(Roughly) Daily

“Commodities tend to zig when the equity markets zag”*…

 

Screen Shot 2020-01-13 at 11.11.12 AM

 

On the subject of things– things that matter, whether we are active investors or not– that we might (to our peril) take for granted…

There are plenty of expensive assets in the world today. The past decade of loose monetary policy and central bank money dumps have created the infamous “bubble in everything”. This is one reason we now have the bizarrely yo-yoing investment environment that we do, in which everything from risky stocks to safe gold is rising at the same time.

But one thing has remained reliably cheap — commodities. While the US equity market, which keeps ratcheting up to new highs, is almost as expensive as in the past 150 years, commodities are about as cheap relative to stocks as they’ve been in the past century.

Part of this is natural — and structural…

And yet, having watched the last big demand-driven oil spike in 2008, as well as the more financially driven price spike in 2011-12, which eventually came undone when central bankers pulled back on quantitative easing, I think it’s unwise to assume that we have entered a permanent bear market in commodities — at least not yet…

… if commodity prices did rise, there would be myriad ramifications. You would start to see the heads of petro states further emboldened, and populist nationalism increase globally — inflation in food and fuel prices hits the poor hardest, encouraging political volatility. That could, in turn, create new trade turmoil and the sort of disruption that the markets are currently discounting.

On the upside, though, demand for commodities is price elastic — once prices go too high, demand always falls. The cycle of replacing one source of energy with another has been playing out for hundreds of years, and continues. In an ideal world, the next commodities bubble, whenever it comes, could help us make what might be the final shift — away from fossil fuels and towards renewables.

The estimable Rana Foroohar explains there are many reasons for the US dollar to weaken, which would (among other drivers) cause commodity prices to rise: “Commodities may not stay cheap forever.”

* legendary investor Jim Rogers

###

As we contemplate cycles, we might rejoice that it was on this date in 1605 that El Ingenioso Hidalgo Don Quijote de la Mancha ( or The Ingenious Hidalgo Don Quixote of La Mancha— aka Don Quixote), the masterwork of Miguel de Cervantes (and of the Spanish Golden Age) was first published.

Original title page

 

Written by LW

January 16, 2020 at 1:01 am

“Oh how wrong we were to think immortality meant never dying”*…

 

quantum-simulation_1024

Quantum simulation (Verresen et al., Nature Physics, 2019)

 

Further (in a fashion) to yesterday’s post…

Nothing lasts forever. Humans, planets, stars, galaxies, maybe even the Universe itself, everything has an expiration date. But things in the quantum realm don’t always follow the rules. Scientists have found that quasiparticles in quantum systems could be effectively immortal.

That doesn’t mean they don’t decay, which is reassuring. But once these quasiparticles have decayed, they are able to reorganise themselves back into existence, possibly ad infinitum.

This seemingly flies right in the face of the second law of thermodynamics, which asserts that entropy in an isolated system can only move in an increasing direction: things can only break down, not build back up again.

Of course, quantum physics can get weird with the rules; but even quantum scientists didn’t know quasiparticles were weird in this particular manner…

Maybe some things are forever.  More at “Scientists Find Evidence a Strange Group of Quantum Particles Are Basically Immortal.”

Read the underlying Nature Physics article, by physicist Ruben Verresen and his team at the Technical University of Munich and the Max Planck Institute for the Physics of Complex Systems, here.

* Gerard Way

###

As we ponder perpetuity, we might send carefully-deduced birthday greetings to Richard Bevan Braithwaite; he was born on this date in 1900.  A Cambridge don who specialized in the philosophy of science, he focused on the logical features common to all sciences.  Braithwaite was concerned with the impact of science on our beliefs about the world and the appropriate responses to that impact.  He was especially interested in probability (and its applications in decision theory and games theory) and in the statistical sciences.  He was president of the Aristotelian Society from 1946 to 1947, and was a Fellow of the British Academy.

