Midsummer July 14, 2018
This year is going by too fast. Somehow, it is already mid July. More...
Links - July 3, 2018
We’ve had a linkless nearly two months on the blog, so here are 35 links to make up for it - hopefully they’re not too overwhelming.
- Big Tech isn't the problem with homelessness. It's all of us. Adam Rogers - Wired
The longer I live in San Francisco, the more desensitized to homelessness I become. I hate that about this city, and I think about it daily. In my opinion, the biggest problem is NIMBYism - there’s an interesting parallel here with the rise in national isolationism, and some irony in San Francisco’s contradictory positions when flipping the scale from local to national. The second biggest problem, which feeds the first one, is a deep misunderstanding of second order effects - the world is dynamic, and it is hard to think of the change brought on by change itself. The solution is clear. Seattle was already the guinea pig. Let’s build more housing.
- Homelessness Is a Tragedy the U.S. Can Afford to Fix Noah Smith - Bloomberg View
Same topic, but with a broader view, and the same messed up incentives. Noah argues that there are policy solutions that must be taken at the federal level to solve this. I agree, but I’m skeptic that we’ll see them any time soon.
- Ways to think about machine learning Benedict Evans
A great framing of the set of technologies that everyone is so excited about but which in many ways doesn’t yet live up to expectations. Sometimes, even people deeply embedded in the Silicon Valley/San Francisco tech world get stuck in the “We’re not facegoopplemazforce, so we don’t have the data, and can’t gain from ML.” This is a mistake. The value is in the domain specific low cost solutions. Echoes a lot of ideas in Tim O’Reilly’s What’s the Future, which I’m reading right now.
- Core Cryptocurrency Use Cases Elad Gil
A quick read that might even interest the skeptics. In essence, Gil sees potential in the store of value story, the payments story, the securitization story, and the digital goods story. Strangely he subdivides SoV into investment and offshore, but I see those two as the same. I’m personally most excited in securitization/smart contracts, which he calls money wrapped in code.
- The Valuation Obsession Fred Wilson - AVC
At the early stage, startup valuations are mostly about signaling. If you’ve raised N million dollars then you can tell people that you were able to do so. If you’ve invested in a company valued at N you’re able to tell your LPs that you got great terms on that company’s last round. If you’re an employee and your company just raised N you can tell that to the recruiter who’s trying to poach you. But in the end, for any number N, most companies that raise N end up dying. We should focus on it less. N is much more about market conditions than it is about a particular startup’s potential.
- How to talk about God in Silicon Valley Oliver Staley - Quartz
In San Francisco, being religious puts you in the minority. As someone who was raised in a religious community and eventually gave up believing in God, and who was often stigmatized by family and friends for it, that aspect of the culture here was a breath of fresh air. Most people in the Bay Area try to be ultra-rational about their spirituality, some bordering on scientism, and I hadn’t experienced that until I moved here. With a wide range of interviews, this piece tries to put the perspective of the religious group in the Bay Area in context. It’s clear that they are not used to being in the minority position, and that brings a lot of interesing contrasts. There’s a lot to be said about what is lost due to the wave of secularization that we’re living, and I am sad that people in tech circles feel ostracized for their religious beliefs (I’m certainly guilty of this ostracization at times) but on the whole I think this is a good step forward. The big question here is how can we build up communities where people feel connected without having a basis in religion. Below I’ve linked to an essay by DFW that’s somewhat related - Everybody Worships.
- Universal Central Bank Digital Currency? Stephen Cecchetti and Kermit Schoenholtz - Money, Banking and Financial Markets
This essay makes two points: (a) digital currencies are already the norm (~90% of M2 is digital), and (b) a central bank issued digital currency would be disastrous to commercial banking. The reason for (b) is that by virtue of supplying universal access to digital currency, the central bank provides a much safer option to park your money, causing a run on private banks, and eventually forcing the central bank to become a larger lender. This is reductio ad absurdum, and IMO has nothing to do with whether the currency is digital or not. It’s about whether the government allows retail accounts. That would hurt the private lending market, leading to less efficient capital allocation. All of this is based on the fact that the rate spread between the central bank and private lenders is small. I just don’t see how that wouldn’t be arbitraged away by the private market picking better projects to lend to. I asked on Twitter for someone to help me understand this better, but to no avail.
- Should peer to peer lenders exist in theory? John Lewis - Bank Underground
What makes banking different from other peer to peer platforms like Airbnb, Uber, or Tinder? Not the kind of question that I expected someone at the Bank of England to be thinking about.
- The Great High School Impostor Daniel Riley - GQ
This was our article club article from a few weeks ago. The story is quite bizarre. Sadly, we all agreed after our meeting that the author could have done a much better job of going for depth instead of breadth. Still worth it.
