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The defense industry and silicon valley have had a long history in tandem – there is even a lot of evidence that defense spawned the technology industry there. Whatever the case, an interesting parallel that popped into my head while reading this article. That thought was about the creation of the OSS (Office of Strategic Services) during WWII that preceded the CIA. While traditionally technologies were developed for military use first, could there be a new era of consumer-/industrial-driven advances being applied to warfare? Rather than the target customer for technology companies, the DoD is now more of a(n) sub-sector/afterthought due to companies focusing on problems that affect the mass population – and the military is tough to do business with for many reasons. While DARPA focuses on challenges that are 20-30 years out, the new task is to find challenges that need fixing which are much more immediate.

This is obviously a super-long read but I find it fascinating. We’re living through a truly unique time in the history of finance with all the extraordinary experimentation going on via central banking. There is no good way to sum up the essay but I think that this quote is pretty on-the-money: “History shows us that economic recovery from a depression has never been successfully engineered without a major debt reduction, default, hyperinflation, political revolution, or world war.” Now that is a pretty wide statement of possibilities, but I think that currently the mentality of the market is that – at least for the Fed – central banks have “beaten” the recession. The essay really is about volatility rallying for any of the stated reasons. I think it’s a pretty good bet vol is relatively cheap compared to all the “shadow convexity” that exists with these multi-dimensional risks playing out in real-time.

I’m a huge fan of Charlie Munger and the “mental-model” school of thinking. That’s why when I read this article it was just another confirmation that if you can find certain patterns in nature, they can be applied across a variety of disciplines. Here’s a good quote: “...the same basic species-area curve was found regardless of the species or habitat. To put it mathematically, the curve followed a power law, in which the change in species number increased proportionally to the square root of the square root of the area. ... Power laws are common in science, and are the defining feature of universality in physics.”

Fortune - Is This Tiny European Nation a Preview of Our Tech Future? 12min

Given Estonia’s history, the invention of Skype in this country was ironic. While Americans were buying their first cell phones, about a quarter-century ago, Estonians were shut off from the world as an outpost of the Soviet Union. You could easily wait 10 years to be assigned a landline phone. By the time the Soviet Union imploded in 1991, the country was in a time warp. “We did not have anything,” says Gen. Riho Terras, the commander of Estonia’s armed forces, who had been a student activist at the time. The country had to reboot from zero. ... One generation on, Estonia is a time warp of another kind: a fast-f orward example of extreme digital living. For the rest of us, Estonia ­offers a glimpse into what happens when a country abandons old analog systems and opts to run completely online instead. ... At birth, every person is assigned a unique string of 11 digits, a digital identifier that from then on is key to operating almost every aspect of that person’s life—the 21st-century version of a Social Security number. The all-digital habits begin young: Estonian children learn computer programming at school, many beginning in kindergarten. ... this year Estonia will open the world’s first “data embassy” in Luxembourg—a storage building to house an entire backup of Estonia’s data that will enjoy the same sovereign rights as a regular embassy but be able to reboot the country remotely, in case of another attack. ... for a fee of 145 euros (about $154) e-residents can register companies in Estonia, no matter where they live, gaining automatic access to the EU’s giant common market—about 440 million once Britain leaves the union.

Bloomberg - Why Did a Chinese Peroxide Company Pay $1 Billion for a Talking Cat? 8min

