Books
The Bet: Paul Ehrlich, Julian Simon, and Our Gamble over Earth’s Future — This book was published more than a decade ago, but it’s aging well and I recommend it. (Two passages below.)
Facts & Figures
100% — the probability of a recession within 12 months in a forecast issued in October 2022 by Bloomberg Economics’ model. An accompanying article called a U.S. recession “effectively certain in the next 12 months” based on the forecasts by Bloomberg economists Anna Wong and Eliza Winger. (Narrator: A U.S. recession did not occur in the ensuing 12 months and it was never, in fact, effectively certain.)
$3.9 trillion — the shortfall (in a good sense) between actual per capita Medicare spending and what would have been spent had we stayed on the trendline and forecasts of 10 years ago. No one can explain or agree upon the causes(s) and there are many offsetting negatives in healthcare spending, of course, but still…
41 percent, down from 74 percent a decade ago — the number of American young adults who said a college education is “very important.”
Similarly, almost half of parents said they would prefer their children not enroll in a four-year college.
~50% — the approximate share of options expiring in five or fewer days as a percentage of all options-market trading activity, as of August 2023, up from ~1/3 three years ago. (Related: “‘We should stop pretending that’s what’s going on is investing,’ said Benjamin Edwards, a professor at the University of Nevada in Las Vegas who has studied securities law. ‘It’s just gambling.’”)
11,196 — the prison term, in years, handed down to Faruk Fatih Ozer in Turkey after the cryptocurrency exchange he founded and ran collapsed in 2021, costing users an estimated $2 billion.
110 mph — the increase in sustained winds in less than 24 hours in Hurricane Otis, taking Otis from a Tropical Storm (< Category 1), which was the projected maximum strength, to a catastrophic Category 5, with peak sustained winds estimated at 165 mph. Landfall in Acapulco hours later confirmed the NHC’s “nightmare scenario” as the strongest hurricane to ever hit Mexico’s Pacific coast. It also generated a reported 205 mph wind gust that, if verified, would be one of the strongest every recorded on earth.
One quintillion — the number of operations per second that can be performed by Aurora, the new “exascale” supercomputer at Argonne National Laboratory in Lemont, IL. It is billed as the most powerful supercomputer in the world. (One quintillion is a billion billion, or one followed by 18 zeroes.) Scientists hope that peak performance will reach two quintillion operations per second.
Articles
Charlie Munger, Warren Buffett’s Partner and ‘Abominable No-Man,’ Dies at 99 — Just as I was preparing to hit send I saw this news. I’m sure we’ll all see countless tributes and RIP messages in the coming days, but for my part, the best compliment I can pay is that I learned an enormous amount from him and I will carry those lessons with me for years to come.
Charles Feeney Obituary — Chuck Feeney was the businessman behind Duty Free Shoppers and the subject of a fascinating book (The Billionaire Who Wasn’t) that I highly recommend. He was worth approximately $8 billion at the peak, and with a gift of $7 million in 2016 he had emptied the coffers and given it all away to charities he quietly, often anonymously, funded, retaining $2 million for his retirement. Other obituaries here and here.
The Next Big Solar Storm Could Fry the Grid — I’m far from an expert, but I thought this article was a reasonable consideration of a significant issue. Much like pandemics, earthquakes, hurricanes, etc., it’s a question of “when,” not “if.” Preparation would go a long way, but preparation seems lacking…
Sweden moves students off of digital devices, back to books and paper — I’ve always wondered how much of this was generational, but a mix of digital and physical always made the most sense to me, from the standpoint of both learning efficacy and accuracy.
“There’s clear scientific evidence that digital tools impair rather than enhance student learning,” Sweden’s Karolinska Institute, a highly respected medical school focused on research, said in a statement in August on the country’s national digitalisation strategy in education. “We believe the focus should return to acquiring knowledge through printed textbooks and teacher expertise, rather than acquiring knowledge primarily from freely available digital sources that have not been vetted for accuracy.”
Quoted
When Sequoia was looking for a crypto exchange to invest in, FTX was “Goldilocks-perfect,” according to its profile. One big reason: “There was no concerted effort to skirt the law.”
