Sunday, March 31, 2024

Books - Q1 2024

  • The Past is a Future Country: The Coming Conservative Demographic Revolution (4/5) See full Tom File review. Most important takeaway from book: "One way to look at the Sexual Revolution is as a powerful poison designed to eradicate human beings like bacteria in a petri dish by interrupting their natural reproductive ecology. Like an antibiotic, if the dose is insufficient to uniformly kill the entire population, any surviving members become resistant. Dutton then simply identifies the two populations who have successfully resisted the poison: highly religious, intentionally fertile families who reject the Sexual Revolution explicitly, and those who lack the self-control or conscientiousness to make use of its technologies to prevent unintentional pregnancies." Of the Big Five personality factors (which are heritable), he thinks that agreeableness is being selected for and neuroticism is being selected against, and points out that religious people (except converts!) are agreeable and low in neuroticism. Something else useful is that Dutton gives a good discussion of the moral foundations framework. Liberals are high in individualizing foundations and low in group-binding foundations. "As a result, [liberals] will tend to hijack the culture and push it leftwards, because conservatives can empathize with liberals while liberals cannot empathize with conservatives." Big point: "among those who have relatively high intelligence, religiousness and conservatism are crucial predictors of fertility... conservatism 'protects' IQ - it protects a large female brain from sterilizing her womb with leftist ideology."  Predicts that the world is going to have an over-population crisis of the vert stupid and very antisocial, and that the smart fraction will escape to civilizational bastions during a winter of civilization. (Is this why Musk wants to go to Mars? Another option might be to escape to El Salvador?) He doesn't think that what we are experiencing now is the result of anyone's 100 year plan. "Dogmatic conspiracy theorists tend to be of low socio-economic status, giving them a sense of powerlessness which is assuaged by the feeling that they have some gnosis about the nature of the world." "We would expect people, due to decreasing intelligence (and thus decreasing logical abilities) and increasing schizophrenia (due to higher mutational load) to be arguing that there was a Satanic elite that was going to succeed in enslaving us all." Points out something that I think explains Richard Spencer: "a portion of those on the 'far right' today may simply be contrarians... Being 'alt-right' is predicted, in part, by psychopathic personality traits, an element of which involves being attracted to and enjoying danger and simply taking pleasure in upsetting people." He says the biggest single predictor of supporting very left wing policy is "malicious envy".
  • Simplicity Parenting: Using the Extraordinary Power of Less to Raise Calmer, Happier, and More Secure Kids (3/5) Without realizing it, this author actually gives a very similar message as Bryan Caplan in Selfish Reasons to Have More Kids (see CBS note). He is a Waldorf educator and one of the funny issues that he confronts is leftist parents who make their kids (and themselves) anxious and unhappy with things like CNN/MSNBC propaganda and climate alarmism. The type of people who say they are "raising a citizen of the world." This book builds on the previous Dutton book in a funny way because that is the perfect example of a neurotic leftist behavior that is being selected against and will go extinct. He discusses four levels (really, areas) of simplification of family life: the environment, rhythm, schedules, and filtering out the adult world. Regarding toys, he asks, "is this a toy my child can pour their imagination into, or is it too 'fixed'?" It is a bit alarming to see what has happened with LEGO toys but it is still possible to just buy the blocks and leave room for creativity. Here's agreement with Simon Sarris: "Children love to be busy, and useful... A wonderful counterbalance to 'entertaining' children is to involve them in a task, in the 'work' of family life." "Infants thrive on closeness; they're most soothed and happy in some form of warm embrace. Toddlers want to play - even if they're playing alone - where they can see and be near others. You've noticed their preference for right under your feet. Sometimes rooms in the house need to be shifted for the early childhood years, so that a play space is made near the kitchen or the heart of the house." "Children who've had a role in preparing a meal assume ownership of it." "Schedules can be simplified tremendously just by emphasizing free play over organized sports..." Naturally he's not a fan of screens (see Tom File on screens), but suggest that it applies to the parents as well. "Everyone is distracted when one member of the family is distracted. Even if the kids don't have their own cellphones, they understand when they have someone's attention and when they don't." (Waldorf is very strong on smartphones.)