Talking Tom Cat was an instant hit, launching a franchise whose titles have reached No. 1 in more than 100 countries on the App Store. Today, almost 350 million monthly active users support the apps, and Tom’s YouTube channel has more than 2 billion views. Unlike many mobile app creators, the Logins have proved adept at turning popularity into profit. Playing Talking Tom triggers an onslaught of advertising and in-game purchase offers, and Outfit7 earns more than $100 million a year. In early 2016 the Logins decided to cash out, hiring Goldman Sachs Group Inc. to find the most lucrative deal. ... The industrialists were willing to match the Logins’ asking price of $1 billion and let their team maintain autonomy. Samo and Iza signed away their company—having never taken money from outside investors, their stake was worth about $600 million. ... It’s hard to see the synergies between a maker of chemical solvents and a digital cat perched over a toilet. And curiously, the buyer, which had recently been renamed Zhejiang Jinke Entertainment Culture Co., had revenue of only $133 million in 2016, according to Bloomberg data pulled from regulatory filings, and its gross profit was $55 million. Jinke won’t say where the money to buy Outfit7 came from. ... The deal activity can best be understood as a consequence of quirks in the Chinese stock market. In China, industrial companies trade at valuations they’d never receive elsewhere in the world. ... some may trade at as much as 100 times their annual earnings—more than four times the multiple of General Electric Co. This means they can acquire companies at what is effectively a discount. ... Chinese companies are betting that by adding game studios that have better margins than a stodgy industrial business, their stock price will rise.

The Atlantic - How Pixar Lost Its Way 7min

A well-regarded hollywood insider recently suggested that sequels can represent “a sort of creative bankruptcy.” He was discussing Pixar, the legendary animation studio, and its avowed distaste for cheap spin-offs. More pointedly, he argued that if Pixar were only to make sequels, it would “wither and die.” Now, all kinds of industry experts say all kinds of things. But it is surely relevant that these observations were made by Ed Catmull, the president of Pixar, in his best-selling 2014 business-leadership book. ... The painful verdict is all but indisputable: The golden era of Pixar is over. It was a 15-year run of unmatched commercial and creative excellence ... The theme that the studio mined with greatest success during its first decade and a half was parenthood, whether real (Finding Nemo, The Incredibles) or implicit (Monsters, Inc., Up). ... The Disney merger seems to have brought with it new imperatives. Pixar has always been very good at making money, but historically it did so largely on its own terms.

Mental Floss - The Most Important Scientist You’ve Never Heard Of 40min

Meanwhile, a thousand miles west, on the prairies and farms of central Iowa, a 2-year-old boy named Clair Patterson played. His boyhood would go on to be like something out of Tom Sawyer. There were no cars in town. Only a hundred kids attended his school. A regular weekend entailed gallivanting into the woods with friends, with no adult supervision, to fish, hunt squirrels, and camp along the Skunk River. His adventures stoked a curiosity about the natural world, a curiosity his mother fed by one day buying him a chemistry set. Patterson began mixing chemicals in his basement. He started reading his uncle’s chemistry textbook. By eighth grade, he was schooling his science teachers. ... During these years, Patterson nurtured a passion for science that would ultimately link his fate with the deaths of the five men in New Jersey. Luckily for the world, the child who’d freely roamed the Iowa woods remained equally content to blaze his own path as an adult. Patterson would save our oceans, our air, and our minds from the brink of what is arguably the largest mass poisoning in human history.

Wired - One More Thing 26min

His company, he said, had “grown like a weed.” His workforce had increased significantly over a decade, coming to fill more than 100 buildings as workers created one blockbuster product after another. To consolidate his employees, he wanted to create a new campus, a verdant landscape where the border between nature and building would be blurred. Unlike other corporate campuses, which he found “pretty boring,” this would feature as its centerpiece a master structure, shaped like a circle, that would hold 12,000 employees. “It’s a pretty amazing building,” he told them. “It’s a little like a spaceship landed.” ... Inside the 755-foot tunnel, the white tiles along the wall gleam like a recently installed high-end bathroom; it’s what the Lincoln Tunnel must have looked like the day it opened, before the first smudge of soot sullied its walls. ... They describe the level of attention devoted to every detail, the willingness to search the earth for the right materials, and the obstacles overcome to achieve perfection, all of which would make sense for an actual Apple consumer product, where production expenses could be amortized over millions of units. But the Ring is a 2.8-million-square-foot one-off, eight years in the making and with a customer base of 12,000. How can anyone justify this spectacular effort?