Category Archives: markets

Cent Wise and Euro Foolish

Posted on by
Reply

Barron’s has an example, centered on Europe’s very own Wuhan Virus situation.

The EU economy shrank last year by 6.3%, according to the latest EU forecast, published on Thursday. That amounts to about €877 billion ($1.1 trillion) of lost gross domestic product last year. Or about €17 billion a week.
Compared with this, the total bill of vaccines procured until now by the EU—based on contracts signed, and vaccine prices confidential in principle but tweeted last December by the Belgian health minister—would amount to €20.5 billion.

The finally agreed vaccine bill amounts to a bare day-and-a-half over a week’s lost GDP—and how many lives.

While Barron’s writes its own price-is-no-object foolishness—When dealing with the pandemic, vaccines are quite literally priceless—the EU plainly wasted ‘way too much time, money, and lives, quibbling over relative pennies.

An outcome of the European Union’s foolishness:

20% of the UK population has already received at least a shot of one of the three [EU- and British-]approved inoculations—the Pfizer-BioNTech, AstraZeneca-Oxford, and Moderna vaccines. More than 13% of Americans are in a similar situation—but barely more than 4% of Europeans[.]

Another Example

Posted on by
Reply

…of the folly of doing business with companies domiciled inside the People’s Republic of China.

The particular company is Ant, a financial institution that PRC regulators lately decided its owner Jack Ma was getting too impudent regarding government actions—was getting too big for his britches—so the regulators blocked Ant from going public unless and until it massively reorganized and at least to significant extent downsized.

Now let’s back up in time a little bit.

In 2018, an exclusive group of global private-equity firms and mutual-fund managers including Silver Lake, Warburg Pincus LLC, Carlyle Group Inc, and T Rowe Price Group Inc took part in a coveted fundraising by Ant that raised $14 billion and minted the financial-technology giant as the world’s most valuable startup.
More than $10 billion of the money came from international investors, which bought shares in an offshore shell company set up by Ant to raise funds in US dollars. The unusual arrangement came about because in order to secure a payment license to operate Alipay, its highly popular mobile app, Ant had to be domiciled in mainland China. But that also limited the company’s ability to raise funds directly from foreign investors.

That’s the why. Now the what.

The global investors agreed to terms that were highly favorable to Ant, and which limited their ability to cash out if the company didn’t end up going public, according to people familiar with the matter. Ant also didn’t provide a listing time frame or guarantee investors a return while it stayed private, the people added.
The foreign investors didn’t receive any voting rights in Ant…. None was given a seat on Ant’s board.

They can’t recoup their investment; they didn’t even get a say in the governance of the company. Just “Here’s a boatload of money. Y’all have a gud time, y’hear?”

Now that was an exceedingly dumb thing for those investors, supposedly experienced in investing, in international finance, and in investing in PRC businesses, to agree. But the larger thing is demonstrated by the PRC government men’s behavior: investing in a PRC business, or investing inside the PRC, is exceedingly dumb.

That’ll be the Day

Posted on by
Reply

Ford Motor Co is going to switch to Alphabet’s Android for the software to drive its cars’ displays, beginning in 2023. I can tolerate that, mostly, even if it is Alphabet.

Here’s the kicker, though [emphasis added].

Ford also intends to work with Alphabet Inc’s Google for cloud services to help the auto maker develop in-car features and manage the reams of data streaming from its vehicles.

And

Ford, GM, and others are now working with Google to offer Android as built-in software, a move that allows owners to download apps directly to their vehicle’s tabletlike display….
Auto makers are mobilizing to offer in-car services to customers that would allow the companies to collect recurring revenue streams….

I don’t need tracking software in my vehicles, and I don’t need mechanisms to suck ever more money out of me via my vehicles.

It’ll be a cold day in a warm place before I’ll let any car of mine connect to the Internet.

Full stop.

Alphabet Strikes Again

Posted on by
Reply

Alphabet, through its wholly-owned Google’s wholly-owned YouTube, has censored The Epoch Times, barring the news outlet from its YouTube channel and expelling it from YouTube’s Partner Program, through which The Epoch Times monetized much of its output.

Alphabet claims the news outlet violated its subsidiary’s subsidiary’s “Community Guidelines.” Its YouTube spokesman said,

All channels on YouTube need to comply with our Community Guidelines, and in order to monetize, channels must comply with the YouTube Partner Program policies, which include our Advertiser-Friendly Guidelines. Channels that repeatedly violate these policies are suspended from our partner program.

The spokesman declined to say how the guidelines had been violated, or what output from The Epoch Times had been deemed wanting.

Of course, if Alphabet got specific, it would have to explain its censorship.

Diversity vs Diversity

Posted on by
Reply

Nasdaq—the tech-oriented stock exchange (no irony there)—is demanding companies listed with it

appoint within the next four years no fewer than two “diverse” directors: at least one woman, and one person from an underrepresented racial or ethnic group or someone who identifies as LGBTQ. Any company failing this requirement would be obligated to explain why.

The SEC must approve the demand before it has legal effect, but look for the Biden SEC to grant that.

Nasdaq, and the rest of the social justice warrior-ettes and virtue-signalers, miss the point of diversity, though. Or they don’t miss the point; they just don’t care.

Diversity of thought, diversity of approaches to problem solutions, most assuredly is something desperately needed in the boardroom. And in the C-suites, in middle management, on the production floor. And in schools, legislatures, and other political entities. (Voucher and charter schools already have this kind of diversity, in the main.) And in the mainstay of our private economy, mom-and-pop and other small businesses. Diversity of irrelevant characteristics like race, gender, or anything other will fall out of hiring for diversity of thought.

That’s even the logical outcome of those who push for diversity based on those irrelevant characteristics: all men are fundamentally equal in capability, these worthies say, regardless of color, gender, or….

Diversity done for the sake of diversity of race, gender, any other form, however, is just bigotry for the sake of bigotry, regardless of claimed purpose for the bigotry.