BOW WAVE 265

Bow Wave Issue 265--Seasonal Edition

news and views on trade, insurance and risk

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(c)2004 WavyLine.com	Issue No 265 20 Dec 04
Published free of charge to Readers
Editor: Sam Ignarski
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In this issue:

1. Welcome
2. Ghost of Christmas Future?
3. Totally Unfair Broker Joke
4. Beware the Xmas Parties
5. Downsizing the 12 Days
6. And Finally...

1. Welcome

We wish our Readers all good things and seasonal greetings.

New Readers this week include:

Capt. Peter Bird of Seabird Consultants in Singapore Kevin Somers of Inspectorate
Marty Levin
Glen Colaco of ANL
Brendan Hickey of Maritime Safety Queensland
Headhunter James Pettit of the Willis Partnership

News of Readers

Archie Smiley has formed an association with
Captain Duncan McKelvie's Quadrant Marine and aims to further the Technical side of the firm.

http://www.quadrant-marine.com)

Bob Judd of the Australian Customs Service is retiring

Captain Terry Ogg after 15 years with a leading marine law firm as a Marine Investigator & Consultant has started his own independent consultancy called Marine Professionals.

http://www.marineprofessionals.co.uk

Paul Sansom will relocate to WK Webster's Singapore Office in early 2005. This will be a return to his "second home" as he was for nine years the company's Resident Director there from 1988. He will remain a Main Board Director of W K Webster & Co Ltd and also takes on the newly created role as the Group's Regional Director. He will be primarily concerned with client liaison & business development. Additionally, he assumes strategic responsibility for the Webster Group's Singapore-based Cargo Services.

For further details contact:-

GNewman@wkwebster.com

Readers Write

Tony Slinn Writes:

The International Association of Ports and Harbors (IAPH) and Lloyd’s Register-Fairplay will be re-launching Ports & Harbors, the IAPH official journal, from March 2005.

Under the overall supervision of the IAPH Secretariat, Lloyd’s Register-Fairplay will take over responsibility for editorial, production and advertising.

Ports & Harbors will be published six times each year and will include the latest news and information on both the Association’s activities and the international port and maritime industry.

contact him at:-

tony.slinn@lrfairplay.com

Paul Clemenson,who is the Lead Analyst for Casualty & Demolition over at Lloyd's Register-Fairplay writes:-

I am enclosing a poem written by my 10 year old son. It was a winner in a Nationwide competition "What is Courage" and was read out by the actress Jennie Mcalpine at the Children of Courage service at Westminster Abbey last week.

Courage is....

To stand up to a mob of bullies alone, that is courage.

To keep going when it would be easier to give up, that is courage.

To rescue someone from a blazing building when the smoke is so thick you cannot see, that is courage.

To care for a loved one when they are sick and ill, that is courage.

To live your life disfigured and scarred with people staring and calling you names, that is courage.

To help a complete stranger when it could cost you your life, that is courage.

Courage is a spark inside all of us.

We each have a chance in our lifetime to show courage.

But only a hero takes it.

By Matthew Clemenson

By this time in the year a certain levity is called for. Thank you dear Readers for your support and encouragement during 2004. Working on Bow Wave is never less than a pleasure and a privilege. May all the joys and consolations of the season be with you.

Enjoy.

2. Ghost of Christmas Future?

Fred Doll writes:

Comparing current vessel prices and required breakeven earnings can provide useful perspective when evaluating recent market developments.

Indicative breakeven earnings requirements for a Panamax dry bulk vessel are estimated using five year economics with the following bases:

- $38 million as the price for a new or nearly new Panamax dry bulk vessel (probably a bit low, but helps to avoid overstating the breakeven earnings figures)
- 70% loan
- Interest at LIBOR + 150 basis points
- Annual principal amortisation at 3.5%
- Daily operating expenses at $4,500
- Vessel value at end of five years of $16.5 million ("average" value 1998-2003 for 5 year old Panamax) - Earnings are expressed on time charter equivalent basis
Indicative breakeven earnings required are:

- Cash basis (i.e. 38 million in, $38 million out, no interest or return):
$16,700 per day.
- Repay loan interest and principal, earn 12% on equity: $21,000 per day.
- "Big Score Case" - Repay loan interest and principal, earn 12% on equity, high earnings first 2 years, earnings revert to historical average* years 3 through 5: $33,500 per day in first two years.

*From 1994 through 2003, Panamax spot vessel earnings averaged about $10,000 per day.

