Jerusalem – Flew 3 hours on El Al to Israel as Alitalia no longer has a morning flight from Rome. Check in is hidden behind the far edge of the airport terminal. Sat a bit on the runway and arrived 45 minutes late. My taxi driver didn’t seem to know very well how to get around Jerusalem and the traffic inside Jerusalem has become terrible. The new bridge at the city’s entrance is still under construction. Must allow extra travel time to get to meetings and it’s probably best to schedule driving around and such meetings at night. 1868 Restaurant in Jerusalem is a new talk of the town; I think it’s overrated and overpriced. Haaretz newspaper says that Lillith Restaurant in Beit Asia in Tel Aviv is the new #1 kosher restaurant in the country. Emek Refaim section of town (German Colony) has become a real happening place; the center of the city is also coming back though they ripped up the new light rail lines due to construction error and have to do it all over again. New shopping mall at Mamila is reaching a critical mass but lacks one-of-a-kind shops. Has pretty ramparts overlooking the Jaffa Gate where you can have a nice coffee. In the city center, the Mashbir department store desperately needs a makeover. Visited the campus of Nishmat, the women’s seminary that honored my wife and I this year. My wife has joined the board of their American Friends organization.  The King David Hotel is all spruced up with memorabilia for its 75th anniversary. Friday morning I had breakfast with Mohammed and we went to the Al Aqsa Mosque, had coffee with the head of Waqf security and then visited the inside of the Dome of the Rock (check out pictures on this site – link at end of the article). It’s a real hassle getting inside especially on a Friday morning, but Mohammed is a chief judge of a the sharia court of Nazareth so they have to deal with him. I walked to the Western Wall on Saturday morning; food at the King David Hotel remains excellent throughout and El Al first class to Hong Kong on the 10½ hour flight (I upgraded from business class with miles) was also excellent with some dishes I’d like to get the recipe of (one was of an eggplant with tahini, dates and honey sauce).  Generally, Israel is as hopping as I’ve seen it since I first visited in 1983. Everybody is out there doing their business – nobody is complaining – and the hotels are sold out months in advance with delegations, Bar Mitzvahs, dignitaries and conferences, you name it. For whatever reasons, the Beirutis still are shooting each other in the streets a year later but here I had to book a suite 3 months in advance through someone in the hotel’s back office and my business partner who is in real good with the hotel was stuck sleeping on my couch because he couldn’t get a room in the King David. My family is to visit in June 2008 and many hotels are already sold out and the Sheraton Plaza which a year ago was $100 a night is now asking $400 a night at up for June. I’d try the King David Citadel but it is also expensive and hard to get into. The King David provides good value if you use the Amex Platinum upgrade. The Eldan is still a good value at a fraction of the price right on King David street – right now about $120 a night. Detailed notes of my conversations on political issues follows at the end of the travelogue. Was in Israel from Thursday afternoon till Saturday evening. Israel’s shekel is very strong against the dollar and that means that prices overall here have gone up over the past few years.

