National Intelligence Council - Global Trends: Paradox of Progress [Main Report] 80min

Global Trends and Key Implications Through 2035
- The rich are aging, the poor are not.
- The global economy is shifting.
- Technology is accelerating progress but causing discontinuities.
- Ideas and Identities are driving a wave of exclusion.
- Governing is getting harder.
- The nature of conflict is changing.
- Climate change, environment, and health issues will demand attention.
These trends will converge at an unprecedented pace to make governing and cooperation harder and to change the nature of power—fundamentally altering the global landscape. Economic, technological and security trends, especially, will expand the number of states, organizations, and individuals able to act in consequential ways. Within states, political order will remain elusive and tensions high until societies and governments renegotiate their expectations of one another. Between states, the post-Cold War, unipolar moment has passed and the post-1945 rules based international order may be fading too. Some major powers and regional aggressors will seek to assert interests through force but will find results fleeting as they discover traditional, material forms of power less able to secure and sustain outcomes in a context of proliferating veto players.

KKR - Outlook for 2017: Paradigm Shift 75min

We view Donald Trump’s ascendancy to the Presidency of the U.S. as confirmation of a political and economic paradigm shift that started with Brexit but is likely to continue for the foreseeable future, including elections across Europe in 2017. Consistent with this view, we believe that there are four major potentially secular changes that all investment professionals must consider: fiscal stimulus over monetary, domestic agendas over global ones, deregulation over reregulation, and a broadening of outsized volatility from the currency markets to include global interest rate markets. The good news is that many of our highest conviction investment themes for 2016, including the ongoing slowdown in global trade, had already begun to capture this sea change in macro and geopolitical trends. At the same time, however, in certain areas our macro preferences have evolved of late in response to the “new” reality that we now live in. As such, we have used this outlook piece to challenge conventional investment wisdom, and in some instances, “adjust our sails.” In terms of asset allocation preferences for 2017, we are still probably most excited by what we see in Private Credit on a risk-adjusted basis. We also believe that Real Assets, particularly those with yield and growth, can prosper in the macro backdrop that we envision. Meanwhile, we are now balanced in our outlook on Equities versus Credit, but in both asset classes, we continue to suggest selling Simplicity and buying Complexity. Overall, though, we do not lose sight of the fact that we are undergoing a paradigm shift, and often these types of regime changes do not always transition smoothly. As a result, we maintain our long-held approach of seeking to monetize aggressively the periodic dislocations that inevitably occur in a world of increasing geopolitical uncertainty and macro instability.

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Financial Times - Ed Thorp: the man who beat the casinos, then the markets 7min

A mathematical prodigy, he worked out how to “beat the dealer” at blackjack while a postdoctoral student at MIT. After he published a book in 1962 revealing how to count cards, he became so famous that casinos banned him from playing — he says one even resorted to drugging him. Many changed their rules to thwart people using his counting system. ... Next came an attempt to beat roulette, using a contraption tied to his foot that is now described as the world’s first wearable computer; after that, an expedition into Wall Street that netted hundreds of millions of dollars. ... Thorp’s then revolutionary use of mathematics, options-pricing and computers gave him a huge advantage. ... “Adam Smith’s market is a whole lot different from our markets. He imagined a market with lots of buyers and sellers of things, nobody had market dominance or could impose things on the market, and there was a lot of competition. The market we have now is nothing like that. The players are so big that they control the levers of financial policy.” ... “One of the things that’s served me very well in life is having an extraordinary bullsh*t detector.”

