FEAR OF CHINA IS JUST RESIDUAL YELLOW MENACE HYSTERIA:


The country should stimulate consumption with spending on education, healthcare and public housing (CHETAN AHYA, 12/11/23, Financial Times)

Its gross domestic product deflator — the broadest measure of prices, taking in all goods and services of a country — is at minus 1.4 per cent and has contracted for two consecutive quarters. Consequently, China’s nominal GDP growth was just 3.5 per cent in the third quarter, much lower than the 6.4 per cent of the US.

A deflationary backdrop poses a few challenges. First, real rates after taking into account deflation will rise, increasing the burden on debtors. Second, even as debt growth slows, it will probably remain higher than nominal GDP growth. And so debt-to-GDP ratios will continue to climb. More crucially, a weaker GDP deflator negatively affects the trends in corporate revenues and profits. If deflation continues to eat into these, companies will cut wage growth, creating a vicious “loop” of even weaker aggregate demand and deflationary pressures.

These issues are particularly challenging in China’s context, considering that it is also facing elevated debt ratios and weakening demographic trends. Along with deflation, these factors combine to present a challenge to China we term the “3 Ds”.

The deflationary pressures in China stem from the deleveraging of the balance sheets of the property sector and local governments. When you consider that the combined debt on these balance sheets accounts for about 100 per cent of GDP, it is hardly a surprise that demand and price pressures are as weak as they have been.

BUT MORE FUN TO BLAME THE PALESTINIANS…:

Israel’s Netanyahu ‘proud’ of preventing Palestinian statehood, labels Oslo Accords ‘fateful mistake’ (The New Arab, 17 December, 2023)

Netanyahu, who was speaking alongside Defence Minister Yoav Gallant and war cabinet member Benny Gantz, also claimed that he had halted the progression of the Oslo peace process, which began in 1993 calling the accords “a fateful mistake”.

The Oslo Accords were an agreement signed by Israel and the Palestinian Liberation Organisation that saw the establishment of the Palestinian Authority in the West Bank and Gaza as part of a process that were meant to lead to a two-state solution to the Palestinian-Israeli conflict.

…and then wonder what they’re so upset about.

CAIN WINS:

Robots Free Humans from Repetitive Tasks (Janna Lu, December 16, 2023, AIER)

Furthermore, Amazon is experimenting with a multi-robot system called Sequoia at an Amazon facility in Houston, Texas. Sequoia delivers all the totes to employees at an ergonomic workstation, where the employee only has to do work between mid-thigh and mid-chest height. This innovation eliminates the need for regular reaching or squatting, further reducing the injury rate.

Sequoia has improved the identification and storage of incoming inventory by 75 percent, reducing the time to list and update inventory on Amazon.com. It has also reduced order processing time by 25 percent, speeding up shipping times.

With the implementation of robotics and AI, Amazon can reduce injuries and ship much faster. In some same-day facilities, packages “prepared for dispatch within 11 minutes of an order placement at same-day facilities,” about an hour faster than in next-day or two-day facilities.

AI also helps Amazon create efficient delivery routes, “adapting in real-time to traffic and weather conditions,” and helps Amazon forecast daily demand for packages so that the company can predict where and when things will be ordered. Delivery hubs can handle over 110,000 packages within the holiday season, up from the 60,000 that they typically handle.

AI and robotics will impact jobs and change various industries, but automation will first start to replace the jobs that people do not want to do.

THE ESENTIALS OF REPUBLICAN LIBERTY:

‘No Taxation Without Representation’ (JUSTIN STAPLEY, DEC 16, 2023, Freemen News-Letter)

When we think of tyranny, we think of the systems of absolute despotism concocted by the likes of Hitler, Stalin, Un, and Mao. But the definition of tyranny held by the early patriots was any arbitrary government act. The power to tax, in their view, was the power to destroy, and thus taxation must derive from a representative body. Were it to derive from any other place, it would demonstrate a threat to their fundamental rights to life, liberty, and property. The question of tyranny, for them, extended beyond specific acts of tyranny and encompassed a consideration of the legitimacy of government power and how it could be used if the people were subjected to arbitrary authority.

