My Amazon Review of William Walker's "If War Should Come:....."

 

War On

 

This is William Walker’s fourth novel about the banker/diplomat/spy Paul Muller, a man who moves in the highest circles of the Swiss government.( Shulmaven: My Amazon Review of William Walker's "A Spy in Vienna.....")  In prior novels we find Muller in Danzig, Vienna, France and Germany, this time we find him in Romania, Turkey, and Finland as he intersects with prewar crises and the start of World War II. Thus, we see those historic events through the eyes of neutral Switzerland. With the war on the great fear in Europe is that of the Russo-German de facto alliance created by the Molotov-Ribbentrop Pact would destroy the West.

 

The novel opens in September 1939 with Muller acting as a representative of the Bank for International Settlements where he takes possession of the Polish gold reserves being transported by train from the Polish/Romanian border to port of Costanza. This is sort of a follow-up to Alan Furst’s great novel “The Polish Officer.”

 

From Romania he gets caught up in the intrigue of Istanbul, Turkey where neutral Turkey is under pressure from Germany and Britain to enter the war on their respective sides. German Ambassador Franz von Papen and his wife who Muller had a dalliance with her in Vienna make a cameo appearance here.

 

The novel ends with Muller on the Finnish border fighting for the Finns in response to Russian aggression in November 1939. Quite a life telescoped into four months of 1939.

 

My quibble with Walker here is that he gets wrong the price of gold, the number of grams in a troy ounce and the price of jewelry in the Turkish bazaar of 1939. My sense is that he used today’s prices for 1939’s. Otherwise I found his latest novel to be a satisfying way to get a sense of Europe at war, but it is not quite as good as his earlier efforts.

For the full Amazon URL see: War On (amazon.com)

 

 

A Discussion with Ambassador Martin Indyk on his Book "Master of the Game"

Ambassador Martin Indyk appeared in a discussion with Jim Falk of the Santa Fe Council on International Relations on March 10th. He discussed his book on how Henry Kissinger engaged in Middle-East diplomacy in the 1970's and the lessons to be learned for today. He also dicussed the current situation in Ukraine. The links for a video recording of the event and my review of his book are below.

Martin Indyk: Master of the Game - YouTube

Shulmaven: My Amazon Review of Martin Indyk's "Master of the Game: Henry Kissinger and the Art of Middle East Diplomacy"

My Amazon Review of Ananyo Bhattacharya's "The Man From the Future: The Visionary Life of John von Neumann"

 

Genius

 

Something was in the water in fin de siècle Budapest. Out of that community came Nobel Laureates in physics Edward Teller, Eugene Wigner and Leo Szilard, the rocket pioneer Theodore von Karman, and the subject of Ananyo Bhattacharya biography John von Neumann. I would note that the book is more a biography of von Neumann’s ideas rather than a full biography of his life.

 

Von Neumann was born into a very upper-middle class Jewish family in Budapest, Hungary in 1903. He was a child prodigy from the beginning and received his math Ph.D. before he was twenty. The then studied engineering and before he was thirty, he authored "Mathematical Foundations of Quantum Mechanics” which integrated Heisenberg’s matrices with Schrodinger’s waves, a monumental accomplishment.

 

But that was only the beginning. He developed Minimax theory and at the Army’s Ballistic Research Lab he became an expert at the trajectory of artillery shells. That led him to the Manhattan Project at Los Alamos where developed the implosion lens necessary for the creation of the Atomic Bomb. He also conceived of stored program computer which had yet to be invented. Indeed, his second wife Klara was among the very first computer programmers.

 

Along the way he coauthored with Oskar Morgenstern “The Theory of Games and Economic Behavior” which revolutionized economics and was found to be very useful in business and war strategies, especially concerning the use of nuclear weapons. After World War II he divided his time among Princeton’s Institute for Advanced Study, Los Alamos’ Weapons Lab, and the Rand Corporation in Santa Monica, California.

 

While at Rand he instrumental in the development of ICBM’s and he came up with the idea of self-replicating computers. In essence he was the progenitor of artificial intelligence.

 

Bhattacharya tells the story of a true genus who also loved to party hard. My one criticism is that several of the science and math parts of the book can be a real slog for the lay reader.

 

The full Amazon URL is at: Genius (amazon.com)

Mr. Zelenskyy Goes to Washington (Via Zoom)

Ukraine President Volodymyr Zelenskyy came to Washington today via a Zoom connection from Kyiv. In a moment that only can be described as pure Churchillian he called upon the United States not only to supply his beleagered country with arms, but also to act like a great power. His video presentation showing the horrors of the Russian bombardment of Ukraine was reminiscent of the Joris Ivens 1937 film "The Spanish Earth" that was made in support of the Spanish Republican fight against fascism. To be sure, President Biden offered up a host of arms, but he remains understandably reluctant, but wrong, to put U.S. forces into the conflict.

