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Archive for December, 2008|Monthly archive page

Cambodian Kick Boxing Master

In Martial Arts on December 30, 2008 at 3:32 pm

National Treasure

By Antonio Graceffo

 

Eh Phou Thoung and Oed Phuo Thoung are Cambodia’s champion fighters but they live in squalor and obscurity.

 

In the world of professional sports, politicians have long learned that great athletes make great PR. Basketball player Yao Ming is probably the first Chinese national to become a household name. Paradorn brought a lot of positive media attention to Thailand. And, you would have to go into the deepest regions of a remote jungle to find someone who has not heard of Tiger Woods.

 

In return for making the country popular around the world, top athletes are paid huge salaries. Boxing champion, Manny Pacquiao, has become a national legend, almost attaining god like status, and even made a run for the congress. The Philippines is a relatively poor country, and yet, Manny is earning $5,000,000 (USD) for his next fight. Muhammad Ali hasn’t fought in over twenty-five years, but has been a goodwill ambassador of the US as well as the US ambassador to the Islamic world for years. Last year, he appeared on a list of highest paid entertainers, earning an income of $55,000,000.

 

Cambodia suffers from such a lack of marketing that even Angkor Wat failed to be recognized as one of the Seven Wonders of the World. Ask strangers on a street in Europe or America, and most likely the only famous Cambodian they can name is Pol Pot. The only other names which come up frequently in search engines and chat rooms are the two Khmer boxing champions, brothers, Eh Phou Thoung and Oed Phou Thoung. For overseas Khmers, the two brothers are major heroes. Fight fans around the world, would love to see the brothers fighting the leading champions of other countries, particularly Thailand.

 

Unfortunately, the big international fights never happen, as the Cambodian powers that be have more or less forbidden the brothers the right to fight outside of the country. They could have been respected international champions, brining pride to their beleaguered nation, instead, they live in absolute poverty, doomed to a life of obscurity with no end in sight.

 

Is this the right way to treat your national treasure?

 

Behind the ugliest slum building in Phnom Penh, is a neighborhood associated with prostitution, drugs, and gambling. Down a filthy dirt road, where local inhabitants sort trash to make a living, there is a two story wooden house, which serves as Eh Phou Thoung’s gym, as well as home for his family and his stable of twenty fighters.

 

Eh Phou Thoung, a veteran of more than 160 fights, sits listlessly on a wooden bench, with a look of tired boredom on his face. In spite of his ferocity in the ring, he is a kind and boyish fellow, who I have known for years. Every time I look at my old friend, I can’t help but feel that his life is something that happened to him, rather than something he chose.

 

At age 36, he has gained a lot of weight and clearly lost interest in training.

 

“I still fight sometimes, but only a little bit.” He said. He tells me his official record is 156 fights, with 7 losses and 4 draws. “No one in Cambodia can fight with me.” He lamented. Now, when he gets fights, they are mostly with foreigners.

 

“I fought in Thailand once, on the king’s birthday.”

 

Prize money is doubled on the King’s birthday.

 

“I won two and lost one.”

 

Now, eh dedicates most of his time to raising his twenty young boxers. “It is like a big family, and I am the father.” He laughs. Eh buys ice cream from a passing vendor. He eats three while we talk.

 

“Some of my fighters can get as much as $80, but some only get $15. It depends on ability and weight.”

 

To give every club an opportunity to fight, the two networks, CTN and TV 5, each allow one fighter from each club each week. Since the club gets to keep a percentage of the purse, this means that Eh’s club has an income of some percentage of $30 – $100 a week. It also means that each fighter will only fight a few times per year.

 

Cambodian boxing is a far cry from Manny Pacquiao.

 

“Some of the kids don’t even want to be fighters.” Says Eh. “They want to be bodyguards. Sometimes important people come here to scout for bodyguards.”

 

Flies buzz as the neighbors dump endless piles of trash on the muddy ground. They pick through the refuse like jackals on a fallen zebra. I am told that the house with all of the people crowding around and shouting is an illegal gambling parlor. The police stop by approximately every fifteen to twenty minutes and come out, slapping their front short pocket.  

 

Eh gets slowly to his feet to work the heavy bag. He has gained about 15 Kgs since I lost saw him. The tattoos and cup marks from traditional medicine treatments dance across his skin as he kicks. As soon as he breaks a sweat, he sits back down and returns to his catatonic state. His twenty boxers return from running. They train on the cement porch in front of Eh’s house. Other than two heavy bags, their only equipment is a pile of moldy boxing gloves laid out on the roof of an abandoned car.

 

Even overweight and lacking training Eh is a dangerous fighter. In three of his fights against foreigners, he managed to break the opponent’s arm with a kick. Unfortunately, he has only had a few fights in the last several years.

 

“I really want to fight again.” He tells me. “I never get to fight now.”

 

One of the main reasons given why Cambodian fighters can’t fight abroad is because Cambodia refuses to join the World Muay Thai Council. Khmers feel that they invented kick boxing and don’t want to support a sport which has taken a Thai name. To circumvent this issue, promoters have come, asking Khmers to fight in the ISKA, American or Australian Kick Boxing leagues. But even these politically neutral alternatives were rejected by the contract holders. Most people believe that corruption is keeping Cambodian fighters down. If Cambodian fighters start6ed fighting outside of the country, then local promoters and managers would lose the stranglehold they exert over them.

 

Now, in Japan, the K-1, the Super Bowl of kick boxing with prizes in the hundreds of thousands of dollars, is holding tournaments, aimed at South East Asian fighters, with weight limits as low as 70 Kgs. Either Eh or Oed Phou Thoung could qualify, but they both believed they would never be given the chance.

 

“We don’t know how to go there and fight.” Said Eh. “We need sponsors. And no one knows who we are.”

 

When I told Eh Phou Thoung how famous he is on the internet and what a great hero he is to verseas Khmers, he didn’t believe me.

 

The only time I saw Eh Phou Thoung is when he is training his five year old son. The little boy works the bag with his legs, throwing tiny little knee kicks. When he punches the bag, he shakes the pain out of his hands. He is cute, and with Eh for a father, he will be a great fighter. But for what? There is no future for boxers in Cambodia. Which is a sad realization because boxing is the national sport.

 

“I am fighting tomorrow.” He says, out of the blue. It was a charity event, sponsored by Wild Aid, to raise awareness and protect endangered species.

 

“Oed is fighting in Australia.” He was referring to his younger brother Oed Phou Thoung, who is a brilliant fighter in his own right. “He’s coming home tomorrow.”

 

The next day, I stopped by the house to talk to the 26 year old Oed Phou Thoung, the four time champion at 67 Kgs. Oed has had over 200 fights since he was ten years old. When I asked him how he got permission to go fight in Australia, he laughed.

 

“I didn’t tell anyone. I just went.”

 

According to Oed, in Australia a lot of people were waiting for him to fight, but the fight had been cancelled twice, by the power people in Cambodia. As a result, ticket sales were poor for this fight, since people didn’t believe it was going to happen.

 

Although Oed helps train the fighters at Eh Phou Thoung’s gym, his brother is not his manager.  His contract is held by someone else, and he is only permitted to fight on TV 5.  He is also not permitted to fight or leave the country without permission.

 

In Australia Oed Phou Thoung won his bout and earned a purse of $500 Australian after deductions for passport and visa. “But this is good compared to Cambodia.” He assured me. “In Cambodia , when I fight a foreigner I gets $300. If I fight a Khmer, I only get $150.”

 

He said the hardest thing about the Australia fight was fatigue, as he arrived and fought the very next day.

 

“In Cambodia I can only fight about once every three months. So, the money is very little.”

 

“The problem is when the sponsors send money from abroad it doesn’t reach me.” It only reaches the boss. “That’s why we only have two boxing sacks to train twenty fighters.”

 

Oed said that in a perfect world he would get to fight and then rest two or three days before fighting again. I told him that in other countries, fighters only fought once every few months. I asked if he had heard of Muhammad Ali. He said that he had. He was shocked when I told him  that Muhammad Ali had only about 55 fights in his life. Oed had had more than that by his 18th birthday. And his combined earnings for his entire career probably amounted to only a few thousand dollars.

 

To make ends meet, Oed worked as part of the crew at TV 5, helping the doctor with injured fighters.

 

“One boxer, Phin Sophal, committed suicide.” Said Oed, sadly. “He had been very famous, with a lot of fights. He drank and took drugs, then cut his own throat. They took him to the hospital and the doctors saved him. But the wound reopened and he died.”

 

Things are hard for fighters everywhere. And the ring is full of sad stories. But the hopeless situation facing Khmer boxers is unparalleled in any other country.  

 

Oed got up and worked the bag, pow, pow, pow, slap, slap, bang. The whole house shook as his knee left deep dents in its surface. His knees were clearly as well developed as his shins. Every muscle in his body was absolutely taught, perfectly trained.  

 

Unlike his brother, Oed was still training. He had a glimmer of hope in his eye. Maybe his unauthorized trip to fight in Australia set a precedent. Maybe he would take control of his life and make some serious money. Or, maybe at age 26, his prime was past, and he was doing too little too late. Maybe he would manage Eh Phou Thoung’s young son, and help raise him to be a champion on the international circuit.

 

Either way, Cambodian had missed a great PR opportunity and had squandered a national treasure.

 

Antonio Graceffo is an adventure travel and martial arts author, living in Asia. His specialties include ethnic minorities, languages, and martial arts. He has studied Kung Fu at the Shaolin Temple and lived in the last Muay Thai monastery in Thailand. Antonio has published five books, including, “The Monk from Brooklyn,” are all available at amazon.com.

See his videos on youtube.

http://ca.youtube.com/results?search_query=antonio+graceffo&search_type=&aq=f

 

His website is speakingadventure.com

Join him on facebook.com

Contact Antonio: antonio@speakingadventure.com

Lies About Real Estate Investing

In Business and Finance on December 29, 2008 at 4:54 pm

Your home is not an investment.

By Antonio Graceffo

 

The current world financial tsunami started with the collapse of American mortgages. Many people who over-strapped themselves, and bankrupted their families with homes they couldn’t afford believed they were doing the right thing. Their whole lives they were told that a home is a great investment, money in the bank. Now they are learning, a bit too late, that it’s not.

 

Money, as in money in the bank, by definition must be devisable, portable, and universally exchangeable for the purchase of goods or services. Your home is none of these things.

 

If you like a home and wish to live in it, by all means buy it, but don’t kid yourself into believing it is an investment. Investments, by definition, generate income or appreciate. Investments also don’t cost you all of your income to maintain or put you into years and years of debt.

 

The home can be an endless money pit. Your mutual funds may go down in value, but they never ask you to repaint them, furnish or repair them, and you don’t pay annual taxes or interest for the privilege of owning them. Mutual funds, stocks and bonds, all have a ready market available for them which is a mere phone-call away. Any number of external factors may make it impossible for you to sell your home.

 

In bad economic times, when you have lost your job, or in the face of the current world economic tsunami, you can stop paying into your mutual fund account without any negative effects. But if you stop paying your home mortgage, you lose everything.

 

When I was working in New York City, a friend called me from the suburbs to tell me that a heavy wind had blown down the awning on her back porch. The damage would cost $2,000 to repair. Later, when a water leak in an upstairs bathroom caused damage to the drywall, more money went out. While the drywall was being replaced, it was discovered that the wiring was also faulty….Money out, nothing in.

 

On the same morning I checked my investment portfolio online. The storm hadn’t affected it.

 

For most Americans, their home is the largest investment they will ever make. And people are proud to tell you how much they “made” on their home. But actually, the gains are only on paper unless you sell the home, which they don’t usually do, because they want to live in it. So, it is arguable if your home is an investment at all. For financial planning purposes, it is not. Now in the face of this new financial crunch, as home prices plummet, do people who haven’t moved out of their homes say they “lost” on their investment?

 

Buying a home gives people the illusion of an investment.

 

Once, we went out on a financial planning call to a man, call him Mr. Smith, who believed he was financially ready to retire, at age 51. The minute we walked in the door, his wife begged us, “please tell him not to quit his job.” Obviously this was an argument they had been having for sometime, but the mood between them was extremely hostile, particularly since the man had already turned in his two week notice at his job.

