Category Archives: Pics

The Big Short #filmreview

Received from Russell Lund
Sat, 16 Jan 2016 at 10:41 p.m.

Banks, an accountant once told me, are not your friend. “They lend you an umbrella on a fine day and take it away when it’s raining.” This is the film of the year for anyone who has ever been stiffed by a bank. (Anyone left in the room?)

The Big Short is an adaptation of a book by Michael Lewis, considered one of the greatest living American writers. Amazingly, he achieved this storied status writing non fiction about the financial world, as a result his work is probably not on the radar of the general book buying public.

On the back cover of Lewis’ latest book, Flashboys, one of his competitors wrote:
“I read Michael Lewis for the same reason that I watch Tiger Woods. I will never be as good as him, but every now and then it’s good to be reminded what genius looks like.”

Expectations were very high for this film adaptation. The Big Short explains the origins of the Global Financial Crisis (GFC) and the unlikely band of financial misfits and outcasts that defied the banks, the brokers, the conventional wisdom and the entire industry, and “shorted”, ie bet against the idea that American housing prices were untethered to fundamentals and would continue to rise forever. They all became obscenely wealthy as a result. It’s a David vs Goliath story of biblical proportions.

Steve Carrell gives an Oscar level performance as Steve Eisner, the socially inept hedge fund manager with a social conscience, disgusted by his own industry. Interestingly, even as the hero of the piece Eisner did not allow his name to be used, one gets the idea that the big name cast of Steve Carrell, Brad Pitt, Christian Bale and Ryan Gosling would have almost come to blows over who got to play the egocentric blowhard that is Gregg Lippmann, in charge of creating and selling the toxic mortgage bonds for Deutsche Bank and through whose lens the film is narrated. To give a flavour of Lippmann, without spoiling the treat that awaits viewers, Lewis quotes Lippmann’s boss in the book, “I have nothing bad to say about Gregg…. apart from that he is an effing whack job”….

It is apparent there have been a lot of legal issues around the identity of the main protagonists. Bankers who were happy to fleece and pillage the American public aren’t keen to be named and shamed in the film. This may explain why the film has been so long in coming after the events of 2008. Strangely, this includes a couple of the big shorts who have the (relative) moral high ground. Those who have read the book will see in an instant that Steve Carell is portraying Steve Eisner, renamed as Mark Baum. Ryan Gosling Bale is the alter ego of the splendidly noxious Gregg Lippmann, renamed Gerald Vennerts. The one big short that allowed his name to be used is Dr Michael Burry, who was the first to discover the fraudulent truth about the mortgage bond market, and he emerges from the film with his credibility enhanced.

Fans of The Big Short should be extremely grateful to Brad Pitt. His greatest contribution wasn’t his role as ex banker Ben Rickerts awaiting Armageddon, fine though he is, but that he lent his gravitas and influence (and quite likely his money) to the film as producer. The financing of the film would have had its challenges, one suspects.

The-Big-Short_Novel-Cover [bucksandcorn.com]

Of the film’s many subtle touches is the name Ben Rickerts, a play ‘derivative’ on Jim Rickards, the famously pessimistic financial commentator who wrote The Death of Money: The Coming Collapse of the International Monetary System, in 2012. The best line in the film is Lippmann’s: “I’m standing in front of a burning house and I’m offering you fire insurance.”

The film was not quite able to reproduce the laugh out loud sophistry of the book, but it does an outstanding job of explaining the financial theory behind the madness in a variety of entertaining ways including supermodels, casino tables, Selena Gomez and celebrity chefs. It shows that despite the sophistication of the financial world it is still driven by groupthink herd behaviour at its most basic level.

The most disturbing part of the film is where all the “big shorts” arrive at the same realisation that ALL of the banks and the rating agencies had no compunction in resorting to fraud when the tsunami of mortgage defaults began to rain down upon the bonds they had created. As the legendary investor Warren Buffet says, show me the incentive and I will show you the result. Eisner’s conclusion was that the United States lives in an era of fraud – in all aspects of modern life. His disappointment wasn’t that it was morally wrong (spoken like a true banker) but that for thousands of years, fraud and short-term thinking have never worked. He placed a billion dollar bet against the banking industry on that premise, and won.

