Media worth consuming – August 2024

Top Five Articles

Warren Buffet showed exquisite timing by selling down substantial holdings in the months before the August sell-off.

Mark Zuckerberg has admitted that Facebook was wrong to acquiesce to White House and FBI pressure to censor Covid information, satire and humour, and the Hunter Biden laptop story.

Australia’s economy is fat and lazy; a downturn in commodity prices would leave us badly exposed.

Weight loss drugs are having much wider health benefits than expected, with scientists guessing that they lower inflammation throughout the body.

A CNN journalist has been mocked for “fact checking” a joke by JD Vance that the Democratic National Convention was held in Chicago so that Tim Walz could say he had been to a war zone.

Finance

American stock valuations are reliant upon high and growing profit margins. Despite attempts by the Chinese government to prop up its stock market, it has failed to hold gains over the last 17 years. Banks that underwrote the $13 billion of Twitter LBO debt are still stuck with the loans almost two years after the buyout closed. After catastrophe bonds posted strong returns in 2023, some buyers of protection are claiming that the market favours investors, ignoring the huge losses that can occur in a bad year. While American distressed office loans grab the most attention, distressed apartment loans are rapidly growing as well.

Politics & culture

From an economics perspective, the Presidential election is a choice between Tweedledee and Tweedledum. Trump’s proposed tax changes would be a step backward for tax efficiency and fairness. Tim Walz implemented high spending, high taxing policies in Minnesota, driving productive people out of the state. American high income earners are fleeing high taxing, Democrat run states for low taxing, Republic run states. Today’s Republicans have forgotten the economic success of the Reagan era and are almost as supportive of big government as the Democrats.

The Democrats have failed in their efforts to block Cornel West from appearing on the Presidential ballot in Maine and Michigan. Robert F Kennedy junior’s endorsement of Donald Trump highlights how the Democrats have rejected free speech, transparency and open elections. In 2014, Robert F Kennedy junior dumped a dead bear in Central Park in a prank that made it look like the bear had died after being hit by a bicycle.

A Republican led committee has found that there is ample evidence to warrant the impeachment of Joe Biden for using his office to enrich himself and his family members. The lenient treatment of Hunter Biden on various criminal charges is a stark contrast with the harsh treatment of Trump associates.

Nancy Pelosi suggested Joe Biden should be added to Mount Rushmore. Michelle Obama gave a speech criticising wealthy people but forgot to mention that she’s one of them. Chicago’s Mayor allowed pro-Palestine marches but blocked pro-Israel marches during the Democratic National Convention. Tim Walz is being criticised for leaving the National Guard when his battalion was being deployed to Iraq. Republicans are using clips of Kamala Harris from her Presidential campaign in 2020 to portray her ideological position as “hard left”.

Squatters took over a luxury mansion in Los Angeles and used it to run all night, drug fuelled dance parties for several months, while the owners were forced to wait for a court to process an eviction order. The Taliban in Afghanistan has brought in another round of restrictions on basic freedoms, particularly of women. Another brawl erupted in Turkey’s parliament. Investigations by German police have placed the blame for the sabotage of the Nord Stream gas pipeline on six Ukrainians, aided by the country’s then commander in chief.

Keir Starmer’s first major policies risk antagonising middle Britain, a crucial demographic necessary to win elections. UK police have been accused of two tier policing over their response to the recent riots. Three white British police officers were ruled to have been locked out of applying for a role when the local superintendent ordered that the role must go to a non-white officer. London’s police chief threatened to arrest people living overseas who post online comments he deems inflammatory.

The EU is trying to use legislation to curtail free speech in the US, with bureaucrats trying to dictate the boundaries of social media debate of the US Presidential election. A media monitoring collective accused of bias against conservative websites has announced it will close after Twitter commenced litigation against it. The founder of social media platform Telegram has been arrested in France due to the app being used to commit crimes, though some are claiming this is a battle over suppression of free speech.

Calls are growing for Harvard and other wealthy American universities to lose their tax-exempt status. The Guardian has alleged that Australian Universities are handing out master’s degrees to students who can barely speak English. The US government is handing over billions of taxpayer funds to Intel while it cuts 15% of its workforce. The Secret Service has apologised for breaking into a hairdressing salon to use the toilet.

Economics & work

Australian households have had larger falls in real household income in the last two years than in the last three recessions. Many Australia economists and think tanks are gaslighting by arguing that record high immigration isn’t the key issue in housing affordability. Homelessness amongst employed Americans is rising, primarily driven by soaring rents as housing supply isn’t keeping up with population growth. American employers are struggling to fill vacancies, in part due to the growing number of adults not willing or fit to work.

The Bank of England has concluded that the spike in British bond yields in 2022 was the result of the long term suppression of interest rates, which ultimately led to pension fund hedging rapidly unwinding. Central bank bailouts have incentivised moral hazard, which ultimately results in more bailouts.

If foreign aid doesn’t help poor countries become rich, why do rich countries keep providing it? Angola’s government has run out of money, so it is paying suppliers in government bonds. A comparison of Argentina, Estonia, Poland and Venezuela shows that free markets bring prosperity and socialism brings poverty. America’s modest economic growth over the past fifteen years looks fantastic compared to Europe.

If the UK wants higher economic growth, it must cut taxes and shrink government spending, as small government economies grow much faster than their big government peers. As Western economies increasingly choose bigger government, rent seeking pushes out legitimate competition. Higher corporate taxes depress wages, investment and economic growth.

Miscellaneous

Athletes complained about a protein shortage at the Paris Olympics, with the caterers forced to supply extra meat and eggs. Scientists have developed an enzyme that can convert sugar into fibre in the stomach, allowing sugar to pass through the body without being digested. Germany’s decision to shut down nuclear power has made its electricity far more expensive without accelerating the reduction in emissions. Coral levels at the Great Barrier Reef have increased in the last three years.

The big test for AI is whether it can deal with outliers. Google’s former CEO blames a more relaxed work culture for the company’s failure to keep up on AI. Scammers are using Facebook’s copyright tools and lack of diligence to extort money from users in the Middle East. Facebook and Instagram are happy to profit from advertising by drug dealers.