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Commentary on The Capital Markets
2017-08-13 09:31 by Karl Denninger
in Editorial , 769 references
[Comments enabled]  

Folks, this one's pretty simple:

1. You have the right to free speech.  That happens to not only include but is explicitly present in the Bill of Rights to protect disgusting, outrageous speech.  Why?  Because nobody ever tries to censor the other kind.  I remind you that the KKK has for decades marched in Skokie, IL -- a Jewish community.

2. You do not have the right to respond to speech, no matter how outrageous or disgusting, with violence.  Period.

If you do not both accept and embrace #1 and #2 then we no longer have a Constitutional Republic.

You will rue the day America is no longer a Constitutional Republic, no matter if you think you're on the "correct" side of the argument or not.  The day our government fails to prosecute violence directed at someone for mere speech, irrespective of how outrageous said speech may be is in fact the bright-line test as to whether our Constitutional Republic still exists.

Let's see what Jeff Sessions actually does.

As for those demanding that the President intimate that the government should, or might, suppress free speech?  I'll buy you a one-way ticket to North Korea; you'll fit right in and can watch the off-time sunshine that appears to be headed for a rendezvous with Fatman.

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Oh what have I often said....

"That we would be sitting around watching holograms and Netflix would be an "old" invention. When it first came out it had decent movies on it. Now it has movies that I didn’t know existed and movies that just aren’t that interesting to me. They really lowered the quality so of course that meant Hulu was my backup. 


Psst.... don't look at their free cash flow; into deteriorating user perception that could be real trouble...

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2017-08-11 12:55 by Karl Denninger
in Foreign Policy , 276 references
[Comments enabled]  

How about a bit of analysis, eh?

First, Russia's Lavrov has apparently said that a nuclear armed North Korea is unacceptable.  Well, fancy that.  It would have been nice if you gave a **** ten years ago, or five, eh?

Then there's China.  Let us not forget that in order to execute any foreign transaction someone has to intermediate the money coming back into the country.  That someone has been one of a handful of Chinese banks, and may I remind you that all banks are licensed by the nation in which they operate.  Therefore China has been able to enforce all previous sanctions against North Korea and has willfully refused to.

Now China says that it "will not" interfere if North Korea attacks US interests first.  But China made no such promise if we attack to "change the regime."  In fact it claims it will "prevent" us from doing so (sure it will..... how?)

What's the significance of this bluster from China?  It reinforces China's refusal to adhere to the previous and present UN resolutions and punish those organizations that intentionally violate same, including those very same banks.

This belies the ultimate problem on the Korean peninsula: China most-definitely does not want a unified Korea under a representative republican form of government.  In fact it actively fears that happening since said nation would not be able to be controlled and could become hostile on a trade basis to China.  In fact, it probably would become hostile to same at least in some degree and worse, if it demonstrated success it would add to the risk of political instability in China itself.

So here we are.  China and Russia have sat on their hands or worse, actively aided and funded North Korea for 20+ years while it (1) built a reactor, (2) produced bomb material from said reactor, (3) assembled said bomb and (4) tested said bombs.  They also sat back while the nation developed missiles of increasing ranges, up to and now including, it appears, ICBMs.

Finally they also sat back while North Korea shrunk the size of said bombs so that they will now fit on a missile.

There are four, roughly, steps to producing a nuclear-tipped missile.

1. Make a nuclear bomb.
2. Make a missile that will go as far as you wish to shoot it.
3. Miniaturize said bomb so it will fit on the top of said missile, and the missile can lift it.
4. Figure out the ablative and stability technology so said missile's warhead survives reentry.

The only piece still in question now for North Korea is #4; the last test of their missile appeared to show the nose section breaking up on reentry.  But the Norks know why it broke up and I presume they will figure out what they did wrong stability and ablative-wise, and fix it -- quickly.

