Tag: Finance

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Finance Politics

Day 1558 and Basis Point Bullying

I’ve tried not to pay too close attention to the panicked aftermath of the new tariff regime.

I don’t trade the public markets actively and we’d already made preparations in our personal financial lives for a deleveraged dollar. It seemed clear where things were headed and weakening the dollar solves a couple problems for America.

I am a free trader. I believe in open markets as the most effective means we currently have at our disposal for large scale coordination that works with human nature.

Nevertheless the allure of central planning and collectivism is hard to resist for those in power. The market will adapt and find other ways of allocating assets but the wasted energy of a crisis frustrates investors. Damming the waters only impeded flow.

Each basis point drop saves America 1 billion according to Secretary Bessent. So we’ve an incentive to nuke 30 basis points and keep yields low. And yet the 10 year is still stubbornly high.

The exorbitant privilege of Bretton Woods comes with the fears of a centralized currency managed by technocrats who must give guidance to markets without providing too many surprises.

I grew up with a significant amount of skepticism around the federal reserve and its places to hippie parents and the University of Chicago but even I never thought I’d live to see this kind of test. And I am a Bitcoiner! Maybe Silicon Valley will finally find out what bargain we have with Uncle Sam.

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Politics Preparedness

Day 1550 and Fools, Drunks & The United States of America

Americans are mere days away from the dreaded April 2nd tariff reveal and the mood could not be more sour.

If only America was a few good zoning reform bills further along. Then we could house 700 million more people and our Abundance bro moderate liberals would be in a better mood. Alas it’s easy dunking for most of us when Matty Yglesias weighs in late to the party

I’ve spent the last half decade preparing for a more chaotic world. How it would play out and what would be the driver was anyone’s guess.

I made plenty of bets that energy, compute, and decentralization would be the way in a multi-polar world, but I don’t want to count America out just yet. That’s why we made our last stand in Montana.

“God has a special providence for fools, drunkards, and the United States of America.” Otto von Bismarck

The amusing bit of Trump’s mercantilism is literally only he and a small band of trade administration aids actually think this is sensible economic policy. While I know a tariffs bro personally and I appreciate him as a friend they know I think this approach is dubious.

You know it’s bad when even the king of outlier events Nassim Nicholas Taleb is fretting for Treasury Secretary Bessent. Who is at least qualified to manage the a massive currency crisis.

“He probably gets that whether tarifs make or don’t make sense is irrelevant: any ABRUPT introduction of steep tariffs must lead to a CASCADING & GENERALIZED price action.”

We are damned if you do not because tariffs are the wrong tool for this moment (though most of them are) but because markets like predictable things and cascading price action everywhere makes us dizzy.

Rather like the drunks and the fools mentioned by Bismarck, we’d better hope providence provides in this topsy turvy moment.

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Politics Preparedness

Day 1546 and Present Ephemera

I am backing off some of my “current thing” hyper vigilance for a moment. I need to shake off the noise and find my signal.

The band of possibilities is simply so wide that it feels pointless to react. Who you are will determine everything from here. You must go into the future based on your values. I must strip back to see myself clearly.

The complaints about our geopolitical moment (true and righteous as they may be) are set against a great power conflict that will play out over multiple decades of technological change.

It’s yet unwritten though I have some ambition that we can all play a part in the restructuring of a knowledge abundant world.

The trouble with accelerating into the turn is the sheer stress. We know we need change but how we achieve it is messy.

It seems in some areas we will take the low road. It is a reasonable worry that we are seeing all of the downsides of American choices while the upsides are harder to see. I feel as I’ve only seen the fears I’d had and the changes are made at great cost.

We fucked around and it is finding out season. The present is all ephemera. I need to hold it lightly. The stress it induces serves no purpose. It will pass. I will adapt.

Categories
Medical Politics

Day 1544 and Ownership

Americans are big fans of private property; or so our reputation says. But we’ve got a lot of exceptions, rules and regulations how we exercise our rights in that regard.

From zoning laws to bodily sovereignty, restrictions on what you can do with your “stuff” really runs the gamut in America.

I refused to join security clearance service Clear or take part in genetic testing at 23andMe because I simply didn’t trust that my genetic and biometric data wouldn’t end up being sold to a private equity shop in the event of bankruptcy. Which alas is exactly what is happening to 23andMe.

I don’t care for the state having my biometrics but at least it’s possible to advocate medical rights and personal privacy. The TSA and the State Department have me cleared for TSAPre and Trusted Traveler.

I don’t love it but I’ve got some rights that leviathan is meant to abide by. I don’t believe we’ve yet found a way to bind a corporation to a similar term of service. But the cyperpunk future seems more likely to give us less control not more.

Between the law of the low road and our current tendency toward “the idiot plot” in all areas of life it seems like ownership of our bodies and its data is a pipe dream. Hell you can’t even keep a Signal group chat secure anymore as any old idiot (or savvy Machiavellian) can drop in a journalist.

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Finance Startups

Day 1542 and Future Blind

I am confident in my capacity to judge directional trends over time. I’ve been doing it consistently for close to twenty years. I’ve made solid bets that outweigh the wrong calls.

But right now I feel lost. I feel blind to short and medium term outcomes. I don’t know what happens next or in what order.

I’ve got a lot of working theories about how we orient over the next decade or two but I’ve got low confidence on anything nearer.

Perhaps this is because I simply don’t want my near term predictions to be true. They are too depressing and too cynical and too heartless.

An essay from Venkatesh Rao today titled Low Roads to High Places emphasizes why.

If a necessary historical evolution can occur via a low road or a high road, it will almost always happen via the low road.

