Friday, July 31, 2015

Traveling: California Redux

(Drivebycuriosity) - Oh California! Myriads of movies, songs, books & pictures have been shaping my impression from the Western US state for decades. This month my wife and I had a 9 days vacation in San Francisco and the surrounding area - my first visit in California. The trip gave me the opportunity to compare the reality with my fantasy.

The most impressed me the gorgeous landscape. California is a stripe of land between the Pacific Ocean and the Rocky Mountains and shaped by both. The combination of mountains and sea created a lot of bays which structure San Francisco and the area around the northern Californian metropolis.

California can be proud of its nature which seems to be well preserved. I was fascinated by a red wood forrest that we saw in the Armstrong Redwoods State Natural Reserve in Sonoma county, a wine growing area some miles north of San Francisco. In a canyon, protected from strong winds, grow majestic trees, the tallest of them measures 310 feet (94 m), the oldest is estimated to be over 1400 years old (wikipedia). Wow!

The rocky coast is another jewel of nature. On a trip southward to Santa Cruz we enjoyed the wild nature along the coast line. Some of the little bays where without people, so some places looked like untouched nature. We saw fascinating rock structures, developed over millions of years, and blossoming wildflowers and other plants, which have been adapting to the harsh sea climate. We also spotted harbor seals, who were taking a sunbath to warm up from the cold ocean, and colonies of cormorant birds, cranes and pelicans.

North of Montega Bay the coastline is even wilder. The waterfront is shaped by steep cliffs and huge rocks in the water - a terrific scenery.


                                                                  Californian Dream

Above you can see a series of pictures I shot in a almost deserted little bay north of Mondega Bay. The couple, who apparently enjoys the Pacific evening on the beach, could represent the Californian dream.


Close to Santa Cruz,  75 miles south of San Francisco, we found some bays & beaches which were more densly visited. There we could see a lot of surfers who were riding the powerful Pacific waves. On one of the surfer beaches we saw a board with surfer rules, which looks very German to me. Do the surfers follow really the rules?

Santa Cruz, a former Spanish mission,  has a very laidback atmosphere. The city, population about 60,000, is  a magnet for hippies who might be attracted by the liberal Californian climate. And you can also watch beach volleyball there of course.


                                                     Law Of Unintended Consequences

San Franciso herself comes up to the expectations. The northern Californian metropolis is a unique, beautiful city. The place sits on the northern end of a peninsula. She is flanked in the West by the Pacific Ocean and in the East by the San Franciso Bay. The face of the city also is structured by a lot of hills. Some streets have adventurous steep slopes.

Contrary to New York City there are not many high buildings as a result of very strict building restrictions. Gabriel Metcalf, a local expert for urbanism, reports, that the progressive city government allies with house owners (the "not-in-my-backyard-crowd") and slows down the construction of new homes which leads to a "devastating affordability crisis" (citylab). People, who work in the nearby Silicon Valley, and other high income residents are replacing low- and middle income renters. A typical example for the law of unintented consequences.

The same policy also leads to an underdeveloped public transportation system. There is no subway network and the jammed buses are running infrequently. You need a car if can afford to live there.

I was surprised by the chilly  & windy climate, even in he midst of July the temperatures fell often into the 50s F (10-15 Celsius). San Francisco  makes a sleepy impression, there is not the "huzzle and buzzle" you can see in New York City and many restaurants close early in the evening.

A real setback are the crowds of homeless people on streets & places. I have never seen so many stranded, stoned and metally disturbed people on one place. Sometimes it looked like that the streets belongs to them. Maybe these people are attracted by the very liberal & progessive policy of the city. Therefore San Francisco has an odd mixture of nouveau riche and third world.

San Francisco´s vegetation benefits from the mild winters (Mediterranean clima) and the often foggy summer day. You can see there a lot of lush gardens.

I looks that the people there enjoy the community of others in the nature. This park in the middle of the city is apparently very popular and maybe also a part of the Californian dream.

The picture above shows the San Franciso bay east of the city.