Cut the crap, folks.  China in particular is why the North Koreans are within spitting distance of an ICBM-deliverable nuclear bomb, an ability we must presume they now either have or are one test-fired missile away from confirming they have.  They need only splash one successful re-entry to demonstrate that they have accomplished all four of the above steps and China is directly and politically responsible for this state of affairs.

I don't care if you like it or not, whether it's politically uncomfortable or not, these are facts.

Barry Obama sat on the throne for eight years and did exactly nothing to China or anyone else for that matter in putting a stop to the progression of steps #1-4.  Neither did Boosh before him.  In fact all the way back to Bill Clinton there has been zero policing and plenty of evidence that North Korea was openly cheating on every "deal" they made that allegedly prevented them from getting a bomb -- and the technology to deliver it.

In each and every one of these instances of cheating China was directly and explicitly involved in enabling said cheating and the fund flows necessary to accomplish it.  Rather than go after and punish China for their part in these actions we instead bestowed ever-more-favored access to our markets and allowed China to steal US firms' intellectual property for the same 25+ year period.

I remind you that it was back in 1993 that North Korea got caught by the IAEA during routine inspections -- it was fairly clear to them that plutonium was being diverted, which is pretty easy to catch as the numbers of various isotopes produced by a reactor are pretty-well determined by physics, and when they don't all add up, well, you're hiding something.  In other words we've sat on this problem, and the Chinese have actively obstructed attempts to strangle the Norks nuclear program, for roughly 25 years!

Let's leave aside whether all the other folks who have acquired nuclear weapons should have been allowed to do so, or whether anyone should have them at all.  We can debate that all day long but it won't change a thing on the ground.  It is a fact that there are plenty of nations that do have nukes and it's also a fact that the genie is out of the bottle in that regard.  The process isn't all that hard to master given today's technology and more-importantly the world has never successfully stuffed the genie back in said bottle in any nation that has acquired said weapons, declared and tested or otherwise.  There is exactly zero reason to believe, as a result, that we can "de-nuclearize" North Korea successfully and this means that they have nuclear bombs, they either have or will have nuclear ICBMs, and we now argue only over the government that has or will have control over same.

That is the entire scope of the debate at this point in time folks -- we can hold people accountable, including Clinton, Bush and Obama along with both Russia and China now or later, but doing so (or not) will not change this fact.

Further, if you stick your head up your ass and refuse to accept this as fact then you are begging to glow in the dark and eventually someone is going to do exactly that.

So here we are.  We know that if there is an attack on North Korea then Seoul will come under immediate artillary bombardment by the North Koreans; they have dug into the mountains just north of the DMZ thousands of field pieces.  We cannot take them out before they lay waste a large part of South Korea -- basically anything within 30-40 miles of the DMZ is within range of their conventional artillery.  North Korea could also attempt to infiltrate the South and fight a guerrilla war; we know of a number of tunnels under the DMZ and we must assume there are dozens or even hundreds of others we don't know about.  Finally, they might have solved the reentry problem or worse, could take one of their diesel-electric subs, which are extremely quiet and difficult for us to detect even with our superior technology and sail it, with a big old-fashioned nuclear bomb and a suicide-willing crew, right up into someone's harbor and set it off.  While we might catch such an incursion before it happens the odds of success are actually quite good for such an attempt.  I put our ability to actively police and catch such an attempt at less than 1 in 2; active sonar is easily detected well beyond its useful range and said sub captain can then go somewhere else.  Absent active sonar a D/E sub is quiet enough to sneak in with a good probability of success and the Norks have several such subs.

Yes, we would utterly paste North Korea if any of that happened, but do not mistake winning for winning "cheaply."  It would not be cheap at all, either in lives or economic cost and there is a very real chance they get at least one nuclear bomb off on someone before we can kill enough of their command and control to stop it.