Hong Kong — Was here from Sunday afternoon until Tuesday morning and then stayed at airport hotel Thursday night stopping over on the way out Friday morning. The Peninsula Hotel provides good upgrade value, breakfast and high tea on the Platinum Fine Resorts program. Know though that the orchestra doesn’t play on Mondays. I had the concierge here send home my shopping boxes. The boxes got home before I did within 3 days. Hong Kong dollar remains constant against the US so it is a real bargain here. China was also very reasonable with its weak currency against our dollar. When visiting a tailor here, it helps a lot to come with a list and a few swatches. Saved a lot of time and duplicate ordering. The metro is great here – from Central to cross the Harbor to TST in Kowloon was 2.5 minutes and the fare is like 50 cents. In Shanghai, the fare was about 35 cents. People queue up very nicely in front of the doors to the trains; might have to wait for 2 or 3 trains till everyone gets aboard but you know exactly when the next train will come so it is humane. Beautiful kiddie shopping by the Ocean Terminal basement level near the Star Ferry building and in Lee Gardens 2 shopping center on the second floor in Central. Never saw so many pretty childrenswear shops before. All kinds of brands from all over the world at reasonable prices such as Cicco, Haba, Braun, Compagnie de Petite. Its Magical had pretty toys as well, a Spanish chain. Cheapo late night dining is available at DeliFrance a few blocks from the hotel parallel to Nathan Road just one block closer to Canton Road and a few blocks going away from Salisbury Road (the one in the Holiday Inn closed). Late night fish and chips at the bar of the Peninsula also worked well. Get your picture taken on the Avenue of the Stars at night with all the glimmering lights of the Hong Kong skyline behind you. At 8pm is the 15 minute light show every night with the whole skyline participating. Lane Crawford department store had nothing for me this time. Some nice ties at Sogo (the shopping center across from the Sheraton and next to the Intercontinental Hotels.) All things considered, a junior suite at the Intercontinental with Harbor View beats out a Deluxe Room on the 27th floor of the Peninsula. The best all-around rate and location is the Sheraton between the two hotels. I always wanted to stay at the Peninsula; been there and done that and they do kick ass over there and want to maintain their very high ratings and if you call housekeeping from your room and ask for something they will be at your door within 2 minutes, but it doesn’t really matter that much to me except that you are quite happy when the package they are shipping to you at home actually arrives. (They forgot the reminder wake up call though.) Hong Kong makes a great impression; could use more passport control people at the entrance and the airport is still a lot of walking but the city works well, traffic runs, the metro runs and you can get anything you want here at a pretty good price. The city works 7 days a week; the post office is open on Sundays and you can walk around at 11 at night and the streets are busy with commerce. There is a lot of wealth here; at the supermarket below Lane Crawford in Times Square in Central there are a lot of high ticket items you can purchase.

Shanghai – It’s a 2.5 hour flight from Hong Kong and Dragon Air is excellent in business class; very cramped in coach. I am here from Tuesday afternoon to Thursday late afternoon. Passport control is a breeze; they take it seriously and have you rate them as you leave with little push-button surveys (happy face for quick exit and frowning face for “took too long.” Took the Maglev train which is an 8 minute thrill ride that reaches 431 km/per hour to the edge of town from the airport. Leaves every 15 minutes or so and costs $5. Show your air ticket at the ticket window for a 20% discount. You then catch either the metro or a taxi to get to town. A taxi is 20 minutes and about $5 or you can take a metro for 50 cents and about 15 minutes which will take you within 5 minutes walk of the Grand Hyatt Hotel. I took the taxi in and the metro out. When I arrived at the train station to get in a taxi, there were 7 police officers arguing with the lead taxi and his passengers for about 5 minutes with 50 taxis behind him, it was all in Chinese, nobody speak English and my driver didn’t understand Grand Hyatt Hotel (means nothing to a chinese person). When I arrived, he tried to drive off with my luggage. All things considered, it’s a problem taking taxis here upon arrival and the metro is not necessarily the worst way to go. It’s also bilingual with good signage. Take the name of the hotel with you in Chinese or at least take their phone number; everyone has a cellphone and my taxi driver talked to the hotel and found out where to go. The Grand Hyatt is a beautiful hotel and occupies very high floors of a building; my suite has a very nice view but it is not all that impressive a view due to lots of window obstructions; there is a club floor at the 83rd floor also with nice views good food, lots of fresh juices and a very good pastry chef. 