But sleepy San Francisco has at last one lively district: The gay Castro area - another symbol of the alternative culture.

San Francisco`s ubiquituous street art is another sign of the liberal progressive climate there.

The architecture looks often color- and playful. I made the pic above in Sausalito - a small harbourplace north of the San Franciso Bay and embarkation place for the Ferry to San Francisco.

                                                            Green Politics

Everywhere I could see the signs of the liberal & very green Californian politics. Gasoline is very expensive there. In the moment of writing the average Californian gas price at the pump hovered at $3.817 (national: $2.697). This is the result  of high state gas taxes and strict reguations, which  enforce the use of an expensive gasoline mixture (latimes). Therefore I saw so many Volkswagen and gas saving small Asian verhicles on the streets.

Solar panels are also very popular there, which makes sense thanks to the sunny climate of the state.

While traveling on the highways & freeways around San Franciso I noticed that there are not many trucks. Grown up in Germany I was used to convoys of heavy vehicles which usually clog the right lane and often cause traffic jams. But the economy of this area is dominated by the information technology of Silcon Valley. There is no need for trucks which transport automoible parts and other machines around the clock. So the local economy is one of the reasons that this area is so green.

The Californiana seem to be very disciplined. Here a pic of commuters standing in line at one of the rare mass transit platforms.

The Californian life style includes a lot of active sports of course, I could see  runners everywhere.

Conclusion: The San Francisco area is a fascinating travel destiny with a gorgeous and wild nature. The place is also expensive, thanks to an aspiring industry (information technology) and "progressive" politics. It is a bit sleepy, but charming. We will come back, California.

Tuesday, July 28, 2015

Stock Market: The China Crash Revisited

(Drivebycuriosity) - There is a lot ado about the crash on China´s stock market. But the Shanghai composite, a gauge for China´s stocks , is still up 13% year-to-date and holds still a gain of 72% for the recent 12 months. Most people who have been investing there are still sitting on solid gains.

And the talk about China´s faltering economy doesn`t stand reason. The country has already created 7 million jobs this year (businessinsider). In June industrial production grew 6.8%, faster than in May (plus 5.9%), and retail sales growth accelerated to plus 10.6% (May 10.1% (foxnews). This is partly a response to reduced interest rates and other measures to rekindle economic growth. China is also benefitting from the sharp fall of oil and other commodity prices.

The facts show that China`s economy is much healthier than the media in the West wants you to believe. I think, the "China crash" will soon be forgotten.

Economy: The End Of Capitalism?

(Drivebycuriosity) - "The end of capitalism has begun", claims the British paper "The Guardian" (theguardian). The text looks like a wet socialist dream. Paul Mason, a Marxist and author of this article, declares that information technology (Internet, software, cloud computing and more) will destroy capitalism and replace it by "postcapitalism".

I disagree. Capitalism is just changing its face, as it has ever done, by adapting and creating new business models. Information technology leads to a stronger and more efficient capitalism. You can see this on the stock market. The Nasdaq 100, which represents the US information technology, hoovers close to an all-time-high. Stocks of companies who belong to the information technology sector, like Apple, Google, Amazon & Facebook, have been climbing much stronger than the rest of the stock market, leading to enormous market capitalizations. Apple, who`s iPhones & iPads are in the heart of information technolgoy, has now a market capitalization of $700 billion, around twice of the company value of Exxon Mobil and is the largest public company in the West.

Changes in information technology are giving birth to new and very successful capitalist business models. Take for instance Airbnb. The company, which wouldn`t be possible without advances in information technology, owns an app that allows people to become entrepreneurs. The partners of Airbnb use their own - or rented - flats as capital to earn money. Their customers also benefit because they can reduce their travel expenses by renting relative cheap Airbnb rooms. The successful business model turned Airbnb, founded in 2008,  already into a huge global corporation with a value of maybe $24 billion (wsj).

The success story of Uber goes similar. The company´s app permits people to book temporary cars & drivers. The partners of Uber uses own - or rented - cars as capital to earn money. The popularity of Uber is fast rising because their customers save a lot of costs. Uber, founded in 2009, is now valued at around $50 billion (fortune).

