Monthly Archives: June 2015

Reddit Users Eviscerate Entrepreneurship BS

Even though I lean Republican on many economic issues, small business, by in large, is for chumps and is a lousy way to make money due to the high start-up costs and high failure rate; furthermore, these ‘success stories’ touted, such as Steve Jobs, Bill Gates, and Mark Zuckerberg, are the exception and far from being the norm. Millennials, to their credit, see through the BS, as do I, as evidenced by the funny comments in refutation this this small-business/entrepreneurial slide which, like Gladwell Books, is full of hope, cherry-picked examples, survivorship bias, and a complete detachment from empirical and economic reality.

The comments are the best, and I have taken a screenshot of the highest-rated comments, all of which douse cold reality on the warm ‘you-can-do-it’ sentimentality that is pervasive on both sides of the political aisle, which unfortunately includes the right.

Yes, small business does sometimes lead to great innovations, but nowadays large business, with their large R&D budgets, are taking over the role of the small-business tinkerer. And, yes, small business does occasionally lead to great riches for their founders, as in the case Google and Apple, but at the individualistic level using cost/benefit analysis, due to the high rate of failure and high start-ups costs, small business is a bad way to make money, especially compared to buying the S&P 500 and or real estate. You can be comatose and make money with stocks & real estate, versus small business which is a lot of work.

From The Problem With Small Business:

The way you get rich is to buy and hold the S&P 500, buy Bay Area real estate, build a website that goes viral, or become an early employee or early investor of a company that becomes very valuable.

Other ways to get rich (or at least comfortably middle class) include:

-attaining a high position at an established company
-getting in early on a future multi-billion dollar start-up either as an employee or investor
-STEM job
-professorship (very hard to get tenure)
-specialized trades (elevator repair, die making, etc)
-specialized in-demand services (doctor, lawyer, accountant, etc)

But this is not the mythical ‘passive income’, which like the pot of gold at the end of the rainbow is sought but never found. It’s easier to just grind through the cubicle job, or buy & hold the S&P 500, than piss away tons of hours trying to get an online passive income using books, websites, affiliate marketing, blogs, and other time-consuming crap that doesn’t work for 99.9% of people.

The only way I could endorse small business is if the start-up costs are minimal and the profits are extremely high from the onset, or you can dupe a VC to write you ‘blank check’ – but otherwise, the ‘small’ in ‘small business’ belies the large start-up costs, which often requires large loans, leading to financial ruin when the business fails. With web 2.0, it costs little money to create the app and viral marketing can take care of the rest. The greatest web 2.0 successes – from Snapchat, to Facebook, Twitter, Uber, Pinterest, Dropbox, and AiR B&B – all spent very little – if any- on promotion, and most of these companies were already successful by the time they received VC funding.

But what about the success stories? Again, those are cherry-picked among a huge, hidden graveyard of unpublicized failures. Then you have the pesky role of IQ, which keeps popping up again and again, be it writing ability, stock trading, or small business success. What all of these successes have in common – with few exceptions – is that all the founders were brilliant, and not in a figurative sense (like how the word ‘genius’ is constantly being thrown about) but as measured by an IQ test, with these founders being among the smartest people in the world, or as I wrote in an earlier article, Telling Fairy Tales To Spare Our Feelings:

Like I mentioned before in a response to a Techcrunch essay by Jon Evans, the elephant in the room is IQ, and all of the aforementioned individuals, Zuck, Elon, Jobs, Gates.. etc, with the possible exception of Richard Branson, have very high IQs. But a simple search of the Quora page yielded not a single match for IQ among any of the replies. If you want to be as great as those people – while hard work and obsession does help – so to is being in the top .1% of IQ. Bill Gates got a near-perfect SAT score on the ‘hard’ pre-1995 test, corresponding to an IQ of 160 or so. While Woz is often credited as being the ‘brains’ of Apple, Jobs skipped many grades and still found his schoolwork super-easy, giving him time to ponder the wonders of technology. Elon Musk is a physicist/rocket scientist, applying his intellect in his role in Paypal, SpaceX, Solar City, and Tesla. Zuckerberg was a coding prodigy, creating websites as his peers were still struggling with simplifying fractions. Warren Buffett, who isn’t on the list, entered college early and knew more about finance than his professors. And this applies not just to technology, but writing (and a slightly different take), mathematics, trading, chess – any field that requires brain power, but more specifically, memorization and making inferences between disparate pieces of data – skills that IQ tests measure.