Rigorous market analysis should be evaluated before exposing your company to this type of risk. Risks extend not only to vessel owners, but their bankers, insurers, and others during the current high market and later on should vessel values revert to more typical levels. Market analysis can help protect you by providing better understanding and management of risk.

These figures are excerpted from a recent presentation at the Seatrade Middle East Maritime Conference :-

http://www.dollship.com/Index.asp?Content=Presentations
Fred Doll is Managing Director of Doll Shipping Consultancy, providing market analysis, project evaluation, e-commerce expertise, and strategic planning to shipping companies, financial institutions and shipping service companies worldwide. .

3. Totally Unfair Broker Joke

Many thanks to one of our regular correspondents from the ranks of the broking industry during 2004, Nick Angus:-

Five men were bragging about how smart their dogs were. One was an Engineer, the second man was an Accountant, the third man was a Chemist, the fourth was a Computer Technician and the fifth was an Insurance Broker.

To show off, the Engineer called to his dog, T-Square, do your stuff". T-Square trotted over to a desk, took out some paper and a pen and promptly drew a circle, a square and a triangle. Everyone agreed that it was pretty incredible.

But the Accountant said that his dog could do better. He called to his dog and commanded, "Spreadsheet, do your stuff". Spreadsheet went out into the kitchen and returned with a dozen pies. He divided them into four equal piles of three pies each.

Everyone agreed that that was good.

But the Chemist said his dog could do better. He called to his dog and commanded "Measure, do your stuff". Measure got up, walked over to the fridge, took out a litre of beer, got a pint glass from the cupboard and poured exactly a pint without spilling a drop.

Everyone agreed that it was more than a little impressive.

The Computer Technician knew that he could top them all. " Hard Drive, do it". Hard Drive crossed the room and booted up the computer, checked for viruses, upgraded the operating system, sent an e-mail and installed a cool new game.

Everyone knew that it was a tough act to follow.

Then the four men turned to the Insurance Broker and said, "What can your dog do?" The Insurance Broker called to his dog and said," Long Lunch Break, do your stuff boy".

Long Lunch Break jumped to his feet, ate the pies, drank the beer, erased all of the files on the computer, sexually assaulted the other four dogs, claimed he injured his back while doing so, filed a grievance report for unsafe working conditions, put in for workers compensation and went home for a six month sick leave.

4. Beware the Xmas Parties

Thanks to Douglas Webster in Malaysia:-

Three men died on Christmas Eve and were met by Saint Peter at the pearly gates. "In honor of this holy season," Saint Peter said, "you must each possess something that symbolizes Christmas to get into heaven."

The first man fumbled through his pockets and pulled out a lighter.

He flicked it on. It represents a candle, he said.

You may pass through the pearly gates Saint Peter said.

The second man reached into his pocket and pulled out a set of keys. He shook them and said, "They're bells".

Saint Peter said you may pass through the pearly gates.

The third man started searching desperately through his pockets and finally pulled out a pair of women's panties.

St. Peter looked at the man with a raised eyebrow and asked, "And just what do those symbolize?"

The man replied, "They're Carols".

5. Downsizing the 12 Days

With thanks to Barbara Jennings:-

CORPORATE MEMO

To: All Staff
Date: December 1
Subject: New "Twelve Days of Christmas" Policy

The recent announcement that Donner and Blitzen have elected to take the early reindeer retirement package has triggered a good deal of concern about whether they will be replaced, and about other restructuring decisions at the North Pole.

Streamlining is due to the North Pole's loss of dominance in the season's gift distribution business. Home Shopping TV channels and mail order catalogues have diminished Santa's market share. He and the Board could not sit idly by and permit further erosion of the profit picture.

The reindeer downsizing was made possible through purchase of a late model Japanese sled for the CEO's annual trip. Improved productivity from Dasher and Dancer, who summered at the Harvard Business School, is anticipated. Reduction in the reindeer will also lessen airborne environmental emissions for which the North Pole has received unfavorable press (gas and solid waste).

We're pleased to inform you that Rudolph's role will not be disturbed. Tradition still counts for something at the North Pole!

Management denies, in the strongest possible language, the earlier leak that Rudolph's nose get red, not from the cold, but from substance abuse. Calling Rudolph "a lush who was into the sauce and never did pull his share of the load" was an unfortunate comment, made by one of Santa's helpers and taken out of context at a time of the year when they are known to be under 'executive stress'.