There have been several suggestions short of a no-fly zone that can be done by the Administration if it only had the will. The first would be a limited no fly zone in western Ukraine that could be enfored by anti-aircraft missiles based in Poland and Romania. The second would be a humanitarian airlift flying in food and medical supplies to Kyiv, a move analagous to the 1948 Berlin Airlift. Remember in the 1990's President Clinton declared we wouldn't get involved in the Bosnian War until the horrific news coverage forced him to directly act militarily.

The most unfortunate thing about this whole episode is that it was totally predictable. Reprinted below, typos and all, is my blog posted on May 7, 2014.

WEDNESDAY, MAY 7, 2014

Reliving the 1930s

According to aphorism attributed to Mark Twain, “history does not repeat itself, but it rhymes.” I am afraid our generation is reliving some of the horrible experiences of the 1930s. The Great Recession of 2008-09 was our version of the Great Depression. The recent experience certainly was not as bad, but after many decades of plenty, it certainly felt that way.

As the 1930s progressed concerns shifted from the still depressed economy to the rise of fascism and a series of foreign policy crises in Europe and Asia. Instead of Hitler fascism we are now witnessing the rise of Vlad, “The Impaler,” Putin’s version of it. In the 1930s Germany was the revisionist power seeking to undo the strictures of the post- world War One settlements. Today Putin is attempting to revise the post-Cold War settlement established from 1991-1994. His seizure of the Crimea and his attempts to further dismember Ukraine are part and parcel with his strategy to restore the past greatness of Russia. Just like Hitler, he is succeeding.

Why? The West is doing its best to rhyme the failed policies of the 1930s of vacillation and appeasement. Both the United States and Europe want the world go away so they can hide in cocoon of isolation. This is true of factions of both the left and the right of the political spectrum. Unfortunately this policy is a luxury we cannot afford. To paraphrase the Russian revolutionary Trotsky, the U.S. and Europe might not be interested in the world, but the world is interested in them.

Instead of making speeches, our vacillating President should act by imposing real sanctions on Russia, providing direct military aid to the Ukrainian government, increasing rather than decreasing the military budget, moving NATO forces into the front line states on a more permanent basis and take the energy infrastructure steps necessary to wean Europe off of Russian gas. Will President Obama act? The stakes are high! 

My Review* of Nick Timiraos' "Trillion Dollar Triage: How Jay Powell and the Fed....."

 

Bagehot on Steroids

 

Nick Timiraos, the chief economics correspondent of The Wall Street Journal, has written a hagiographic account of Fed Chairman Jay Powell’s role in saving the economy from the lockdowns associated with the COVID-19 pandemic. Hagiographic or not, Powell does deserve kudos for the way he acted with alacrity and boldness in stemming the steep economic decline that the economy faced in March-April 2020. Further, he continued his stimulative policies by making full employment a higher priority than combating inflation. In other words, his goal was to create a high-pressure economy(Shulmaven: The Fed and the High-Pressure Economy)     which in combination with highly stimulative fiscal policies brought the unemployment rate down from its peak of 14.7% in April 2020 to the current 3.8% rate.

 

My title comes from one Timiraos’ chapters where he invoked the central banking policies enunciated by Economist editor Walter Bagehot. According to Bagehot the role of a central bank in a crisis was to lend aggressively against good collateral at a penalty rate. In this case Powell received U.S. Treasury guarantees to lend on practically any and all collateral. That policy along with $120 billion/month of quantitative easing rescued the economy.

 

Timiraos gives credit to Powell for understanding faster than most government officials how devastating the pandemic would be. He was way ahead of a hostile Trump Administration and its public health authorities.

 

In March 2020 I was responsible for the U.S. forecast for the UCLA Anderson Forecast. On March 16, 2020, we published the first interim forecast in the history of the project under the title “The Sum of All Frears,” where we made the case that the U.S. economy was already in recession.(Shulmaven: "The Sum of All Fears," UCLA Anderson Forecast March 2020 Interim Forecast ) We were the first or very near first among the major economic forecaster to make the recession call. However, we were very wrong as to the steepness of the economic decline and the steepness of the subsequent recovery. The combination of very aggressive monetary and fiscal policies did, indeed, save the day.