Also, although I’m bullish about the US economy and stock market, I’m bullish about the ‘biggest’ aspects of it, as part of the post-2008 ‘bigger is better‘ theme. This means I’m bullish on multinationals like JNJ, Microsoft, Google, Apple, and Facebook which, unlike small businesses, have cheap borrowing costs, wide moats, billions in revenues, and pricing power; I’m bullish on the biggest and most successful web 2.0 companies (Snapchat, Uber) and the most expensive real estate (Palo Alto).

Related:

The Daily View: IQ and Political Affiliation, Small Business, Obama, Healthcare, Women in STEM

Is small business failure & pessimism a sign of proactive economic policy & strong economy?

No Love For The High-IQ Basic Income

Yesterday I wrote an article defending MGTOW, which I later re-wrote because the original didn’t meet my quality standards.

It’s funny but not too surprising how some people get worked-up about the idea of a high-IQ basic income (and the topic of IQ in general), so much so that facts and logic go out the window, making it easy to counter the doubters because there is hardly any actual argument to counter – just emotion and popular leftist misconceptions about IQ that are easily refuted.

IQ is more important than many people want to believe/accept. In our increasingly competitive and technological economy and society, more than ever whether you succeed of fail/life outcomes seem to be influenced by IQ, with smarter people tending to rise to the top. The reality that some people by virtue of IQ are perhaps ‘better’ than others and therefore more likely to succeed is liable to provoke anger as this goes against the egalitarianism that teachers, culture and parents have brainwashed all too many into believing, and rather than accept these uncomfortable truths some people prefer to lash out at the messenger.

For those who don’t know, a summary of the high-IQ basic income and why I support it:

The high-IQ basic income is like a government Mensa that pays its members. It would cost less and have a higher ROI than a universal basic income (UBI). Depending on the requirements, only around 5% of the country would be eligible, so it would cost much less than a UBI. The advantage is that the money would have a higher ROI than a UBI because high-IQ people tend to be more productive and creative and therefore would put the money to use in ways that could boost the economy and improve society, such as starting businesses, coding, tinkering, producing art, and writing – activities that otherwise may not be possible if these smart people are too busy trying to make ends meet than thinking, thinking, and creating.

Some counter arguments I encountered:

Poor people tend to have lower IQs because they have less access to high-quality education, live in areas with higher pollution, the compounding effects of poverty, etc. Solving these problems with UBI and some other programs/policies would have a much higher ROI, no?

Not quite so, given the evidence that IQ is heredible, stable throughout life, and unmalleable. From Wikipedia:

Various studies have found the heritability of IQ to be between 0.7 and 0.8 in adults and 0.45 in childhood in the United States.[6][9][19] It may seem reasonable to expect that genetic influences on traits like IQ should become less important as one gains experiences with age. However, that the opposite occurs is well documented. Heritability measures in infancy are as low as 0.2, around 0.4 in middle childhood, and as high as 0.8 in adulthood.[10][20] One proposed explanation is that people with different genes tend to seek out different environments that reinforce the effects of those genes.[9]

A 1994 review in Behavior Genetics based on identical/fraternal twin studies found that heritability is as high as 0.80 in general cognitive ability but it also varies based on the trait, with .60 for verbal tests, .50 for spatial and speed-of-processing tests, and only .40 for memory tests.[6]

