Is it just me, or are the signs of consumer collapse as clear as a Lowes parking lot on a Saturday afternoon? Sometimes I wonder if I’m just seeing the world through my pessimistic lens, skewing my point of view. My daily commute through West Philadelphia is not very enlightening, as the squalor, filth and lack of legal commerce remain consistent from year to year. This community is sustained by taxpayer subsidized low income housing, taxpayer subsidized food stamps, welfare payments, and illegal drug dealing. The dependency attitude, lifestyles of slothfulness and total lack of commerce has remained constant for decades in West Philly. It is on the weekends, cruising around a once thriving suburbia, where you perceive the persistent deterioration and decay of our debt fixated consumer spending based society.
The last two weekends I’ve needed to travel the highways of Montgomery County, PA going to a family party and purchasing a garbage disposal for my sink at my local Lowes store. Montgomery County is the typical white upper middle class suburb, with tracts of McMansions dotting the landscape. The population of 800,000 is spread over a 500 square mile area. Over 81% of the population is white, with the 9% black population confined to the urban enclaves of Norristown and Pottstown.
The median age is 38 and the median household income is $75,000, 50% above the national average. The employers are well diversified with an even distribution between education, health care, manufacturing, retail, professional services, finance and real estate. The median home price is $300,000, also 50% above the national average. The county leans Democrat, with Obama winning 60% of the vote in 2008. The 300,000 households were occupied by college educated white collar professionals. From a strictly demographic standpoint, Montgomery County appears to be a prosperous flourishing community where the residents are living lives of relative affluence. But, if you look closer and connect the dots, you see fissures in this façade of affluence that spread more expansively by the day. The cheap oil based, automobile dependent, mall centric, suburban sprawl, sanctuary of consumerism lifestyle is showing distinct signs of erosion. The clues are there for all to see and portend a bleak future for those mentally trapped in the delusions of a debt dependent suburban oasis of retail outlets, chain restaurants, office parks and enclaves of cookie cutter McMansions. An unsustainable paradigm can’t be sustained.
Conservatives, Democrats and the convenience of denouncing free speech
Nothing tests one’s intellectual honesty and ability to apply principles consistently more than free speech controversies. It is exceedingly easy to invoke free speech values in defense of political views you like. It is exceedingly difficult to invoke them in defense of views you loathe. But the true test for determining the authenticity of one’s belief in free speech is whether one does the latter, not the former.
The anti-US protests sweeping the Muslim world have presented a perfect challenge to test the free speech convictions of both the American right and the Democratic party version of the left. Neither is faring particularly well.
Let’s begin with the Democrats. On Thursday, the Obama White House called executives at Google, the parent company of YouTube, and “requested” that the company review whether the disgusting anti-Muslim film that has sparked such unrest should be removed on the ground that it violates YouTube’s terms of service.
In response, free speech groups such as the ACLU and EFF expressed serious concerns about the White House’s actions. While acknowledging that there was nothing legally compulsory about the White House’s request (indeed, Google announced the next day they would leave the video up), the civil liberties groups nonetheless noted – correctly – that “it does make us nervous when the government throws its weight behind any requests for censorship”, and that “by calling YouTube from the White House, they were sending a message no matter how much they say we don’t want them to take it down; when the White House calls and asks you to review it, it sends a message and has a certain chilling effect”.
Right-wing commenters loudly decried the White House’s actions on free speech grounds. Some of their rhetoric was overblown (the sentiment behind the request was understandable, and they did nothing to compel its removal). But, for reasons made clear by the ACLU and EFF, these conservative objections were largely correct.
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What ‘pivot’? Real US-China war will be over money
Anyone who fears that Washington’s “pivot” towards the Pacific increases the risk of conflict between the United States and China is behind the times.
America and China are already at war. Only the battle ground isn’t the East China Sea. It’s money.
In his latest book Paper Promises author and Economist columnist Philip Coggan describes economic history as an endless struggle between borrowers and lenders over the irreconcilable difference in their interests.
Today that difference pitches the US, as the world’s largest debtor, into conflict with China, the planet’s biggest creditor.
Coggan explains that creditors are always trying to defend the soundness of money as a store of value, in order to ensure they get paid what they are owed.
Debtors, on the other hand, have a powerful incentive to debase the value of money, which effectively lets them off the repayment hook.
