Get Smart: Build your house on the rock Don't buy real estate in an earthquake zone

By Stephen A. Nelson

After I made my first post (in 2005) about Why I Never Invested in Taiwan Real Estate, I got this rebuttal: 

"I'm not sure whether your main reason for not buying is valid, or at least for me it isn't. There are many risks that we all take on a daily basis... The chances of the next big earthquake occurring with the epicentre located where you live and your apartment falling down, all in your life-time, are very slight indeed."

So here I re-present my reply, even as the Japanese calculate the odds against a triple disaster - earthquake, tsunami and nuclear meltdown - all happening at the same place at the same time:
 

With all due respect, ["very slight indeed"] is what the people in Puli and Taichung [cities closest to the epicentre] said right before the 921 Earthquake in 1999.

But, as I noted, earthquakes are not your only worry. Typhoons and floods happen every year.

The city of Taipei is built on a mud basin.

And as Typhoon Nari showed, anywhere - including the entire city - can be a flood zone.

As for the non-tangible reasons for buying a house (sense of accomplishment, pride of ownership, et cetera): Been there, done that, bought the T-shirt.

A lot of those non-tangible reasons are not really sound investment principles but things that agents and others tell you to make you feel better about something that is not always a sound financial move.

Yes it feels great to "own your own home." A man's home is his castle. But it is not always a wise investment.

It's like buying life insurance: If you are doing it for someone else, that's great and there are many non-logical reasons you may wish to do so - looking after your family, protecting yourself in case of severe injury, et cetera.

But if you are buying life insurance as a financial investment, there are better ways to get a safe investment and a good return on your money.

In short, I'll continue to rent, claim my income tax deduction, and store up my treasure somewhere else.

Addendum:

Taipei has it's own triple risks - besides being a flood zone.

• Taipei 101 (formerly world's tallest skyscaper) is built right on an active fault - and building the tower likely destabilized it.
• The volcanoes of Yangmingshan (mountains at the northern edge of Taipei) are dormant but not dead.
• There are two nuclear plants near Taipei, just on the far side of Yangmingshan.

Buying property in an Earthquake zone: Why I never invested in Taiwan Real Estate

By Stephen A. Nelson

In light of the recent earthquakes and tsunami in Japan, I am re-presenting something I wrote in Forumosa about the wisdom of  buying a house or apartment in Taiwan - apart from the legal barriers and technical difficulties.  At the time, people disagreed with me and provided all the formulaic reasons for buying - "pride of ownership" et cetera. But I think this still stands - unlike the apartments in central Taiwan's earthquake zone.

1. First rule of investment:

If it appreciates, buy it. If it depreciates, lease it.

2. First rule of building houses:
"No man builds a house unless he first counts the cost."

As some have noted, When you buy a house/apartment, there are costs besides the mortgage, including, but not limited to: taxes, maintenance fees, legal fees, and (esp. if you plan to rent it out) agent's fees.

Oh, and insurance, which brings us to the next item...

3. Ancient wisdom about building in a flood zone. 
The wise man built his house upon the rock.
The rain came down, the streams rose, and the winds blew and beat against that house; yet it did not fall, because it had its foundation on the rock. 

The foolish man built his house upon the sand. The rain came down, the streams rose, and the winds blew and beat against that house, and it fell with a great crash." 

4. Did you feel that?
Earthquakes happen every day in Taiwan. 
The last "big one", September 21, 1999, was a magnitude 7.3.

The strongest aftershock, three days later, was 6.8. That's like calling Nagasaki an aftershock of Hiroshima
And you know what? Seismologist say that the 921 Earthquake WASN'T "the big one."

Oh, and most of the buildings that were destroyed were new buildings.

5. Rule of thumb for would-be home owners
Never buy a house/apartment in an earthquake zone. 

6. Ancient wisdom from 60s British television
"Anything can happen in the next half-hour!" 

The Last word in edgewise
If you want an investment, buy mutual funds, RSPs or life insurance.
If you want a place to live, rent a house or apartment.

Formosa Displayed, Formosa Betrayed: Taiwan's 228 Museum Rewriting History?

Taipei 228 exhibits spark controversy

GLOSSING OVER: Critics said the government had demonstrated arrogance with its interpretation of history and had disrespected the incident’s victims and their families 

From The Taipei Times, Feb. 20, 2011

The Taipei 228 Memorial Museum is reopening its doors to the public this morning after a 10-month renovation, but its efforts to reveal the truth of the 228 Incident met with challenges as pro-independence activists and family members of the incident’s victims yesterday accused the museum of glorifying the acts of the then-government and distorting the truth with its selection of documents.  

