Week ending 2020 May 10th: Mother’s Day Cake and Inverted Pyramid

Food:  Mother’s Day cake

My daughter made her first cake today, to celebrate Mother’s Day for my wife.  She did the flour sifting and measuring and stirring etc.  Recipe was of course provided by her mother.  The banana walnut cake was actually quite nice, with loads of walnut and bananas thrown in.

Love:  Jouneying as a family

A friend shared his son’s recent appointment to a senior role in an insurance firm in the USA.  I thought back to his journey:

1. He is Vietnamese and fought the US military during the Vietnam war and literally lost a limb ;
2. After the war, he stayed back to rebuild his motherland, and was well-rewarded working for MNCs;
3. Having attained sufficient financial means, he sent his children to the USA for higher education;
4. Whilst there, the children not only completed their studies, became professionals in their own right, but also took on American citizenship;
5. My friend then retired and joined his family in the USA, becoming a green-card holder himself.

I congratulated him and his family for having come this far.  He commented that “it was such a hard and long journey.”  I replied that “the important thing is the family journeyed together, and reached a good destination and going to another better one.”

I am sure each family will face different challenges, many less dramatic than that my friend and his family experienced.  My wish for my family and friends is that whatever the challenges may be, the family journeys together.

Growth:  Media Recording

For the second time in two months, I found myself having to take videos of my daughter’s presentation to submit as her school assignment.

I took the first one using a mobile phone.  Though it was passable for a school assignment, the quality differed too much from the videos I had seen on YouTube.  In particular, the audio sounded very distant and noisy.

For the second video, I did some research about microphones, which eventually led me to FocusRite Scarlett 2i2 Studio.  So I spent a large part of the weekend on a self-directed just-in-time crash course on using the hardware and associated software, such as Pro Tools First, Audacity and OpenShot.

I am not sure whether my daughter’s teachers intended for their students’ parents to pick up such media recording and editing skills.  Putting on my growth mindset, I can certainly see many applications for the skills, not just for my daughter’s assignments, but also my own projects and hobbies.

Investment:  Exter’s Inverted Pyramid

Since the launch of infinite QE in 2020 March, Exter’s inverted pyramid has resurfaced.

In this representation, gold is the safest asset class, at the tip of the inverted pyramid.  The widest segment of the pyramid at the base is now taken up by derivatives – US$1.2 quadrillion of it.

This runs contrary to Warren Buffett’s argument, which is essentially that gold is non-productive, and is no match for share of a business that can grow its cash flows year after year.

I did a quick check about gold bullion by visiting my local bank branch to ascertain supply.  It turns out the bank had run out of higher grade Canadian Gold Maple Leaf coins (99.99% gold), though it still has stock of 99% gold bars.

Where they disagreed about gold, Exter’s reasoning as applied to derivatives seem to me to be largely in agreement with Buffett.  I have no doubt bankers who create and sell derivatives had made and will likely continue to make bundles of money for their employers and themselves.  The question I think relevant for regulators and governments is – must the public at large, who make no such money, continue to pay the cost of such “entrepreneurial activities”?  My cynical take is similar to the private equity argument last week: as long as these bankers continue to wield influence over financial institutions, plebians should expect to keep paying for the explosions of their creations.

Awe:  Lucky imaging

This is the first time I heard of the term.  It is a astronomy photography technique that involves acquiring multiple exposures of the target and only keeping those segments of an image where the turbulence caused by the earth’s atmosphere is at a minimum.  Scientists applied this to Jupiter, and we have a stunning picture of the planet.  Prior to this, the images I had seen of Jupiter reminds me of a colourful giant marble.  The lucky imaging makes it look more like a burning molten golden ball.