Thursday, September 28, 2017

September 2017 Links

  • It seems that the building that uBeam use as their headquarters is going to be available for rent from January 2018. [Lies, Damn Lies, and Startup PR]
  • In China, People Turn a Blind Eye to a Hit-and-Run Victim in the Middle of the Road [YT]
  • What investors presently take as a comfortable environment of pleasant market returns and mild volatility is actually, quietly, the single most overvalued point in the history of the U.S. stock market. [Hussman]
  • “The human genome is full of potential exploits,” Sotos said, using the infosec term for a vulnerability that a hacker can leverage to take over a system. The genome is basically an open-source operating system, he said, full of security vulnerabilities. [link]
  • I intended to stop nicotine gums to which I've become horribly addicted but German elections are not the time to stop nicotine gums. [Tweet]
  • Prior to the development of widespread grain refining capability, whole grains were a decent source of magnesium (though phytic acid in grains will bind minerals such as magnesium, so the amount you eat in whole grains will generally be more than the amount you absorb). Average American intake in 1905 was 400mg daily, and only 1% of Americans had depression prior to the age of 75. In 1955, white bread (nearly devoid of magnesium) was the norm, and 6% of Americans had depression before the age of 24. In addition, eating too much calcium interferes with the absorption of magnesium, setting the stage for magnesium deficiency. [Emily Deans]
  • The thick, black-and-white rulebook packaged with every copy of the 1979 war-game The Campaign For North Africa is full of obtuse decrees, but the tabletop community always had a special appreciation for entry 52.6 - affectionately known as the “macaroni rule.” The Italian troops in World War II were outfitted with noodle rations, and in the name of historical dogma, the player responsible for the Italians is required to distribute an extra water ration to their forces, so that their pasta may be boiled. Soldiers that do not receive their “pasta point” may immediately become “disorganized,” rendering them useless in the field. It’s a fact of life really: if the Italians can’t boil their pasta, the Italians may desert. [link]
  • Huge Ethereum Mixer - 68% of total Ethereum transaction value controlled by one system [link]
  • In 2003, Fast Company published an article called The Wal-Mart You Don't Know (hat tip to Petrichor Capital). It portrayed Wal-Mart as an unstoppable predator that used its market power to squeeze its suppliers and competitors. Today Wal-Mart is seen as a has-been, while Amazon is cast as the unstoppable predator. Wal-Mart's stock was flat for many years after the article. I expect Amazon's stock to be a similar or worse disappointment going forward. [Young Money]
  • Onassis entered the shipping industry at the end of the Great Depression and became a major player after World War II. His early success was a result of two things: 1) he was able to borrow money to buy oil tankers on very favorable terms, and 2) the major oil companies were capital-constrained, so they had to offer advantageous terms when they chartered tankers. Despite these propitious circumstances, few of Onassis' rival shipowners were willing to leverage up and buy more tankers. Why not? Because they were older than Onassis and had either gone broke during the Depression or nearly gone broke, and that experience had permanently scarred them. They knew that the post-WWII market was very favorable to tanker owners, but leverage had hurt them before, so they weren't willing to use it again. [Young Money]
  • We were not diversified. We had all of our money in venture capital and internet stocks and had ridden that wave all the way up. Before Flatiron Partners (the venture firm I co-founded at the start of the Internet boom), we had no net worth. So everything we had, we made in the 1996-2000 period. And we essentially lost it all when the bubble burst. Had we not sold Yahoo! and other stocks to purchase the real estate and pay the taxes on the gains, we would have been wiped out completely. [A VC]
  • For what it's worth, when I exceed ~90 mph in my 2015 85D (typically when passing) I get a burnt toast like smell. These speed bursts last maybe 10 seconds max and the smell lingers for about 30 seconds. Consequently I'm wary of attempting a max speed run in this vehicle. [TMC]
  • Oil and Gas DPPs From Just Two Sponsors Have Caused $3.7 Billion in Losses [...] Although both sponsors charged high upfront fees, they went about it in different ways. Atlas Resource, which is an energy exploration company, contributed equipment, leases, and the upfront fee costs to the drilling programs, and claimed to not charge investors the upfront fees because the fees were paid out of the sponsor’s capital account. Ridgewood, on the other hand, contributed nothing to the drilling program and directly charged investors the upfront fees. Either way, the sponsors took the upfront fees and gave investors a 13-16% loss on the first day. [SLCG]
  • XIV is a badly designed product that will get crushed when the VIX (CBOE volatility index) spikes. It is a good short. [VIC]