While filmgoers might leave the theatre safe in the knowledge that this was an American banking problem and its menacing shadows do not darken our shores, in the parlance of the film, this would be another fraudulent misrepresentation. The activities of the four Australian banks that make up the vast majority of the New Zealand banking industry make the US banks of the film look like amateurs. The list of transgressions includes the BNZ found guilty of tax evasion in 2014 to the NZ Government of around $600M (IRD’s estimated liability of all four Australian banks is estimated at up to 2 billion dollars). Australian banks were active in the global LIBOR price fixing scandal that erupted in 2013. The ANZ recently settled with a group of ripped off NZ farmers for $18M. The ANZ – and other banks – having sold hundreds of millions of interest rate swaps to farmers without explaining what they are and the potential liabilities. These four Australian banks, because of their cosy oligopoly in Australasia, are among the most profitable banks in the western world. How do we know this? Because last year in an announcement ignored by the NZ media, Warren Buffet, America’s most famous and successful multibillionaire “value” investor declared that he really liked what he saw with the Australian banks and would be taking a major multibillion-dollar shareholding in one of the big four – he just hadn’t decided which one yet.

However, the Australian Financial Review in an open letter to Buffet published in July 2015, warned Buffet that the banks are in fact very highly leveraged ($33 of debt to $1 of equity) and highly exposed to the mortgage market. This is between double and triple the leverage of big US Banks like Wells Fargo, in which Buffet also owns large positions.

The IMF has even written that the leverage of the Australian banks is “challenging” in 2015. By IMF standards, this is very blunt.

the-big-short-poster [shockya.com]

So remember, when you’re facing that nice mobile mortgage manager who will lend you a million to buy that fixer upper in Grey Lynn…. they are simply servants with no discretion whatsoever, in a business teetering on a pile of overinflated mortgage debt, and when the excrement hits the fan, they will be absolutely ruthless. This is the enduring, priceless message of The Big Short.

The film reserves its best ridicule to a couple of mortgage brokers that specialise in writing adjustable rate “teaser” loans to strippers (“cash rich and no assets”) in the full knowledge they cannot afford the repayments that will rise 200 percent when the true interest rates kick in on their loans. The brokers brag about simply writing up their NINJA loans (no income no job no assets) taking their fee and fleeing. Eisner is sold on the idea that the mortgage industry is fundamentally rotten and fraudulent in one very funny scene where a stripper advises him, while working, that she owns five properties and a condo.

House price bubbles, speculation, irrational confidence, low low interest loans, 30-year mortgages, stagnant incomes…. it all sounds scarily familiar. Surely it couldn’t happen here…. could it?

The answer is in Lewis’ 2011 book, Boomerang. We will have to wait until someone films that, if the ATM machines are still working at that point.

Eisner poses and answers the fundamental question in the film – when incomes are stagnant how do you make poor people feel good – the answer is by lending them cheap money.

Paramount Pictures Nov 23, 2015 | The Big Short Trailer

Paramount Pictures Dec 7, 2015 | The Big Short – “Jenga” Clip

Paramount Pictures Dec 23, 2015 | The Big Short – “The Big Leap” Featurette

█ The film is nominated for five Academy Awards, including Best Picture and Best Director.

Posted by Elizabeth Kerr

*Image (top): pixgood.com – Michael Lewis

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Robert Hamlin: Dreadnoughts and Crosses #Anzacs #Gallipoli

Dreadnoughts and Crosses – How battleships brought the ANZACS to Gallipoli

By Robert Hamlin

Part 1 – The South American Arena

Picture 1 HMS DreadnoughtHMS Dreadnought: The revolutionary fighting machine, launched in 1906, whose namesakes eventually brought the ANZACS to Gallipoli.

