World Markets

One reason the price of gold is up to about $300 an ounce is that the unlimited government insurance on Japanese bank deposits runs out on 3/31 and some banks will fail because they have loans coming due they can’t pay. The Japanese have long trusted banks backed up by this insurance which is a main reason for the unusually high savings rate in that country; now they know they can’t and there are very few things ordinary Japanese can invest in, so gold is making a comeback. The rest of the world is doing its best to insulate itself against the coming Japanese collapse but it is only a matter of time and its effects on the rest of the world cannot be fully calculated because market psychology will be part of the equation.

More important: There are varying reports as to the strength of technology purchasing by American companies. Some say it is rebounding, others say it is still weak. This is a crucial indicator that must be monitored carefully for solid signs of sustainable growth before anyone should buy into the stock market as a whole. Getting 1% interest on deposits beats losing 40% in the markets.

The Middle East

The #1 Question I’m being asked is What about the Saudi peace initiative? Answer: Go ask the Palestinians. The Saudi initiative doesn’t deal with the refugee issue and the conflict will not be solved by setting borders alone. But this is a great time for Saudi Arabia to throw the ball into Sharon’s court because Sharon really is not interested in making any deals. 

This weekend at my synagogue I heard recounts of visits to victims of terrorist attacks and attendance at such funerals; about 100 people from the local community made a solidarity visit last month to people in the settlements. This weekend came the news of another suicide bomber at a Jerusalem synagogue at the close of the sabbath. And then today a lone sniper created a legend for himself when he knocked off a whole squad of soldiers manning a roadblock over a 25 minute period and escaped. What I heard at the synagogue from the travelers is that we must support these people who are victims of these attacks and how the saving grace of attending such funerals was to see all these children at these funerals waving Israeli flags with pride. What I don’t hear is anyone questioning why these people should continue to be there. 

When Sharon took office, I predicted that after about a year Israeli public opinion would tire of the escalated warfare and start shifting back toward the Left. It is beginning to happen. Sharon will be remembered as a do-nothing prime minister who escalated the conflict to a higher level and delivered more victims to the Israeli side than any prime minister before him. The benefit may be that a clear majority of the country will be convinced that trying to hold Greater Israel is not possible since even Sharon couldn’t put down the Palestinians or offer any kind of plan to get out of the morass. Till now, it hasn’t helped that half the country thought it could have it all.

It is just a big loser for both sides and I am becoming somewhat immune and cynical to the bad news. So are the Israelis; last night, TV’s Second Network showed a live feed from the scene of a terrorist attack on a split screen along with a soccer game in progress. 

The Palestinians haven’t yet figured out to limit their resistance to occupied territories and military targets and still send bombers into Israel-proper; this is not the way to influence Israelis into thinking that withdrawal from the territories will make them safer inside Israel-proper instead of being more exposed than they already are.  Besides, Palestinians came across as bloodthirsty savages on the BBC when it showed people throwing sweets and dancing in the streets of Bethlehem as news of a suicide bombing at a Jerusalem synagogue was reported. Meanwhile, the Israelis send the army all over the territories and don’t seem to be accomplishing anything except recruiting a generation of suicide bombers and driving people to madness. Neither side can win this war this way and the one sure thing that is happening is that those Jews and Arabs with money and education are leaving.

As far as I can tell, the main reason the Israelis entered the refugee camps this week is that they agreed with Palestinian security officials on a ceasefire for Jewish and Moslem holidays that fell out at about the same time. The ceasefire for the Moslem holiday was kept but the one for the Jewish holiday was broken almost immediately. But there are no angels here; the Israelis had promised to let Arafat out of Ramallah after he arrested the killers of Mr. Zeevi.

The main reason the Israelis are keeping Arafat on a short leash (even Peres didn’t really object when the decision to keep Arafat in Ramallah was made this past week) appears to be that they are hoping he will crack under the pressure, have a heart attack and die, so that no one has to be responsible for having killed him. The missile strikes on his compound and the keeping away of foreign visitors is all part of this psychological warfare and it is having an effect. Arafat, I am told, did pull a gun on Rajoub earlier this month and his hand was shaking as he both dropped the gun and had it pulled out of his hands by his bodyguards.

