Another Hitch-Slap Dished Out. . .

Christopher Hitchens on Louis Farrakhan & The Pope. Clip from the Afterlife Debate with Rabbi Shmuley Boteach, September 16, 2010, New York:

Vaclav Smil Interview

The WFP recently interviewed scientist, environmentalist and author Vaclav Smil about globalisation and energy consumption. Smil is a prolific author and can count Buffet and Gates as two of his many admirers.

Taken from the interview:

Q: Do you call yourself an environmentalist?

A: Of course, but the first qualification for such a label should be an extensive quantitative understanding of nature. Without it, everything dissolves into emotional qualitative claims that may, or may not, have any real merit.

The same view could surely be applied to so many other things that the population opines and votes on - the first qualification being an extensive quantitative understanding of the facts. 

Hard Talk

I seemed to have missed this one - the inimitable Hugh Hendry on BBC's Hard Talk about a month ago:

How Big ?

Ripped straight from Tim Iacono's blog (graphic via the Big Think blog). Looking at this it makes it easy to understand one of the reasons why Stephen Jennings has bet so much of RenCap on Africa:

. . . . After having looked at the same flat maps as you’ve probably looked at for many, many years, it came as a surprise to me that land masses around the equator are actually much bigger than is commonly believed, the image below. . . proving that point quite clearly.

Of course, the corollary is Greenland, an island nation that, though quite large, is not nearly as big as most people believe. Then again, most people probably don’t even know where or what Greenland is, let alone wonder whether their perception of its size has been distorted by looking at flat maps of a sphere for so many years:

Mid-Week Tunes

Silversun Pickups - Little Lover's So Polite

Brand New - The Quiet Things No One Ever Knows

Through Moscow on an R1

The fastest way through Moscow traffic. . . on an R1:

The Renaming Of The United States

Source and larger size.

Richard Dawkins on Real Time

Bill Maher interviewed Richard Dawkins on his show a few days ago. HBO gets upset about copyright and keeps forcing these clips to get pulled. So here are two different sources of the same thing in case one gets pulled in the future.

The first source below is the whole show. Other guests include Andrew Ross Sorkin and PJ O'Rourke - so the whole show is worth a watch. But Dawkins is the first guest - so skip ahead to 7:15 if you only want to see him. And the show gets pretty funny again from 44:55:



And if the vid for the whole show above gets yanked, you can see just the Dawkins interview segment here.

How Fake Money Saved Brazil

How fake money saved Brazil - An interesting piece on NPR describing how Brazil changed its currency to solve its inflation problem.

I bet most people have no idea of the story of the real. A great story about four drinking friends who changed Brazil's economy and got it on the high-octane path it now finds itself on.

It essentially shows how money (fiat currency) is a psychological concept - perception can become reality.

Have a listen.

Housekeeping

For anyone who's interested, I've just cleaned up my blog roll - there's a bunch that I've trashed, as I don't read them anymore. And a few additions too. So the links there largely follow what ends up in my aggregator.

Blog roll still where it's always been, entitled "Who I Read", towards the bottom right on the blog home page.

Bill Maher interviews Richard Tillman

For those of you who don't know the Tillman story - here's the intro from Wikipedia:

Patrick Daniel "Pat" Tillman (November 6, 1976 – April 22, 2004) was an American football player who left his professional sports career and enlisted in the United States Army in June 2002, in the aftermath of the September 11, 2001, attacks. He joined the United States Army Rangers and served multiple tours in combat before he died in the mountains of Afghanistan. Initially, the U.S. government attempted a cover-up, reporting that Tillman had been killed by enemy fire, with Lt. Gen. Stanley McChrystal approving a Silver Star citation. Later, his actual cause of death by friendly fire was recognized.

A New York Times book review of Jon Krakauer's Where Men Win Glory: The Odyssey of Pat Tillman noted that the book did well to compile the facts and "nauseating" details regarding the cover-up of Tillman's death, stating "After Tillman’s death, Army commanders, aided and abetted by members of the Bush administration, violated many of their own rules, not to mention elementary standards of decency, to turn the killing into a propaganda coup for the American side."

So Bill Maher interviewed Pat's brother Richard last month on his show. The whole thing is worth a watch, but for those in a rush it gets good between 4:30 and 7:05:

Power From The Earth ?

From Tea With The Economist:

Power from the earth: The largest generator. There is enough heat stored just below the earth's surface to potentially meet the world's energy needs. But can we tap it?

Tea With The Economist: Sidney Rittenberg

Mao's interpreter on the evolution of individual ambition, China's development, and why Mao was the best listener he ever met. . . 

