Politics, United Kingdom

Brexit: Will it really happen?

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Britain is going for another referendum on June 23rd to decide whether to accept the EU reforms or leave the EU. On the street, people are referring to the referendum as the Brexit and the real question is: Will it really happen?

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I really don’t think so.

Since David Cameron declared that he would re-negotiate the relationship with the EU in 2013, I see the whole process as a well-rehearsed theatrical play. There are some good cops and bad cops in the play, but the agenda and the outcome are very well planned ahead.

The good cops are the ones who are very happy with the “special status” obtained from the EU after hard negotiations led by David Cameron.

This group is very happy, since concessions have been obtained and the UK is now a “privileged” member of the union. Of course, nothing should be shown as having been won easily at someone else’s expense, so there the bad cops kick in and the theatre starts.

The other group of people are still not really happy with the EU after the “special status” and they want the UK to leave the EU regardless.

Within this group, there are two distinct sub-groups: genuine politicians who really want the UK to leave the EU, since they are populist politicians, without calculating the damage to the UK; and the others, there to play the bad cop for the drama or for their own personal interest.

Currently half a dozen cabinet members are in favour of leaving the EU; however, most of the cabinet members want the UK to stay in Europe. Boris Johnson’s decision to campaign to leave the EU was an eye opener for the political arena as well as the financial markets.

Sterling dropped from 1.44 to 1.39 against the US dollar.

If the referendum result is to leave the EU in June, David Cameron will be a definite loser and, since Boris Johnson is the strongest candidate for the Tory leadership, the probability that he will win the most desired seat earlier becomes significantly higher.

It is good to remember that this is not the first time that the British public has voted to stay in or leave the EU, and the Conservatives have a good record of being split on important issues, going back to the late nineteenth century and, more recently, the 1990s, when its own MPs prepared the end of Thatcher’s eleven year premiership. In other words, they opened the door for 13 years of Labour leadership.

The UK is currently the world’s fifth biggest economy and it is the fifth largest spender on defence. The EU takes almost half of the UK’s exports and the UK takes less than ten per cent of the EU’s. A decision to leave the EU will definitely harm both sides and a Brexit will create a more dominant Germany in the EU, which I am not sure many of the member states will be happy to see.

Arguably, it may open the door for other members to re-negotiate their status with the alliance, and the models of Norway or Switzerland could be preferable for future members rather than joining the union.

One may discuss the capabilities of the UK in the current world, but nobody can ignore that Britain is still a top notch leader when it comes to politics.

Why would such a political genius open the door for another referendum for Scotland to leave the UK, financial companies to relocate their headquarters and a huge volume of transactions to move out of the UK, especially at a time when “special status” has already been granted from the EU, thanks to Prime Minister David Cameron?

It is simply another well acted piece of theatre.

All the best from Singapore.

Sukru Haskan
Twitter: @sukru_haskan

Middle East, Politics

War in Syria

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Cartoon is originally published by The Economist

The war in Syria has been going for some time now.

Imagine there were no refugee crisis: would this kind of large scale crisis have bothered the developed world then?

The refugee crisis diverted attention to Syria as refugees started flocking into European territory through Turkey, and all of a sudden Europe had to welcome millions of refugees.

One should look at the root of the Syrian problem by looking into history. After the collapse of the Ottoman Empire, the British and French ruled the Middle East for a short period of time between 1923 and 1946.

Syria—built on the multi-ethnic, multi-religious/sectarian and, more importantly, the ethnic and sectarian differences of the administrative structure—has complex internal dynamics controlled by the collapsing authoritarian structures, which has resulted in a drift towards chaos and disaster.

In other words, Syria is a made up country where a line was drawn in the sand by the French to show its borders.

Even after 1946, France controlled minority groups in the country while Russia always kept Syria at arm’s length to have direct access to the Mediterranean Sea. As a matter of fact, Basher Asad’s father Hafez al-Assad allowed the Soviet Union to open a naval military base in 1971.

Currently many different parties are fighting in Syria and using the country as a place to exercise their own government policy. In brief, here is each country’s agenda.

