E Polar Vortex And BISIT

Today we learn new vocabulary. What has hit North America is a stray but very big "polar vortex." Said vortex exited its normal persistent cyclonic track around the North Pole, moving south into densely inhabited lands, hitting flat open sites (like airports) the most. That explains the weather.

The "fragile 5" or BISIT is defined in today's Neue Zuercher Zeitung, emerging market countries with high political risk: Brazil, India, South Africa, Indonesia, and Turkey. Mysteriously, Thailand, Hungary, and Ukraine are left out of the anagram. My idea is a 7-country list called BISTUITH. (I tried for to BISTHCUIT but I don't think any of the C emerging countries with accessible markets have high political risks: China, Colombia, Chile. Côte d'Ivoire would fill the hole but who invests in Abidjan?)

More global news follows from China, Brazil, Portugal, Britain, The Netherlands, India, Switzerland, Belgium, and Mexico. I take on the Swiss and the Belgians below.

*Bloomberg reports that Liberty Global is close to tying up its takeover of Dutch broadband provider Ziggo in a friendly deal. LBTYA/K already owns c30% of Ziggo. What has still to be decided is the price and what role Ziggo CEO Rene Obermann will play once John Malone has snatched the firm. The Liberty Global shares we own are ADRs of a UK firm.

*BISTUITH investing is alive and well with the Franklin Templeton funds buying heavily in Ukraine and Thailand according to articles in the business press over the weekend. Our closed-end Templeton Emerging Income Fund (TEI) is a big player in search of hidden (or invisible) opportunities in the bond markets.

*I think anagram investing is dangerous, after the original BRIC theme worked out. NZZ may chatter all they want about which emerging markets to invest in based on what analysts tell them.

But what with the politicization of the Swiss National Bank and the sacking of its chief last year, Berne wound up holding too much gold in the national coffers. The result has been a $10 bn paper loss on its gold in 2013. So Swiss analysts are rooting for a rise in the gold price this year out of Eidgenossische patriotism, writing to the tune of the Wilhelm Tell Overture.

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