When we are born we know nothing! zero, nada!

From, Too different for Comfort, Louis-Vincent Gave (You can download a free copy for free in gave kal website)

If nothing else, this illustrates the profoundly deflationary nature of
capitalism. Fundamentally, capitalism is about making more with
less. And if possible, much much more with much much less. And
given the Robolution, we may well have entered a period of structurally
accelerating deflation; an ability to produce more and more goods and
services with ever fewer workers.
In his research, Professor Brynjolfsson shows that 65% of American
workers occupy jobs whose basic tasks can be classified as information 
processing. This is frightening as it leaves open a lot of jobs that could
be replaced by machines and/or software. It is this new reality that raises
major headaches for policymakers.........................
And does putting the cost of capital at zero, and printing a lot of money
(the remedies so far espoused by most central banks in their bid to fight
deflation) really help the laid-off Samsung worker, or now-unemployed
nurse, find a job? Or does the zero cost of capital instead accelerate the
trend of replacing labor with capital? After all, if we make capital free,
and labor expensive (through increases in regulations, increases in
benefits etc…), should we be surprised that companies replace labor
with capital?

I have to agree with this well written piece, what can we do against the triumph of the machine? I guess since when we are born we know nothing, we spend the first 20 years of our life just learning the basics. The Computers build on the previous knowledge. next year computer will do everything this year computer does and a bit more. Always compounding!

What can man do? Invest in the Robot factory and do things that can not be done by the computer/Robot. Everything that is non repetitive (Plumber, Personal trainer) and physical (Football player,  dancer, actor) or be in the very complex forefront of research. 
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Leaving for Brazil on business until the 22nd

Stay safe, i hope to enjoy some good weather after a dismal winter in Lisbon!
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How to stop a bad behavior?

Repeated punishment, while it crushes the hatered of a few, stirs the hatered of all…..just as trees that have been trimmed throw out again countless branches

Nassim Taleb, Antifragile

When you want to stop a horse you can not pull the reins forever. If you want to stop you pull a bit and then let go and after a while you do it again…… and the horse comes to a halt! In this book Nassim mentions that if you take small doses of a substance over time your body stays immune to additional larger quantities of it (poison). I guess if you punish to often your kids after a while they became immune. We don't want that.
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What could be the Problem in the World?

Since 2008 financial crisis the world looks different

Why?

The world has almost no growth
Inflation is almost at zero everywhere
Regulation is in bull market
There is a big resentment with people that are doing well
Politicians are in the center of every decision
Tax receipts keep going up, the governments slowly take a bigger share of the pie
Unemployment is still high
There is excess supply of almost everything

News like this one are normal (Today news)

STOCKHOLM (AP) — Truck maker AB Volvo said it plans to lay off 4,400 employees this year as it revealed a 37 percent slide in fourth quarter profits.
Volvo CEO Olof Persson said the job losses, which include the previously announced reduction of 2,000, will affect employees worldwide in group truck operations, as well as in technology, sales, marketing, IT, finance and human resource department

To me the problem in the world is a lack of demand. There is excess supply of almost everything.

What causes this situation?

a)Technology, now a worker operating a machine or a Robot can produce thousands of units when in the past this same man/woman could only produce a few. In the new world not everybody is needed in the workforce.
b)One way to increase demand is to borrow but debt is already to high (Governments & Privates are already over levered)
c)Rates are at zero so the savers are not making money from their savings and are not spending. They get no income so they don't spend.
d)Since there is oversupply of almost everything there are no obvious investment opportunities. Normally a new investment is trying to address a lack of something but today we have everything.....

Who can win in this environment?

I think markets will keep going up, when rates are at zero everything will converge to zero. Dividend yields will fall (Stock's up), bond yields will converge, etc.... Zero is a magnet.
Robotics & Automation will keep replacing humans
Brands will keep doing business
And the big kill small is still in place



For the moment this is the world we live on, i don't intend to fight it.
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Why EM are not Emerging II

EM consumers want the best and the best is in America & Germany. If you want to play EM you have to consider the big multinationals & the big Brands. This graph from the excellent Gave Kal research says it all. Profit growth in Emerging Market companies is lagging big time the growth of EM economies.

I rest my case

A previous entry on the same subject.
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Life is not in our hands

A kid that i hired and that worked with me for most of his life was killed by a car in front of the Office today.

Apparently it was a small touch in his motorbike from a car a low speed but he bumped his head in the sidewalk!

What can we say? This is a kid that travels at high speeds in his motorbike for all his life with no incident and dies in front of the office with a small event.

He was a very good guy one of the best. I could never caught him saying bad things about anyone, he was shy and respectful. A very hard working and a top Surfer. He looked happy with his life.

Life is not in our hands

We need to enjoy and live the most we can. Enjoy friends and family as much as we can. 

we need to be nice. 

we can't get angry with people that we love. We shouldn't get upset with small things. Do no harm as much as we can.

We need to live fully each day. 

It's so good to be alive with good health.

Enjoy this day.
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What is the problem of me going to a Michael Buble concert?

From the Economist

In today’s Russia, oil and gas account for 75% of all exports, compared with 67% in 1980. Although Russia no longer buys grain from America, as it did in the 1980s, 45% of what Russians buy today is imported. Walk around a department store in central Moscow, and it is hard to find anything that is produced locally. The state remains the single largest employer, while its corporations—controlling natural resources, infrastructure, banking and media—dominate the economy.

Well it's not only in Russia that countries import 45% of what they consume, even in my country Portugal people love I-Phones, BMW's and american music. Unfortunately for us there are not many things the world loves about Portugal except perhaps to live here!

Just as a side in January BMW was the most sold car in Portugal for the first time ever, in front of Renault, VW, etc... It's amazing!

I didn't know Michael Buble before this show. He sang music from Sinatra, BEE Gees & Beatles and many others. It's a very good show. I was invited to the 2nd row and i loved it. But my point is that almost no Portuguese musician tours the world and we have almost every week festivals with the best American music (I think he is Canadian). This guy got 2 day in a row a complete full house in the biggest Arena we have in Portugal. The MEO Arena!. That is the problem with EM, people want to buy the best and the best is not in EM.
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