Friday Night Links

• The Covid vaccines seem to have higher risks that previous vaccines. However, Covid itself is still killing many people. Even with increased risks compared to previous vaccinations, most Americans over 30 have a much greater risk of dying from Covid than vaccination, even under the worst possible assumptions. If you’ve been hesitating, and you’re a man 20 years or older or a woman 40 years or older, it’s almost certainly to your benefit to get vaccinated unless you are one of the exceptionally healthy people I describe below. I wish the medical establishment would be less defensive and admit the increased risk, while still encouraging vaccination among those better off taking the risk. Their obfuscation and denial is probably killing more people than generalized vaccine skepticism. [The Tom File]
• “Normosmia is an independent predictor of admission in Covid‐19 cases,” concludes a California study of 169 patients. “Smell loss in Covid‐19 may associate with a milder clinical course.” Normosmia means normal olfactory function. Similarly, a Spain studypublished in June found those experiencing smell loss early had a 58% lower odds of progressing into severe Covid-19. Moreover, a China studyreported that only 5.1% of 214 hospitalized patients had smell disturbance. This is rather a huge gap compared to the usual prevalence of smell loss of roughly 75%. [link]
  
• By snipping the bond between the S1 and S2 subunits, the furin cut loosens up virion spike proteins so that during cell entry they respond to a second cut by TMPRSS2, which exposes the hydrophobic area that rapidly buries itself in a host-cell membrane, says Gallagher. If spikes are not pre-clipped by furin —and they aren’t always — they bypass TMPRSS2, and enter through the slower endosomal pathway, if at all. Two coronavirus variants, Alpha and Delta, have altered furin cleavage sites. In the Alpha variant, the initial proline amino acid is changed to a histidine (P681H) ; in the Delta variant, it is changed to an arginine (P681R). Both changes make the sequence less acidic, and the more basic the string of amino acids, the more effectively furin recognizes and cuts it, says Barclay. “We would hypothesize that this is the virus getting even better at transmitting.” More furin cuts mean more spike proteins primed to enter human cells. In SARS-CoV, less than 10% of spike proteins are primed, says Menachery, whose lab group has been quantifying the primed spike proteins but is yet to publish this work. In SARS-CoV-2, that percentage rises to 50%. In the Alpha variant, it’s more than 50%. In the highly transmissible Delta variant, the group has found, greater than 75% of spikes are primed to infect a human cell. [Nature]
• It is telling that when Dr. Shi introduced the world to CoV-2 for the first time in January 2020 she showed hundreds of gene sequences of this novel virus but stopped just short of showing the furin site, the one she is purported to have introduced, seemingly not wanting to call attention to her handywork. She apparently failed to realize that an accomplished but innocent virologist, finding the first furin site ever seen in this class of viruses apparently coming from nature, would have featured the presence of the furin site prominently, and also would have used its presence and her experience with furin sites in other viruses to predict what it would foretell for the world due to its aggressive nature. [CBS]
• The dual-use gain-of-function research tool of serial passage was first applied to a strain of H1N1 Swine Flu, a variant of the pandemic influenza virus that was genetically modified before it either leaked out of a Soviet lab or was introduced as part of an attenuated vaccine trial in 1977. Although no one has ever taken responsibility for the introduction of this virus, it would become the first known example of a virus created by serial passage leaving a lab, which was later determined due to its inexplicable genetic distance from any known sister strain. This extra distance would be expected since serial passages artificially accelerates genetic divergence between taxa, resulting in the accumulation of genetic distance at a much faster rate than it occurs in a natural setting. Then in 1979, just 2 years after the introduction of this modified H1N1 Swine Flu, a different Soviet lab leaked weaponized anthrax out through an improperly maintained exhaust filter, and Soviet authorities convincingly blamed the deaths on contaminated local meat. This cover up withstood a formal inquiry conducted in 1986, and was not revealed to be a fabrication until 1992, when an analysis of dispersion patterns revealed that the victims were not those working with the supposedly contaminated meat, but instead all lived downwind from the Sverdlovsk weapons lab and its improperly maintained exhaust vent. Therefore, there is a history of denying laboratory leaks on the commercial meat industry that dates back about 40 years, an effective excuse that provided the Soviets with an alibi that held up for nearly 2 decades.
  [Karl Sirotkin]
  