In 2006, The New York Times Magazine listed about three quarters as a figure held by the majority of studies,[21] while a 2004 meta-analysis of reports in Current Directions in Psychological Science gave an overall estimate of around .85 for 18-year-olds and older.[10]

And from Arthur Jensen’s infamous paper How Much Can We Boost IQ and Scholastic Achievement?, summarized by Wikipedia:

.[6] IQ tests are reliable measurements of a real human ability — what people generally describe as “intelligence” — that is important to many parts of contemporary life. Intelligence, as measured by IQ tests, is about 80 percent heritable. Intelligent parents are much more likely to have intelligent children than other parents. Remedial educational programs have failed to raise the measured intelligence of individuals or groups. Indeed, one of the most inflammatory sentences is the opener: “Compensatory education has been tried and apparently has failed.” The article generated extensive discussion and controversy both in the popular press[7] and in the academic literature

From Jensen’s paper, here are two passages that show how efforts to boost IQ through environment have failed:

The left keeps getting the cause and effect wrong. It’s like arguing that if doctors do enough circumcisions babies will eventually be born without foreskin.

Someone else counters:

you realize that one of the main reasons most people want basic income is specifically to provide for ‘other’ 95%… so that we don’t have to basically cull the population?
I am someone who is reasonably sure that I will be able to find gainful employment as long as such exists, but I have no illusions that my neighbors will just quietly starve to death with their families without causing me any undue inconvenience when I remain the only one on my block still able to afford food.
When such a scenario occurs, I can see only 3 general outcomes -
1) my neighbours burn my nice house down on my head, kill me and take my stuff
2) my private, just a bit less-starving or possibly automated, army kills them all
3) we all find a way to get them fed too even though the bother of proving them with the necessities of life is always going to be a net loss for me.
Of those 3 general outcomes, the third one seems less shit.
Tl,DR – Not arguing for UBI here, but any solution that provides for a mere 5% of humans is not a solution, it’s just epic fail. Our current system is already likely to provide for more than that.

A distinction must be made between a UBI, which is universal and without preconditions, and a ‘basic income’, which could have preconditions. A UBI has a much higher likelihood of failing than with preconditions, as I argue here. Inflation-adjusted entitlement spending keeps growing, and a UBI without preconditions would simply compound the existing spending problem.

I think most Americans, who will not qualify for the high-IQ basic income, will see the merits of the program rather than revolt. Most people accept that professional athletes, for example, make more money because they have a scarce skill that society finds valuable; having a high-IQ is also valuable and a scarce resource, and while there are more high-IQ people than professional athletes, the income allotted to each individual who qualifies under the high-IQ basic income would be much less than the paycheck that, say, Alex Rodriguez earns.

Others liken the high-IQ basic income to Nazism, but in all my reading I don’t recall the NSDAP having such a program. The Nazis were more concerned about racial purity than intelligence; second, the Nazis wanted purity – meaning expunging from society those who didn’t meet their strict standards. Our approach is much more humane – to create optimal socioeconomic environments for the cognitively exceptional – not to forcibly remove the less intelligent from society.

The Flynn Effect also came up as a rebuttal, as evidence for how environment can boost IQ scores. Not so fast. There is no actual consensus among the psychometrician community that the alleged rise in IQ scores is attributable to better test-taking ability or true gains in intelligence. It could be that people are getting better at taking the test due to better nutrition, but this does not prove their cognitive capacity (IQ) has increased. Kids who aren’t hungry will score better, which could explain why scores for the lower-end of the IQ distribution and in third world countries have risen, but this is not proof kids are smarter. They could just be operating at their full’ cognitive potential, instead of maybe 75%, thanks to a better environment.