- What’s the Yield Curve? ‘A Powerful Signal of Recessions’ Has Wall Street’s Attention Matt Phillips - The New York Times
For quite a while now I’ve been saying that the market feels a little too hot, and that there must be a recession coming. This article is similarly pessimistic about it. I don’t feel confident enough to set short positions, but I have kept good chunk of cash at hand to buy whenever shit hits the fan.
- Robots or Job Training: Manufacturers Grapple With How to Improve Their Economic Fortunes Ben Casselman - The New York Times
When labor markets tighten, people get creative. You get robots, and you train high school kids after realizing you don’t really need any credentials. This is a good thing. This is how we move forward.
- San Francisco Restaurants Can’t Afford Waiters. So They’re Putting Diners to Work Emily Badger - The New York Times
Another labor market tightening. This is a topic I had discussed with friends already, and it is good to put numbers to our anecdotes.
- Brexit Versus Trumpit (Wonkish) Paul Krugman - The New York Times
An interesting back of the envelope analysis of why Brexit and Trump’s tariffs are actually different. It’s interesting to think in terms of little economic diagrams - I don’t do this often enough anymore.
- Behold the priest-kings of the future Supreme Court Megan McArdle - Washington Post
This is one of the best articles on politics I’ve read in a while. In essence it is a Rawlsian veil of ignorance argument over how much power the Supreme Court has, and how strange the process of electing its memebers is. “A country where half the citizens feel their concerns have been placed beyond redress or appeal is a country that is headed for trouble.”
- Crypto Commons Mike Maples, Jr. - Medium
Can blockchains be to governance and public goods what the modern corporation and public markets were to private goods? I am pretty bullish on this overall, even if it is hard to see where this paradigm change is taking us.
- Apple is rebuilding Maps from the ground up Matthew Panzarino - TechCrunch
When I sent Hannah this article, she said “Wait, was that what you were working on? secretly? It’s weird that I never knew.” And well, that’s Apple for you. Having worked on some of the tech behind this, I’m quite happy to finally have it see the light of day. No matter how small my contribution was, it’s exciting.
- Cuisine and Empire Eugene Wei - Remains of the Day
This one came from Leon. He found the argument about food replacing music as a status symbol the most interesting, but for me it was much more about the cultural appropriation aspect, and how culture imposes itself in strange subtle ways.
- Unraveling Bolero Radiolab (Podcast)
The brain is strange. This episode tells thestory of Anne Adams, and how her beautiful paintings suddenly became more structured, much like Maurice Ravel’s music had when he was affected by the disease that Adams had just gotten. It’s strange that so many seemingly different abilities are somehow connected to each other.
- A Value Investor Lost in the Valley, with Chris Douvos Patrick O'Shaughnessy - Invest Like the Best (Podcast)
A great conversation about venture capital. The points about how the value added by investors as you shift between seed and series A was super interesting. I might have to listen to this one again.
- Tim Cook’s Dashboard, with Michael Reece Patrick O'Shaughnessy - Invest Like the Best (Podcast)
The point about not reducing distributions to scalar parameters (minute ~34) was very insightful. What are some other things that we treat as scalars when we shouldn’t?
- Curb Cuts 99% Invisible (Podcast)
We take details of urban design for granted. I bet you had never thought about the fact that someone had to put those little ramps on street corners. I surely hadn’t.
- Post-Narco Urbanism 99% Invisible (Podcast)
If you have watched Narcos, you should listen to this episode. Exploiting the dark past of a city for tourism is an interesting moral problem. Reviving the city is a more interesting challenge.
- Glen Weyl on Radical Markets Russ Roberts - Econtalk (Podcast)
On my last post I mentioned this EconTalk episode was coming, and it did not disappoint. Out of all the suggestions, I think the rethinking of property tax is the most interesting, and possibly the most non-consensus. I want to read this book.
- Michael Pollan on Psychedelic Drugs and How to Change Your Mind Russ Roberts - Econtalk (Podcast)
This interview was interesting because Russ usually plays the spiritual role, instead of the skeptic one, but here he’s the skeptic. I have been intrigued by the idea of psychedelics since I read about Steve Jobs’ use of them in his biography, and Pollan makes a great case for them backed with strong evidence, and apparently good science. It made me think a lot of Reply All’s “Shine On You Crazy Goldman”, which discusses microdosing, and Sam Harris’ Drugs and the meaning of life. All of these conversations bring up interesting questions about the labeling and stigma that different substances have, and make you wonder why we accept some of them while repudiating others. For the most part, I think it’s path dependence. A couple of my friends are reading Pollan’s book now, so more conversations about this are coming.