4.00 am on Sunday, 20 December 2015 marked the centenary of the last man leaving ANZAC cove at the end of the Gallipoli campaign. By the time the Allies evacuated the peninsula after just over eight months of fighting, each side had lost just under 60,000 dead. By the military standards of other battles in World War I these losses were small. Despite this, for three combatant countries, the young dominions of Australia and New Zealand and the yet to be born Turkish Republic, the battle was a seminal national event.

For this reason the details of the battle itself are well known and have been repeatedly re-enacted in print, video and film. What has received slightly less attention is how the Allies and the Turkish (Ottoman) Empire came to be enemies in the first place. The Ottoman Empire was not part of the deadly twin daisy chains of alliances and obligations that dragged all the other great imperial powers of Europe into an involuntary state of war in the days after the Austro Hungarian Empire chose to attack Serbia. The Ottomans had the luxury of choice. They could join the Allies, or they could join the Central Powers. Or, they could not join in at all – the eminently sensible option favoured by the then Sultan, Mehmed V.

The convoluted and sometimes ridiculous story of how the Ottoman Empire eventually did get involved on the side of the Central Powers, and thus became one of New Zealand’s ‘enemies’, makes for interesting reading. It involves pride, greed, incompetence, insubordination, brilliant opportunism and desperate decisions made in haste with little information. Above all it involves battleships, the great floating fortresses that so disastrously possessed the minds of men both great and small in the first decades of the twentieth century. Battleship mania was a truly global phenomenon. Thus this story begins not in Europe or Asia, but in South America some eight years before the First World War broke out.

At the beginning of the twentieth century the four-cornered battleship building race between Germany, Britain, the USA and Japan was well established. With their greater shipyard capacity, this was a race that the USA and Britain should have won comfortably. However, they were hampered by their political systems. The governments of Germany and Japan, where democracy was tightly delimited, were able to pursue their naval build up steadily and in a carefully planned manner. In the USA and Britain public opinion and short-term political expediency made this impossible. Periods of complacency when shipyards were starved of orders for battleships alternated with periods of panic, when they were literally drowning in them.

This created an intolerable situation in British and American shipyards. Dreadnought battleships were at the limits of the technology of their day. Their construction required massive fixed installations served by enormous and highly skilled workforces that simply could not be assembled and dispersed at will. If a race-winning dreadnought building capacity was to be maintained, somehow the demand for them within these two democracies had to be smoothed out. Then, as now, it was realised that exporting these cutting-edge weapons of war to third countries was one way in which this could be done. As a result, both Britain and the USA became vicious rivals in the international export market for dreadnought battleships. The most skilled and unscrupulous salesman of their day fanned out from the British and American yards, backed by enormous budgets and the full diplomatic capacities of their respective governments.

The happiest hunting ground for these dreadnought salesmen was South America. Nowhere in the world had changed politically as much as this continent had in the nineteenth century. In 1800 the continent was sleepily divided between the declining empires of Spain and Portugal. By 1900 all this had been swept away and replaced by a series of young, prickly and increasingly wealthy republics. The largest of these: Brazil, Chile and Argentina had a particularly volatile relationship with one another, in which diplomatic tension, military posturing and sporadic minor actions created an ideal environment for battleship selling.

In Part 2, the activities of the international dreadnought salesmen across three continents create a ludicrous but potentially explosive situation.

Part 2 – The battleship barterers

Picture 2 Rio de Janeiro - Sultan Osman I - AgincourtRio de Janeiro – Sultan Osman I – Agincourt: One ship, three owners, three names

Once they had identified South America as the prime market for British and American battleships, the Edwardian dreadnought builders got straight to work. By various adroit manoeuvrings, the British and American sales representatives succeeded in selling no less than seven dreadnoughts to these three countries in less than three years. The process started with Brazil agreeing to buy three dreadnoughts from Britain in 1906; with two to be constructed immediately, and a third to be laid down once the first two had been completed. Argentina and Chile promptly responded by each ordering two larger ships: Chile’s from Britain, and Argentina’s from the United States.