He notes the law of the low road may simply be a an emergent consequence of thermodynamics. Entropy being what it is the path of least resistance wins.

Or maybe, as Rao suggests, the low road is a corollary to Abraham Thomas’ principle that to call macro-trends correctly you have to have “boundless optimism about technology and bottomless cynicism about humans.”

I’m just not ready to have bottomless cynicism about humans though I have optimism about technology. It’s possible to change our consensus and narrative direction and we do so regularly. Vibe shifts happen once an hour these days

Abraham Thomas has a theory that venture investing is temporal arbitrage. We are front running narrative consensus.

That’s why we look like herd animals eventually no matter how contrarian the bet was at the start.

Because being optimistic about the material changes that technology can bring has been the road to success. But I can’t decide how cynical I am able to be about my fellow humans.

Categories
Finance Media Politics

Day 1539 and Institutional Trust

Continuing their exceptional data visualization work, the Financial Times shows how young Americans are losing trust in our institutions through a series of grim charts powered by Gallop polling. 

Gallop polling in the FT on young American’s trust

What a fun set of polling data on the day we have Tim Walz stomping around saying industry sucks. We have no future and the people who build just absolutely suck isn’t the best vibe from a vice presidential candidate. But it certainly seems to be a mood.

Why would anyone trust a system that proudly rolls out installment loans for food delivery aligned with payday schedules? The internet is making hay with the Klarna DoorDash partnership.

Decent people suggest we must protect the class of people so bad at math they would use this financial product. Well, actually…go a million nuanced credit understanders. Honestly I’ve never carried a credit card balance because I’m too afraid to do so. But some people yolo their consumption.

Abundance means we need to produce things. Which costs money. It’s hard to take say Ezra Klein’s Abundance tour too seriously when we make it impossible to finance housing but we can finance your burrito taxi. That’s not what anyone was hoping for when they gave all this power to our government. No wonder institutional trust is down.

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Culture Politics

Day 1533 and the Long View

One of the oddities of America’s tax system is how much it comparatively penalizes those who make a high salary over those who earn by investment gains.

I’m sure some neoliberal could give a polished argument about about marginal tax brackets but we absolutely hose high W2 earners relative to capital.

Maybe Americans aren’t so sophisticated about what this means but it seems folks got the gist of it. Older generations owning the S&P and their home found that to be a better investment than just working for a living.

The message seems to be if you have a salary at least try to be a partner in the company yeah? Thats how bankers, lawyers, and other professionals did it.

This is a very boom boom when it works and gets very ugly when it doesn’t.

I find it odious that we tax high earning labor. It stifles social mobility by keeping wealth out of reach of the professional class. The government decides how their money is invested. That makes it much harder to take the long view. Clearly the generation above us didn’t always do so.

Categories
Politics

Day 1526 and PE Owned Rump State

I’ve been trying to not explicitly discuss politics for a couple weeks as it’s hard to have any sense of consensus reality. I spend a lot of time on Twitter as well as reading news. It’s only served to further muddle my mind. I’ve regularly discuss the hostile information environment.

Given the chaotic scene it feels both foolish and necessary to send up signals to others. Venkatesh Rao has me considering cross publishing more of my general rambles to Substack. Especially as other channels become more hostile.

Rao leaves fantastic little notes like the below on whether Americans should prepare for a private equity owned rump state. A thought experiment which feels less far fetched than usual.

Just chagrined bewilderment and embarrassment and private-equity-owned rump state services shambolic-debacling along (ht Bruce Sterling for that turn of phrase). Whimpers over bangs.

As state capacity declines and social cohesion degrades it wouldn’t surprise me if the new institutional powers we trust most are corporations. Imagine Americans in twenty years as scarce but almost mythic progenitors of a corporate governance future.

Sure America may still be a nation state in that future but a United States of corporate charters isn’t all that far off from our original conception. No really check out the Virginia Company.

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Emotional Work Startups

Day 1515 and Hope in the Dark

Given the amount of illness that seems to be plaguing folks this winter I’m surprised we’ve not all decided to hide until Spring thaw.

Every event seems to be a super spreader. Our physical immune systems are shot and I doubt our emotional defenses are much better. Everyone is predicting informational dangers myself included.

It is hard out there and we all experience it in different ways. My medical improvement sprint is plagued with logistical issues, the mold situation in our basement is overwhelming, and yet I have hope that I’ll make it.

o many people are dedicated to building solutions to problems, big and small, that I can’t selfishly let my any of my problems stand in my way. We have to all pull forward together.

I spent a few hours with a portfolio founder working on their fundraise today and I felt my optimism. I enjoyed the flow of work even as the enormous task of raising capital is filled with risk.

I’d taken a risk on directional play earlier in the year. I believe in the founder. They are making their way through YC. I can see their path emerging with every step forward. And I see hope.

Categories
Chronic Disease Media

Day 1509 and Wrapping My Arms Around The Problem

I am seeing some progress in my various home and health projects. I’ve been doing my best to remain optimistic even though I was not feeling well and the sheer amount of changes required was intimidating. But I’m seeing low progress.

An industrial hygienist is coming to do an arm test tomorrow on our basement as well as the rest of the house to confirm the extent of our mold problems. Our hope is that it’s contained to the bathroom in the basement.

If we have to do a bathroom remediation that presents an opportunity to do some renovations. While exciting that is also introducing more risk. But you can’t waste a crisis right?

Stuff I Read

The Agent Problem

CoinDesk reporting on the Libra scandal in Argentina

Politico: Voters Were Right About The Economy

Epsilon Theory “It Was Never Going to Be Me”