Week 39 of Gibraltar Diary

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Sunday 7th December 2008

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At 11.30am we set off to climb the Rock of Gibraltar. Since our last effort in June, the steps have been renovated and after walking a mile or so up hill we climb up the final 450 steps which leaves us both close to death but triumphant.

Both the cafe and restaurant at the summit have now been closed and replaced with vending machines which steal your money. There are the usual apes and military reminders.

After 30 minutes rest we set off down and stop at the cafe at St Michaels Cave which serves home made soup. They are clearly not lying as it is not possible to buy soup that bad.

After a while we try a route we have not seen before and miraculously find ourselves going through a couple of tunnels to emerge between the old Casino and the Rock Hotel. Must remember that as it also saves the 50p admission charge.

Monday 8th December 2008

We are not quite sure what to do on New Years Eve but somebody has taken charge and we hope for the best. Certainly, the Rock Hotel restaurant has been fully booked over the entire Festive Season since October. Meanwhile, the Little Rock Cafe has only just realised that New Year is approaching so that is another alternative.

At 5.15pm we set off for the cinema to see Madagascar Escape 2 Africa but it is sold out. This is a slight relief as I was worried that the cinema might close as it never seems to be very busy. When I am in a cinema I do what all businessmen do - count the audience and multiply by the number you first thought of and prove that they will all starve to death. The proprietors that is, not the audience.

The reason the cinema is sold out is that there is some sort of religious holiday in Spain and all the shops have been closed over the weekend. Since many shops only make money in December and lose it for the other eleven months of the year this is just incredible - it would take an asteroid strike to close the shops in the UK just before Christmas in the worst recession for 80 years.

We decide to see Easy Virtue which is good fun. You just know that Colin Firth is going to end up with Jessica Biel - I mean, you would, wouldn't you?

I have to admit I had not realised it was a comedy though - and all the better for that.

Tuesday 9th December 2008

This is Alpha - one of the many little boats that chug around the harbour doing the cleaning and cooking.

In the evening we watch a programme about the worldwide increase in allergies. In it we see numerous anxious parents talking to doctors and researchers who are mystified by what is happening. After a while I notice that all the fathers have necks wider than their heads. The answer is clear - if you can take your shirt off without un-buttoning the neck, expect your kids to be allergic to things. Remember, you read it here first.

Later we watch a programme about a couple of Lancashire lasses who transport themselves across state lines for immoral purposes (see Mann Act. ). Specifically, they go to Turkey (what's wrong with Oldham?) to have sexual intercourse with young men. These girls could slap for England.

Wednesday 10th December 2008

The sun is shining so we go for a sort of wander around and end up at Ronda where we find that all the toy shops are closed. Well, you would shut a toy shop just before Christmas, wouldn't you - all those annoying customers trying to buy presents for their kids - very irritating. [Maybe they open again at 6.00pm?]

While sheltering from the cold in a cafe (Ronda is up in the mountains) we find yet another English language newspaper - The Olive Press. Here is a list of the others. Spain must be full of semi-retired journalists who fancy having a go.

We end up in the enormous La Cañada shopping centre where there is a place selling coffee flavoured ice cream on the first floor.

Thursday 11th December 2008

Late in the afternoon we suddenly notice that Taklift 6 is proudly holding something up out of the water. This turns out to be a large chunk of Fedra that sank back in October.

Yet again, we set off for the cinema to see Madagascar Escape 2 Africa and this time we actually get in. It seems somehow typical of Gibraltar that the fire alarm goes off three times inside the cinema but but nobody takes any notice despite the place being full of kids with parents.

The film is fun - I just love the song I like to Move it featuring King Julian, played by Sacha Baron-Cohen aka Ali G aka Borat. We also get valuable incites into the background of Alex the Lion so if you are a genealogist this is essential viewing.

Friday 12th December 2008

Nothing much happens all day and the highlight is a trip to Morrisons where we finally solve the problem of how to get all that stuff back to our flat.

Saturday 13th December 2008

We set off with some friends for La Cañada and on the way we pass under an interesting looking cloud.

Talking of dark clouds, you may be wondering what the implications are of zero interest rates. Don't worry about that - it is merely the warm up act for the main performance which will start before too long - if you don't believe me look at what is happening to long and undated Gilts - yields are rising.

This is because behind the stage, the guys have invented something far more dangerous than a dark cloud, or a tornado for that matter (when did you read of a tornado destroying a whole country?). Namely Quantitative Easing. I have spent my life studying, with real money and the written word how markets and economies operate but I have never come across this term before. Its meaning is very simple and familiar. Why bother to collect taxes and borrow money in order to win the next election (the only objective of all politicians who actually bother to hold elections)? Why not just print the stuff (or the computerised equivalent which is to just declare new holdings of money at the Central Bank)?

Printing money has given us the Weimar Republic and Harold Wilson. Incidentally, Harold only dropped the pound from $2.80 to $2.40 so what was all the fuss about? These days the pound drops that much every week and nobody even notices.

From the point of view of the man in the Ford Mondeo, serious inflation just means that everything starts to go up in price very rapidly. But interest rates go up too, so if you have a mortgage or are thinking of getting one, ensure that you can afford to pay 20% interest rates with no job.

Back in 1979 I borrowed a lot of money with two partners (we each put a pittance into a hat as the deposit)to buy a collection of shops, offices and factories at 24% interest from Twentieth Century Finance which was a subsidiary of P & O (Peninsular and Orient). The assets we were buying were yielding from 20% to 40% so this made sense but it is hairy if things go wrong.

As this example shows, serious inflation has strange effects on property prices because the effect of very high interest rates is to drastically raise yields by dropping prices. This in turn causes forced sales and the effect is self re-inforcing. So, you may suddenly find that property looks very cheap but nobody can afford to buy it. If you don't understand all this then be very careful.

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      End of Week 39 of Gibraltar Diary

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