However, the fever rapidly abated, and by 1908 the South American ardour for battleship building was cooling in the face of the staggering costs and risks of escalation. In the case of Brazil, an additional chill was provided by a major naval mutiny and the collapse of the rubber and coffee export commodity markets that had been expected to pay for the ships. As a result Brazil attempted to extricate itself from its commitment to build the third ship that it had ordered. The British fought hard to avoid this, and eventually their efforts were successful. However, the witches’ brew of conflicting commercial and political agendas that eventually preserved the deal also produced what was the most ridiculous design ever executed in the dreadnought era.

The Rio de Janeiro was built for show. The Brazilian government were determined that if they were going to have to pay for this unwanted battleship, then it should be the most impressive yet seen in South America. The choice lay between bigger guns or more turrets. Turrets won the day, and the Rio de Janeiro shipped seven, in a period when every other nation was standardising on four. This meant a big ship, but Brazil’s maintenance facilities were limited, which meant that the big ship had to be narrow and tremendously long. Finally the capacity for the officers to entertain in style and live in comfort had a far higher priority than other navies. The Rio de Janeiro had far larger internal spaces and far fewer watertight bulkheads than her equivalents. All of these requirements, plus a respectable top speed, meant that something had to give, and that something was armour. Rio de Janeiro had armour that was barely more than half the thickness of her contemporaries.

Perhaps as the Rio de Janeiro took shape on the slipway it became increasingly obvious that she looked more ridiculous than imposing. Whatever the reason, the Brazilian government decided to get rid of her. In late 1913 she was put up for sale while still incomplete, and sold to the Ottoman Empire for just under six million dollars – a respectable sum for that time. The Rio de Janeiro became the Sultan Osman I. The Brazilians, no doubt highly relieved, departed from the scene. The deal may have been facilitated by the fact that the ever-active British dreadnought salesmen had already sold another larger and far more capable dreadnought, the Reşadiye, to the Ottomans two years previously.

Although Sultan Osman I was the weaker unit of the two new Turkish ships, the situation within the Ottoman Empire at the time of its acquisition endowed it with a much greater political importance to the Turks. The Ottoman Empire, the ‘sick man of Europe’ had been in retreat for half a century. Provinces in the Balkans and North Africa that had been Turkish for centuries had fallen away. The retreat had been accompanied by a sequence of mass murder and ethnic cleansings that had left millions of Turks dead and millions more displaced and destitute within the areas that are now modern Turkey.

The Turks were aware that this process was not complete, and that the Ottoman Empire’s neighbours harboured further expansionist ambitions that would potentially leave the Turkish nation partitioned and bereft of any territory or secure identity. This was a national rather than simply a government realisation. As the government was both chaotic and destitute, the Turkish nation raised the money to buy the Sultan Osman I, largely by public subscription and a myriad of small collections in coffee shops and the like. Special ‘navy donation medals’ of various grades were struck and given to larger donors. It was an act that both presaged and represented the popular will that would lead the Turks to victory at Gallipoli in 1915 and to a secure independence in 1923. The significance of the gesture was reinforced by the name that was given to her – that of the Ottoman Empire’s founder.

In Part 3, British misjudgements over the sale of the two battleships turn a possible ally into a potential foe.

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Te Ara I Whiti – light path #sharedway Auckland

Elevated illuminated space is exciting but how long until the shine wears off – this bad taste won’t even make it to Kitsch.

Light Path NelsonSt1-e1449104198336 [transportblog.co.nz - Patrick Reynolds]Light Path soaring-cycling-sensation [aucklandcouncil.govt.nz]

“This is a great day for Auckland’s inner city cycling network. The cycleway is a new and exciting urban space, creating a city centre where people feel safer and confident to ride a bike.” –Minister Simon Bridges

Comment #13 by David Bridewell  (2 days ago)
I think the cycle – and I trust walkway – is a good idea. But whoever chose that vile colour should be hauled into the centre of Aotea square and mercilessly flogged.

