The future decides the past, the most beautiful curve and remove before flight

It's been a long time since I last wrote something. And no, it's not the unfolding of the Greek drama that inspired me now, it's the movie at the bottom of this blog. But to keep with tradition I'll start with the Greek drama.

Since 2010 when the Greek crisis errupted political forces have done everything within their power to offset the economic and financial reality and keep Greece afloat and in the euro. Five years of imposed actions on Greece has not saved the country but it has devestated its society, threw a big part of its population into poverty and has wasted a generation. The economic parameters of the country are worse than that of a country at war. Young potentials have long fled to countries of hope. Regardless of today (or tomorrow) bringing a political solution, one has to question whatever happened to the European ideal of solidarity. Is this the Europe that we ahve all been working towards? To top it all, it becomes increasingly difficult to find media reporting in a balanced way about Greece. It's easy to find the unexceptable extravaganza instituted in Greece since decades mostly for the happy few. Just do a simple google search and the results list will overflow. It's also easy to find personal attacks on various political leaders. But a clear unbiased stock-taking article of the actual situation? It exists but it's a rare find.

Something else that threw me over the past weeks was this bit of news: Scientists show future events decide what happens in the past. Luckily it's about quantum physics and thus not what we experience in our every day life (I hope!). The digital journal reported: "An experiment by Australian scientists has proven that what happens to particles in the past is only decided when they are observed and measured in the future. Until such time, reality is just an abstraction." You can read all about it here.

Last week I was in Le Bourget having a rather busy week. Two pictures stood out for me: the most beautiful curve in aviation today (it's the Airbus 350 winglet)

and a picture tweeted by @AirbusGroupLIVE: Paris Air Show as seen from space! Don't look for me though, I was stuck inside most of the time...

Last but not least I came across this movie. It's a testimony to piloting soft skills: surprise factor, assessing the situation, taking the correct action, land safely and... never ever take off without a thorough walk around!

The Greek drama, all eyes on the Brazilians and the gravitational law of money

I’m writing this as the Greek drama is unfolding with new twists to the plot as days pass by. The Greek drama started about 4 years ago when the then government came clean and said they had cooked the books. So one may argue that the mess they are in they have brought onto themselves. You could also argue that the other EU countries knew perfectly well that the Greek accounts were doctored, didn’t care less and accepted Greece as a euromember anyway, so we are equally to blame. Fact is that since the dirt hit the fan in 2011 the remedy imposed on Greece didn’t work. On the contrary, it has devastated the Greek society. So when I saw a tweet from Tsirpas just before the start of one of the Eurogroup meetings saying "At tomorrow’s Eurogroup mtg, @yanisvaroufakis will be representing #Greece’s 1.5 mil unemployed, 2.5 mil poor & 300K young who moved abroad", I must admit that I understand where he is coming from. That’s not to say that I understand where he is going, but when you just won the elections with a landslide victory and subsequent polls show that 75% of the population is backing the stance you take towards the EU, it's a legitimate question to ask where the EU gets the authority from to tell Greece’s elected politicians they should turn back and tell their voters and supporters that all that campaign rhetoric was just a bit of fun but they weren’t actually serious and that they’ll continue on the very same path that their predecessors and the EU have led them on ie directly into poverty and social destruction.

Back in the aviation world we’ve seen two first flights that have been rather underreported. On February 6, the Dassault Falcon 8X lifted off. This top of the range executive jet is destined for business jet operators, governments, companies and the happy few.

A couple of days earlier on February 3, the Embraer KC-390 took flight for the first time. It’ll be interesting to see if it can make a dent in the market replacing the C-130 Hercules as the world’s most important military transporter.  The C-130J isn’t selling much anymore, the A400M is a size bigger and frankly no one can be enthusiast about the sales so far. So all eyes on the Brazilians!