ISRAEL’S ONLY EXISTENTIAL THREAT IS INTERNAL:

Are Israel and the United States on a collision course? (DANIEL BRUMBERG, DEC 16, 2023, Responsible Statecraft)


In a December 8 story that seems to have received little attention in western press coverage of Israel’s expanding military campaign in Gaza was this nugget of information: Israel’s military expects combat operations to continue until the end of January, “followed by a three-to-nine-month lower grade insurgency.” Reported by the Jerusalem Post, an English daily whose correspondents appear to have good ties to the Israel Defense Forces, this prediction likely rang alarm bells in the Biden administration. The White House is well aware of Prime Minister Benjamin Netanyahu’s promise to do whatever it takes to “destroy” Hamas. But beyond doubting that this goal is feasible, US officials likely have concluded that Israel is not capable of pursuing its campaign in Gaza without killing many more Palestinian civilians, or is not ready to do so. With the threat of disease and starvation growing as Gazans flee to the south in a nearly hopeless search for safety, the prospect of a major crisis in US-Israel relations is growing. Thus while Israeli leaders applauded the White House’s veto of last week’s United Nations Security Council resolution calling for an immediate ceasefire, they know that the Biden administration supports a wider political and diplomatic approach that Israel’s current government—as Netanyahu has stated—totally rejects.

On December 12, President Joe Biden showed clear dissatisfaction with the Israeli government and Netanyahu. In remarks to donors, Biden reportedly said that Israel is losing support around the world because of how it is conducting the Gaza war. He also reportedly said that Netanyahu “has to change” and that the Prime Minister rejects the two-state solution on which the president has staked his approach to the Palestinian-Israeli conflict.

TAXES DICTATE BEHAVIORS:

Baseball Star Shohei Ohtani’s New Contract Is a Massive Tax Avoidance Scheme. Nice! (ERIC BOEHM, 12.15.202, reason)

But unlike most sports contracts, that $700 million won’t be doled out over the 10-year term of the deal—and, as a result, both Ohtani and the Dodgers are poised to dodge (sorry) some of the taxes they might be otherwise obligated to pay on the record-breaking deal.

The 29-year-old Ohtani will collect $2 million in each of the next 10 years. The rest of Ohtani’s $68 million salary will be deferred for a decade, and the Dodgers will owe it to him in annual installments starting in 2034. By the time Ohtani collects the last of those payments in 2043, he’ll be 49 years old (and almost certainly well into retirement).

Because he’ll be playing most of his games in high-tax California, taking most of his pay via what’s effectively a fixed annuity gives Ohtani the possibility of avoiding some massive tax payments. “By the time he starts receiving the $68 million payments, he may be able to avoid state income taxes by living someplace like Florida without an income tax, or by moving back to Japan,” The Wall Street Journal reported this week.

Disincentives work.

SUBTITLE: COLGATE MAN SAVES DARTMOUTH MAN:

The Origin Story of Rudolph the Red-Nosed Reindeer: How a 1939 Marketing Gimmick Launched a Beloved Christmas Character (Open Culture, 12/13/23)

The magic ingredient that transformed a marketing scheme into an evergreen if not universally beloved Christmas tradition is a song …with an unexpected side order of corporate generosity.

May’s wife died of cancer when he was working on Rudolph, leaving him a single parent with a pile of medical bills. After Montgomery Ward repeated the Rudolph promotion in 1946, distributing an additional 3,600,000 copies, its Board of Directors voted to ease his burden by granting him the copyright to his creation.

Once he held the reins to the “most famous reindeer of all”, May enlisted his songwriter brother-in-law, Johnny Marks, to adapt Rudolph’s story.

The simple lyrics, made famous by singing cowboy Gene Autry’s 1949 hit recording, provided May with a revenue stream and Rankin/Bass with a skeletal outline for its 1964 stop-animation special.

CAIN LIVED, ABEL DIED:

Reading Rousseau: The Social Contract, Part I (Paul Krause, December 15, 2023, Minerva Wisdom)

Rousseau opens his famous work on political philosophy by stating that “Man was born free, and he is everywhere in chains.” Again, this is because in the state of nature man is free and equal, but in society he is enslaved and not free and not equal. “How did this transformation come about?” he asks. “I do not know,” he replies. This is the greatest sleight of hand in philosophical history. Whereas, say, Aristotle saw “natural inequality” as explained it metaphysically: That nature itself is not equal, Rousseau sidesteps the question. Instead, he wishes to discuss how a society can be made to be legitimate. For illegitimate society is the society in which man, having been born free, remains in his chains. This also means, very importantly, that Rousseau begins his political treatise with the understanding that political society is illegitimate.