Shanghai has lots of new construction with good wide roads, some of them elevated, and pretty touches such as street public art, flowers by the roadside, big parks (though you have to pay nominal admission to walk into them). Hotel has beautiful public spaces and live Chinese music playing in the lobby in the evenings. A very nice change from the usual standards. On the subway, a monitor tells you to the second when the next train is arriving. Greg pays $4,200 a month to rent a 2,200 square foot 3 story townhouse with a large garden in a good part of town. As an expat, he is paying more than a local but rents are all over the place – you can pay New York prices in Shanghai for the best of the best. Things feel safe here, at least for foreigners. China is passing laws but there is little enforcement; our clients don’t want to file patents here. During the last communist party conference, government cut off all foreign news cable channels for 3 weeks before the conference and for a week after. (But not in the hotels.) Internet is slow and carefully filtered. The government is simply a dictatorship, not even communist. They don’t care about their workers but that they might revolt – it is a country with lots of chattering masses and their threat is not from the English speaking yahoo! elites. Singapore seems more secure and housing prices are on the rise, so Greg invested in property there. With a Singaporean spouse and owning property there it’s much easier to get that country’s passport. 

With a car and driver and guide, did a day of sightseeing and if you push it in 8 hours you can see just about everything. Started at the Ohel Menashe synagogue, the government just kicked in $1 million to restore it but the community of 2,000 (mostly Israeli) lives across town and doesn’t use it regularly. Greg says the Shanghai Jewish community is more happening than the one in Singapore. El Al flies now 5 times a week to Hong Kong and would like to have a flight into Shanghai too. They fly also to Beijing. Seoul is a market also they are trying to reach. After the synagogue, went to the Bund which is the financial district. Lots of colonial architecture here and be sure to see the lobby of the HSBC bank. Walk along the riverfront; saw a teahouse (no peppermint flavor available though) and then to the Yu Yan Garden, very pretty to see of the Chinese garden and old house variety. Went to a silk store to buy pretty pajamas. Lunch in some restaurant with 3 kinds of spinach, noodles and some egg-white roll with custard sauce. Went to People’s Square to see the Urban Planning Museum – a huge model showing the planning of the city fills an entire floor. Also a diorama with moving 360-digital videos of the modern city – very cool. Shanghai Museum for Chinese art. Drive to Jade Buddha temple for the local institution of this kind. The monks come out at 4pm and march around and make noise. Walked through the French concession neighborhood, much of which I understand is being destroyed. Foreign newspapers reach your hotel in the late afternoon. Evening time with Greg in the Xin Tian Di district; shopping malls, cafes and pedestrian areas – no Chinese characters or music anywhere. Thursday morning I take the metro to the Museum of Science and Technology adjoining a counterfeit market which I think exists mainly to give locals an opportunity to acquire things they can’t otherwise afford but see that they want. The museum is very impressive with sophisticated experiments and exhibits and lots of high tech toys for kids to come into contact with. A visiting exhibit on digital art from Austria with lots of English-speaking guides. Gives you a distinct impression that China wants to put all tools necessary for scientific advancement into its peoples’ hands. Probably a more impressive science museum than many in America. Walked through Century Park, a municipal park with a $1.50 admission – but very clean and quiet. Returned to the Li Yuan area to buy some souvenirs and gadgets. The airport lounge was quite crowded upon departure and the airport has a rather long concourse but it is in great shape and very impressive – you don’t feel you are in the third world in China except when it comes to the drinking water. Once back in the Hong Kong airport, it is a 3 minute walk to the Regal Airport Hotel which is a very good one of its kind. If you are on a Club floor, it is open till midnight and you get 30% off services in the spa and Betsy is a great masseuse.  The flight to JFK is 14:30 on Cathay (usually an hour more but we got lucky) which runs one of the better business class services in the sky. Food is good and every seat in First and Business class is full – same on flights from Israel to Asia and within Asia. It is really hopping here as far as air travel is concerned. You can find some empty seats in economy but clearly there is a market for the upper class travel and it is happy to pay the price which has doubled during the past few years.

