Theremin and his bug

I remember this story (possibly revealing my advanced years here) whenever the US and the USSR would beat each other over the head about spying. This sort of thing came up in my lifetime specifically when the “new” US embassy opened up in Moscow and the US government had to pretty much rip it all apart because of bugs in the structure.

You’ve gotta love the Soviets:

Upon arrival in Leningrad, Theremin was imprisoned, suspected of crimes against the state. He found himself working in a laboratory for the state department. This was not an unusual situation. Aircraft designer Andrei Tupolev and missile designer Sergei Korolyov were two of many others who faced a similar fate.
It was during this time as a prisoner that Theremin designed his listening device.

The best part of the design was that

 It was a passive resonant cavity device, containing no batteries or other power source. It consisted of an antenna and a small cylinder.

And what was Theremin’s other claim to fame?  He designed the instrument that made the Star Trek theme song…

 

Looks like Barrons has discovered Bangladesh…

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Bangladesh RMG Factory

Barrons’ Devendra Joshi seems to have discovered Bangladesh.  Cue rueful smiles from anyone who’s tried to sell Bangladesh and been rebuffed by people who would  have rather invested in (I shit you not):  Kurdish oil companies, Ukrainian debt, Greek debt…

A lot of the stuff he says are blindingly obvious to regular denizens of frontier markets.  Nuggets like,

Remittances provide a source of income for many families…

…with a gross national income per capita of USD1,046, Bangladesh broke into its “lower middle-income” category in July 2015. …

But I have more fundamental problems with this report:

  1. He is focusing on equity plays based on the undeniably good macro story.
    1. I have found it well nigh impossible to properly correlate the two as an investor.  I think there probably still are quotes lying around from Soros rueing how difficult that play really is.
    2. It is actually doubly difficult in Bangladesh because the equity market doesn’t reflect the powerhouses of the economy.  The really well-run companies are very closely held public or completely private.
    3. Oh, and let’s not forget that the banks, some of the largest bloc holders of equity, are being forced to offload their equity holdings per Basle rules.
  2. He is talking up the consumer story.  Everything consumer I have found in Bangladesh is focused on the affluent or super-affluent consumer in Bangladesh.  The few who do cater to middle class consumers (where the real long money is) are
    1. private like Square Food and Beverage.  Great products and consumer brand image.  You could play through the “parent” Square Pharmaceuticals but that is a market darling and they don’t need outside money.
    2. bloody dangerous like Pran Foods.  Hugely profitable, a darling of foreign investors like the IFC but a disaster waiting to happen, considering huge debts and a tendency to play fast & loose with product quality
  3. He does like the banks.  That’s not such a bad idea, only (as he rightly points out) they have looming NPL bombs.  However, the good banks (and the bad) are running up against Tier I & II stoppers and quiet a few of them have asked us to raise funds.  You’d be surprised how may people are interested in that kind of paper….
  4. He doesn’t mention the RMG sector much.  Ready Made Garments (factory disasters notwithstanding) manufacturers are the country’s growth engine.  They are almost all privately held and, unless you want to buy Square Textiles, the public ones are not worth the time.  Just one, Mohammadi Group run by Rubana Huq, has revenues in the USD 200 million range and is completely private.

Of course, if you really want to make money in Bangladesh, you have to do it the “old fashioned way:” by investing in proper operating companies that make real products.  Call me if you care…

How news is really made

Reporters always warn me about the not-so-polite fiction that is “impartial” news reporting.  They also warn that you really shouldn’t try to figure out how news is made if you get outraged quickly.

The media scrum post San Bernardino shooting is a case in point.  As Politico’s Jack Shafer says,

The sensationalist footage was enough to give even a First Amendment absolutist pause as MSNBC’s camera made it easy to read the name, address and other information from a driver’s license.

 

Now BJP MP’s have to get sensitive…

The BJP is now asking MP’s to avoid making “provocative statements” because they

 are being used by the anti-BJP forces to deflect the attention from Prime Minister Narendra Modi’s development agenda.

I suppose the recent poll defeat in Bihar has alerted them to the fact that acting like jerks and assholes is not always a good idea.

USAF report on the MSF Kunduz fiasco

I asked a former UN official and human rights lawyer about MSF’s actions post attack.  His response,

“Do they have grounds to ask for a Geneva Conventions hearing?  Yes they do.

Will it give them anything extra? No”

The MSF Kunduz Hospital attack report by the USAF is now out.  It reinforces essentially what the USAF, the US force commander in Afghanistan and the US president said.  Possible confirmation bias in my case but the fog of war strikes again.

This is what you get when,

The defeat of an adversary is rapid, relatively painless, and above all an outcome of the advanced technology fielded by U.S. forces. In other words, official U.S. thinking about future battles is mired in fantasy.

 

Background: Buffett and Investing in Indian Companies

Personal Note:  As can probably be guessed from the paucity of recent posts, I have been rather busy trying to set up a new partnership.  So, though there have been a lot of things that have caught my attention, I haven’t been able to post much.  I decided to take the medicine and do a few short posts when I get the time.

James Lamont had an interesting piece — quite a while ago — during Warren Buffett’s visit to India.  Buffett was really there with Gates for his philanthropic work Continue reading “Background: Buffett and Investing in Indian Companies”

Background: What is the Intrinsic Value of a Financier?

The question actually came to me last weekend at a party when an Englishman I was talking to said “Good Riddance” on hearing that BlueCrest had moved headquarters from London to Geneva.  I actually partly agree — probably for the first & last time — with Michael Farmer

“If one is a citizen and your country’s having a tough time, you pay your taxes and that’s it – although rather reluctantly if they are not spending it wisely,” Mr Farmer told the Financial Times. Continue reading “Background: What is the Intrinsic Value of a Financier?”