 

“I don’t have to work.” Boasted the man. “I am a millionaire.”

 

We looked at his portfolio and it was only valued at $900,000.

 

“Close enough for government work.” He said.

 

At closer examination nearly half of his $900,000 was the estimated value of his home.

 

“So, where are you planning to live after retirement?” asked my partner, Steve.

“Here, of course.” Answered Mr. Smith. “The kids are close by. We love the neighborhood, and we are very attached to the house.”

 

“So, how will you use the value of your house to finance your retirement?” asked Steve.

 

Mr. Smith didn’t have an answer. That meant his total net-worth was about $450,000. Half of that was tied up in his wife’s 401K, which they couldn’t draw on until she reached the age of fifty-nine and a half.

 

Not only would Mr. Smith not listen to our arguments that he was in no position to retire, he actually got angry and threw us out.

 

Denial is a common emotion when people’s financial beliefs are challenged by experts or when undeniable reality steps in and crushes people’s dreams.

 

Another form of denial is the profit people claim to make on their house sale, during good markets. “I bought my house for $150,000 and sold it for $220,000, so I earned $70,000 profit.” This is what a proud Mr. Jones told me at a pool party on Long Island. Apart from the fact that he now needed to buy a comparable home in a comparable neighborhood, which would cost him the same money, he had actually lost on his home purchase. When he bought the home there were loan origination fees, closing fees, and other sundries. During the length of time that he was living in the home he was paying interest. And of course, he bought furniture and did maintenance and renovations on his home.

 

People will go into debt to buy a living room suite or a widescreen TV, kidding themselves into believing that anything they buy for their home is an investment because it increases the resale value of the home. But in reality, resale value is not effected by the presence or absence of a home entertainment center, unless you are planning to include it with the sale of the home.

 

To know what the profit is, one would need to total all of these expenses and subtract them from the sale price.

 

Living in an apartment, I was never tempted to buy anything. With the money any of my homeowner friends paid for furniture for a single room of their home, I paid a years rent.

 

When I was doing investment advisement, one of the most common reasons people gave for not wanting to invest in the stock market was that they preferred real estate. “I want something I can see and touch.” They would tell me. If they were those rare individuals who bought rental properties and collected rents, then they were right. There can be huge advantages to owning real estate. But most people aren’t collecting rent, when they claim to be investing, they just meant they were buying a home to live in.

 

Some of my old-school Italian clients bought a huge house, but they lived in the basement and rented out the upstairs. That qualifies as an investment. The tenant covered the mortgage while the family lived virtually rent free. Then, someday, the family could sell the house, to collect the appreciation, or could just move upstairs, in a fully paid for house.

 

Sadly, these people were absolute minority of homeowners. Most families chose to live in the main house and rent out the basement. This meant they were paying the bulk of their mortgage out of pocket.

 

Another friend of mine, Robert, had the forethought to buy a large townhouse in an undesirable section of a major American city ten years ago, when no one wanted live there. Seven years later, the house had more than doubled in value. He sold it, and cleared more than $200,000 profit.

 

Probably 60% of this number was real profit, over and above what he had spent on renovations, mortgage payments, and other house related expenses. Even with those deductions, his profit was way above what he would have earned if he had invested in the stock market. So, he was one of those rare Americans who actually made real money on a real-estate investment.

 

But, as is always the conundrum with selling the primary residence, Robert still needed a place to live. Having already done the whole, living in the crack neighborhood and waiting for it to change thing, he moved into a better neighborhood, where he bought a much nicer home, worth $1.7 million dollars. He used his entire $200,000 profit as a down payment and began paying $10,000 a month on an interest-only mortgage.

 

His strategy was to wait till this incredibly desirable neighborhood became even better. At that point his house would double in price, as the first one had. He would sell it at a massive profit and maybe start over again, this time, buying a castle.

 

That was the plan. But in 2008, the US economy slipped into a serious recession. The $1.7 million dollar homes aren’t moving as fast as they did a few years ago. Depending upon how the loan agreement is written, there may be a chance that if the home (the collateral) drops in value, the loan could be called. And he would lose everything.

 

In the current market, where Wall Street is dropping like a stone, $200,000 would buy a lot of stock. Or, maybe better, $200,000 would buy a lot of cash, which is probably the safest thing to be invested in right now.

Antonio Graceffo is the former assistant head of Private Wealth Management for one of the largest private banks in the United States. He is now a martial arts and adventure author living in Asia. His book, The Monk from Brooklyn, is available at amazon.com. See his videos on youtube.

http://ca.youtube.com/results?search_query=antonio+graceffo&search_type=&aq=f

 

His website is speakingadventure.com

Join him on facebook.com

Contact Antonio: antonio@speakingadventure.com

 

New Martial Arts Video: The Last Muay Thai Temple

In Martial Arts on December 29, 2008 at 4:44 pm

Prah Kruh Bah, The Golden Horse Monastert Wat Acha Tong

A new martial arts adventure video, by Antonio Graceffo

http://ca.youtube.com/watch?v=QPYj-YoQxXU

 

In 2003, Antonio Graceffo went to Thailand to find a Buddhist monk, named Prah Kruh Ba, a former professional Muay Thai fighter, who lives in a jungle monastery on the Burmese border, where he takes in tribal kids, orphaned by the war in Burma.

 

Antonio cut the Kruh Bah story out of a Taiwanese newspaper, flew to Thailand and walked around the border town of Maesai, showing people the photo, until he eventually wound up in the monastery. Within minutes of arriving, Kruh Bah had Antonio fighting in a ring.

 

During the three months that Antonio lived in the monastery he learned Thai language and Muay Thai (Thai kick boxing). Most importantly, he learned about Kruh Bah’s work along the border, helping tribal people, subjected to genocide by the Burmese government. Among the friends he made in the monastery were members of many of the ethnic minorities: Akha, Lihsu, Lahu, and Shan.

 

The story of the Shan people and their struggle for survival would touch Antonio so deeply that he would eventually go on to work with the Shan State Army inside of Burma. But that is another story.

 

See part one of the Kru Bah story on youtube.

 

http://ca.youtube.com/watch?v=QPYj-YoQxXU

 

Antonio Graceffo is the author of four books, available on amazon.com. He is also the host of the web TV show, “Martial Arts Odyssey.” To see Antonio Graceffo’s Burma and martial arts videos, click here.

http://youtube.com/results?search_query=antonio+graceffo+shan+state+army&search_type=

 

 

See his website www.speakingadventure.com

contact him Antonio@speakingadventure.com

Join him on facebook.com

 

Letter From a Burmese Exile

In War in Burma on December 21, 2008 at 4:59 pm

Former Burmese Freedom Fighter Cries for his Stricken Land

By Antonio Graceffo

 

“I am not that happy at all in (The name of his new country has been deleted for anonymity purposes.) but Freedom I love this, and I want all Burmese people, anyone who is living in Burma, any ethnic, I want them to see and feel freedom like here.”

Kyaw, an exiled Burmese resistance fighter.

 

His wife is dead. His parents and siblings are missing. His country is gone. Kyaw (not his real name) is stranded forever, in the purgatory of a foreign culture, where he struggles to raise his daughters, learn a new language and come to terms with his heart-wrenching past.

 

Driven from their homes, murdered, raped, tortured at the hands of their own government, the ethnic minorities of Burma: Shan, Karen, Karenni, Pa-O, Lahu, Lisu, Rohinga, and others have been suffering for sixty years. In the face of genocide it is easy to forget the suffering of the country’s majority, the ethnic Burmans.

 

In 1988, after the government slaughtered pro-democracy protestors in the streets, a group of ethnic Burman students, including young Kyaw, formed an organization called ABSDF All Burman Student Democratic Front. They took up weapons and fled to the jungle. Many were welcomed into the ethnic armies, particularly the Karen. The government reaction was so violent, that within a few years, the Karen would lose their headquarters. The Shan State Army would be reduced by 90%, and all of the ABSDF fighters would be either killed, captured, or driven over the border into Thailand, where many still live, working illegally. The lucky ones became refugees and were resettled in a third country.

 

Lucky to be alive, they suffer the complete loss of everything they ever knew or called home.

 

Because of the videos I published on youtube about my time in Shan State

http://ca.youtube.com/results?search_query=antonio+graceffo+shan+state+&search_type=&aq=f

 

and the articles I published, I receive a lot of email from Shan and Burmese exiles all over the world. This most recent one was particularly moving. I wanted to share it with the world. Let the world be reminded of how bad things are inside of Burma. And let those of us who work on the conflict, with the various ethnic groups, remember that ethnic Burmans are also victims.

 

Here is the letter from Kyaw, with some editing of his English, for readability, and some author’s notes I interjected, for those unfamiliar with the details of Burma’s civil war, the longest running armed conflict on the planet.

 

Hi, Mr. Antonio,

 

I left my family when I was 14, studying at year Eight in 1988. So, I hadn’t finished school yet. Even if I finished, and if I stayed in Burma, I have no Idea what kind of job I would get. I lived in Shan State capital city, called Taunggyi. It is the third biggest city in Burma, second is Mandaly, and the capital was Rangoon.

 

(Author’s note: The SPDC, Burmese government, moved the capital to a secret, undisclosed mountain location in 2007. Rangoon was changed to Yangon, but it is still considered to be the real capital by all but the junta themselves. The junta also changed the country name from Burma to Myanmar. But no one outside recognizes this change.)

 

After I left home I never saw my brothers or my parents anymore, and still haven’t had contact with them. So, I left it, as this is life, and I am lucky that I am still alive. After I left home I was in ABSDF( All Burmese Students Democratic Front ) for 14 years. In those years, we fought with the Burma army often and a lots of my friends died in the war. We didn’t stay close to the Shan State Army, but we often crossed Shan State armed areas. We lived in the Pa-O area, which is part of Shan state, Karanni state, and Karan state.

 

(Author’s note: The Pa-O are one of the smallest ethnic groups in Burma. They live primarily in Shan State and had their own resistance army, until the major onslaught from the SPDC nearly crushed the resistance. Since then, the armed Pa-O have been absorbed into Shan State Army. The SSA commander, Col. Yawd Serk has a policy of ethnic equality and welcomes all ethnicities who live in Shan State. When I was with the SSA I met soldiers who were Pa-O, Lahu, Karen, and even Chinese speaking soldiers who I had to translate for.)

 

After the Karen (KNLA) fell in 1995-96 our ABSDF organization also collapsed and our base fell in to Burmese government hands, because we are dependent on living with the Karen.

 

(Author’s note: One of the biggest blows to the rebellion was when the Karen lost their headquarters. It was overrun by government forces and the army took years to regroup. The ABSDF were primarily college students from the big cities. They often didn’t know how to survive in the jungle and were very dependent on the help given them by the tribal people.)

 

Karan and Kachin State where the biggest and strongest organizations in Burma. Also Shan was powerful in around 1970 and 1980 but the Burmese military crossed the whole Shan State with powerful regiments, burning and killing whatever they saw. After that, the Shan army was not strong enough anymore.

 

The last, biggest Karan State fell in 1995. Our revolution groups were no more strong enough, but just small groups, still fighting for their homeland, and also ABSDF

 

(Author’s note: The ethnic soldiers were and are still fighting in the very place where they were born, where their parents, their children and their ancestors grew up. There is that feeling of defending the homeland. Among the ethnic soldiers, there is a feeling that the ABSDF were outsiders. Yes, they also opposed the Burmese government, and they were willing to pick up a gun. But there was still a distrust of outsiders.)

 

The small groups continued to fight along the Thai –Burma border, but just small groups.

.

I still support AB and still work for it. I am Burmese and I can speak a little Shan, Karen, and Pa-O language. I can also speak and read Thai well. But now I am trying to learn the English language. It’s very hard for me.

 

I am not that happy at all in (The name of his new country has been deleted for anonymity purposes.) but Freedom I love this, and I want all Burmese people, anyone who is living in Burma, any ethnic, I want them to see and feel freedom like here.

 

I feel sad about Burma.

