Russian Spy Whale Seen In Norwegian Waters

Note the lack of "scare quotes" in the headline. They're real and they're magnificent.

From The Barents Observer, May 24:

The "spy whale” is back

The well known ‘Whaledimir’ beluga whale has been detected in the waters near Oslo. 

Read in Russian | Читать по-русски

This time the arctic waters whale has reached the densely populated area near Oslo. On Tuesday, May 24, the Norwegian Directorate of Fisheries, that has management responsibility for marine mammals, called for people not to interact with the mammal in order not to cause it any harm.  

The beluga ‘Whaledimir’ (Hvaldimir in Norwegian) was first spotted by local fisherman Joar Hesten on Norway’s Barents Sea coast in April 2019 in Måsøy municipality and has since been traveling along the Norwegian coast....

....MUCH MORE

What's it doing so far south, vacationing?

Previously:
April 2019
WTH: "Whale with harness could be Russian weapon, say Norwegian experts"
May 2019
"Satellite Images Reveal Russian Navy's Secret Arctic Marine Mammal Facility"
....Seen here returning a woman's phone, dropped in her excitement:

Hvaldimir? What kind of name is Hvaldimir?
Whaley McWhaleface should have been a lock.

There is some question whether this Beluga returning a woman's dropped phone is Hvaldimar or just some rando phone retrieving cetacean:

Here's the story and video of the retrieval.

Incredible Footage Shows Whale Retrieve Phone Woman Dropped In The Ocean

 

September 2019

Russia's Spy Whales Now Under Tighter Security

 

And related, in a sea-dwelling mammal sort of way: 

"Will Dolphins Become Neo-Luddites? Robots force Navy dolphins onto unemployment line"

Meanwhile, In Wales: Couple With 400 Different Personalities Between Them

It's probably a good thing they found each other, though it must get confusing at times.

Thanks, I think, to a friend for this five-year-old story.

From The Daily Mail:

Couple with identity disorders who have over 400 personalities between them reveal they sometimes go a day without eating – because their child ‘alter-egos’ don’t know how to COOK 

• Kai and Franz have both been diagnosed with Dissociative Identity Disorder
• It means the couple both have a number of different personas, known as 'alters'
• Alters' include boisterous children to quiet adults and emerge without warning
• Simple tasks such as cooking and shopping can be almost impossible for them

A couple who both suffer from a multiple personality disorder have revealed the struggle of living with hundreds of competing identities.

Kai, 27, and Franz, 26, who live in Cardiff, have both been diagnosed with Disassociative Identity Disorder and have more than 400 different personalities, known as 'alters', between them.

The 'alters' range from boisterous children to competent adults and each comes with their own memories, behaviours, attitudes and perceived age.

In 5Star documentary My Multiple Personalities & Me, viewers are shown how Kai and Franz can both 'switch' alters several times during a single trip to the supermarket, forcing them to try and appease each one with the shopping list....

....MUCH MORE

I wonder if LSD would be therapeutic.

Iran Seems Quite Pleased By The Number Of Engineers They've Trained Over The Last 30 Years

From Statista via the Islamic Republic News Agency:

Which countries trained the most engineers in the last thirty years?
Source: Statista pic.twitter.com/D5msMBsAmM

— IRNA News Agency (@IrnaEnglish) May 26, 2023

The 2015 numbers via one of the commenters on the tweet (where's China?):

"President of Belarus hospitalised after meeting with Putin"

Very unverified.

From Ukrainska Pravda, May 27:

Valery Tsepkalo, Belarusian opposition leader, said that after a meeting with Russian President Vladimir Putin, the self-proclaimed President of Belarus Alexander Lukashenko was taken to the Central Clinical Hospital of Moscow in critical condition.

Source: Tsepkalo on Telegram

Quote: "According to the information we have, which needs additional confirmation, Lukashenko, after meeting with Putin behind closed doors, was urgently taken to the Central Clinical Hospital of Moscow, where he is now located. The best specialists were sent to return him from a condition assessed by doctors as critical. [His - ed.] blood was purified, Lukashenko's condition was proclaimed not transportable.

The organised measures to save the Belarusian dictator were intended to ward off speculation about the possible participation of the Kremlin in his poisoning. It does not matter whether he returns to working condition or not, doctors warn of a possible recurrence of relapses. "....

....MORE

"Monetary financing at the Bank of England, the Federal Reserve, and the European Central Bank"

From Phenomenal World, May 27:

Pecuniary Salvation

Monetary financing—the issuance of public money to support public expenditure—has in recent times become a policy taboo. The message from economists to politicians, policymakers, and society more broadly is often that any central bank support for public expenditure is likely to destroy an economy.

In 2009, the taboo stopped the European Central Bank (ECB) from buying sovereign debt in the open market, an activity that, as we will shortly see, European treaties had been explicitly drafted to allow. Newly issued public debt languished on the market. Eventually, pent up supply and panicked investors brought the very project of European integration to the brink of collapse. This was a very different scenario to what happened in the US and the UK, where, in 2008 and 2009 respectively, central banks launched enigmatic “quantitative easing” (QE) programs, which involved buying large volumes of government debt. 

By 2020, the ECB had changed its tune. At the outset of the pandemic, it followed the Bank of England and the Fed, dutifully launching massive public debt purchase programs. Former ECB president Mario Draghi published an op-ed with the ominous title: “We face a war against coronavirus and must mobilize accordingly.” The model to follow was, he argued, was wartime monetary finance. When Christine Lagarde took over as president in 2019, she pointed to the role of government debt purchases in ensuring “supportive financing conditions […] for governments.” 

In recent years, central bankers have taken a more conciliatory position. While conceding that central banking does at times involve outright purchases of debt, they maintain to the public that today’s quantitative easing should not be confused with monetary financing. The reason is that the objective of bond purchases is not to facilitate government spending. Indeed, orthodox central bankers and critical academics have alike sought to distinguish today’s interventions in sovereign debt markets from historical practices of monetary financing. Despite those efforts, there are few notable differences between the bond purchases of the Great Depression, the two World Wars, and the Cold War and the “unconventional” policies of 2008–2022. The main contrast lies in communications strategy.