Foreign Policy - Backing Into World War III 18min

Think of two significant trend lines in the world today. One is the increasing ambition and activism of the two great revisionist powers, Russia and China. The other is the declining confidence, capacity, and will of the democratic world, and especially of the United States, to maintain the dominant position it has held in the international system since 1945. As those two lines move closer, as the declining will and capacity of the United States and its allies to maintain the present world order meet the increasing desire and capacity of the revisionist powers to change it, we will reach the moment at which the existing order collapses and the world descends into a phase of brutal anarchy, as it has three times in the past two centuries. The cost of that descent, in lives and treasure, in lost freedoms and lost hope, will be staggering. ... Where exactly we are in this classic scenario today, how close the trend lines are to that intersection point is, as always, impossible to know. Are we three years away from a global crisis, or 15? That we are somewhere on that path, however, is unmistakable. ... Both seek to restore the hegemonic dominance they once enjoyed in their respective regions. For China, that means dominance of East Asia, with countries like Japan, South Korea, and the nations of Southeast Asia both acquiescing to Beijing’s will and acting in conformity with China’s strategic, economic, and political preferences. ... For Russia, it means hegemonic influence in Central and Eastern Europe and Central Asia, which Moscow has traditionally regarded as either part of its empire or part of its sphere of influence. Both Beijing and Moscow seek to redress what they regard as an unfair distribution of power, influence, and honor in the U.S.-led postwar global order. ... The democratic order has weakened and fractured at its core. Difficult economic conditions, the recrudescence of nationalism and tribalism, weak and uncertain political leadership and unresponsive mainstream political parties, and a new era of communications that seems to strengthen rather than weaken tribalism have together produced a crisis of confidence not only in the democracies but in what might be called the liberal enlightenment project. That project elevated universal principles of individual rights and common humanity over ethnic, racial, religious, national, or tribal differences. It looked to a growing economic interdependence to create common interests across boundaries and to the establishment of international institutions to smooth differences and facilitate cooperation among nations. Instead, the past decade has seen the rise of tribalism and nationalism, an increasing focus on the Other in all societies, and a loss of confidence in government, in the capitalist system, and in democracy. ... Both the crises of the first half of the 20th century and its solution in 1945 have been forgotten. As a consequence, the American public’s patience with the difficulties and costs inherent in playing that global role have worn thin.

Bloomberg - Does Stephen Miller Speak for Trump? Or Vice Versa? 13min

Miller’s resiliency after fumbling the refugee ban offers a lesson in how to survive the Darwinian world of Trump’s White House. To win favor, you must amplify Trump’s belief that he’s already accomplished great things; defend even his most outrageous claims as self-evidently correct; and look sharp, while projecting unshakable self-confidence. ... Under Sessions, Miller was busy assembling the elements of a restrictionist “America First” nationalism long before Trump arrived on the scene. Today he has a heavy hand, along with Bannon, in crafting Trump’s policy plans and executive orders. Miller also drafts the president’s major speeches, including the one Trump will deliver to Congress on Tuesday night. When Miller goes on television to defend Trump's words, he’s often defending his own writing. In a sense, Trump is giving voice to Miller as much as the other way around. ... While economists generally agree that tighter labor markets cause wages to rise, Miller’s plan risks stunting overall economic growth. ... Economic nationalism, as defined by Trump’s advisers, would seize the levers of government and the presidential bully pulpit to direct resources to helping marginalized U.S. workers.

The Economist - Parkageddon: How not to create traffic jams, pollution and urban sprawl 9min

Parking can seem like the most humdrum concern in the world. Even planners, who thrill to things like zoning and floor-area ratios, find it unglamorous. But parking influences the way cities look, and how people travel around them, more powerfully than almost anything else. Many cities try to make themselves more appealing by building cycle paths and tram lines or by erecting swaggering buildings by famous architects. If they do not also change their parking policies, such efforts amount to little more than window-dressing. There is a one-word answer to why the streets of Los Angeles look so different from those of London, and why neither city resembles Tokyo: parking. ... For as long as there have been cars, there has been a need to store them when they are not moving—which, these days, is about 95% of the time. Washington, DC, had a parking garage in 1907, before Ford produced its first Model T. But the most important innovation came in 1923, when Columbus, in Ohio, began to insist that builders of flats create parking spaces for the people who would live in them. “Parking minimums”, as these are known, gradually spread across America. Now, as the number of cars on the world’s roads continues to grow (see chart), they are spreading around the world. ... Free parking represents a subsidy for older people that is paid disproportionately by the young and a subsidy for the wealthy that is paid by the poor.

Bloomberg - Uncovering the Secret History of Wall Street’s Largest Oil Trade 12min

Betting that oil prices were about to crash was an audacious wager, one made all the more remarkable by the individuals behind the deal—civil servants with unassuming titles such as “director general of fiscal planning.” In the lucrative oil business, a profession known for its generous compensation, these government employees were probably the worst-paid stiffs around. Yet the men from Hacienda—so called still, even though women are sometimes in the room—proved prescient in predicting a crash. ... In December 2009 the four investment banks involved in the deal wired the proceeds of the wager back to Mexico. Official records tracking the money that landed in Account No. 420127 at state-owned Nacional Financiera bank show the tidy sum ­Mexico made: $5,084,873,500. ... Despite its size, impact, and huge fees, the deal is one that few people, even in the energy industry or on Wall Street, know much about. Painstakingly, the world’s 12th-largest oil producer and its bankers have cloaked the program in secrecy to prevent others—namely trading houses and hedge funds—from front-running Mexico’s orders.