 

I have two daughters and my wife died after we arrived here with stomach cancer. So, I live with my 2 daughters 11 and 9 years old. However far apart from Burma, I am always looking back and helping when I can.

 

I am so proud of you had helped Burma land. I wish you always remember Burma land. I always know Burma is very beautiful country and Burma has everything more than Thailand.

 

Just because of the government, all Burmese people have been sick, and a sick life is hell.

 

(Author’s note: Please say a prayer for the people of Shan State and for all of the people of Burma.)

Antonio Graceffo is a martial arts and adventure author living in Asia. He spent several months, in and out of Burma, documenting the light of the Shan people. Those stories have been widely published and readily available through a google search. His is the author of five books, including, The Monk from Brooklyn, which are all available at amazon.com.

See his videos on youtube. http://ca.youtube.com/results?search_query=antonio+graceffo&search_type=&aq=f

His website is speakingadventure.com

Join him on facebook.com

Contact Antonio: antonio@speakingadventure.com

 

Leveraging Main street

In Business and Finance on December 21, 2008 at 4:51 pm

By Antonio Graceffo

 

A late night TV commercial, in the 1980s, showed sad people, sitting around their kitchen, with no money to buy a new home entertainment center. Then a friend suggested, “Why not take a home equity loan?” The next scene showed the happy couple, not only enjoying their new home theater, but also fanning themselves with hundred dollar bills. The announcer came on and said, “Don’t just sit there on all that cash. Take a home equity loan and live the life you deserve.”

 

This commercial basically suggested that people put their home ownership at risk in order to finance the purchase of consumer goods that they didn’t absolutely need. It was just one of many easy-credit programs which used to be targeted only at the poor, but have steadily been creeping up and up the American social ladder, infected both the middle and the upper income groups.

 

Back in the early 1990s, when I was essentially homeless and working construction, my coworker, Red, told me about coming home and finding a check for $1,500 dollars in the mailbox. Basically, these checks were sent out by “banks,” shady credit institutions, who lured the poor into debt slavery. The back of the check, the part you had to sign in order to cash it, was actually a loan agreement, locking you into some horrible repayment plan, with high interest, origination fees and late penalties.

 

I think it is no longer legal for companies to send these checks out, unsolicited, to strangers. But, if these guys had already borrowed through this company, then they were considered existing customers, and it was Ok. I once borrowed from a company like this, and noticed that what I thought was a loan agreement was actually a credit account. This meant, even if I managed to pay back the principal plus interest, I could just draw it out again, without going through an application procedure. What was worse, at any time during the repayment process, you could call up, no internet in those days, and check your credit balance. Any cash in the account could be drawn out and the debt started over from zero again.

 

It took me three years to pay off a $3,000 loan.

 

“I was so tempted to cash that baby.” Said Red, a hard drinking, semi-employed brick carrier, with a wife, several children by other women, and a trailer to support.

 

“Why didn’t you?” asked Jason, who was probably thinking of the big meal they would eat at a Mexican chain restaurant, sharing Red’s windfall.

 

“Darleen said she’d leave me if’n I got further into debt. Every Friday when we get paid, I gotta go give most of it over to the Quick ‘N’ Pawn so’s’n I don’t lose the TV.”

 

Pawn was another scam. Red had been $30 short on the rent for the space where he parked his trailer, so he took the only thing of value he had left, his TV, down to the pawn shop. His intent had been to borrow $30 and pay it back, plus the vig, but I think they call it interest in semi-legitimate credit institutions. If he missed a payment, he would lose the TV. The strategy of the pawn shop is to try and push the guy to borrow more. This way, the guy would be more likely to miss a payment a few weeks down the road, and he would lose his TV. The pawn shop then had all of his payments, up to that point, plus they would sell the TV, price which they would make sure was higher than what they had loaned him.

 

The pawn shop had talked Red into borrowing $100. He paid his rent, then used the rest for a big Mexican meal, complete with nachos and beer, and invited Jason and me. The rest he used to buy an answering machine for his wife. The next week, when he couldn’t make his interest payment, he gave the pawn shop his answering machine. Now, he was in danger of losing his TV. And a check for $1,500 had arrived in the mail.

 

Fast forward nearly ten years:was working as financial consultant for a European investment bank. They sent me into consumer banks to invest money for the regular banking customers. At one point, I was responsible for seven bank branches in Manhattan. Depending on which branch I was in, I handled investments for the UN, and used all my various languages in the meetings. I handled investments for politicians, entrepreneurs, mom and pop, you name it. And I saw the whole gamut of personal finance, from top to bottom, which families made good decisions and which made bad ones.

 

One of the branches was in the garment district, and while I was called into handle investment for factory owners, I would see the workers lined up to cash their checks. I always avoided going near that branch on the first and fifteenth of the month, because the factory workers scared me. They would be lined up around the block, hundreds of them, waiting to cash their checks, because they didn’t have bank accounts. Because it was payday, a lot of them had been drinking. Occasionally, violence would erupt. The bank actually had to hire extra security guards for those days.

 

At other times, I was at a branch by Wall Street, where the patrons, mostly traders, had more money and education. But, on Fridays, there was also a line out the door, and around the block, with very well dressed men, holding briefcases, waiting to cash their enormous pay checks. Unlike the factory workers, who would clear less than $200 a week, these checks were sometimes in the tens of thousands of dollars. Ten thousand dollars a week! That was more than a factory worker made all year. This branch also had to have extra security because they would have millions of dollars on hand that day.

 

Why were these well paid men cashing their paychecks rather than depositing them?

 

Because they bought stock several days earlier and had to pay for delivery of the stock on Friday. The stock they bought was speculative. In the late 1990’s it was very possible that in the three to five days it took until you absolutely had to pay for the stock, it would go up enough that you could sell it, without having paid for it, and clear a profit. Or, you could borrow money, pay for the stock, and then sell it. If the stock didn’t go up, then you needed to pay out of your pocket, and sit and wait and sell it next week. Hence, the need for tens of thousands of dollars.

 

But, it gets better than this. These men were also using the financial concept of leverage, whereby they could borrow money, depending on the stock, they could get credit worth several times the value of the stock. Why did they do this? To buy that much more stock, and earn more money.

 

If you buy 100 shares and they go up by a dollar, you made a hundred dollars. You would then sell the stock and pay for it, and pocket the difference. But wouldn’t it be better to buy 1,000 or 10,000 shares? Then, if they go up by one dollar, you made $10,000. If your friend made $10,000 and you only made $1,000 wouldn’t you feel foolish?

 

At that time, there were technology securities which had growth rates of 100% or even 190%. So, if you break that down to how much that was per day, it was a huge growth in the three to five days until you needed to pay for it.

 

It seemed at that time, that everything you bought went up. People were doing anything they could to buy stock and get in on this cash cow that all of their neighbors were doing so well with. In the commercial banks where I worked, I saw the customer come in, and take out a home equity loan, drawing every penny of available equity, and then come over to my desk to buy stock. Once, and I swear this is true, a man came in, filled out all of the necessary paperwork, told me how much and what he wanted to buy. Then, he walked over to the ATM machine and drew out a cash advance on his credit card to pay for his stock trades. As I was in a more conservative end of the business, we weren’t even allowed to accept cash. So, he wrote me a check, said, “wait a minute on that.” He walked over to the teller window and deposited his ATM cash. When he got his deposit slip, he waved and smiled at me, as if to say, “OK, go ahead and process that trade.”

 

He left the bank without even stopping by my desk again.

 

Many of my trader friends told me they used their American Express cards to buy stock. With Amex, you don’t have a credit limit, as such, and if you pay in thirty days, you don’t pay interest. So, they would buy stock, and hold it for thirty days, sell it, and pay off the bill when it came in. But because of settlement rules, it was possible to hold the position for 33 or even 35 days.

 

Picture using a $10,000 cash advance on a charge card to buy $50,000 worth of stock, that you can’t afford to pay for, because you are hoping that it will go up in the next 34 days. I don’t know about you, but that would be a long sleepless 35 days for me. But for these guys, this was their normal routine, month in and month out.

 

I heard stories, although didn’t actually see it with my own eyes, of guys taking cash advances of tens of thousands of dollars, buying hundreds of thousands of dollars worth of stock they couldn’t afford, and holding it for thirty days.

 

In addition to being insane about trading stock and “leveraging” their position, one commonality between all of these educated, well-off men was that they sneered at the “jerks” who fell for the home-equity credit scams on TV.

 

“Can you imagine someone being that stupid and using their home equity to buy a stereo?” They would say.

 

The late 90’s and into about 2000, Wall Street was experiencing what financial experts call a bubble. It is a time when the market goes up and up. Prices and returns inflate until, eventually, like a bubble, they burst. And then you are left with a soggy, deflated balloon, and no house.

 

When Charles Edward Merrill, founder of Merrill Lynch, coined the phrase, “Bringing Wall Street to Main Street,” he didn’t mean that normal people should be leveraging their kid’s college fund, their retirement monies, or their home. He was trying to level out the playing field, and give the regular Joe a chance to participate in the stock market. But somehow, the concept became perverted and blown out of proportion on a scale that would probably have sent Merrill spinning.

 

Everyone was focused on “let your money work for your you.” But, comedian Jerry Seinfeld pointed out, “What if my money gets fired?”

 

In addition to leveraging assets and salaries, people in New York, and elsewhere, decided that they, like big corporations, should hire accountants, who knew how to “work the system.”

 

“Why should the government be making money on your taxes?” was a common phrase that was thrown about, as people sat in Starbucks, drinking a $4 late and swapping tax avoidance strategies.

 

A friend of mine, a Wall Street trader, earned $800,000 in one year. His accountant used aggressive, but legal strategies to postpone ALL of his tax payment until the following year. And why did my friend want to do this? So that he could use his tax money to buy stock.

 

His plan was brilliant. Use the $250,000 in his tax account to buy stock, fully leveraged, of course. And when the stock went up, he would sell it, and use the profits to pay last years taxes and this years taxes. Or, maybe he would look for another loophole to push the tax debt further one more year.

 

Since a technology mutual fund could gain 190% per year, my friend, and others like him, saw their debts as decreasing in value at a rate of 190% per year.

 

Unfortunately, for my friend and others like him, a basic rule of both physics and finance is, what goes up, must come down. The bubble burst.

 

If you use leverage in a stock account, the stock is essentially the collateral securing the loan. This method works great in an upward market. But now, let’s say that your stock drops in value by 10%. You no longer have enough collateral to secure the loan. The loan comes due in the form of a margin call. This basically means, you have to repay the loan, or put enough money into the account to make up the shortcoming in your collateral.

 

But money, cash, was the one thing none of these guys had. Cash was stupid. Cash was for losers. Cash prevented you from “leveraging,” from maximizing your returns.”

 

So, how did they make up the deficit in the face of a margin call? They sold stock. But they were now selling it for less than what they had paid for it. So, they had to sell more than what they lost. For some of these guys, the credit card bills, home-equity loans, or whatever crazy credit bills also came due, and now they were in serious trouble.

 

My friend, the trader, who postponed his $250,000 income tax payment, lost everything. On Wall Street, if you wind up in trouble with the IRS or have any personal credit issues, bankruptcy or foreclosure, you generally lose your license and your job.

 

The tax debt which my friend believed was decreasing at a rate of 190% wasn’t. Those gains in his portfolio were “paper gains,” not real. But his tax debt was real. Suddenly, he had no money, no job, and a $250,000 tax bill staring him in the face.

 

Like a recovering alcoholic who could never go near a bar again, my friend needed to find the simplest, most secure, quietest job he could. He started working at the post office. His new salary was $40,000 a year. And he will be paying off his tax debt for the rest of his life.

 

This would be a good place to end this article. We saw how crazy the bubble was and how stupidly people used credit in America. But sadly, it doesn’t end here.

 

When technology stock blew up, people went to small cap. When the stock market more or less imploded, people ran to real-estate.

 

“I can’t believe how stupid we all were with stocks before.” A friend of mine told me. “But I learned my lesson. Real estate is the way to go. It’s safe. You can see. You can touch it. And it always goes up in value.”