There is evidence that the Flynn Effect has tapered-off in 1st-world countries, suggesting that a good environment will allow an individual to live to his or her full cognitive potential, but not exceed it:

The end of the Flynn effect? A study of secular trends in mean intelligence test scoresof Norwegian conscripts during half a century

The present paper reports secular trends in the mean scores of a language, mathematics, and a Raven-like test
together with a combined general ability (GA) score among Norwegian (male) conscripts tested from the mid
1950s to 2002 (birth cohorts c1935–1984). Secular gains in standing height (indicating improved nutrition and
health care) were also investigated. Substantial gains in GA were apparent from the mid 1950s (test years) to the
end 1960s–early 1970s, followed by a decreasing gain rate and a complete stop from the mid 1990s. The gains
seemed to be mainly caused by decreasing prevalence of low scorers.

There is some evidence IQ scores are actually declining:

British teenagers have lower IQs than their counterparts did 30 years ago

Tests carried out in 1980 and again in 2008 show that the IQ score of an average 14-year-old dropped by more than two points over the period.

Among those in the upper half of the intelligence scale, a group that is typically dominated by children from middle class families, performance was even worse, with an average IQ score six points below what it was 28 years ago.

The trend marks an abrupt reversal of the so-called “Flynn effect” which has seen IQ scores rise year on year, among all age groups, in most industrialised countries throughout the past century.

Flynn effect could also be endogenous, meaning that while IQs may be higher, IQ scores don’t rise throughout the persons’s life to suggest exogenous factors. This means Jensen’s argument about the futility of trying to boost IQ scores through intervention still holds. National IQ scores could be boosted through assortative mating, but environment-based programs for ‘first world’ countries are of limited effectiveness at boosting cognitive capacity and is the wrong approach. Environment will help an individual reach their full cognitive potential, but not exceed it, which is what the whole idea behind the high-IQ basic income is about. We already have the resources to challenge the cognitively average, but the cognitively exceptional are often underserved by society, especially in the public schools, where only a tiny percentage of the federal education budget is allotted to gifted programs.

The squandering of America’s most important resource, cognitive capital:

Screenshot taken from: Victims of Public Education By Donald Kordosky

Related:

The Great Debate: Automation, Jobs, Wealth Inequality, Basic Income, Post Scarcity

Sorry Middle Class, You’re Just Not That Important Anymore

With $21 Trillion, China’s Savers Are Set to Change the World

I guess this is why the decline of the middle class is not such a big deal to Wall St.

There are seven billion people in the world, of which only around 100 million constitutes ‘America’s middle class’.

Then you have the Pareto principle, in that the richest 20% contributes 80% to consumer spending. The richest consume the most; the poorest the least:

Booming foreign consumption, especially the Chinese luxury consumer:

You have all these rich foreign consumers compensating for any decline in US middle class consumption.

S&P 500 companies, web 2.0, apps, biotechnology…high-IQ industries and multinationals are doing just fine, even if middle class participation is lagging. This is because of exports and b2b (such as app companies selling advertising space to businesses), bypassing the middle class consumer altogether.

Foreign investment is helping to keep the US dollar high and interest rates low. Normally at this stage of such a strong recovery, interest rates would be at 2-4%, but insatiable foreign demand due to the ‘flight to safety’ and other factors is keeping rates low.

Unless you’re among the cognitive elite (top 1-5% of IQ), you may need to lower your expectations, sorry. Foreign competition, along with automation and outsourcing, is creating a ‘hollowing out’ of the middle – a lot of low-paying service sector jobs, combined with self-actualizing jobs at the top, but not much for the middle.

The problem is the skills taught in school are only good enough to be merely competent (and that was good enough a generation ago) but in our ‘average is over’ super-competitive economy, in many instances you need to be exceptional just to get your foot in the door.

Entrepreneurial endeavors, such as self-publishing, may not help much either since you need to be smart to succeed as an author, which according the normal distribution of IQ scores excludes 90% of the US population. Although the literacy rate of America is high, ability falls considerably once you go beyond the very basics. The same goes for re-training the workforce, in which the acquisition of increasingly technical skills is restricted by the cognitive limits imposed by biology. Eventually you may have a situation where any ‘middle class’ job that isn’t already automated or outsourced may be cognitively out of reach for the majority of Americans.