In a recent article in the Review of International Political Economy, we propose a new macro-financial account of monetary financing to explain the historical continuity of central banking practices. As we show, central banks have almost always acted to buy debt issued by governments in a crisis. We make our case by pointing to how central banks supported treasuries in the jurisdictions that have issued the two global currencies of the post-industrial age: the United Kingdom and the United States. We show that monetary financing has always been important in helping states navigate large fluctuations in the demand for, and supply of, government debt. The ECB’s 2009 refusal to support struggling member states stands as an exception in twentieth-century central banking practice. Relying on newly disclosed archival documents, we also show that in the early ‘90s, central bankers drafted the ECB mandate to make sure the central bank could buy government debt when needed—an insight that got lost in the market-ideological enthusiasm of the late ‘90s and early 2000s.

Central banks have always acted—and always will act—as the lender of last resort to governments facing what we describe as “sovereign-financing gaps.” Wars, post-war reconstructions, financial crises, and other economic emergencies force the treasury to spend as fiscal receipts disappear, irrespective of private investor demand. The central bank, as the issuer of new public money, typically accommodates those spending programs, either by directly acquiring debt from governments or by bulk purchases in secondary markets from securities dealers. Its role is to monetize deficits until supply and demand dynamics stabilize. On this account, stabilization of sovereign financing conditions is a “feature” not a “defect” of central banking. 

The most distinctive feature of sovereign finance is the demand for a continuous but irregular supply of funds which is exceptionally large relative to any other borrower, even in normal times. Sovereign financing gaps can easily exceed private creditors’ willingness to lend. In extreme circumstances, no credit is available in markets at affordable prices, for even the most solvent sovereign. When “debts are large and precarious creditors shy away,”¹ the volume of debt that treasuries can sell, even at high interest rates, is limited. Monetary finance becomes necessary “because debt cannot be sold.” Wherever sovereign financing gaps arise, governments must rely on central banks....

....MUCH MORE 

Equities: "Are cheap Scandinavian valuations a sweet red herring?"

From Verdad Advisers, April 24:

Swedish Fish

Sweden, the land of ABBA, meatballs, and, of course, the iconic Swedish Fish candy, may not be the first country that comes to mind when you think of global investment opportunities. Yet a new report from quantitative research firm Research Affiliates identifies Sweden as the developed market with the highest 10-year expected returns. And while the Swedish market is small, our internal valuation screens are also finding disproportionate opportunities in the land of lingonberries.

Europe generally is cheap. Today, Europe’s CAPE ratio is 20.4x versus 28.2x in the US, according to data from Barclays. This means Europe’s CAPE valuation today is 28% below the US, a discount that is nearly double the 15% historical average discount since 1981. On the right axis of the figure below, we measure the European discount in percentile terms, as illustrated by the gray line. Today’s European discount of 28% is in the 76th percentile of recorded history since 1981, having recently narrowed from the 95th percentile in October 2022.

Figure 1: European Discount Relative to the United States (1981—2023)

Sources: Barclays and Verdad analysis

Wide valuation spreads have historically presaged high future returns. Over four separate two-year periods beginning in September 1992 and June 1996, 1999, and 2003, Europe outperformed the US by 5.7 percentage points per year, on average, as valuation spreads narrowed over the course of two years. And over the six months between October 2022 and March 2023, the European equity market has returned 31.8%, more than double the US market’s return of 14.8%, according to data from Ken French.

Sweden isn’t the cheapest market within Europe. That distinction goes to Poland, another place we believe value investors are finding attractive bargains. Sweden’s CAPE ratio of 20.1x today is slightly below the European market at a 2% discount. But Sweden usually trades at a significant premium to the broader European market. Sweden has a highly skilled workforce, a stable political environment, and a business-friendly regulatory framework, as well as a number of market-leading global companies like Volvo (which today trades at 8x EBITDA), Ericsson (which trades at 5x EBITDA), and H&M (which trades 11x EV/EBITDA). Sweden is also the original home of IKEA (which is privately traded), and the country remains a core element of the company’s brand. In the table below, we present a valuation spread analysis where CAPE ratios for each major European country are measured relative to the 20.4x CAPE ratio of the overall European market. The table is ranked by valuation percentile relative to recorded history since 1981....

....MUCH MORE

So How Did Thales Price The World's First (known) Call Options?

Speaking of presses (the post immediately below), here's a repost.

So How Did Thales Price The World's First (known) Call Options? 

Beats me.
I say first known because Thales had a pretty good press agent in Aristotle and we can't know those earlier math whizzes who got written up by lesser scribes.

We've posted a few times* on the first known reference to derivatives. Here's the 2010 iteration:

More on Buffett's Grandfather Clause in the Derivatives Bill (BRK.B; BRK.A)

...The earliest mention of a simple derivative, an option, that I am aware of is found in Aristotle's "Politics", circa 350 B.C.E.
MIT's Internet Classics Archive uses the Benjamin Jowett translation.

From Book One part XI:

Enough has been said about the theory of wealth-getting; we will now proceed to the practical part. The discussion of such matters is not unworthy of philosophy, but to be engaged in them practically is illiberal and irksome.

The useful parts of wealth-getting are, first, the knowledge of livestock- which are most profitable, and where, and how- as, for example, what sort of horses or sheep or oxen or any other animals are most likely to give a return. A man ought to know which of these pay better than others, and which pay best in particular places, for some do better in one place and some in another. Secondly, husbandry, which may be either tillage or planting, and the keeping of bees and of fish, or fowl, or of any animals which may be useful to man. These are the divisions of the true or proper art of wealth-getting and come first.

Of the other, which consists in exchange, the first and most important division is commerce (of which there are three kinds- the provision of a ship, the conveyance of goods, exposure for sale- these again differing as they are safer or more profitable), the second is usury, the third, service for hire- of this, one kind is employed in the mechanical arts, the other in unskilled and bodily labor. There is still a third sort of wealth getting intermediate between this and the first or natural mode which is partly natural, but is also concerned with exchange, viz., the industries that make their profit from the earth, and from things growing from the earth which, although they bear no fruit, are nevertheless profitable; for example, the cutting of timber and all mining. The art of mining, by which minerals are obtained, itself has many branches, for there are various kinds of things dug out of the earth. Of the several divisions of wealth-getting I now speak generally; a minute consideration of them might be useful in practice, but it would be tiresome to dwell upon them at greater length now.

Those occupations are most truly arts in which there is the least element of chance; they are the meanest in which the body is most deteriorated, the most servile in which there is the greatest use of the body, and the most illiberal in which there is the least need of excellence.

Works have been written upon these subjects by various persons; for example, by Chares the Parian, and Apollodorus the Lemnian, who have treated of Tillage and Planting, while others have treated of other branches; any one who cares for such matters may refer to their writings.