As for myself, my visit to the region this past October was just too depressing and dangerous to want to repeat it. There is something very wrong if I feel safer in Amman than in Jerusalem and have to walk around Tel Aviv and Jerusalem in the shadows timing myself to outwit acts of random violence. I will vacation in secondary cities in Europe and stay clear of this mess through the end of the year. Hopefully by then Arafat will be gone, Mssrs. Rajoub and Dahlan will be backing Mssrs. Abu Ala and Abu Mazen and Mr. Barghouti will have either gotten with the program or be sidelined. Either Sharon will then be negotiating a global settlement or heading into early elections so as to keep Netanyahu out and pre-empt any liberal who may take over the Labor party. Everyone can at least agree on the idea that Netanyahu should be kept out of the prime minister’s chair – even the Arabs prefer Sharon because at least he means what he says even if Netanyahu ultimately makes more concessions and looks like a moron when he does so (meaning it is never necessary to reciprocate his moves). At this moment Sharon can be relied upon to be solid during a campaign against Iraq and that is good news for people in the region who run countries. For the next 6 months, he is the man. Maybe we will be lucky and some new bright individual will make himself known as an alternative when the smoke clears.

Remember though that the Israeli-Palestinian conflict is a sideshow right now for the region. The US will soon be wiping out Saddam Hussein and his family – his son will not survive to rule Iraq. Saudi Arabia cannot ignore the fact that Israeli troops will be in the battle theater this time around (to some extent to cover Saudi ass) or that the US has teamed up with Russia to squeeze OPEC out of its dominance in the world oil market. American troops are already on the ground in Iraq scouting things out and people are being shipped to staging areas in Turkey that cannot generally be found on maps. The attack will be swift and decisive when it comes in 3-4 months. The Israelis and Americans are more confident this time around as to how they will handle things that happen and their capabilities have vastly improved. Understandings with the Turks have been reached. The Arabs in the region and the other powers (ie: Europe, Russia, China) are no longer questioning whether or not America should be fighting Iraq; they are positioning themselves for a new reality. The Saudi initiative should be viewed as such. Another consideration is that the rulers of Arabia have factored in the results of a poll of Saudi elites that shows that the Palestinian issue is now their #1 issue and that tensions with America are based on political as opposed to value conflict and would decrease immensely if the issue were solved.
 
Response to Education Reform Initiative

A month ago I posted suggestions for reform of day school education and received some interesting feedback.

One question raised concerned the underestimated cost of networking. I question the question. Today there are wireless networks and the whole issue of a network needs to be questioned. Does a small school need a school-wide network or can you use something internet-based with proper levels of security? Teachers do not really share information with each other and a small administration doesn’t share information with anyone else. Teachers can set up websites for their courses quite apart from a network.

Somebody asked where the basketball court and baseball field were. Again, does every school need one? Does every school need a working kitchen built to make food and serve it to several hundred people? New thinking sometimes requires back to basics thinking. Lunch can be outsourced; healthy food doesn’t have to be hot. Phys-ed’s objective is to teach kids healthy habits and get them in shape and you don’t need buildings or vast facilities for this (just give me an ex-marine and a parking lot); the varsity programs give some kids a shot at a great experience (sometimes with counterproductive educational consequences) and sideline 90% of the others. I did mention in my original text that lunch, transportation and information costs (ie: educational materials) would be extra costs not included in the tuition – if people are paying these costs directly, they will quickly become much more efficient in making decisions on both individual and collective levels.

Another objection was that the schedule appeared to be loose and a sort of smorgasbord of educational offerings. Someone thought that the curriculum offered too many options. Actually, the objective is not so. The curriculum is not optional but mandatory and rather intense with the objective of really teaching stuff well. The point was to space it out so that students could focus on a few things rather than rush through 9 periods a day of 40 minutes each in which nothing really gets taught. The end result if you count up the hours is very close to what already exists in most areas.

This week in the New York Times it so happened that these issues were discussed by New York educators looking to radically reform school schedules. One educator was quoted as saying that the smartest reform he’d seen was in Alaska where they bring in a chemistry teacher to teach the whole course intensively in 6 weeks because they can’t afford to keep a chemistry teacher for a full year. They are also looking at putting courses into rotations with longer periods each time a course meets and believe that the current system with many short periods a day doesn’t work. All of which leads me to believe that I am on to something...