A Lonely Redemption
“Sandy’s right; government created a banking oligopoly with no accountability,” said Peter Solomon, a friend of Mr. Lewis’s who runs an investment banking firm.
Arthur Aeder, a retired accounting executive, was twice fired by Mr. Lewis. “Not many antagonize Goldman just for the hell of it,” Mr. Aeder said. “Most people think, ‘I have a family to feed.’ ”
Mr. Lewis is no less harsh on himself. After a visit, he handed us laptops containing every furious e-mail he had sent and received over 10 years.
“The Wall Street ethic broke decades ago,” he said by way of goodbye. “The stink is terrible.”
Why is there so much mediocrity?
Two years ago I graduated from Oxford university with a 2:1 in philosophy, politics and economics. After a year of looking for a job, I was hired by a large and very well-known business. At first I was in awe, but now I’ve discovered something that surprises and depresses me. Most of my colleagues are neither terribly bright nor terribly hardworking. As this is my first experience of corporate life I’m puzzled and want to know – is it me? Is it them? Am I missing something? I just don’t get it; if these companies are so hard to get into, how come most of the people who have made it are so mediocre?
Graduate trainee, male, 24
Bailout Recipients
We’re tracking where taxpayer money has gone in the ongoing bailout of the financial system. Our database accounts for both the broader $700 billion bill and the separate bailout of Fannie Mae and Freddie Mac.
For each entity, we provide a “Net Outstanding” amount, which shows how deep taxpayers are in the hole after accounting for any revenue the government has received (usually through interest or dividends).
Companies that failed to repay the government and resulted in a loss are shaded red. You can see a list of those investments here. All other investments either returned a profit to the government or might still be repaid. Recipients of aid through TARP’s housing programs (such as mortgage servicers and state housing orgs) received subsidies that were never intended to be repaid, so we don’t mark those as losses..
A Panoramic View of China’s Cultural Revolution
Li Zhensheng’s photographs of the Chinese Cultural Revolution are perhaps the most complete and nuanced pictorial account of the decade of turmoil ignited by Mao Zedong.
Mr. Li was a photojournalist for the local paper in Harbin, capital of China’s northernmost province of Heilongjiang. That is where he did his life’s work documenting the Cultural Revolution, taking the “positive” propaganda images of masses whipped up in revolutionary fervor for the newspaper, and also the “negative,” more nuanced, questioning pictures. He snipped those frames off his film and hid them under the parquet floorboards of his house until the revolution ended. He did not show these pictures in China until the late 1980s. Even today, given the sensitivities that linger over the Cultural Revolution in China, his work is more often seen overseas rather than at home.
5 questions with Don McLean
1 When you look back over four decades in the music business, what do you consider to be your greatest accomplishment?
The main thing I would like to say is that I have become the person I wanted to be. As opposed to reaching goals but being an alcoholic, or reaching goals but having four failed marriages, or reaching goals but having kids in rehab. A lot of people reach their goals, but at a terrific price.
Your Body Double Could Be This Robot Some Call ‘FaceTime On Wheels’
Though the first one hasn’t even come off the production line yet, the makers of a new “telepresence” robot called the “Double” attracted more than $1 million worth of preorders within three weeks.
“It’s a Segway for your iPad,” quipped David Cann, founder and chief executive of Miami-based Double Robotics, at Y Combinator’s Demo Day in August, where he showed off the robot’s capabilities to investors.
Connecting an iPad to the Double turns it into a roving telepresence device. The first edition Double features an aluminum base, urethane and plastic wheels, custom control systems and iOS software that lets a user remotely drive the robot, video chat with those who it encounters, and peer into the spaces where it roams.
Black Swan Farming
I’ve done several types of work over the years but I don’t know another as counterintuitive as startup investing.
The two most important things to understand about startup investing, as a business, are (1) that effectively all the returns are concentrated in a few big winners, and (2) that the best ideas look initially like bad ideas.
The first rule I knew intellectually, but didn’t really grasp till it happened to us. The total value of the companies we’ve funded is around 10 billion, give or take a few. But just two companies, Dropbox and Airbnb, account for about three quarters of it.
In startups, the big winners are big to a degree that violates our expectations about variation. I don’t know whether these expectations are innate or learned, but whatever the cause, we are just not prepared for the 1000x variation in outcomes that one finds in startup investing.