As for further restructuring, today's global challenges require the North Pole to continue to look for better, more competitive steps. Effective immediately, the following economy measures are to take place in the "Twelve Days of Christmas" music subsidiary:

1) The partridge will be retained, but the pear tree, which never produced the cash crop forecasted, will be replaced by a plastic hanging plant, providing considerable savings in maintenance;

2) Two turtle doves represent a redundancy that is simply not cost effective. In addition, their romance during working hours could not be condoned. The positions are, therefore, eliminated;

3) The three French hens will remain intact. After all, everyone loves the French;

4) The four calling birds will be replaced by an automated voice mail system, with a call waiting option. An analysis is underway to determine who the birds have been calling, how often and how long they talked;

5) The five golden rings have been put on hold by the Board of Directors. Maintaining a portfolio based on one commodity could have negative implications for institutional investors. Diversification into other precious metals, as well as a mix of T-Bills and high technology stocks, appear to be in order;

6) The six geese-a-laying constitutes a luxury which can no longer be afforded. It has long been felt that the production rate of one egg per goose per day was an example of the general decline in productivity. Three geese will be let go, and an upgrading in the selection procedure by personnel will assure management that, from now on, every goose it gets will be a good one;

7) The seven swans-a-swimming is obviously a number chosen in better times. The function is primarily decorative. Mechanical swans are on order. The current swans will be retrained to learn some new strokes,thereby enhancing their outplacement;

8) As you know, the eight maids-a-milking concept has been under heavy scrutiny by the EEOC. A male/female balance in the workforce is being sought. The more militant maids consider this a dead-end job with no upward mobility. Automation of the process may permit the maids to try a-mending, a-mentoring or a-mulching;

9) Nine ladies dancing has always been an odd number. This function will be phased out as these individuals grow older and can no longer do the steps;

10) Ten Lords-a-leaping is overkill. The high cost of Lords, plus the expense of international air travel, prompted the Compensation Committee to suggest replacing this group with ten out-of-work congressmen. While leaping ability may be somewhat sacrificed, the savings are significant as we expect an oversupply of unemployed congressmen this year;

11) Eleven pipers piping and twelve drummers drumming is a simple case of the band getting too big. A substitution with a string quartet, a cutback on new music, and no uniforms, will produce savings which will drop right to the bottom line;

Overall we can expect a substantial reduction in assorted people, fowl, animals and related expenses. Though incomplete, studies indicate that stretching deliveries over twelve days is inefficient. If we can drop ship in one day, service levels will be improved.

Regarding the lawsuit filed by the attorney's association seeking expansion to include the legal profession ("thirteen lawyers-a-suing"), a decision is pending.

Deeper cuts may be necessary in the future to remain competitive. Should that happen, the Board will request management to scrutinize the Snow White Division to see if seven dwarfs is the right number.

6. And Finally...

It is again thanks to Frazer Hunt in Sydney, this time for pandering to this e-zine's weakness for punning

FOR THOSE WHO ENJOY LANGUAGE (OR SEVERE DISTORTIONS THEREOF)

Those who jump off a bridge in Paris are in Seine.

A man's home is his castle, in a manor of speaking.

Dijon vu - the same mustard as before.

Practice safe eating - always use condiments.

Shotgun wedding: A case of wife or death.

A hangover is the wrath of grapes.

Does the name Pavlov ring a bell?

Reading while sunbathing makes you well red.

When two egotists meet, it's an I for an I.

A bicycle can't stand on its own because it is two tired.

Definition of a will: A dead give away.

In democracy your vote counts. In feudalism your count votes.

She was engaged to a boyfriend with a wooden leg but broke it off.

A chicken crossing the road is poultry in motion.

If you don't pay your exorcist, you get repossessed.

With her marriage, she got a new name and a dress.

When a clock is hungry, it goes back four seconds.

The man who fell into an upholstery machine is fully recovered.

You feel stuck with your debt if you can't budge it.

Local Area Network in Australia: the LAN down under.

Every calendar's days are numbered.

A lot of money is tainted - It taint yours and it taint mine.

A boiled egg in the morning is hard to beat.

A midget fortune-teller who escapes from prison is a small medium at large.

Those who get too big for their britches will be exposed in the end.

Once you've seen one shopping center, you've seen a mall.

Bakers trade bread recipes on a knead-to-dough basis.

Santa's helpers are subordinate clauses.

Acupuncture is a jab well done.

BOW WAVE is published each week to over 11 000 Readers in the transport,insurance,shipping and finance industries.

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