### nbr.co.nz Thu, 3 Dec 2015
‘Magenta Adventure’ cycleway opens in Auckland
By Emerson Howitt
Auckland cyclists are in the pink with today’s launch of the city’s latest piece of cycle-friendly infrastructure. The $18 million magenta coloured Light Path cycleway – already dubbed “Magenta Adventure” – was opened with a ribbon cutting ceremony presided by Transport Minister Simon Bridges, followed by schoolchildren cycling along the re-vamped Nelson St motorway off-ramp. […] The off-ramp was closed in 2005 after an upgrade to the central motorway junction left it surplus to requirements. […] The Light Path features interactive lighting along one side that will illuminate the structure at night.
Read more + 34 comments

iion Published on Dec 3, 2015
Te Ara I Whiti – The Light Path #LightPathAKL
@BikeAKL celebrated the opening of #LightPathAKL with hundreds of cyclists taking to the newly opened cycleway. We went along to see their reactions and join in the festivities. Interactive Light Installation by iion http://iion.co.nz

Light Path Canada-St-Bridge_5179 [transportblog.co.nz - Patrick Reynolds] 1Light Path Canada St Bridge [Patrick Reynolds]

### transportblog.co.nz Thu, 3 Dec 2015
Te Ara I Whiti – the lightpath
By Matt L
Auckland’s newest and certainly it’s most colourful cycleway (so far) was officially opened today by Transport Minister Simon Bridges. And I must say, Simon gave a fantastic speech showing he gets it, talking up the environmental, health, congestion and economic benefits of investing in cycling – this view was reinforced in discussion with him later. […] The new bridge connecting Canada St to the old offramp has been given the name of Te Ara I Whiti or the lightpath and combined is a fantastic addition to Auckland. […] One of the most surprising things about the project is just how little time it has taken from inception to delivery.
Read more

█ Video via TVNZ On Demand
Better Together: The Nelson Street Cycleway (4:51)
Get the inside track on the merging of the creative ideas of carver Katz Maihi and landscape architects and urban designers Monk Mackenzie + Land Lab, that have helped shape Auckland’s ambitious new cycleway design.
Link: https://www.tvnz.co.nz/content/tvnz/ondemand/shows/m/microsoft-better-together/s1/e3.html

Light Path [TVNZ On Demand Better Together - The Nelson Street Cycleway] screenshots[screenshots]

### NZ Herald Online 2:14 PM Saturday Dec 5, 2015
Pedal to the new metal
By Catherine Smith
I don’t usually claim to have much in common with engineers – putting things together is not my strong suit. But on Tuesday, when I donned a fluoro vest and rode the newest piece of Auckland’s cycling infrastructure with project manager Stephen Cummins of GHD, I couldn’t get enough of the geeky details of the shared pathway, formerly known as the old Nelson St off-ramp.

It is barely a year since the Lightpath Te Ara I Whiti (it got a fancy pants name at Thursday’s opening), first got the nod. New York’s glamour former tsar of transportation, Janette Sadik-Khan, was in town to talk up how she transformed the Big Apple’s car-clogged streets to plazas given over to people and bikes. She was less than flattering about Auckland’s un-connected bits of cycle paths. The “three Ls” who shape Auckland – mayor Len Brown, design head Ludo Campbell-Reid and chair of Auckland Transport Lester Levy – keen to impress Sadik-Khan, fell over themselves to promise Barbara Cuthbert of Bike Auckland in front of an audience of over 1500 city-lovers that they would convert the abandoned motorway into a connector between the aging Northwestern cycleway, the new Grafton Gully path and the rest of the city.

The result is extraordinary. This bridge, complete with art works of pulsing lights, pohutukawa trees and a stunning perspective of the city’s favourite bits is no dull bit of infrastructure. Cummins, possibly punch-drunk from lack of sleep, reckons that a project of this complexity would typically take a minimum of two years, but every one of the suppliers was so excited by this build that they pulled out all the stops to whittle that time to eight months. Despite reporting to many “parents” (this is an NZ Transport Agency project as the stretch of road is part of the national motorway), the design team was tight and fast-moving: GHD was lead designer, with architects Monk Mackenzie and engineers from the Agency.