It would be well also to collect the scattered stories of the ways in which individuals have succeeded in amassing a fortune; for all this is useful to persons who value the art of getting wealth.

There is the anecdote of Thales the Milesian and his financial device, which involves a principle of universal application, but is attributed to him on account of his reputation for wisdom. He was reproached for his poverty, which was supposed to show that philosophy was of no use. According to the story, he knew by his skill in the stars while it was yet winter that there would be a great harvest of olives in the coming year; so, having a little money, he gave deposits for the use of all the olive-presses in Chios and Miletus, which he hired at a low price because no one bid against him. When the harvest-time came, and many were wanted all at once and of a sudden, he let them out at any rate which he pleased, and made a quantity of money. Thus he showed the world that philosophers can easily be rich if they like, but that their ambition is of another sort....

Thales lived c. 624 BC to c. 547 BC.

Although they were far from the first--Bachelier's stuff was damned advanced--Black and Scholes formalized options pricing in 1973, with one of the key variables being the risk-free interest rate.

In the Black-Scholes equation, the symbols represent these variables: σ = volatility of returns of the underlying asset/commodity; S = its spot (current) price; δ = rate of change; V = price of financial derivative; r = risk-free interest rate; t = time. Photograph: Asif Hassan/AFP/Getty Images

Publishers and Alcohol

From Delancey Place: 

Gutenberg and Wine

Today's encore selection -- from Where Good Ideas Come From: The Natural History of Innovation by Steven Johnson. 

For Johannes Gutenberg, it was the ubiquity of winemakers nearby that helped lead to the invention of the printing press around 1440 CE:

"Pliny the Elder (23-79 CE) ... tells the story of a device winemakers had recently invented, a new kind of press that employed a screw to 'concentrate pressure upon broad planks placed over the grapes, which are covered also with heavy weights above.' There is some debate among scholars over whether Pliny may have been rooting for the home team in attributing the invention to his compatriots, since evidence for the use of screw presses in producing wines and olive oils dates back several centuries, to the Greeks. But whatever the exact date of its origin, the practical utility of the screw press, unlike so many great ideas from the Greco-Roman period, ensured that it survived intact through the Dark Ages.

"When the Renaissance finally blossomed, more than a millennium after Pliny's demise, Europe had to rediscover Ptolemaic astronomy and the secrets of building aqueducts. But they didn't have to relearn how to press grapes. In fact, they'd been tinkering steadily with the screw press all along, improving on the model, and optimizing it for the mass production of wines. By the mid-1400s, the Rhineland region of Germany, which historically had been hostile to viticulture for climate reasons, was now festooned with vine trellises. Fueled by the increased efficiency of the screw press, German vineyards reached their peak in 1500, covering roughly four times as much land as they do in their current incarnation. It was hard work producing drinkable wine in a region that far north, but the mechanical efficiency of the screw press made it financially irresistible....

....MUCH MORE

Related:
"Despite the far-reaching consequences of Johannes Gutenberg’s printing press, much about the man remains a mystery, buried deep beneath layers of Mainz history".

One of my all-time favorite maps:

That's it. Mainz.
The rest of the series are after the jump. This one is via Economists View, we have the source below....

"Report: French Bank Let Associates of Lebanon's Central Bank Governor Move Funds Unhindered"

Following on April 2'a "Who Is Riad Salame? Lebanon’s Central Bank Chief Accused of Embezzlement".

From the Organized Crime and Corruption Reporting Project, May 24:

A report leaked to OCCRP's Lebanese media partner Daraj reveals how French bank BNP Paribas allowed associates of Lebanon's Central Bank Governor, Riad Salame, who is currently under investigation for money laundering and embezzlement, to transfer funds with minimal due diligence.

n 2013, Nabil Aoun, a Lebanese stockbroker and former president of the Lebanese Broker Association, reportedly initiated a transfer of 1.8 million euros in favor of Rise Invest, a Panamanian company beneficially owned by Marianne Houwayek, a close associate of Salame. In the same year, Houwayek purchased an apartment in central Paris for the exact amount transferred.

The transfer, originating from a Swiss company associated with Aoun, was justified as a "parental donation" and was one of many transactions flagged by a European financial intelligence unit investigating Salame's wealth amid accusations that he exploited his position as head of the central bank to enrich himself, his relatives, and his associates.

The leaked report concludes that a link between Salame and the funds deposited in Rise Invest's bank account with BNP Paribas "could not be excluded." It raises concerns about BNP Paribas' insufficient effort to ascertain the origin of the 1.8 million euros and its allowance of the transfer based on minimal documentation, including a nondescript piece of paper, bearing Aoun's name, which stated that he was acting on behalf of Houwayek's father.

Aoun corresponded with the bank through a "private" and "discreet" email address, which the report suggests might belong to Salame. In his note, Aoun specified that the transfer was taking place in a "private capacity" and not as part of a "commercial activity."

BNP Paribas declined OCCRP's request for comment....

....MUCH MORE

Startups: "18 French soonicorns to watch"

That headline is from Sifted, not me. Explanation below,

From Sifted.eu, March  26:

Following a record year for French tech, these are the companies that could be on their way to unicorn status

French tech is having a moment. The country was the only major tech ecosystem in Europe that saw its startups raise more money in 2022 than in 2021 — and the French government is keen to keep up momentum, with President Macron setting the lofty goal of having 100 unicorns by 2030.

Over the past few months huge amounts of money have been pumped into the French tech sector and the government is looking at financial reforms that would further boost entrepreneurship and investment. 

France also minted seven new unicorns last year — the joint-second most of any European country in a year where the number of new $1bn+ valuations dropped. And while investors tell Sifted they expect far, far fewer new unicorns in the next 12 months, a number of startups could be on their way to hitting the mark in the next couple of years. 

Sifted used data from Dealroom and spoke to VCs to find out which French tech companies are most likely to hit unicorn status next. Each company was founded after 2005, raised its last round in 2021 or later and has a valuation between $500m-999m, according to Dealroom.

The French startups that could hit unicorn status

Deepki

What: A SaaS platform for the real estate industry to measure sustainability metrics.

Latest valuation: $660m-990m (March 2022, Dealroom estimate)

Founded in 2014, Deepki collects and aggregates data on sustainability metrics like carbon emissions, water and energy usage and waste — as well as other ESG measurements. It last raised in a $150m Series C in March 2022, and also made it onto Sifted’s 2022 climate tech soonicorns list.

 

Platform.sh

What: Platform-as-a-service startup.

