Monday, January 26, 2009
Monday, January 19, 2009
Gerard Baker, writing in the Times newspaper, described the potential adoption of "quantitative easing" as a revolutionary shift in policy and a new dawn in macro-economic management (though this brilliant journalist and commentator did leave the reader in some doubt as to whether or not this will represent a real or a false dawn). Even after allowing for journalist hyperbole, however, to call it "revolutionary" is over-stating the case - the Zimbabwean central bank, after all, seems to have been doing little else for the past few years - with the appalling consequences of hyper-inflation, just as occurred in the Weimar Republic in the 1920s and, before that, in the aftermath of the French Revolution. No doubt the Federal Reserve and the Bank of England's more modest injections of cash into the economy will not have quite such disastrous results, but if history teaches us anything, it suggests that quantitative easing is a dangerous policy to follow.
History would also suggest that in times of quantitative easing, real property and tangible assets are the best places to invest. There is an amusing (and probably apocryphal) anecdote which tells the story of a certain Emil Schultz who received his weekly salary during the worst period of the Weimar Republic in so many bundles of small-denomination notes that he was unable to carry them all home. He therefore borrowed a wheelbarrow from a friend and, on his way home, stopped at a small shop to buy some food. On leaving the shop, he found the money neatly stacked up on the ground, but the wheelbarrow stolen....
This anecdote brings me on to the subject of fraudsters and their credulous victims. Last week, in Kampala, I received an interesting approach from a certain Engineer K, who claimed to work for the National Water and Sewerage Corporation (NWSC) of Uganda. K explained to me at some length that the NWSC were sourcing spare parts for an urgent repair from Sweden, at great expense, while these same parts were available from a Kampala-based contact of his at a fraction of their imported cost. If I could be so kind as to go to his contact and buy the said spare parts, Engineer K would then arrange for the NWSC to purchase them from me at the import parity price, and I would make a tidy profit (to be divided between the two of us). Call me a cynic, but I think this is one of the oldest hustles ever invented. Once I have allowed greed to get the better of my common sense, I go to the contact and buy the spare parts. Engineer K and the contact then disappear, leaving me to discover that the parts I have bought are in fact worthless….. Of course, I am speculating here – maybe this time Engineer K is really telling the truth.
Recently, of course, this simple scam has been played out on a much larger and more damaging scale, the best example of which is the Madoff scandal, where so-called expert investors appear to have been seduced into believing that the delivery of steady year-on-year returns of 10% was somehow achievable through the alchemy of a secret investment management formula…… However, it also lies at the heart of the sub-prime debt crisis and the subsequent credit crunch, recession, mass unemployment and general financial misery, for which many economists and central bankers now suggest that quantitative easing is the best remedy.
Forgive me for my skepticism, but remember: if it looks too good to be true, it probably is.
Wednesday, January 14, 2009
Tuesday, January 13, 2009
A member of the normally toxic nightshade family,“in the wild,[Solanum Tuberosum] is a package of poisonous alkaloids. Stone age agronomists nurtured it, modified its genome and turned it into a staple in the Andes more than 8,000 years ago. Four hundred years ago, Spanish conquistadors brought it to Europe as a curiosity. Milliners used the flowers, soldiers carried it as animal feed and the people of Besançon were convinced that it spread leprosy. Yet, in the past 300 years, the potato has become the world's biggest non-grain staple. It took a trick by Louis XVI and Marie Antoinette - they ostentatiously guarded a court crop - to make suspicious Parisians salivate for potage du Barry and potatoes parmentier. In the last two centuries, growers have developed 3,000 varieties and introduced the crop to almost every human habitat. The uber-tuber is hardy, versatile and nourishing. It can be cloned or grown from seed, it may be roasted, fried, baked, boiled or turned into flour, and it can be kept through the winter. It can be served as soup, soufflé, main course, side dish or even as a vodka chaser. King Edward, Desiree, Maris Piper and the other 80 varieties of potato grown in Britain contain almost all the vitamins, proteins, carbohydrates and micronutrients necessary for survival. The tuber's blandness may be its strength: dieters may disapprove, but does anybody actively dislike its taste? The United Nations declared 2008 the International Year of the Potato. The celebration is on the wane, but Solanum tuberosum waxes stronger than ever.”
