Monday, February 19, 2018

Oak Ridge National Laboratory's Report On China's Fastest Supercomputer in the World

Sunway TaihuLight is the computer ORNL will surpass later this year with the new Summit system, more than doubling the speed of the Sunway TaihuLight.
However....China is already planning an exascale machine, five times faster than Summit, capable of a billion billion calculations per second.
This piece is a personal bookmark I'll probably be referring back to. 

From Oak Ridge National Laboratory:

June 24, 2016
Report on the Sunway TaihuLight System
Overview
The Sunway TaihuLight System was developed by the National Research Center of Parallel Computer Engineering & Technology (NRCPC) , and installed at the National Supercomputing Center in Wuxi (a joint team with the Tsinghua University, City of Wuxi, and Jiangsu province) , which is in China's Jiangsu province. The CPU vendor is the Shanghai High Performance IC Design Center. The system is in full operation with a number of application s implemented and running on the system. The Center will be a public supercomputing center that provides services for public users in China and across the world. The complete system has a theoretical peak performance of 125 .4 Pflop/s with 10,649,600 cores and 1.31 PB of primary memory . It is based on a processor , the SW26010 processor, that was designed by the Shanghai High Performance IC Design Center. The processor chip is composed of 4 core groups (CGs) , see figure 1 , connected via a NoC , see figure 2, each of which includes a Management Processing Element (MPE) and 64 Computing Processing Elements (CPEs) arranged in an 8 by 8 grid. Each CG has its own memory space, which is connected to the MPE and the CPE cluster through the MC. The processor connects to other outside devices through a system interface (SI).

Each CPE Cluster is composed of a Management Processing Element (MPE) which is a 64 - bit RISC core which is supporting both user and system modes, a 256 - bit vector instructions, 32 KB L1 instruction cache and 32 KB L1 data cache, and a 256KB L2 cache. The Computer Processing Element (CPE) is composed of an 8x8 mesh of 64 - bit RISC cores, supporting only user mode, with a 256 - bit vector instructions, 16 KB L1 instruction cache and 64 KB Scratch Pad Memory (SPM)....
...MUCH MORE (24 page PDF)

Recently:
January 29
"China set to launch its new supercomputer"
NVIDIA watches, some commentary after the jump...
January 11
With the Summit Supercomputer, U.S. Could Retake Computing’s Top Spot (NVDA)
September 2017
"The Astonishing Engineering Behind America's Latest, Greatest Supercomputer"

And many more, including:
June 2016

"Simultaneous harvest failures in key regions would bring global famine, says the Met Office"

We're probably a couple years from this concern even becoming a possibility so there's no immediacy and additionally the choice of the U.S. and China as the location of the crop failures is a bit problematic, based as much on ease of modeling as on the probability of the scenario unfolding.
Agricultural catastrophe could just as easily strike via a combination of cool/damp in Ukraine and western Russia along with drought in India.

You'll hear more over the next few years but the point to be made right now is: We have just experienced 30-some years of near-perfect conditions for industrial scale agriculture and are at risk of complacently forgetting the lesson of Tennyson's "In Memorium".*

From The Guardian, July 15, 2017:

Simultaneous harvest failures in key regions would bring global famine, says the Met Office 
Maize, rice, wheat: alarm at rising climate risk to vital crops

Governments may be seriously underestimating the risks of crop disasters occurring in major farming regions around the world, a study by British researchers has found.

The newly published research, by Met Office scientists, used advanced climate modelling to show that extreme weather events could devastate food production if they occurred in several key areas at the same time. Such an outcome could trigger widespread famine.

The scientists, led by Chris Kent, of the Met Office, focused their initial efforts on how extreme weather would affect maize, one of the world’s most widely grown crops. Heat and drought were the prime risks, although flooding was also included in the analysis.

The group found there is a 6% chance every decade that a simultaneous failure in maize production could occur in China and the US – the world’s main growers – which would result in widespread misery, particularly in Africa and south Asia, where maize is consumed directly as food.

“The impact would be felt at a global scale,” Kent told the Observer. “This is the first time we have been able to quantify the risk. It hasn’t been observed in the last 30 years, but the indications are that it is possible in the current climate.”

An example of the kind of disaster that could occur is provided by the maize harvests that failed last year in Africa. Communities in Zambia, Congo, Zimbabwe, Mozambique and Madagascar were affected and six million people were left on the brink of starvation. A joint failure of China and America’s maize harvest would have a far greater impact.

Having studied the risks facing maize production, the group is now following up this work by studying climate impacts on the world’s other staple crops – in particular rice, wheat and soya beans – in order to assess how weather extremes could affect their production.

According to the UN Food and Agriculture Organisation, maize, rice and wheat together make up 51% of the world’s calorie intake. Billions of people rely on these crops for survival. Any disruption to their production would have calamitous consequences.