For regions such as the Bay Area, Seattle, Los Angeles and New York, where demand vastly exceeds supply, it will continue to suck being a renter, but being a homeowner or a landlord will continue to pay as prices keep rising. Home prices tend to be positively correlated with IQ, with ‘smarter’ regions having higher prices, greater rates of appreciation, and higher rent.

Globalization changes everything, creating winners and losers, but also changing the rules of macroeconomics.

Related: Wealthy foreigners bought $100 billion in US real estate

Redefining the American Dream

80% of U.S. adults struggle with joblessness, near-poverty, or reliance on welfare for at least parts of their lives, a sign of deteriorating economic security and an elusive American dream.

The America dream is alive and well for some, but mostly for those who who are smart enough to learn the skills that pay well – skills such as coding, apps, finance, engineering, math (STEM). For those of more modest intellectual means, the ‘American dream’ will remain elusive, as part of the broader post-2008 ‘hollowing out of the middle’ theme. In the post-2008 economy, the Bell Curve is more relevant than ever, in that some people may not be smart enough to fully participate in the recovery, which could explain the surge in entitlement spending to bring these people ‘up to speed’, similar to a remedial class. For example, if you want to be a writer, which is a job that typically doesn’t pay that well, you need the ability to write well, which according the the normal distribution of IQs would exclude about 80-95% of the population. While the literacy rate in America is high, ability drops off considerably once you go beyond the very basics. Good-paying jobs for the middle of the Bell Curve are becoming increasingly scarce, the result being a lot of dull/average people who can’t find decent employment for long stretches of time. Although a considerable amount of wealth has been generated since 2008, times are still trying for many.

From my article, The Smartist Era:

In his controversial but prophetic 1995 book The Bell Curve, Charles Murray attributes wealth inequality to cognitive stratification and the difficulties that the increasing complexities of modern life present to low IQ individuals, resulting in the delamination of society into a cognitive elite (which we call smarties) and everyone else. This couldn’t be more relevant today. Never before have the socioeconomic benefits of being smart and rich have been so great, or the disadvantages of merely being below-average been so grave and intractable. Perhaps we should take heed or at least acknowledge the prescience of Murray’s writings, instead of being so quick to dismiss it as ‘racist’.

There also shouldn’t be a single ‘ideal’ of the American Dream, but a ‘dream’ that varies according to IQ. For those on the left side of the Bell Curve, their dream could be as simple as watching Netflix, tweeting, or posting pictures on Facebook. For many people, these activities bring much enjoyment and are respectable and attainable life goals. Maybe they can work at fast food, Walmart, and other low-paying service sector jobs – but if salaried employment is not available, there is always temp work in the ‘sharing economy‘. But even passive consumption – be it updating your status on Facebook, streaming a TV show, or taking a selfie on Instagram – creates economic value, maybe more value than an overpaid job. For smarter people, who make up the bulk of the ‘creative class’, their ‘dreams’ could be more complicated such as home ownership, making a lot of money, scientific research, publishing, or retiring early.

Related: Billionaire: Your life is going to stink

In Defense of MGTOW, Part 2

Matt Forney’s anti-MGTOW article is going viral.

There are better targets – from feminists, to SJWs, to overpaid liberal arts professors – than MGTOW which, with the exception of some issues, is ideologically aligned with the Red Pill hegemony, and in many topics – such as feminism, political correctness, SJWs, or economics – MGTOW is almost indistinguishable from Red Pill. But the MGTOW choose a different, perhaps more introverted way of life and are less interested in ‘hooking up’ or ‘game’, and this is where the acrimony arises, reminiscent of the East Coast–West Coast hip hop rivalry of the 90′s where you have two groups that are fundamentally the same, but are constantly at each other’s throats over some small matters that got blown out of proportion.