Visa Restrictions

From The Economist:

THE ability to visit a foreign country without the cost and hassle of obtaining a visa is a welcome bonus for any traveller. It is also a barometer of a country's international alliances and relations. A report released on August 25th by Henley & Partners, a consultancy, shows that Britons have the fewest visa restrictions of the 190-odd countries (and territories) for which data are available. British citizens can enjoy a three-day stay for business or pleasure to 166 destinations without needing a visa.

Not included in the chart below are New Zealand and Australia, which are both ranked 9th = with Canada.

Economist source here. Henley & Partners Visa Restrictions Index Global Ranking 2010 source here. 

Cardinal Sinister

Cardinal Sinister by Nick Walker

Diversions. . .

• The world's water shortage is becoming less of a forecast and more of a reality - especially in China. CNN reports on just how bad things have got. Perhaps one day water will be more valuable than oil - and countries like New Zealand, Canada, Peru and Russia with their low population to water reserve ratios will become the new petro-states;

• Salon has an excellent interview with Richard Dawkins as he prepares to tour the USA to promote his latest book. Here's a sample from the heated phone interview:

What is so bad about religion?

Well, it encourages you to believe falsehoods, to be satisfied with inadequate explanations which really aren't explanations at all. And this is particularly bad because the real explanations, the scientific explanations, are so beautiful and so elegant. Plenty of people never get exposed to the beauties of the scientific explanation for the world and for life. And that's very sad. But it's even sadder if they are actively discouraged from understanding by a systematic attempt in the opposite direction, which is what many religions actually are. But that's only the first of my many reasons for being hostile to religion.

My sense is that you don't just think religion is dishonest. There's something evil about it as well.

Well, yes. I think there's something very evil about faith, where faith means believing in something in the absence of evidence, and actually taking pride in believing in something in the absence of evidence. And the reason that's dangerous is that it justifies essentially anything. If you're taught in your holy book or by your priest that blasphemers should die or apostates should die -- anybody who once believed in the religion and no longer does needs to be killed -- that clearly is evil. And people don't have to justify it because it's their faith. They don't have to say, "Well, here's a very good reason for this." All they need to say is, "That's what my faith says." And we're all expected to back off and respect that. Whether or not we're actually faithful ourselves, we've been brought up to respect faith and to regard it as something that should not be challenged. And that can have extremely evil consequences. The consequences it's had historically -- the Crusades, the Inquisition, right up to the present time where you have suicide bombers and people flying planes into skyscrapers in New York -- all in the name of faith.

• Hugh Hendry and Linda Yueh discuss the importance of potash and how demand for the stuff is changing and how geo-politics are playing a part:

• A veganism advocate recants: Pinko-Greenie George Monbiot has an excellent article in The Guardian discussing Simon Fairlie's recently published Meat: A Benign Extravagance. He talks of the gross inefficiencies of intensive, confined farming of some animals, and that rearing animals for meat can become an efficient means of food production when the animals are pasture reared. He argues that increasing global meat consumption is sustainable, but not using the current farming model. The often cited 10:1 ratio of how much grain it takes to produce an equivalent weight of meat is more like 2:1 or even less, once the farming model is adjusted. He also debunks the argument that farming is killing water reserves to the extent it is and the high levels of greenhouse gases animals produce. The evidence has curious implications for low-cost meat and dairy producers like New Zealand, where ruminant farm animals largely eat pasture. Such low-cost production has been an enduring competitive advantage. But with Fairlie arguing that much of carbon generation from meat farming being generated further down the value chain in transportation, perhaps New Zealand's low-cost production advantage will whittle away once negative externalities like carbon generated from transportation are properly accounted for. I mentioned such a threat to New Zealand and its industries back in January in a post about Jeff Rubin. Well worth a read;

• Farm Geek has an interesting post on Peak Phosphate and whether New Zealand should get all protectionist about its phosphate supplies. Governments act in strange ways once a resource is labelled a "strategic resource";

• Wall Street and hedge funds using satellite surveillance to gather market-moving information? Yes, really;

• Paul Kedrosky on TechCrunch in a series of mini interviews talking about how we're now in a depression, the death of big VC, how airlines suck, and clean tech;

• Back on August 29 a guy disappeared off the beach in the Bahamas where parts of Jaws were shot. On September 4, a local investment banker caught a 4m shark near the same spot. When it was being landed, who popped out but parts of the guy that went missing the week before. Check it out;

• A great article from the New York Review of Books on how things are now in Dubai and how things have changed. Here's a paragraph:

During the past few months, I was told, Sheikh Mohammed has been trying to confront his dream’s collapse. He has said little publicly about the economic meltdown, other than issuing a handful of sunny pronouncements about Dubai. “Sheikh Mo is an angry man,” I was told by a source who knows him well; he feels “betrayed” by the real estate promoters who had assured him to the end that their ventures were healthy. According to my source, the sheikh has been taking long solo drives in his Mercedes at night, stopping in front of construction sites, and gazing pensively at the many vacant and half-built skyscrapers. Mohammed recently completed his autobiography for a US publisher with the assistance of a ghostwriter, but, a source in publishing said, he had refused to add a chapter about the bursting of the real estate bubble, the debt crisis, and the bailout by Abu Dhabi. He saw no reason to discuss these sources of humiliation. As a result, I was told, the book will never see the light of day.