 

Nevertheless, by January 2021 we were worried about the inflationary consequences of the all-out policies. I published a UCLA Economic Letter entitled “Is the Pandemic Hiding Future Inflation” where I outlined the case that the Fed’s highly stimulative polices ignited an asset price boom which would lead to consumer price inflation. ( Shulmaven: "Is the Pandemic Hiding Future Inflation," UCLA Economic Letter, January 2021) That is exactly how it played out and the Fed with all of its Ph.D. economists were asleep at the switch. It is here where I am critical of Timiraos’ account. He should have had a chart highlighting the Fed’s balance sheet expansion and the extraordinary growth of the money stock. At its peak the growth of M2 reached 28% year-over-year in February 2021 and a still high 11% as of February 2022. I know it is not fashionable to talk about money growth and inflation, but with current inflation running at 7.9%, you can’t really avoid it.

 

Timiraos talked to all of the major players and senior staff officials. My guess is that he talked extensively to Powell, Treasury Secretary Mnuchin and White House economics advisor Kudlow. There is a great deal of detail in the book, sometimes too much that it reads like a very long Wall Street Journal article. That said, Timiraos has written an important history of a truly epochal time that we are still living through.

*-Amazon has yet again had a problem in posting reviews.

The review was just posted on Amazon 3/17. The full URL is :   Bagehot on Steroids (amazon.com)

Defense Stocks and ESG Investing

For the most part ESG investors eschew defense stocks. They view defense contractors as producing weapons that kill people and are destructive to the environment. That is true, but ESG investors ignore the very impotant fact that defense contractors produce the tools that are so necessary to defend freedom and democracy. Were it not for anti-tank Javelins, anti-aircraft missiles, drones and basic military hardware, where would be the defense of Ukraine be today?

In my mind ESG investors ignore the fact that their freedom to invest where they see fit rests on the power and might of the U.S. military. Thus ESG investors should get out of their smug cocooons and recognize the world as it is and thereby open up their minds to defense stocks.

My Review* of Joe Ide's "The Goodbye Coast: A Phillip Marlowe Novel"

 

LA Noir

 

Joe Ide has resurrected Raymond Chandler’s Philip Marlowe investigating the seedy underbelly of today’s Los Angeles. He is acute in noting how the residents of Malibu obstruct the required coastal access lanes and the fact that the USC campus has failed to uplift its adjacent neighborhood. Although not mentioned Ide’s Marlowe is likely an African American with his detective father living in South Central Los Angeles.

 

His main case involves the fading movie star Kendra James who seeks his help in finding her wayward teenaged daughter who has fled after her father is murdered. The daughter accuses Kendra and her paramour of the murder. His other case involves Ren Stewart who is seeking to recover her daughter who was kidnapped by her estranged husband now living in LA.

 

Along the way we meet more than a few sociopaths, an Armenian gang and Russian mobsters who laundering their ill-gotten gains through Kendra’s husband’s production company. The writing is fast paced as the very well-dressed Marlowe cruises in his Mustang on the freeways and side streets of LA. Ide has written a true LA noir mystery.

*- Amazon had some technical issues in posting this review.

Amazon fixed its glitch the URL is here: LA Noir (amazon.com)

My Amazon Review of Paul Vidich's "The Matchmaker: A Spy in Berlin"

 Berlin Diary - 1989

Paul Vidich’s spy novel is set in 1989 Berlin before and after the Wall falls. His hero is Ann Simpson, an American working as a translator for the vetting of incoming refugees. She is married to an East German piano tuner who travels throughout Europe.

 

Suddenly her husband disappears and is later is found dead. Of a sudden she is visited by the CIA and German Intelligence, and she finds out that her husband was not what he seemed. Indeed, he was an agent of the notorious Stasi, the East German secret police.

 

In a style reminiscent of Le Carre’, we learn that he romance and later marriage to her husband was set up by a master spy modeled after the Stasi head, Markus Wolfe. The matchmaker as he is called, entraps lonely women into romance and marriage with one of his agents. Simpson, just out of a divorce, falls hook line and sinker for the plot. The marriage gives the piano tuner cover and information about incoming refugees. This last point is nontrivial in the development of the plot.

 

Along the way we find out that her husband already had a wife and family in East Berlin. Both before and after the fall of the Wall we have Simpson crossing into East Berlin and in one instance there is high drama at a bridge check point. Meantime we discover that the CIA’s motives are not as pure as we first thought, and that Ann will ultimately have to find vengeance in her own manner.

 

Vidich’s novel is elegantly written, and he gives a sense of what life was like in 1989 Berlin.

For the full Amazon URL see: Berlin Diary - 1989 (amazon.com)