Latest valuation: $560m-840m (June 2022, Dealroom estimate)

Founded in 2014, the startup manages all the infrastructure behind building and running a website or app for companies. It raised a $140m Series D in June 2022.

 

DNA Script

What: Biotech that makes DNA for labs.

Latest valuation: $825m (January 2022)

Founded in 2014, DNA Script helps labs create custom DNA, and also made Sifted’s techbio soonicorns list. It last raised in January 2022, with a $35m extension to the $165m Series C it picked up the previous autumn. 

 

Clubfunding

What: Real estate investment platform.

Latest valuation: $550m-825m (September 2022, Dealroom estimate)

Clubfunding is a crowdfunding platform that allows real estate entrepreneurs to drum up alternative financing for their projects by issuing bonds. It raised €125m in September 2022 — its only round to date.

....MUCH MORE

Something we posted in August 2010:

...One of my mentors could not stand indecisive traders. He loathed them almost as much as he loathed losses.
If one said about an instrument "I'm watching it" he'd bellow "You like to watch? What are you, a freaking voyeur?" Except he didn't say "freaking".

If you were asked about implementing a certain strategy and said "I'm thinking about it"  the response was "What are you, a freaking philosopher?", again substituting a different word. 

Remember that the next time somebody tells you they have something they want you to watch.

On Bubbles

First up, George Soros via Real Investment Advice, June 2016:

Soros – A Rudimentary Theory Of Bubbles

....David’s comments reminded me of George Soros’ take on bubbles.

“First, financial markets, far from accurately reflecting all the available knowledge, always provide a distorted view of reality. The degree of distortion may vary from time to time. Sometimes it’s quite insignificant, at other times, it is quite pronounced. When there is a significant divergence between market prices and the underlying reality, there is a lack of equilibrium conditions.

I have developed a rudimentary theory of bubbles along these lines. Every bubble has two components: an underlying trend that prevails in reality and a misconception relating to that trend. When a positive feedback develops between the trend and the misconception, a boom-bust process is set in motion. The process is liable to be tested by negative feedback along the way, and if it is strong enough to survive these tests, both the trend and the misconception will be reinforced. Eventually, market expectations become so far removed from reality that people are forced to recognize that a misconception is involved. A twilight period ensues during which doubts grow and more and more people lose faith, but the prevailing trend is sustained by inertia. As Chuck Prince, former head of Citigroup, said, ‘As long as the music is playing, you’ve got to get up and dance. We are still dancing.’ Eventually, a tipping point is reached when the trend is reversed; it then becomes self-reinforcing in the opposite direction.

Typically bubbles have an asymmetric shape. The boom is long and slow to start. It accelerates gradually until it flattens out again during the twilight period. The bust is short and steep because it involves the forced liquidation of unsound positions.”

....MUCH MORE

RIA revisited and expanded on Soros and bubbles in January 2020's "Market Bubbles: It’s Not The Price, It’s The Mentality."

Soros used to say something along the lines of "When I see a bubble forming, I rush to buy, adding fuel to the fire." I believe—but cant find the source—that exact quote is from early 2020 but HUGE Caveat, Soros later that year changed his public pronouncements:

“Pivoting to his legendary approach to financial markets, Soros acknowledges that investors are in a bubble fueled by Fed liquidity, which creates a situation that he now avoids. He explained that ‘two simple propositions’ make up the framework that has historically given him an advantage. However, since he shared it in his book, ‘Alchemy of Finance,’ the advantage is gone.” – MarketWatch

So we have two diametrically opposed statements in the same year.

You have my word as a hedge fund manager....

And more interestingly, and definitely less confusingly, a post originally from 2012 but updated:

For the third time our link to the South Sea Bubble paper has rotted,
Here's the version hosted at MIT before it was published in the American Economic Review.

Riding the South Sea Bubble

By PETER TEMIN AND HANS-JOACHIM VOTH

Original post:
Prop Trading the South Sea Bubble: Hoare's Bank 1720

 

I've mentioned the archives at Hoare's bank a few times, firstly, I believe, in "South Sea Bubble Survivor Says Dismantle RBS Along With Lloyds":

*From deep in the link-vault comes a tiny treasure, an analysis of Hoare's trading during the South Sea bubble (15 page PDF):

Riding the South Sea Bubble
By PETER TEMIN AND HANS-JOACHIM VOTH

This paper presents a case study of a well-informed investor in the South Sea bubble. We argue that Hoare’s Bank, a fledgling West End London bank, knew that a bubble was in progress and nonetheless invested in the stock: it was profitable to “ride the bubble.” Using a unique dataset on daily trades, we show that this sophisticated investor was not constrained by such institutional factors as restrictions on short sales or agency problems....MORE 

The bank has opened their records to academics and Temin and Voth have taken full advantage.
Along with the above they published "Banking as an emerging technology: Hoare’s Bank, 1702–1742" in Financial History Review and "Private borrowing during the financialrevolution: Hoare’s Bank and its customers, 1702–24" in Economic History Review.

It's Riding the South Sea Bubble that really stands out though and is the 'tiny treasure'.

Yesterday, as I was putting "The World's First Stock Exchange (and first bear raid, first dividend, first equity derivatives...)" together I wanted to refer to RtSSB and did a quick search of the blog.
The link was broken.

The entire original purpose of this blog was to give me a database of things that caught my interest during the trading day. Hosted on Google's servers. Searchable by the Goog's algos (or anyone else).
And the damn link was broken. So I had to replace it.

And I re-read the whole 15 page paper, starting with:

What allows asset price bubbles to inflate? The recent rise and fall of technology stocks have led many to argue that wide swings in asset prices are largely driven by herd behavior among investors. Robert J. Shiller (2000) emphasized that “irrational exuberance” raised stock prices above their fundamental values in the 1990s. Others, however, have pointed to structural features of the stock market, such as lock-up provisions for IPOs, analysts’ advice, strategic interactions between investors, and the uncertainties surrounding Internet technology, as causes of the recent bubble. We use a historical example to ask which of these explanations is most apt, with the potential to shed light on other important episodes of market overvaluation.

We examine one of the most famous and dramatic episodes in the history of speculation, the South Sea bubble. Data on the daily trading behavior of a goldsmith bank—Hoare’s—allow us to examine competing explanations for how bubbles can inflate.