• Ruth Richardson, former Finance Minister of New Zealand, was recently on CNBC arguing for a bit of Austrian Ruthanasia for near bankrupt Western states:

• And finally, from Wired: Why Russians Don't Get Depressed.

Not What The Religulous Want To See. . .

These graphs were taken from the OK Trends blog, which is authored by a couple of statisticians from OK Cupid. The sample data driving the graphs below was taken from 526,000 OK Cupid profiles with user self-stated race, and then analysed using the Coleman-Liau Index to analyse the profile text. This is what they found:

. . . . And in case you never made it to the cinema to see it, here is Bill Maher's most excellent Religulous in its entirety:

Friday Tunes

Here's one from the past. . .

Juliana Hatfield - What A Life






Santigold - Lights Out

John Key @ 25 ?

Here's a short documentary on the life of a FX trader in NZ in the 80s - and the focus is on John Key at 25, decades before he became Prime Minister of NZ. . . check out the glasses !

Monday Tune

Santigold - L.E.S. Artistes

No Exit

World Population by Latitude/Longitude

Taken from Bill Ranklin via Infectious Greed. For those NZers amongst you, note the little spike in the bottom right hand corner of the Longitude graphic:

The Wrong Stuff. . .

Paul Kedrosky (of Infectious Greed fame) this week interviewed Kathryn Schulz (of The Wrong Stuff) as part of his Infectious Talk series over at the Kauffman Foundation:

In this episode, Paul talks with journalist and author Kathryn Schulz. They discussed Schulz's recently released book, "Being Wrong: Adventures in the Margin of Error." They talked about Schulz's premise that we're all wrong, all the time, and how the inability of politicians and business leaders to admit to mistakes can be devastating. On the other hand, the ability to learn from our mistakes can have personal benefits.


Interview here. 

George Friedman Interview

John Thomas, The Mad Hedge Fund Trader, interviewed George Friedman of STRATFOR earlier this month. Whilst Thomas' site's name and his interview intro's are a little schmaltzy, he has a fairly impressive background.

The interview touches on Russia, Iran/ the Middle East, oil, Poland, Turkey, China and Japan among other things. All in a geo-political/ investment context. Friedman gives some pretty contrarian views in the second half of the interview - for example, he's long Japan. Seriously.

It's 40 mins long and a must listen. Interview here.

Taken In Red Square This Morning. . .

This photo was taken and emailed to me this morning with the following note. Be glad you're not near this:

It's plus 41 in Moscow (all-time-high), zero visibility due to smoke from forest fires (see photo below). It literally feels like we are all sitting in a smoke-lounge of an airport. Anyone in the right mind (and with some money) is getting out of here – good for Aeroflot?


I have not had a drink in a week...have a hang-over every morning regardless. Short vodka/beer makers, Long Pharmstandard?


Give us some business so we don't feel like sitting here for no reason...

And for those of you that haven't seen it - this vid was shot from a car inside the fire zone several days ago:



HT - MGJ

Friday Tunes

Caviar - Tangerine Speedo

Rufio - Science Fiction

Early Week Tune

Silversun Pickups - Kissing Families

Beware the US Census Caller !

Copy and pasted straight from David Cowan's Who Has Time For This?

THURSDAY, JULY 01, 2010

Phone Call from The Census

The US Census office in New York has had to fire workers due to fraud. The new folks there must still be learning the ropes. This actual telephone call to my friend Erik Gordon was transcribed immediately upon hanging up, so it's practically verbatim...

Ring. Ring.

ERIK: "Hello?"

CHARLOTTE: "Hello.  This is Charlotte calling from the 2010 United States Census.  We've left you a couple of messages over the past few weeks but you haven't returned our calls.  I'm calling to ask you some additional questions about the census form that you recently completed.  This should take only a few minutes."

ERIK: "Okay."

CHARLOTTE: "Can I start by verifying your address?"

ERIK: "Yes, it's the one you have on the form -- 68 East 78th Street in New York."

CHARLOTTE: "And is this the Gordon household?"

ERIK: "Yes."

CHARLOTTE: "And who completed the census form on behalf of the household?"

ERIK: "I did. I'm the only one who lives here."