Russia wants to make sure that it continues to access the Mediterranean through Syria.

Israel does not want the regime to change to an Islamic government where its sovereignty could be threatened through Golan Heights, as Syria is a neighbour of Israel.

Iran wants to make sure that the Shia population continues to live in the region peacefully.

Turkey generally believes that the northern part of Syria belongs to Turkey and there is a fear of a Kurdish state being built there.

France wants to continue to enjoy some privileges and have cultural and economic influence over the country.

The USA has become more serious about Syria since Russia officially got into the game. As there are no really significant natural resources there, such as oil, the US had no interest in the country in the beginning.

Saudi Arabia is flexing its muscles against Iran. Bear in mind what is going on in Yemen right now.

We have the Iraqi example from recent history in the region. After the war, stability could not be secured in the country, and therefore the transformation process is still in progress with no real deadline.

Elected governments must always be respected in any part of the world. For this reason, a secure election is needed in Syria to bring about a transformation. I personally do not see transformation without Assad, as there is no real counterparty other than Assad.

Would you like to deal with Free Syrian Army, YPG, Daesh or someone else as a counterparty or at least a somehow elected government?

Russia is definitely a game changer in the Syrian issue. The country’s involvement has only made a complex issue even more complex. There are a lot of questions and answers to be agreed upon unless we can move towards a solution in Syria.

  • What should happen to Assad?
  • How can we create a path for the immigrants going back to Syria after the war?
  • Will some groups that are fighting in Syria today get some concessions after the war?

Syria is now exporting terror to the outside world—Jordan, Lebanon, Turkey and Europe. The issue has to be resolved sooner rather than later.

These questions are complex questions with no definite answers. Only time will show us the outcome, and I hope it will not be a shameful landmark for humanity.

All the best from Singapore,

Sukru Haskan
Twitter@ sukru_haskan

Economics

Financial Markets in Q1 ’16

It has been a very interesting year for the financial markets so far…

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The market has tumbled quite a bit since the beginning of the year and financial and energy companies are the main losers.

Warren Buffet’s famous quotation is, “Be fearful when others are greedy and greedy when others are fearful.” Even though the current climate is quite fearful, I would personally continue to be fearful rather than greedy in the coming months.

Financials are getting sold off as the street is expecting loan books to deteriorate and non-performing loans to increase and energy companies are being sold off since the investors do not believe that the juicy profits will be there anymore for an extended period as all the commodities across the board have been sold off sharply since last year.

The market always likes to overreact to any news.

When there is a bull market, we overbuy and when there is a bear market, we stay overcautious. I think we are entering again another oversold era, but it may continue to stay as it is before getting any worse. (Do not forget that markets can stay irrational for an extend period of time.)

It is not a difficult prediction to make that the loan books are likely to deteriorate as the exposure to energy and other challenging sectors will likely bring some defaults in the near future.

It is almost impossible to predict the price of oil as the price has been affected by many factors rather than the simple supply and demand mechanism, but the longer the oil price along with other commodity prices continue to stay low, we will continue to experience more defaults. Due to this simple fact, I would rather try to get away from energy company bonds as much as possible, as well as heavily commodity dependent countries such as Venezuela.

FED hiked the interest rates last December; many analysts started expecting three to four hikes in 2016. I don’t see that this is now happening. I would look for a one rate hike if we are lucky this year. Any aggressive stance from the Fed may shake the markets in a much uglier way.

The 10-year US interest tumbled as low as 165 basis points, which is clearly a sign that the money is again flowing into “safe havens”.

In 2015, many analysts were recommending getting into equities as they were seeing more value in equity markets than in the bond market. Those analysts were again wrong because since the turbulence start happening in June 2015, the bond market has performed relatively well compared with other asset classes.

We are living in such a different era that nowadays many banks are charging their clients to deposit EUR, JPY and CHF with them.

In the debt market, the EM debt crisis is approaching closer and closer as the currencies of these countries depreciated along with the revenues and it will be real challenge to produce USD for the repayment of the interest and the principal. Investing in quality names in the debt market will continue to be the challenge and one should not go simply for a high yield.

