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Home 2017-07-28T13:07:05+00:00

The Death of Dreams

By | October 19th, 2017|

When is an asset class not an investment? Cemetery in Armenia. Photo: Arantz. Source: Wikipedia Assets come in three flavors: true investments, speculations, and gambling. The difference can subtle be subtle, but real. Investments have their own internal cash flow, and you look at the nature of the asset itself to determine whether you want to commit your cash. By that measure, stocks, bonds, and [...]

Reflections

By | October 18th, 2017|

What have we learned from the last 10 years? S&P 500, log scale. Source: Bloomberg In October 2007 the stock market was reaching new highs – levels it did not reach again for another six years. We had begun to hear troubling news about foreign hedge funds and sub-prime mortgages, but those noises seemed like distant thunder on a summer day: of concern to those [...]

Moving the World

By | October 17th, 2017|

Archimedes was right. Source: Wikipedia. “Give me a lever and a place to stand and I shall move the earth.” That’s what Archimedes said when describing the advantage that leverage gives. Force times distance on one side of the fulcrum equals force times distance on the other side. That’s how you can lift a hundred pound weight with only five pounds of push – if [...]

Cold Steel Blues

By | October 16th, 2017|

Cold Steel Blues What’s happening to Kobe Steel? Inside arc furnace. Photo: Payton Chung. Source: Wikipedia Kobe Steel is a metals refiner based in Japan. They have almost 40,000 employees, and they produce aluminum, copper, and titanium as well as steel wire, rod, and rolled products. Most of their sales are to Japanese customers, but they have been expanding globally, especially in China. But that [...]

A Gathering of Eagles

By | October 13th, 2017|

What happens when there are too many predators? Photo: Jessica Weinberg. Source: National Park Service Predatory investors, or shareholder activists, get mixed reviews. On one hand, these investors are exercising their rights as company owners to have management unlock some of the value inherent in a company’s franchise. On the other hand, they often look for short-term gains that can come at the expense of [...]

Healthy Innovation?

By | October 12th, 2017|

Why should we worry about health care? Source: Vox Public health analysts often bemoan the fact that the US spends a lot on healthcare. Health spending accounts for 18% of GDP, while the rest of the developed world spends about 10%. But we get a lot of innovation for that spending. The US has more clinical trials than any other country. We have more patents. [...]

Your Brain On Devices

By | October 11th, 2017|

Are we frying out brains? Photo: Cyclonebill. Source: Wikipedia A recent study indicated that multitasking with email, messaging, Facebook, and various other ways to communicate is changing the way we think and behave. We are undermining our ability to focus, and the immediate gratification that a constant feed provides is highly addictive. Other research shows that our brains get a little dopamine jolt when we [...]

Nudges Towards the Prize

By | October 10th, 2017|

Who is Richard Thaler? Source: Chicago-Booth School Richard Thaler is the Chicago-Booth economist who helped popularized the notion of “nudging” us to make better choices. He’s best known for his work on behavioral economics, the area of study that looks at anomalies in our decision making. For example, if someone gives us tickets to an event worth $500, we tend to keep the tickets. We [...]

95 Lessons

By | October 6th, 2017|

We don’t live in unprecedented times. But they are unusual. Martin Luther posting his 95 Theses. Source: British Museum It’s popular to say that we live in unprecedented times. Things like mobile computing and global social networks are totally new. And from a technological perspective, that’s absolutely correct: we’ve never had so much power in our pockets. Apple’s new A11 Bionic chip on their iPhone [...]