The trouble is that crop-growing methods and locations have changed considerably over time, as has the climate and the probability of extreme events, Kent told the Observer. “This means the number of relevant observations to the present-day growing of stable crops has been reduced, and that limits our ability to have useful estimates of the risks to the growing of these crops.”

To get round this problem, the team ran 1,400 climate model simulations on the Met Office’s new supercomputer to understand how climate might vary in the next few years and found that the probability of severe drought was higher than if estimated solely from past observations. The scientists concluded that current agricultural policies could considerably underestimate the true risk of climate-related shocks to maize growing and food supply.


The particular risk outlined by the study envisaged simultaneous catastrophic disruptions in China and the US. In 2014 total world production of maize was around 1 billion tonnes, with the US producing 360 million tonnes and China growing 215 million. If production in these two countries were hit by simultaneous extreme weather events, most likely droughts, more than 60% of global maize production would be hit....MORE
Here's the paper via the Institute of Physics:

Using climate model simulations to assess the current climate risk to maize production

*Fifty-sixth stanza of Tennyson's "In Memoriam":
Man her last work, who seem'd so fair,
Such splendid purpose in his eyes,
Who roll'd the psalm to wintry skies,
Who built him fanes of fruitless prayer,

Who trusted God was love indeed
And love Creation's final law -
Tho' nature, red in tooth and claw
With ravine, shriek'd against his creed -
Much of the world, including large populations in the developed world, are only a few weeks (paychecks) removed from that nature, red in tooth and claw.

Lest We Forget, In April 2017 Platts Forecast Lithium Supply Would Outweigh Demand by 2018

This recollection was triggered by a story that crossed a few days ago. First up, from Platts:

Lithium supply to outweigh demand by 2018, cobalt to remain tight: CRU
Dublin (Platts)--26 Apr 2017 952 am EDT/1352 GMT
Lithium supply was expected to outweigh demand as early as next year, UK-based consultancy CRU's Rebecca Gordon said Wednesday, while the cobalt market should remain tight well into the next decade on continued supply shortness.

While massive growth in battery demand was set to see consumption of both metals soar in coming years, new lithium supply was expected to match demand by 2018, reaching a peak of 25% of total supply by 2022, Gordon told a Minor Metals Trade Association meeting in Dublin.

"The 2016 lithium cost curve shows why prices had to rise so sharply," Gordon said, referring to lithium carbonate and hydroxide spot prices of over $10,000/mt in 2017, having doubled in less than 12 months on rising expectations of a demand boom from battery metals and tightness in supply.

"By 2020, the picture has changed, with brine expansions and new hard rock production keep prices in check and $6,500-7,000 the new cost level."

By that time, China's brine resources in Tibet and Qinghai were expected to come online, reducing unit costs, while spodumene resources in Sichuan and lepidolite resources in Jianxi were "committed and probable", Gordon said.

Even modest demand forecasts see annual lithium output growing to 500,000 mt by 2020 from around 200,000 mt currently....MUCH MORE
And the story that triggered this stroll down Memory Lane? From the Financial Times, February 16:

Sale of $5bn lithium stake to test electric car hype
PotashCorp plans to sell a big stake in Chile’s SQM, a key supplier of the metal

When Canadian fertiliser company Potash Corp acquired shares in Chile’s SQM almost 20 years ago, the latter’s lithium business appeared an afterthought. Controlled by Julio Ponce, the well-connected son-in-law of Chile’s former dictator, Augusto Pinochet, SQM was known as a fertiliser company.

However, the then obscure lithium business is why the 32 per cent stake is now valued at $4.7bn. Lithium has hitched a stunning ride on the wave of interest in electric cars, making it one of the world’s hottest commodities. SQM’s lithium business generates about 60 per cent of the profits for the company, which is in talks with Elon Musk’s Tesla over a deal to supply lithium, a key ingredient in electric car batteries. It is against this backdrop that Potash is being forced by regulators to sell the stake as a condition of its merger with rival Canadian fertiliser producer Agrium.

While only a handful of companies are likely to compete for the stake, the eventual price will be an important measure of how seriously the hype around electric cars is being taken. “It’s a good barometer of where lithium is today,” Simon Moores, founder of London-based consultancy Benchmark Mineral Intelligence, says. “Anyone investing $5bn has to invest for the long term, on a 10- to 20-year horizon, and so there’s no doubt you have to be extremely bullish on lithium.” ...
...MUCH MORE

FT Alphaville's Alexandra Scaggs Writes Like a Boy

Thus sayeth HackerFactor's gender guesser. Using a sample from Alexandra's "Someone is wrong on the internet, the 'decline of men' edition" and being careful to excise the quotes from Tyler Cowen, the analyzer says:

Results:
Total words: 366

Genre: Informal
  Female = 568
  Male   = 808
  Difference = 240; 58.72%
  Verdict: Weak MALE
Weak emphasis could indicate European.