While many investors, including Isaac Newton, lost substantially in 1720, Hoare’s made a profit of over £28,000, a great deal of money at a time when £200 was a comfortable annual income for a middle-class family (John Carswell, 1993). The behavior of a single knowledgeable investor can tell us much about the nature of bubbles and investors during periods of substantial mispricing. The bank did not profit simply by chance. It “rode the bubble” for an extended period while giving numerous indications that it believed the stock to be overvalued. Short-selling constraints and the difficulties of arbitrage that have been emphasized in recent work on the dot-com mania cannot explain the South Sea bubble. A zero-investment constraint, if it existed, did not bind market participants like Hoare’s. Perverse incentive effects arising from delegated investment management highlighted in recent work on mutual funds and hedge funds were not at work. We infer that the need for coordination in attacking the South Sea bubble was the key to allowing it to inflate to such an extreme extent, in line with recent theoretical work by Dilip Abreu and Markus Brunnermeier (2003).

There is a rich body of earlier research on the emergence of bubbles. The efficient markets hypothesis rules out substantial mispricing (Eugene F. Fama, 1965). The same conclusion emerges from no-trade theorems under asymmetric information, as well as from backward induction in finite horizon models (Manuel Santos and Michael Woodford, 1997; Jean Tirole, 1982). Famous historical episodes like the South Sea bubble, the tulip mania, and the Mississippi speculation are given as examples of markets functioning reasonably well under uncertainty (Peter M. Garber, 2000). Recent theoretical and empirical work, however, suggests that bubbles can inflate even if there are large numbers of highly capitalized, rational investors....

And I thought "sweet".

The two most important parts of the paper "II. Hoare’s Trading Performance" and "III. Causes of Success" are definitely worth a couple minutes. Here's the link. (also replaced in the original post).

Time, Once Again, For The Most Extreme Sport In The World (that involves cheese)

As noted last year, coming out of covid:

After two years of "Gloucestershire Cheese Rolling 2021 has been cancelled" and "Gloucestershire Cheese Rolling cancelled for 2020 amid ..." the pent-up anticipation is almost unbearable: The beauty, the grace, the effortless athleticism....

First up, from GloucestershireLive:

When is the 2023 Cheese Rolling taking place in Gloucestershire?

The Coopers Hill Cheese Rolling is one of the UK's most bizarre and extreme sporting events, and it happens on our doorstep

Contestants in the men's downhill race chase the cheese down Cooper's Hill in Gloucester, 2022.

....MUCH MORE

And from SoGlos:

Gloucestershire Cheese Rolling
The world-famous Gloucestershire Cheese Rolling is back for another year in May 2023, with spectators flocking from far and wide to see the daring sporting action on Cooper’s Hill.

The cheese will roll down Cooper's Hill on Monday 29 May 2023.

....MUCH MORE, including video.

Finally, some in-depth reportage:

Reluctant locals forced to participate in cheese rolling
UNWILLING Gloucestershire residents have been made to chase a wheel of cheese down a hill by Londoners wanting to see authentic rural life.

To the chagrin of the locals, they were forced to recreate their proud tradition of risking life and limb running down a near-vertical gradient in pursuit of cheese for the amusement of weekend visitors.

Tom Logan of Stroud said: “We don’t actually do stuff like this any more. I’m an IT consultant.

“If I need cheese I just go to Tesco. Even a really big cheese doesn’t excite me to the point where I’d be willing to break an ankle.

“But they said we had to, and they’re rich, and if they sold up property values round here would collapse, so we all chased a cheese down a hill and my solicitor’s fractured two vertebrae.”...MORE

And because we left these announcements in a bleeping computer rather than using the tried-and-true Post-It Note we apologize for the rush and fully understand if you can't make it to the spectacle. 

However, should you arrive too late for the contests, all is not lost. 

Cooper's Hill is #6 on the SoGlos list "20 of the most romantic places to propose in Gloucestershire" while nearby Cranham Woods is one of the "14 of the best places to walk your dog in Gloucestershire."

What's Up In Belarus? Polish General and Democracy NGO Are Talking Armed Uprising On The Way

From Charter97.org, the pro-democracy-in-Belarus NGO, May 25:

Will Belarusian Volunteers Decide To Liberate Mazyr?

The raid in the Belgorod region launched an uncomfortable discussion for Lukashenka.

Russian volunteer fighters entered the territory of the Russian Federation for the third time. The authorities of the Belgorod region have allegedly been preparing for such attacks for a long time, building fortifications, but volunteer raids are becoming more and more successful.

These raids strain not only Putin, but also Lukashenka. The Belarusian dictator is also afraid that this can happen to him.

Polish General, former Deputy Minister of Defense Waldemar Skrzypczak said that Warsaw should be ready to support the troops that will conduct an operation against Lukashenka. He clarified that he was talking about a military operation.

“It has no military potential to be able to prevent such an uprising. Russia will not help him much, as it will have its own problems,” the Polish general said about the Belarusian regime.

The statement of the Polish general caused hysteria among Lukashenka’s and the Kremlin’s media.

Ukrainian political scientist and expert of the Center for Belarusian Communications Maksim Pleshko noted that Ukraine is interested in “a free, democratic Belarus with a national consciousness” on the northern border of the country.

The expert believes that if the counteroffensive of the Armed Forces of Ukraine ends in success, then those armed Belarusians who are part of the combat potential of the Ukrainian army will not lay down their arms, but will go to liberate Belarus from the dictatorship. Pleshko also drew attention to the professionalism of the Belarusian volunteers compared to Lukashenka's militia....

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And the day before:

Political Scientist On Polish General’s Statement: Belarusians Are To Get Ready, Big Changes Are Coming

And the day before that, May 23, one of the Ukrainian generals said Belarus' capital could be a target of opposition raiders:

SSU Major General: Belarusian Volunteers Can Repeat Raid And Reach Minsk

The nukes appear to have not yet arrived in Belarus. Three from the Belarusian Telegraph Agency (BelTA):

May 25:  "Lukashenko guarantees security of Russian nuclear weapons in Belarus"

May 25:  "Belarusian-Polish border safely locked from infiltrators, Lukashenko says"

May 25: "Lukashenko comments on Poland's statements about 'impending uprising in Belarus'"

Meanwhile up north and not directly related to the Belarus doings the Telegraph is reporting:

 British troops on Nato Exercise Spring Storm in Estonia are being welcomed with open arms by the locals 

The British are supposed to be on anti-Russian maneuvers but who knows what is actually going on with all this stuff. 