Facebook maybe the poster child of the IT capitalism.The network is increasingly used by companies. They need the network and its huge number of users to find new customers and to communicate with them. Facebook gets in return high & rising revenues which already lead to market capitalization of about $ 270 billion.

The rise of Facebook, Airbnb, Uber, Snapchat (messaging app), Square (mobile payments) and many other post-2000 companies shows that capitalism is getting stronger - even that it looks different than 10 years ago (ritholtz).

Yes, Mason is right, the sharing economy is rising. But people, who want to sucesfully share something need networks, websites, search engines & apps to do so, and the owners of the networks, websites & apps earn a fee which can culminate to gargantuan sums as the examples of Google, Facebook, Airbnb and others show.

Yes, Mason is right, the costs of information are falling thanks to new technologies. But this trend makes it easier to create new business models & companies. Advances in the information technology spur progress in robotics, self-driving cars & trucks, 3D printing, biotech & more., IBM, Apple, Google and other companies offer data storage and processing either for free or for low fees, giving everybody access to a network of supercomputers (cloud computing). Companies & persons can process and store huge amounts of data without spending much money for own data centers.

Netflix for instance benefits strongly from falling information costs because downloaded movies are just a set of informations. Amazon, Alibaba and other e-commerce-companies are growing fast because the shrinking information costs attract huge number of customers. And falling costs of information strengthen competition (the competitor is just a thumb click or app away) - making capitalism more efficient and flexible.

Capitalism has a long history of adapting to new technologies. In the Renaissance Banks - and modern corporations - became possible because the invention of printing & accounting (both advances in information technology) made it possible to administer large financial & trading companies. Later capitalism adapted to the agricultural & industrial revolutions and got stronger. Now capitalism is taking advantage of the new technological revolution (driveby).

Long live capitalism.

PS For illustration I used a work by digital artist and painter Yoon Lee - a metaphor for the exponential growth of technology and information (dailyserving).

Sunday, July 26, 2015

Books: The Paying Guests By Sarah Waters

(Drivebycuriosity) - Frances has a problem: She loves Lillian, but she lives in England, shortly after WW I and Lillian is married. "The Paying Guests" by Sarah Waters describes the dramatical consequences of this love story (this is a spoiler free blog) (amazon).

The novel is one of the best books I have read in the recent years. I think if Alfred Hitchcock would be still alive he would love this book and would turn it into a great movie. Waters delivers an intense psychological study and describes the characters vividly & plausibly. The book is precisely & analytical written - but also entertaining and  kept me curious till the ending of the book. Thanks to the clear and fluid style the reader immerses deeply into France´s world, suburbian London in the late 1910s.

The plot changes the character several times over the course of the book, which makes it more interesting. It is sometimes an economical report, then a romance & steamy erotical novel, a dark thriller and a court drama. Waters writes about social aspects, especially the life of the declining English middle class, shortly after WW I, and describes painstakingly how a low income home has functioned in these times & place, she also philosophizes about relationships, conflicts of interest and about moral fault and guilty conscience.

Patricia Highsmith meets Anaïs Nin - well done!

Saturday, July 25, 2015

Stock Market: Sentiment Overtrumps Reality

(Drivebycuriosity) - Last week the US stock market dropped about 2 %. Depending to whom you listen the fall was caused by "worries about a weak global economy" or by "expectations that the Fed will hike her interest rate in September".

I think the fall is just another tribute to the pessimistic sentiment. Many hedge funds have been betting on falling stock prices for months. They do a lot of fear mongering, spreading pessimistic rumours, overblowing disappointing news and dismissing positive facts. The media, which live from bad & shocking reports (man bites dog), compliantly spreads the scare mongering. Everyday you can read some crash & recession predictions.