But at the same time do not make the error of thinking that China or Russia have done a ******n thing to stop the progression of this threat.  They have not, and what's worse is that said obstruction continues to this day, meaning that as things stand right now if you do not accept a nuclear-armed North Korea you have no choice but to hit them before they perfect that last step, and with China openly declaring that such a strike would cause them to "stop it" one must assume that we now have the situation of an immovable object .vs. an irresistible force.

This is not good at all since either someone has to change their mind as to what is acceptable or we wind up with open warfare, and quite-possibly war involving China on a direct basis.

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2017-08-11 08:43 by Karl Denninger
in Social Issues , 490 references
[Comments enabled]  

So it is offensive and not ok to speak the truth.

The engineer in question who penned the piece probably knew the odds were high that he'd get canned.  Nonetheless, having read the entire thing, it's not only correct on an ideological basis (conservatives are considered persona-non-grata in many environments) it's also scientifically accurate.

“To suggest a group of our colleagues have traits that make them less biologically suited to that work is offensive and not OK,” part of the CEO's note, entitled “Our words matter,” reportedly read.

That's not what the piece said, so obviously lying is now part of Google's "words" that "matter."

What the piece pointed out were some pretty-basic facts and how they might influence personal choice when it comes to fields of employment.

For example, it is a biological fact that men are biologically disposable.  The old saw about a man's minimum contribution to creating a new life being over in 20 seconds, while for a woman it inevitably requires at least nine months isn't sexism it's science.  Science isn't "offensive", it just is.

Now let's project that onto the workplace.  Let's assume that the collective decision is made by a company to engage in a project that is expected to take more than a year and for which the primary engineering talent is going to be asked to work 60+ hour weeks for the duration every single week.

Never been there, you say?  I have -- multiple times -- in my professional career.  Let me note that in none of those instances was the "request" a surprise; in fact in all cases I took the job knowing that was the "ask".  In the last case since I was founding the company I knew exactly what the expectations were going to be.

Could I also have, during the same 2-year period, become a father?  Yes.

Could a woman also, during the same 2-year period, become a mother?  No.

That's not sexism it's scientific fact.  It would have been physically impossible to both meet the requirements of the job and bear a child; even with an extremely aggressive (short) time off to actually have the kid, and zero complications it would have been physically impossible to perform the tasks put before me.

This doesn't mean that a woman cannot choose not to have kids at any given point in time.  But I will also point out that the period of time in most people's lives where they can do the "burn the candle on both ends and not wind up in the morgue doing it" game is in the key ~22-35 time frame -- exactly when most people would possibly like to start or add to families.

So if just half of women in the workforce decide that they'd like to have kids then they would not take jobs that had these demands.  That right there explains why you have one in five, roughly, women in hard-driving engineering areas -- and that makes the assumption that only half of all women would like to bear children!  In fact I suspect the percentage is much higher than 50%.

The outcome is not due to discrimination it's due to individual choice and both men and women have the right to make said choice.

Of course today we can and do turn this "problem" (that is, the choice someone makes) into sexism against men by demanding that no company ever place such a schedule before its engineering staff, and we can do it quite-effectively by mandating various policies such as paid parental leave whether equally available to both genders or not and other similar political decisions.

But if we do so then we cripple those firms that would otherwise be able to embark on such a project and succeed because we make that endeavor illegal to undertake.

This is, incidentally, exactly what the fired engineer was talking about.

When people speak of "high pressure" jobs most folks who have never done that sort of work have no idea what the hell they're referring to.  I do -- basically my entire professional career consisted of doing exactly those sorts of jobs under that sort of pressure.  It'll probably kill me some day; I'm sure I clocked off some years on my longevity by making that choice.

Make no mistake folks -- it was a choice, it was willingly made, and I do not regret it.

Can women make that choice?  Of course.  But by doing so they preclude other choices, such as having a family during that period of time.  That's science, not sexism.  A man can create a family under those conditions.  Maybe he won't choose to and maybe he shouldn't choose to, but he can, where a woman simply cannot.  It's virtually a biological impossibility and it has been a flat legal impossibility for decades.