CHARLOTTE: "And what is your name?"

ERIK: "Erik Gordon. Don't you have that on the form I filled out?"

CHARLOTTE: "Yes."

ERIK: "So why are you asking me again?"

CHARLOTTE (reading): "We need to make sure that the 2010 US Census is an accurate count of every person in the United States and that no person is double counted.  This should take only a few minutes."

ERIK: "Okay."

CHARLOTTE: "So Erik Gordon filled out the census form on behalf of your household?"

ERIK: "Yes, I did."

CHARLOTTE: "And am I speaking to Erik Gordon?"

ERIK: "Um, yes.  But I think we've covered this, no?"

CHARLOTTE: "Yes, but I need to ask the questions in the order they appear on my screen."

ERIK: "Okay."

CHARLOTTE: "Mr. Gordon, how many people were living at your address on April 1, 2010?"

ERIK: "Just me.  I'm the only one who lives here."

CHARLOTTE: "So should I put 'One?'"

ERIK: "Probably."

CHARLOTTE: "Mr. Gordon, do you have children, babies or foster children living with you?"

ERIK (louder): "I'm the only one here."

CHARLOTTE: "It's a yes or no question, Mr. Gordon."

ERIK: "If I'm the only one here, then the answer is 'No,' right?"

CHARLOTTE: "Okay, I'm going to put 'No.'"

ERIK: "Good idea."

CHARLOTTE: "Mr. Gordon, do you have any other relatives living with you?"

ERIK: "I'm the only one here."

CHARLOTTE: "I can't put that."

ERIK: "I don't care."

CHARLOTTE: "Mr. Gordon, we need to make sure that the 2010 US Census is an accurate count of every person in the United States and that no person is double counted.  This should take only a few minutes."

ERIK: "But all of this is on the form I filled out."

CHARLOTTE: "I know.  I have it here."

ERIK: "So why are you asking me the same questions?"

CHARLOTTE: "Mr. Gordon, this should take only a few minutes."

ERIK: "This should take no minutes."

CHARLOTTE: "Mr. Gordon, are you refusing to answer the questions?  Because if you're refusing to answer the questions, I'm going to have to call you back."

ERIK: "I'm not refusing to answer the questions, Charlotte.  I already answered them."

CHARLOTTE: "When?"

ERIK: "On the form you have in front of you."

CHARLOTTE: "Oh."

ERIK: "Yes."

CHARLOTTE: "Mr. Gordon, this should only take a few minutes.  Can I ask if you have any nonrelatives, such as roommates or babysitters living with you?"

ERIK: "I'm the only one here."

CHARLOTTE: "Mr. Gordon, you know I can't put that."

ERIK: "No, Charlotte, no. I don't have anyone else living here!"

CHARLOTTE: "No roomates or babysitters?"

ERIK: "No!"

CHARLOTTE: "I'm going to put 'No.'  Mr. Gordon, do you have anyone living with you temporarily?"

ERIK: "Charlotte, you know what I'm going to say, right?"

CHARLOTTE: "Mr. Gordon, it's a yes or no question."

ERIK: "Charlotte, you've already asked me about relatives and nonrelatives.  Who else could be living with me?"

CHARLOTTE: "Anyone living with you temporarily, such as any illegal aliens."

ERIK: "Yes, Charlotte.  I forgot.  I do have illegal aliens living with me."

CHARLOTTE: "How many?"

ERIK: "I live with approximately twelve thousand illegal Mexican immigrants.  But please don't put that down, I don't want to get in trouble."

CHARLOTTE: "Mr. Gordon, I have to put it down."

ERIK: "Please don't put it down.  They're nice people.  They’ve traveled far."

CHARLOTTE: "I'm sorry, Mr. Gordon.  I have to put it down."

ERIK: "Okay, put it down."

CHARLOTTE: "Okay."

ERIK: "Charlotte, did you really just put down that I live with 12,000 illegal Mexican immigrants?"

CHARLOTTE: "No.  I just put twelve."

ERIK: "Why?"

CHARLOTTE: "I don't have enough room."

ERIK: "Okay."

CHARLOTTE: "Mr. Gordon, were you away from this address anytime in March or April of 2010?"

ERIK: "What do you mean?"

CHARLOTTE: "What do *you* mean?"

ERIK: "Are you asking me if I left my apartment anytime in March or April?"

CHARLOTTE: "Yes."

ERIK: "Then 'Yes.'"

CHARLOTTE: "Mr. Gordon, where did you go?"

ERIK: "Charlotte, I went a lot of places."

CHARLOTTE: "I only have one line."

ERIK: "That's too bad, Charlotte, because I went *a lot* of places."

CHARLOTTE: "But I only have one line."