USD is very likely to continue to be a main beneficiary as with the last few years.

The spotlight is on “China”, but China is relatively doing better than its peers and I think the spotlight is again focusing on the wrong place.

Beside all these challenges, Syria is likely to teach an important lesson to human history. When there is a war, what happens to financial markets is not a difficult question to answer. Maybe gold is returning to its shiny days because of that?

I would keep a large portion of my assets in cash along with buying some (5–10%) gold at these levels. I would actively seek an entry point for blue chip companies with a target holding period of three to five years. The lowest point the market hit was on 5 March 2009, and I would wait for that kind of a day carefully. In addition, high quality debt papers that can pay continuously 4–5% are still not a bad asset to hold for 20–25% of your portfolio.

This is a period where you should protect your wealth rather than making a risky bet.

I will be travelling in Kuwait and Istanbul this week before coming back to Singapore. Have a wonderful week ahead!

All the best from Singapore.

Sukru Haskan
Twitter: @sukru_haskan

 

 

Economics, History, Personal Development, Technology

Book Review: Sapiens by Yuval Noah Harari

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A couple of months back, I published my next five books to read and one of them was Sapiens. Since this week marked Chinese New Year (Gong Xi Fa Cai!), it was a great opportunity to read Sapiens over the four-day break. I will share some of the author’s own sentences with my own comments and I hope that you find it interesting enough to read the whole book.

The author, Yuval Harari, divided the book into four different parts according to humankind’s developments: the cognitive revolution, the agricultural revolution, the unification of humankind, and the scientific revolution.

“The cognitive revolution kick-started history about 70,000 years ago. The agricultural revolution sped it up about 12,000 years ago. The scientific revolution, which got under way only 500 years.”

The author argues that prehistoric humans were insignificant animals with no more impact than gorillas, fireflies and jellyfish, and our closest living relatives include chimpanzees, gorillas and orang-utans. Legends, myths, gods and religions appeared for the first time with the cognitive revolution.

The transition to agriculture began around 9500–8500 BC in the hill country of south-eastern Turkey, western Iran and the Levant. Yuval believes that the agricultural revolution was history’s biggest fraud since the average farmer worked harder than the average forager, and received a worse diet in return.

He names this fraud as the luxury trap by stating that, “The pursuit of an easier life resulted in much hardship, and not for the last time. It happens to us today. How many young college graduates have taken demanding jobs in high-powered firms, vowing that they will work hard to earn money that will enable them to retire and pursue their real interests when they are 35? But by the time they reach that age, they have large mortgages, children to school, houses in the suburbs that necessitate at least two cars per family and a sense that life is not worth living without really good wine and expensive holidays abroad. What are they supposed to do, go back to digging up roots? No, they double their efforts and keep slaving away.”

He rightly argues throughout the book that worries about the future became major players in the theatre of the human mind.

“So why study history? Unlike physics or economics, history is not a means of making accurate predictions. We study history not to know the future but to widen our horizons, to understand that our present situation is neither natural nor inevitable, and that we consequently have many more possibilities before us than we imagine.”

So true… Everything is happening because of a series of past events and it is important to evaluate the reasons and continue our lives accordingly.

The scientific revolution started with human beings accepting the Latin injunction ignoramus, in other words “We don’t know”. This is still a huge problem in many countries as people think they know everything. Instead, when you accept that you don’t know enough, it opens the door to investigate, observe and learn.

He explains the necessities of holding societies together in quite a comprehensive way and explains why scientific revolution took place in Europe rather than anywhere else.

“In 1500, annual per capita production averaged $550, while today every man, woman and child produces, on the average, $8,800 a year.” 

The scientific revolution has definitely increased our productivity, but has it really improved the overall satisfaction of our lives as well? The book also discusses this point in quite a nice way as well.

“Each year the US population spends more money on diets than the amount needed to feed all the hungry people in the rest of the world. Obesity is a double victory for consumerism. Instead of eating little, which will lead to economic contraction, people eat too much and then buy diet products – contributing to economic growth twice over.”

