Friday, December 19, 2008

Supply & Demand

One day from Jubail to Al Khobar……………thoughts drifting

Riding down the highway
Heavy Metal Thunder
Looking for adventure
And whatever comes my way

Yeah yeah, enough of that shite. My little Honda Accord is out of gas, so I slide into a gas station and off the engine (mentally switching off the Harley as well).

Fill please, and 50 litres later, 20 Riyals. Whew, a bank breaker. The Saudi Riyal is linked to the US Dollar at a rate of $1 equal to 3.75 SR. That’s a whopping $5.33 to FILL the tank. Yep full as in brimming, from empty as in “damn I need gas quick”.

When oil reached $140 a barrel, I was amazed. Working in the oil industry and knowing the true cost of a barrel of oil, I wondered where the rest of the cost came from for the extra $135 each barrel was fetching.

Figure that all “goods”, which oil is, are comprised of a labour and materials cost on which the “honest” trader affixes his/her margin (read profit) to arrive at a price that the market should think is good value.

The costs never rose with any significance. Labour fluctuated about 10% over the period and machinery of extraction and refining has stayed pretty much stable.

Someone told me supply and demand was to blame. Demand far outstripped supply. And that’s what made it so expensive. Boo hoo. Put your hand up if you didn’t get your oil? Deafening silence there eh? EVERYONE got oil.

So a funny thing happened when financial markets crashed. Oil prices dropped to $45 a barrel. Excuse me? So supply now overwhelms demand? That’s a staggering 65% of prior heavy metal users who said “er, no thanks, don’t need ANY oil at the moment, but thanks for asking”. I wonder where these people live?

Keynesian economics and its fundamental use of supply/demand theory is of little use in manipulated markets.

The real question we should be asking is not what caused the price to fluctuate, but what have the oil companies done with all the money? Yes the Money honey.

This should be followed swiftly, before those who really have the money start flying out on corporate jets to “meetings”, with a “who the fuck, as in governments, allowed this manipulation to happen?”

When you start to add up all the bloated (no other word for it really) profits pirated from oil over the last 2 years, is it any surprise that some poor unfortunate who struggles to pay an over extended mortgage is blamed for a financial world crisis? Mortgage meltdowns?

Sure I believe it, just like Iraq had WMD and Iran is full of bogeymen.

Several things we should consider in order to remain civilisations:

We are societies not economies.

Corporations should be banned outright, they have no purpose to be, other than to add cost to your labour and consolidate this “extra value” into the hands of a very small number of people. Just because you “own” stock doesn’t mean it has value or that you get to say how the corporation conducts itself.

Energy in all its forms needs to be taken away from corporations and put back into the hands of democratically elected governments. Get off your ass, take an ACTIVE political stance.

The same amount of money that was in circulation is still in circulation. Credit Crunch? What a giggle.

If you think a CEO is a hero and worth more money than the janitor, ask yourself the same question when the toilets need cleaning.

The only thing in this world that has true value is YOU. Everything between YOU and a buyer adds zero real value.

Piracy is still punishable by death in most places.

Tuesday, December 16, 2008

An Encounter

Picture this.

A gleaming white limo pulls up onto the busy sidewalk scattering shoppers in all directions.

Out jump 3 guys in dark suits and sun glasses one hand in suit pockets. An all white suited guy emerges, dappa, unaware of the commotion. I suppress a giggle, surely this is a film scene being enacted before me. No cameras and here come the Police. Tokyo’s finest shuffle down the street, take one look at the white suited figure and run, yes run, in the other direction.

Royalty?

The car stays parked on the sidewalk, its in front of Tokyo’s most up market café in the Omotosando district near Harajuku, at which I am sitting with an American Photographer friend of mine (drinking espresso of course, did you need to ask?).

“Oh oh, it’s Mori san standby” says my American friend, I suppress a giggle at the entourage looking like all time bad actors in a D grade gangster movie, Mori san in white at the center. They sit at the table next to us and nod in our direction. I focus the camera and then think better of it as I ask my friend “who are these guys and who is the clown dressed in the all white suit?”

Yakuza.

My friend turns round and smilingly says “Hey Mori san, come say hi to my Australian photographer friend”

Oh no, now we are in for it. Mori stands, the black suits look uneasy, he casually strolls over and in good enough English says “You are friend of Randy? Welcome to my city”. He sits down. Waitresses appear, falling over themselves to get whatever he wants, the café owner appears, sweating, nervous, fluttering.

He asks me a few banal questions then asks to see my photos at which I pull out the trusty Mac, fire up and our real conversation begins.

He’s a talkative yet authoritative character. We drink espresso and smoke cigars (Cohiba Siglo’s my favourite). When he needs a light he flicks his fingers and one of the black suits snaps to attention with a lighter, bowing formally as he lights the Bosses cigar ever so ritually. We talk about photos, photography, the world, coffee, cigars and after an hour or so, we are “mates”, regular buddies just doing coffee on a Sunday afternoon, except for the getups and the ever present mobsters hovering, plus the obsequious fans who keep coming over to formally bow, not to mention the big limo parked across the sidewalk.

Eventually, he rises to leave. There is no bill for the afternoon. He reaches into his jacket and hands me a business card. Not just any card but hand made paper with his name and clan written in calligraphy and chopped with his personal seal. The phone number is on the back. “Miko san, you may go anywhere in my city, show this card and you will be made welcome”.

“Thanks Mori my friend, here’s mine, and you are welcome in my city whenever the mood strikes you to visit me in Bangkok.”

The entourage departs, frankly I don’t quite understand what I have just witnessed and still find it a little comical.

It’s not till later that I understand when I get a very strange reaction as I show a waiter the card and ask for a translation. The waiter goes white, disappears very quickly and is extremely reverent for the rest of the night.

Weeks later I discuss the incident (for wont of a better word) with a media friend of mine who has lived in Tokyo for over 20 years.

“Ahh the Yakuza” he says, the real Japan. Mobsters who not only do crime, prostitution and drugs as the least, but they “know” people and are the oil between the gears, the advisors and fixers for big industry. Need some dirt on a rival, Yakuza are the boys to help out. Need some girls for a little soiree? Something else not quite legal? Yep Yakuza to the rescue.

Employ their labor? Yakuza control most of the labor unions and this is why Japan has so few labor strikes.

These are the guys who do all the dirty work for industry. They are the modern day Ninja, an indispensible part of Japan. Their clans and code of honour are legendary and on subsequent meetings with Mori san I learn of an older more formal strata of society, bound by deep rituals and respect for hierarchy to the point of self destruction if that’s what it takes.

Mori is a killer, I can see it in his eyes, i have no doubt he wouldn't hesitate. He is also the number 3 man for Tokyo, and I never treat him lightly nowadays no matter how he dresses.

He is good conversation over coffee though.

I carry his card with me everywhere to this day. Well, you just never know eh?