December 9, 2015
In our view, successfully divining the trajectory of markets today has a great deal to do with properly separating the bountiful amounts of information and data we have access to into that which is genuinely useful and that which serves to distract. As a case in point, while we have indeed weighed in on this debate ourselves, the endless discussions about the precise timing of Federal Reserve policy rate lift-off receive far too much attention from investors and the media. Indeed, we think less of a focus on transitory issue like this, and more attention paid to longer-term market influences such as demographic trends and technological change can go some distance toward improving an investment process longer-term. To that end, in this edition of our market outlook we briefly examine a set of influences on markets that we think hold meaningful importance longer-term (demographics, technology, policy evolution and risk, liquidity, and valuation), while at the same time dispelling a set of assertions that we believe are either over-emphasized or mistaken. ... The days of a simple risk-on/risk-off dynamic, depending on whether policy stimulus was waxing or waning, are likely behind us. ... the time may finally have come when carry-focused investments may now be priced as attractively as beta (or down-the-capital-stack) instruments, so investors can selectively search for opportunities there. As described above, though, there are some tail risks in markets, so care is still required. And, perhaps most importantly, investors would do well to tune out the endless streams of noise generated by financial market commentators and focus on the secular themes likely to both endure and help create long-term value.
Here there are rows upon rows of green–some 70,000 lush acres of water-hungry pistachio and almond trees. ... Their oasis has plenty of water, the result of relentless opportunism that has given their orchards access to more water than nearly any other farm during the worst drought on record in California’s history. The Resnicks use at least 120 billion gallons a year, two-thirds on nuts, enough to supply San Francisco’s 852,000 residents for a decade. They own a majority stake in the Kern Water Bank, one of California’s largest underground water storage facilities, which they got fairly but sagely from the government 20 years ago. It is capable of storing 500 billion gallons of water. They have also spent at least $35 million in recent years buying up more water from nearby districts to replenish their supplies. ... their company, renamed Wonderful in June, owns 32,000 acres of California citrus, flower-delivery service Teleflora, POM Wonderful pomegranate juice and Fiji Water, which collectively brought in $3.8 billion in sales last year. ... The Resnicks met in 1970 when Stewart came looking for marketing help for the janitorial business. He led her on, and after several meetings she bluntly asked whether she was going to get the account or not. Also divorced with children, he told her that he wanted to start a relationship instead. They married and in 1979 bought Teleflora, a failing flower-delivery service. ... Stewart bought his first parcel of farmland in California’s central valley in 1978 as a hedge against inflation. Lynda then took the fruits and nuts of their labor and marketed the heck out of them.
A new arms race in our skies threatens the satellites that control everything from security to communications ... the activities of the mystery “ghost” satellite have given many in the defence and intelligence community pause for thought. ... Space, military officials like to say, is the ultimate higher ground. Since the cold war ended, however, it has been a largely uncontested territory. In January 1967, the US, UK and USSR became the first signatories to the Outer Space Treaty. In it, they committed to keeping the moon free of military testing and not putting weapons of mass destruction into orbit. China joined the pact in 1984. Another 100 states are now signed up. ... Almost every country with strategically important satellite constellations and its own launch facilities is considering how to defend — and weaponise — their extraterrestrial assets. ... Satellites are fragile things: a nudge to their orbit, a tilt of their solar panels towards the sun, a laser blast directed at their sensors or a projectile casually fired into their path are all capable of wreaking permanent, irreversible damage. ... While developed societies are becoming more dependent on it than ever before for almost every aspect of their digital economies, their grip on the technologies that have given them global strategic dominance is slipping. And as more countries around the world look to maximise their military advantages, space is becoming the most obvious domain to contest. ... The 1967 Outer Space Treaty had one glaring omission: it has no limits on the use of conventional weapons. Even as militaries around the world work hard to build their space weaponry arsenals, many are now wondering whether the treaty needs to be broadened.
In the last weeks, WIRED has obtained the strongest evidence yet of Satoshi Nakamoto’s true identity. The signs point to Craig Steven Wright, a man who never even made it onto any Nakamoto hunters’ public list of candidates, yet fits the cryptocurrency creator’s profile in nearly every detail. And despite a massive trove of evidence, we still can’t say with absolute certainty that the mystery is solved. But two possibilities outweigh all others: Either Wright invented bitcoin, or he’s a brilliant hoaxer who very badly wants us to believe he did. ... Wright’s blogging and leaked emails describe a man so committed to an unproven cryptocurrency idea that he mortgaged three properties and invested more than $1 million in computers, power, and connectivity—even going so far as to lay fiberoptic cables to his remote rural home in eastern Australia to mine the first bitcoins. His company, Tulip Trading, built two supercomputers that have officially ranked among the top 500 in the world, both seemingly related to his cryptocurrency projects. (Wright seems to enjoy tulip references, a likely taunt at those who have compared bitcoin to the Netherlands’ 17th century “tulip bubble.”)
Why NBC, CBS & FOX’s sports networks have all failed in their attempts to shoot down the Mothership. ... moves like that suggest FS1 remains blind to repeating its mistakes all over again, trying to replicate ESPN’s success by bringing in former Bristol employees, and copying The Worldwide Leader’s shows. ... there are A LOT of sports fans out there that really hate ESPN and would love an antidote to the “Embrace Debate” culture that has spread to SEVEN daily debate shows on the network. Those fans just haven’t found an alternative yet. ... These suggestions may fly in the face of conventional television programming wisdom, but pretty much every single executive instinct of the suits at CBS, NBC, and FOX has been wrong.