August 28, 2015
Something else must be driving the fall in Chinese equities. ... What could that be? Have China’s banks overextended themselves more recently? Central planning or not, as we all learned in 2008, a surge in shadow banking can lead to terrible things. ... I am no expert on China, but it is very tempting to conclude that the Chinese gambling spirit has simply migrated from Macau to Shanghai. ... Relative to 1999, when the euro was first introduced as an accounting currency, Greek workers had at one point (around 2009-10) enjoyed almost twice the wage growth compared to the average German worker. Although much of the advantage has since been given up, Greek workers have still out performed their German colleagues since the introduction of the euro – at least as far as wage growth is concerned ... Ukraine, the Middle East and Puerto Rico are all in the dumps – but for three very different reasons. ... the deflation talk is likely to blossom up again, and several countries on either side of the Atlantic could be flirting with recession later this year or early next. Consequently, yields on long bonds could fall further, and stock markets may be in troubled waters for a while. I don’t expect this to be anywhere nearly as bad as 2008, though. It is a normal cyclical downturn, which may not even be strong enough to be classified as a recession. But a slowdown it is. ... I think the U.S. economy will substantially outperform most other OECD economies over the medium as well as the long term – even if there is a modest cyclical slowdown just around the corner.
According to the city, the Taxi King controls 860 cabs (Freidman says he actually operates more than 1,100). That’s more than anyone else in town. Factor in the hundreds of vehicles he has in Chicago, New Orleans, and Philadelphia, and he’s almost certainly the most powerful taxi mogul in the country. Freidman makes money by leasing the cabs to drivers on a daily or weekly basis. ... To own a cab in New York, you need a medallion—a metal shield displayed on the vehicle’s hood—and there are a fixed number issued by the New York City Taxi & Limousine Commission (TLC). Until very recently, medallions were a good thing to have a lot of. In 1947, you could buy one for $2,500. In 2013, after a half-century of steady appreciation, including a near-exponential period in the 2000s, they were going for $1.32 million. ... desperate medallion sellers are trying to fob off their little tin ornaments for as little as $650,000. ... This has had a profound effect on Freidman, whose net worth appears to be in free fall. ... The day the cap was defeated, 22 of Freidman’s companies, owning 46 medallions, filed for bankruptcy. ... “Honestly, I would love the piece not to be about ‘We had breakfast at Cipriani, then we walked over to his Park Avenue apartment, then we got into his Ferrari.’ ” ... If Uber is chiefly responsible for driving down the price of taxi medallions, Freidman played a big role in driving it up in the first place. Allow him to explain his strategy: “I’d go to an auction, I’d run up the price of a medallion, then I’d run to my bankers and say, ‘Look how high the medallions priced! Let me borrow against my portfolio.’ And they let me do that.” ... According to the Citibank bankruptcy filing, Freidman’s companies owe roughly $750,000 on each Citibank medallion.
Exposing the reasons we fail to understand the minds of others. ... No human being succeeds in life alone. Getting along and getting ahead requires coordinating with others, either in cooperation as friends, spouses, teammates, and coworkers, or in competition as adversaries, opponents, or rivals. Arguably our brain’s greatest skill is its ability to think about the minds of others to understand them better. ... the ways in which our sixth sense works well, but not nearly as well as we might think. The truth is that you are likely to understand much less about the minds of your family members, friends, neighbors, coworkers, competitors, and fellow citizens than you would guess. ... One of the biggest barriers to understanding others is excessive egocentrism. You can’t see into the mind of others because you can’t get over yourself. You can’t overcome your own experiences, beliefs, attitudes, emotions, knowledge, and visual perspective to recognize that others may view the world differently. Copernicus may have removed the Earth from the center of the universe, but every person on this planet is still at the center of his or her own universe. ... The important point is to relax a bit when others don’t seem to appreciate you as much as you think they should. ... The point here is that few of us are quite the celebrity that our own experience suggests we might be; nor are we under as much careful scrutiny from others as we might expect. ... Knowledge is a curse because once you have it, you can’t imagine what it’s like not to possess it.
During the Cold War, the Soviet military mapped the entire world, parts of it down to the level of individual buildings. The Soviet maps of US and European cities have details that aren’t on domestic maps made around the same time, things like the precise width of roads, the load-bearing capacity of bridges, and the types of factories. They’re the kinds of things that would come in handy if you’re planning a tank invasion. Or an occupation. Things that would be virtually impossible to find out without eyes on the ground. ... Given the technology of the time, the Soviet maps are incredibly accurate. Even today, the US State Department uses them (among other sources) to place international boundary lines on official government maps. ... one unlikely scholar, a retired British software developer named John Davies, has been working to change that. For the past 10 years he’s been investigating the Soviet maps, especially the ones of British and American cities. He’s had some help, from a military map librarian, a retired surgeon, and a young geographer, all of whom discovered the maps independently. They’ve been trying to piece together how they were made and how, exactly, they were intended to be used. The maps are still a taboo topic in Russia today, so it’s impossible to know for sure, but what they’re finding suggests that the Soviet military maps were far more than an invasion plan. Rather, they were a framework for organizing much of what the Soviets knew about the world, almost like a mashup of Google Maps and Wikipedia, built from paper. ... It’s easy now, in an age when anybody can whip out a smartphone and call up a street map or high-res satellite image of any point on Earth with a few taps, to forget how hard it once was to come by geospatial knowledge.
The music you hear in Magic City isn't the music you might expect at a strip club. Magic City Mondays are the most important nights in the most important club in the most important city in the hip-hop industry. Magic City is the place where you hear music before anyone else does, and where it is decided if that music gets played anywhere else. ... Occasionally, City Dollars threw some singles at the naked woman standing in front of us, the way an old man might absentmindedly feed some ducks the crust of his sandwich. ... On the bigger nights at Magic City, you can find Magic patrolling the room in a taupe suit, parting the clouds of hookah smoke with a wineglass in his fist. His trim hair going gray, his lantern jaw set. He played football on scholarship at Duke and at age 60 still has the bearing of a man who knows he's physically more powerful than other people. He is called Big Mag, pronounced "big maj" (Lil Magic is his son), and he is an elder statesman of the street. Atlanta is balkanized—you might not be welcome in Bankhead if you're not from there. But as the proprietor of Magic City, as a man who has, in his parlance, been running around in the streets for thirty years, it's different for Magic. He can pass safely into any zone he likes; he can talk to almost anyone like family. ... If hip-hop were Silicon Valley, Magic City would be the place venture capitalists would loiter, looking for talent.