Ode to Sorrow Draft 3

Liver-limbed, the skin of hardened wax
rests unpleasant and feathers fealty to an
awesome god. A good god, but spotted
and hard as the underbelly of a hippo.

An ode to sorrow:
What can I not forget, beautiful and forgiven. What now,
that time has surpassed
the will of my own memory? I am an ode to sorrow.

When I was younger my grandmother convinced me that
She had been a long-haul truck driver.
I remember the cold dawn of the day
I realized it couldnt be true.

In one month I will attend her unveiling. Seeing my family now
makes me want to sing an ode to sorrow,
to take a job driving long-haul,
and leaves me liver-limbed and scared.

Ode to Sorrow

Ode to Sorrow
with thanks to FG, now asleep in my bed

Liver-limbed, the skin of hardened wax
rests unpleasant and feathers fealty to an
awesome god. A good god, but spotted
and hard as the underbelly of a hippo.

An ode to sorrow:
What can I not forget, oh beautiful and forgiven.
What now, that time has surpassed the will of
my own memory? I am an ode to sorrow.

A small child my grandmother convinced me that she –
born in jersey city, raised in a department store –
had been a long-haul truck driver.
What a bad day when I realized it couldnt be true.

In one month I will attend her unveiling. This gift
from her passing reminds me of an ode to sorrow,
and leaves me liver-limbed and scared.
Tonight I worry for my baby, and am worried for my fears.

Entangling Alliances 2.0

Like many, when I started reading recently about Sovereign Wealth Funds, I was stimulated. Now I KEEP reading about them – they seem to be everywhere in the news. I don’t know why they stick out in my mind, but I tried to figure out why by writing something. This is draft two…. in which I basically compare SWF investment to the secret alliances that caused World War I.

There have been a number of articles recently about Sovereign Wealth Funds. A Sovereign Wealth Fund is an investment fund owned by a sovereign nation. National investment itself is not new. The only thing thats new about Sovereign Wealth Fund (SWF) investment is that now countries are directly investing in businesses, not other nations.

Kuwait established the first SWF in 1953. The UAEs fund was established in 1976 and is the largest, capitalized at over 800 billion. Chinas fund, which was established in 2007, is now capitalized at over 300 billion dollars. Theres no complete list, but somewhere between 30 and 50 nations now run SWFs.

From a pure market perspective, we are very happy that these funds exist. Craig Hakkio of the Federal Reserve Bank of Kansas City wrote in the Economic Review (Third Quarter, 1995) that, “Because the United States is dependent on a steady flow of foreign capital to finance its current account deficit, a shift in market sentiment by private investors poses a risk to the U.S. economy. If private investors become reluctant to acquire dollar securities, foreign monetary authorities [can] take up the slack and increase their holdings of dollar reserves.” Extrapolating back to the market, foreign investment exerts a stabilizing influence. When our economy takes a downturn its really great for us that global investors (including sovereign nations) still see the United States as a good bet. Its great that China purchased 10% of Morgan Stanley last week. But some people get worried about China owning Morgan Stanley (just as an example.)

There are some genuinely scary overtones. Satoshi Kamoyashi in his May 24th piece in The Economist, quipped, “the last time governments were this involved in sinking money into private assets, the process tended to be called nationalisation.” However, with US GDP at 12 trillion, total value of traded securities at 50 trillion, and global value of traded securities at 165 trillion, the 3 trillion total of all sovereign wealth funds is not economically significant. Their impact, while symbolically great, is nothing to be afraid of.

George Will (in his Post column on February 3rd, 2008) argued just that, writing, “Remember the patriotic ruckus in 1989 when private Japanese investors bought Rockefeller Center? Remember the frenzied opposition two years ago to the attempt by a company owned by the government of Dubai to become the operator of some U.S. ports?…. Calmness, combined with vigilance, is sensible.” But there are potential political ramifications that go far beyond “Perror” (patriotic-terror) when foreign investment extends into the nations boardrooms.

The last ten years have shown us that individuals and small groups can bring down national institutions. Enron, Worldcom, Barings, and now Societe Generale have all been hit. What happens when some crook does something, or doesnt do something, that really hurts our nation? How would we have responded if Ken Lay had been Chinese or Arab? What if the impact is worse than what Lay did? Our fear should not be investor abuse of power, but our own xenophobia.

I believe there is no cause for actual concern that bad things happening will be caused by foreign governments, but bad things WILL happen. And at the wrong time, in the wrong place, you can bet that the right foreign nation will take the blame. All of this foreign investment does grant these nations influence in corporate governance which, over time, will impact personnel.

There is probably nothing to fear from foreign nationals owning or running our companies. But we should fear our own rage. When trauma – even of relatively insubstantial size – hits a sweet spot, history shows that the results are catastrophic.