Early thoughts were to plunk something clunky and temporary between the back of K Rd and the old off-ramp. Fortunately, saner heads (and money from minister Simon Bridges’ urban cycleways programme) funded a much better option. Already it’s been named in the World Architectural Festival, design mags are raving.
Read more

Posted by Elizabeth Kerr

Light Path Nelson-St-at-Night-Brett-Blue [transportblog.co.nz]Light Path Nelson-St-at-Night-Brett-Green [transportblog.co.nz]blue green [transportblog.co.nz]

*Images: (top of page) transportblog.co.nz – cyclists by Patrick Reynolds, pictured at right; aucklandcouncil.govt.nz – Light Path soaring-cycling-sensation

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DCC cycle lanes, the real reason……. foul-ups @DUD

Received from Brian Miller
Sat, 24 Oct 2015 at 5:40 p.m.

The real reason why DCC wants cyclists to have their own cycling lane.

So this is why those people in funny clothes wander all over our roads!
—I knew there was a reason why I took up biking.

THE RETIREMENT BICYCLE
Retirement BicycleImage: Supplied

My doctor says to drink lots while exercising!
And I always follow the doctor’s advice.

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6.10.15 DCC v Tauranga CC + costly stadium cycle/walkway :[
12.9.15 Cr Kate ‘Cycleways’ Wilson —(disingenuous) fails constituents
3.9.15 Dunedin support for extensive cycle lanes and Free bicycles
22.8.15 DCC cycleway$ now tied to more ‘urban de$ign’ $pend…
18.7.15 DCC Cycleways: SEEING RED, apology NOT accepted
10.4.15 DCC cycleways propaganda continues #SpendSpendSpend
20.3.15 DCC Shame …John Wilson Dr nonsense, now Portobello Rd cycleway
11.2.15 Dunedin Cycleways: Pet project staff, ‘entitlement’? #irony

█ For more on Dunedin’s inordinately expensive Strategic Cycle Network, enter the term *cycle* in the search box at right.

Posted by Elizabeth Kerr

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Dunedin Airport dunnies —on approach or the quick sail/sale

Received from Jeff Dickie
Fri, 23 Oct 2015 at 6:59 p.m. and 7:03 p.m.

█ Message: I spotted these corny ads at the Dunedin Airport loo the other day. It may not be possible to flush anything more down the dunny given the quantity of ratepayers’ funds already being flushed!

Dunedin Airport dunnies 20151011_140436 (1)

Sat, 24 Oct 2015 at 5:13 p.m.

█ Message: The advt says “seated”! I for one would not want to be seated in front of this urinal!

Posted by Elizabeth Kerr

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[pedantic] Our city council for a speed hump ….ONLY at #DUD

### ODT Online Fri, 16 Oct 2015
Speed hump blunder undone pronto
By Craig Borley
A speed hump, installed in error as part of the South Dunedin cycleway works, was removed yesterday after only two days. The blunder occurred after the contractor was given the wrong plans.
Read more

Another unfortunate side effect of Greening Dunedin

speed bumps timthumb arghcentral.com [via netsolhost.com]

█ A report on redrawn plans for South Dunedin’s cycle network will be tabled at the ISC meeting on Thursday, 22 October 2015.

Posted by Elizabeth Kerr

*Image: arghcentral.com – timthumb (7.2.11) by Paul Sundstrom

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Royals bilious at #DUD

Received from Douglas Field
Thu, 15 Oct 2015 at 11:46 a.m.

Dunedin_Railway_Station2

### ODT Online Thu, 15 Oct 2015
Delight at Royals’ Dunedin visit
By Shawn McAvinue and Rhys Chamberlain
Prince Charles and the Duchess of Cornwall’s visit to Dunedin next month has “delighted” those selected to host the Royal couple during their most southern stop. The couple will land at Dunedin Airport on Thursday, November 5.
Read more

Posted by Elizabeth Kerr

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