Genre: Formal
  Female = 321
  Male   = 569
  Difference = 248; 63.93%
  Verdict: MALE

We tried two other analyzers, Genderanalyzer.com and the analyzer at the Stevens Institute of Technology. Unfortunately the former kept giving an error message and the latter 503'd with 'Service Temporarily Unavailable'.

The results from Hacker Factor are in line with those we found for Ms Scaggs' boss in 2014's
 "Alphaville's Izabella Kaminska Writes Like a Boy (but is kind to the elderly and robots)"

The World's Largest Art Auction: "The Collection of Peggy and David Rockefeller"

What Is Killing Frogs Around the World? (hint: not what you've been told)

Of course I don't know what you've been told, and being presumptuous is a bad habit on a few different levels but I'm guessing you haven't been told this:

From West Hunter:

Plague of Frogs
Starting in late 80s, herpetologists began noticing that various kinds of frogs were declining and/or disappearing. There was & is a geographical pattern: Wiki says “Declines have been particularly intense in the western United States, Central America, South America, eastern Australia and Fiji.”

Many were hard to understand in terms of human impact. “For example, the Golden toad (Bufo periglenes) endemic to Monteverde, Costa Rica, featured prominently. It was the subject of scientific research until populations suddenly crashed in 1987 and it had disappeared completely by 1989.[9] Other species at Monteverde, including the Monteverde Harlequin Frog (Atelopus varius), also disappeared at the same time. Because these species were located in the pristine Monteverde Cloud Forest Reserve, and these extinctions could not be related to local human activities.”

For a few years the herpetologists were concerned yet happy. Concerned, because many frog populations were crashing and some were going extinct. Happy, because confused puppies in Washington were giving them money, something that hardly ever happens to frogmen. The theory was that amphibians were ‘canaries in a coal mine’, uniquely sensitive to environmental degradation.
Possibly frogs were being killed by an increase in UV radiation (from CFCs). Of course you could always put out a fucking ultraviolet photometer and measure the UV anywhere and anytime you wanted, but that would be the easy way out. Why do that when you could be paying graduate students to play with frogs?

In 1993, people discovered an odd fungus [Batrachochytrium dendrobatidis] infecting frogs in Queensland. Since then it has been linked to many dramatic population declines in “western North America, Central America, South America, eastern Australia, East Africa (Tanzania) and Dominica and Montserrat.” Some species it bops, others it exterminates. Frog species with few offspring and high parental investment, such as mouth-breeding frogs, seem particularly vulnerable. It works like an STD, which can propagate when population density is low. Frogs congregate in ponds to mate, which allows transmission, as long as the frogs mate at all.

It took some time for herpetologists to admit that this chytrid fungus is the main culprit – some are still resisting. First, it was a lot like how doctors resisted Semmelweiss’ discoveries about the cause of puerperal fever – since doctors were the main method of transmission. How did this fungus get to the cloud forests of Costa Rica? On the boots of herpetologists, of course.

The second problem is Occam’s butterknife: even though this chytrid fungus is the main culprit, it’s just got to be more complicated than that. Even if it isn’t. People in the life sciences – biology and medicine – routinely reject simple hypotheses that do a good job of explaining the data for more complex hypotheses that don’t....MORE

Happy (belated) New Year: CLSA's Feng Shui Index 2018

From CLSA:
Who let the dogs out?!
Woof, woof-woof  
Calling all stargazers - prick up your ears
As is tradition, our annual CLSA Feng Shui Index offers an alternative look at what's in store for you and the Hang Seng in 2018, more for your pleasure than profit, but you never know, you may just get lucky!

Like astrologists summoned in the West by politicians and lesser mortals, Feng Shui masters are valued in the Orient by those looking to foretell the future. If you're running a hedge fund, no doubt you'll take our sorcerer's view of fortunes in the Year of the Dog with no more than a wag of the tail, but curiosity if not superstition may get the better of you.

Scroll down to sniff out all manner of forecasts for the year ahead. Peering into the polished doggy bowl, we reveal your zodiac's health, wealth, love and career stars, speculate on what awaits some celebrities, suggest a good place to kennel and, most importantly, predict the Hang Seng Index's monthly dog path and the auspiciousness of particular days.
Some predictions - All the thrills and spills
UN scientists introduce edible straws, bottles, cups and shopping bags to combat pollution • Blue-collar provincial workers drive China's consumer market to stratospheric highs • Chinese ecommerce players ramp-up blockchain to track transactions in their supply chains • Australia wins the FIFA World Cup • Canines object to pejorative and sexist terms "dog" and "bitch", insisting on gender-neutral "hound" • North Korea sells all its nukes at a premium to Nuclear Nonproliferation Treaty members • Dog streaks across pitch, running off with the ball, at opening match of FIFA World Cup in Russia • Saudi Arabia allows women to drive, beginning June 2018 • Chinese government announces “No Eating of Dogs in the Year of Dog Ordinance” • Bitcoin hashing power drops to 1/1000 of its former strength • Theresa May hounded out of office • South America goes to the dogs • Shipping accidents abound • England contraindicated for logistics/traffic issues • India hit by domestic health issues

And here's our forecast!
CLSA Feng Shui Index, 2018
On Sunday, 4 February, the Earth Dog marks his territory. Again, we attempt to plot the pattern and relative magnitude of the HSI's monthly movements in the year ahead using a Fortune Scale. The spirits forbid us from associating ourselves with any number masquerading as a scientifically determined HSI target! So how will we fare this year?
...More

Sunday, February 18, 2018

Meanwhile in the Pacific: "Japan – Underwater Supervolcano Stirring to Life"

First up, an FT-style headline:
Underwater supervolcano could erupt without warning and kill 100 million people after scientists find a 6-mile wide lava dome growing off the coast of Japan
Just kidding. 
Wary yet curious reader undoubtedly knows that is definitely not the Financial Times and recognizes tabloid-style, in this case the Daily Mail, Feb. 13.
Continuing:
  • Japanese researchers have found evidence of a giant dome containing lava
  • The dome lies within the mostly submerged Kikai Caldera south of Kyushu Island
  • A researcher says the lava dome could kill up to 100 million people if it erupts
  • But the risk of a caldera eruption hitting Japan is just 1% in the next 100 years
A submerged volcano off the coast of Japan that erupted 7,300 years ago could be preparing to make a comeback.  

Scientists have discovered evidence of a giant dome of lava in the Kikai volcano's collapsed magma chamber.

They believe it contains about 32 cubic km (7.68 cubic miles) of magma, and distortions on its surface suggest the dome is growing.

Currently the dome is around  6.2 miles (10 kilometers) wide and 1,968 feet (600 meters) tall. 
Scientists say an eruption could take place without warning, and if it does, it could kill as many as 100 million people and trigger a 'volcanic winter'....MORE
Here's the paper published online by Nature, February 9th:

Giant rhyolite lava dome formation after 7.3 ka supereruption at Kikai caldera, SW Japan
Received:
Accepted:
Published online:
Abstract


Kikai submarine caldera to the south of the Kyushu Island, SW Japan, collapsed at 7.3 ka during the latest supereruption (>500 km3 of magma) in the Japanese Archipelago. Multi functional research surveys of the T/S Fukae Maru in this caldera, including multi-beam echosounder mapping, remotely operated vehicle observation, multi-channel seismic reflection survey, and rock sampling by dredging and diving, provided lines of evidence for creation of a giant rhyolite lava dome (~32 km3) after the caldera collapse. This dome is still active as water column anomalies accompanied by bubbling from its surface are observed. Chemical characteristics of dome-forming rhyolites akin to those of presently active small volcanic cones are different from those of supereruption. The voluminous post-caldera activity is thus not caused simply by squeezing the remnant of syn-caldera magma but may tap a magma system that has evolved both chemically and physically since the 7.3-ka supereruption.
Introduction
Supereruptions leading to the huge caldera collapse are rare but extremely hazardous events, and also have severe global impacts such as ‘volcanic winter’1,2. Many of these supervolcanoes repeat supereruptions in their multi-million year histories3,4,5,6,7. Although the volcanic activity is relatively quiet during the intervening periods between supereruptions, the post-caldera activity should provide a key to understanding the evolution of magma-plumbing system in the whole caldera cycle. The reason for believing so is that dynamic activities in this period such as formation of resurgent domes, i.e., uplift of the caldera floor by extensive magmatic intrusions, and volcanic cones may represent processes of not only calming down from the climactic eruption but also preparation for the next supereruption....

For orientation, here's the map from the Kobe University press release showing the location of the caldera just off the southernmost main island, Kyushu: 

***

And a slightly more tabloid-ish image from Photovolcanica:
http://www.photovolcanica.com/VolcanoInfo/Kikai/AkahoyaEruption.jpg

Climateer Line of the Day: Elon's Relationship With Reality Edition

Today's winner of the prestigious CLoD is the engineer-creator of WhereIsRoadster.com:
...After the launch, Pearson started modeling where the car could be in space, but his calculations didn’t match the orbit Musk had released. How did he feel when he found out he was right and Elon Musk was wrong? “I was just relieved to know that I wasn’t doing anything critically wrong,” Pearson says.
“Elon Musk is a visionary man, incredibly far forward, but there’s a reality distortion field when it comes to him.”
...much more at The Verge: "Track Elon Musk’s Tesla Roadster in space with this aptly named website"

Consequences, Intended and Otherwise: "Make The Rest of the World Great Again"

From the Council on Foreign Relations:

Trump’s Tax Success Is at the Expense of His Trade Agenda
It looks like a combination of tax cuts and spending increases will raise the U.S. fiscal deficit by about 2 percentage points of GDP (that’s the number Krugman used; Goldman’s US economics team puts the increase in the fiscal deficit between fiscal 2017 and fiscal 2019 at 1.7 percent of GDP). The IMF’s standard coefficient relating changes in the fiscal balance to changes in the external balance would imply that the U.S. current account deficit will increase by about a percentage point of GDP—so rise to around 4 percent of GDP.

There are a few reasons to think that this might be a bit high.

The U.S. is globally speaking, a relatively closed economy. Imports have increased at about a quarter of the pace of domestic demand over the course of the recovery from the global (or north Atlantic) crisis. So the external spillovers from a U.S. fiscal stimulus might be smaller than the global norm. *
A high portion of the tax cut will go toward buybacks, special dividend payments, and the like, and a high portion of those payments may be saved not spent. This isn’t a fiscal stimulus designed for maximum impact on demand.

And, well, the IMF’s coefficients have a whole lot of implicit assumptions baked into them—assumptions that may not hold this time. In most cases a fiscal loosening changes the stance of monetary policy, and those changes in the stance of monetary policy in turn drive some change in the exchange rate. But, if the Fed doesn’t end up tightening more, or if the dollar doesn’t in fact appreciate as the Fed tightens, the impact of the fiscal expansion on the trade deficit may be smaller than the simple application of the IMF’s model would predict.

But there are a couple of factors that could work the other way too.

The closer the economy is to operating at capacity, the more the demand created by the stimulus may bleed out to the rest of the world. That is arguably what happened in q4 of 2017. Domestic demand growth accelerated, with the contribution from demand to GDP growth rising from around 2.5 percent to above 3.5 percent. But an unusually big chunk of that was spent on imports—over 50 percent. **
Contributions to U.S. GDP Growth: Demand Versus Exports
If that pattern continues, The U.S. would get stuck with the debt while the United States’ big trading partners would get the stimulus. A poorly timed fiscal expansion thus could end up making China, Korea, Japan, Germany, and the other big exporting economies great.
Aside from trade there is an “income” channel. Or more specifically, a “higher interest rate on a big stock of external debt” channel....
...MORE

HT: the attached note says FTAV twitter sidebar Feb-16 but I am at a loss to say whose tweet, apologies to the tipster.

"India may get thrown out of MSCI Indices"

It's a few steps between here and there but is a possibility.

Via Alpha Ideas, Feb. 16:
MSCI Inc. (NYSE: MSCI), a leading provider of research-based indexes and analytics, announced today that it is closely monitoring developments related to the concerted announcement by three Indian stock exchanges, including the two principal exchanges, of the imposition of anti-competitive measures restricting the accessibility of the Indian equity market.

MSCI is evaluating the measures’ potential impact on existing financial products and the future accessibility of the Indian equity market for international institutional investors more generally.
In a clearly negative development for the accessibility of the Indian equity market for international institutional investors, the exchanges’ announcement made on February 9, 2018 would impose, following the expiration of contractual notice periods, a set of restrictions on the use of traded price data inconsistent with the practices of any other market in MSCI’s Emerging Markets Index series and could result in an unprecedented disruption of trading in financial products in markets around the world.

Based on the exchanges’ press release, we understand that the exchanges do not seek to impose a precipitous or disorderly wind down of the various products that would be affected in many markets around the world.

Nonetheless, given the breadth of the application of the changes referred to in the announcement, we believe that if the changes are put into effect, the result will be disruptive and harmful to international institutional investors in Indian equities whether accessing the market onshore or offshore....
...MORE

"Perpetual Dual-Class Stock: The Case Against Corporate Royalty"

The author is a commissioner on the SEC and a recovering academic.
(enough footnotes to make Matt Levine envious)

From Columbia Law School's Blue Sky Blog:
My first few weeks at the Securities and Exchange Commission have been a whirlwind—and just to be clear, I am not talking about the markets.[1] In a few short weeks, I have gotten a crash course on SEC policymaking—and enough reading to empathize with my former law students, who used to tell me, to my puzzlement, that my Corporate Law syllabus was not exactly beach material.

But in between the policy memos that come across my desk, I’ve also had the pleasure of working with my new colleagues on the SEC’s Staff. They’ve taught me a lot in a short time, and I’m grateful for their insights and assistance. The hard work and dedication of these folks gives me confidence that we are up to the challenge of making sure our financial markets are the safest, strongest, and most efficient in the world.

So the first few months of 2018 have been quite a blur. Fortunately, they have not been as stressful for me as the last few months of 2017.

You see, last fall, I took part in two of the most nerve-wracking Q&A sessions of my life. In late October, I had the ultimate job interview: a two-hour, televised confirmation hearing in front of the Senate Banking Committee.[2] Then, two months later, I found myself the one posing the life-changing questions. I asked my girlfriend Bryana to marry me.

I’m happy to report that, to my surprise, both Bryana and the Senate offered a resounding yes—literally within 24 hours of each other. But, let me just say, I now have newfound respect for the staff and Senators on the Committee. I only had to ask one question, and it nearly gave me a heart attack.
Now, as a newly engaged guy, I fully embrace the notion that a strong marriage must be built on a foundation of eternal trust. But today, I would like to ask whether it is wise to apply that standard to corporate governance. Should our public investors have to place eternal trust in corporate insiders? That is, should so-called perpetual dual-class stock ownership structures, which grant corporate executives control of our public companies literally forever, be acceptable?

Before I get started, let me just note that the views I express here are my own and do not reflect the views of the Commission. (Although, I’ll confess, I hope someday that they do.)

The Law and Legacy of Dual-Class Stock
As you know, “dual class” voting typically involves capitalization structures that contain two or more classes of shares—one of which has significantly more voting power than the other. That’s distinct from the more common single-class structure, which gives shareholders equal equity and voting power. In a dual-class structure, public shareholders receive shares with one vote per share, while insiders receive shares that empower them with multiple votes. And some firms have recently issued shares that give ordinary public investors no vote at all.[3]

For most of the modern history of American equity markets, the New York Stock Exchange did not list companies with dual-class voting. That’s because the Exchange’s commitment to corporate democracy and accountability dates back to before the Great Depression.[4] But in the midst of the takeover battles of the 1980s, corporate insiders “who saw their firms as being vulnerable to takeovers began lobbying [the exchanges] to liberalize their rules on shareholder voting rights.”[5] Facing pressure from corporate management and fellow exchanges, the NYSE reversed course, and today permits firms to go public with structures that were once prohibited.[6]

As you all know well, more and more companies choose today to go public with dual-class. Public companies using dual-class are today worth more than $5 trillion, and more than 14% of the 133 companies that listed on U.S. exchanges in 2015 have dual-class voting.[7] That compares with 12% of firms that listed on U.S. exchanges in 2014, and just 1% in 2005. [8]

There’s a long-running debate on dual-class. On one hand, you have visionary founders who want to retain control while gaining access to our public markets. On the other, you have a structure that undermines accountability: management can outvote ordinary investors on virtually anything.
There is reason to think that, at least for a defined period of time early in a company’s life, dual-class can be beneficial. The structure can allow entrepreneurs to build for the long term—and even transform entire industries—without being subject to short-term pressure.[9] When many managers are at the mercy of daily stock-market pressure, dual-class can help America’s most innovative companies create the sustainable long-term value we need to grow our economy.[10]

Many have argued forcefully, however, that one-share, one-vote should be the rule for all public corporations.[11] Whatever the benefits may be of permitting dual-class in a few well-known cases, these advocates argue, the costs for investors—who are left with no way to hold management’s feet to the fire while dual-class is in place—outweigh those benefits....MORE

Facebook Goes Old School

From Reuters:

Facebook plans to use U.S. mail to verify IDs of election ad buyers
Facebook Inc will start using postcards sent by U.S. mail later this year to verify the identities and location of people who want to purchase U.S. election-related advertising on its site, a senior company executive said on Saturday. 

The postcard verification is Facebook’s latest effort to respond to criticism from lawmakers, security experts and election integrity watchdog groups that it and other social media companies failed to detect and later responded slowly to Russia’s use of their platforms to spread divisive political content, including disinformation, during the 2016 U.S. presidential election. 

Facebook revealed the plans a day after U.S. Special Counsel Robert Mueller unsealed an indictment accusing 13 Russians and three Russian companies of conducting a criminal and espionage conspiracy using social media to interfere in the election by boosting Republican Donald Trump and denigrating Democratic candidate Hillary Clinton. 

The process of using postcards containing a specific code will be required for advertising that mentions a specific candidate running for a federal office, Katie Harbath, Facebook’s global director of policy programs, said. The requirement will not apply to issue-based political ads, she said....MORE

Econ: "The Real Adam Smith"

From Aeon:

He might be the poster boy for free-market economics, but that distorts what Adam Smith really thought
If you’ve heard of one economist, it’s likely to be Adam Smith. He’s the best-known of all economists, and is typically hailed as the founding father of the dismal science itself.
Furthermore, he’s usually portrayed as not only an early champion of economic theory, but of the superiority of markets over government planning. In other words, Smith is now known both as the founder of economics, and as an ideologue for the political Right.

Yet, despite being widely believed, both these claims are at best misleading, and at worst outright false.

Smith’s popular reputation as an economist is a remarkable twist of fate for a man who spent most of his life as a somewhat reclusive academic thinker. Employed as professor of moral philosophy at the University of Glasgow, the majority of Smith’s teaching was in ethics, politics, jurisprudence and rhetoric, and for most of his career he was known for his first book, The Theory of Moral Sentiments (1759). His professional identity was firmly that of a philosopher – not least because the discipline of ‘economics’ didn’t emerge until the 19th century, by which time Smith was long dead. (He died in July 1790, just as the French Revolution was getting into full swing.)