  • Between the 1980s and the 2000s, the largest ever positive labour supply shock occurred, resulting from demographic trends and from the inclusion of China and eastern Europe into the World Trade Organization. This led to a shift in manufacturing to Asia, especially China; a stagnation in real wages; a collapse in the power of private sector trade unions; increasing inequality within countries, but less inequality between countries; deflationary pressures; and falling interest rates. This shock is now reversing. As the world ages, real interest rates will rise, inflation and wage growth will pick up and inequality will fall. What is the biggest challenge to our thesis? The hardest prior trend to reverse will be that of low interest rates, which have resulted in a huge and persistent debt overhang, apart from some deleveraging in advanced economy banks. Future problems may now intensify as the demographic structure worsens, growth slows, and there is little stomach for major inflation. Are we in a trap where the debt overhang enforces continuing low interest rates, and those low interest rates encourage yet more debt finance? [SSRN]
  • Watch how long a two-euro coin can balance on Fuxing train traveling at 350 kph, linking Beijing with Shanghai. [Tweet]
  • "Aluminum is like wood. It has a grain direction. Single sharp cracks with no deformation from bending is normally how 'with the grain' failures look. Against the grain usually shows significant bending before the crack becomes visible to the naked eye." [TMC]
  • Volkswagen patent application for selecting level of autonomy based on a geofence. [USPTO]
  • "Perhaps one day tech enthusiasts will be able to visit a Museum of the Future That Never Was, where the Jetsons’ hover car and the Google super-robocar will sit side-by-side as showcase exhibits." [link]
  • "A two-to-three year engineering timeline isn’t unusual; five years is considered longterm. Beyond the five-year horizon? No thanks, I’ll switch to a more spiritually and financially rewarding pursuit. We’ll leave the worthy but nebulous commitments to Carnegie Mellon and Stanford." [link]
  • As a child I associated healthcare with doctors and nurses. One trip to the most popular restaurant across from the hospital campus and Jane and I realized that it was really more about administrators, lawyers, IT, and Human Resources staffers. I’m no longer surprised to see a hospital employee badge reading “business development officer” pinned to a business suit. [Greenspun]
  • “What shocked me about my ER rotation was that the docs are paid per patient and PAs are salaried. To maximize profit, all time-consuming procedures (e.g., central lines) are done by PAs. The result is that doctors tend to see the green triage patients [the least serious cases] while the PA is working with the yellow triage group. It just didn’t make sense.” [Greenspun]
  • diseconomies of scale — they have to do more in order to grow, but as their size and functionality grow so does the cost of their overhead. Because that overhead cost is distributed across a cloud’s entire user base, each user ends up paying for complexity he or she doesn’t in fact use. [Wired]
  • [A] twenty-two-year-old Vassar graduate named Eleanor Gould, who, in 1925, bought a copy of the brand-new New Yorker, read it, and then reread it with a blue pencil in her hand. When she finished, the magazine was a mottled blue on every page - a circular embarrassment of dangling modifiers, conflicting pronouns, absent commas, and over-all grammatical hash. She mailed the marked-up copy to Harold Ross, the founding editor, and Ross was said to have bellowed. What he bellowed was "Find this bitch and hire her!" [John McPhee's new book]
  • Only seven private-equity funds larger than $1 billion have ever lost money for investors, according to investment firm Cambridge Associates LLC. Among those of any size to end in the red, losses greater than 25% or so are almost unheard of, though there are several energy-focused funds in danger of doing so, according to public pension records. [WSJ]
  • The realization that I had started to see the world through the lens of what I could request under FOIA. After I observed a man walking naked down the beach at Fire Island, I asked the National Park Service for the number of arrests they’d made for public nudity over the past five years. After Greyhound charged me $18 to book a ticket in someone else’s name, I asked the Federal Trade Commission for a list of every complaint lodged against the company for the past five years. After my subway train was stopped in the tunnel between Manhattan and Brooklyn because of an “unauthorized person walking on the tracks,” I asked the Metro Transportation Authority Police Department for its safety protocols. The information I received was never as salacious as I’d hoped, but that was beside the point. The act of requesting — and participating more fully in my country’s government — was an achievement in itself. [link]
  • Elections are now meaningless, because to the extent Republicans do anything we’d like them to do, the courts will nullify it [link]
  • Companies with a trusted brand could earn excess economic returns so long as the cost of building the brand costs less than the premium consumers were willing to pay for a product due to the brand. Because brands have historically be very durable (notice the global brands that were built in the 1950 are still dominate today), they created an economic moat that caused these companies to generate outstanding returns for shareholders. [Intrinsic]
  • When you buy an initial coin offering, you are usually buying shares, usually non voting shares, in a business with no assets and no income and no clear plan to get where they will have assets and income, as in the dot com boom. [Jim]