But the economy is still doing fine. Last week we learned that the US jobless claims sank to the lowest level since 1973!, existing home sales grew with a solid pace and maufacturing picked up  (ritholtz businessinsider). The earning season had a sold start: More than 75% of the S&P 500 companies have beaten Wall Street profit predictions so far, reports Bloomberg (bloomberg  bespoke). Bellwethers like Starbucks, Visa, Google, Amazon beat the expectations handily.

If the Fed will raise interest rates soon, they will do it very modestly, because Yanet Yellen & Co. are well aware of the risks. And more important: Oil and other commodities got cheaper again, reducing the costs for the companies and leaving more money in the wallets of the consumers (driveby).

I am confindent that last week´s drop was just another irrational blip and will soon be forgotten.

Thursday, July 23, 2015

Contemporary Art: A Tear For Sophie & More @ William Holman Gallery, New York

(Drivebycuriosity) -It is summertime in New York. Everything is a bit slower than normal. But the gallery scene goes on. The William Holman Gallery in Manhattan`s Lower East Side (65 Ludlow Street wholman) has a new group show (through August 26, 2015). I present here my favorites from the exhibition, a very subjective selection as usual.

On top of this post you can see Tom Judd`s "Roadside Attraction #I" (2008, Oil and Collage on Panel). I like the colorful vehicle in a dessert setting which would fit into a Tarantion movie or a very modern Western.

Peter Bonner`s "A Tear for Sophie" (2012, Oil on Canvas) is an orgy of colors which reminds me of the class in acrylic painting I recently took.

I also like John Cunningham`s, "Brooklyn Studio" (2015) & "Fourth Avenue Nocturne" (2010), both oil on canvas). Both impress by their wild expressionist style.

Michael Davis` gruesome "Werewolf" (2015, Charcoal on Paper) delivers a real contrast to the colorful paintings above.

Liene Bosque`s Castello Plan II (2013, Plaster and Vinyl, 20 x 19 x 5 inches) looks like a cute Manhattan.


Tuesday, July 21, 2015

Economy: The Oil Conundrum

(Drivebycuriosity) - The economic development these days is puzzling. Oil is much cheaper than last year, but the economy doesn`t respond much and US retail sales are still sluggish. Why did cheaper oil not rekindle the economy?

I think there is at last a partial explanation for that: The oil price reduction did not arrive at the consumer yet - at least not fully. The price of oil (Brent Crude) fell 50%, from $116 to $58. But the gasoline price at the pump dropped much less. According to the US automobile association AAA the average US gas price is today $2.751 (last year: $3.574) (fuelgaugereport.). This is just a reduction of 23%. In California, where most of the US car drivers live, is the situation worse (aaa): The average gas price there is $3.872 (last year: $4.044). This is just a minus of 5%.

The meager gas price reduction is not just disappointing. According to the bank Morgan Stanley consumers ignore the gas price drop, because they believe that the price reduction is just temporary (businessinsider).

Why did the gas price fall less than the price of oil? There are a lot of explanations for that: A part of the gas costs at the pump are tax payments, which didn`t fall and are caused by regulations, like the mandatory admixture of ethanol. Both, taxes & regulation, are especially strict in California (latimes).

But, I think there is an additional explanation: The stickiness of prices. Refiners & gas stations are reluctant to reduce prices. It needs time that the competition forces them to adapt their prices to the lower costs. The rising seasonal gas demand in the summer time also stood against price reductions.  There might also be some speculation that oil prices (their costs) will rise soon.

I believe that the price for Brent Crude will stay around $60 - and might even fall below $50 - because the global oil production is much higher than the demand for oil (driveby). Today the refiners enjoy high profits because of the huge difference between crude oil and gas prices. The high profits will motivate them to produce more gasoline which should squeeze gas prices down.

Therefore I expect that gas prices will go down sharply in the coming months - faster than seasonal usual. Next winter the average gas price at the pump could fall below $2.00 - which would conform to the oil price reduction.

Hence falling gas prices should stimulate consumer spending in the coming months and rekindle the sluggish economy.