This is another sad fact of our age. Because our distribution of goods and services channels are not well developed (or maybe we don’t want to develop?) whilst many people suffer from famine, some other people battle against obesity.

He argues that there will not be a large-scale war in the future, which I don’t really agree with. He puts forward the argument that the economical benefits of peace are so great that countries will avoid a large-scale war. Even though the economic benefits of peace along with social benefits are huge, these benefits are being shared by only fraction of the world’s population. Due to this fact, I personally expect a large-scale war to arise from low income people if these issues are not addressed immediately.

He finishes his book with a question: “Is there anything more dangerous than dissatisfied and irresponsible gods who don’t know what they want?”

Overall, the book enlightens us about the series of past events that took place in the history of the humankind and it helps us to think why certain institutions, beliefs and behaviour exist in our lives.

I rate this book 5/5 and recommend you to read it as well. Yuval Harari also has a website where you can watch his videos and even subscribe to his public courses.

All the best from Singapore.

Sukru Haskan
Twitter: @sukru_haskan

Asia, Singapore, Travel

Weekend Get Away – Bintan Island, Indonesia

Since I was expecting my baby, we had been unable to travel around much over the last month, and it is not easy to travel with a newborn.

The desire and intention to travel has been always there for our family so we decided to go for a quick weekend getaway to Bintan Island in Indonesia.

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A lot of my visitors in Singapore ask me where they can go from Singapore easily. This is the easiest option to travel from Singapore, since it only takes 45 minutes by boat to reach the island.

I booked the ferry tickets through Bintan Resort Ferries (www.brf.com.sg). The booking process was a bit complicated, as the website requests all passengers’ passport numbers, passport expiry dates, etc.

I had been to Bintan in September 2013 where we stayed at Bintan Lagoon Resort and we were not happy with our experience. The property was old, the breakfast was awful and it was overpriced.

Bearing in mind the previous experience, I booked the Angsana Hotel for this visit.

The ferry leaves from Tanah Merah ferry terminal, which is very close to Changi Airport. The immigration process is fast and smooth at the ferry terminal. We took the ferry out at 08:10 am and luckily we found a good spot on the ferry as we needed mobility because of the baby.

After almost an hour, we arrived at Bintan. Among the changes since our previous trip, Indonesia has initiated visa free travel to many nationalities, including those with Turkish and British passports. Before, there was a visa check on arrival and you would need to buy a visa for USD 15. Getting the visa was easy, but the queue and securing the exact USD 15 was a bit of a hassle.

Once we were through immigration, the hotel had arranged a complimentary transfer from the terminal. Angsana is only ten minutes away from the terminal, which was great.

The hotel is in an old complex and has a friendly staff. It has a long private beach and is situated just next to the Banyan Tree. We were able to access our room before the standard check-in time and headed to the beach, where there is a nice restaurant.

The menu is quite simple there but the food is good. Unfortunately, like anything in Bintan, it is very overpriced, though.

The hotel provides beach chairs along the beach, with towels. Even though the sea in Southeast Asia is not my favourite, given that it is hot and not crystal clear, it is nice to lie in front of it and relax.

We visited the Saffron restaurant—which is inside the Banyan Tree—for dinner. I should say the highlight of this trip for me was this restaurant. Perfect food, nice ambience and great service.

Even though we had some small communication problems at Angsana Hotel, I would say they are fairly friendly and do try their best to make sure you feel comfortable. On the way back, they arranged a private transfer for us to the ferry: since we had our newborn with us, it was a great gesture.

In Bintan, everything is overpriced. Proximity to Singapore and an easy tropical escape make the place popular so the prices are high! Once every two years, though, it is a good place to visit.

If you are visiting Singapore, I would recommend that you spend two or three days in Bintan.

All the best from Singapore.

Sukru Haskan
Twitter: @sukru_haskan

Economics

Convergence in Economies, Is it really happening?

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In my third year in university in 2004, I followed the Economic Development course delivered by a very good professor, Elif Çepni, in Istanbul. I remember her telling us about the convergence in economies over time.

The concept is pretty simple and logical. It is the hypothesis that the emerging market economies and developed market economies will in the end converge in terms of GDP per capita. The underlying reasoning is that the rate of the growth in the developing world is higher than the rate of the growth in the developed world.