When driving home from a meeting the other day I heard Keith Ayers on the radio and that brought a big smile on my face when I heard the lyrics "Your money goes back to the rich". I guess you can call this the financial gravitational law. Once money reaches a certain critical amount, it develops its own gravitational field that attrackts other money. That gravitational field is a bit different from the one we know from Earth because the financial gravitational field is infite. The Earth's gravitational field reduces with the  distance from Earth and when you get out of its reach you experience no pull back to our planet anymore. You can also accelerate to escape speed, a speed high enough that spins you outside the Earth's gravitational field. The financial gravitational field is omnipresent. It does not matter where the other money is located, all money is attracted. As a result of that infinite financial gravitational field there is also no escape velocity. So you just have to accept which way your money is heading whilst listening to “Money Money Money” and singing aloud:

Ooh, money, money, ooh, money, money
Where does it go?
Down in some bottomless ditch
Ooh, money, money, ooh money, money

Guess you all know
Your money goes back to the rich, la ti da
Your money goes back to the rich

https://www.youtube.com/watch?v=7WbJlXz2Tdk

Swiss surprise, broken laws and a pink Learjet

I know it has been ages since I blogged. The developments of the past weeks and especially yesterday compel me to draw your attention to the events. And no, this blog isn't about terrorism. So what am I referring to?

Yesterday the Swiss central bank let the CHF loose. Finance you say? Yes finance but with global consequences. You all know that since the 2008 financial crisis, central banks worldwide have thrown all care and common sense out of the window and are using their own equivalent of nuclear weapons to keep their currencies and economy adrift. The US and Japan have created enormous amounts of money (and still there is no inflation, isn't that strange), the ECB reportedly is on the brink of going down the same path next week, and no one is blinking an eye. Except for the Swiss. They blinked yesterday.

During the euro-crisis many were running out of the euro into the CHF which led to the CHF quickly becomming more expensive. As an expensive CHF is problematic for the Swiss economy, the Swiss central bank interfered and decided to keep the Euro/CHF rate at 1,2. For years they have done this by constantly interfering in the exchange rate. And yesterday they stopped.
This was the result:

On one day the CHF became 15% more expensive, so the Swiss export suffered suddenly a 15% hurddle. Just check the Nestlé shares what it means.

So why did they do this? Why does a central bank suddenly punish its own economy with 15% in one day? They must have a very good reason, they surely know something we don't. Some say it is because next week the ECB will start the printing press and the Swiss don't want to follow suit (which they would have to if they wanted to keep the CHF at an unchanged 1,2 exchange rate). I don't know if that is the reason, future will  tell. Fact is that the Swiss move took everyone by surprise. Yesterday we were all turkeys (Taleb afficionades will get this). Even the IMF was not informed and quite appalled that they were not. Here are some quotes from Lagarde:

“This was a bit of a surprise…I find it a bit surprising that he (Swiss central bank chief Thomas Jordan) did not contact me, but you know, we’ll check on that.”

According to Lagarde, Thomas Jordan may not have warned European Central Bank chief Mario Draghi and others about the move, either: “I would hope that it was communicated with other colleagues from central banks. I’m not sure it was.”

There you go, Switzerland surpised the world.

Some other development that is underreported in the news (and that is an understatement) is the situation in Greece. Next week they have elections and the party that is likely to win has said that they will reform taxes and renegotiate the national debt. Result: people don't pay taxes anymore. Why should they if the new government would abandon those taxes? It surely is a bit silly to still pay them now. Secondly, if Greece would leave the euro (I know euro politicans keep on telling that the law forbids it - but hey politicians never break laws do they) then new Drachma would quickly and sharply devaluate. So any Greek who believes the Grexit is a possibility what does (s)he do? Go to the bank and withdraw all savings in euro. That's what I would do too. When banks run out of cash as a consequence they can ask the ECB to use the ELA (Emergency Liquidity Assist). That's what Greek banks had to do at the height of the eurocrisis and two Greek systemic banks asked for the ECB ELA on Wednesday as well. 3 billion € was withdrawn in December and almost the same amount already this month.


So there you go: Swiss lets its CHF appreciate with 15% in one day, the ECB may start money creation next week, and the Greeks are preparing for the possibility of a Grexit. But do we read this in our national press? Nope. Does anyone care to explain the consequences of this on a global, European or local level? Nope. Does someone explain what it means for our personal wealth (irrespective of the size of that wealth)? Nope.


But lets end this blog in good tradition with some aviation stuff. I came across a movie which made my eyebrows raise. It's a Learjet cutting a ribbon being held up by two guys on flyboards. Crazy crazy crazy. Just watch. But the thing that threw me most is: who in his right mind paints his Learjet pink???