If interested see also:

from February 8: 

The RAND Corporation Blueprint For Forcing Putin To Over-Extend Himself

I hope that the U.S. or NATO or whoever commissioned this study didn't pay a lot for it, it's basically the strategy that Pope John Paul II, Margaret Thatcher and Ronald Reagan came up with in the early 1980's although the details do differ. The tactical components of the RAND plan are:

 1. Arming Ukraine ;
 2. Increase support for jihadists in Syria;
 3. Promoting regime change in Belarus;
 4. Exploiting tensions in the South Caucasus;
 5. Reducing Russian influence in Central Asia;
 6. Rivaling the Russian presence in Transnistria.

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The study is from 2019, its basic idea is to get Russia to overextend itself both militarily and more especially financially.

Raghuram Rajan: "We Should Be on the Alert for More Problems"

As noted in March 30's "Raghuram G. Rajan: 'The Fed’s Role in the Bank Failures'"

Professor Rajan is one of the few central bankers who seems to know what's what (except maybe for the RBI currency switcheroo of November 2016. That was a fustercluck)....

From Neue Zürcher Zeitung's TheMarket.ch, May 15:

Raghuram Rajan, Professor of Finance at the University of Chicago and former Governor of the Reserve Bank of India, fears that the crisis in the US banking sector is not over. He explains why he thinks the stress in the financial system is an unintended consequence of easy monetary policy, and why a soft landing seems unlikely.

Deutsche Version

In the United States, one bank after another is collapsing. After the failures of Silicon Valley Bank and Signature Bank in March, another bank, First Republic Bank, had to be rescued through an emergency takeover at the beginning of May. PacWest is feared to be next. Even the shares of larger banks such as US Bancorp and Capital One are under heavy pressure.

*****

Although things otherwise remain remarkably quiet in the financial markets, Raghuram Rajan sees no reason to sound the all-clear. «Unfortunately, the sense is that this particular phase of the banking problems is over, but I think the banking system still needs watching», says the finance professor at the University of Chicago and former Governor of the Reserve Bank of India.

Dr. Rajan knows what he is talking about. In the summer of 2005, he caused a stir when he warned against excesses in the banking system in front of the assembled financial elite at the economic symposium in Jackson Hole. He was sharply criticized back then, but today he is one of the most renowned economists of our time.

In an in-depth conversation with The Market NZZ, which has been lightly edited for length, he explains why the banking crisis is likely to continue, where the main vulnerabilities in the financial system are and why, in his view, they are a consequence of the easy money with which the Federal Reserve has repeatedly flooded the system in the past years. He also says why the risk of a hard landing for the economy is high.

«At some point, we need to pay more attention to easy monetary policy, creating the kind of financial vulnerabilities that lead to the problems we’re seeing today»: Raghuram Rajan.

Professor Rajan, the regional banking crisis in the US is dragging on. With First Republic Bank, another institution recently collapsed. How do you assess the situation?

As it was the case with Silicon Valley Bank and Signature Bank, First Republic Bank was in a very difficult situation. This was a bank in the category of the «walking wounded», it was inevitable that something would happen eventually. Unfortunately, the sense is that this particular phase of the banking problems is over, but I think the banking system still needs watching.

Why?

The recent events highlighted mid-sized banks with volatile deposits and asset problems. I think the asset problems haven’t gone away. There are still lots of losses to be absorbed on bank balance sheets, and the problem with volatile deposits hasn’t gone away either. There certainly are deposits that are looking at higher interest rates and demanding higher interest rates to stay. That means net interest margins for many banks are shrinking considerably. As a result, there will be an issue of longer-term health of the banking system, especially regarding mid-sized banks exposed to areas like commercial real estate....

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Some of our posts on Professor (U.Chicago-Booth) Rajan:

February 11, 2022
Former Reserve Bank of India Head, Raghuram Rajan: "Central Banks Have to Start to Move"

«We sort of stopped thinking about countries like Italy. But if we come out of the pandemic and interest rates are not at 1% or 2%, but at 4% or 5%, what happens to public finances? Obviously, the biggest risks are always the ones you don’t see. But this is a risk we haven’t paid attention to for a long time»:

—Raghuram Rajan.

Long time readers may remember Professor Rajan from such hits as: 

Raghuram Rajan on The Boom and Bust in Farm Land Prices in the United States in the 1920s
and:
India’s Central Bank Governor Discusses Robber-Baron Capitalism and a Fine Veg Cutlet 

Okay, I'm being a bit whimsical, the man is brilliant and I wish he was running the U.S. Fed rather than sitting in his comfy endowed chair at the Booth School of Business.

Also:

• Raghuram Rajan: "When the Interests of Monopolists and Authoritarians Coalesce"
• Raghuram Rajan: "Disruption, Concentration, and the New Economy"
• "World Out Of Whack: An Absurd Unintended Consequence Of Abnormally Low Rates"
• Fannie and Freddie Must Die! Some guy in Chicago Takes on Paul Krugman's Version of the Mortgage Mess (FNM; FRE)

Attention Estate Managers: Gamekeepers as a Service (it's a GaaS, GaaS, GaaS)

In the eternal battle of them that have vs them that want, and with dystopian images of urban poachers roaming the countryside, a spinout from ETH Zürich has the answer.

From Reuters via EuroNews, May 25:

Meet the AI-powered robot replacing humans as security guards in Switzerland 

 The robot frees up a single human to patrol large outdoor areas that normally require significant staffing but at a lower cost, its creator says.

Amid labour shortages and growing attention to safety, security companies around the world have been looking to deploy robots on patrol duty.

In Europe, people living in Switzerland have been seeing an autonomous two-wheeled robot roaming around the country for the past six months.

The patrol bot, developed by a robotics start-up from ETH Zurich, Ascento, has been acting as a guard for Swiss security firm Securitas AG. 

Ascento says its patrol robots have been providing an added layer of security and enhancing operational efficiency at several test sites, including a Swiss railway depot.

It has foldable "legs" and wheels as "feet". Its "head" houses the computer, battery, sensors, and cloud based-AI....

....MUCH MORE

Okay, they don't explicitly mention estates or gamekeepers but that's the first thing I thought of.

Plus, I don't see why they couldn't double as gun-bearers and beaters for your own hunts.

Dress them up! Since they don't have forelocks to tug, perhaps a Heather Buchanan Wax Flat Cap (£14.95) will allow your robot to show the right combination of deference and obsequience when tipping the cap:

California Is Still Plowing Snow Off The Roads

In some places the snow on the roads is so deep that the snowblowers can't cut through it.

So they shave the mass from the top to make it manageable for the blowers.