ERIK: "So what do you want me to tell you?"

CHARLOTTE: "I don't know.  Do you want me to ask my supervisor?"

ERIK: "Actually, I think you should ask your supervisor."

CHARLOTTE (returning to the phone after putting me on hold for two or three minutes): "I think we should just put 'Don't Know.'"

ERIK: "Fine."

CHARLOTTE: "Mr. Gordon, in March and April of 2010 where did you spend most of your time: at your address in New York or in Don't Know?"

ERIK: "New York.  Don't Know isn't a real place."

CHARLOTTE: "Okay.  New York.  Is there any other place you spent most of your time?"

ERIK: "Charlotte, what does that mean?"

CHARLOTTE: "You said you spent most of your time in New York.  Is there any other place where you spent most of your time?"

ERIK: "Charlotte, how can I spend most of my time in more than one place?"

CHARLOTTE (after thinking it over): "I think we should put 'Don't Know.'"

ERIK: "Okay.  Let's put that."

CHARLOTTE: "Okay."

ERIK: "Okay."

CHARLOTTE: "Mr. Gordon, other than New York and Don't Know, did you spend any time anywhere else?"

ERIK: "Pardon?"

CHARLOTTE: "Other than New York and Don't Know, did you spend any time anywhere else?"

ERIK: "Other than New York and Don't Know?"

CHARLOTTE: "Yes."

ERIK: "No.  I spent all of my time in New York and Don't Know."

CHARLOTTE: "How about prison?"

ERIK: "How about prison?"

CHARLOTTE: "Did you spend any time in prison in March or April of 2010?"

ERIK: "No, I was only in New York and Don't Know."

CHARLOTTE: "Okay."

ERIK: "Okay."

CHARLOTTE: "Okay.  Mr. Gordon, did you spend any time in the military?"

ERIK: "No."

CHARLOTTE: "Mr. Gordon, did you spend any time in a nursing home?"

ERIK: "Charlotte, can we just put 'Don't Know' for the rest of the questions so we can both get on with our lives?"

CHARLOTTE: "No, I can't do that.  You need to answer every question.  This should take only a few minutes."

ERIK: "It’s already been more than a few minutes."

CHARLOTTE: "Mr. Gordon, are you refusing to answer the questions? Because if you're refusing to answer the questions--"

ERIK: "I don't want you to call me back Charlotte.  I did not spend any time in a nursing home in March or April of 2010.  I was too busy in Don't Know."

CHARLOTTE: "What?"

ERIK: "No.  No time in a nursing home."

CHARLOTTE: "Mr. Gordon, that was the last question.  On behalf of the 2010 United States Census, thank you and have a good evening."

Late Saturday Night Tune

VAST - Pretty When You Cry

I Know Where You Live

100% ripped from Jessica Hagy's Indexed:

 

Liquid Liquid

Heard this track by Guru this morning:

Guru - Cave In

Which sampled Liquid Liquid's efforts from 1983 nicely:

Liquid Liquid - Cavern

Milken: To China or Not to China ?

I've watched a few more Milken panels since the last post below, but this one on investing in China is a cracker!

I was going to post an article that was published in Advisor Intelligence: China Roundtable with Robert Horrocks and Vitaliy Katsenelson. A good article that has a well-known and knowledgeable China bear (Katsenelson) arguing the merits of China investment with his bullish counterparty, Horrocks.

But, this Milken panel on China investment is far more in depth and a must watch for any emerging markets investor. Most importantly it's entertaining - a star panel, where things kick right off and get pretty heated. Long, but well worth it. Have a watch here.

Milken: Commodities Overview and Outlook

So, keeping with the theme of me catching up with my reading, here's some footage I'm unashamedly scalping from Paul Kedrosky's Infectious Greed. It's 73mins of viewing from last month's Milken Institute conference about commodities (both hard & soft). There's a senior guy from Rabo that Chairs a panel discussion. All the participants are serious commodities players. A must watch. I can't embed it - so take a look here.

Quants: The Alchemists of Wall Street

I've had a busy few weeks - hence the lack of posts. Posting is likely to be intermittent for the next while. . .

Meanwhile. . . Another good doco/ interview from VPRO Backlight. All about quants, the role they play, and their part in the GFC. Good viewing:

Late Monday Tunes. . .

Neil Young - Old Man

. . . And for some reason this reminded me of Alice In Chains' Rooster

The Cure and Korn, unplugged, live mash up - Make Me Bad & Inbetween Days

Alice In Chains - Rooster

The Oldest Trick in the World. . . .

Monday Tunes

William Shatner and Joe Jackson - Common People

Idlewild - A Modern Way of Letting Go

Friday Tunes

Matt Costa - Sunshine

And here's another. . . because it's Friday

The Offspring - Self Esteem

To Pay or Not To Pay ?

