Friday Night Links

• Quinones points out that the 21st-century history of drugs is supply-side-driven. Few drug addicts dream up new highs and make them happen. Instead, global capitalists, whether the Sacklers, Chinese manufacturers, or Mexican cartels and entrepreneurs, invent new drugs to solve their business problems. [Sailer]
• The reason Comirnaty isn’t available is because those shots would expose the company to liability since the fully-licensed product doesn’t have the liability waiver of the EUA product. But once the Pfizer vaccine is fully approved in kids, then Pfizer gets liability waiver on all age groups due to a “feature” in federal law for child vaccines (NCVIA). At that time, they are done. They can market the COVID vaccine products under full approval for all age groups and face no liability when it kills or disables you. This is why they are focused on the kids. This is why there is a reformulation at a 1/3 dose and they changed the buffer and the storage conditions (low temperatures not required). All of these will weaken the protection, but result in a safer vaccine (since it is ineffective). But for the clinical trials on the 5-11 year olds, they did not use the formulation they approved in the meeting. This is known as bait and switch. So they used a more effective vaccine to show efficacy (in the trials they completed), then they get the FDA to approve the drug but with a change in formulation, then the product product with the new buffer will go out to the public with the lower efficacy, but better safety. This is because they don’t want to jeopardize any adverse events happening until they are fully approved. So they basically use formula 1 for safety, get approval for formula 2 (safer, less effective), then roll out formula 2 under EUA. They also arrange with the FDA and CDC to make sure no early treatment drugs get approved or recommended. This is why there is no movement on fluvoxamine, ivermectin, etc. since that would blow the EUA. Fluvoxamine is the best drug ever for COVID with a mortality reduction of 12X when taken early. It’s the best drug to date for COVID, but the CDC and NIH are deliberately burying it until the vaccines are fully approved. Then they’ll say, “ok, we have all the data.” [Steve Kirsch]
• Fluvoxamine was shown in a large Phase 3 clinical trial to reduce death from COVID by 12X. This is the most effective drug ever discovered for COVID. Nothing else has a better effect size. All the earlier trials were 100% successful. It even works in hospitalized patients. The FDA, CDC, NIH, and WHO all ignored it. Stunning, but totally expected. It only works if it is from a major US drug company. Repurposed drugs don’t count. [Steve Kirsch]
• Imagine if a hyper-intelligent and perceptive communistic space alien landed in America of 1988, and wrote an account of his impressions of the country.  The book America against America, published in 1992, is such an account. The author, Wang Huning is one of the most important people in China today; China’s “grey cardinal.” You’d think the meteoric success of China, and the ridiculously precipitous decay of America, incidentally predicted in every detail by this book would make America against America a widely studied book by US intelligentsia, but it’s so forgotten there isn’t even a wiki entry for it for me to link to. It isn’t available on Amazon (have a look at what Amazon thinks you’re looking for and despair), nobody talks about it, and you have to be resourceful to find it. People do know about Wang Huning; I had read something about him before the recent Palladium article in WSJ and Foreign Affairs, but somehow his seminal book remains un-commented upon and presumably largely completely unread. A book telling us what the Chinese elite think about their greatest geopolitical rival; seems somewhat relevant to current year. [Scott Locklin]
  
• Silver misses the opportunity to develop systematic explanations for why people make bad predictions, for example the principal/agent problem. The problem is that Silver is a technocrat so he can't tell you that bureaucrats make bad predictions because of an incentive misalignment wherein they prioritize their careers over the lives and property of those whom their predictions can harm. [CBS]
• Note the last two comments on our Rethinking Inflation post, recent quotes from the two smartest options traders that we know: the "distribution of future inflation has a fat right tail" and "Implied Volatility is way too low since the range of outcomes is now much wider." [CBS]
• Lyall’s liquidity and redemption flywheel theory would mean that instead of a bubble making it so that you have to sit on your hands, a bubble causes the tide to go out from investments that are “cold” and we should be looking for those. Based on the theory, they would be investments that had done poorly recently for whatever (possibly idiosyncratic) reasons of their own and suffered a positive feedback loop of selling. His theory implies that the very end of a secular trend in growth vs value would be a crescendo of selling in some areas (that creates the "value") and buying in the other areas (momentum ones, which become very overvalued). And then after the crescendo, the trend would reverse sharply. [CBS]
• There aren't very many psychologically healthy billionaires. That's because it's hard to become one and still (a) spend time with your family, (b) avoid the risk of ruining them, (c) be loyal to friends/business partners, and (d) not reach a point of diminishing returns on wealth and want to have other pursuits. [CBS]
• Canadian oil companies just seem unbelievably cheap. I do not understand why anyone is buying cryptocurrencies or the Robinhood bubble stocks when there are cheap pipelines, oil companies, tobacco companies, and banks. Capital markets have a good $5 trillion of worthless securities and coinz bouncing around. For that price, you could buy the entire energy industry, pipeline industry, tobacco industry, and community bank sector. [CBS]
• Taking a step back, and if you remember in the middle of 2019, we began a journey of a strategic transformation. The catalyst for that journey was recognizing, the efforts to acquire new customers, primarily through an onslaught of aggressive ever increasing promotions would result in continued margin and brand erosion, which was not in the best long-term interest of our stakeholders. We immediately pulled back on many of the ineffective and unprofitable promotions and experienced a slight decrease in traffic as expected, but also improvements in our margins. Shortly, thereafter, as we all know COVID became a major factor. It impacted virtually all retailers in a variety of ways. For Sprouts, one of the most important points to understand is that in the second quarter of 2020, we lost approximately 25% of our transactions and to date they have not returned, certainly COVID played a significant role in changing the shopping patterns of our customers during the height of the pandemic. Additionally, our changing promotional approach resulted in a loss of coupon clippers. What is encouraging is that those pre-pandemic customers that make up to 75% of transactions that stuck with us are putting more units in their basket today than they did in 2019, paying higher average prices via a combination of mix, fewer promotions and inflation, resulting in record third quarter profits. Our sales in the third quarter of this year were up 5%, and our earnings per share was up 155% when compared to the same period in 2019. [Sprouts Farmers Market, Inc.]