ESPN - Sin City Or Bust 26min

It has always been easy to underestimate Mark Davis. After all, he is known for his wacky bowl cut and silver-and-black suits and for managing the Raiders from the bar at a P.F. Chang's. Since his Hall of Fame father, Al, died six years ago, Davis has been an afterthought in league circles, easy to malign and hard to take seriously. ... Adelson considered the Raiders' move a chance to help him shift a windfall of public money away from a competitor's convention center renovation -- and a chance to enhance his legacy by delivering an NFL franchise to his home city, sweetened by a stake in a gleaming, state-of-the-art $1.9 billion domed stadium and, perhaps, a piece of the team. ... What no one could see then is that, after making good on his word by delivering an American-record $750 million in public funds for the stadium and pledging $650 million of his own money, Adelson would end up furious a year later, feeling that Mark Davis -- the goofy Mark Davis who "surprises people if he can roll out of bed and put on his pants," as a team owner says -- had completely and utterly fleeced him.

Bloomberg - Is the F-35 a Trillion-Dollar Mistake? 13min

The ambition to create the version of the F-35 that I watched on the tarmac at Patuxent River—one that can make short takeoffs and vertical landings—was what got the fighter jet’s development under way in the 1980s. The Defense Advanced Research Projects Agency (Darpa), the Pentagon’s tech arm, began working at the Marine Corps’ behest on an improved version of the Harrier, a crash-prone vertical-landing jet of British design. According to a Pentagon history of the F-35, Darpa quietly sought assistance from a research and development arm of Lockheed Martin known as the Skunk Works. By the early 1990s, the Darpa-Skunk Works collaboration had produced preliminary concepts, and the Marine Corps began pressing Congress for funding. The Air Force and Navy insisted that they, too, needed stealthy, supersonic fighters to replace aging Cold War-era models. Out of this clamoring grew a consensus that the only way to afford thousands of cutting-edge fighters was to build a basic model that could be customized for each service. ... The degree of commonality among the three versions of the F-35—the shared features—turned out to be not the anticipated 70 percent but a mere 25 percent, meaning that hoped-for economies of scale never materialized. A pattern of continual reengineering resulted in billions of dollars in cost overruns and yearslong delays.

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.

New York Magazine - How the Self-Esteem Craze Took Over America 18min

At root, this national obsession was mostly the work of a very eccentric politician: John Vasconcellos. Vasconcellos, who died in 2014, was a California state legislator for 38 years. In his obituary, the San Jose Mercury News described him as a “famously rumpled bear-of-a-man” who was “colorful, witty, brilliant, angry, intellectual and elegantly foul of mouth.” Most of all, though, he was a nonconformist — during one three-year stretch, he decided to just let his hair grow and grow and grow — and his nonconformity frequently took on a decidedly Californian hue. Vasconcellos was an idealist who was convinced that humans had untold, untapped greatness, but it was an idealism driven in part by a bevy of personal demons and a long-running battle to control his anger problems. He was quite public about his varied attempts at self-improvement, which ranged from obscure forms of therapy to the teachings of the New Age Esalen Institute in Big Sur. ... Somewhere along the way, Vasconcellos discovered what was by then a good-size body of psychological research on self-esteem. It showed that people with high versus low self-esteem reacted in different ways to various challenges and instances of adversity ... This was a career-defining find for Vasconcellos. The logic was simple: If low self-esteem is tied to so many maladaptive responses, to so many forms of underachievement and bad behavior, then surely raising kids’ (and other’s) self-esteem could bring with it untold benefits. Soon, Vasconcellos was lobbying Sacramento to launch a statewide self-esteem commission to study the public-policy implications of self-esteem. ... little published evidence supporting Vasconcellos’s ideas. In some areas, high self-esteem actually correlated with worse behavior — some criminals, it turns out, actually view themselves quite favorably.

Bloomberg - The Mad Cheese Scientists Fighting to Save the Dairy Industry 10min

Americans eat 35 pounds of cheese per year on average—a record amount, more than double the quantity consumed in 1975. And yet that demand doesn’t come close to meeting U.S. supply: The cheese glut is so massive (1.3 billion pounds in cold storage as of May 31) that on two separate occasions, in August and October of last year, the federal government announced it would bail out dairy farmers by purchasing $20 million worth of surplus for distribution to food pantries. Add to that a global drop in demand for dairy, plus technology that’s making cows more prolific, and you have the lowest milk prices since the Great Recession ended in 2009. Farmers poured out almost 50 million gallons of unsold milk last year—actually poured it out, into holes in the ground—according to U.S. Department of Agriculture data. In an August 2016 letter, the National Milk Producers Federation begged the USDA for a $150 million bailout. ... That Taco Bell is developing its cheesiest products ever in the midst of an historic dairy oversupply is no accident. There exists a little-known, government-sponsored marketing group called Dairy Management Inc. (DMI), whose job it is to squeeze as much milk, cheese, butter, and yogurt as it can into food sold both at home and abroad. ... the group has been the hidden hand guiding most of fast food’s dairy hits—a kind of Illuminati of cheese—including and especially the Quesalupa.