Overall, Shangai is more tasteful than Moscow (no mafia types mulling around with weapons and flat-heads), not as avant-garde as Dubai but the architecture is quite interesting. Shanghai, like St. Petersburg, shows its historical openness to foreigners and their influences. Beijing like Moscow is more closed and less English signage. Drivers are nuts; pedestrians cannot count on their right of way. Drivers drive on the wrong side of the road. Lots of spitting. Not a totally civilized place with lots of people from outside the city who happen to be living here. Lots of conspicuous consumption and pretty lights. Government is pragmatic and eager to do business and mostly wants to stay in power. The question is whether they need to worry about the BBC-watching elites or their own chattering masses. Things work well here – there is a smattering of old and new here stuck right up against each other while development takes place on a fast-track and we will see how it all works out over the next 10 years or so.  The main question for me is: Is Freedom Overrated? I’ve read pro and con articles on this subject but now consider what I’ve seen for myself. Lack of democracy and interest groups mean the government can build massive roads and infrastructural entities to handle expansion, metros that run on military time, while the US can’t even get its airports to operate and its air traffic control system falls 20 years behind the one being used in China which now has close to a 100% safety record or equivalent to the US. Our trains and metros are third world; our streets don’t move in the big cities and people go to Fedex even with ground parcels to avoid the post office. Growth in China is assured; there may be a bubble in its stock market with many paper billionaires who will fall to the ground, but there is no question that there is tons of business being done here. I’m sure people want freedom but there seems to be plenty of freedom to do your business as long as you stay out of politics and I don’t have any sense that the lack of political freedom has any dampening effect on the high rate of Chinese business productivity. Most Americans stay out of politics and couldn’t care less as long as it doesn’t hurt their business. The problems right now in China due to the lack of rule of law and all the politics is for foreigners – they’re the ones who are not protected. The Chinese seem to feel perfectly well protected as for themselves and I’m not sure that it really matters how much foreign direct investment there actually is in China. China as a whole is big enough to steal what it wants and to create whatever else it needs. I noticed the huge Chinese embassy in Lisbon last year and noted that Portugal is a spearpoint into Africa where China is attempting to sway countries to become commodity providers to it.  It has to deal with the rest of the world in terms of commodities it wants to buy and to find customers to buy its goods. In Dubai this week a bridge collapsed during construction at the Dubai marina and 7 died; in the UAE, you go an inch below the gloss cover and realize there is not much there – for instance, not much of a legal system. China also is bad in that respect, as all the recalls of its products indicate. But that was also the USA in the 1920's before the feds stepped in and started regulating after a load of consumer scandals. The same will happen again. Meanwhile, Singapore is the real thing and this is why that country plods along as a safe bet. I think that soon China will come around and become more of a team player in terms of introducing things such as quality assurance in safety and internal regulation, so that customers do not revolt. I saw a sign today in a children’s toy store “Goods not made in China” and that kind of thing will force them to change when it happens not just in Manhattan but all over. I don’t see Taiwan as a military item on the agenda; the Chinese have every good reason to continue to fold it in economically into its order without having to catch the bear with vinegar as opposed to honey. This week someone next to me flying into Shanghai from Taiwan noticed a Chinese language advertisement in the Dragonair onboard magazine for a property development in Taiwan; first time that advert appeared and there is no doubt that such things mean something. China seems quite confident, friendly and not at all paranoid; you don’t see scowling soldiers, begging in the streets and all the signs show me there is infrastructure, room for growth, access to technology and that everybody is working hard and getting ahead. My visit convinces me that China has every bit of the potential it needs to be #1 in the world and the US needs to get its act together as it continues to lose ground against China. The big economic question today is whether China and the rest of Asia’s growth will insulate the US against its own recession as US companies make more of their profits abroad – unfortunately, I think not. The planes may be every seat full in Asia and Singapore might be a good buy, but when the Dow Jones goes down 5%, everybody else does too. They are still in need of the US markets to sell their goods to, and there is still a sense that the US is the world economic leader. While I think that planes to and from Asia will remain full (as long as there is no other scare), I think the markets will react negatively to bad news in the US to some extent irrationally in terms of the performance of the domestic markets in Asia. 