• Herein lay the spring of the mechanical art and mystery of educating the reason without stooping to the cultivation of the sentiments and affections. Never wonder. By means of addition, subtraction, multiplication, and division, settle everything somehow, and never wonder. Bring to me, says M’Choakumchild, yonder baby just able to walk, and I will engage that it shall never wonder. [Charles Dickens]
• Karl told me that it was prohibitively expensive for pilots over seventy to be insured for planes with retractable landing gear, because pilots over seventy didn’t always remember to put the landing gear down. [New Yorker]
• [T]here are books you don’t know you want and you won’t know you want them until they’re standing on a shelf in front of you. [link] 
• At long last, an automaker has given us an EV that competes head to head with Tesla on design, performance, price, and range, and it neither looks nor feels like it was built in a tent. [Car and Driver]
• A systematic review of studies measuring the changes in linoleic acid concentration in subcutaneous adipose tissue in the USA revealed an approximate 2.5-fold increase in linoleic acid increasing from 9.1% to 21.5% from 1959 to 2008. Importantly, the concentration of linoleic acid in adipose tissue is a reliable marker of intake as the half-life of linoleic acid is approximately 2 years in adipose tissue. The authors of the study also noted that the increase in adipose tissue linoleic paralleled the increase in the prevalence of diabetes, obesity and asthma. [BMJ]
• In the United States, per capita dietary LA tripled from about 2% of energy (en%) to 7 en% during the 20th century, which coincided with a marked increase in adipose tissue LA. Because human adipose tissue LA has a half-life of 1-2 years, the gradual mobilization of LA from adipose stores into circulation is expected to lengthen the time to steady state when lowering dietary LA. [NLM]
  
• Forget for now that coordinating with others to artificially push a stock price higher is blatant illegal manipulation. I’m more interested in what it means for society and markets going forward, especially after listening to the brilliant and prolific Demetri Kofinas discuss the subject. Kofinas is the creator of the wildly popular podcast Hidden Forces – a weekly must-listen for this chicken. Both as a host on his own show and as a guest on others, he has discussed the concept of market nihilism to describe what happens when people not only invest in something that is essentially worthless, but they invest in it because it is essentially worthless, assuming only that others will follow them into the scheme. There’s a purposeful emptiness in the decision. [Doomberg]
• Before, a company with a small R&D budget could whip up a product and use Amazon’s sales and fulfillment network to create a viable alternative to TPB and other tobacco companies’ products. Now, all products must go through the expensive and unappealing PMTA process, then they must find a site that can sell their product online that isn’t Amazon or compete for shelf space at brick-and-mortar locations. These new requirements mean new entrants will be very rare and those established players without scale, bargaining power, or a solid reputation in the industry will be severely weakened. [nontargettakes]
• We were active in the capital markets during the second quarter as we repaid $1.5 billion of notes upon maturity, paid approximately $1.6 billion in dividends and repurchased 6.6 million shares totaling $325 million. We have $1.35 billion remaining under the current authorized $2 billion share repurchase program, which we expect to complete by June 30, 2022. Because the current program is limited to $2 billion, additional share buybacks in connection with the sale of Ste. Michelle are subject to Board approval. [Altria]
  