It is fascinating to wonder what drove those stone age Andean agronomists to experiment with and develop the tuber. What techniques did they use? How did they record and analyse the results? How grateful we should be for their perseverance!
On a more mundane level, another thing that interests me is exactly why the Irish potatoes we buy from Kampala markets taste so delicious – and so much better than most European potatoes. Is it because of growing conditions, variety selection or some other factor? Any answers gratefully received.
Tuesday, January 6, 2009
Anyone who reads this blog, now or in the future, will see that one of my enduring interests is the history of crops and food production, including agricultural technologies, and I am constantly reminded how little I know - but how much more than I used to know! The extent to which the developed world, in particular, has become ignorant of one of mankind's most basic activities and needs - food production - is staggering.
Does it matter? A resounding Yes! Two examples: organic production and genetically modified organisms. I don't profess to be an expert - I don't even know enough to know how little I know - and the reader is cautioned, but here goes:-
Organic ProductionMy view is that it is completely unsustainable on a large scale and I am yet to see any evidence to the contrary. Organic production is a luxury, suited only to small-scale speciality farming and products where (1) it is possible to control the environment - particularly with regard to pests - and (2) gain access to very substantial amounts of organic fertilisers (eg manure, composts, etc) that require considerable land resources for production. On a large scale, it is uneconomic and it will fail.
Genetically Modified Organisms
Recently, I was listening to a Radio Programme where an apparently intelligent and well-educated gentleman was expressing his deep concerns about GMO adoption. "I don't really understand it" he said "but it just doesn't feel right. I think it's a bad idea and should be banned." Astonishing! With attitudes like this, it becomes easy to see why Galileo was forced to retract his scientific evidence that the earth revolved around the sun, or why it took a long time before trial by ordeal for witches was outlawed.... Regardless of whether or not it "feels right", I have trawled the internet and I am yet to find any hard evidence that GMOs are harmful to health. Let's face facts - the global population is set to increase by at least another 2 billion over the next 30 years - we have to find ways to increase crop yields and agricultural efficiency. Obviously we have to be sensitive to environmental impact, but the widespread adoption of GMOs appears to offer the best opportunity to increase production without giving over an ever-increasing percentage of land to intensive cultivation.
This leads me on to what must have been one of the single most important scientific advances of the 20th century: the Haber Bosch process. In brief, this process enables the conversion of atmospheric Nitrogen into Ammonia - which can then be converted into other nitrogen compounds, including fertilisers. Nitrogen fertilisers are essential to plant and animal growth, but before the invention of the Haber-Bosch process, usable nitrogen was only generated through planting leguminous plants (which fix a small proportion of nitrogen in soils), composting, and using naturally occurring nitrate mineral and guano deposits. It is therefore no exaggeration to say that, without the invention of this process, the population growth in the 20th century (of about 4 billion people) could not have been sustained.
The Luddites among us would probably argue that global population increases (which, alongside other 20th century technological advances in health, sanitation and mechanisation were supported by the Haber-Bosch process) are the principal cause of environmental degradation, and they are probably right. But at the same time, who would turn the clock back to 1900, when sickness, child mortality, poor sanitation and hunger were universal evils?
Monday, January 5, 2009
It is all the more remarkable due to the circumstances under which it was written: Chekhov completed the play while suffering from severe tuberculosis, which was to kill him only six weeks after its first performance. One can only imagine – just as with van Gogh’s final paintings– the hunger and the drive of the artist, the white heat of creativity in the final moments of life.
Last year, I adapted the Cherry Orchard to 1960s East Africa. It wasn't actually that difficult to re-set the play in East Africa, the principal change being the substitution of ethnic tension and the impact of decolonisation for the emancipation of the Russian serfs and the enormous social changes this caused. This is testament to the enduring nature of the play's principal themes.
I have to admit, however, that it was not a huge success. Like many of Chekhov’s works, the main dramatic events occur offstage and are described through dialogue and individual characters’ interpretations, and the resultant lack of on-stage action can make the play seem static (especially for audiences brought up on TV and cinema). Also, the nuances and subtleties do not lend themselves to the uneven quality of an amateur cast and production team.
At least, that's my excuse.