Full story:

http://www.taipeitimes.com/News/front/archives/2011/02/20/2003496332/1

The Way It Was...

The Well of Souls: Taipei 2-28 Memorial Museum

By Stephen A. Nelson

(from The Brandon Sun, May 1, 2010)

A stone’s throw from the Chiang Kai-shek Memorial Hall, there is another museum; different in every way from the shrine dedicated to Chiang. This is the Taipei 2-28 Memorial Museum.

Everything about the 2-28 museum stands in stark contrast to the Chiang memorial. Instead of a great monument in the midst of a vast parade square, the 2-28 museum is a small building in quiet corner of a downtown park. If Chiang Kai-shek Memorial Hall is the Great Pyramid of Cheops, this is the Well

of Lost Souls.

The museum stands in the shadows of the other great edifices erected by the Japanese: The presidential palace, the parliament buildings, the National Taiwan University Hospital.

And like those public buildings, this place was designed in the Asian Glory style — simple lines incorporating Western elements — that was favoured by the Japanese when they ruled Taiwan in the first half of the 20th Century.

Originally, this building was home to the Taipei Broadcasting Bureau — the model radio network set up by the Japanese for their model colony. When the Japanese were forced to surrender Taiwan at the end of the Second World War, the KMT government took over the radio network and renamed it the Taiwan Broadcasting Company. 

The network played a central role in the events of the 2-28 Incident, as both sides commandeered the radio station to broadcast their messages. From here, the Taiwanese sent out their SOS to the world.

So what is the 2-28 Incident? And why should people want to remember it? My Taiwanese friends describe it as Taiwan’s own Tiananmen Square Massacre, the central event that is at the heart of the story told in Formosa Betrayed: a military crackdown — carried out by Chiang’s troops on February 28, 1947 — that marked the beginning of Taiwan’s martial-law era. Tens of thousands “disappeared” during what became known as The White Terror.

The history books always said that the crackdown was necessary to put down an insurrection, weed out communist agents and protect Taiwan. But if history is written by the winners, this 2-28 museum tells the story of the losers. Here, the faces of those lost souls look you in the eye and silently plead with you to make sure that their stories are not forgotten...

UNTIL NOW!

Further reading:

Return to Taiwan's Dark Days

http://www.atimes.com/atimes/China/KA17Ad01.html

Devils and Angels in Taiwan
http://www.atimes.com/atimes/China/JD11Ad04.html

Photos from the Old 228 Museum, before the renovations, revisions and rewrites.

http://www.facebook.com/album.php?aid=164636&id=234843808294&fbid=389160738294

Find links to my other Taiwan and travel stories:

http://www.facebook.com/?ref=home#!/pages/Stephen-A-Nelson-Writer-Editor-Traveller-and-More/374226352256

Choose This Day Whom You Will Serve or So You Wanna Go Back to Egypt?

 In a follow up to yesterday's post, Michael Turton summarizes his criticism of Jerome Cohen this way:

"You can't support democracy and the KMT/CCP ECFA sellout talks at the same time, since the ultimate success of the latter entails the loss of the former."

Turton also says, "these two positions are inherently contradictory: the KMT and CCP can only kiss and make up over the dead body of Taiwan's democracy."

http://michaelturton.blogspot.com/2010/08/jerome-cohen-neither-green-nor-blue.html

Which is funny, because the KMT/CPP talks have always reminded me of the political cartoon of Adolph Hitler and Joseph Stalin meeting over the dead body of Poland. (above)

Turton also notes that Cohen's attempt to stake out the high middle ground has made him a target for both sides: supporters of democracy in Taiwan and supporters of annexation/unification in China.

"The reason they are both shouting at Cohen is not because he has found some lofty perch in the Moderate Middle but because his position is incoherent and self-defeating."

This makes me wonder about the Via Media that KMT Leader Ma Ying-jeou promised when he was running for president - and continues to promote as a "way forward" for Taiwan to get out of the political and diplomatic wilderness that the KMT put it in.

But whenever Ma (a.k.a. the Telflon President) talks about the Via Media, it always reminds me of the politician who says he has found the Golden Mean between honesty and dishonesty. And this way "out of the wilderness" leads straight back to Egypt.

When will the Taiwanese wake up a see that there can be no Via Media between Annexation and Independence? No Golden Mean between tyranny and freedom?

Surely what has happened in Hong Kong is a lesson written in Chinese characters (socialism with Chinese characteristics?) big enough to see across the Taiwan Strait? "Hong Kong people governing Hong Kong people" doesn't mean autonomy or democracy.

