East Eats West

Switzerland's Alinghi defends America's Cup

Picture: The owner and team-leader of the Swiss sailing team Alinghi, Ernesto Bertarelli.

Today Switzerland's sailing team Alinghi successfully defended the America's Cup. Congratulation! Not only is it astonishing that a land-locked country like Switzerland won the world's most prestigious and oldest sailing trophy (okay, we had many excellent New Zealanders help us). The truly astonishing thing is that the team-leader and owner, Ernesto Bertarelli, a multi-billionaire originally from Italy, sold his biotech company Serono in order to join the sailing team full-time. In contrast to Oracle's Larry Ellison his is not only another big-pocket spender but also thorough and valuable team member. He realized something very important: all the money in the world does not buy you happiness. In order to achieve happiness you have to accomplish something, not only buy it. He gave up his company in order to excel in a complete different field: sailing. For giving up his company and dedicating his life to his dream he is among the most inspirational leaders there are today. Bravo, Mr. Bertarelli, bravo! I hope you will find many followers! Go Alinghi!

www.alinghi.com

Threatened with arrest

Picture: The gentleman of the public transport authority in the yellow vest wanted me arrested.

Sometimes using public transport is a thrill. This is what happened recently: The city police does several times a year heavy checks (Schwerpunktkontrolle) in areas with high people flow. I live next to such a hot spot where such a checks was in progress. This spot, Höschgasse, a tram station, is known for secret drug dealing also. So as I got home from work in the tram each disembarking passenger had to show its valid ticket to the control agents and the police, which I did. At the same time I took some pictures until a miniscule agent threatened me with arrest and the confiscation of my camera. I ignored him and took some more pictures. And he got more angry. As I have the right to take pictures (just no portraits) the police officers did not react. I must say that I got a bit excited about my unruly behaviour and I was already picturing myself using my self-defence techniques against the agent. Then again I thought I should not ruin my Italian suit.

Picture: Police and public transport working hand in hand in order to arrest unruly citizens as me.

Decommissioned Bloodhounds

Picture: Anti-aircraft missiles type BL-64 code-named Bloodhound.

During the Cold War Switzerland’s military placed six English BL-64 anti-aircraft missiles, code-named Bloodhound, across Switzerland. The system got decommissioned in 1999 and one missile base near Menzingen (Canton Zug) is nowadays open to the public. I shall go and visit again with my visitor from Malaysia as she digs Swiss bunkers and military fortifications. Yes, we Swiss love to dig big holes!

http://www.mhsz.ch/

How to get rich – Part II

In a former entry I explained quickly how private equity company make money, big money. But not only the private equity companies (PEC) make money. PEC need specialist-CEOs to engineer the turn-around. And they get rewarded. Recently a leading international top executive search agent told me that a CEO can earn $20-30mio. as reward for his few years of hard cost-cutting and financial engineering. So it is wrong that only your own company or an inheritance can make your rich. If private equity and such lavish salaries are eventually good for the acquired company might be disputed. Some bloom as Ducati Motorcycles or Bally Fashion of Switzerland, others like Hertz car rental basically are leveraged to death. Anyhow, as soon as interest rates will go up and the economy will slow down, leverage will see its end (at least in this boom-cycle).

How to get really rich – Part I

Have you ever wondered how to get rich? Have you even read some books like “Secrets of the Millionaire Mind” by T. Harv Eker or “The Last Chance Millionaire: It’s not too late to become wealthy” by Douglas Andrew? Well, let me be frank. There are only two ways (for men) to get rich: inherit or start your own company (women can also divorce). And if you want to start a company and hit it big time, better think big money. Think finance. Think private equity! And learn from Mr.Schwarzman. Mr.Schwarzman is the founder of the Blackstone Private Equity Group and earned $398m last year. And he convinced the Chinese government to $3bio. in his company. And he went public with his company and made about $8bio.

One uses the term private equity in contrast to public equity (companies listed on stock markets). How private equity typically works nowadays was explained to me recently by a CEO of a traditional Swiss industrial company: private equity companies for example buy an ailing but cash flow steady industrial company that cannot cope with globalisation anymore. The acquisition is made by using high leverage, meaning the private equity company (PEC) pays less than 20 percent of the price and let’s the acquired company raise the rest of the money in the form of low-interest debt happily provided by banks. In the first year the PEC then pays out a super dividend to the shareholders (themselves) and immediately recoups most of the initial investment. In the consecutive years the acquired company is constantly squeezed for cash in order to service the interest payments and dividends. Finally after about five years the company is trimmed to the max in order to dress for resale. And as a PEC you can expect anything between 20-30 percent of annual return (so far).

Magnificent Japanese presents

Picture: Wonderful Japanese presents.

Giving presents is an art-form in Japan and already the wrapping is a meticulous affair. As I had friends from Japan visiting me, I was so lucky to receive some unique Japanese presents: two handmade Japanese tea cups; a bamboo brush for preparing Macha (the green tea powder used to make tea at the tea ceremony); fish paste in the shape of a sausage that is absolutely exquisite and last but not least I got my beloved Furikake or Wasabi and seaweed seasoning that goes along fine with steamed rice. I feel like it is early Christmas! Thank you, Taki and Hiroko and see you again!

Smart shopping in Zurich

Picture: Time for bargain-hunting in Zurich.

The taste of luxury can be addictive. Since I bought my first hand-made Italian suit from Kiton and got to use the wonderful lightness of the jacket and the softness and coolness of the fabric. And the suit just hugs my body perfectly without limiting my movements. And quality as such comes with a price tag. Nevertheless is there a way around it: sale. And to my surprise the increased the discount from 25% to 40% for suits, shirts and pants (hurry, the sale is still on)! And ladies and gents if you want to strike a real bargain the Trois Pommes Vintage shop in Zurich offers second season designer clothes with a 60% discount, among other luxury brands for men and women. http://www.troispommes.ch/index.php?id=82