 

This particular friend used his house as collateral to invest in as many condominiums as he could. When last I checked with him, they were still unrented. And in the face of the current trend of foreclosures and lack of consumer credit, I don’t see how he could sell them.

 

If I had a chance to pull him aside at a cocktail party I would tell him, “I got a hot tip for you, the new, new thing.” Then I would look over both shoulders to make sure no one is listening and tell him the financial secret handed down to me by the film, “the Graduate.”

 

“Plastics” I would say. “Technology didn’t work out. The market tanked. Real-estate went bust. But if you want a fool-proof investment, buy plastics.”

 

 

Antonio Graceffo is the former assistant head of Private Wealth Management for one of the largest private banks in the United States. He is now a martial arts and adventure author living in Asia. His book, The Monk from Brooklyn, is available at amazon.com. See his vieos on youtub.

http://ca.youtube.com/results?search_query=antonio+graceffo&search_type=&aq=f

 

His website is speakingadventure.com

Join him on facebook.com

Contact Antonio: antonio@speakingadventure.com

 

 

 

 

Article: Bernie Madoff the New King of Ponzi

In Business and Finance on December 16, 2008 at 3:50 pm

Bernie Madoff the New King of Ponzi

By Antonio Graceffo

 

On December 11, 2008, Bernard Lawrence Madoff (born April 29, 1938) chairman of Bernard L. Madoff Investment Securities LLC was arrested by the FBI. At that moment, he moved from being a hedge fund principal with suspiciously consistent returns, to being a suspect, thought to have bilked investors out of $50 billion. So far, according to the FBI and other sources, this is the largest investment fraud ever committed by a single individual.

 

People all over the world read the headlines, and knew this guy must have done something bad, but a lot of people don’t know exactly what a hedge fund is, or what Madoff did wrong.

 

A hedge fund is a private investment company which accepts money from a limited number of investors. The reason it is called a hedge fund is that the strategic intent is to hedge or counter balance the market. In other words, hedge fund managers are hoping to use a strategy which causes their fund to go up when the market goes down. To do this, hedge funds often use investment instruments which are considered higher risk than what you might find in your 401K. These could include puts, calls, option, and exotic options, and derivatives to name a few.   

 

Hedge funds are regulated outside of the scope of “normal” investment companies, such as mutual funds. Their shares are also not readily available to the public. Compared to the scrutiny a mutual fund is subjected to and the disclosure requirements they must meet before selling shares to the public, hedge funds are like the Wild West of the investment world.

 

Because of the perceived risk involved and the lack of regulation and investor protection, investment in hedge funds is generally only open to “accredited” investors. There are strict rules as to how much the minimum investment must be. Generally the minimums are quite high, often in the millions. Rules also stipulate that the millions you invest in a hedge fund should be no more than a certain percentage of your total net worth or total investable assets. Hedge funds are generally not allowed to advertise and are often limited in the number of investors they are allowed to accept.

 

The basic idea is that people investing in hedge funds are extremely wealthy. They have experience with investing, and their hedge fund investment is just a piece of their overall investment strategy. These people usually have advisors, such as brokers, planners, accountants and attorneys who should be looking out for their interests. The investors in a particular fund often know each other and know and trust the fund manager. The fund doesn’t advertise, so it acquires new investors simply through word of mouth. Someone invests, makes money, and tells two friends. They tell two friends, and so on.

 

Hedge funds are in no way illegal or immoral. They serve a purpose which exists outside the scope of the average person’s radar. The investors in hedge funds are often institutional investors, such as endowment funds and retirement and pension plans.

 

So, what did Madoff do wrong?

 

It was publicly known that Madoff paid brokers “for order flow.” This means giving a commission directly to a broker for buying shares. The rules on how brokers are compensated; who can pay them, and how much, are very strict. You never want to create a situation where a broker might be tempted to sell an inferior or inappropriate investment to a client, simply because he was to receive a bigger or additional commission.

 

While hedge funds are subjected to less stringent regulation than mutual funds, they are not completely outside of the law. These funds are required to file certain disclosure documents, showing what they were invested in. But, just before the end of each quarter, when these documents should have been prepared, Madoff’s fund sold out their investment positions. So, no one actually knew where the money was invested.

 

Another reason outside entities were keeping Madoff in their sites was because of his returns. Over a period of years, Madoff’s investors received a steady 10.5% return on their investment. This number is not so shocking, if we consider that small cap stocks, over a long enough time line, are expected to yield a similar return. What is strange however, is that Madoff’s returns were consistently between 12% and 13%. Normally, we would expect an investment to fluctuate much more widely over a ten year period.

 

Just to put this in perspective. I checked the ten year average of a technology mutual fund that I sold while I was an investment advisor, working in New York City. From 1998 – 2001 the fund experienced a growth of nearly 300%. If you had invested $10,000 in 1998, your investment would have been worth over $35,000 in 2001. Today it would be worth about $7,500. Checking a small cap mutual fund, which we would expect to be somewhat less volatile than technology, your $10,000 investment in 1998 would have hit a high of about $35,000 in 2007 and would currently be worth about $17,000. 

 

This type of fluctuation is in sharp contrast to Madoff’s two-point swing.

 

The big crime that Madoff committed was Ponzi.

 

Ponzi is a name given to an investment scam, first popularized in the USA, in 1903, by Charles Ponzi. The idea is, you get a bunch of investors, and promise them high returns. They all give you an initial investment, let’s say 100,000 each to make the math easy. At the end of the first quarter, you pay them all their quarterly earnings. You send each investor a check for $5,000.

 

WOW!, Thinks the investor. I earned $5,000 in one month. That means 5% per month, or 60% per year. This is great. The bank is only paying 2.7% per year. And so, the investor invests more. And he tells his friends to do the same. As long as you keep sending checks to the investors, they will keep investing, or at the very least, not want to take their money out. As long as new investors join, you will have money to continue making payments to the old investors. They think they are earning interest, dividends, or investment returns. But in actuality, all they are getting is their own money back.

 

For Madoff, the final nail in the coffin came when investors demanded $7 billion of their cash back, and he didn’t have enough left to pay them. Now, he faces up to 20 years in jail. But he will always be remembered as the New King of Ponzi.

 

 

Antonio Graceffo is the former assistant head of Private Wealth Management for one of the largest private banks in the United States. He is now a martial arts and adventure author living in Asia. His book, The Monk from Brooklyn, is available at amazon.com. See his vieos on youtub.

http://ca.youtube.com/results?search_query=antonio+graceffo&search_type=&aq=f

 

His website is speakingadventure.com

Join him on facebook.com

Contact Antonio: antonio@speakingadventure.com

 

 

Tomorrow’s Spending Today

In Business and Finance on December 11, 2008 at 12:53 am

More on the Global Financial Crisis

By Antonio Graceffo

 

Even if you haven’t been to business school, at is base, business is pretty simple.

 

Step 1: Buy a widget for a dollar and sell it for a dollar ten.

 

Now it starts getting technical.

 

Step 2: If you sell more widgets, you make more money.

 

As a business owner, selling more products is better than selling less. Wow, so far this is making my head spin.

 

So, how can you get people to buy more widgets?

 

Step 3: The obvious way to get people to buy more widgets is to lower the price of your widget. You can do this by employing Mexican or Uzbek children in your factories, or by instigating a war and capturing the necessary raw materials.

 

But at some point, the widget is as cheap as it is going to get. Walmart came up with an interesting business strategy. Every other company in the world was trying to increase profit margins (the difference between your cost and the price you sell at). Walmart, on the other hand, was trying to decrease this number. The idea was to strip the costs down to nothing, then keep reducing the profit percentage, but increase the number of widgets sold.

 

Selling a million widgets, with a 2% profit makes you more money than selling 100,000 widgets with a 3% profit.

 

This method worked for a while, and the US consumer market just kept growing and growing.

 

 

Super stores, warehouse marts, and large box stores were popping up everywhere. When I was living in Europe I tried to buy a five pound box of my favorite breakfast cereal, “Chocolate Super Bombs.” The clerk looked at me and said, “But you are only one person. Why do you need five pounds of cereal?”

 

Americans owned significantly more products than people in other developed countries. When my sister told her European boyfriend she was going shoe shopping, he answered, “But you already have shoes.”

 

When I was teaching English in overseas, students often asked me, “Teacher, on TV we see many American movies, and there are always monsters in the basement. What is a basement?”

 

“It is a place to store things you purchased but never use.” I answered.

 

The follow up question would inevitably be. “In some movies, the monster is in the attic. What is an attic?”

 

“An attic is also a place to store things we bought but don’t use. But an attic is above the house, instead of under it.”

 

Did buying a lot of products increase the frequency of monsters?

 

“Teacher, in American movies, when people want to commit suicide they drive their car in the garage and turn on the car engine. What is a garage?”

 

“It is a place where you store one of your automobiles.”

 

“But some garages look so messy, and some people still park on the street.”

 

“That is because Americans also store unused products in their garage.”

 

Some American homes had three or more rooms designated as depositories for products that they had purchased but didn’t use.

 

Step 4: If low profit margins and low cost weren’t enough to move products off of the shelves, sellers could use sales and coupons to entice buyers. In some cases, products were sold at a loss. These products were called “lost leaders.” The thinking is, you come in the shop to buy a lost leaser and hopefully make ten other compulsion purchases while you are there.

 

When I was a student in Germany, I discovered that Germany had very strict rules against sales. And lost leaders were actually illegal. You couldn’t sell a product below cost. The German rational was that by selling low cost products, large stores had an advantage over small stores and this was in detrimental to a free market.

 

My American classmate, John-the-Republican would get angry. “Having the government tell you what price to charge for your products is detrimental to a free market.” He would complain. One day, he came back from a shopping excursion to Stuttgart, where he had just bought a new album. “Do you know why this CD was $30? Because I am paying for some old guy’s retirement.”

 

At that time, Germans were taking early retirement in their mid fifties. The unions were pushing for a four day work week. Women (or men) could collect three years of maternity leave benefits from the government. An advocacy group in support of unemployed people was complaining that with recent government benefit cuts, “many unemployed people earn less than those who are working.”

 

Germany had one of the lowest unemployment rates in western Europe and yet it was more than double US unemployment.

 

In the face of so much money going out and so little coming in, the government still put money and resources into campaigns, telling people not to consume.

 

We American students all said that selling more products was better for the economy. It created jobs and created financial movement. We suggested lifting bans on sales and lost leaders.

 

The German’s rebuttal was telling of the differences between the two countries/cultures. My Germans classmate said, “Each week, people will buy the products they need. If you decrease the price, people will still buy the same number of products, because they don’t need more products. And you will earn less money.”

 

“But when they are in the store, won’t they suddenly see other products that they needed or wanted?” We asked. “For example, in America we have end displays at the ends of the aisles, which feature a different product each week. Or we have compulsion purchase products near the registers.”

 

“That should be illegal.” Retorted our colleague. “You are making people buy things they don’t need.”

 

Then I pointed out that making people buy things they don’t need isn’t as bad as packing them in trains and shipping them off to concentration camps. And the conversation pretty much deteriorated from there.

 

One interesting point that the Germans made was that, if you decreased the price of product, lets say cans of tuna, German consumers would still buy exactly the same amount. If they normally bought two cans a week, and you decreased the price, they might buy eight cans. But they wouldn’t consume eight cans. They would just be buying a month’s supply in one day. So, while your sales would spike during the week of the sale, they would slump, and average back out for the rest of the month. But your profits would be lower.

 

In sales, we call this shifting tomorrow’s spending to today. In America too, sales we walk a thin line in developing sales strategies. The question comes up, “how can I get people to buy more today, but still buy again next week?”

 

This is why American producers keep developing new types and brands of products. In the former East Germany, if you were lucky, and if you had connections, and if you had foreign exchange coupons, you could go in a shop and purchase a brown box, marked with a black stamp, which read, “COOKIES.”

 

In the new Germany, you go in the supermarket and there is about half an aisle dedicated to cookies, candies, chocolates, breakfast cereal and a number of other products. Most grocery stores in Germany only carry about six or eight flavors breakfast cereal and they are all the same size.