Have developing economies really been catching up with the developed economies since 2004?

 

The share of the developing world’s population living on less than $1.25 a day (the international definition of poverty) has fallen from 30 per cent in 2000 to below ten per cent according to an estimate by the Centre for Global Development, based on new data published by the World Bank in April 2015.

According to an article in The Economist in 2014, were the emerging world able to maintain a 4.5 percentage point growth advantage over the rich world, then, all other things being equal, its average income per person would converge with that in America in just over 30 years—scarcely a generation.

Unfortunately, since the global financial crisis in 2008, a lot of things have changed. The growth rate of emerging market economies has slowed down and the convergence has faltered.

Growth rate is not the only factor, but it is one of the main reasons that convergence is not happening. Emerging markets have been still dealing with implementing efficient governing policies, productivity levels (technology) and rules of law.

Red tape in emerging markets is very high and corruption does not really help. According to a recent report by Transparency International, emerging markets continue to be more corrupt than the developed world. This reports highlights that Brazil and Turkey have seen the largest fall in terms of cleanliness in the last four years.

Unfortunately, corruption leads to less productivity, and less productivity leads to poor citizens, which in turn leads to less educated communities and bad governing policies along with weakened rule of law.

It is a vicious circle for emerging markets.

I personally believe India has very much potential, but with the current red tape level (opening a business is one of the hardest), the potential of the country is still not being realised. President Modi has been elected to change this, but easier said than done: it will take time.

A paper written by Harvard economist Dani Rodrik in 2011 argues that generalized, rapid convergence is possible in principle, but unlikely in practice. His baseline scenario has to be one in which high growth remains episodic. Sustained convergence is likely to remain restricted to a relatively small number of countries. I totally agree with his conclusions.

According to an Oxfam report, the combined wealth of the richest one per cent will overtake that of the other 99 per cent of people next year unless the current trend of rising inequality is checked. Oxfam made headlines at Davos last year in 2015 with the revelation that the 85 richest people on the planet have the same wealth as the poorest 50 per cent (3.5 billion people). That figure is now 80—a dramatic fall from 388 people in 2010. The wealth of the richest 80 doubled in cash terms between 2009 and 2014.

 

A prominent Turkish conglomerate, Ali Koc, has mentioned in a conference that we have to sort out the inequality in the system in order not to face bigger problems in the near future. The existence of large inequalities always open the door for correction, which may lead to a global war. The migrant crisis, for example, is an early symptom of this.

Sustainable growth is unlikely, so it will remain just a hypothesis. It is true that we have more middle class now, but we have still one in nine people living below the poverty line (less than $1.25 per day).

On the other hand, there are some voices claiming that the emerging markets’ catch-up with the developed markets will continue into the 2020s. A prominent economist, Kemal Dervis, believes it is not the end of the party for the emerging markets yet.

As a final note, I would like to share with you Dani Rodrik’s 2013 slides about the subject, with which I completely agree.

With low commodity prices; capital flowing back to the mainland; the Chinese slowdown and discussion about whether the landing will be soft or hard; geopolitical developments in the Middle East and Russia, it is likely that the growth rate of the emerging markets will be surpassed in the near future.

This weekend I am in Bintan, a beautiful island just one hour away from Singapore. I will write my observations about the island and my short journey next week.

All the best from Indonesia.

Sukru Haskan
Twitter:@sukru_haskan

Life, Personal Development

Inspire, Trust, and Do Business!

Interaction plays an important part in our lives. We interact with friends, colleagues, strangers and family members. Each interaction creates good and bad feelings in us and, most importantly, each interaction has social or business impact on us.

Since it is important to interact, how can we make each interaction efficient in our social and business lives?

We human beings are strange and unique creatures and we like to interact with people that we like. We always try to find common points with the people with whom we interact. Finding a common point is a good ice breaker when you meet a stranger.

Through my life experience, I have found that I like to interact with people that I get inspired by. A person that pushes me to think differently and helps to enhance my vision always manages to gain priority in my life. Interestingly, when I look back and think, I chose my friends and my best colleagues through this inspiration channel.