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Israel Conversations Friday and Saturday November 2 and 3 – Mohammed (chief judge of a local religious court) – Iran is not a big deal; need to talk to Hamas; Abbas is nothing. Ehud Olmert is stable; nothing is really happening. Gulf will be overrun with expats demanding rights in another 10-20 years. Spoke with former chief rabbi Israel Lau on a panel about a book about Yochanan Ben Zakkai; there was 2 months to prepare for this panel; Lau hadn’t even opened the book, let alone known the title of it. Just not a serious guy when it comes to real stuff.

Oded (strategist and academic) – Planes in the air 2 days ago filling the whole sky show that Iran is gonna get it. More maneuvers this year in the army than in the past 20 years. Assad is called in Arabic some kind of imbecile and he didn’t get any Ramadan greetings from any other Arab country. Hizbullah head of intelligence admitted they lost the war last year in every respect and then he defected to some European country. They lost 700 fighters and have trouble recruiting new ones; the names of martyrs are plastered on university walls all over the region. A good amount of Herzliya by the sea is now owned by Indians; the Israelis and Indians work together to box in Pakistan. Georgia is filled with Israelis; the defense minister is an Israeli and the advisor to the chief of staff of its military is an Israeli general from the Lebanon war. Might be a good reason Putin is trying so hard to replace that government. Barak replaced most of the generals during the past year. Not talking much but working hard. Bombed Syrian nuclear reactor and working with US to go after Iran; set them back with bombings as they don’t have the money to rebuild so fast. Egypt post-Mubarak is a question mark. Hizbullah is a spent force in Lebanon. Everyone hates them and the Iranians haven’t been putting their money down as much as they talk. Reason people talk up the threats is to get higher budgets for the military. (Ed. Note Dec. 10: But see Stratfor’s report on Hizbullah in late November that shows clearly they are rebuilding and looking to be used again.) Olmert very confident and stable; had just spoken with him 48 hours before meeting me. Ayalon of Labor is a lot of hot air. Bibi is quiet; Watch Meir Bar-On and Tzachi Hanegbi. The Cherut Mafia of Jerusalem is today running the country after fighting each other for 40 years. Livni and Meridor are wimps. Olmert delivers politically what he promises and keeps a deal once he makes it though he may doubledeal until he makes a deal. Very practical and economically astute and knows how to make a good show to keep investors happy such as to give Abbas 200 policemen parading around Nablus. He will give Abbas stuff because Abbas is weak and wants to have something to show. He will give them 27 villages around Jerusalem and stem them in Gaza. Leave Hamas alone there. Israel hasn’t really built the Wall for the past 2 years but except for Nablus the Arabs are frustrated on their own and not even trying to run suicide bombers into Israel. Only kids under 18 who don’t have families are high risks today. Americans will financially and then diplomatically isolate Iran and then, with Israel, bomb them. Already coordinating with Arab air forces. All Arabs are begging the US to go after Iran, especially the Saudis. Jordan seems stable but you never know. Israeli economy booming; lots of infrastructure planning in Jerusalem; first time in 40 years they are really building new stuff such as skyscrapers, bridges – in 10 years you won’t recognize the place. All the investigations on Olmert will turn up nothing and he ignores them; there is a lot of ego by the various investigating authorities and they have to do something to justify their existence. Olmert is an attorney who did deals; not the usual thing for Israeli politicians; it is why he seems dirty but what could you expect? Putin is a nothing nuisance with no real military. 