 

There are also very strict rules in Germany about how these products are marketed. In general, advertising which targets children is discouraged, if not illegal.

 

Big grocery stores in the US have an entire aisle dedicated to breakfast cereal. There are thousands of brands, most of which are tied to cartoon commercials and memorable characters or movies. Tony the Tiger, Dig’em the frog, the Roce Crispy Guys, Count Chocula, Boo Berry, Frankenberry, Fruit brute, Lucky the Leprechaun, and my all time favorite, Captain Crunch.

 

Inside of each brand are numerous varieties. Captain Crunch comes in regular (which cuts the inside of your mouth, peanut butter, Captain Crunch with Crunch Berries, and new, Choco Donut Captain Crunch. And each flavor comes in a variety of sizes.

 

If one brand, flavor or size in on sale today, you buy more. But next week, you also but, because you want a flavor or brand. The same is true for consumer goods, such as TVs, DVD machines, computers, clothing, cars, and even houses… By creating so many new choices and types, the manufacturers guarantee that a decrease in prices this week causes a spike in sales this week, but by releasing a new product next week, they can also expect a spike in sales next week.

 

The spike became the norm.

 

This strategy has gone on and one for years. At some point, even the US consumer ran out of money. You can only take advantage of sales if you have cash.

 

Step 5: Extend liberal lines of credit to your customers.

 

From the 1950s to the 1970s you to had show income, savings, and credit history to obtain credit cards. Buy the 1980s college students and unemployed people could obtain cards simply by filling out the application form. By the 1990s, unwanted credit cards actually arrived in the mail. You had to simply call to activate them.

 

Now, you had spikes in sales, driven by the invention of new models and brands. You kept your profit margin low, so your end product was low, but your overall product was high because your sales were high.

 

The US had the lowest inflation, lowest unemployment, and one of the highest qualities of life of developed countries. This last claim is more of an opinion, but we definitely owned more stuff than anyone else.

 

The Germans argued that our low unemployment rate was artificial because it included low paid workers who were below the poverty line. In Germany, less people had jobs, but everyone who had a job could afford to eat and live. They also argued that our sales figures were artificial because they were built on an ever growing consumer debt, which would eventually have to be repaid.

 

I personally know a couple whose credit card debt had reached one year’s salary. That will never be paid off.

 

Companies who cut their profit margins to almost nothing also used debt to expand and sell more products. They were functioning on such a narrow shoestring, that as soon as the hint of this financial tsunami hit and consumer spending dropped by a small percentage, the shops collapsed into bankruptcy.

 

Many economists predicted that the system couldn’t go on forever, and that the whole economy would eventually blow up.

 

I guess they got it right. And now, we will be paying for yesterday’s spending tomorrow.

 

Antonio Graceffo is a martial arts and adventure author living in Asia. His book, The Monk from Brooklyn, is available at amazon.com. See his vieos on youtub.

http://ca.youtube.com/results?search_query=antonio+graceffo&search_type=&aq=f

 

His website is speakingadventure.com

Join him on facebook.com

Contact Antonio: antonio@speakingadventure.com

 

 

 

 

 

 

 

 

 

Insane Polyglots

In Linguistics and Language Learning on December 7, 2008 at 3:55 pm

Their brains are just different.

By Antonio Graceffo

 

 

When the aliens mother ship finally arrives, Pramjeet Singh will be the only one who can talk to them. He’ll make lots of money and they will put him in charge. The rest of us will be sent out to labour in the fields, and if we complain, Pamjeet Singh and his UFO buddies will say, “Shut up and eat your pudding.” But we won’t understand, because our brains just don’t work that way.

 

 

 

Learning a new language rewires your brain. Could learning a new language make you crazy? I have known some linguists who were completely off their nut. Others seem to exist on some intellectual plane that the rest of us could never achieve and can’t quite understand.

 

The crazy people are always the most fun, so let’s start with them.

 

When I was studying in Germany, we had a student from Estonia, call him Valdma. At the school, we chose a three language combination, including our mother tongue, as long as all three languages were used in the EU. Because Valdma’s home country, at that time, was not yet a member of the EU, he couldn’t used Estonian as his mother tongue. So, instead, he chose another language, I don’t remember if it was Russian or German. He passed the mother tongue exam and began his studies. I don’t remember what Valdma’s official language combination was, but he spoke and wrote eleven languages fluently.

 

Like many Eastern European intellectuals at that time, he had already earned a PHD in his home country, but his degree was not recognized, so he came to Germany and started over again as a freshman, in an undergraduate program. I guess that would be enough to make most people crazy.

 

Most of the time, Valdma would sit in his room studying. He also prowled the large medieval library, which occupied the upper floor of the castle, where our university was located.  It was a scene right out of “Name of the Rose.” You were in a particularly remote and dark corner of the library, your back to the massive cold stone walls, frantically looking up a list of vocabulary, such as chemicals used in frozen foods, in three languages, and suddenly, there was Valdma staring at you.

 

To say he snuck up on people would have been unfair, since his stench generally preceded his presence by minutes, if not hours. During the two years that our studies overlapped, he was never known to have taken a shower or change clothes.

 

Once, to break the tension of having this Slavic madman staring at me, I almost managed a weak, “hello.” But like a deer that had been frightened by the shutter of your camera, he disappeared, running back into the dictionary section.

 

I think some students didn’t even believe that he existed. Sadly, the only proof we had was some grainy black-and-white photographs of him dancing with the Yeti.

 

Rumours said that Valdma would use his student card to get into the library, then steal massive, priceless translation dictionaries, hiding them under his many layers of unwashed clothing. Since no one was willing to strip search him, he could easily spirit these volumes back to his room. He would then lock himself in his room until he had memorised the entire dictionary. Afterwards, he would make another public appearance, return the book, steal a new one, and so on. In this way, it was rumoured he had memorised an entire shelf of dictionaries.

 

As enticing as Valdma’s life may sound, it wasn’t all fun and games. He was apparently in love with a  German student, named Nena, who he began stalking. He managed to get inside of her room, while she was at classes, and leave her an original French poem he had written. He had placed the poem, a long with a single flower, on her bed, hoping to win her over. Instead, he creped her out, and she called in the authorities. Germany often takes to light an approach towards insane people who pose a threat to others. I guess they were trying to overcompensate for Hitler’s “final solution.” So, they allowed Valdma to stay at the university.

 

Valdma thought the reason Nena had been angry was because she preferred poems written in Spanish. He spent the next several weeks learning Spanish to absolute fluency, and left her a new poem.

 

At this point, Valdma must have started a new, particularly difficult language, because he disappeared for a while. We all knew he was in his room memorizing dictionaries, but beyond that, there was no word of him. Months passed and I had been hired at a local language school as a teacher. One morning when I came in early for an eight o’clock class I passed Valdma on the stairs. The school secretary was a village woman who loved to gossip.

 

I once asked her about one of the other teachers, who was also a student with me at the university. She smiled, “Oh yes, the Herr Prost is a very intelligent man.” Then she looked around, to make sure no one was listening, and she whispered. “He drinks. And his wife goes with other men.”

 

When I asked her about Valdma, she was so happy to be able to really gossip. She poured us both a cup of coffee and spilled the beans.

 

“Herr Valdma was hired here because he can teach any language a German businessman would need to learn.” Not to mention the fact that he probably worked for half of what I was charging. “But, we will have to fire him. Students are complaining about his smell.” She made a face as if she had just bit into a toilet sandwich. Then she lead me to the bathroom and showed me where the normally spotless sink was completed coated in crud.

 

“We suspected that he sometimes sleeps spends the night in the classroom. He apparently bathes in the sink, and now we will have to call someone to unclog it.”

 

Most people were horribly repelled by Valdma, but writing this story, nearly twenty years later, I regret that I didn’t go out of my way to speak to him. He would have been an interesting guy to get to know, if you could get past the smell.

 

 

On some level, on many levels, I have always respected and envied him. I wish I could be half as intelligent or half of his discipline. And, I have always wondered, was he already insane, or did the study of too many languages make him that way?

 

Among the students I studied with at Germersheim there were a number of people who were just borderline insane, or normal crazy.

 

Once a notice appeared on our student bulletin-board. “I will be beginning studies at Germersheim in October. I am looking for conversation partners for: German, English, French, Italian, Swedish, Chinese…” These are only the languages I remember, but the list was much longer. He also included a chart of how well he spoke each language. He rated himself advanced or fluent in many of them. The ending of the note was as interesting as the beginning: “I can’t pay you money, but my family owns a beautiful villa on the Sicilian coast. If you are willing to work as my tutor, you could come live in the villa for the summer. My family will give you food and lodging.” Signed, Luigi.

 

When Luigi arrived, he was, believe it or not, a weirdo. He looked like a garden gnome, but one whose father happened to be Don somebody of the something-or-other family, and he could have you killed if he had wanted to. Fortunately, all he wanted to do was learn languages. So, he had spent his whole life studying languages in different countries all over the world.

 

For some people, there seemed to be a fine line between genius and insanity. But for others, it was simply an advantage.

 

An American professor at our university, Dr. Don, gave me a very difficult translation to do, for a lot of money. He also gave me the phone number of someone who could help me.

 

“If you get stuck, call my friend Pamjeet Singh.” Professor Don told me. “He is the greatest translator who ever lived, and also my best friend. If he doesn’t have an answer, he will know how to find one.”

 

So much of what Don taught us was that being a good translator was not predicated on being good at speaking a language well, but on knowing how to do research, and finding the answers. Pamjeet Singh was a master of this.

 

Although Pamjeet Singh was known as one of the best German-to-English translators in the world, he was not an English native speaker. His native tongue was Urdu but he also spoke Hindi and a number of other Indian languages. After earning a Masters degree in Physics, in India, he decided to learn German, and come to Germany to continue his education. He moved to Berlin and earned a masters degree in German. Then, he entered a PHD program and was writing a book on an area of artificial computer intelligence, which was related to psycholinguistics. It was the only book ever written on the subject, and Pamjeet Singh was, of course, the world’s foremost authority in this area.

 

During his PHD studies, Pamjeet Singh moved to Germersheim to complete a masters in translation, while he continued his study of psycholinguistics and artificial intelligence. Constantly working as a lecturer and translator, Pamjeet Singh was also writing and publishing. He was slowly becoming wealthy, and yet lived in the basement of an old widow woman, who put any umber of restrictions on him, as conditions that he be allowed to live there. 

 

“Why doesn’t Pamjeet Singh move out?” I asked Don.

 

“He would never do that.” Don explained. “The widow who he rents the apartment from was the wife of a very famous translator. Her husband worked in the field for about sixty-years, publishing a number of books on the subject. He also wrote a number of dictionaries. In addition to this, he amassed a tremendous library of very rare translation books and specialized dictionaries. The governments of many countries have to come to the widow, offering to buy the books from her. But she won’t sell them. They have deep emotional value for her, because they are the legacy of her dead husband. In fact, the way Pramjeet Singh met her is that he went to her house, to try and convince her to sell him a few of her husbands books.

 

When she refused outright, Pramjeet Singh proposed that he move into her house, pay her an exorbitant rent, but then he would have access to her husband’s library. She agreed. And Pramjeet Singh has been there ever since. Among the translation community, there is a rumour that the widow put Pramjeet Singh in her will, and that he will inherit the books when she dies.”

 

“Is it true?”

 

“I asked Pramjeet Singh that same question.” Said Don. “He said. Don, I hate that old bat. If I found out for sure she had put me in the will, I would push her down the stairs, the same day.”

 

Pramjeet Singh truly believed that language acquisition was the same, no matter what the language. Since we are all capable of learning one language, our native tongue, we must be capable of learning any language. Sometimes, when I see little Taiwanese children speaking Chinese so fluently, I think. “They must be really smart.” I struggle through Chinese, but here, even small children speak it fluently.

 

 

Dr. Don invited me to work as a research assistant on a project he and Pramjeet Singh were publishing on language acquisition theory. The project was designed to study first language acquisition by children, to see if this would unlock the key to learning other languages. After they completed their research, and developed a written theory of language acquisition, they wanted to put it to the test. They gathered several volunteers from among the student body. At first, they thought of applying the theory to learning one of the languages offered at our school. The choices included the twelve (at that time) EU languages, plus Chinese, Arabic, Russian, and Polish. The problem was that even if they could screen the volunteers, and eliminate people who already spoke one of these languages, there was no way they would be able to find test subjects who had never had any exposure, of any kind, to these languages.