  • Wind Energy Comes of Age (3/5) This was written in 1995 by wind energy advocate Paul Gipe to make the argument that wind power was ready for prime time. It has some good sections on the physics of wind and especially some of the physics based tradeoffs that go into designing a wind farm and picking the right turbines to use. Gipe thought that medium sized (e.g. half-megawatt) turbines were going to win out. There was a physics-based argument for this: the square-cube tradeoff. The energy captured by the rotor (blades) is proportional to the square of the length (since it's based on area), but the volume of the blades and other parts (like the turbine) are proportional to the cube. So the cost of the blades, turbine, and tower increases faster than the value of the energy produced as the blade length and rotor area gets longer. What has ended up happening, though, is that manufacturers have gotten better at building the different parts and systems (learning curves), and so the optimal blade length and rotor area has trended up. So a 40 meter modern blade might weigh the same about as a 30 meter older blade, which allows the optimal size rotor area and turbine to be bigger. This is another instance of the tension between physics-based pessimism about natural resources and economics-based optimism (cornucopianism). Speaking of wind energy, there is an Oddball Stock called Aztec Land & Cattle Co., Ltd. (AZLCZ) that owns about a quarter-million acres in northern Arizona. There is going to be at least one wind farm on their property, starting with a 500 MW project that is being built by AES called the West Camp Wind Farm. The turbines are going to be Vestas V150 (each 4.5 megawatt) which have 74 meter long blades. The area of the circle swept by them is 190,000 square feet -- 4.4 acres! So in some ways, Gipe underestimated the progress that wind energy was going to make. These turbines are an order of magnitude larger than what he thought would be optimal. On the other hand, you still don't see wind power happening without subsidies. The production tax credit of 2.6 cents/kWh was recently extended. There are also manufacturing tax credits for U.S. manufactured wind energy components such as blades, nacelles, and towers. As the landowner, Aztec will get a royalty on the electricity sold by the WCWF, so it is agnostic about the ultimate economics (subsidized or unsubsidized) of the project. (In fact, if renewable energy boondoggles cause the wholesale price of electricity to rise it will benefit Aztec.)
  • From Bauhaus To Our House (5/5) There's a theory that Tom Wolfe is one of the writers (perhaps, THE writer) of our simulation. How else could he have been so prescient and why else would our universe now be striving for the most ironic outcomes? Wolfe does not say this explicitly, but modern architecture (e.g. Walter Gropius and his Bauhaus school in Weimar) was Marxist. The goal of this architecture was to be "nonbourgeois," which like everything else in Marxism was an attack on normal people. Also, and again this is a consistent theme of Marxism and communism, the buildings didn't work. Example: "It had been decided, in the battle of the theories, that pitched roofs and cornices represented the 'crowns' of the old nobility, which the bourgeoisie spent most of its time imitating. Therefore, henceforth, there would be only flat roofs; flat roofs making clean right angles with the building facades. No cornices. No overhanging eaves. These young architects were working and building in cities like Berlin, Weimar, Rotterdam, Amsterdam, at about the Fifty-second Parallel... At this swath of the globe, with enough snow and rain to stop an army, as history has shown more than once, there was no such thing as a functional flat roof and a functional facade with no overhang. In fact, it is difficult to imagine where such a building might be considered functional outside of the Painted Desert. Nevertheless, there was no turning back from the flat roof and the sheer facade. It had become the very symbol of non-bourgeois architecture. No eaves; so that very quickly one of the hallmarks of compound work, never referred to in the manifestos, became the permanently streaked and stained white beige or stucco exterior wall." Also: "The brutal fact of life was that it was difficult for [modernist] architects to get work unless there was a government - usually socialist - that had decided, in effect: We need a new look around here, and you fellows have one." So, ugly architecture is not the free market outcome in many cases! The further capital is from having a responsible owner, the more likely it is to build hideous modernist structures. Is Bauhaus where minimalism came from?: "They had open floor plans, ending the old individualistic, bourgeois obsession with privacy. There was no wallpaper, no drapes... no more 'luxurious' rugs and carpets. Gray or black linoleum was the ticket." So minimalism is an expression of Communist poverty, and the observation flooring reminds us of the current, bleak, grey "luxury" vinyl flooring that pervades all new home construction and renovations now.