It was Braithwaite’s poker that Ludwig Wittgenstein reportedly brandished at Karl Popper during their confrontation at a Moral Sciences Club meeting in Braithwaite’s rooms in King’s College. The implement subsequently disappeared. (See here.)

 source

 

“Nothing happens until something moves”*…

 

Universe

 

What determines our fate? To the Stoic Greek philosophers, fate is the external product of divine will, ‘the thread of your destiny’. To transcendentalists such as Henry David Thoreau, it is an inward matter of self-determination, of ‘what a man thinks of himself’. To modern cosmologists, fate is something else entirely: a sweeping, impersonal physical process that can be boiled down into a single, momentous number known as the Hubble Constant.

The Hubble Constant can be defined simply as the rate at which the Universe is expanding, a measure of how quickly the space between galaxies is stretching apart. The slightest interpretation exposes a web of complexity encased within that seeming simplicity, however. Extrapolating the expansion process backward implies that all the galaxies we can observe originated together at some point in the past – emerging from a Big Bang – and that the Universe has a finite age. Extrapolating forward presents two starkly opposed futures, either an endless era of expansion and dissipation or an eventual turnabout that will wipe out the current order and begin the process anew.

That’s a lot of emotional and intellectual weight resting on one small number…

How scientists pinned a single number on all of existence: “Fate of the Universe.”

[Readers might remember that the Big Bang wasn’t always an accepted paradigm— and that on-going research continues to surface challenges.]

* Albert Einstein

###

As we center ourselves, we might spare a thought for Kurt Friedrich Gödel; he died on this date in 1978.  A  logician, mathematician, and philosopher, he is considered (along with Aristotle, Alfred Tarski— whose birthday this also is– and Gottlob Frege) to be one of the most important logicians in history.  Gödel had an immense impact upon scientific and philosophical thinking in the 20th century.  He is, perhaps, best remembered for his Incompleteness Theorems, which led to (among other important results) Alan Turing’s insights into computational theory.

Kurt Gödel’s achievement in modern logic is singular and monumental – indeed it is more than a monument, it is a landmark which will remain visible far in space and time. … The subject of logic has certainly completely changed its nature and possibilities with Gödel’s achievement.                  — John von Neumann

kurt_gödel source

 

“I don’t mean to be presumptuous, but I liken myself to the robber barons”*…

 

shkreli

 

In the spirit of the Razzies and the “Golden Fleece Award,” The Lown Institute initiated “The Shkreli Awards”…

A top ten list of the worst examples of profiteering and dysfunction in health care, named for Martin Shkreli, the price-hiking “pharma bro” that everyone loves to hate…

Nominees for the Shkreli Awards are compiled by Lown Institute staff with input from readers of Lown Weekly. Winners are determined by an esteemed panel of patient activists, clinicians, health policy experts, and journalists…

Browse the list of 2019’s (genuinely astounding, but sadly all-too-real) “winners” here.  Also see the 2018 and 2017 winners.

* Martin Shkreli

###

As think healing thoughts, we might recall that it was on this date in 1854 that Anthony Fass, a Philadelphia piano maker, was awarded the first U.S. patent (#11062) for an accordion.  (An older patent existed in Europe, issued in Vienna in 1829 to Cyrill Demian.)

“Music helps set a romantic mood. Imagine her surprise when you say, ‘We don’t need a stereo – I have an accordion’.”  – Martin Mull

“A gentleman is someone who can play the accordion, but doesn’t.”  – Tom Waits

accordion_patent source

 

“The science which feeds men is worth at least as much as the one which teaches how to kill them”*…

 

Food revolution

 

We are on the cusp of the biggest economic transformation, of any kind, for 200 years. While arguments rage about plant- versus meat-based diets, new technologies will soon make them irrelevant. Before long, most of our food will come neither from animals nor plants, but from unicellular life. After 12,000 years of feeding humankind, all farming except fruit and veg production is likely to be replaced by ferming: brewing microbes through precision fermentation. This means multiplying particular micro-organisms, to produce particular products, in factories.I know some people will be horrified by this prospect. I can see some drawbacks. But I believe it comes in the nick of time…

Scientists are replacing crops and livestock with food made from microbes and water. It may save humanity’s bacon: “Lab-grown food will soon destroy farming – and save the planet.”

