Category Archives: markets

Protecting US Technology

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The Trump administration is moving toward a set of rules that would heavily restrict the People’s Republic of China’s ability to acquire American technology-developing companies and American technology.

Of course, there are objections to protecting our stuff.

Industry groups…are mainly concerned that the export controls could negatively affect their businesses by preventing them from using their technological edge.

If such groups were truly serious about this, they’d be truly serious about hardening their member companies’ facilities against hacking.

And

While many object to the investment restrictions, they are seen as having less practical impact because Chinese investment has fallen off so drastically.

This is short-sighted to the point of being disingenuously so.  The PRC’s investment has fallen off because, through theft, hacking, and their extortionate requirement of “sharing” technology and inserting backdoors into core software as a condition of doing business in the PRC, they’ve largely caught up.  When we get our edge back, the PRC’s “investment” efforts will pick back up.  The restriction objectors know this.

Bad Bonds?

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Recall that Michigan State University agreed to pay $500 million to victims and associates of Larry Nassar’s sex abuse victims while he was pretending to treat our women gymnasts’ injuries.

Now the school intends to float bonds to raise the money to pay the bill.

Were I an investment advisor—which I’m not, nor do I play one on the radio—I’d advise against buying these bonds; I’m not satisfied Michigan State will be able to pay them off in the end, even with OPM.

Aside from their investment quality, or lack, I also think it’s immoral to bail out the school until there has been a serious cleaning house of school management, from middle management layers all the way up through the top layer.  This house-cleaning must include the athletic department as well as HR, student affairs, extracurricular affairs, and the President’s office.  Especially in the latter and in the athletic department, no one should be left but the secretaries.

And none of this gets to the fact that the bond offering is just a cynical back-door effort to get taxpayers to pay for the school’s failure.  That’s also morally unacceptable.

And this:

[The school] is in talks with its insurers and has said it expects to recover at least some funds through them.

Is the school seriously suggesting that it bought insurance against the risk that its medical personnel would engage in sexual abuse?  I can think of no other way in which insurers would be liable for a payout here.

AHPs

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Association Health Plans are new plans that, by regulation, allow small businesses to band together across industries and state boundaries to form health insurance buying consortiums.  Using this larger size-generated buying power, they should be able to acquire cheaper, better tailored, more flexible plans for their employees, plans that those employees actually will want.

However.

The left says association plans are junk insurance that will blow up ObamaCare.

Some AHPs likely will be; that’s a fact of life in any market, free or centrally planned. However, a free market is self-regulating and quickly so; junk plans will be few and far between.  Blow up Obamacare?  That’s win-win.

Heads Up

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As the People’s Republic of China responds to President Donald Trump’s tariffs, motivated in part by the PRC’s cyber-theft of American technology and proprietary information and the PRC’s extortion of the same and its demand for backdoors into foreign business’ (including especially American) core software as a condition of doing business in the PRC, buckle up, indeed, as the article at the link above suggests.

The PRC will do far more than this, though, as it attempts to coerce the US in the pursuit of its Warring States strategy.

Beijing retaliated against planned US tariffs on Chinese goods by targeting high-value American exports—including farm products, cars, and crude oil—bringing the world’s two biggest economies closer to an all-out trade war.

That’s just the beginning.  If we don’t abjectly surrender, the PRC will expand their conflict with open cyber-warfare against us, with rapidly expanding attacks on our government and our infrastructure with denial of service attacks against our financial structure, our distribution grids, DoD, State, OMB (again), etc.  These attacks also will include planting false data wherever they can and with simple vandalism on our key databases.

The PRC also will open the economic spigots with northern Korea and actively facilitate its final acquisition of a capability to deliver its stockpile of nuclear weapons.

The PRC will object and seek to prevent the Republic of China’s businesses from altering their supply chains, which currently involve PRC companies, and they will in the end openly attack—politically, economically, even militarily—the RoC.

Tariffs may or may not be the best way to fight the PRC’s war, but this is a struggle that we must win.  Lose, and we will find ourselves badly curtailed.  Recall that trillions of non-PRC-related trade sails to us through the South China Sea, which the PRC has claimed for itself and has been steadily militarizing.

What Hath Socialism Wrought

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This image, from a Deutsche Welle article on Venezuela’s inflation rate—which last month reached 24,571% year-on-year—says it all.

The word drawn on the 100 bolivar note (and yes, it’s a real note, and it’s actually that big) translates to “hungry.”  In the context, it means more broadly, “a widespread, intense, and prolonged shortage of staple foods that a population suffers.”

Hungry indeed, too.  A bit over two pounds of meat cost about 2 million bolivars (or did once, daily inflation is running at 2.4%), or €16.9 or $20, against a surgeon’s monthly salary of not even 6 million bolivars.  Meat, not steak in particular.  That’s some expensive hamburger or shank cut.

And, not to put too fine a point on it, that works out to a bit over three ounces of meat per day, with nothing left over for anything else: vegetables, rent, transportation, etc.  And that’s for a relatively well off man like the surgeon.  What about the middle class, or especially the poort.

This is reminiscent of what Joseph Stalin did to the Ukrainians and White Russians when he collectivized—socialized—the Soviet Union’s kulak farms.