Yet it seems everyone in Taiwan clings to the myth of status quo and repeats the mantra that Hong Kong tour guides have learned so well: "Nothing has changed."

The Golden Path they have chosen is paved with Fool's Gold and is, in fact, Via Dolorosa

The way I see it, the Children of Taiwan have to choose: either they cross over into the Promised Land of democracy and independence or go back to China - back to the house of bondage.

But they think they can continue to wander in the wilderness, worshipping their Golden Calves - Chiang Kai-shek and the God of Fortune.

Rule of Law: Neither "Green" nor "Blue" but maybe Turquoise when you take off the rose-coloured glasses

In Taiwan's colour-coded politics, being "Blue" means being pro-Kuomintang (KMT or Chinese Nationalist Party), defending their dictators and supporting their one-China policies. 

On the other hand, being "Green" means being pro-democracy, pro-Taiwan independence and supporting the parties that have spearheaded the movement, chiefly the Democratic Progressive Party (DPP).

Most expat businessmen I met in Taiwan supported the KMT (either implicitly or explicitly) because, basically, "they make the trains run on time." 

Diplomats were divided, but I found that (privately, at least) the more they actually knew about Taiwan, the more they were pro-Taiwan and pro-Green.

Most real journalists I knew supported the goals of Taiwan Independence and democracy, even if they didn't necessarily support the DPP or its political allies.

When I worked in Taiwan, I was accused of being Green (by the aforementioned expat businessmen) - and therefore supporting the DPP - because I supported real democracy. And because I insisted that Taiwan was a real country - no matter what Beijing or Washington said.

And when I was critical of the KMT or its dictators (from Chiang Kai-shek to Ma Ying-jeou), I was told, "You are not Chinese, so you do not understand." 

I confess I am no expert on Taiwan or China; merely a scribe who tries to learn and understand - and then explain to others. 

But apparently, I am in good company. Professor Jerome A. Cohen is co-director of NYU School of Law’s US-Asia Law Institute and adjunct senior fellow for Asia at the Council on Foreign Relations. 

In an op-ed that first appeared in the South China Morning Post, Cohen argues that he is neither "Green" nor "Blue". But Cohen  says he has been accused of being "Green" because does support rule of law, accountability in government and an independent judiciary that is not merely the tool of an autocratic party that hungers for the old days of martial law. 

And, of course, Cohen has been told that he does not understand and appreciate the "one-China" principle because he is not Chinese.

http://www.usasialaw.org/?p=4024 

My friend, Michael Turton, who makes no bones about being Green (pro-Taiwan, pro-democracy) responds by saying that Cohen is so busy correcting other people's colour blindness that he forgot to take off his rose-coloured glasses.

http://michaelturton.blogspot.com/2010/08/jerome-cohen-neither-green-nor-blue.html

First - Kill All the Lawyers: Premier Legal Advice for Becoming a World-Class Business

By Stephen A. Nelson

 Renowned Taipei lawyer C.V. Chen has some advice for anyone doing business in Taiwan and China: "Get good legal advice" and make it an integral part of your decision-making process.
 

Chen is a managing partner at Lee and Li, one of Taiwan's premier law firms. He gave his free advice while speaking at a joint meeting of the British, American and French chambers of commerce in Taipei.

Chen warmed up the crowd by telling a couple of jokes at his own expense. He first cited William Shakespeare's best-known legal advice, "First, kill all the lawyers!"

Then he asked, "How can you tell when a lawyer is lying?"

This reporter was the only one who dared speak aloud the correct answer,"How can you tell when a lawyer is lying? His lips move."  

"That's right," Chen concurred.

All kidding aside, Chen engaged his audience with true stories and cautionary tales underlining the importance of being honest. Well, at least legal. That means paying attention to:

• the law in your home country
• the law in those countries where you do business
• international law

Those who fail to obey the law do so at their own peril, Chen says. And this holds true whether you're a foreign business operating in Taiwan or a Taiwanese business operating in another country.

Yes, even in China. And even though Chen admits that "rule of law is a foreign concept in Chinese society."

From April, 2005

Look Through Your Window: A Room With A View

A view of Taipei's RenAi Road, from the RenAi traffic circle, looking east towards city hall and Taipei 101.
Taipei 101 is no longer the world's tallest skyscraper - but it is impressive at night.

Around this traffic circle are a 24-hour bookstore (with a 24-hour coffee shop) and a 24-hour Cantonese restaurant.