* French epicurean Jean Anthelme Brillat-Savarin

###

As we dig in, we might recall that it was on this date in 1943 that an official of the Meats Division of the wartime Office of Price Administration (OPA) announced that, for the duration of World War II, frankfurters (or ‘hot dogs’) would be replaced with “Victory Sausages,” in which a substantial proportion of the meat in those sausages would itself be replaced with “an unspecified amount of soybean meal or some other substitute.”

Victory was achieved; but it was not, in this dimension in any case, sweet.

meat-340x499 source

 

“There’s many a bestseller that could have been prevented by a good teacher”*…

 

bestseller

 

In November, Donald Trump Jr.’s Triggered hit number one on the New York Times bestsellers list—with an asterisk. Or more accurately, a dagger (†). This is the first time many people noticed this dagger and learned that it means the NYT believes the book has made it onto the list with the help of bulk purchases. It is, however, far from the first book to do this.

In fact, his father helped pioneer the practice among business people.

According to former Trump executive Jack O’Donnell in his 1991 book Trumped, the Trump organization purchased tens of thousands of copies of the Art of the Deal upon its release in 1987. They put copies of the book on pillows during turn-down service. He also pressured his executives to buy 4,000 or more copies of the book each.

Though Trump helped to bring the idea mainstream, he was following in some authors’ footsteps from a decade earlier. Some of the first books known to make the list with the help of bulk purchases were Jacqueline Susann’s 1966 Valley of the Dolls and Wayne Dyer’s 1976 Your Erroneous ZonesThe list started in 1931, so there are probably authors who used this method we’ll never know about.

For those unaware of how bestseller lists work, here’s a primer…

The business of literature: “A History of Buying Books onto the Best Seller List.”

[Image above: source]

* Flannery O’Connor

###

As we rethink rankings, we might recall that it was on this date in 1936 that two masters of classic noir fiction, Raymond Chandler and Dashiell Hammett, met for the first and only time.  The occasion was a Black Mask magazine dinner in Los Angeles, at which the two were among the ten pulp writers (plus an editor) attending.  In the event photo below, both are standing: Chandler is smoking a pipe; Hammett, the tallest, is farthest right.

Black Mask dinner source

 

Written by LW

January 11, 2020 at 1:01 am

“Hands have their own language”*…

 

where_do_finger_names_come_from_1050x700

Saint John the Baptist by Leonardo da Vinci

 

Most body parts come alone or in pairs. We have one nose, one tongue, and one navel. We sport two eyes, two knees, two feet, and so on. Fingers are a glaring exception—we’ve got a party of five on each side. This presents difficulties. When we want to single one out from the group—to specify which finger we slammed in the door, for instance—what do we do? We name them, naturally. But how?

This is a uniquely human problem. Pentadactyly—the condition of having five fingers—is pervasive in the biological world, but we are the only species that has the capacity (or occasion) to talk about those fingers. The problem is not just that we have five of them, but that they are so vexingly similar: they differ slightly in size and dexterity, but all have that pucker-knuckled, nail-capped look. How have people in different times and places solved this problem? How have they named the members of this confusable quintet? Answering this question offers a tour of the inventiveness of the human mind…

Our names for our fingers show a surprising depth of cultural variation—and similarity: “Where Do Finger Names Come From?

* Simon Van Booy

###

As we dub our digits, we might send carefully-timed birthday greetings to a man with very accomplished fingers, Abraham-Louis Breguet; he was born on this date in 1747.  The leading horologist of his day, he introduced a number of formative innovation into watch- and clock-making.  He built the first gong spring (which decreased the size of repeater watches) and the first anti-shock device or “pare-chute” (which improved the reliability of his watches while making them less fragile).  He sold the first modern carriage clock to Napoleon Bonaparte, and created the first “tact watch” by which time could be read by touch.  And finally– and most impactfully– he built the first tourbillon (the self-winding mechanism that introduced the “perpétuelle” watch), which he patented in 1801.

220px-Abraham_Louis_Breguet_02 source

 

 

Written by LW

January 10, 2020 at 1:01 am

%d bloggers like this: