Monday, August 31, 2020

Cambridge Tech Grandee Hermann Hauser Says Selling ARM to Nvidia Would Be a Disaster

Dr. Hauser is one of the poobahs of BritTech and was part of the team that spun ARM out of Acorn Computers in 1990.
From The Cambridge Independent, August 27:

Hermann Hauser: Three reasons why the sale of Arm to Nvidia would be a disaster
Hermann Hauser has said the potential sale of Arm Holdings to Nvidia would be a disaster for Cambridge and the UK - and would fuel the trade war between the US and China.
He has called on the UK government to intervene and revealed that he had spoken to the London Stock Exchange about the idea of taking Arm public.

Talking to the Cambridge Independent from his farm in New Zealand, where he spends the UK winters and has remained during the coronavirus pandemic, Dr Hauser said the country’s technology sovereignty is at stake in the proposed deal.

It was in 1990 that he spun out the Cambridge-based chip designer from Acorn.
Today, the company is behind the technology used in virtually all smartphones.
It was acquired in 2016 for $32billion by Japanese conglomerate Softbank, which posted a $12.7billion loss for the year ending March 31 - its first loss in 15 years.

Softbank is understood to be in talks about selling on Arm to US-based Nvidia , which last month took over Intel as the world’s most valuable chip company - and now boasts a market capitalisation that has soared over £300billion.

“It will be a disaster for three main reasons,” said Dr Hauser. “The most pertinent to Cambridge is the job losses that will inevitably go with moving headquarters to Silicon Valley.
“Nvidia, of course, bought Icera from Bristol in 2011 and there were about 300-plus people.”

That $367million acquisition was intended to help Nvidia engage with the smartphone revolution. Instead, the company announced it was closing down Icera in 2015.

“I wouldn’t expect Nvidia to sack all Arm people, but if the centre of gravity moves to Silicon Valley, inevitably Cambridge will reduce in importance, and there are good designers in Silicon Valley too. That’s the first problem....

As mentioned a few times over the years, Her Majesty should have put the Royal foot down and quashed the sale to SoftBank. Here's 2019's:
"SoftBank mulls IPO of $100 billion Vision Fund"
Crap. As we've said on these pages a few times, a cash crunch to force the re-listing of ARM Holdings would have been nice....
....The RCEWA should have figured out how to designate ARM as an Object of Cultural Interest pursuant to the 2002 Export Control Act.
Or something.
Oh well, the RCEWA did keep T.L Lawrence's dagger in British Hands.
And previously on the idea of ARM going to NVIDIA, August 11's: "Nvidia Buying Arm Would be Reckless" has a few links including two from the electrical engineering types at EE Times.

"Commerce and Politics at Sea"

From the Los Angeles Review of Books, August 22, 2020:

HOW CENTRAL IS SHIPPING to contemporary capitalism and trade?
The introduction to Laleh Khalili’s new book, Sinews of War and Trade: Shipping and Capitalism in the Arabian Peninsula, makes clear why focusing on maritime trade is no mere niche pursuit: 90 percent of the world’s goods travel by ship. Also, at the very outset, Khalili shows that, on the map of global trade today, it is China that takes center-stage as the factory of the world — and the oil that fuels China’s manufacturing derives primarily from the Arabian Peninsula.

Khalili focuses on the huge maritime infrastructures that have evolved in response to the internationalization of capital and the commodification of oil, with a specific focus on the Arabian Peninsula. The central thesis of her book is that “maritime transportation is not simply an enabling adjunct of trade but is central to the very fabric of global capitalism.” As she powerfully argues:

Maritime trade, logistics, and hydrocarbon transport are the clearest distillation of how global capitalism operates today. The maritime transport enterprise displays this tendency through its engineering of the lived environment: transforming “natural” features of the world into juridical ones, creating new spaces, structures and infrastructures that aim at (though rarely achieve) frictionless accumulation and circulation of capital; creating fictive commodities, financial fetishes, and ever more innovative forms of speculation; and creating racialised hierarchies of labour.

Reading the book certainly feels like an adventure at times. Khalili draws on sources as diverse as the India Office Records, the UK Maritime Museum archives, and the British Petroleum archives, among others, as well as newspapers, trade magazines, memoirs, and novels. She has visited most of the main cargo points of the Arabian Peninsula and has traveled on two different container ships. The book does drag at times — such as when Khalili describes the technical aspects of ship routes or procedures — but even those occasional dull passages are enlivened by Khalili’s sharp, clear prose.
The book is filled with interesting insights. Consider, for example, Khalili’s concise exposition of the fraught history of the Suez Canal, which was constructed by Egyptian peasants pressed into corvée labor, and which allowed Britain to consolidate power over its Asian colonies. The canal became the preferred route for Europeans regularly traveling to India, among them British colonial officials and military officers. Moreover, the Suez Canal also gave Britain the upper hand when it came to Egypt. For example, when the loans borrowed to finance the construction of the canal came due, “the British used the Egyptian debt along with the ‘threat’ of [a] Urabi revolt to occupy the country militarily. In so doing, Britain secured its hold over the entirety of the route to India.”

Khalili highlights the widespread incursion of financial imperatives. Alongside the possibility of speculating on agricultural or energy commodities, traders also speculate on the future price of sea routes, using an index that tracks the specific costs of freight on a given route. Another fascinating discussion deals with the weaponization of “legal apparatuses, doctrines, and rules” and the associated strategic maneuvering involved in the protection of alien property overseas — a discussion that serves as a backdrop for an analysis of maritime arbitration cases. As Khalili argues:

The expropriations of foreign property that followed the Bolshevik Revolution of 1917 and the Mexican nationalization of foreign petroleum companies in 1938 provided the impetus in Western Europe and North America to develop complex legal apparatuses, doctrines and rules to protect the alien property of North American and European investors and firms....

Russia’s Pacific Fleet Conducts Drills Near Alaska

“They’re our next-door neighbors, and you can actually see 
Russia from land here in Alaska, from an island in Alaska”
—Sarah Palin, Vice Presidential candidate, ABC News interview, 2008-09-11

They're a whole lot closer than that.
From Forbes, August 28:

Russian Navy Submarine Surfaces Off Alaska; Likely Same One That Fired Cruise Missile Earlier In Exercise
A Russian submarine reported off the Alaskan coast on Thursday is likely to be the same one that fired a cruise missile in a naval exercise. U.S. Northern Command (USNORTHCOM) stated that the submarine surfaced and is being monitored by U.S. forces. It may have surfaced because of an emergency. And it is not the only unusual Russian Navy submarine movement that has caught analysts’ attention.

U.S. officials said the submarine was taking part in a Russian military exercise. A Russian state media report (in Russian) on the exercise said the submarine ‘Omsk’ fired a cruise missile at a target in the Bering Sea, which is between Siberia and Alaska.

The circumstances of the surfacing are unclear. It is not normal for submarines to come to the surface near another country's coast. USNORTHCOM’s statements on Twitter raise questions as to whether something is wrong: “We have not received any requests for assistance from the Russian Navy or other mariners in the area. We always stand ready to assist those in distress.” This may imply that there is an emergency aboard which the U.S. Navy is aware of....
 “Russia, this is, without question, our number one geopolitical foe” 
—Mitt Romney, Presidential candidate, CNN interview, March 26, 2012 

"Gov. Romney, I'm glad you recognize al-Qaida is a threat, because a few months ago when you were 
asked what is the biggest geopolitical group facing America, you said Russia, not al-Qaida" "You said Russia. 
And the 1980s are now calling to ask for their foreign policy back. Because  the Cold War has been over for 20 years....
President Barack Obama to Romney, third presidential debate, October 22, 2012.

"What Part Does France Play In European Politics?"

Not as much as they should.
On the other hand, France seems to be the only EU country with the guts to tell Turkey's Erdoğan:
"No you are not the Sultan and Cyprus is not part of your Caliphate."

From ValueWalk, August 31:
France has been a major player in world and European politics for centuries. However, in recent years, the country has made moves to re-establish itself as one of the most significant powers in both Europe and around the globe.
As France continues to assert its soft power around the continent and the world at large, this article looks at how the part the country plays in European politics. It examines how the country operates within the European Union and how it contributes to the workings of Europe as a whole.

What Role Does France Play in the EU?
France is one of the founding members of the European Union (EU). It has been a member of the alliance since helping to form its precursor organization, the European Coal and Steel Community, in 1951.

French is one of the official languages of the Union and the country sits at the forefront of many European affairs. As one of the nations in the organization with the strongest militaries and a substantial economy (France has the world’s 7th highest GDP and the 2nd highest in Europe after Germany), it has a major say in the direction of the 27 country body.

This has only increased under the rule of the incumbent French president: Emmanual Macron. Macron’s presidency has been marked by his efforts to increase the profile of France in both Europe and the world as a major player in decision-making....

Okay, that's a rather lightweight overview but it gives me an excuse to post this from Reuters, August 28:
France's Macron says he set red lines with Turkey in eastern Mediterranean

"Elephant poacher sentenced to 30 years in Congo prison"

From News Corp. August 28:

It’s the first time the criminal court in the central African country has sent a poacher to prison.
A Congolese elephant poacher believed to have been responsible for the killing of as many as 500 of the vulnerable species in the past 12 years has become the first person sent to jail for doing so in the Central African country.

Mobanza Mobembo Gerard, also known as Guyvanho, was found guilty by the criminal court of the Republic of Congo last week.

Local authorities investigating his crimes found he led a team of more than two dozen poachers....

A couple other stories of law & justice from 2019:

Rhino poacher trampled to death by elephant before being devoured by pride of lions 
The charismatic megafauna that plays together stays together.

From Scallywag and Vagabond, Apr. 6: 

Rhino poacher trampled to death by elephant before being devoured by pride of lions at South Africa’s Kruger National Park. Accomplices charged with illegal hunting.
A rhino poacher seeking prey in South Africa’s Kruger National Park has been killed after being trampled to death by an elephant before being eaten by a pride of lions leaving behind his skull and a pair of pants. 
Three of the man’s friends ran away after the victim was crushed by the elephant and rang his family....  
‘…this sends out a powerful message to poachers that you will not always be the winner’.

In an unrelated case via SA Breaking News, Apr. 6:
Grahamstown Rhino Poachers sentenced to more than 500 years

And an older story from Scallywag and Vagabond:
Orphaned baby rhino attempts to make grey jeep his new mom.

"Scotland: World's most expensive sheep sold for £367,500"

From PoandPo Agrifish, August 29:

The world’s most expensive sheep was sold in Scotland for £367,500 ($490,625), PA Media reported Friday.
Double Diamond was sold Thursday at the Scottish National Texel sale in Lanark. The pedigree Texel ram lamb was sold by Charlie Boden and his family, whose flock is in Stockport, Cheshire.

The initial opening bid was £10,500 ($14,018), but quickly increased. The buyers were a partnership of three farmers.

“He is the best lamb I have ever seen – so correct on his legs, bright, with a great top. He’s got it all,” said buyer Jeff Aiken....

Blah, blah, blah. We know why they bid up the little stud:

Also in Scotland, let's hope they keep better track of him than these folks did of their fish:
Nearly 50,000 salmon escape from Scottish fish farm

Don't be lettin' the farmed fish mix with the wild ones.

Ummm...Who Had "Invasive Jumping Earthworms" For September?

From WRTV, Indianapolis:

Expert says invasive ‘jumping’ earthworms with destructive potential appearing in Western New York
University at Buffalo earthworm expert Nick Henshue says Amynthas, invasive "jumping" earthworms with destructive potential, are appearing in the Western New York area.

The earthworms live in the top few inches of soil, can grow to about the length of a pencil and gobble up fallen leaves that experts say play a vital role in forest ecosystems.

Henshue believes the invasive earthworms may have been transported to the area in part via contaminated mulch....

"The Post-Covid, Tech-Enabled Office In 2 Graphics"

From CB Insights, August 27:
From autonomous cleaning devices to tighter cybersecurity measures, we illustrate the technologies influencing how the office could look during the reopening process and beyond.
Outbreak prevention, worker safety, and employees’ peace of mind will be top concerns for businesses around the world as they begin to reopen their office doors in the wake of the Covid-19 pandemic.
A host of technologies are emerging to help address these concerns, in turn shaping the future of the office space.....

"WHO Special Envoy Heaps Praise on Sweden’s Covid Strategy"

From Bloomberg:
One of the World Health Organization’s six special envoys on Covid-19 has highlighted Sweden’s virus response as a model that other countries should be emulating in the long run.

Dr. David Nabarro, speaking in a radio interview with Magic Talk in New Zealand, said, “For all countries, the real approach we’ve got to aim for is through behavior that’s adopted everywhere.”

Nabarro said the key to a sustainable coronavirus strategy is trust, and pointed to Sweden as a case in point. The Nordic nation imposed far fewer restrictions on movement than others, and instead relied on Swedes to act responsibly and embrace the guidelines laid out by the country’s health authorities.
“In Sweden, the government was able to trust the public and the public was able to trust the government,” Nabarro said.

To be sure, Sweden’s Covid-19 death rate is considerably higher than in many other countries, at 57 per 100,000. But the pace of new infections and deaths has slowed markedly since the end of June. The development prompted Sweden’s national health agency to propose raising the limit on certain public gatherings to 500 people from 50.

In contrast, other governments around the world are once again imposing stricter measures amid a resurgence in cases.

Nabarro described a lockdown as “a blunt instrument” that “really bites into the livelihoods of everybody, particularly poorer people and small businesses.”....

U.S. Army Mad Scientist Laboratory: "The Convergence—Political Tribalism and Cultural Disinformation with Samantha North"

Stuff the military is thinking about.
From the Mad Scientist Lab blog, August 6:
Editor’s Note: Mad Scientist Laboratory is pleased to announce our latest episode of “The Convergence” podcast, featuring Samantha North, disinformation analyst and doctoral candidate, discussing political tribalism online and our susceptibility to disinformation. Please note that this podcast and several of the embedded links below are best accessed via a non-DoD network due to network priorities for teleworking — Enjoy!]

In this latest episode of “The Convergence,” we talk with Samantha North, cyber investigator and consultant, who is completing the final year of a PhD in computational social science at the University of Bath. Ms. North’s research focuses on understanding the drivers of tribalism in online political behavior, using data science methods to analyze large data sets and behavioral psychology theory to guide the interpretation. She also explores the factors that make social media users more susceptible to disinformation. Her objective is to understand what drives tribalism in online political behavior, using a mix of data science and behavioral psychology.

 In today’s podcast, Samantha North discusses political tribalism online and our susceptibility to disinformation:
  • People divide themselves into groups based on their similarities. Loyalties to these tribes increases self-esteem, and requires the designation and mistreatment of an outgroup. Disinformation targets these tribal divisions and attempts to amplify them. 
  • Despite the rise of fact-checking and counter-disinformation efforts, disinformation is still extremely effective, exposing the ease with which adversaries can exploit human cognitive biases. 
  • Disinformation tactics mirror digital marketing strategies. Thus, marketers and psychologists will be essential to understanding and combatting disinformation. 
  • Conspiracy theories, like those created in local, private Facebook groups, pose a bigger danger than individual fake news stories, as they create real-world grassroots action. 
  • Incentives for social media platforms to regulate disinformation based on tribalism are growing, especially as these trends are contributing to real-world actions.
  • The future of disinformation will probably include rises in “disinformation for money,” deepfakes, and malinformation (true information manipulated for nefarious or misdirecting purposes).
  • Campaigns to counter political tribalism cannot only fixate on foreign actors because there are homegrown groups also looking to inflame divisions. There must also be more of a focus on how conspiracy theories form over time, especially in small regional groups which have large grassroots impacts....

"Feral Cities"
Mad Scientist Blog: "Three Futurist Urban Scenarios"

Wolfgang Streeck Sees An Increasingly Chaotic and Violent System As Inevitable

Streeck is a German economic sociologist and emeritus director of the Max Planck Institute for the Study of Societies.
If you can plow through some of the econo-political rhetoric in this essay to the core ideas you get the sense he may be on to something.
From Open Democracy:

The post-capitalist interregnum
We are living through the dawn of a ‘post-capitalist interregnum’ – a prolonged period of social entropy, radical uncertainty and indeterminacy, in which society is essentially ungovernable and no new world order waits in the wings. Tracing the four-stage crisis sequence of neoliberal capitalism up to today’s disintegrating state system, he finds its crux in borderless Europe – and specifically Britain’s fateful referenda.

Capitalism was always a fragile and improbable order that depended on continuous repair work for its survival. Today, however, too many of its frailties have become acute simultaneously, while too many remedies to them have been exhausted or destroyed. Rather than picking one of the various manifestations of the crisis and privileging it over others, I suggest that all – or most – of them may add up to a condition of multi-morbidity, in which different disorders coexist and, more often than not, reinforce each other. The end of capitalism may, then, occur as a death from a thousand cuts – from multiple infirmities, each of which will become all the more untreatable as each will demand treatment at the same time.

In other words, I do not believe that any of the potentially stabilising forces frequently mentioned – be it regime pluralism, regional diversity and uneven development, political reform, independent crisis cycles or whatever – will be strong enough to neutralise the syndrome of accumulated weaknesses that characterises contemporary capitalism as a social order. No effective opposition being left, and no successor waiting in the wings of history, capitalism’s accumulation of defects – paralleling its accumulation of capital – amounts to an entirely endogenous dynamic of self-destruction, one that follows an evolutionary logic moulded but not suspended by contingent circumstances and coincidental events, along a historical trajectory from early liberal capitalism, via state-administered capitalism, to neoliberal capitalism which (for the time being) culminated in the financial crisis of 2008.

Towards social entropy
This is to say that for the decline of capitalism to continue, no revolutionary alternative is required, and certainly no masterplan of a better society that will displace or replace capitalism. Contemporary capitalism as a functioning social order is vanishing on its own account, collapsing from internal contradictions – not least as a result of having vanquished its enemies, who have often rescued capitalism from itself by forcing it to evolve into a new form. What will follow on from capitalism next will, I suggest, not be socialism or some other defined social order, but a long interregnum – no new world system equilibrium, but rather a prolonged period of social entropy; of radical uncertainty and indeterminacy. It is an interesting problem for sociological theory whether and (if so) how a society can turn for a significant length of time into less than a society – a post-social society, or a society lite – until it may or may not recover to again become a society in the full meaning of the term. I suggest that one can get a conceptual handle on this by drawing liberally on the distinction, introduced by David Lockwood back in 1964, between system integration and social integration, or integration at the macro and micro levels. An ‘interregnum’ would then be defined as a breakdown of macro-level system integration, depriving individuals at the micro-level of institutional structuring and collective support and shifting the burden of ordering social life, of providing it with a modicum of security and stability, to individual actors and such social arrangements as they can improvise on their own. A society in interregnum, in other words, would be a de-institutionalised or under-institutionalised society, one in which expectations can be stabilised only now and then by local extemporisation, and which for this very reason is essentially ungovernable.

A post-capitalist society would, then, appear to be one whose system integration is critically and irremediably weakened, so that the continuation of capital accumulation – for a final, intermediate period of uncertain duration – becomes dependent on the opportunism of collectively incapacitated individualised individuals, struggling to protect themselves from looming accidents in their social and economic lives. Undergoverned and undermanaged, the social world of the post-capitalist interregnum – in the wake of neoliberal capitalism’s neutralisation of states, governments, borders, trade unions and other moderating forces – can at any time be hit by disaster: bubbles may implode, for example, or violence penetrate from a collapsing periphery into the centre. With individuals deprived of collective defences and left to their own devices, what remains of a social order hinges on their motivation to co-operate ad hoc with other individuals, driven by elementary interests in individual survival and, often enough, fear and greed. As society loses its ability to provide its members with effective protection and proven templates of social action and social existence, individuals have only themselves to rely on while social order must depend on the weakest possible mode of social integration Zweckrationalität (or ‘instrumental rationality’).

As explained elsewhere, I anchor this condition in a variety of interrelated developments, including the intensification of distributional conflict as a result of declining growth; the rising inequality that results from this; vanishing macroeconomic manageability, as manifested in, among other things, steadily growing indebtedness, a pumped-up money supply, and the possibility of another economic breakdown at any time; the suspension of postwar capitalism’s engine of social progress, democracy, and the associated rise of oligarchy; the dwindling capacity of governments and the systemic inability of governance to limit the commodification of labour, nature and money; the omnipresence of corruption of all sorts, in response to intensified competition in winner-take-all markets with virtually unlimited opportunities for self-enrichment; the erosion of public infrastructures and collective benefits in the course of commodification and privatisation; the failure, after 1989, of capitalism’s carrier nation, the US, to build and maintain a stable global order; and so on and so on. These and other developments, I suggest, have resulted in widespread cynicism regarding political and economic life, forever ruling out a recovery of normative legitimacy for capitalism as a just society that offers equal opportunities for individual progress – a legitimacy that capitalism needs to draw on in critical moments.

Moving disequilibrium
In recent work I have argued that OECD capitalism has been on a crisis trajectory since the 1970s, the historical turning point being the abandonment of the postwar settlement by capital in response to a global profit squeeze. Subsequently, three crises followed one another: the global inflation of the 1970s, the explosion of public debt in the 1980s, and rapidly rising private indebtedness in the subsequent decade, resulting in the collapse of financial markets in 2008. This sequence was, by and large, the same for all major capitalist countries, whose economies have never nearly been in equilibrium since the end of postwar growth. All three crises began and ended in the same way, following the same political-economic logic: inflation, public debt and the deregulation of private debt started out as politically expedient solutions to distributional conflicts between capital and labour (and, in the 1970s, between the two and the producers of raw material whose cost had long been negligible), until they became problems themselves. Inflation begot unemployment as relative prices became distorted and owners of monetary assets abstained from investment; mounting public debt made creditors nervous and produced pressures for fiscal consolidation in the 1990s; and the pyramid of private debt that had filled the gaps in aggregate demand and citizen satisfaction caused by cuts in public spending imploded when the bubbles produced by easy money burst.

Solutions turned into problems requiring new solutions which, after another decade or so, became problems themselves; these problems called for yet other solutions that soon turned out to be as short-lived and self-defeating as their predecessors. Government policies vacillated between two equilibrium points, one political, the other economic, that had become impossible to attain simultaneously. Attending to the need for democratic political legitimacy and social peace, so as to live up to citizen expectations of economic prosperity and social stability, they found themselves at risk of damaging economic performance. Conversely, efforts to restore the economy to equilibrium tended to trigger political dissatisfaction and undermine support for the government of the day, and for the liberal-capitalist market economy in general. ...

Capital Markets: "Month-End Gyrations and the Fed's Ad Hocery"

 From Marc To Market:
Overview: Markets are searching for direction at month-end. Asia Pacific shares outside of Japan lower. Berkshire Hathaway confirmed taking a $6 bln stake in Japanese trading companies over the past year, and the pullback in the yen helped lift shares. The MSCI Asia Pacific Index rose 2% last week. European bourses are higher, and the Dow Jones Stoxx 600 is up around 0.4% near midday, while the S&P 500 is poised to gap higher, as it did last Monday. Debt markets are also mixed. European yields are 1-2 bp higher, while the US 10-year benchmark is about two basis points higher at 74 bp. The dollar is mostly higher, though the Norwegian krone and Canadian dollar are resisting the tug. Most of the liquid accessible emerging market currencies, led by the South African rand and the Mexican peso, are weaker. The JP Morgan Emerging Market Currency Index, which had rallied 1.2% before the weekend, is about 0.25% lower today. Gold is consolidating after rising 1.2% last week. The shuttered US Gulf oil and refinery capacity is offsetting news of two new oil and gas field finds in Saudi Arabia, and October WTI is firm near $43.50.

Asia Pacific
Deputy Prime Minister Aso will not replace resigning Prime Minister Abe.
Instead, Abe will remain in office until the LDP chooses a successor around the middle of September. LDP parliament members and local LDP chapters will select the next party head, who, by virtue of its parliamentary majority, would become the next PM. Before Abe, the office appeared to have a revolving door for several years. The current parliament term ends next October. It is possible that an interim compromise candidate completes Abe's term and allows the factions within the LDP to jostle and prepare for the post-Abe era. BOJ Governor Kuroda's term extends to April 2023. He may step down earlier, and a new Prime Minister would ostensibly give him he opportunity, though, without the extensive international travel schedule, Kuroda may feel more energetic to deal with the challenges of recovery. The fall in Tokyo's August inflation back below zero reminds us that the victory against deflation has not been secured.

It seemed kind of naive just to assume that Beijing was simply going to roll-over and allow Washington to arrange (and demand a fee!) for Tik-Tok to be sold (or banned from the US). Chinese officials waited until the end of last week to announce new export restrictions that would seem to cover some of the underlying technology used by Tik-Tok. The restrictions require an additional level of government approval. The list had not been altered since 2018. Changes have reportedly been discussed before, but it is clear that the current circumstances influenced its move that looks is designed to hamper Tik-Tok's sale. Beijing is willing to sacrifice Tik-Tok's US presence rather than capitulate to Washington's demand.

China's August PMI showed the recovery remains intact.
The manufacturing PMI slipped to 51.0 from 51.0. New orders rose to 52, while the contraction in export orders slowed. The service PMI rose to 55.2 from 54.2. These combined to lift the composite to 54.5 from 54.1.... 

Although Mr. Chandler doesn't mention it, today's most interesting action is in the U.S. treasury futures with both the 30-year and the 10-year resuming their downtrends.

Sunday, August 30, 2020

"China starts trial run of online int'l LNG trade" (plus Russia is shipping LNG to the UAE)

From Xinhua, August 28:
Shanghai Petroleum and Natural Gas Exchange (SHPGX), a national energy trading center, started the trial run of its online platform for international liquefied natural gas (LNG) trading on Friday.
China's oil giants Sinopec and CNOOC respectively reached LNG purchase deals with their foreign counterparts through the trading platform, with total trading volume at 130,000 tonnes.

Given China's market size and weight in the sector, China is well placed to establish a liquid and relevant market for LNG, said Laurent Vivier, president for the gas division of Total.

As China's largest LNG importer, CNOOC will actively participate in the online trading, and will support more domestic new players in the natural gas sector to enter the international market, said Wu Wenlai, chairman of CNOOC Gas and Power Group....

And in What the hell LNG news:
NOVATEK Shipped First LNG Cargo to United Arab Emirates

The Emirates must really, really hate Qatar. I know the Saudis do, they are moving ahead with their plan to dig a canal (moat) to turn Qatar into an island.
Qatar and Australia are jockeying back and forth for the #1 LNG producer crown.
Via the Architect's Newspaper a couple years ago:

With a new canal, Saudia Arabia plans to turn rival Qatar into an island

"Pivot to ‘green’: Russian gas & nuclear energy giants Gazprom and Rosatom to start producing ‘clean’ hydrogen"

Russia is not moving away from hydrocarbons.
From RT, July 23:
Russia’s move away from hydrocarbons took another step forward this week, as the country’s Ministry of Energy announced a roadmap to start producing clean hydrogen by 2024. 
Natural gas giant Gazprom – the largest company in Russia – and state-owned nuclear energy corporation Rosatom were both named in a federal plan focused on developing clean hydrogen.

With much of the world planning to pivot away from oil and gas in the near future, the country’s government is looking ahead to a more diversified energy sector. The international ‘green’ trend is a significant threat to the Russian economy, which is at present largely dependent on the export of oil, gas, and coal. Starting from 2021, the government intends to build on the country’s reputation as a hydrogen supplier, aiming to make exports of the world’s most abundant gas a large part of its energy sector.

According to the document published by the Ministry of Energy, Gazprom will begin to develop and test a methane-hydrogen turbine in 2021, with a view to using clean energy to power various modes of transport....MORE
HT: OilPrice, where today's top story is:
Fossil Fuels Are Here To Stay

Why Are We Seeing Venture Capital For French Insect Enterprises?

Two from EU-Startups:
August 18
Would you eat this? Why now is the time for insect farming startups
To many of us in Europe, the idea of insect farming might sound a little left field. In our daily lives, most insects are tolerated at best – and there’s little more to it. But it might be high time to rethink the role of insects.

The coronavirus pandemic, alongside global food security issues and climate change, has made the need to identify sustainable sources of protein even more pressing than ever. Could insect farming be the answer – and which European startups are already seizing the opportunity to innovate in this area?

Let’s break down what insect farming actually involves. More common in Asia and South America, insect farming includes all processes involved with producing commodities from bugs, including raising and breeding them. They can be farmed for what they produce, but can also be used themselves as food, feed, or even dye. They are treated as livestock, although kept in much larger quantities than on a typical farm.

A sustainable future?
But why the interest in insect farming? One of the greatest benefits is sustainability. The Food and Agriculture Organisation of the United Nations has even advocated insects as a major sustainable food source for the future, since the environmental impact of consuming insects is significantly less than traditional meat products. They also require little food and water to be kept alive.
Insect farming also comes with great socio-economic benefits for people on poorer regions of the planet. They can be gathered in the wild, cultivated and processed in both urban and rural areas, which can provide income through the selling. Plus, insects are a highly nutritious food source, packed with healthy fats, protein, vitamin, fibre and mineral content – practically a full balanced diet for humans!

European startups leading the way
With the range of benefits to both society and the planet itself, it’s little wonder that European startups are already finding ways (and raising some serious cash) to innovate in this new field.
Edible insect startups are leading the pack in France, with Jimini’s continuing to expand its product offering of ready-to-eat insect recipes, including a brand new energy bar range based on cricket flour. Founded in 2012, the startup even sells insect-infused pasta, as well as flavoured meal worms, grasshoppers and crickets to snack on. Their mission? To step by step introduce this new sustainable and healthy source of nutrients into our diet.

Another fast-growing French startup, Paris-based Ÿnsect, was founded in 2011. Last year they raised over €100 million as well as backing of €20 million from the EU to become a world leader in insect-based protein production for animal and fish feed, presenting a more sustainable alternative to the likes of soy....

Now Ynsect makes sense. Just as barnyard chickens that eat bugs are healthier than their cousins reared on feed, ditto for the fishies.
Also at EU-Startups, August 3:
“Insects will play an important role in tomorrow’s food chain”: Interview with Aude Guo, co-founder of Innovafeed

I am reminded of one of the links in 2017's "Scientists Swear Cockroach Milk Is the Next Big Superfood"
But how do you milk the wee vermin?
....Roach milk? I'm still having trouble with that picture of the prime ministers of Finland, Sweden, Denmark,  Iceland and Norway eating their bugs and plankton a couple weeks ago: 
"Nordics could become 'Silicon Valley' of food" (and Norway goes big on seaweed cultivation)
Please don't
As the bumper sticker says: "Mealworms aren't food, mealworms are what food eats".
Or something.

From EU Observer:
Plankton, seaweed and edible insects were on the menu, when the prime ministers of Finland, Sweden, Denmark,Iceland and Norway 
met in Austevoll, southwest of the city of Bergen in Norway on Tuesday (30 May).
They launched an initiative called Nordic Solutions To Global Challenges, which aims to achieve the UN's sustainable development goals for 2030....

"China’s targeted corporate shopping spree to continue, especially in Europe"

This is a pretty big deal and it's not like it just started.
Way back in 2012 we mentioned this, when China made a move on one of the world's premier crane manufacturers:
The Invisible Hand Touches Germany in No-no Place: China Grabs Putzmeister

More after the jump. From Bruegel, July 17:

Expect small, below the radar deals to continue to flourish and, by the same token, Europe to lose part of its edge in industrial technology and other strategic sectors.
China’s enthusiasm for overseas acquisitions waned in 2019. The series of negative economic shocks, from the US-China trade war to the tightened regulation of shadow banking, made financing of certain economic activities much tougher, including outward foreign direct investment. The worsening of the domestic and international environments took a toll on China’s business sentiment, cooling corporates’ interest and ability to expand overseas, especially through purchases of foreign companies. As if this were not enough, in early 2020 China took another unprecedented hit from the coronavirus outbreak. Heightened US-China tensions suggest that the post-pandemic environment could become harsher for Chinese investors who are considering buying companies overseas.
Does this mean that China is retreating from mergers and acquisitions (M&A) overseas? It may look like it when observing headline M&A figures, but the devil is in the details.

After all, the economic incentives behind China’s outbound foreign direct investment still exist. Chinese corporates that suffer from structurally lower domestic growth and return on assets are pushed to seek new business opportunities abroad. The need for industrial upgrades remains obvious in some sectors such as the semiconductor industry. Furthermore, liquidity conditions have turned much laxer in 2020 thanks to the monetary stimulus in response to the pandemic. Finally, the very low valuation of companies overseas is another important pull factor.

In fact, tighter screening of foreign buyers, especially Chinese, has not deterred Chinese companies from their interest in the M&A market. A deeper look into the micro-level transactions suggests that the decline in 2019, typically measured in terms of total deal value, is mainly explained by the reduction of large-scale transactions, while smaller deals have remained in place. In other words, the number of outbound M&A transactions conducted by Chinese corporates has remained rather stable. This seems to indicate that the response of Chinese corporates to the tougher screening for their acquisitions has been to pursue smaller deals. In other words: keep acquiring foreign companies, but do it discreetly, below the radar.

China’s target choices have also changed in response to the new global environment. Over the past few years, M&A transactions into the United States have waned, while Europe clearly gained importance, followed by Asia Pacific. To note though: while Asia Pacific received more deals than the EU, their total value was significantly smaller. Therefore, against the backdrop of declining average deal size, the EU remained the most important target for bigger acquisitions. For example, the Netherlands was China’s biggest target in 2019 because of Wingtech’s acquisition of the semiconductor company Nexperia. Russia also moved up as the second largest target for China in 2019 because of the acquisition of 20% of the Arctic LNG project in the first half of 2019.
In terms of sectors, consumer, information and communication technology, and industrial sectors account for nearly 70% of the total value of China’s overseas M&A. China clearly considers the industrial field to be strategic, as confirmed by its prominent role in the China Manufacturing 2025 policy guidelines. As the EU remains an important manufacturing hub for global production chains and a high-technology supplier, EU companies are likely to be targeted for potential purchase by Chinese corporates, all the more so as the EU’s investment-screening mechanisms are clearly laxer than those of the US and advanced Asian countries such as Korea and Japan. Last but not least, while privately-owned companies have increased their participation in overseas M&A transactions, this is not the case in the EU. State-owned enterprises continue to be the main Chinese buyers of European companies....

The German concern for their small and medium sized enterprises goes back quite a ways. Here's an old-timey pic via Wikipedia:
Representation of the supporting
role of the Mittelstand in Walter Wilhelms
„Mission des Mittelstandes“ (Mission of the Mittelstand, 1925)

Without the Mittelstand you are without Germany's export engine and without exports (and with Mutti's recent comments on free speech, yikes!) you are left with a Teutonic Belarus.
But without the charm.

If interested see also: "China’s strategic investments in Europe: The case of maritime ports" 

Climateer Line Of the Day: If You Can't Trust the Dark Web Edition

Via Borderland Beat's Dark Web's Largest Drug Sales Vendor "Empire Market" falls after suspected "Exit Scam":
“A proven exit scam would shatter the fragile trust that the cyber-criminal community had learned to
place in this platform. We will probably return to levels of fear, uncertainty, and doubt not seen since
the wake of the Hansa and AlphaBay disruption.”
Borderland Beat home

These folks are doing the most dangerous reporting in the world, we try to visit at least once a month.
A serious heads-up, because they cover the cartels, the content can get pretty gruesome.

Saturday, August 29, 2020

"Academics Attack ESG for Failure to Outperform During Crisis"

From Institutional Investor, August 20:
A new study refutes “widespread claims” that environmental, social, and governance considerations improved stock performance during the pandemic.

In the aftermath of March’s coronavirus crash, numerous fund managers and data providers determined that companies with high ESG scores outperformed during the rapid sell-off — and a surge of money followed into funds focused on environmental, social, and governance issues.
A new academic study, however, raises questions about the link between ESG considerations and stock performance during crises.

Researchers from Canada’s University of Waterloo, Tilburg University in the Netherlands, and New York University’s Stern School of Business challenged the “widespread claims by fund managers, ESG data purveyors, and the financial press” that companies with high ESG scores were better situated in the pandemic. In particular, the authors — Elizabeth Demers, Jurian Hendrikse, Philip Joos, and Bauch Lev — cited reports from BlackRock, Morningstar, and MSCI, which all found that ESG funds outperformed during the crash.

BlackRock, for instance, reported its sustainable funds achieved better risk-adjusted returns during the first quarter, while 24 of 26 ESG-tilted index funds tracked by Morningstar also outperformed their “closest conventional counterparts,” according to the analytics firm.
According to the academics, however, ESG scores “offer no such positive explanatory power for returns during Covid-19.”

“ESG is not an ‘equity vaccine’ against declining share prices in times of crisis,” Demers and her co-authors argued. “Following all this hyping of ESG as downside risk protection, there was no surprise in CNBC’s report that the first quarter of 2020 saw record inflows into sustainable funds.” ...

I had never heard the "ESG will save your portfolio" pitch although some of the true believers (and the marketeers) come close to selling them as the all-purpose nostrum: "It's the cure fer what ails ye."

As to ourselves we lean toward a variation on John Wesley's Sermon 50, The Use of Money (1744) which contains the admonition:

"Earn all you can, Save all you can, Give all you can" 

London Murder Map

First up, the Cambridge Independent:

University of Cambridge criminologist Manuel Eisner creates medieval murder map of London
It is as grisly a map as you will ever come across.
A University of Cambridge criminologist has plotted the murders recorded by coroners in medieval London from 1300-40.

The digital map is now available to view on the website of the Violence Research Centre, part of the Institute of Criminology, and tells the stories of the many violent ways Londoners met their deaths.
In Bishopsgate in August 1316, for example, we learn how tiler John of Heurne was grabbed by the throat by a woman, then attacked with a stone and a pick-axe by two men, in a dispute over the payment of rent. Shaken and beaten, his back, shoulders and sides were left mangled, and he died the next morning.

Some murders followed what now seem trivial disputes.
Priest Richard Henry, we learn, used to jump over a garden wall in Cripplegate to steal fruit, but around midnight one night in July 1316the property’s loyal gardener, Roger, was lying in wait and set after him with a stick. The priest produced a trenchour - a type of knife - and thrust it two inches into his heart, killing him.

Prof Manuel Eisner, who analysed 142 homicides in the city boundaries, said: “Following notification of a violent death, the coroner and sheriffs would summon a jury from the local area to investigate, then record all the findings....

Follow the link for the interactive version and click on a pin .
(How to Use the Medieval London Murder Map)

The first thing that attracts ones attention is just how geographically small the city was, although the Violence Research Centre points out:
By around 1300 London had become one of the largest cities in Europe. Its population is estimated to have been around 80,000. Most of the population lived within the City of London, north of the Thames, although Southwark had become a substantial urban settlement sprawling out from the south end of London Bridge.

Business Attire: Contrasting Suit Coat/Vest Combos Appear to be Making a Comeback

Thanks, I think, to a friend.

And in other fash news

Is It Time To Buy That Island You've Been Thinking About?

This is a very low-volume market,’ he adds. ‘When you’re talking about property in the
 $50-70 million-plus range, it’s about approaching clients to see if they might be interested.’

From Spear's Magazine:
How the pandemic is piquing UHNW interest in private islands
Safety concerns raised by the pandemic have sent private islands to the top of UHNWs’
shopping lists, writes Catherine Moye
Before the pandemic struck, as Knight Frank’s March 2020 Wealth Report showed, the real estate trend among UHNWs was for investing in wellness. Now Covid-19 has made the highest-rollers’ thoughts travel far beyond spa treatments, towards the isolated allure of desert island life.
Take Little Pipe Cay in the Bahamas. Along with incredible seascapes and pristine sandy beaches, it boasts a nine-bedroom mansion, several hundred feet of dock frontage and a large staff and operations ‘village’ spread over its lush 68 acres.

‘This is one of the most special properties that I’ve been involved with,’ says Edward de Mallet Morgan, a London-based partner at Knight Frank. He is marketing the island for $85 million, and since the crisis more of the ultra-rich have wanted to view it....

Also at Spear's:
Billionaire parents go to war with Le Rosey, the world’s most expensive school

Restaurant owner charged with breaking Sweden’s ban on spontaneous dancing

From The

Restaurant owner charged with breaking Sweden's ban on unauthorised dancing
 A restaurant owner in Härjedalen municipality has been charged with breaking the Swedish law that effectively bans dancing in bars unless the owner has a permit.
As the owner of this restaurant didn't have such a permit for the dancing that allegedly took place, he has been charged, reports P4 Jämtland.
The dance performances are said to have taken place from December last year to February this year. The restaurant owner denies the charge.
The controversial rule that bans dancing at bars that lack the correct permit can be traced back to the 1930s, although it has changed shape over the years.
A bar owner who falls afoul of the rules could risk the withdrawal of other permits, fines or even prison....MORE
Waddya in for?

Via RetroTV

From Those Wonderful Folks Who Bring Us Davos: "Could this COVID-19 ‘health passport’ be the future of travel and events?"

Apologies to Jerry Della Femina.*
From the World Economic Forum:
  • Rising COVID-19 infection rates pose a threat to global tourism.
  • A new app acts as a health passport for travellers who are virus-free.
  • Using blockchain technology, it provides an encrypted record of test results.
  • Its creators say it could allow healthy travellers to avoid quarantine.
  • The app could also allow sports and entertainment venues to reopen safely, as well as the global conference and exhibition industry.
Thousands of summer holidays are now up in the air, following a series of COVID-19 flare-ups around the world, with trips cancelled and travellers forced to quarantine when they return home.
In mid-July, the number of confirmed cases globally jumped by a million in just four days. The UK imposed a 14-day isolation on holidaymakers returning from Spain after infection rates spiked there, prompting the UK’s biggest tour operator to cancel all holidays to that country.

After recording its first cases since April, Viet Nam closed the tourist hotspot of Da Nang to tourists and evacuated 80,000 tourists from the city.
Now, a new health passport app promises to restore confidence to the travel industry, which has been badly hit by the pandemic. Global tourism shrank by 97% in April, according to the United Nations World Tourism Organization.

A possible solution
CovidPass is the brainchild of one of the World Economic Forum’s Young Global Leaders, Mustapha Mokass. It also involves other YGLs across 5 continents, including Muna AbuSulayman and Peggy Liu. CovidPass uses blockchain technology to store encrypted data from individual blood tests, allowing users to prove that they have tested negative for COVID-19.

Unlike contact tracing apps, CovidPass will not track users’ movements. Non-mandatory contact tracing apps have met with only limited success so far due to privacy concerns....

From Those Wonderful Folks Who Bring You Davos: The World Economic Forum Is REALLY Pushing Surveillance Cities
*Mr. Della Femina was a New York advertising guy and the inspiration for Mad Men.
In the 1960's he was brainstorming with some colleagues on how to sell Panasonic televisions and he came up with the tagline "From Those Wonderful Folks Who Gave You Pearl Harbor".
In 1970 he used the tagline as the title of his book on advertising. Here's the 1971 paperback cover:

The key takeaway from the book is Be Bold (borderline crazy).
Good advice for running a business, not so good for running a portfolio.

It's Good To Be A 29 Year Old Duke: Grosvenor Grabs The Ground Rent

The young Duke is worth something like $13 billion and last appeared on the blog in a cameo appearance:
Apparently Amancio Ortega, Zara's Founder (and #12 world's wealthiest) Has Been Accumulating Some Real Estate
As in larger than Hugh Grosvenor sized real estate.
On the other hand, young Hugh is 29 while Mr. O. is 84.....

And from The Steeple Times:
Vast Belgravia artists’ studio goes on sale for just £1.3 million, but of course, there is a catch and that is the extorionate ground rent
A 2,124 square foot artists’ studio in Belgravia has gone on sale for just £1.3 million or the equivalent of £612 per square foot. There is, of course, a catch and that is that the ground rent is a staggering sum of £58,000 per year.

Featured in The Steeple Times when last offered for sale for £995,000 in November 2017, the opulently decorated ground and first floor property available provides not only a double height 23’9” by 20’6” reception room but also a dining room and kitchen. There are also 3 bedrooms and 2 bathrooms and the space is described as being “for those involved in arts and media.”...

"Ghosts Only Cars Can Perceive"

There was a lot of design interest a few years back in a product that allowed cyclists to project their own bike lanes, an idea that is still being honed today.

Transportation infrastructure that only exists in the form of a projection is a great analogy for the state of cycling in the U.S. today, but what we might call projected infrastructure—road signs, bike lanes, and crosswalks that aren’t really there—can apparently also be weaponized, turned against the machine-sensing systems that navigate and steer driverless vehicles.

Researchers at Ben-Gurion University, for example, have shown that fake, drone-projected street signs can spoof driverless cars. Amazingly, these fake street signs can apparently exist for only 100 milliseconds and still be read as “real” by a car’s sensing package. They are like flickering ghosts only cars can perceive, navigational dazzle imperceptible to humans.

As if pitching a scene for the next Mission: Impossible film, Ars Technica explains that “a drone might acquire and shadow a target car, then wait for an optimal time to spoof a sign in a place and at an angle most likely to affect the target with minimal ‘collateral damage’ in the form of other nearby cars also reading the fake sign.” One car out of twenty suddenly takes an unexpected turn....MORE
The Ars piece is also worth a look.

A Mother's Love, Letter To Arthur Schopenhauer

‘All your good qualities,’ she wrote on 6 November, ‘become obscured by your super-cleverness and are made useless to the world merely because of your rage at wanting to know everything better than others … If you were less like you, you would only be ridiculous, but thus as you are, you are highly annoying.’
We, of course choose, to overlook young Arthur's flaws because he gave us  "Die Kunst, Recht zu behalten":

How to Win Any Global Warming Argument
First posted in February 2008.
It doesn't matter what point you want to argue, the winning stratagems are here. How many of these techniques have you observed/used? I'd bet at least half.

This was recollected while watching Monty Python's "Philosophers World Cup" (always good for a yuk). I had made mention, en passant, of Schopenhauer's little gem "Die Kunst, Recht zu behalten" in another post, I've Looked at Climate From Both Sides Now, but it really is stand-alone post-worthy.

So gather round kids as Uncle Arthur tells you how to fight back against any rhetorical bully.
Here's the table of contents, I'll put the link to the side-by-side Deutsch/English translation at the bottom of the post.
Controversial Dialectic
The Basis Of All Dialectic

The Extension
The Homonymy
Generalize your Opponent's Specific Statements
Conceal Your Game
False Propositions
Postulate What Has To Be Proved
Yield Admissions Through Questions
Make Your Opponent Angry
Questions in Detouring Order
Take Advantage of The Nay-Sayer
Generalize Admissions of Specific Cases
Choose Metaphors Favourable to Your Proposition
Agree to Reject the Counter-Proposition
Claim Victory Despite Defeat
Use Seemingly Absurd Propositions
Arguments Ad Hominem
Defense Through Subtle Distinction
Interrupt, Break, Divert the Dispute
Generalize the Matter, Then Argue Against it
Draw Conclusions Yourself
Meet him With a Counter-Argument as Bad as His
petitio principii
Make Him Exaggerate his Statement
State a False Syllogism
Find One Instance to The Contrary
Turn The Tables
Anger Indicates a Weak Point
Persuade the Audience, Not The Opponent
Appeal to Authority Rather Than Reason
This is Beyond Me
Put His Thesis Into Some Odious Category
It Applies in Theory, But Not in Practice
Don't Let Him Off The Hook
Will is More Effective Than Insight
Bewilder Your opponent by Mere Bombast
A Faulty Proof Refutes His Whole Position
Become Personal, Insulting, Rude (the Ultimate Stratagem)
And that, children, is why we study philosophy.
(and watch Monty Python)
Thanks to for keeping the Art of Controversy on the web.

Big Four Accountant Partners: "Does Kant’s definition or Augustine’s and Aquinas’s definition of evil as privatio boni in subjecto..."

Here are the first couple paragraphs of the Ultimate Stratagem:

The Ultimate Stratagem (XXXVIII)

A last trick is to become personal, insulting, rude, as soon as you perceive that your opponent has the upper hand, and that you are going to come off worst. It consists in passing from the subject of dispute, as from a lost game, to the disputant himself, and in some way attacking his person. It may be called the argumentum ad personam, to distinguish it from the argumentum ad hominem, which passes from the objective discussion of the subject pure and simple to the statements or admissions which your opponent has made in regard to it. But in becoming personal you leave the subject altogether, and turn your attack to his person, by remarks of an offensive and spiteful character. It is an appeal from the virtues of the intellect to the virtues of the body, or to mere animalism. This is a very popular trick, because every one is able to carry it into effect; and so it is of frequent application. Now the question is, What counter-trick avails for the other party? for if he has recourse to the same rule, there will be blows, or a duel, or an action for slander. 
It would be a great mistake to suppose that it is sufficient not to become personal yourself. For by showing a man quite quietly that he is wrong, and that what he says and thinks is incorrect - a process which occurs in every dialectical victory - you embitter him more than if you used some rude or insulting expression. Why is this? Because, as Hobbes observes,17 all mental pleasure consists in being able to compare oneself with others to one's own advantage. Nothing is of greater moment to a man than the gratification of his vanity, and no wound is more painful than that which is inflicted on it. Hence such phrases as "Death before dishonour," and so on. The gratification of vanity arises mainly by comparison of oneself with others, in every respect, but chiefly in respect of one's intellectual powers; and so the most effective and the strongest gratification of it is to be found in controversy. Hence the embitterment of defeat, apart from any question of injustice; and hence recourse to that last weapon, that last trick, which you cannot evade by mere politeness. A cool demeanour may, however, help you here, if, as soon as your opponent becomes personal, you quietly reply, "That has no bearing on the point in dispute," and immediately bring the conversation back to it, and continue to show him that he is wrong, without taking any notice of his insults. Say, as Themistocles said to Eurybiades - Strike, but hear me. But such demeanour is not given to every one....
And that, again, children, is why we study philosophy.

"Beyond the Commodity: Toward a New Understanding of Political Economy"

From American Affairs Journal:
It seems almost certain that in the aftermath of the Covid-19 pandemic, the U.S. economy will be even more dominated by giant firms than it was before. Government rescue efforts have been tilted in favor of the largest firms, and strong relations with suppliers give megacorporations such as Amazon and Walmart a huge advantage over smaller retailers. It seems highly likely that millions of small businesses will not survive the crisis.

This boost to giant firms will inevitably attract the attention of activists and scholars who have been working to revive the anti-monopoly politics that played a central role in the United States from the agrarian populists in the late nineteenth century up until the 1980s.1 Elizabeth Warren’s unsuccessful presidential campaign in the 2020 cycle gave this movement its greatest visibility to date, but the movement is not confined to the Democratic Party. Josh Hawley, Republican senator from Missouri, is just one of a number of conservatives who have argued that powerful tech companies, such as Facebook, should face antitrust scrutiny.

These efforts to revive Theodore Roosevelt’s iconic trustbusting initiatives in the twenty-first century have met resistance. For advocates of racial justice, gender justice, and a postimperial foreign policy, nostalgia for policies advocated by the first Roosevelt is a hard sell. Even in the second Roosevelt’s New Deal, the advocates of antitrust faced fierce opposition from opponents who saw the efficiencies that came with large size and who insisted that anti-monopolists imagined that all problems could be solved with their one preferred remedy.2 Some of these same arguments have resurfaced recently as critics of the anti-monopoly tradition have suggested that antitrust policies are not sufficient to address current problems.3

These criticisms are inherent in any project that seeks to revive a politics that was powerful in an earlier historical moment. Since so much has changed in the interval, the task of revival can appear nostalgic or even reactionary. This is probably why Milton Friedman, one of the most influential neoliberals of the twentieth century, usually avoided labeling himself as such. He preferred to disingenuously market his ideas in the United States as though they were new, original, and represented a commonsense response to the mistakes made by Franklin Roosevelt and his immediate successors.

A more honest way to give new life to ideas that had considerable currency in an earlier period is to put them on a new theoretical foundation that is derived from an analysis of current conditions. With such a new foundation, the risk of sounding antiquarian disappears and the agenda can be broadened far beyond the policy repertoire that was used in that earlier time. It is more than putting old wine in new bottles; it is a question of finding new and better ways of making wine while also modernizing the bottles.

That is the project of this essay. The older anti-monopoly tradition centered on the problem that giant firms undermine the vigorous competition required for markets to work. The problem today is that vigorous competition has been undermined because many of the things we consume differ significantly from the standardized commodities on which economic theory is based. When goods and services are not standardized, when they are available from a small number of outlets, when they are transferred over extended periods of time, and when they are interoperable with other purchases, it becomes costly for purchasers to exit from transactions and power accumulates in the hands of sellers. As a consequence, the discipline of market competition becomes much weaker, and firms are freer to engage in harmful or even predatory behaviors.

The Commodity and Its Discontents
The commodity concept originally emerged from the intersection of two historical trends. The first, dating back to the sixteenth century, was the expansion and systematization of global trade for a number of agricultural products and raw materials, such as cotton, wheat, sugar, coffee, tobacco, wine, iron ore, and precious metals. The second was the process of industrialization from the late eighteenth century onward that mechanized the production of cotton cloth, pottery, shoes, and other goods that had earlier been luxuries because production had depended on skilled artisanal labor. Both types of products could be conceptualized as commodities because they were standardized, provided by multiple producers, usually transferred in a single moment in time, and usable without coordinated purchases. Moreover, during the course of the nineteenth and twentieth centuries, as more and more things could be successfully mass-produced, the understanding of the economy as a system of commodity production was consolidated.

This understanding was the foundation for seeing the market as a largely self-regulating mechanism governed by the price system. When products are standardized and available from multiple producers, they compete almost entirely on the basis of price. When prices for a particular commodity rise, more producers are drawn into the market and some consumers will substitute a different commodity, so the price mechanism is able to bring supply and demand into balance. Moreover, when some producers discover a more efficient production technique, they are able to lower the price, and their competitors are forced to find comparable efficiencies. Hence price competition leads to continuing advances in the efficient use of inputs. The ongoing and rapid balancing of supply and demand and the continuing pressure on all firms to match the efficiency of cutting-edge producers are the central arguments for the superiority of markets over other forms of economic organization.

Yet even in the nineteenth century, the commodity concept provided only a partial and somewhat misleading view of the economy.4 For example, the insistence that human labor was just another commodity that was bought and sold on a labor market was resisted by working people and criticized by many analysts as obscuring the coercive power of employers. Moreover, a significant share of the labor supplied to the economy was not even provided through the market; the work of slaves, apprentices, housewives, and other family members working on farms or in businesses was not commodified.

Those who claimed that the economy could be understood as a system of commodity production also made greatly exaggerated claims about the market’s ability to dissolve older social hierarchies. Henry Sumner Maine’s famous formulation that society was evolving “from status to contract” was echoed by many nineteenth- and twentieth-century social theorists who imagined that older distinctions of race, ethnicity, gender, and national origin would soon disappear in the new system of voluntary contracting to buy and sell commodities.5 Even Marx and Engels in The Communist Manifesto insisted that in the new bourgeois order, “All fixed, fast-frozen relations, with their train of ancient and venerable prejudices and opinions, are swept away. . . .”6 Such assertions were recycled in the twentieth century in Gary Becker’s argument that firms with a taste for discrimination against women or racial minorities would be effectively punished in the marketplace.7

The reality is that the market economy has routinely exploited and intensified many of these old hierarchies. Plantation owners in the Caribbean and the American South used sophisticated management and accounting schemes to organize the labor of their slaves.8 Employers routinely used differences in gender, race, ethnicity, and national origin to play groups of workers off against each other. Meatpacking firms in North Carolina replaced undocumented Latino immigrants with workers from Haiti and Honduras who are in the United States with Temporary Protective Status. And while employers and businesses have alternated between pushing women into the housewife role and pulling them into the labor force, gender inequalities persist.

In sum, the view of the economy as a system of commodity production was never completely accurate. It mistook a part of reality for the whole, with the consequence that both the autonomy and the emancipatory potential of markets were greatly exaggerated. And yet, at another level, there was and continues to be some truth to this formulation. Marx highlighted this in his discussion of “the fetishism of commodities.”9 He argued that the buying and selling of things in the marketplace, including the labor of human beings, had the consequence that people came to misunderstand actual social relations among people as relations among things. People routinely make the calculation, for example, that it is necessary to work another week to purchase a specific product rather than questioning why the owner of my firm earns many times the wage of an average worker. What we learn from Marx is that it is important to examine the actual social relations that lie behind buying and selling in the marketplace.

Reconsidering the Commodity Frame
If understanding the economy as a system of commodity production was problematic and incomplete in the nineteenth and twentieth centuries, it has become even more distorting in the twenty-first because of changes in what the economy produces and how those things are produced. While we still depend upon the production of some of the same standardized products such as sugar, wheat, copper, and petroleum that were important in earlier eras, their weight in the overall economy has diminished sharply. Many of the things that we now consume do not resemble classical commodities, nor are they produced in the way that classical commodities were made.

To be sure, the declining weight of commodity production in the current economy must be understood as a success story for competitive markets. Things produced with the technologies of mass-production have fallen in price relative to the goods and services that cannot be mass-produced. For example, sophisticated machinery and about a hundred thousand workers made it possible for sock factories in the Chinese city of Zhuji to turn out seventeen billion pairs of socks in 2014.10 This is equivalent to two and a half pairs for every person on the planet. Moreover, a Chinese employee who is responsible for 170,000 pairs might earn just the Chinese minimum wage.

For consumers, the consequence is that the cost of many of the mass-produced items that one needs to survive—basic foodstuffs such as flour, rice, and meat, as well as clothing, oil, gas, and home appliances—has been steadily falling as a share of total income. Back in the 1960s, expenditures for food represented about a third of a typical family’s budget in the United States, but that has dropped to less than 10 percent even though there has been a big increase in expenditures for food consumed away from the home. It follows logically that the price of those things that do not lend themselves to mass-production, such as many services, housing, specialized goods, infrastructure projects, and research and development, are rising relative to mass-produced items. This contributes to a dramatic shift in consumption patterns away from standardized products.

Above all, most services—including health services, education, other professional services, and financial services—differ from classical commodities in two key respects. First, they are generally not standardized; most service providers promise to tailor the particular service to the specific needs of the individual client. Second, they are rarely transferred at a single moment in time; they tend to be provided in the context of an ongoing relationship, even if it is just a few hours that the anesthesiologists and the surgeon devote to a particular procedure.