• In the second quarter of 2021, Suncor remained focused on maximizing the return to its shareholders through the repurchase of approximately 23 million common shares for $643 million under the company’s share repurchase program, and payment of  $315 million of dividends. Share repurchases in the quarter represent 1.5% of Suncor’s issued and outstanding common shares as at January 31, 2021. Since the start of the normal course issuer program (NCIB) in February 2021, the company has repurchased $961 million in common shares, representing approximately 35 million common shares at an average share price of  $27.47 per common share, or the equivalent of 2.3% of Suncor’s issued and outstanding common shares as at January 31, 2021. Subsequent to the second quarter of 2021, Suncor’s Board of Directors (the Board) approved an increase to the company’s share repurchase program to approximately 5% of the company’s outstanding common shares as at January 31, 2021. Concurrently, the Toronto Stock Exchange (TSX) accepted a notice to increase the maximum number of common shares the company may repurchase pursuant to its NCIB to approximately 5%. The increase to the program demonstrates management’s confidence in the company’s ability to generate cash flow and its commitment to return cash to shareholders. [Suncor]
• Ventura, CA is the perfect place for agriculture (as evidenced with it being filled with a wide variety of agriculture for the past 100 years). Most of the avocados in the country are grown there and Driscoll’s, one of the countries largest berry producers has large operations based there. I have spent years following Limoneira (NASDAQ: LMNR), one of the largest avocado and lemon growers in the country, which is based in Ventura. The same weather that people love, plants and trees love as well. The coldest average temperature is 47 and the highest average temperature is 73. It is heaven with a nice ocean breeze with some of the most plentiful sunshine in California. I know this, because I live in Santa Barbara, the county just north of Ventura. Cannabis is a sensitive plant and needs to be grown in a very specific temperature range, which is why almost all premium cannabis is grown indoors or in greenhouses. Outdoor cultivation only happens seasonally when the weather is right. And even then, most outdoor cannabis is lower quality, sells for a big discount and is used more as an input to a process to make a product like an edible or tincture. I mention all of this because the Ventura, CA referendum was a boon for one massive greenhouse in particular, a complex of 5.5 million square feet that is on 140 acres and currently grows tomatoes and cucumbers. [Aaron Edelheit]
• This Essay provides the first analysis of the constitutionality of state restrictions on interstate commerce in cannabis. It challenges the conventional wisdom that the federal ban on marijuana gives legalization states free rein to discriminate against outsiders in their local cannabis markets. It also debunks the justifications states have proffered to defend such discrimination, including the notion that barring interstate commerce is necessary to forestall a federal crackdown on state-licensed cannabis industries. The Essay concludes that the restrictions legalization states now impose on interstate commerce in cannabis likely violate the Dormant Commerce Clause (DCC). The Essay also examines the ramifications of this legal conclusion for the future of the cannabis market in the United States. It suggests that without the barriers that states have erected to protect local firms, a new breed of large, national cannabis firms concentrated in a handful of cannabis-friendly states is likely to dominate the cannabis market. [Robert Mikos]
• Sales of cannabis explodes higher by two to three times when adult use is allowed. Getting a medical card for cannabis in a state that allows medicinal use is not hard, nor is it hard to get a prescription. So, why do sales jump when you remove the simple barrier of getting a medical card? I believe that most people want to follow with the law. Cannabis is still illegal on a Federal level and carries a stigma that is decades in the making based on industrial corruption, misperceptions, racist overtones and outright lies. Once a state fully legalizes cannabis, I believe that the stigma of using it plummets. That is why sales jump so much. And I believe that a major reason that generalist money managers are not investing in cannabis is that it “feels wrong.” Investors who are happy to invest in tobacco, alcohol or even weapons manufacturers are not yet willing to invest in cannabis. [Aaron Edelheit]
• I believe that Neanderthals adapted very well to the cold climate of North Eurasia, and evolved away from many ancestral human characteristics that we now code as “modern.” Yes, I’m saying modern humans are quite possibly more “primitive” than our long-lost cousins. This Denisovan population and modern humans probably resemble a general ancestral variety, while the Neanderthals were hyper-specialized in their adaptations, an exemplar of evolution in overdrive. [Razib Khan]
• Mark Twain, who was a fierce opponent of the efforts to plant the seeds of empire in Cuba, the Philippines, Guam, Hawaii and Puerto Rico, wrote an imagined history of America in the twentieth-century where its “lust for conquest” had destroyed “the Great Republic…[because] trampling upon the helpless abroad had taught her, by a natural process, to endure with apathy the like at home; multitudes who had applauded the crushing of other people’s liberties, lived to suffer for their mistake.” Twain knew that foreign occupations, designed to enrich the ruling elites, use occupied populations as laboratory rats to perfect techniques of control that soon migrate back to the homeland. It was the brutal colonial policing practices in the Philippines, which included a vast spy network along with routine beatings, torture, and executions, which became the model for centralized domestic policing and intelligence gathering in the United States. Israeli’s arms, surveillance and drone industries test their products on the Palestinians. [link]
• Stock repurchases are being revived or raised across the board as sectors as diverse as steelmakers, retailers and manufacturers ride the crest of economic expansion. In particular, Big Oil executives are seeking to reward shareholders as commodity prices rise, a turnaround from previous booms when excess cash was poured into costly growth projects. [Bloomberg]
• U.S. oil consumption is rushing back much faster from the pandemic slump than first predicted as Americans are hitting the road, unleashing a burst of pent-up travel demand. Consumption is so strong that the federal Energy Information Administration on Friday pegged May’s demand for U.S. oil products at 20.094 million barrels a day, or almost 7% higher than its original estimate. The demand, which the EIA classifies as product supplied, still remains below where it was in 2019, before the coronavirus interrupted travel for millions. But surprisingly, it’s within spitting distance of the May 2019 figure of 20.387 million barrels a day. [Bloomberg] 
  
• Musk’s approach to many manufacturing issues was, and still appears to be, keeping the assembly line moving while line problems are being fixed. He’s not a fan of the Toyota method, where a worker can stop the line until the problem is solved. He’s all about the volume. That may be one reason why the quality of Teslas is so variable — why buying one can feel like a crapshoot. Some owners report their car is perfect; some say they were sold a piece of junk. (Including Kristen Wiig and Avi Rothman.) In fact, Toyota ended a partnership with Tesla over such issues. “Musk was willing to let some quality issues slide if addressing them meant slowing down their schedule…” [link]