Gershon (peace activist and private channel to Palestinians of all stripes)...US not looking for a war with Iran, just to clean up Iraq. Lots of pressure on Israel as far as Annapolis summit; Olmert, Livni, Bush and Rice need a success or Olmert & Livni will lose their jobs. Olmert and Abbas have already agreed on the broad finalities but have to agree as to what the summit should produce as an interim step. What the Palestinians want is greater than what Olmert can give. For example: They want 100% of 22% of Palestine and recognition of the UN Resolution 194 which speaks of Right of Return – something Livni is totally against. Amos Gilead is Barak’s technical man on Livni’s team and Livni is not a detail person and he on behalf of Barak wants the whole thing sabotaged. Giving back Jerusalem neighborhoods has Lieberman’s support. Jordan is becoming a real police state – Damascus is now more free than Amman. (I’ve heard others disagree with this.) People say that Assad is not an Ahabal (imbecile) but smart. US now wants him in Annapolis and shutting up Meshaal this past week is Assad’s way of showing that he’s ready to play ball. Indeed, as I am writing this a week later, I hear that Assad is to be invited and to show up. Fayyad’s popularity is now at about 60%. Hamas is losing ground in Gaza and may be yet overthrown. If Abbas gets the goods from Israel, he could gain popularity and run a decent government. So far, the Palestinians see nothing and they are trying to figure out which roadblocks Barak says he removed. Hamas is a waste of time to deal with; they made a fool of Gershon by demanding a list of 1,000 prisoners from Israel from which they would choose 440 for the Israelis to release. The Israelis gave Gershon the list and then Hamas refused to accept the list. Gilead Shalit (the Israeli soldier held by Hamas) is in a bad position; Hamas insists the Egyptians mediate; they don’t want to mediate; the Israelis agreed to direct talks via Gershon and then Hamas wouldn’t agree. Nobody wants to give Hamas credit for anything, so Shalit must wait. Sorta stupid and sad. (Editor note Dec. 10: And then a month later Egypt stabs the PA in the back by arranging for pilgrimmages to Mecca of a bunch of Hamasniks in Gaza without coordinating it with the PA. Go figure.) Talks in DC this month to figure out what to talk about at Annapolis; the outcome must be agreed in advance. Syria should be there; better to piss inside the tent. Gershon thinks that Bar-On (Oded’s favorite) is a sleaze bag; Tzachi Negbi is not prime minister material but he likes Livni and Meridor. So you have two totally different opinions on this one. Israel will need to clean up Gaza militarily; Abbas can’t do it. Israel cleaned up West Bank in 2002 and therefore it can do this job. Hamas can’t take over the West Bank as it doesn’t have the military means or political support and there isn’t enough money around for the Palestinian Authority heads to be very corrupt these days anyway. Thinks that lynch mobs will trash Hamas in Gaza. Meanwhile, don’t talk to them and keep them penned up. Europe will not talk to Hamas anymore. The American officials visiting Israel prefer the Citadel to the King David – they like the 10th floor gym where General Dayton and others work out and they like the garage entrance so that they don’t have to go through the lobby to get to their rooms. Also the TV’s get all the news channels unlike the King David. Food at the American Colony Hotel in East Jerusalem is lousy, he says, but it has charm and good service; the Ambassador has decent food (he throws a good deal of functions). The light rail system in Jerusalem was installed faulty and has to be redone. Tel Aviv is also rebuilding and even more fun these days. Thinks Olmert will fall if Annapolis fails and if he has no success to counter the Winograd report and if Arabs get frustrated and stir up trouble. Agrees the separation wall is not being built these days and that Arabs are not trying suicide bombings for now, but that could change – hopes the attitudes in Gaza will change if people foresee a decent future. Iranians are shutting down any private avenues for talks by arresting anyone who goes to a conference. Ron Arad is dead, according to Dirani, a Hizbullah officer being held by Israel. 

Spoke with Guri (sabra cousin), Itzik (director of communications for a prominent NGO) and Khamis (an Israeli Arab with security clearance) – They differ as to whether terror ceased due to army operations or moral decision but agree that the Arabs these days are afraid to try very hard or that they are getting caught or pre-emptively killed. Barak is doing very well with his proactive operations and all that he is doing is buried news. Gury is happy that Jerusalem should be divvied up; it is anyway long divided and he is quite happy having Gaza split off. All agree that Hamas is not worth talking to. Khamis can’t stand Khaled Mashaal in Syria; says Amman is more fun at night these days than Tel Aviv. The accusations against Olmert are really exaggerated – the value of his house compared to other houses in the neighborhood is what people should look at, and he didn’t really profit all that much. On the bank shares, there is no evidence that anything he did had any effect on the ultimate transaction. (That investigation was since dropped.) 

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