From the California Department of Transportation, first up, May 25:

Maintenance crews on Sonora Pass (State Route 108) have made progress over the past five days, but this snow is putting up quite the battle.

Before you travel this spring, be sure to check out https://t.co/E2g76i5kLV or download the #Quickmap app to your iOS or Android device. pic.twitter.com/lCD3BlBFIV

— Caltrans District 9 (@Caltrans9) May 25, 2023

And a demonstration of the technique from May 11:

Because the snow over Sonora Pass is so deep, @Caltrans9 maintenance crews are using a snow cat to push the snow from above to the road below where the snow blowers can clear it from the highway. This method reduces the snow depth, allowing the snow blowers to push through. pic.twitter.com/wfVNR65TLx

— Caltrans District 9 (@Caltrans9) May 11, 2023

The road is due east of San Francisco and rises to 9600 feet at the Pass.

Nvidia's Guidance For The Ages: Analysts React (NVDA)

Some of the enthusiasm—one "pay any price, bear any burden"* investor was able to grab some at $395.00—from yesterday has been tempered a bit, currently $380.91 up $75.53 (+24.73%).

From Yahoo Finance, May 25:

....Tristan Gerra, Baird (Outperform rating, upgrade from hold; $475 price target, up from $300): "We raised our estimates above consensus and added a Fresh Pick designation to Nvidia on March 20 reflecting our channel feedback about strong H100 orders notably related to ChatGPT emerging in March but we failed to upgrade at that time. As AI-related order momentum continues into the second half, annualized earnings of $10 are at reach within 2-3 quarters in our view, reflected in the valuation post earnings. Our raised next two-year EPS forecast assumes continued AI-related momentum driven by two secular growth trends: continued adoption rate for parallel processing-based acceleration in data centers, and the emergence of AI models notably related to ChatGPT and LLMs [large language models], all of which require GPUs."

Atif Malik, Citi (Buy rating; $420 price target, up from $353): "While we had raised our target price and estimates into the earnings, Generative AI upside was bigger than we expected. Nvidia expects data center sales to roughly double in the July quarter driven by Gen AI demand from CSPs, consumer internet companies, and accelerated computing in enterprises. Nvidia estimates only ~4% of the $1 trillion data center CPU installed base over the last four years has been GPU accelerated, implying AI adoption remains in early innings."....

....MORE

*Because of the earlier reference to Soviet negotiating tactics I was thinking of John Kennedy's Inaugural Address:

...Let every nation know, whether it wishes us well or ill, that we shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe to assure the survival and the success of liberty.... 

"Why BlackRock Is Building Strategic Partnerships With Family Offices"

Sure but can they provide full concierge service including party planning?

From Institutional Investor, May 25:

The wealthiest private investors are turning to asset managers for deals, due diligence and other insights.

BlackRock is stepping in to offer services to family offices, who are increasingly seeking out more external resources to build their investment portfolios.

Like many institutional investors, family offices have big allocations in alternative and private investments and prize nimbleness so they can take advantage of deals during down markets. But the current market environment has also made family offices realize they aren’t as good at some forms of investing as they thought. Direct deals with companies are just one example. As a result more family offices are turning to asset managers and others for help. The relationships between family offices and managers are a private wealth management version of the strategic partnerships that institutions have been pursuing for years.

In BlackRock’s 2023 family office report expected to be published Thursday, family offices said their key challenges when investing in private markets were getting access to the best direct deals and managers (41 percent), high fees (40 percent), liquidity constraints (35 percent), and lack of transparency (30 percent).

Bankers and others are becoming “extensions” of family offices’ staff, according to Whitney Ehrlich, head of U.S. family offices at BlackRock.

“I do think what we are seeing is recognition from large single-family offices that they can really leverage their partners on the asset management side,” Ehrlich said. More families are coming to BlackRock for investment support of some kind, whether it is for help sourcing deals, due diligence, or allocations, she added....

....MUCH MORE

A subject near and dear.
Previously:
"Family offices are snapping up talent from private-equity firms and elite wealth managers"
"Superyachts, Mixing Drinks: The Truth About Family Office Jobs"
"Family Offices as the Apex Of the New Butler Class"
Family Office/Outside Managers Not Quite Cutting It? Maybe What You Need Is A Family Bank

 "A tour through the subterranean world of Silicon Valley’s most elite and clandestine family offices."

Related: 
Competitive Intelligence Macquarie Style: First Establish a Fake Family Office...
Foreign Family Offices Are Opening U.S. Branches
Family Office Assets-Under-Management League Table
UPDATED--Wha? "Family Offices Look to Invest More Than $30 Billion in Hedge Funds in Next Year"
Family Offices Showing Greater Appetite for Agriculture/Farmland Than Institutions
Sidestepping Private Equity With a Family Office

 "Attention richest people in the world, I am absolutely willing to throw it all away to do PR work for you."

That's not me, that's Aelfred The Great. But it's a pretty good intro for Mediaite's:

The Twenty-Seven Most Embarrassing Reactions to Taibbi Thread About Twitter Censoring Hunter Biden Tweets

[first your template] 

Construct Tweet: [Say formerly respected or once great, etc.] Matt Taibbi [call it PR or comms or like that] for the [world’s richest man, the richest person in the world, so on]. Quote tweet thread. [hashtag optional].

....MUCH MORE

However, we'll go Aelfred one (or two) better, by offering not just PR.

Our package: complete Family Office services including concierge and butler, art appraisal, succession and estate counseling and life-coaching.

Or, for the truly discriminating, ask about our Luxe programme with unbiased private equity ROI analysis.
(includes party planning option)

Not quite there yet?:
Proctor & Gamble: "Make Your Home Smell Like You’re Rich" (PG)

Also the dynasty series:

"Managing family wealth for dynastic power"

News Your Dynasty Can Use: How The Habsburgs Stayed So Powerful For So Long
Tips on playing the long game....

Should you be contemplating establishing a dynasty, you have come to the right place.
You are going to want a seat of power and Construction Physics has a primer on "How To Design A House To Last 1000 Years."

Finally, how to pay for it all without risking everything on that dissolute great-grandchild that is sure to pop up:
Anti-Piketty: Merrill Lynch's Tips on Creating a Financial Dynasty

I've always liked the Wikipedia entry on the Habsburgs:

The progenitor of the House of Habsburg may have been Guntram the Rich, a count in the Breisgau who lived in the 10th century....

Yup, having someone with the honorific "The Rich" in the fam  is always a running start to your dynastic ambitions.