Some very good points made over at Shirky's blog about consumer (non)payment of media. Will be interesting how the battle between the to pay and not to pay camps (Godin vs. Murdoch) plays out. Maybe even Freemium will prevail?

Worth a read, here. Here's a taste:

Bureaucracies temporarily suspend the Second Law of Thermodynamics. In a bureaucracy, it’s easier to make a process more complex than to make it simpler, and easier to create a new burden than kill an old one. . .

When ecosystems change and inflexible institutions collapse, their members disperse, abandoning old beliefs, trying new things, making their living in different ways than they used to. It’s easy to see the ways in which collapse to simplicity wrecks the glories of old. But there is one compensating advantage for the people who escape the old system: when the ecosystem stops rewarding complexity, it is the people who figure out how to work simply in the present, rather than the people who mastered the complexities of the past, who get to say what happens in the future.

This ties in nicely with the ongoing debate about the tabehoodai (all-you-can-eat) media plans raging over the web. Looks like supply-side sentiment is crystallising into action with the tariff shifts against the consumer.

Living in the End Times

Now who said being nuts and being intelligent were mutually exclusive? Here's a fascinating vid of well-known Slovenian philosopher Slavoj Zizek giving his $0.05 worth on a bunch of different current global circumstances. Now clearly this guy's more than a bit of a raving lefty, but interesting nonetheless. Moreover, the structure of the 'interview' is pretty cool. Curious how such a pinko has praise for the benevolent dictatorship of Singapore and their particular flavour of capitalism. I'm sure that communism is largely retired to the trash heap (where it belongs), but the new wave of British 'Red Tories' might turn out to have some staying power as pointed out in this Prospect Magazine article [HT MGJ].

NB: I found the second 'story' of the girl and her family bank and how the market were tripping over themselves to buy the bank and the quality assets on its balance sheet particularly interesting - I'm working on a mandate for a new EU bank desperate to buy prime conforming mortgage books (not RMBS or CMBS). This market is unbelievably hot with every first and second tier credit institution falling over themselves to buy this stuff and shore up their balance sheets, or at worst, hold on to the stuff they've got already. Then you've got the lawyers trying to sell you advice on forward-flow and innovative origination structures. . . The days of these banks taking a haircut on selling prime assets are well and truly over - if you want to play, you pay par.

Youtube page for bigger, high-res viewing here.

Another Mid-Week Tune

So I get asked last night "WTF is Perry Farrell?". .  Anna, where were you in the early nineties?? Don't worry if you can't remember, Perry can't either. . .  I'm guessing it was the late nineties (as a Fresher) that your memory problems began. So this is for you Anna - Perry is the guy with the mic (and yup, that's Dave Navarro on the acoustic guitar):

Jane's Addiction - Jane Says

Mid-Week Tune

Jimmy Eat World - A Praise Chorus

Indexed

A couple more. . . 100% ripped from Jessica Hagy's Indexed:

And unless you're Woody Allen. . . 

Evolution

Graphic from Made by Mammals by Andy Marlow. Graphic reposted from Sam Harris' Project Reason. 

Update: Sam Harris has an excellent talk here at TED. 

The Message

A reader sent me a link to a short talk by Gary Vaynerchuk filmed in SEP 2008. It's all very Web 2.0 - which isn't so surprising considering it was filmed at the peak of the Web 2.0 hype and that he was speaking at the Web 2.0 Expo. . . North American readers will probably recognise Vaynerchuk as the Wine Library guy - that's who he is.

Anyway Vaynerchuk's fairly amusing and has some good stuff to say (in a Web 2.0 sort of way). He talks about:

• Building brand equity;
• Do what you love (a la Guy Kawasaki);
• Legacy is greater than currency;
• And perhaps most importantly: It's all about the hustle.

 Have a watch:

The Trouble with New Zealand: Part II

Last year I wrote about the fundamental problems with the NZ economy in the brief post The Trouble with New Zealand (incidentally this blog's most read). And also in another post A New Tax System for New Zealand. 

The NZ economy has been on a serial decline for years. A rare window of opportunity of being able to do something about it is beginning to close. There is multi-party support for radical change to the tax system, the findings of the multi-partisan Tax Working Group recommended a radical tax system overhaul, and the Prime Minister (the first one in a long long time) comes from a global financial markets career and understands the problem as well as anyone. Moreover, the PM has had the populist political capital and the cover of the GFC (Global Financial Crisis) to instigate and execute change. He has failed on all counts and decided to do next to nothing. Now he's either lacking the balls, or is playing a smart long game and intends to execute a more elaborate plan in his second term. After all, perhaps he figures that the lowest common denominator voting public need some warm-up time to be educated around to such a big change? Time will tell. . . 

Two things will save NZ's economic prosperity if anything is going to. One, a structural shift from private investment in non-productive asset classes (like domestic housing) to productive asset classes. Correcting the skewed incentives in a messy tax system is the easiest way to do this. Two, the further engendering of innovation and a commercial platform to monetise and scale it. Creating juicy tax breaks for different types of early stage venture investors is both an easy and high-octane solution. 

IdeaLog (where I ripped the above graphic from) have a very readable article explaining what a mess NZ has managed to create and how to sort it out. Well worth reading. 

John Key (NZ's current PM) postured himself as the new hope and the man to drive change after 9 consecutive years of Helengrad and the gross ineptitude of Michael Cullen her Finance Minister. He can still deliver. Time is running out, both for him and NZ's economy.

Betting on the Blind Side

The story of John Paulson is well known. Paulson's hedge fund took a massive short position on US subprime before the wave of defaults began.

But Paulson might just have been beaten to the post by a formerly little-known MD with Asperger's syndrome turned fund manager from Cupertino, CA. Not in the absolute size of the return, but by time. About a year before Paulson placed his bets, Michael Burry had beaten him to it.

There's a great article here in Vanity Fair on how he did it and how he reckons he couldn't have done it without his Asperger's to help him.

Beyond Augmented Reality: Digital-Physical Singularity

I wrote a couple of posts back that next generation graphical user interfaces were already here. Integration with technology is becoming socially expected. There are implications for the social contract: a) Those that don't integrate will become marginalised, forming a subset of society that live a parallel, less/ non-technologically integrated life; and b) As digital-physical integration reaches singularity, the implications for data privacy and government control & access become scary. Indeed the a posteriority of this is self evident. Like all evolution, the process is perpetually iterative and the beau ideal will remain just out of reach.

Pranav Mistry of MIT demonstrated his work on this integration a few months ago at TED. His goal: to seamlessly mesh the digital and physical. His work goes beyond a simple gesture-screen based interface a la Minority Report:



Sviokla also touches on the implications of this integration at his blog here.

Late Friday Tune

Incubus - Pardon Me

Risky Business. . .

100% ripped from Jessica Hagy's Indexed:

Minority Report: Redux

Not quite Mr Cruise, but not far from it.

Next generation graphical user interfaces are already here. This one's at least a year old. . . . The choice is becoming remarkably binary: choose to integrate with technology and the perpetual knowledge upgrade. Or choose increasing obsolescence and isolation. For those that have chosen the later and want to catch up,  escape velocity is geometrically inching ever further from their grasp. The only thing that will alter this is a step change in the intuitiveness of future user interfaces.

I spotted this over at Nick Gogerty's. If you head to vimeo site via the HD button, you can watch in HD:


g-speak overview 1828121108 from john underkoffler on Vimeo.

eMapping: Augmented Reality + Beyond. . .

This was filmed this month at TED 2010. It's a presentation on latest generation emapping given by a guy called Blaise who works for Microsoft. This really does leave gmaps in the dust. . . at least for now. Pretty cool stuff:

The Actual Inconvenient Truth

Jeff Rubin spoke at the Business of Climate Change Conference '09. Rubin used to be the Head Economist at CIBC. It's long at 45 mins, but well worth a watch:





Global warming believers, climate change sceptics, and especially investors, will all get something from what he says. If you haven't got time to watch, Rubin's key talking points are: 

• Green socialists won't kick globalisation in the balls - economics will and it's unavoidable;
• Peak Oil is real and it's here;
• Conventional oil is the only oil we can afford to burn;
• The inconvenient truth is that since '05 conventional oil supply has not grown and may not again;
• The trajectory for oil demand is + and will grow hugely if/ when economic fundamentals again take off;
• So you thought ChIndia were fuelling the biggest demand increases in oil demand? Wrong. Micro economics plays much more of a part than you think;
• Never mind the demographic drivers - the future equilibrium price of oil will likely kill house market values in the outer 'burbs of cities/ towns in the developed world;
• Paradigm shift - wage arbitrage from the law of comparative advantage will die from the introduction of carbon tariffs;
• Supply side innovation is too far away to begin saving us - and forget the environment for a moment, he means the economy;
• Peak Oil ≠ peak GDP. The immediate solution lies firmly on the demand side;
• Distance is going to cost more and more. And then a whole lot more; 
• By economic necessity, we will all have to move from a global to a local economy. 

Now this is thought provoking, radical, and logical stuff. Whether his logic proves true is another matter. 

Clearly his arguments have huge implications for countries farthest from centralised global activity (remember: distance costs money). Especially developed nations that rely heavily on exports to drive GDP and imports for some domestic functions. 

I'm familiar with New Zealand which is a good example. NZ's economy is relatively export driven and it is rather import reliant - Rubin says these activities are carbon intensive and suggests both will get hit hard. But does a small nation like NZ have sufficient critical mass to internalise and vertically integrate as Rubin suggests? Maybe it won't have to if it can identify and utilise a sustainable competitive advantage where domestic producers have an offsetting lower carbon output at an earlier stage in the value chain. 

Rubin's views sure do add to the medium term investment case for buying oil stocks.


UPDATE: For those investors of you who wish to read more, Beetle Capital have published a piece called The 2020 Race to Post Oil. HT: MGJ 

A New Tax System for New Zealand

For those who follow what's happening in NZ, the Tax Working Group (TWG) has submitted its recommendations to government. The TWG was set up to review the NZ tax system and provide advice for reform. Bernard Hickey's written a good break down of the report and what it means. For those of you who are interested but uninformed, there's plenty of previous articles from Bernard on the issues here.

As I've written before, there are structural problems with the NZ economy restricting growth and fueling inefficiency. Of these, arguably the most significant is the skewed investment preference of retail investors for residential real estate. This preference is driven by tax incentives and at a deeper level, ignorance.

If the government follows the TWG's advice, the tax incentive will change to a disincentive - with the intention of driving investment from non-productive to productive asset classes. But it won't fix the ignorance problem. Well, not immediately anyway. NZers' proclivity for buy-to-let residential real estate, junk debt (via finance companies), and over-priced domestic corporate bond investment is firmly ingrained. Market efficiency will deal with the ignorance and punish those slow to learn and adapt through poor returns for the risk assumed.

When the reality of the likely tax changes takes hold and domestic retail investors learn that diversification out of their favourite asset classes is helpful, that wall of equity will have to go somewhere. My guess is a good chunk of it will flow into the NZ Stock Exchange. The NZSE provides one of the consistently highest dividend yeilds in the developed world. Offering tax free With capital gains, the retail yield seekers that want their capital return cake too might find this too good to turn down. The NZSE has been under capitalised compared to its developed world peers since the '87 crash when retail investor aversion set in. My bet is things are about to change commencing with a structural break in the tax system - and the NZSE will be on the winning side of the bet.

So You Thought Your National Public Health Service was Inefficient?

It probably is. . . . though this is interesting. . . not sure what conclusions can be drawn. Aggregate public & private health care spending within the OECD:

• Switzerland has the highest listed per person (PP) spend with between 0-4 average annual doctor visits, but only the second highest life expectancy at birth;
• Luxembourg's PP spend is a close second with between 4-8 average annual doctor visits, but only manages a just above average life expectancy;
• The clear winner though is Japan, with an almost 16% below average PP spend with a whopping 12+ average annual doctor visits and the highest life expectancy at birth.

I wonder how much the 2007 USD basing skews the data? Would be interesting to see the same figures on a PPP basis:

Click here for larger source graphic from National Geographic Magazine.

HT: Bernard Hickey.

So You're an Apple User ?

Especially if you're a Guardian-reading, anti-globalisation Apple user rebel, then this is for you:

HT: Bernhard Hickey

Genetics, Behaviour & Bullies

The orchid variant of the DRD4 gene, for instance, increases risk of ADHD (a syndrome best characterized, Cochran and Harpending write, “by actions that annoy elementary-school teachers”). Yet attentional restlessness can serve people well in environments that reward sensitivity to new stimuli.

Interesting that what annoys a primary school teacher might prove ultimately constructive. . . and it would be interesting to hear more about the relationship between dietary 5-HTP intake and 5-HIAA. Rather relevant to endemic users of specific recreational empathic entactogens.

Curious the article raises the "Dunbar Numbers" construct - which is interesting when applied to how large densely populated urban areas such as Mexico City, Tokyo or Moscow develop (would be good to hear Nick Gogerty's anthropological thoughts). Richard Branson had an intuitive take on this for maximal business-social interaction for his businesses/ business units - he restricted each business/ business unit to a limited immediate head count to maintain relational efficiency.

This all leads from another great article from The Atlantic: The Science of Success - worthy of a read.

Post title and original HT also via Mister Gogerty per his site above. Replication really is the highest form of flattery. . .

Mid-week set. . .

Here's a recent set from Soul Clap (via a quicktime webcast). I saw these guys DJ back in summer '05 at the Delano on South Beach - a hard to beat combination. Not a bad way to deal with a Wednesday. . . have a listen.

Friday Tunes

The first for 2010. . . . Grip volume dial and turn clockwise:

Buckcherry - Broken Glass

Bob Mould & friends - The Act We Act