 

The EU languages, of course, were very common. Russian and Polish were widely spoken in our village. And, even in the case of Chinese, we had all been to a Chinese restaurant, or watched a kung fu movie. Instead, they wanted a language that would be completely foreign to everyone. Eventually, they settled on Latvian. They brought a teacher over from Latvia, and they began studying the language, using their new techniques.

 

The results of their research supported their theory, basically that learning language, any language is all the same . Latvian children find it no harder to learn Latvian than do Mexican children learning Spanish, or Brooklyn children learning English. (Yes, I know, some Brooklyn children don’t exactly speak English. So this was a bad example. But you know what I mean.)

 

Pramjeet Singh’s theory went even further. He believed, somehow, that you didn’t need to learn a language to be able to understand it, speak it, or write it, because all forms of human communication where the same. When we worked together on this translation, we needed very specialized dictionaries, which dealt with chemical properties and processes. Often we couldn’t find a dictionary that dealt with these subjects, specifically. So, Pramjeet Singh would draw on his tremendous knowledge, and go to other sources for parallel information. One example was that our translation dealt with preparing long-life, processed foods, which were packaged, and shipped all over the world. There was a detailed explanation of the chemical-freezing process, which we had to translate. No known dictionary dealt with this process, for food.

 

“I believe that the chemical freezing process for steel production is similar to this one for food.” Said Pramjeet Singh.

 

So, we called around, and got the leading dictionary for metallurgy. And, sure enough, we found many of the answers we were looking for. Next, we needed information about how tar was processed, and used as a preservative for food. Pramjeet Singh suggested that tar processing was similar to rubber processing. So, we checked with rubber manufacturers. But, the only dictionaries we could find were produced in Italy and they translated German into Italian and French.

 

When Pramjeet Singh showed me the dictionaries, he was so happy. “Now we have all of the answers.” He said.

 

“How do you figure that?” I asked. “These dictionaries don’t have English.”

 

“They don’t have to.” He said.

 

“Do you speak French and Italian?” I asked.

 

“No.” Said Pramjeet Singh.

 

“So, how will you use these dictionaries?”

 

Pramjeet Singh looked at me like I was crazy. “The answers are right here.” He said, pointing at some foreign words that I couldn’t read.

 

“Don’t you see it?” He asked.

 

The answer was. No, I didn’t see it. When I told Don about this incident later, he said. “Pramjeet Singh exists on such a higher intellectual plane, he doesn’t understand that there are people who neither see, nor understand what he does. To him all languages are the same.”

 

Don went on to tell me about how Pramjeet Singh had made a lot of money doing translations for financial institutions in Switzerland, who couldn’t find specialized translators for their subject matter. “Pramjeet Singh doesn’t speak French, Italian, or Romanche, or any of the Swiss languages, except German. And yet he was able to do these translations that no one else could.”

 

I though about Pramjeet Singh a lot as I practiced writing “My pencil is yellow.” And, “Do you like my new car?” in Chinese. The point of this whole story is, I’m no Pramjeet Singh. And I don’t exist on that plane. But Don, Frank, Pramjeet Singh, Uta, or any of my old classmates would agree. Learning another language is just another thing. Since I leaving Germersheim, my classmate Uta has become 100% fluent in Danish. And, Frank became fluent in French without even setting foot in a classroom.

 

When the alien mother ship finally arrives, Pramjeet Singh will be the only one who can talk to them. He’ll make lots of money and they will put him in charge. Maybe Valdma already is one. The rest of us will be sent out to labour in the fields, and if we complain, Pamjeet Singh and his UFO buddies will say, “Shut up and eat your pudding.” But we won’t understand, because our brains just don’t work that way.

 

 

Antonio Graceffo is a martial arts and adventure author living in Asia. His book, The Monk from Brooklyn, is available at amazon.com. See his vieos on youtub.

http://ca.youtube.com/results?search_query=antonio+graceffo&search_type=&aq=f

 

His website is speakingadventure.com

Join him on facebook.com

Contact Antonio: antonio@speakingadventure.com

 

 

 

Philippine Knife Fighting In the War in Burma

In Martial Arts on December 1, 2008 at 5:19 pm

Teaching Practical Philippine Martial Arts to the Shan State Rebels

By Antonio Graceffo

 

Using the butt of the knife for grabbing and grappling is one of my favorite knife fighting techniques. Unfortunately, the knives used by the rebels in Burma were about twice as long as the Philippine bolo. So, when I was grabbing my opponent with one end of the knife, I had to be careful not to poke out my eye with the other end.

 

Ethnic cleansing has been going on in Burma for more than fifty years. The recent cyclone has shown the world how disinterested the Burmese government is in the well-being of its own citizens. Many people also don’t know that Burma is composed of countless ethnic groups, most of whom the junta lead government is trying to kill.

 

In Shan State, the Burmese army troops frequently burn villages to the ground. They use gang rape on very young girls as a means of intimidation. They force Shan villagers to works as slaves, porters, carrying ammunition through the jungle until they die of over-work and starvation. Shan civilians are used as human mine detectors and combat shields. The Burmese soldiers hide behind the civilians during firefights.

 

The war in Burma has created more than two and a half million refuges. Some people refused to leave, however. After their village was burned and their families raped, tortured or murdered, many men join the resistance, the Shan State Army.

 

The Shan State Army (SSA) is one of the rebel groups fighting against the Burmese junta. A friend of mine, from the Swedish army, had been working with them for years. He arranged for the rebels to smuggle me across the border and have a meeting with their commander, Colonel Yawd Serk. I was asked to be his guest at a huge banquet, where he asked me to teach hand-to-hand fighting to his soldiers. 

 

For the next several months, on and off, I would sleep in the cinderblock house, belonging to the Lieutenant. Although enemy camps were so close that we could see them on the next hilltops, it is amazing how well you sleep when you are surrounded by landmines and armed soldiers.

 

I don’t like to train early in the morning. I have always been a firm believer that any training you do at 6:00 AM could be done much better at 10:30. The next morning, during a leisurely breakfast, I slowly formulated a plan as to what I would teach the men. For years, I had been developing a system of practical fighting for police and military in Taiwan and other countries. The empty hand fighting was largely based on Khmer Bokator and Muay Thai Boran, but also included grappling techniques from Kuntaw. The stick and knife fighting would come nearly 100% from the Philippines.

 

One of the biggest reasons I do martial arts is for the cultural exchange. Now, because of my internet show Martial Arts Odyssey, people in Cambodia are watching videos about Kuntaw, and my Filipino friends are watching videos about Bokator. It is such a great thing that the people of southeast Asia can share their culture and martial arts with each other on the internet. After I taught the soldiers in Burma, I filmed their martial art. The Shan people practice Lai Tai kung fu, and now my Filipino friends are learning about Burma.

 

I grabbed a Shan knife, which is longer than a bolo, sharp on one side, and tapers to a point. As I was walking up the trail to the training ground, a group of foreign medics came running by in formation.

 

“Come join us, do some cardio exercise.” They shouted to me.

“I hate running.” I answered. “In fact, I learned to fight so I don’t have to run.”

 

The soldiers sat at the position of attention on the parade ground. Nearly one thousand Shan rebels, whose people had been in a constant state of war from the time of their grandfathers. They wore uniforms, but most covered their feet with flip flops, or went barefoot. Their weapons were old M-16s left over from the Vietnam War and AK-47s made in China.

 

In my system of practical fighting, we start with striking, then move to grappling, and end with knife and stick fighting.

 

Before I began, I explained the program to the soldiers. Shan language is pretty close to Thai, so I use that language to communicate with them. My assistant is a Shan sergeant, named Hsai Kong, who studied Shan martial art his whole life. He speaks fluent Thai, so he helps me, translating the parts that I have trouble expressing.

 

Practical fighting contains 18 basic strikes, designed to take a non-fighter and teach him to fight inside of a week or a month. Once the fighters know the routine, they need to practice everyday. The practice begins with one session per day, of the eighteen strikes in sequence, every day, five reps each, on each side of the body. This will increase over time to ten and then twenty reps per strike on each side of the body. Just as with Kuntaw, we can use the entire body as a weapon. We start with the head and work down to the feet.

 

I got the soldiers on their feet and started. The warm up cane from Shaolin Temple. We all stood in a low, Shaolin horse stance, with hands out straight in front of you. On the first day, we only held the position for one minute. Then we stood up straight and shook it out. Next, back down in horse stance for one minute, this time doing curls with imaginary weights. Then rest. Then horse stance again, doing overhead presses with imaginary weights. We repeated the horse stance, this time doing peck deck exercise with the arms. As the weeks of practice go on, each set of horse stance could be increased to three minutes, then five, ten… Even without weights, doing all of those curls in the air, you will feel the burn.

 

After the warm up, I explained the basic premise of self-defense. Never show your intentions before you move. Do not telegraph. Wait for the right moment, and then strike hard. Never threaten or even appear aggressive till the exact moment that you attack.

 

When someone gets aggressive with you on the street, don’t scream back. Don’t look mean. Look humble. Put you hands in center of chest in prayer position and look penitent.

 

In any type of stand up grappling, the man with his hands on the inside is in the dominant position. In Thailand, we spend hours practicing our Muay Thai wrestling. Two fighters lock up, head to head, grabbing each other behind the neck. At the beginning of the exercise, they both have one arm inside and one arm outside. When the coach signals for the exercise to start, they fight to get both their arms on the inside. The fighter with two hands on the inside is in a better position to throw his opponent.

 

This is an exercise which can also be practiced as part of practical fighting. The wrestling is good upper body work. The throwing is an excellent skill to develop.

 

The reason you put your hands in prayer position when someone is threatening you, first, because this will tend to make the attacker relax and get careless. Second, because now, both your hands are on the inside. You have already got the dominant position, and you haven’t even begun yet. If your hands are on your chest, the attacker will probably grab your shoulders or throat from the outside. Strike one of practical fighting is the head butt. When the man grabs you, you grab the back of his head, pull him forward, and smash his face with your skull. He is moving forward and you move right at him, using his forces against him. The power with which he was grabbing you is now directed at his face, shattering his nose or chin.  

 

When teaching soldiers, it is important to remember that they aren’t martial artists or professional fighters. They need to learn simple, effective techniques that could save their lives in combat. But, when teaching people who have a longer time frame, these techniques can be expanded. For example, the simple head but can be made doubly as effective if before you strike, you drop, bending your knees, bringing your head down below his chin, and then pop back up with all your bodyweight, launching your head into his face, like a bullet.

 

Always remember, with a head butt, contact should be head-to-face never head-to-head.

 

In a longer course, we can actually practice these techniques with a partner. But for the short course, I have the men practice five times in the air, grabbing and striking an imaginary opponent. On the first day of training, they will do five of each exercise, eventually, over a period of time, they will build up to twenty of each.

 

Next, moving down the body from the head to the elbows, we learn the elbow strike.

 

For the rest of the exercises the men are standing in a comfortable fighting stance. The legs are roughly shoulder with width apart, with the dominant leg (for most people this is the right leg) slightly out in front. The knees should be slightly bent and a fighter should always avoid getting in a straddle stance.

 

The hands are up in a modified boxing stance, slightly higher than boxing to protect the face against elbow strikes. The elbows are slightly further apart than in boxing because you need a good field of vision all around, to be able to see kicks coming up from underneath.

 

Practical fighting includes six basic punches: Left jab, straight right, left and right upper cut and left and right hook.

 

Like in boxing, everything works of the left jab. When the jab is thrown, the whole entire weight moves forward. The hip twists into the punch, and the shoulder turns into it. The entire body must work together, with the punch originating somewhere down, deep in the Earth, working its way up the leg, to the hip, then to the shoulder and down the arm, focusing the full force of the blow on the two first knuckles.