Oh Crap, I Almost Forgot Karl, The Last of the Habsburgs

And finally:
Why Real Estate Ownership Is Required For Intergenerational Wealth
We've looked at the importance of housing as a cornerstone of intergenerational wealth a few times, and not just for piles like this:

That's the courtyard of Arundel Castle, it's been in the fam (Fitzalans; Howards; Fitzalan-Howards) since the mid-1200's (with a few reversions to the Crown). More after the jump....

"Russia Rejects 4-Day Week, Proposes Extra Day With No Pay"

Shades of Soviet Foreign Minister Andrei Gromyko's negotiating style.

Although he was famously known as "Mr. No" for his preferred negotiating stratagem; from time to time he would mix things up by completely ignoring any progress or agreements that had been achieved and resetting talks to a starting point even more discordant than they had originally been.*

Because he would go over each and every little niggling point, many Western diplomats came to hate being in the same room with him.

From Tech.co, May 24:

The initiative aims to recover economic losses bought on by international sanctions, but workers won't get paid more. 

As nations around the globe start warming to the idea of a 4-day work week, Russia is heading in the opposite direction, with the Russian labor ministry officially granting employers the legal right to ask workers in for an extra day.

According to a letter to the labor ministry from a leading business group, the initiative was proposed to deal with the escalating fallout the country is facing from international sanctions and the cost of its invasion of Ukraine.

The policy relies on the consent of employees, but with extra hours worked not being financially accounted for, and Russia's track record with workplace practices being chequered at best, it's uncertain whether the average worker will actually have much of a say. Here's what we know so far....

....MUCH MORE

*On the other hand he used to say he preferred 10 years of negotiations to one day of war. During the time he was Foreign Minister, 1957–1985, the West and the Soviet Union managed to keep that genie in the bottle, though the world got very, very close to war during the Cuban Missile Crisis when Gromyko was ordered to lie to President Kennedy and did so straight to his face.

"What performance-enhancing stimulants mean for economic growth"

From The Economist, May 25:

Could America’s Adderall shortage have harmed its productivity? 

Towards the end of last year America began running short of medicines used to treat attention-deficit hyperactivity disorder (adhd), including Adderall (an amphetamine) and Ritalin (a central-nervous-system stimulant). Nine in ten pharmacies reported shortages of the medication, which tens of millions of Americans use to help improve focus and concentration. Around the same time, something intriguing happened: American productivity, a measure of efficiency at work, dropped. In the first quarter of 2023, output per hour fell by 3%.

Coincidence? Probably. Lots of other things could have explained the productivity dip. Equally, though, many of America’s most productive people rely on Adderall to get the job done. It often seems like half of Silicon Valley, the most innovative place on Earth, is on the stuff. And surprising things can cause gdp to rise and fall, including holidays, strikes and the weather. What’s more, the economic history is clear: without things that give people a buzz, the world would still be in the economic dark ages.

Not all drug consumption helps people work better, of course. Don Draper from “Mad Men”, a tv series about advertising executives in the 1960s, came across many of his finest ideas three Scotches deep. But contrary to popular belief Ernest Hemingway, one of America’s greatest authors, never advised “write drunk, edit sober”, preferring to write liquor-free. In a book published in 1983 David Ogilvy, perhaps the most famous real-life mad man, warned of the dangers of drunks in the office. Use of cocaine, common on Wall Street and in Hollywood, can give people a short-term boost. It also causes grave long-term problems.

Indeed, economists normally think of mood-altering substances as a drag on prosperity. One estimate in 2007 put the cost of drug abuse in America at $193bn, or around 1.3% of gdp. More recently economists have looked at “deaths of despair”, which many link to abuse of opioids. In 2021 more than 80,000 Americans died from opioid overdoses.

But stimulants can play a positive role, too. Consider two of them: sugar and coffee. The first allowed people to work harder; the second allowed them to work smarter.

Until the start of the 18th century calories were a significant constraint on Western economic growth. In 1700 total food supply per person in Britain was equivalent to around 2,000 calories a day—enough for the average man to survive, but not to do a great deal more. Workers were therefore inefficient. Many of the poor, who survived on even more meagre diets, barely had the energy to move, let alone do anything useful....

....MUCH MORE

Previously:

New York Fed On "Anxiety, Overconfidence, and Excessive Risk Taking" (pathological gambling and self-manipulation with booze and blow) 

See also:
Berlusconi Blames Stock Market Volatility On Cocaine (and a look at neurotransmitters)
"Your genes affect your betting behavior"
New research suggests link between genetics, Wall Street success"
Engineer -- Addicted to Day Trading -- Stole Nearly $750,000 Making False Securities Class-action Claims
"What Caffeine Actually Does to Your Brain"
Ethanol: "Why Coffee, Cigarettes and Booze Can Be Good For You"
Can't Get Enough o' That Lithium. "Peak Lithium: Will Supply Fears Drive Alternative Batteries?"

Although Lilly introduced Prozac to the U.S. in 1988, they didn't really begin marketing it until 1991. Sales increased five-fold by 1994, the year the big bull market of the nineties kicked in.
The joke on trading desks was that this was the Prozac market, sort of the "What me worry?" approach to equities (which may explain the Nasdaq at 5048 in March, 2000).*
This excursion down SSRI lane was triggered by the thought "If we run out of lithium, what will the bi-polars do?".

 *Cramer had similar thoughts, relayed in this NYT article from 2002:

...''My own view is that one reason the investor class, including me, missed the downside was serotonin,'' James J. Cramer, a former hedge fund manager and author of ''Confessions of a Street Addict'' (Simon & Schuster, 2002), said, referring to a substance in the brain that antidepression drugs augment. ''Prozac and all those other drugs banish the 'this is the end of the world' thoughts,'' Mr. Cramer explained. ''Which means you are not as anxious as you should be about an obvious down side.''...

Your Brain and Financial Bubbles
The Internet, Deflation and Depression

...Further, the newspapers likened the changes to those seen in cocaine abusers but went on to describe something quite different from my understanding of what blow does to the reward pathways, overexciting the dopamine cascade until the various D receptors no longer react to dopamine and eventually leading to anhedonia. The big A is often concurrent with and like anxiety, may even kindle for depression.
Don't worry, be happy.

See also "Pleasure Dissociative Orgasmic Disorder"  

Here's an ad for Dexamyl, a Smith, Kline & French offering comprised of the stimulant dextro-amphetamine and the barbiturate amobarbital.

Note how alert yet relaxed the gentleman appears:

 

Also slightly whack.