To state as a matter of "corporate principle" that there are no biological and scientific differences between the sexes that bear on their representation in various parts of the workforce is a lie.  To state that one will not accept those differences that exist is to reduce the potential of said collective firm to the lowest common denominator of capacity of either sex in all respects because instead of forming groups within a company to utilize the strengths of each sex you instead demand that the inability expressed by any employee in the company become that to which all must conform.

This is exactly the argument that people like Sheryl Sandberg of Face****er likes to make and her argument has nothing to do with equality but is rather intended to cripple any firm that could challenge Facebook by making it impossible for them to do what Facebook previously did -- which involved requiring that sort of work schedule and output by its engineers!

Sheryl, in other words, wishes to mandate under threat of being shot that any potential competitor be crippled so as to not be able to take Facebook on.  For this she should be tried and imprisoned, along with the rest of Facebook management, under 100+ year old law that forbids monopolistic practices such as this (15 USC Ch 1.)

That's what Google allegedly "supports" but just like Sheryl Google's "support" has zero to do with "justice"; it is entirely-focused on suppressing competition.

It's also what the grievance industry and social justice warriors want, support and demand.  But at the same time they refuse to prosecute their war against those firms that built themselves up using and today live by the above scientific fact or even worse, just plain discriminate and yet give lip-service and pander to their bull****.  Take a look around the boardrooms and top executive positions at various competitively-successful firms and may I note that most board members in most firms are old enough that further child-bearing is not at issue.  Boeing anyone -- right in the middle of SJW heaven in Seattle.   How many women?  Two.  How about Amazon? Google itself?  Gee, the bastion of this screamfest has what percentage of women on the board -- and zero, I might add, in the top four officer positions!  How many officers on Netflix's board are women?

Now tell me again all about the SJW demands and why those four firms along with all the rest are given "exemption certificates".......

Guess what?  You can demand all you want, you can even get that infantile screaming turned into law in the United States but you can't force the rest of the world to put up with your bull**** and it won't.

Adopting such positions as a company is in fact how you lose in a competitive world.

Adopting such positions as a nation is how you get buried competitively on a global scale. 

There are plenty of people, myself included, who will not start a company under these conditions.  Had they existed in 1993 I would not have founded MCSNet.  Until and unless they go away that's a final decision on my part and, I argue, the only logical decision for any person in the US to make.  No more business ventures in this environment -- period. The SJW folks can stuff it.

Those are facts folks, and we as a nation must choose.  We must choose to either die competitively as a result of these "social justice" ****heads or we must, while respecting their right to speak, say "no" to them, shun them, refuse to play their game and in fact destroy them and their attempted strong-arm garbage exactly as they seek to destroy everyone else through their puerile and outrageous denial of facts.

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2017-08-08 07:00 by Karl Denninger
in Musings , 418 references
[Comments enabled]  

There's been some attention paid to all the "screen time" that our kids get these days -- and that this "screen time" makes us less, rather than more, happy.

Ever think about it folks?

You should.

And then you should remove Facepig, Messenger and all the other social apps from your phone.


Think about it folks.  Look at Facepig and beyond all the ads, sponsored clickbait garbage (which I've written on repeatedly) and such what's on there?

Someone doing something fantastic, right?  Someone you know on a cruise.  Another person winning a race. A third person having a beer. A fourth on top of a mountain somewhere.  A fifth, sixth and seventh posting 500 pictures of their cute baby or child (who by the way most-certainly could not have consented to their visage being permanently stolen by Zucker****er).

Think about the image this presents to you as what life is supposed to be.

It's all smiles.

Now I want you to contemplate something: Have you ever seen someone take a **** on Star Trek - or any other TV show?  You've got eight Star Wars movies, and yet I don't recall one person having to stop and take a crap.  The only time you do see that is when it's a joke as part of the plotline -- like in Jurassic Park with the lawyer.