Admittedly, Smith’s reputation as an economist isn’t entirely mysterious. His oft-quoted An Inquiry into the Nature and Causes of the Wealth of Nations (1776) was undoubtedly important in the eventual formation – in the next century – of the discipline of economics. But even here things are not as straightforward as they appear. For The Wealth of Nations – a 1,000-page doorstopper that blends history, ethics, psychology and political philosophy – bears little resemblance to the ahistorical and highly mathematical nature of most current economic theory. If anything, Smith’s best-known book is a work of political economy, a once-prevalent field of enquiry that suffered a striking decline in the latter half of the 20th century.

Smith’s reputation, however, began to get away from him early on. Shortly after publication, The Wealth of Nations was fêted in the British Parliament by the Whig leader Charles James Fox. Ironically, Fox later admitted that he had never actually read it (few subsequent non-readers of the book have showed such candour, despite plenty of them citing it). Indeed, Smith suspected that those quickest to sing his praises had failed to understand the main arguments of his work. He later described The Wealth of Nations as a ‘very violent attack … upon the whole commercial system of Great Britain’. Despite this, his vocal political cheerleaders in Parliament continued to prop up the very system that Smith was railing against.

Yet if Smith was disappointed by his work’s immediate reception, he would likely have taken even less cheer from the future uses to which his name would be put. For it has been his fate to become associated with the strain of Right-wing politics that rose to dominance in the early 1980s, and which continues to exert a strong influence on politics and economics today. Usually known as neoliberalism, this development is most famously associated with Ronald Reagan and Margaret Thatcher. But it is in fact a movement with deep intellectual roots, in particular in the mid-century writings of the economists Friedrich Hayek and Ludwig von Mises. Later, the Chicago economist Milton Friedman and the British policy adviser Keith Joseph championed it during the 1980s, as did the extensive network of academics, think tanks, business leaders and policymakers associated with the Mont Pelerin Society.

Neoliberals often invoke Smith’s name, believing him to be an early champion of private capitalist endeavour, and a founder of the movement that seeks (as Thatcher hoped) to ‘roll back the frontiers of the state’ so as to allow the market to flourish. The fact that there is a prominent Right-wing British think tank called the Adam Smith Institute – which since the 1970s has aggressively pushed for market-led reforms, and in 2016 officially rebranded itself a ‘neoliberal’ organisation – is just one example of this tendency.

It is certainly true that there are similarities between what Smith called ‘the system of natural liberty’, and more recent calls for the state to make way for the free market. But if we dig below the surface, what emerges most strikingly are the differences between Smith’s subtle, skeptical view of the role of markets in a free society, and more recent caricatures of him as a free-market fundamentalist avant-la-lettre. For while Smith might be publicly lauded by those who put their faith in private capitalist enterprise, and who decry the state as the chief threat to liberty and prosperity, the real Adam Smith painted a rather different picture. According to Smith, the most pressing dangers came not from the state acting alone, but the state when captured by merchant elites.

The context of Smith’s intervention in The Wealth of Nations was what he called ‘the mercantile system’. By this Smith meant the network of monopolies that characterised the economic affairs of early modern Europe. Under such arrangements, private companies lobbied governments for the right to operate exclusive trade routes, or to be the only importers or exporters of goods, while closed guilds controlled the flow of products and employment within domestic markets.

As a result, Smith argued, ordinary people were forced to accept inflated prices for shoddy goods, and their employment was at the mercy of cabals of bosses. Smith saw this as a monstrous affront to liberty, and a pernicious restriction on the capacity of each nation to increase its collective wealth. Yet the mercantile system benefited the merchant elites, who had worked hard to keep it in place. Smith pulled no punches in his assessment of the bosses as working against the interests of the public. As he put it in The Wealth of Nations: ‘People of the same trade seldom meet together, even for merriment and diversion but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.’

The merchants had spent centuries securing their position of unfair advantage. In particular, they had invented and propagated the doctrine of ‘the balance of trade’, and had succeeded in elevating it into the received wisdom of the age. The basic idea was that each nation’s wealth consisted in the amount of gold that it held. Playing on this idea, the merchants claimed that, in order to get rich, a nation had to export as much, and import as little, as possible, thus maintaining a ‘favourable’ balance. They then presented themselves as servants of the public by offering to run state-backed monopolies that would limit the inflow, and maximise the outflow, of goods, and therefore of gold. But as Smith’s lengthy analysis showed, this was pure hokum: what were needed instead were open trading arrangements, so that productivity could increase generally, and collective wealth would grow for the benefit of all....MORE

Saturday, February 17, 2018

"The random walk of cars and their collision probabilities with planets"