Once you’ve miscast human nature there’s no way back to common sense for the Continent.

THERE IS NO INDIA:

Narendra Modi’s Punjab Problem (Francis Wade, 12/12/23, NOEMA)

In March, three months before the assassination of the Sikh separatist Hardeep Singh Nijjar in Canada, the Indian government turned the Sikh-majority Punjab into a police state. Its internet was cut and messaging services restricted, gatherings of more than four people banned in some places, and a state-wide cordon and manhunt launched — all just to find one man, a 30-year-old fellow Sikh agitator called Amritpal Singh.

Over the previous year, Singh had been advocating for a separate homeland for Sikhs in northern India. He toured villages and towns in Punjab, a longstanding focal point of Sikh separatist ambitions, garnering a small following. He also drew the attention of security forces. Several weeks before the manhunt began, he and a group of armed supporters raided a police station in Ajnala, close to the Pakistan border, forcing the release of a close aide who was being held there. Singh then went on the run, moving from village to village, crisscrossing state lines, changing vehicles and guises. The police operation that ensued, with house-to-house raids and roadblocks set up across the nearly 20,000-square-mile state, resulted in the arrest of more than 300 people — including, on April 23, Singh himself.

It marked the intensification of a crackdown on Sikh separatists by Narendra Modi’s government — one that soon went international. Nijjar was killed outside a temple in British Columbia by an unknown assassin, an operation Canada pinned on India. Around the same time, according to an American investigation, an Indian official was directing a plot against another Sikh separatist in New York. Allegations of similar plots in the U.K. have since surfaced, and revelations of other India-backed assassination campaigns elsewhere in the world have emerged.

As the Singh manhunt widened in March, journalists and commentators began asking questions. Was Sikh separatism a valid concern, one deserving of such a far-reaching response? Or was the mass deployment of security forces to Punjab and the Indian government’s intensifying rhetoric around “Khalistan” — the long-imagined Sikh homeland beyond the control of New Delhi — serving other ends?

Despite once causing great tumult in Punjab and rocking the foundations of post-independence India, the Sikh separatist cause had lain dormant for three decades: Militant activity was so infrequent as to barely make headlines. As far as security threats were concerned, the government had spent the past decade far more interested in insurgencies in Jammu and Kashmir and the Maoist-Naxalite rebellion in the east.

The crackdown in Punjab — and the targeting of Sikhs on foreign soil that followed — seemed puzzling. Was Singh really raising an army? Did Nijjar really have the support in India to reinvigorate a long-dead insurgency? Or rather, was Modi, with an eye on the 2024 elections, raising the specter of a national security threat in order to sell the idea that his Bharatiya Janata Party (BJP), for whom national security has always been top of the agenda, must be reelected lest India break apart? Might he be diverting attention from the many real crises in Punjab, if not India more generally, that the BJP has been unable to resolve?

THE DOCTOR WILL SCAN YOU NOW:

Underestimating AI in Healthcare (Daisy Wolf, Adela Tomsejova, Jay Rughani, and Vijay Pande, December 13, 2023, Andreesen horowitz)

In the 2000s, technology radically changed not just how stocks were traded, but the decision behind which stocks to trade. Firms like Citadel, DE Shaw, and Two Sigma started to employ High Frequency Trading, computer algorithms capable of executing thousands of trades per second.

Quants, the algorithm writers, overtook master traders, who manually studied companies. Algorithms overtook hunches. The quant funds who led the pack raked in hundreds of billions of dollars.

100% of stock trades used to be made by humans. Today, 80% are made by computer algorithms.

AI is about to bring a similar revolution to healthcare.

Over the next few decades, at least half of the $4.3 trillion dollar American healthcare industry will be AI-driven.

AI will drive drug discovery, proposing medicines not yet dreamed up by man. AI will play a key role in diagnosis, helping humans know what’s wrong sooner so they can get access to life-saving treatments. AI will change how care is delivered, as every human will have a world-class AI doctor in their pocket. And AI will eliminate a lot of the infuriating back office minutia in healthcare.

The markets are significantly undervaluing this opportunity.