Friday 13th as the holiest day (the Arabic letter ‘M’ for Muhammed is the 13th in the alphabet); in the west it is regarded as unlucky.
Don’t let the posh tone fool you. It’s a very simple idea that Johnson has expressed by giving the complex-sounding example of Sir Bacon.
Humans seem to need an enemy. At least it’s very easy to manipulate them by creating one. You can find this phenomenon in just about every story from Disney to Die Hard 3, let alone reality. It’s the phenomenon that drives writers like Aldous Huxley and George Orwell. It’s also the justification for overzealous government.
But if you take a closer look at your enemy, you discover it’s a caricature created by those who benefit from having an enemy.
However you think about terrorism, Islam and the Middle East, please don’t be one of those easily fooled by the caricatures, including those of ourselves. Salman Abedi was.
Until next time,
Nick Hubble
Editor, Capital & Conflict
Category: Geopolitics