Initial conditions - very important. Just ask grandmother.*
From the Physics arXive at Cornell:

Astrophysics > Earth and Planetary Astrophysics

The random walk of cars and their collision probabilities with planets
On February 6th, 2018 SpaceX launched a Tesla Roadster on a Mars crossing orbit. We perform N-body simulations to determine the fate of the object over the next several million years, under the relevant perturbations acting on the orbit. The orbital evolution is initially dominated by close encounters with the Earth. The first close encounter with the Earth will occur in 2091. The repeated encounters lead to a random walk that eventually causes close encounters with other terrestrial planets and the Sun. Long-term integrations become highly sensitive to the initial conditions after several such close encounters. By running a large ensemble of simulations with slightly perturbed initial conditions, we estimate the probability of a collision with Earth and Venus over the next one million years to be 6% and 2.5%, respectively. We estimate the dynamical lifetime of the Tesla to be a few tens of millions of years.
Comments: 5 pages, 4 figures, to be submitted to MNRAS, comments welcome
Subjects: Earth and Planetary Astrophysics (astro-ph.EP)
Cite as: arXiv:1802.04718 [astro-ph.EP]
(or arXiv:1802.04718v1 [astro-ph.EP] for this version)

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*Grand mother was last sighted/cited in Feb. 6's "Mr. Macho Market Man Says: "Parachute? We Don' Need No Stinkin' Parachute"":
Grandmother would say something like "If the initial condition given is 'The sky is falling', your course of action would be to short sky, try the eggplant"
The long version, also re: trajectories, 2013's:

The Future Price Trajectory of Copper and Aluminum and the Implications for Oil
In Which Our Hero Explains the Importance of Recent Events and Their Impact on the Cost of Day-to-Day Living
...For me it was how to approach the profit possibilities; much in the same way Grandmother would quiz: "Your initial conditions are 'The sky is falling, the sky is falling', what is your course of action?" to which I'd reply "I'm this many: ||||, four" and she'd say, "No silly, your course of action is 'Short sky'"

Mr. Musk's Falcon Heavy is an Absurdly Low-cost Heavy Lift Rocket

From Ars Technica:

The new SpaceX rocket seriously undercuts its competitors.

https://cdn.arstechnica.net/wp-content/uploads/2018/02/FalconHeavy1-980x724.jpg
 Twenty-seven engines on the Falcon Heavy rocket, all burning their happy little flames.
One may criticize the Falcon Heavy rocket for having a short launch manifest, as it has only two confirmed flights in the next year or so. There just aren't that many commercial customers right now for the heavier-lift rocket when a cheaper Falcon 9 or another medium-lift class of booster will suffice. But when one considers the more extreme cases—such as big Department of Defense missions to geostationary orbit or potential human exploration plans—the Falcon Heavy shines.

Now that SpaceX's new rocket is finally flying, we can directly compare costs between this new booster and an existing rocket in its class, the Delta IV Heavy, as well as NASA's upcoming heavy lift booster, the Space Launch System. And upon direct comparison, the cost disparities are sobering, proving that commercial development of large rockets likely represents the future of the industry.

Delta IV Heavy
The Falcon Heavy rocket, with reusable side boosters, costs $90 million. For a fully expendable variant of the rocket, which can lift a theoretical maximum of 64 tons to low-Earth orbit, the price is $150 million. While it is not certified yet, SpaceX says its rocket can hit all Department of Defense reference orbits; however big and gnarly the military wants to build its satellites, and whatever crazy orbit it wants to put them into, the Falcon Heavy can do it.

Only the Delta IV Heavy rocket, manufactured by the United Launch Alliance, also has this capability today. It is more expensive, but how much more is a matter of some debate. On Twitter this week, the chief executive of the Colorado-based rocket company, Tory Bruno, said the Delta IV Heavy costs about $350 million per flight. This figure, however, is strikingly lower than what Bruno cited during a congressional hearing in 2015, when he asserted that, "A Delta IV, depending on the configuration, costs between $400 and $600 million dollars."

Moreover, the costs referenced above by Bruno exclude a "launch capability contract" worth about $1 billion annually, which the US government pays exclusively to United Launch Alliance. Based upon current law, this contract payment will phase out in 2019 (for Atlas rockets) and 2020 (for Delta rockets), which should increase the costs allocated to each mission. Finally, in 2019, United Launch Alliance will make the last flight of a Delta IV Medium rocket. Once this variant is retired, all of the Delta's fixed costs will fall on the Heavy variant. This will push the per-flight cost above $600 million, and perhaps considerably higher, in the early 2020s.

The bottom line is that the Falcon Heavy is a more powerful rocket than the Delta IV Heavy, and by various measures the latter will probably soon cost the US government about five times as much. Put another way, the Department of Defense may have to pay half a billion dollars more for a single launch of certain military satellites on the Delta IV Heavy versus the Falcon Heavy....MUCH MORE