 

In the short course, this is pretty much where the explanation would stop. Then the soldiers would practice five times. But for students who have time and desire to practice, in addition to hitting the air, you should hit a punching bag or other object many times. Afterwards, check your knuckles. If only the first two knuckles are red, then you are executing the technique correctly. If all of the knuckles are bruised, then you need to concentrate on only hitting with the first two knuckles. This will give your punch a devastating, penetrating force, like stabbing someone with the point of a knife.

 

Another advanced technique is to remember to tuck your chin into your shoulder for protection, so you don’t get hit in the chin and knocked out, while punching.

 

The right punch works the same way as the left. On both the left jab and straight right, remember to turn your fist over when you are making contact with your opponent. Concentrate on turning into the punch, twisting the hip, turning the shoulder, and landing on only two knuckles. Before you throw an uppercut, make sure to bend your knees, drop your weight, and explode upward, driving your fist into your opponent’s solar plexus, floating ribs, chin, or nose. On the hook, twist the hips and really turn your body into the punch. Don’t rotate your hand on a hook. Most martial arts teach that you should rotate your hand on all punches. But, in pro-boxing, you don’t rotate your hand on a hook. Still, you will need to concentrate and make sure that all of the force is landing on the first two knuckles.  

 

Muay Thai Boran contains sixteen basic elbows. Bokator has even more. But for practical fighting, we only teach three: overhead, uppercut, and hook.

 

To execute the overhead elbow, simply rotate your elbow from fighting position, do a big inward circle, brining the elbow high up over your head, then crash down on your opponent’s skull. Turn your body into the strike, brining all your weight down, concentrated on the point of your elbow. As a more advanced technique, lift your foot when you begin the elbow’s inward circle, smash your foot down on the ground or on the opponent’s foot at the exact second that your elbow makes contact with his head.

 

The uppercut elbow is the same as the uppercut punch. Drop low first, by bending your knees. Then, pop tall and strike your opponent under the chin.

 

The hook elbow moves just like a hook punch. You will use this one to strike your opponent in the temple, the side of the jaw, side of the nose, or to slice the skin of his forehead, causing blood to run into his eyes.

 

The soldiers practiced each elbow, five times on each side. You want to build up to doing each elbow twenty times on each side.

 

Always grab the back of your opponent’s head before doing a knee strike.  Pull him into your strike, bring your knee up into his solar plexus. Advanced fighters can strike the opponent in the chin with their knee. Another advanced variation is to drop your body weight when you grab the man’s head, then jump back up and hit him with your knee while he is on the way down. Stand up on the toes of your base leg when throwing a knee.

 

The hook knee is thrown exactly like a roundhouse kick. The entire body has to turn into. You must stand tall on the toes of your base leg, and rotate into the strike. Make sure you hip is fully engaged in this strike.

 

When kicking, use your shin, rather than your foot to hit your opponent. The shin kick, roundhouse can strike low, on the muscle of the calf. In Kuntaw, the same technique is used as a sweep, where you strike with your foot. Striking with your shin can still sweep the opponent, but it can also bruise him. If done correctly, this kick will cause his leg to drop out from under him and become useless. The next kick is just above the knee cap. Basic students are taught to throw a round house, just above the side of the knee. Advanced students learn to do a straight kick, above the top of the front of the knee, striking with the ball of the foot.

 

There is also a downward knee. This is used as a defense against a kick. When a kick comes on the right side of your body, you block it by brining your left knee high in the air, across your body, and it smashes down on your opponent’s kicking leg.

 

The entire knife fighting portion of practical fighting was taken from Filipino martial arts.

 

The best rule for self-defense knife fighting is, don’t fight with knives. If someone else has knife, pick up a stick, a rock, or a gun and take care of that situation.

 

Although the Filipnio arts of Kuntaw and Arnes have nearly unlimited numbers of knife strikes, practical fighting has to be simple. So, there are only five. Right downward slash, left downward slash, downward cut on the top of the head, upward cut through the groin and midsection, and the thrust.

 

The basic knife fighting stance is the same as Kuntaw stance. The fighter is in normal fighting position, but with the knife held in the rear hand, more or less at the center of the chest. The empty, left hand is held out in front, to be used for grappling or disarming.

 

The right downward strike is done by stepping forward and brining the blade down on the opponent’s shoulder. Imagine cutting all the way through his body, from shoulder to hip, at a 45 degree angle. The left downward strike is identical. In Kunatw, you learn to change the knife hand, handing the blade off from the right to the left. But for the soldiers, the simple technique is that the knife remains always in the right hand.

 

Next, step forward, bring the knife up over your head, and smash down on the center of the opponent’s head. You step at the same instant, imagine the blade cutting from the center of the skull all the way down, to the naval.

 

For the upward strike, the blade rotates out and in toward your body. It circles around, and comes up, under the opponent’s groin. It continues on, cutting all the way to his chin.

 

The final knife strike is a thrust. You simply step in, and drive the point of the blade into the opponent’s solar plexus, coming out somewhere in the back between his shoulder blades.  

 

As with all other techniques in practical fighting, we practice. Each strike is practiced five times on each side, building up to twenty times on each side.

 

In more advanced training, we can work with partners to practice grappling and disarming techniques.

 

The opponent strike with his right hand, the blade coming at you from the left side of your body. You block his blade with your blade. At the same time, you place your empty hand against his wrist, redirecting the strike in a safer direction. Next, grab the wrist, and slash it with your blade. Still holding tight to the wrist, slash him under the arm pit. A slash to the wrist will usually disarm an opponent. A slash under the armpit will cause lethal bleeding.  

 

If your opponent thrusts, you step in, blocking with your blade held vertically, pushing his blade down, and away. Use the combination of his motion and yours, while he is moving forward and you are moving forward, rotate your knife up into a stabbing position and stab him in the lower abdomen. With your free hand, you can grab him and pull him into your thrust.

 

The techniques can get longer and more and more complex as you practice. You can do the block, slash to the wrist, slash to the armpit, then bring the blade up through his groin, wind milling around, and smashing down on his head.

 

 

In Kuntaw we frequently use the butt of the knife as a striking or grabbing weapon. Use the butt of the knife as a hook to grab the back of is head, the same as we would do in Muay Thai. Use your body weight to pull him down and knee him in the face Step in, insert your knife into the crook of his arm and get leverage under his arm pit. Twist his arm with your blade behind him. You can easily use your free hand to take away his blade now. If it doesn’t come out easily, press against the flat of his blade with your empty hand, pushing his blade in such a way, that the handle slips through the gap between the tips of his fingers and the palm of his hand. Once he is disarmed, you can follow through, pushing on your own blade, breaking his arm and shoulder.  

 

When a thrust or strike comes, you can block it gently with your free hand. Don’t grab the wrist. Just ease the hand in a safe direction, so you don’t get stabbed. Step in with your whole bodyweight, and trap his knife arm against his chest. Now, use the butt of your knife in the side of the jaw, temple, or the back of the head. A variation of this technique, instead of the repeated but strikes, you can stab the opponent in the throat or kick his legs out from under him.

 

All of the empty hand fighting techniques can also be used in a knife fight. For example, the opponent thrusts. You block, grab his wrist and pull him towards you, using his momentum. Just be careful to redirect his blade away from you. As he is coming in, hit him with a knee in the solar plexus.  Then, reverse his knife hand, press your full bodyweight against his elbow, and drive his knife right into his googlies. While trapping an opponent’s knife arm against his body, you can step around, behind him. You can step on the back of his knee, which will drive him to the ground. Rest your body weight on the beck of his head, force him forward, stabbing him in the face with his own blade.  

 

In truth, although I like learning and teaching these techniques, I think the best defense is to avoid any situation even remotely similar to those described above. Try to grab anything and use it to your advantage. Throw sand in his eyes. Do anything, and get away.

 

For the Shan soldiers in Burma, however, fighting is not an option. They have been forced into a horrible war, where most of the casualties are innocent civilians. If they use these techniques to take out even one Burmese soldier, I will be happy.

 

 

Antonio Graceffo is the author of four books, available on amazon.com. He is also the host of the web TV show, “Martial Arts Odyssey.” To see Antonio Graceffo’s Burma and martial arts videos, click here.

http://youtube.com/results?search_query=antonio+graceffo+shan+state+army&search_type=

 

 

See his website www.speakingadventure.com

contact him Antonio@speakingadventure.com

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Philippine Knife Fighting In the War in Burma

In Martial Arts on December 1, 2008 at 5:12 pm

Article:

 

 

Philippine Knife Fighting In the War in Burma

Teaching Practical Philippine Martial Arts to the Shan State Rebels

By Antonio Graceffo

 

Using the butt of the knife for grabbing and grappling is one of my favorite knife fighting techniques. Unfortunately, the knives used by the rebels in Burma were about twice as long as the Philippine bolo. So, when I was grabbing my opponent with one end of the knife, I had to be careful not to poke out my eye with the other end.

 

Ethnic cleansing has been going on in Burma for more than fifty years. The recent cyclone has shown the world how disinterested the Burmese government is in the well-being of its own citizens. Many people also don’t know that Burma is composed of countless ethnic groups, most of whom the junta lead government is trying to kill.

 

In Shan State, the Burmese army troops frequently burn villages to the ground. They use gang rape on very young girls as a means of intimidation. They force Shan villagers to works as slaves, porters, carrying ammunition through the jungle until they die of over-work and starvation. Shan civilians are used as human mine detectors and combat shields. The Burmese soldiers hide behind the civilians during firefights.

 

The war in Burma has created more than two and a half million refuges. Some people refused to leave, however. After their village was burned and their families raped, tortured or murdered, many men join the resistance, the Shan State Army.

 

The Shan State Army (SSA) is one of the rebel groups fighting against the Burmese junta. A friend of mine, from the Swedish army, had been working with them for years. He arranged for the rebels to smuggle me across the border and have a meeting with their commander, Colonel Yawd Serk. I was asked to be his guest at a huge banquet, where he asked me to teach hand-to-hand fighting to his soldiers. 

 

For the next several months, on and off, I would sleep in the cinderblock house, belonging to the Lieutenant. Although enemy camps were so close that we could see them on the next hilltops, it is amazing how well you sleep when you are surrounded by landmines and armed soldiers.

 

I don’t like to train early in the morning. I have always been a firm believer that any training you do at 6:00 AM could be done much better at 10:30. The next morning, during a leisurely breakfast, I slowly formulated a plan as to what I would teach the men. For years, I had been developing a system of practical fighting for police and military in Taiwan and other countries. The empty hand fighting was largely based on Khmer Bokator and Muay Thai Boran, but also included grappling techniques from Kuntaw. The stick and knife fighting would come nearly 100% from the Philippines.

 

One of the biggest reasons I do martial arts is for the cultural exchange. Now, because of my internet show Martial Arts Odyssey, people in Cambodia are watching videos about Kuntaw, and my Filipino friends are watching videos about Bokator. It is such a great thing that the people of southeast Asia can share their culture and martial arts with each other on the internet. After I taught the soldiers in Burma, I filmed their martial art. The Shan people practice Lai Tai kung fu, and now my Filipino friends are learning about Burma.

 

I grabbed a Shan knife, which is longer than a bolo, sharp on one side, and tapers to a point. As I was walking up the trail to the training ground, a group of foreign medics came running by in formation.

 

“Come join us, do some cardio exercise.” They shouted to me.

“I hate running.” I answered. “In fact, I learned to fight so I don’t have to run.”

 

The soldiers sat at the position of attention on the parade ground. Nearly one thousand Shan rebels, whose people had been in a constant state of war from the time of their grandfathers. They wore uniforms, but most covered their feet with flip flops, or went barefoot. Their weapons were old M-16s left over from the Vietnam War and AK-47s made in China.

 

In my system of practical fighting, we start with striking, then move to grappling, and end with knife and stick fighting.

 

Before I began, I explained the program to the soldiers. Shan language is pretty close to Thai, so I use that language to communicate with them. My assistant is a Shan sergeant, named Hsai Kong, who studied Shan martial art his whole life. He speaks fluent Thai, so he helps me, translating the parts that I have trouble expressing.