Now let's expand that a bit.

You've never seen anyone actually do laundry.  Nor have you seen someone do the dishes, or even unload the dishwasher.  You've never seen them sit in traffic for an hour commuting to or from work.

Why not? Because if you actually put someone's daily life on television you'd never watch it; 95% of it is the normal daily grind -- we get up, we make a coffee, we ****, shower and shave, we get in the car to go to work and listen to music while stuck in traffic, we buy groceries, etc.

What do you see on Facepig, Snapass and similar?  The 1%, all the time, which inexorably leads you believe that your life should be that 1%, all the time.

But it can't be.

Nobody lives like that.

Even a billionaire who has no care in the world for making another nickel, ever, and has a building full of paid servants still has to ****, shower and shave.  The kid in High School has to sit in class and then do his or her homework.  Even the retiree doesn't get to live like that; he's gotta go to the doctor and get poked here and there, cook dinner, etc.

So what are you doing when you are continually looking at Facepig or Snapping away?  You're engaged in someone else's -- and your own -- fantasy.  A fantasy that is guaranteed to make you miserable because nobody can live a life that consists of even five percent of the projected thing you are viewing.

The fact is that nobody takes a crap on Star Trek because nobody would watch the show -- or the movie -- if they did.  Yet if we ever do master faster-than-light space travel the people on board that ship are still going to spend 90% of their time doing things that amount to "****, shower and shave."

They do it now on the ISS, they did it on Apollo, in Gemini and Mercury and they will in the future just like you do now.

Zucker****er likes to talk about bringing people together and other similar tripe. It's crap.  In fact it's worse than crap, it's a knowing lie.  Zuckerpig knows that even if there was no clickbait, fake deals and other garbage on the site that you'd still be made miserable simply by being there because the "face" you see is one you cannot possibly live.  It therefore cannot bring you joy -- it can only bring you tears to some degree.

Don't tell me about how it helps you "keep up" with your 457 "friends".  You don't have 457 friends.  In fact, I'm willing to bet that you can count the number of people who you can legitimately call "friend" on your fingers.

If you assert that's not true then I will make a declaratory statement in reply: None of those people are actually your friends -- they're all acquaintances, every single one of them.

I recently heard that a record number of kids committed suicide last year in our local High School.  I'm willing to wager 100% of them spent a huge amount of time with their faces buried in a hand-held fantasy machine that made them miserable while stealing a record of everything they did to try to make a profit off that same misery.

Those kids are dead; their misery has ended but the profit still went in Zuckerpig's pocket.

Folks, there's no value here for you in any of these "systems."  It's all net negative and it gets even worse when the data is mined off and sold as I've pointed out repeatedly.  We put these little spying machines in our pockets but how many people will stick them on silent or ignore them when they ring say much less toss 'em in "Airplane" mode?

It wasn't that long ago that if someone wanted to talk with you they called your house and if you were home you could talk to them.  But only one person at a time could do so in said house because there was only one phone line.  If there were five people in your family and one of them was on the phone, the other four could not make or receive a call.  If you were out getting groceries or even just mowing the lawn there were no voicemails either; the phone just rang and nobody answered it.  There were no text messages, Facepig posts or anything else of the sort.  If you were separated by more than a few tens of miles of distance the long-distance charges made sitting on the phone for an hour at a time punitively expensive and nobody could afford it.  Your only reasonable answer to a desire to say more than a few sentences for a birthday or other major life event was to sit down and write an actual letter and stick a stamp on it, then wait days for delivery and a reply.  You only did it on any sort of regular basis if the person you were corresponding with was an actual true friend or more; acquaintances, even those you call "family", you spoke with for 5 minutes on the phone on a birthday or anniversary, and perhaps you saw them over the holidays for dinner when one or the other of you traveled.  Most people had two or three such correspondents and no more simply because you had to invest a material amount of time to write said letters and there were only a few people who were worth it.