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How can you inspire a person?

You may use your status in the community, such as the CEO of XXX, or your financial strength, such as being one of the thousand richest in the world, but this is not really influential in the long term. Given that status in the community and financial strength can be lost in a day, they are not really a permanent inspirational asset in a human being.

Is it a coincidence that many rich people are left alone when they suddenly become poor? Or that a retired Prime Minister or a high level business executive starts living an ordinary life?

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I believe that a permanently inspirational character exists when you have a vision and continual viable ideas that you can share with people. I don’t mean that you have to be a scientist or an innovator; most importantly you have to have a strong ability to make good observations of people, understand developments in economics and politics or other types of social sciences, and implement these new ideas into people’s lives while taking into consideration the history and other aspects of your counterparty.

Easily said. But once you have all these skills, you are a candidate for a good leader, a mentor and a friend for everyone. I believe that acquiring these skills requires a tremendous amount of energy and motivation and a desire to update yourself constantly. A lot of people want to achieve this, but since it is long journey, many of us turn back while we are still quite close to the start.

When you inspire people, it is much easier to build trust. You don’t really have to work on building trust, since a person inspired by you will be much open to listening more to you and will be more willing to spend time with you.

And once the trust is built, it is very easy to do business with those people.

Instead of inspiring and building trust, if you want to jump to a conclusion (in business), it is very likely that you will fail. Even if you don’t, it will not be a very long term relationship.

A good leader or mentor should be able to inspire their subordinates with their vision and way of living—otherwise that leader is just an ordinary leader, and most likely he will be left alone once he gives up his status in the community. And a good friend should be able to show you new ways of looking at things while having a good time.

A lot of people are advising that you split your social and business circles, which I strongly oppose. Conversely, combine your social and business circles!

It will definitely create more synergy, as one plus one sometimes does not equal two. In addition, doing business within your social circle is a good test to see how much your friends are inspired by you.

All the best from Singapore.

Sukru Haskan
Twitter:@sukru_haskan

Economics, Life, Technology

Autonomous Cars: Are you ready?

I love technology and I hate driving. The inclusion of both love and hate presents a conflict, but the two can help each other in numerous ways.

Many news stories have recently emerged regarding autonomous cars, which makes me very excited. Having lived in Istanbul, London, and briefly in Zurich and Singapore, I know that the traffic can be annoying; in Istanbul, the commute can be trying.

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According to CNN, commuters spend 125 hours per year stuck in traffic, which is not an acceptable way to live one’s life. Since, when driving, we are in front of a steering wheel, we cannot be effective during those hours: this is a perfect way of explaining the term “waste of time”.

At present, technology is evolving, will continue to ease our lives, and, most importantly, enable us to be more effective.

Autonomous cars are breaking into the market in a big way. In other words, driverless and fully robotic cars will soon be widely used.

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Silicon Valley has become recently one of the top destinations for car companies. An increasing number of conventional car companies are teaming up with technology companies to explore this market. If they do not make this transition, conventional car companies are at risk of having their market captured by companies like Google.

Google has been testing the driverless car technology for some time now, and Ford has just tested its own autonomous car in snow!

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The CEO of Tesla, a revolutionary car company, believes that fully autonomous cars will be hitting the market shortly. In fact, Tesla is preparing for an immense test drive: from one coast to the other in the US. “If you’re in New York and the car’s in Los Angeles, you can summon your car to you from your phone and tell the car to find you, and it’ll automatically charge itself along the journey,” Tesla’s CEO said on a conference call prior to the Detroit Auto show this week.

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Not only will the technology enable us to be effective in terms of our time, it will help us to be safer. Specialists believe that autonomous vehicles will be significantly safer than human-driven vehicles. Toyota is another car company that is exploring the options in this market.

It is scary, but whatever industry you are in may be swallowed by a tech company in the next decade. Thus, perhaps it is better to collaborate with them rather than trying to compete with them.

Consider an example: banks. Conventional retail banks are at risk of being swallowed by fin-tech companies if they lag behind the curve in the coming years.