More mind-benders from the excellent recap in “Sam Bankman-Fried’s Wild Rise and Abrupt Crash”:
“Sequoia Capital, a top venture firm that has funded Apple, Airbnb, Instagram and WhatsApp, all but begged Mr. Bankman-Fried to take its money during the mad rush when crypto was shiny and new. Sequoia then commissioned a very long celebration of Mr. Bankman-Fried by Adam Fisher, a longtime Silicon Valley writer who fell hard for the man whose fans called him S.B.F. ‘After my interview with S.B.F., I was convinced: I was talking to a future trillionaire,’ Mr. Fisher wrote. He added: ‘The FTX competitive advantage? Ethical behavior.’”
“‘When I started working at Alameda, I don’t think I would have believed you if you told me I would be sending false balance sheets to our lenders or taking customer money, but over time it was something I became more comfortable with,’ Caroline Ellison, Mr. Bankman-Fried’s colleague and sometime girlfriend, testified during the trial.”
“[S.B.F] calculated the odds on everything — he thought there was a 5 percent chance he would become president of the United States.”
“‘By number of Ponzi schemes, there are way more in crypto, kinda per capita, than in other places,’ [S.B.F.] told The Financial Times in May 2022.”
“I’m very skeptical of books. I don’t want to say no book is ever worth reading, but I actually do believe something pretty close to that.”
The ultimate line came from an interview in April 2022 conducted by Bloomberg’s brilliant columnist Matt Levine:
“I think of myself as like a fairly cynical person. And that was so much more cynical than how I would've described farming. You're just like, ‘Well, I'm in the Ponzi business and it's pretty good.’” SBF replied: “So on the one hand, I think that’s a pretty reasonable response, but let me play around with this a little bit. Because that's one framing of this. And I think there's like a sort of depressing amount of validity. So you've got this box and it’s kind of dumb, but like what's the end game, right? This box is worth zero obviously. … But on the other hand, if everyone kind of now thinks that this box token is worth about a billion dollar market cap, that's what people are pricing it at and sort of has that market cap. Everyone's gonna mark to market. In fact, you can even finance this, right? You put X token in a borrow lending protocol and borrow dollars with it. If you think it's worth like [not] less than two thirds of that, you could even just like put some in there, take the dollars out. Never, you know, give the dollars back. You just get liquidated eventually. And it is sort of like real monetizable stuff in some senses. And you know, at some
point if the world never decides that we are wrong about this in like a coordinated way, right? Like you're kind of the guy calling and saying, no, this thing's actually worthless, but in what sense are you right?”
Will Shortz’s Life as a ‘Professional Puzzle Maker’ — Wow, it’s the 30-year anniversary of Shortz taking over as the NYT Crossword Editor. Some interesting stuff even if you’re not into crossword puzzles.
From Paul Sabin’s book, The Bet:
In these partisan times [Just wait! — Ed.], one sends a book about politics into the world with trepidation. Let me be clear: I believe that we define ourselves in part through our stewardship of the planet. At the same time, there is more than one way to live on our Earth. Where I once saw resource conservation as the only possible answer to scarcity and the limits of nature, now I understand it as far-less-certain effort to apply ethical values in a world of constantly shifting parameters and possibilities. I still keep my thermostat set low. After studying the debates between Paul Ehrlich and Julian Simon, however, moral certainties seem more elusive.
Paul Ehrlich and Julian Simon’s conflict continued long unresolved debates. The structure of their bet, however, matched their times. With its promise of a winner and a loser, determined by the cold, hard math of natural resource prices, the bet epitomized the increasingly polarized rhetoric of American politics. [Just wait! — Ed.] Rather than sober and nuanced assessment of policy alternatives, politicians and commentators simplified complex issues and ratcheted up their opposing claims. Important insights from biology and from economics frequent were placed in oppositions, without sufficient effort to reconciles their tensions and integrate them into a coherent whole. Overly grandiose claims about the constraints of nature or the power of the market fed this clash. Underlying differences in social values and attitudes toward societal risk also often were left unacknowledged. Thought ritually satisfying and motivating for partisans, the rhetorical conflicts helped produce legislative paralysis and deepening political rancor. In this polarizing legacy, climate change became either a myth or the possible end of human civilization. Is there another way to think about the future?