- Robin Hanson on the Technological Singularity Russ Roberts - Econtalk (Podcast, 2011)
Hanson’s views about emulating brains and how this kind of technology would affect labor markets are fascinating. The moral side of it is not too different from one of the questions raised by Weyl’s book mentioned above - assuming these ems are indistinguishable from people, is it fair/moral to bring them to the world and take a cut of their earnings? How do their needs and desires balance out? We’ve seen some of this tech roll out between this being recorded 7 years ago and now, but I’m sure that within our lifetimes we’ll see us get a lot closer than Hanson suggests.
- Smith, Ricardo, and Trade Russ Roberts - EconTalk (Podcast, 2010)
Trying to understand why tariffs are bad, and get some sound reasons to reject the US’s current position on trade, I went back to look at what Russ had to offer on the classical trade theory. He gives a lot of really good and really basic examples on the points of returns to scale and comparative advantage, and debunks protectionism as a good long-term strategy.
- Network Effects, Origin Stories, and the Evolution of Tech Andreessen Horowitz (Podcast)
Hearing Sonal Chokshi and Marc Andreessen interview anyone together is generally worthwhile, but this one with Brian Arthur was exceptional. Arthur is an economist and complexity researcher. He pretty much came up with the idea of lock-in, which is elemental in how we think of business strategy and product development today. His paper on the topic, from 1983, was rejected by 4 leading econ journals, and was only published 6 years later. He kept getting reviews saying "We can’t find fault in this but this isn’t economics!" This is a conversation about that topic, as well as company formation in general.
- The Oral History of TrialPay – Obstacles and Opportunities in Payments Andreessen Horowitz (Podcast)
The story of a startup I had never heard about, and the B2B2C wonder that they built via channel partnerships. The model is super interesting - consumers get something for free in exchange for buying/trying the product of another TrialPay advertiser. The merchant is then paid for by the advertiser. Say you needed softwre X. X costs $10, which is more than you can pay, but if you sign up for a month of Netflix, you could get X for free. If you were on the fence on Netflix, now you have a good reason to try it - you were going to spend the $10 anyway on X - but Netflix’s LTV from acquiring you is much higher than that, and the cost of acquisition ends up being a payment to TrialPay and a payment to X, which can be much much lower than that LTV. This is something that I had never even thought of, and overall a really interesting business model.
- A Series of Mysterious Packages Planet Money (Podcast)
A crazy dive into the rabbit hole of unexpected packages landing on our doorsteps, and the fake reviews they enable on the internet.
- Noah Smith on Immigration Economics David Beckworth - Macro Musings (Podcast)
For a while now, Noah has been pushing a comprehensive case to open up immigration in the US. Including a slew of facts that show why the current nativist wave is based on false premises, as well as economic arguments for further opening up the borders, his platform is one I can definitely get behind. I’m biased, and I believe there’s a moral case for the US to open up, but the strongest arguments Noah makes are all in the economic interest of the country, not just the immigrants. This conversation is a good summary of his views.
- It's My Party and I'll Try If I Want To This American Life (Podcast)
Years after living here, I’m still wrapping my head around the way that American politics revolves around money, and how exorbitant the amounts necessary to run a successful campaign are. In this episode of TAL there is a broad discussion of how this works within the Democratic Party, as they tell the story of Jeff Beals, a primary candidate for Congress who tried to stand against some of these ideological stances - and lost.
- Kenyon Commencement Address (2005) David Foster Wallace
After months (years?) of hearing Russ Roberts bring up this commencement speech in his podcast, I finally put in the time to read the whole thing. It is an expansion of the kind of train of thought I got in the first time I heard of the word sonder.
- Meaning chains with word embeddings Benjamin M. Schmidt - Sapping Attention
By now most people who deal with machine learning or natural language processing in some way are familiar with the King - Man + Woman = Queen example from word2vec. Here, Schmidt brings up a similarly relatable example: What word is between duck and soup? What words sit between the middle point and those extremes? Iterating these chains brings up really cool patterns.
- UIs that accidentally amass memories (tweetstorm) Marcin Wichary - Twitter
Have you ever opened some settings menu in an old computer, and been surprised with how the results reminded you of some previous experience? Here’s a long list of interesting UIs that unintentionally do that exact thing. From your wifi history, and your phone’s alarms to your Gmail drafts, and more.
Pride '18 June 27, 2018
Every year I’ve been in SF, I’ve looked forward to Pride to take photos. The set of characters that show up, the crazy outfits, and the overall level of happiness are not matched by any other event I’ve ever been to. At least in that sense, this year didn’t fail to surprise me. Continue reading...