Fiat Chrysler’s CEO, Sergio Marchionne, stated that carmakers risk losing proprietary control. He said, “Having initially manufactured all their own components, carmarkers currently retain primary control of making only vehicles power trains – their engines and transmissions. If we start losing any of that … we will not be able to hang on to any proprietary knowledge and control of that business.”

On the other side of the coin are drivers, whose responsibility will be overturned shortly. It will be difficult to reallocate workers in low-skill positions in the next decade. Governments should prepare training programmes for these people to ensure that they continue to have a place in the economy. Otherwise, while these improvements are positive, they may create conflicts.

The world is becoming a very competitive place, and survival for the weak is becoming difficult.

The Detroit Motor Show began this week, and it will be interesting to watch: not because I am interested in cars, but because I am interested in the current evolving technologies.

All the best from Singapore.

Sukru Haskan
Twitter: @sukru_haskan

Europe, Travel, United Kingdom

A weekend in London – What would I do?

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I lived in London for 7.5 years and I became a true Londoner in this period of time. Since I have been living in Singapore for the last 2.5 years, I sometimes miss London, and whenever I have a chance to go to London, it is a great opportunity for me to get into my old routine for a few days.

What would I do in a weekend in London?

London, the capital, is a place where new ideas are generated so it is a place to visit museums, shows, restaurants but, most importantly, bookstores. You will not get any night life advice here.

In a typical weekend, I would start my day walking to Marylebone: this is my London centre since I lived in Bickenhall Street for 3.5 years.

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Marylebone is a very special place for me as I have a lot of memories of every single corner of it, and my first visit would be Daunt Bookstore on Marylebone.

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Technology is evolving and many argue that books will be history, since a lot of people have already shifted to e-books. Daunt Bookstore definitely fights quite strongly against this idea.

It is a great place for me to spend a couple of hours. It is an Edwardian bookstore with long oak galleries. This bookstore specialises in travel books, but there are other sections such as history and literature. I love to look through its travel books, but I would always buy a history, politics or economics book over a travel book. Since this is my first stop early in the morning, I won’t buy any books but I decide on what to buy on my return.

Now the long walk to Hampstead starts.

I cross the Marylebone Road and reach Regent’s Park, where I spent many of my early mornings and late nights. Through Regent’s Park, I reach Prince Albert Road and then I continue to walk towards Hampstead. The nonstop walk will take about an hour to reach beautiful Hampstead Heath.

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My stop would be at The Wells, a gastropub, by Hampstead Heath. It is a family friendly pub with an evolving menu. I would stop here for an hour or two before heading back to Marylebone to buy the books that I decided to buy earlier.

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I find a lot of similarities between Marylebone and Hampstead Heath. A boutique cinema chain (Everyman) and my favourite bookstore Daunt Books are only two of them. I feel both have distinct characteristics, not like Chelsea, and they are both true London boroughs.

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The time would hit 4–5 pm now and I would have to go and leave my books and maybe rest a bit. I have a lot of favourite restaurants in London, and I would prefer Big Easy on Kings Road, Alounak in Westbourne Grove or a new London restaurant recommended by a friend.

If I could a squeeze in a theatre at night, that’s perfect. Sometimes it is quite difficult, but I would definitely try.

The walk should take about 17–18 km that day. In other words, around 35,000 steps. Not too bad! And thank God that London is flat.

I would wake up as early as possible on my second and final day in London. I would try to go to Trafalgar and Covent Garden, to walk without any aim. Then I would walk to Parliament and would cross Waterloo Bridge.

This would enable me to walk towards London Bridge and should take about 45 minutes. On my way, there are the Tate Modern, a nice pub by the river, Shakespeare’s Globe Theatre and Vinopolis—which I heard that it is closing down.

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Lunchtime should be about there and I would take a cab or a tube from London Bridge and go to my favourite spot once more, Marylebone. My lunch would take place at Casa Becci, an authentic Italian restaurant run by an Italian family for a long time.

casa-becci-restaurant

It is a very simple restaurant and price friendly, but, most importantly, great simple Italian food. My favourite here would be Spaghetti Aglio E Olio.