I find the acronym MGTOW useful as a way of codifying a lifestyle and philosophy that eschews political correctness and other societal norms to instead ‘go your own way’ – both physically (to live as a self-sufficient individual) and philosophically (to believe in empirical reality as a guiding principle of life). This is similar to Ayn Rand’s Objectivism, which states that one’s moral purpose of life is to pursue happiness and fulfillment in a free-market system, that knowledge and understanding is attained through sensory perception, inductive reasoning and deductive reasoning – not faith or mysticism. The decision to ‘go your own way’ arises after one realizes that the empirical reality doesn’t align with the politically correct narratives that they were brought-up believing, so it behooves the intrepid and the curious to seek the truth and in doing so you ‘go your own way’. But for men who are living with their parents, in college, or renting and don’t yet have the financial means to ‘go their own way’ in the physical sense, MGTOW can also be a state of mind, similar to how Red Pill is both a philosophy and a lifestyle.

MGTOWs aren’t interested in dating not because of misogyny or because we’re ‘losers’, but because MGTOW is based on choosing empirical reality over societal norms, and the immutable biological differences between men and women, which is based on empirical evidence and scientific fact, makes meaningful relationships difficult. This biological friction, as well as the ‘misandry/Gynocentrism bubble’, is why so many men find themselves dragged through the mud of life-draining relationships. MGTOWs, who see men touch the stove and get burned, know not to touch the stove. Sometimes it’s better not to play if the game is rigged.

Related: In Defense of MGTOW

What is this site about?

A year later and I’m still not sure where ideologically this site falls under. It’s not quite libertarianism, it’s not really mainstream-conservatism, and it’s not fully neo reaction (NRx)…it some amalgamation. I find myself agreeing with NRx on anti-egalitarianism, anti-democracy, anti-SWJ, and biological realism, but I am pro-modernity. And I tend to agree with the GOP on economic and defense issues, but the GOP, like the left, tends to reject/ignore biological reality and biology/HBD-based solutions to socioeconomic problems. I agree with classical liberals and libtertarians on market issues and being pro-technology, but disagree on some civil-libertarian topics.

For example, the left is pro choice, but not to make the world better but because of a lack of self-control. The mainstream & Christian right believes every unborn life is sacred and equal (blank slate), but empirical evidence suggests otherwise. Not all life is sacred. So both sides get this issue wrong. In straying from the mainstream-right, I support HBD/biology-based programs to help improve society – from a utilitarian/pragmatist perspective – even if many, understandably so, find these ideas an affront to their sensibilities. Sometimes the best policy is the least popular policy. Look at TARP, for example, which has a huge success and produced a high ROI, but no one liked it, and contrast it with social security, which everyone likes, but is a big fiscal drain and will probably eventually become insolvent.

A major theme of this site is bearing witness to reality by debunking FUD, wishful thinking, and nonsense. That’s why I write these articles about economics, HBD, finance, web 2.0, and stocks…because there is just so much stuff out there in those specific topics that is wrong. You have experts – people who are paid a lot of money and have a large following – whose egos and personal biases make them blind to the glaring holes in their arguments. These flawed arguments are popular because many people want them to be true (like people want to believe the economy is weak, that the world is doomed, that IQ is meaningless, that capitalism is dead, that web 2.0 is bubble, or that rich people are the root of society’s problems), but these arguments crumple under empirical scrutiny.

I’m tired of the sensationalism that you find on these political and news outlets. For example, predictions last year that Ebola would cause a pandemic. What ever happened to the WHO’s predictions of ‘millions dead’? So much for that. It’s done to scare you so they, the media, can collect advertising dollars from the page views, and there’s nothing technically wrong with that in a capitalist system, but paying heed is a waste of time. That’s why after many years I stopped listening to right-wing talk radio, because all the host’s predictions of doom and gloom – as convincing as they sounded – never came true, including most recently Ebola, so I realized that reality and truth, wherever it may lie or whatever form it may take, could not be found there. Most importantly, we cannot lie to ourselves. And I think, whether it’s spreading fear about debt or doom and gloom about bubbles, we do ourselves a disservice when we have to create alternate realities because we don’t like our existing one.