 

Practical fighting contains 18 basic strikes, designed to take a non-fighter and teach him to fight inside of a week or a month. Once the fighters know the routine, they need to practice everyday. The practice begins with one session per day, of the eighteen strikes in sequence, every day, five reps each, on each side of the body. This will increase over time to ten and then twenty reps per strike on each side of the body. Just as with Kuntaw, we can use the entire body as a weapon. We start with the head and work down to the feet.

 

I got the soldiers on their feet and started. The warm up cane from Shaolin Temple. We all stood in a low, Shaolin horse stance, with hands out straight in front of you. On the first day, we only held the position for one minute. Then we stood up straight and shook it out. Next, back down in horse stance for one minute, this time doing curls with imaginary weights. Then rest. Then horse stance again, doing overhead presses with imaginary weights. We repeated the horse stance, this time doing peck deck exercise with the arms. As the weeks of practice go on, each set of horse stance could be increased to three minutes, then five, ten… Even without weights, doing all of those curls in the air, you will feel the burn.

 

After the warm up, I explained the basic premise of self-defense. Never show your intentions before you move. Do not telegraph. Wait for the right moment, and then strike hard. Never threaten or even appear aggressive till the exact moment that you attack.

 

When someone gets aggressive with you on the street, don’t scream back. Don’t look mean. Look humble. Put you hands in center of chest in prayer position and look penitent.

 

In any type of stand up grappling, the man with his hands on the inside is in the dominant position. In Thailand, we spend hours practicing our Muay Thai wrestling. Two fighters lock up, head to head, grabbing each other behind the neck. At the beginning of the exercise, they both have one arm inside and one arm outside. When the coach signals for the exercise to start, they fight to get both their arms on the inside. The fighter with two hands on the inside is in a better position to throw his opponent.

 

This is an exercise which can also be practiced as part of practical fighting. The wrestling is good upper body work. The throwing is an excellent skill to develop.

 

The reason you put your hands in prayer position when someone is threatening you, first, because this will tend to make the attacker relax and get careless. Second, because now, both your hands are on the inside. You have already got the dominant position, and you haven’t even begun yet. If your hands are on your chest, the attacker will probably grab your shoulders or throat from the outside. Strike one of practical fighting is the head butt. When the man grabs you, you grab the back of his head, pull him forward, and smash his face with your skull. He is moving forward and you move right at him, using his forces against him. The power with which he was grabbing you is now directed at his face, shattering his nose or chin.  

 

When teaching soldiers, it is important to remember that they aren’t martial artists or professional fighters. They need to learn simple, effective techniques that could save their lives in combat. But, when teaching people who have a longer time frame, these techniques can be expanded. For example, the simple head but can be made doubly as effective if before you strike, you drop, bending your knees, bringing your head down below his chin, and then pop back up with all your bodyweight, launching your head into his face, like a bullet.

 

Always remember, with a head butt, contact should be head-to-face never head-to-head.

 

In a longer course, we can actually practice these techniques with a partner. But for the short course, I have the men practice five times in the air, grabbing and striking an imaginary opponent. On the first day of training, they will do five of each exercise, eventually, over a period of time, they will build up to twenty of each.

 

Next, moving down the body from the head to the elbows, we learn the elbow strike.

 

For the rest of the exercises the men are standing in a comfortable fighting stance. The legs are roughly shoulder with width apart, with the dominant leg (for most people this is the right leg) slightly out in front. The knees should be slightly bent and a fighter should always avoid getting in a straddle stance.

 

The hands are up in a modified boxing stance, slightly higher than boxing to protect the face against elbow strikes. The elbows are slightly further apart than in boxing because you need a good field of vision all around, to be able to see kicks coming up from underneath.

 

Practical fighting includes six basic punches: Left jab, straight right, left and right upper cut and left and right hook.

 

Like in boxing, everything works of the left jab. When the jab is thrown, the whole entire weight moves forward. The hip twists into the punch, and the shoulder turns into it. The entire body must work together, with the punch originating somewhere down, deep in the Earth, working its way up the leg, to the hip, then to the shoulder and down the arm, focusing the full force of the blow on the two first knuckles.

 

In the short course, this is pretty much where the explanation would stop. Then the soldiers would practice five times. But for students who have time and desire to practice, in addition to hitting the air, you should hit a punching bag or other object many times. Afterwards, check your knuckles. If only the first two knuckles are red, then you are executing the technique correctly. If all of the knuckles are bruised, then you need to concentrate on only hitting with the first two knuckles. This will give your punch a devastating, penetrating force, like stabbing someone with the point of a knife.

 

Another advanced technique is to remember to tuck your chin into your shoulder for protection, so you don’t get hit in the chin and knocked out, while punching.

 

The right punch works the same way as the left. On both the left jab and straight right, remember to turn your fist over when you are making contact with your opponent. Concentrate on turning into the punch, twisting the hip, turning the shoulder, and landing on only two knuckles. Before you throw an uppercut, make sure to bend your knees, drop your weight, and explode upward, driving your fist into your opponent’s solar plexus, floating ribs, chin, or nose. On the hook, twist the hips and really turn your body into the punch. Don’t rotate your hand on a hook. Most martial arts teach that you should rotate your hand on all punches. But, in pro-boxing, you don’t rotate your hand on a hook. Still, you will need to concentrate and make sure that all of the force is landing on the first two knuckles.  

 

Muay Thai Boran contains sixteen basic elbows. Bokator has even more. But for practical fighting, we only teach three: overhead, uppercut, and hook.

 

To execute the overhead elbow, simply rotate your elbow from fighting position, do a big inward circle, brining the elbow high up over your head, then crash down on your opponent’s skull. Turn your body into the strike, brining all your weight down, concentrated on the point of your elbow. As a more advanced technique, lift your foot when you begin the elbow’s inward circle, smash your foot down on the ground or on the opponent’s foot at the exact second that your elbow makes contact with his head.

 

The uppercut elbow is the same as the uppercut punch. Drop low first, by bending your knees. Then, pop tall and strike your opponent under the chin.

 

The hook elbow moves just like a hook punch. You will use this one to strike your opponent in the temple, the side of the jaw, side of the nose, or to slice the skin of his forehead, causing blood to run into his eyes.

 

The soldiers practiced each elbow, five times on each side. You want to build up to doing each elbow twenty times on each side.

 

Always grab the back of your opponent’s head before doing a knee strike.  Pull him into your strike, bring your knee up into his solar plexus. Advanced fighters can strike the opponent in the chin with their knee. Another advanced variation is to drop your body weight when you grab the man’s head, then jump back up and hit him with your knee while he is on the way down. Stand up on the toes of your base leg when throwing a knee.

 

The hook knee is thrown exactly like a roundhouse kick. The entire body has to turn into. You must stand tall on the toes of your base leg, and rotate into the strike. Make sure you hip is fully engaged in this strike.

 

When kicking, use your shin, rather than your foot to hit your opponent. The shin kick, roundhouse can strike low, on the muscle of the calf. In Kuntaw, the same technique is used as a sweep, where you strike with your foot. Striking with your shin can still sweep the opponent, but it can also bruise him. If done correctly, this kick will cause his leg to drop out from under him and become useless. The next kick is just above the knee cap. Basic students are taught to throw a round house, just above the side of the knee. Advanced students learn to do a straight kick, above the top of the front of the knee, striking with the ball of the foot.

 

There is also a downward knee. This is used as a defense against a kick. When a kick comes on the right side of your body, you block it by brining your left knee high in the air, across your body, and it smashes down on your opponent’s kicking leg.

 

The entire knife fighting portion of practical fighting was taken from Filipino martial arts.

 

The best rule for self-defense knife fighting is, don’t fight with knives. If someone else has knife, pick up a stick, a rock, or a gun and take care of that situation.

 

Although the Filipnio arts of Kuntaw and Arnes have nearly unlimited numbers of knife strikes, practical fighting has to be simple. So, there are only five. Right downward slash, left downward slash, downward cut on the top of the head, upward cut through the groin and midsection, and the thrust.

 

The basic knife fighting stance is the same as Kuntaw stance. The fighter is in normal fighting position, but with the knife held in the rear hand, more or less at the center of the chest. The empty, left hand is held out in front, to be used for grappling or disarming.

 

The right downward strike is done by stepping forward and brining the blade down on the opponent’s shoulder. Imagine cutting all the way through his body, from shoulder to hip, at a 45 degree angle. The left downward strike is identical. In Kunatw, you learn to change the knife hand, handing the blade off from the right to the left. But for the soldiers, the simple technique is that the knife remains always in the right hand.

 

Next, step forward, bring the knife up over your head, and smash down on the center of the opponent’s head. You step at the same instant, imagine the blade cutting from the center of the skull all the way down, to the naval.

 

For the upward strike, the blade rotates out and in toward your body. It circles around, and comes up, under the opponent’s groin. It continues on, cutting all the way to his chin.

 

The final knife strike is a thrust. You simply step in, and drive the point of the blade into the opponent’s solar plexus, coming out somewhere in the back between his shoulder blades.  

 

As with all other techniques in practical fighting, we practice. Each strike is practiced five times on each side, building up to twenty times on each side.

 

In more advanced training, we can work with partners to practice grappling and disarming techniques.

 

The opponent strike with his right hand, the blade coming at you from the left side of your body. You block his blade with your blade. At the same time, you place your empty hand against his wrist, redirecting the strike in a safer direction. Next, grab the wrist, and slash it with your blade. Still holding tight to the wrist, slash him under the arm pit. A slash to the wrist will usually disarm an opponent. A slash under the armpit will cause lethal bleeding.  

 

If your opponent thrusts, you step in, blocking with your blade held vertically, pushing his blade down, and away. Use the combination of his motion and yours, while he is moving forward and you are moving forward, rotate your knife up into a stabbing position and stab him in the lower abdomen. With your free hand, you can grab him and pull him into your thrust.

 

The techniques can get longer and more and more complex as you practice. You can do the block, slash to the wrist, slash to the armpit, then bring the blade up through his groin, wind milling around, and smashing down on his head.

 

 

In Kuntaw we frequently use the butt of the knife as a striking or grabbing weapon. Use the butt of the knife as a hook to grab the back of is head, the same as we would do in Muay Thai. Use your body weight to pull him down and knee him in the face Step in, insert your knife into the crook of his arm and get leverage under his arm pit. Twist his arm with your blade behind him. You can easily use your free hand to take away his blade now. If it doesn’t come out easily, press against the flat of his blade with your empty hand, pushing his blade in such a way, that the handle slips through the gap between the tips of his fingers and the palm of his hand. Once he is disarmed, you can follow through, pushing on your own blade, breaking his arm and shoulder.  

 

When a thrust or strike comes, you can block it gently with your free hand. Don’t grab the wrist. Just ease the hand in a safe direction, so you don’t get stabbed. Step in with your whole bodyweight, and trap his knife arm against his chest. Now, use the butt of your knife in the side of the jaw, temple, or the back of the head. A variation of this technique, instead of the repeated but strikes, you can stab the opponent in the throat or kick his legs out from under him.

 

All of the empty hand fighting techniques can also be used in a knife fight. For example, the opponent thrusts. You block, grab his wrist and pull him towards you, using his momentum. Just be careful to redirect his blade away from you. As he is coming in, hit him with a knee in the solar plexus.  Then, reverse his knife hand, press your full bodyweight against his elbow, and drive his knife right into his googlies. While trapping an opponent’s knife arm against his body, you can step around, behind him. You can step on the back of his knee, which will drive him to the ground. Rest your body weight on the beck of his head, force him forward, stabbing him in the face with his own blade.  

 

In truth, although I like learning and teaching these techniques, I think the best defense is to avoid any situation even remotely similar to those described above. Try to grab anything and use it to your advantage. Throw sand in his eyes. Do anything, and get away.

 

For the Shan soldiers in Burma, however, fighting is not an option. They have been forced into a horrible war, where most of the casualties are innocent civilians. If they use these techniques to take out even one Burmese soldier, I will be happy.

 

 

Antonio Graceffo is the author of four books, available on amazon.com. He is also the host of the web TV show, “Martial Arts Odyssey.” To see Antonio Graceffo’s Burma and martial arts videos, click here.

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