The number of people worth it in your life has not changed folks; instead interaction has been cheapened to the point of worthlessness.

How many posts do you think I've made on my Facepig timeline this year?


One talking about Facepig's spammy ads and two more being single-sentence replies to someone else's post.

Let me count that again for you folks: THREE.

Yeah, I've made a handful of other comments, but in terms of timeline posts -- it's three and only one of substance.  The other two were the prototypical 2 minute pre-cellular phone call.

I'm not trying to expand my reach on the Internet for monetary gain.  If I was then yes, it would make some sense for me to post things on Internet sites; that's called advertising.  But I'm not.

I have zero interest in posting my "personal triumphs" and gloating about them on social media.  My ego is simply not that large.  If you're interested in knowing what I'm doing and whether I happen to take satisfaction in some accomplishment then you probably know how to get ahold of me personally and we can share that.  It might actually mean something to both of us in that case.

More to the point if you wish to call me friend then you won't expect me to find your events, triumphs or whatever on Facepig.  You'll think enough of me to call, recognizing that if I don't answer immediately it's not because I don't like you but because I might be having dinner, mowing the lawn or in the middle of one of the three Ss of life -- and if you choose to leave a message I'll call you back when I can devote some time to us.  Ditto with a text; I might reply right away, but if not it's as likely to be because I'm under my car changing the oil or cleaning the gutters on the house as anything else.  You know, part of that daily ****, shower and shave routine.

Do I look here and there at Facepig? Yes.  But what I see is what I talk about above.  Is it worth my "engagement" in the general sense?  No; I recognize that not one bit of that will ever translate into changing the necessity of my life which, just like yours no matter how rich or poor you are revolves around ****, shower and shave.

But what said "engagement" will do, if I embrace it, is make me less-happy and more-miserable.

It must, because by its nature it portrays a fantasy that nobody can actually live.  Zucker****er knew this originally and in fact had "girl rating" pages on his Haaaarrrrrvvvaaarrrddd site which were exactly as "nice" as you might expect they'd be.  You don't really think he forgot that, do you, nor their popularity with his "friends" -- right?  (BTW what's his wife think about that?  I bet a few billion dollars makes her not care and that tells me everything I need to know about her.)

No, what Zucker****er did was turn your increased misery and reduced happiness into billions of dollars for him.  The founders of Snap and all the other so-called "social media" have done likewise.  They don't even give a **** if the misery their "engagement" contributes to causes nine teens to kill themselves in one semester at a given local school.  What's even worse is that they've done all of that in concert with people like John Legere, the brash CEO of T-Mobile who, along with Verizon, Sprint and AT&T, charge you in both money and slower performance, never mine crappier battery life, to deliver ads for the sole purpose of capitalizing on your decreased happiness.  Any of those carriers could put a stop to a large part of it in an afternoon by putting in place a switch you can turn on in your account that blocks all common advertising domains.

This would not be a "net neutrality" violation since you would choose to turn it on, not them.

But none have, and none will.

They won't because misery is profitable.

People who are truly happy don't need to spend on "aspirational" things.  They certainly don't need $1,000 iFrauds to make them feel good.  Miserable people are another matter; that smiling face with a nice big fat $1,000 iFraudy phone is a "message" they can try to get you to bite on, with the hope that it might make you smile -- at least until you see someone on a cruise, at which point you're back to being unhappy because you need to ****, shower and shave while Jane is on Facepig with a $5,000 vacation smile and a fat Mai Tai in her hand.

None of these apps are on my phone folks.  If I want to look at Facepig I'll do it on a browser, which I can close when done so it can't root around in my device and steal information on whatever else I'm doing.  I don't do "messenger", Snap or any of those others for the same reason.

You shouldn't either, and if you stop doing all of them I predict you will smile more.

Oh, and you'll also pay less -- in both misery and money.

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