Alt-right bloggers write a lot about preserving tradition. This site doesn’t have much of that because those those topics are done much better by other bloggers and because it’s almost become a lost cause. The right has had much more success at economic, gun, and defense issues than cultural ones. The GOP/right has tended to be pro-technology and pro-markets, in contrast to the Luddite leftist movements – but a combination of the 2008 financial problem and polarization of politics, especially following the election of Obama, has made the right more apprehensive about modernity…And there is the whole schism between the traditional/Christian/paleo right and the techno-libertarian/neo/pragmatic right, the later which embraces modernity and free markets. The Paleo right is more popular today than a decade ago, and you see evidence of this shift on mainstream sites like National Review, but I think history and present trends still favors the pragmatic right. That’s part of the problem with political labels – the definitions keep changing. Positions that the right supported as recently as 10 years ago, they want nothing to do with anymore. And you see the same shift on the left, with pro-trade, pro-technology liberals of the Clinton era ceding to the isolationist welfare liberals. The events of 2008 and the fallout of the Bush administration brought the palo cons and the welfare left closer on many issues.

Why am I optimistic about America, technology, and the economy when so many on the ‘alt-right’ are not? Because I believe my view is the one that is most aligned with the empirical evidence and secondly, from an HBD framework, when the American economy succeeds, so to do the best and the brightest that comprise it. I see America as something of an HBD success story – a place that through its institutions, it’s infrastructure, and its free market rewards high-IQ and productive people more so than anywhere else in the world, in spite of all of America’s flaws.

Ultimately, this site is about trying to find middle-ground between differing ideologies and beliefs, an À la carte approach, to not only understand the world better, but help devise solutions through incrementalism – small changes to modify existing policy to create socioeconomic conditions optimal to the creation of wealth and technological innovation, rather than completely overhauling the system we present have. But it’s also about not trying to fight the currents of reality – to accept the world as it is and make the most of it. That’s why for years I have been recommending buying stocks (stocks like Facebook, which is up 200% in the past 2 years) on the dips as a way to profit from the inevitable transition to a type 1 civilization. I would rather make money from these economic trends than sit on the sidelines and complain like a sore loser. Complaining is useless…it doesn’t get you anywhere in life. According to the economic data and other factors (that I explain my posts), the argument for doom and gloom is unconvincing. So until the collapse comes – assuming it ever does – I will continue to ride the currents of prosperity.

Related:

Neo Reaction & Techno-Libertarianism
WHY GREY ENLIGHTENMENT?
So, What Are You?

The Great Moderation

From Noah Smith: Big Economic Discovery! Booms Might Cause Busts

But in recent times, thanks to effective fiscal and fed policy and America’s economic exceptionalism, ‘booms’ have become increasingly prolonged and ‘busts’ very brief. The Great Moderation that began in 1982 has become a ‘greater moderation’ as inflation remains tame, economic growth steady, the dollar strong, and innovation, exports, consumer spending, and profits & earnings rising uninterrupted.

Here’s a chart showing how recessions have become rarer and briefer since the early 80′s:

It’s not that we need to be able to prevent bubbles or predict them – that’s asking too much – but instead we need the tools to keep crisis and downturns as brief and contained as possible – a skill that policy makers are surprisingly adept at. Bernanke and Geithner, who I dubbed ‘the competent duo’, saved the day, allowing Obama to unscrupulously take credit for the strong recovery. The liberal doom and gloom media always focuses on failures, so most people just assume that everyone in the fed or in Washington is inept when in fact there are competent people in command, again and again rising to the occasion when everyone else expects the worst; it’s just that no one in the media gives them credit. Failure and crisis sells subscriptions and gets clicks, not success.