  • What I Learned About Investing from Darwin (3/5) Thought this would be interesting since I have been interested in the intersection of evolutionary theory and investing, but it was underwhelming. A few things that stuck with me - not saying I agree with them unequivocally but food for thought. "Not having high leverage probably makes sense to everyone. But the following may not: I am an advocate of no leverage. More than 90 percent of our portfolio companies have - and have always had - excess cash." He points out that a few years ago we had a bubble in electric vehicle startups, counting seven new companies that IPOd. "I don't know if the IPOs of these companies increased the interest level in the search term or whether the increased searches of 'electric vehicles' were a leading indicator of public listings. Maybe they just fed each other in a positive feedback loop. Whatever the case may be, as you can see, there is a strong correlation between the theme of electric vehicles and the IPOs..." Discussion of reasons for fund manager under-performance - he thinks a big reason is low active share. Important quote from Darwin that's worth repeating: "Every being, which during its natural lifetime produces several eggs or seeds, must suffer destruction during some period of its life, and during some season or occasional year; otherwise, on the principle of geometric increase, its numbers would quickly become so inordinately great that no country could support the product. Hence, as more individuals are produced than can survive, there must in every case be a struggle for existence. Either one individual with another of the same species, or with the individuals of distinct species, or with the physical conditions of life." His investment approach is to search for companies with high return on capital employed (ROCE). So - even though he doesn't mention this - he is betting against mean reversion. His basic view: "[G]reat businesses maintained their greatness over a very long period. Stasis was the default for them. Once we own such a business, selling would border on being sinful."
  • Birdseye: The Adventures of a Curious Man (3/5) This is by Mark Kurlansky, a prolific author of such books as Salt and Cod. Birdseye invented a good process for freezing food and then sold his company to Marjorie Merriweather Post, who had inherited her father's Postum Cereal Company. (She spent $7 million in the mid-1920s building Mar-a-Lago in Palm Beach.) Kurlansky says that he says he decided to write about Birdseye because he turned up in his Salt and Cod books as well as his history of Gloucester. Key point: "Birdseye greatly contributed to the development of industrial-scale agriculture. He even worked with farmers to make their products more suitable for industry. But unlike people today who have grown distrustful of big business, for Birdseye, a product of the zenith of the Industrial Revolution, 'industry' was always a good word, without negative connotations. Today's locavore movement - the movement to shun food from afar and eat what is produced locally - would have perplexed him. Why, Birdseye would have wondered, would you want to be limited by local production when the food of the world is available." "It would have made little sense to Birdseye to prefer small artisanal farms with low and inconsistent yields to the miracles of agribusiness." Another Birdseye concept - he "developed a pet theory that the subconscious resembled an electronic calculating machine. 'If you feed the right information into it, it will quietly go to work in mysterious ways of its own and, by-and-by, produce the answer to your problem.'"
  • The Coming Boom: Economic, Political and Social (3/5) Edward Dutton (author of The Past is a Future Country, above) does not believe what we are experiencing now is the result of anyone's 100 year plan. But there is some kind of permanent deep state, and we know some of the people who helped to form its ideas in the past. An example is Herman Kahn, a futurist who worked for the RAND Corporation and helped formulate the strategy of nuclear deterrence. He wrote this book predicting a boom in 1982, which was early in Ronald Reagan's first term and absolutely prescient timing to predict a boom. The yield on the ten year treasury had just hit its all time high of 15.8% in September 1981, and 1982 was the beginning of a generational bull market in stocks and bonds that has lasted for more than 40 years. This paragraph gives a good sense of how Kahn thought: "At present, almost all schools in the advanced capitalist nations teach that the world is running out of resources, that our grandchildren will not live as well as we do because of the reckless use of nonrenewable resources for frivolous purposes, that the environment is being polluted beyond repair and the ecology being destroyed, and that industry is increasingly producing products that give consumers and workers cancer. All of the above are either completely or largely false. One might well ask what kind of a price these countries will have to pay for teaching this kind of insidious and invidious nonsense to the younger generation." Kahn is thus really interesting because he was a physicist but his beliefs were economist-cornucopian. He thought that problems that were less than existential could likely be solved through ingenuity or substitution, and the real meta-problems were pessimism and attitudes of anti-prosperity. In the same way that the election of Reagan sparked a boom by changing the attitude from Democrat malaise (Democrat presidents from 1933 until 1981 interrupted only by Eisenhower and Nixon/Ford, and Nixon had a Democrat congress his entire presidency), if Trump is put back in office we could experience another boom.

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