Bill Blain: ‘What We Saw In San Francisco Was Frightful”
Blain’s Morning Porridge, submitted by Bill Blain
ZeroHedge.com
Tue, 02/05/2019
It will be a short comment this morning as I play catch up and try to figure out if we should be worried that it’s the Year of the PIG. Sounds great, but I’m supposed to be on a diet.
Reason for catch up is I’ve just spent a week with 300 or so like-minded bankers, brokers, fund managers and tech-experts at Interbourse; the largest annual Ski event across the financial services sector. It’s been running for over 50 years. All the major markets were represented – and aside from great skiing in Squaw Valley and Alpine Meadows, California, there were some great (liquid-fuelled) discussions on markets. The 2020 event will be in Switzerland.
Let me sum up the week with some of the strands of opinion heard in the resort:
The Europeans don’t understand why the UK is so keen on Economic Suicide via Brexit. The Brits don’t understand why the Europeans are so keen on the EU and Euro. The Hedge Fund managers reckon the real effects of Brexit are being massively overestimated and see value across markets. The Tech sector analysts think we’re on the cusp of massive upside in Tech Stocks. Everyone is worried about populism. The Canadians had more fun than anyone else. The Germans took it quite seriously. Everyone was fine and dandy with the Fed applying the brakes to policy normalisation. Everyone was looking to earnings. I still don’t understand Coin-Token Driven IPOs. No one could quite understand why Trump is so keen on the Wall – liberal doses of Tequila proved a great way of easing strained muscles.
Yep, the usual kind of conference. Lots of people happily explaining their views to people happy to listen. However, I do understand markets continued without me last week – and am still playing catch up on what I missed. Some great stuff in the papers (from Bill Gross, Deutsche Bank, Airlines, Saudi, and whatever else) and some excellent commentaries, but I think I’ll ring round clients for the real stuff.
BUT…
Turning the mood on its head – and no doubt attracting much comment for the hypocrisy of commenting about a luxury ski trip and then poverty – I have to comment on the contrast between the skiing and spending some time in San Francisco.
I hope my American hosts will forgive me for raising this, but the squalor we saw in The City was frightful. San Francisco has always been one of favourite US cities, but the degree of homelessness, mental illness and drug abuse we saw on this trip was truly shocking. Walking round SF on a Sunday Morning and we saw sights we couldn’t believe. This must be one of the richest cities in the world – home to 4 of the 10 richest people on the planet according to Wiki. I asked friends about it, and they shrugged it off.. “The City has always attracted the homeless because of the mild weather,”.. “It’s a drug thing”.. “its too difficult”… “you get used to it..”
Well, I didn’t.
I found it quite shocking the number of folk sleeping rough on the sidewalks, the smell of weed and drug impedimenta everywhere, the filth, mental illness and degradation on view just a few meters from the financial centre driving Silicon Valley. It’s a city where the destitute seem to have become invisible to the Uber hailing elites. We found ourselves hopping on one of the beautiful F-Route Trolley Buses to find nearly every seat occupied by someone lugging around their worldly possessions around in a plastic bag. It was desperately sad.
I read an article from Businessweek speaking about the success of a $5mm 50-employee scheme launched last year seeking to identify and address the problems of the City. $5mm? Really. Same article says I read there are around 7500 homeless in the City – which I reckon must be a massive underestimation. It says homelessness in Los Angeles is over 60,000.
What has homelessness and urban poverty in San Francisco got to do with markets you might ask?
Everything. Absolutely everything.
The Rest…HERE