Movies: Self/less

(Drivebycuriosity) - What if your are old and sick, but some advanced technology puts you into a young and healthy body? Science Fictions authors had played with this idea and came to interesting solutions. The movie "Self/less" is the newest version of this topic (imdb). The mind of a billionaire with terminal cancer gets transplanted into the body of a young man and starts a new life with leads to a series of complications (this is a spoiler free blog).

The mind-transfer idea could have lead to a very interesting movie. But it seems that the producers have been undetermined whether to make a) a science fiction movie  b) an action thriller c) a hip-hop/basketball flick d) a family romance. "Selfless" meandered between all these genres, sometimes it looks like a bad copy of the "Bourne" movies, then it jumped into a kind of family Disney entertainment. The plot was unbelievable and the sex scenes were pathetic, produced for an unambitious college crowd.

It`s characterizing that Ryan Reynolds, who had made his name with action films and could easily be confused with a football player, has the leading role. Solid actors like Ben Kingsley and Matthew Goode were wasted in this film.


Monday, July 20, 2015

Culture: A Visit @ de Young Museum, San Francisco

(Drivebycuriosity) - San Francisco has at least two gorgeous museums. I reported already about my visit @ the Asian Art Museum (driveby). Last Wednesday my wife an I saw the de Young Museum (deyoung.).  As many other American museums this institution is funded by private money, donated by wealthy persons and families, contrary to the European museums, which are usally public, meaning government owned.

The de Young has a fascinated mixture of more or less classical works with contemporary paintings & sculptures. Above you can see "The Last Civil War Veteran" by Larry Rivers (Oil on canvas, 1961) followed by "Lady in Black with Spanish Scarf (O in Black with Scarf)" by Robert Henri (1910, oil on canvas).

                                               The Look Of Cinema

I also enjoyed "Portrait of Orleans" by Edward Hopper (1950, oil on canvas). I believe this painting and other works by the great American master influenced many movie directors and shaped so the look of cinema today. The expressionist "Bathers" by Max Pechstein (1917, oil on canvas) is also an eyecatcher. I want to join them!

"Pierre-Edouard Baranowski" by Amadeo Modigliani (1918, oil on board) is one of most elegant works by the Italian painter.  "The Sonata" by Irving Ramsey Wiles (1889, oil on canvas) enchants by its charm.

                                                     Fiction Replaces Reality

Many of the contemporary paintings in the de Youg collection remind me of my recent class in acrylic painting. Jeffrey Tolbert, our teacher, claims that artists don´t replicate the reality, instead they create a fiction. And he really likes power- and colorful expressionist paintings.

Above this paragraph you can admire "Yellow Lampshade" by Elmer Bischoff (1969,  oil canvas).

"Young Girl" by Joan Brown (1962, enamel on canvas) & "Couple" by David Park (1959, oil on canvas) belong into the same category - orgies of color.

Jeffrey Tolbert admires Bischoff`s & Parks` "direct style of paining with vibrant colors and thick wide brushstrokes!  They have an immediacy with their imagery this quite profound and their figures inhabit wild places!!"

Richard Diebenkorn`s  "Nude on Black and White Stripes" (1962,oil on canvas) & "Berkeley No. 3" (1953, oil on canvas) are more examples of this fascinating school of painting.

                                              Catastrophes On High Sea

The de Young also has a temporary exhibition with works by the British painter Joseph Mallord William "J. M. W." Turner, called "Painting Set Free" (through September 20,2015). The artist (1775-1851) influenced following generations by his generous use of paint, anticipating the surrealists & expressionists of the 20th century. I like best his catastrophes on high sea.

Above you can see "Snow Storm - Steam-Boat off a Harbour`s Mouth making Signals in Shallow Water going by the Lead" (oil on canvas)

"Peace - Burial at Sea" (oil on canvas) devoted to the death of a friend

"The Hero of a Hundred Fights" (oil on canvas)

                                                             Green & Lush

The museum has much more attractions of course. One of them is the lovely garden surroundiet by a very green & lush vegetation - with sculptures in it. You can sit there with a glass of Californian Chardonnay -priceless!

Let the pictures speak for themselves