Wealthy foreigners bought $100 billion in US real estate

More American exceptionalism: Wealthy foreigners bought $100 billion in US real estate

So much for the ‘post America’ era that many leftist pundits predicted in 2008 and 2009 – the exact opposite has happened. From surging stocks, to the unending inflow of foreign capital, to a strong dollar, America has been emboldened, it’s economic hegemony only strengthened in recent years compared to the rest of the world, with the exception of China and India, which has fallen behind or stagnated. America is not just pulling ahead of the rest of the world, it’s running victory laps. As middle-America, bombarded with doom and gloom from the sensationalist media, gripe about the lousy labor market, flat wages, and America’s ‘best days being behind it’, rich, high-IQ foreigners can’t get enough of America, buying-up America’s most valuable real estate in the epicenters of intellectualism and wealth creation, Manhattan and Silicon Valley, and inundating America’s most prestigious schools and tech companies with applications.

Related: Why Bay Area/Silicon Valley Real Estate Keeps Going Up

The Virtues of the Sharing Economy

Airbnb and Uber’s sharing economy is one route to dotcommunism

We’re seeing the rise of the ‘sharing economy’ as overpaid, redundant, inefficient 9-5 jobs become a thing of the past, replaced by temp workers, automation, or are simply eliminated, or as I wrote in an earlier article, In Praise of Low Wages:

The boom of the freelancer economy, temp economy, and service sector is part of a growing trend where people are being paid for the value they truly create, instead of the inflated wages of the pre-2008 economy. This helps restore the equilibrium between labor and capital, which until recently was too skewed in favor of labor. Lower wages translates into lower prices and a higher standard of living. The growth of temp work has far exceeded total payrolls:

Until recently, you had a job glut of too many people being overpaid, and the 2008 financial problem changed that, putting much more emphasis on productivity, profits and efficiency, which is great for stock prices but not so great, I suppose, for lower-skill workers. This ties into the reputation economy that allows little allowance for errors, and perfection is necessary or else you will get bad reviews and your freelance career will be over. This means better service and accountability, since unlike with a large company where the cost of individual mistakes and incompetence are distributed among the entire firm (occasionally resulting in the company going out of business, as we saw in 2008 with the financial sector), mistakes in the freelancer economy affect only the individual.

Some on the left call this ‘digital serfdom’, but if the people doing this work feel exploited they always have the option to quit and try to get a job at McDonald’s, for example, along with the 2 million others also applying. Good luck with that. Even if the jobs are tedious, have no benefits, and don’t pay that well, these web 2.0 companies provide income opportunities for people who may not have the cognitive capacity to pursue higher paying skills. The left wants jobs, but only if these jobs conform to their exacting, impossibly-high standards, rendering such jobs unprofitable for the employers, and then the left whines about weak job creation as if it’s not their fault, blaming their favorite targets: Republicans and rich white males.

Greece … Much Ado About Nothing

Funny tweet by Josh Brown, The Reformed Broker:

Liberal website vox.com is fanning the flames of crisis for clicks and ad dollars:

Larry Summers wrote the scariest op-ed you’ll read this month

Haven’t we seen this movie a thousand times already? Unless you read 1000′s of op-eds in a month, that doesn’t sound too scary. Hasn’t Greece been ‘on the brink’ since 2010? Yaaawn wake me up when heads roll…or something interesting like that.

Greece, like Crimea in 2014, is just an other dip buying opportunity. Greece’s economy is no bigger than that of Rhode Island; economically speaking, Greece is a drop in the bucket. In 2011, during the depths of the European debt problem, I told people to ignore the doom and gloom and to buy the dips, and the S&P 500 has surged nearly 75% since then. People like myself are the ones who keep being right, despite our lack of media credentials. Doom & gloom sells, not sanity. The people who are right get the least attention.

Related:

Ignore the Doom and Gloom Narratives
Ignore the Doom and Gloom Media