Wired - Inside Cuba’s D.I.Y. Internet Revolution 17min

In Cuba, where Wi-Fi is both slow and terrible, you will be an emissary from the future, a hint of the degeneracy to come. You’re a full-on mainlining internet junkie with the world’s uproar piped into your head 24/7, your emotional landscape terraformed and buffeted by whatever some narcissist just posted on Instagram or some windbag on Twitter. But like the “not even once” warnings around drugs like meth, you know that after the internet is in Cubans’ pockets, it’s over. Even backward, bitter-ender communist Cuba will become part of the vast data Borg ... The real irony is that if the internet does topple the government and bring democracy to this democracy-starved island, it’ll happen just as democracy itself is being undone by Facebook and every other filter-bubble-­creating, political-polarization-amplifying, algorithm-optimized feed. But we’re getting ahead of ourselves, and also oversimplifying, because the Cubans—the very resourceful Cubans—haven’t exactly been sitting around sipping mojitos as the digital revolución passed them by. They have workarounds. Oh, do they have workarounds. ... the first workaround. Every week, more than a terabyte of data is packaged into external hard drives known as el paquete semanal (“the weekly package”). It is the internet distilled down to its purest, most consumable, and least interactive form: its content.

Defense One - What the Largest Battle of the Decade Says About the Future of War 10min

The bloody battle to wrest Mosul from ISIS was the world’s largest military operation in nearly 15 years. ... As Iraq looks to rebuild, and tens of thousands of Moslawis return to their homes—or what’s left of them—ISIS is still holding onto territory south and west of Mosul. ... If the U.S. military has learned anything about Iraqi insurgencies over the past 15 years, it’s that violence will likely return to Mosul, as it has on occasion in Baghdad—which the group never seized. ... On top of that is the ISIS presence in Syria, where an entirely separate large-scale operation has been progressing for months. The target: the group’s de facto headquarters in Raqqa. Beyond that, ISIS also maintains strongholds south of Raqqa in the Euphrates River city of Deir Ez-Zour, and some 200 kilometers west, around the ancient city of Palmyra. ... Which is all to say: the battle for Mosul may soon be over, but the war against ISIS — already a generational conflict — is far from finished.

Politico - What’s It Like to See a Democracy Destroyed? 26min

What’s it like to watch a country implode? To see a democracy destroyed and an economy crater? ... Since 2014, American journalist Hannah Dreier has documented just that in Venezuela, once one of the world’s wealthiest nations and still home to what are believed to be the planet’s largest oil reserves. She wrote for the Associated Press about what it was like to live in a place with the world’s highest murder rate—and the world’s highest rate of inflation. About the breakdown of hospitals and schools, and how the obesity epidemic that plagued a rich country was quickly replaced with people so hungry they were rooting through the garbage on her doorstep. ... Most of the time, few paid attention, at least in part because Dreier was the last U.S. journalist even to get a work visa to live in Venezuela; when she moved there to cover the story, she says, “I felt like I had walked across a bridge as it was burning behind me.”

Wired - An Oral History Of The DARPA Grand Challenge, The Grueling Robot Race That Launched The Self-Driving Car 10min

On March 13, 2004, a gaggle of engineers and a few thousand spectators congregated outside a California dive bar to watch 15 self-driving cars speed across the Mojave Desert in the first-ever Darpa Grand Challenge. (That’s the Defense Advanced Research Projects Agency, the Pentagon’s skunkworks arm.) Before the start of the race, which marked the first big push toward a fully autonomous vehicle, the grounds surrounding the bar teemed with sweaty, stressed, sleep-deprived geeks, desperately tinkering with their motley assortment of driver­less Frankencars: SUVs, dune buggies, monster trucks, even a motorcycle. After the race, they left behind a vehicular graveyard littered with smashed fence posts, messes of barbed wire, and at least one empty fire extinguisher. ... What happened in between—the rush out of the starter gate, the switchbacks across the rocky terrain, the many, many crashes—didn’t just hint at the possibilities and potential limitations of autonomous vehicles that auto and tech companies are facing and that consumers will experience in the coming years as driverless vehicles swarm the roads. It created the self-­driving community as we know it today, the men and women in too-big polo shirts who would go on to dominate an automotive revolution.