Unfortunately, the weekend has come to an end. I have to take a flight to continue wherever I need to go. I should walked about 15,000 steps that day, or in other words 10–11 km. Not bad!

London is not an easy city to live in, but it is definitely one of the best!

P.S. Most of my walking sessions started at Chelsea Bridge Wharf over the last three years as my beloved friend, Hakan Dikmen, kept hosting me without grumbling. Thank you, Hakan—you are such a great host!

All the best from Singapore.

Sukru Haskan
Twitter: @sukru_haskan

Economics, Life, Personal Development

The Psychology of Excessive Luxury Brands Purchase

4 Comments

Why do people buy an excessive number of luxury brands and spend so much money on these items? Not only rich people, but amazingly poor people save money to buy a branded handbag or a pair of boats.

For instance, I happen to know a lady who earns $1,500 per month and bought a bag for $5,000. Why?

Woman sitting on sofa surrounded with shopping bags

Since I believe one of the biggest social problems this century is improper distribution of goods and services, I have observed the buying patterns of different nationalities for many years.

Many of us want to feel ourselves special. No matter whether you are rich, poor, young or old, you want to be treated as someone special. It is a basic psychological state of human beings. In addition, many people want to prove to the outside world that they are different and important.

This pattern of behaviour mainly occurs when an individual is not really fully satisfied with their friends, their work, their own intellectual capacity or even how they spend their life. On top of that, if that individual feels that they are lagging behind their peers, many could choose to reduce the gap by showing off through luxury brands, luxury holidays or material stuff such as cars.

Actually, much of our surroundings is just a sense of feeling, and everything is psychological.

Of course, there are reasons behind this pattern of behaviour.

  • If a person suddenly gets rich and if they come from an underprivileged background, they may tend to exaggerate to get attention. All of a sudden, something (money) has become the only thing to get attention. Before, there was nothing to differentiate them, and they think now they have everything (money!) to get attention.
  • When they are not sure how long their wealth will hold out and they want to make the most of it by showing off. This happens mainly in emerging market economies, where governments choose some people to get rich. In other words, these people have not really achieved anything: they are simply chosen, and sadly they are unaware of it.
  • Everybody tries to establish a social status in their community. Whether you are rich or poor, you want to be respected. Here is my explanation as to why a poor person who should not buy that $5000 bag buys that bag—because they think they will be treated like rich people. They actually think that they are closing the gap between themselves and others! Actually, they are opening the gap even further by becoming poorer.
  • Last but not least, another reason is these people do not have anything better to do for themselves—and, more importantly, for their communities. Since intellectual capacity/ability is built over years, it takes time. As human beings, we take the easy route to earn respect.

I find distinct similarities between people who try to feel good and gain status through excessive buying of luxury goods and people who get married to very beautiful ladies with no education and proper life, or to fat ugly gentlemen with a lot of money.

In the end, the relationship is very artificial and does not survive in the long term.

Moreover, an institution such as marriage should create happiness, but in the end, this type of relationship only creates miserable and unhappy lives.

I personally adore those people who are respected in their communities for their knowledge and their own unique characteristics rather than for what they own. A family friend in London taught me several years ago that my wealth should not be my car and what I wear, but it should be my own intellectual capacity.

A Turkish foundation, Darussafaka, is currently running an excellent advertisement on Turkish TV channels. The title is “You can still survive without it”. A lady goes to a shop and likes a bag; a businessman goes to another shop and likes a pen; but they both say “I can still survive without it”. Then the ad continues that you can survive without many things, but not without the proper education of our children.

I want to make it clear that this article is not about criticizing any type of behaviour or a certain type of person. It is solely written according to my own personal observations. It is purely an attempt to produce an amateur socio-economic article.

In addition, I too occasionally enjoy buying some branded clothes and shoes—hopefully, though, not excessively.

I hope this article leads you to contemplate whether you overspend on luxury brands and perhaps encourages you to channel some of that spending into education or the other basic needs of the many.

All the best from Singapore.

Sukru Haskan
Twitter: @sukru_haskan