James said...

Thanks for the mention!

The demographics paper looks interesting, but I'm skeptical that aging will be inflationary. Retirement is a relatively recent phenomenon, traditionally most people worked their whole lives, and I think economic necessity will force many to go back to the work-till-you-die way of life.

And if the labor force does decline, we'll have a lot of real estate and other capital investments that are no longer economically necessary, which seems like it would be deflationary by pressuring asset prices and obviating further investment.

IMO the most likely outcome is that disinflationary trends continue and the risk-free rate stays low, but in practice fewer and fewer securities are risk-free as people realize that gov't debt is unsustainable.

Anonymous said...

Union Glacier is located in the southern Ellsworth Mountains of West Antarctica. This is a documentary about a small team of people who live and work on the glacier during the Antarctic summer.

Anonymous said...

Sasse grew up weeding Nebraskan soy fields as young man, making him, in more ways than one, the original “soy boy.” I’ve never met Sasse, but I’ve never seen a video or photo of him online in which he didn’t have a doe-eyed and earnest—alternately confused, na├»ve, and grateful—look on face, like a 9-year-old who’d just received a new bike from Santa Claus.

Anonymous said...

Federal jobs are not easy to get. Especially the more important ones I was doing clearance backgrounds on. But I would often see young American Jews largely with unimpressive academic backgrounds (2nd-tier or 3rd-tier schools) who had pretty extensive ties to Israel- including having lived and worked there, financial ties (Israeli bonds), etc.- landing these important gigs. It totally baffled me. Especially knowing that when picking this candidate they had to pass over a thousand gentile applicants with top-tier academic backgrounds and work experience who didn’t have any foreign involvement red flags.

Anonymous said...

Labor is valueless in Mexico because in Mexico, corruption and the threat of confiscation of capital mean no one will invest there, or if they will they will demand a very high rate of return so as to pay off the investment before it is stolen or confiscated.

CP said...

The mean age of death for tattooed persons was 39 years, compared with 53 years for nontattooed persons (P = .0001). There was a significant contribution of negative messages in tattoos associated with nonnatural death (P = .0088) but not with natural death. However, the presence of any tattoo was more significant than the content of the tattoo.

Persons with tattoos appear to die earlier than those without. There may be an epiphenomenon between having tattoos and risk-taking behavior such as drug or alcohol use. A negative tattoo may suggest a predisposition to violent death but is eclipsed by the presence of any tattoo.