Annual Christmas Letter

Dear Friends,                                                                                                           December 8, 2010

Seasons Greetings. I hope that it has been a good year for you and those you love. It has been for me, but it remains a troubled time for western economies and for those parts of the world in which we have militarily involved ourselves and in a few in which we haven’t. Here are the highlights of my year. You can read my more extensive comments on my travels, the economy, and other things that have interested me at

My first trip of the year, as usual, was to Grand Cayman Island for the quarterly board meeting of the Cayman Islands Monetary Authority ( My trip there for the May board meeting was my last. Although I was reappointed to the Board for a third, three-year term, I resigned during the summer effective the end of this year. I have good memories and some lasting friends from the experience (Richard Rahn, Tim Ridley, Jane Wareham, and Bill and Patricia Gilmore).

My second trip of the year was to Nairobi, Kenya for the IMF to continue my technical assistance to the Central Bank of Kenya (CBK) on how to improve its formulation and implementation of monetary policy. But this year was very special because I brought my 16-year-old grandson Bryce with me. It was Easter break for him and the CBK was closed from Good Friday through Monday, which gave us a perfect opportunity to drive to the Masia Mara game reserve near the Tanzania boarder for three days and two nights. This added some memorable pictures to my collection, which you can see on my Facebook pages.

The spring also included some fun domestic trips. My long time friend Jim Roumasset and I went to Boston at the end of April for Peter Diamond’s grand retirement party at MIT. Jim and I had had several courses from Diamond at UC Berkeley in the mid 60s. Subsequently Diamond shared this year’s Nobel Prize in Economics. Our Congress is still trying to figure out if he is qualified to be on the Board of Governors of the Federal Reserve. In mid May I flew out to my hometown of Bakersfield for my 50th high school reunion and to celebrate my shared birthday with my dad (what a birthday present he got when I was born).

In July Ito joined me for a trip to Robert Mundell’s annual gathering of economist at his home near Sienna, Italy. We stopped in London to visit Ito’s niece and in Florence to sightsee. We made friends with Bill Middendorf and his daughter Frances, who are both fascinating and enjoyable people.

In early September I was sitting in my gazebo reading about the collapse of Kabulbank, Afghanistan’s largest bank, when the IMF called to ask if I could join the mission leaving that evening for Kabul to help the authorities manage the Kabulbank crisis and to negotiate a new program with the IMF. It was an intense visit with a great IMF team providing little sleep. I traveled from Kabul on to Juba, Southern Sudan (via Dubai and Nairobi), which I did again after returning to Kabul a month later October – November). You can read about Kabulbank in the NYT or Washington Post. I continue to advise the Central Bank of Iraq from afar for the IMF.

I met with Southern Sudanese officials four times this year, once in Nairobi (June) and three times in Juba (July, September and November) after giving up my determination not to go there. As their independence referendum in January gets closer they are paying more and more attention to the issues we (Deloitte/USAID) are advising on (setting up a new post independence central bank and issuing and managing a new currency). On our last visit (November) we were finally meeting with the actual decision makers and we are hoping to convince them to adopt currency board rules for their new currency.

Between my September and November trips to Kabul/Juba, I also managed to attend my nephew Scott Naninga’s wedding in Santa Rosa California, and visit Daylin and Brandon and my grandkids in North Bend, WA and Vancouver, WA while on my way to the Mont Pelerin Society meetings in Sidney, Australia, all in October.

In mid November while I was in Juba my father tripped and fell and sprained his shoulder in Bakersfield and for a few days I feared that I would have to cancel another Thanksgiving dinner, but he is doing fine. My final trip of the year will be to Paris Dec 9-12 for a conference on “The International Monetary System: Old And New Debates,” to discuss the SDR as an international reserve asset.

Ito continues to draw/paint, play the piano and violin, and write while searching for the cure to cancer on the frontiers of molecular biology research at the National Cancer Institute in Fredrick Maryland, thus providing some stability and continuity to the family. So life at home is good when I am there.

Best wishes,