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General Thinking

Language of Marketing

I have been contributing some of my writing to a project called the Carbon Almanac which was conceived by Seth Godin. Gave me an opportunity to quiz him on things.

He has written a total of 21 books. Last week, I asked him if any of his books had failed and he told me one of his books had succeeded only in Germany! Boo-fucking-hoo.

Got me thinking about how successful he has been. All he does is write about marketing and how to leverage marketing. Although, he has published a few rants on ‘how broken education is’; most of his work is in the area of marketing. 

Marketing is about spreading ideas. He has been able to spread ideas using his books. 

How many great marketing thinkers do we know who do not speak English?

How many thinkers, who do not know English, would have great ideas?

How much voice would a Brazilian Seth Godin, who knew only Portuguese, have had?

I do not know any great German or French marketing thinker. But at the same time, only Louis Vuitton can sell $50 bags made in Bangladesh for $50,000. Only SAP can sell enterprises atrocious software for the price at which it does. It is so bad that it takes months to implement. 

There seems to be a reason that most of the marketing thought seems to emerge from the USA. 

English.

If only the South Americans had allowed the ‘right’ people to loot them. They would have been so much more prosperous.

What if Seth had been German? Would he be as successful?

Also, what is the marketing sauce that Louis Vuitton uses? What marketing dark arts are we missing out on? Would we ever find out; locked up in our Anglophilic world?

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Learning by Proxy

Inflation | Learning by Proxy

Price discovery in any market takes place when demand meets supply.

Over the last couple of years, it has been very difficult for demand to meet supply simply because of the number of disruptions that have taken place in the supply chain. This has further been exacerbated by the fact that people have been hoarding things because of the uncertainty surrounding availability, access, etc. 

When demand exceeds supply prices go up. This rise in price is called inflation.

Capitalism seeks growth. Growth can only arrive when demand rises. When the growth in demand is not met by commensurate growth in supply, inflation is the result. 

The government use fiscal and monetary policies to control inflation. If demand is more than supply; either make it difficult for consumers to borrow (increase interest rates) or make it easier for producers to expand supply (stimulus, subsidies, etc). 

Since the Second World War, a cornerstone thesis of policymakers across the globe has been to keep inflation low.

Why?

Deflation, which is the opposite of inflation often results in revenues shrinking even if demand exists. Lesser revenue would lead to layoffs and therefore further decrease in demand. So nobody wins. 

If inflation is high, goods and services become more and more expensive over time. People will spend only on things that are absolutely essential and even that, sparingly. Consumption drops. The other way in which this scenario plays out – employers are forced to increase the salary of employees. That lowers margins. 

Let me illustrate this with some data from the US.

Source: Official Data

This is US Dollar Inflation since 1635. Throughout history, It was normal to have deflationary years. Prices went up and then markets collapsed and prices went down. That is all fine, till you reach 1948. After the Second World War, there was a focus on reigning in Inflation. Leaving out the fiasco caused by the Oil Embargo in the 1970s, inflation has been quite sedate. 

Source: Official Data

At the same time, what we also notice is that buying power has collapsed since the Second World War. The absence of deflationary years ensured that prices kept going up. This resulted in more money being required to buy the same goods. For most of American history, $1000 dollars from 1800 could have bought $1000 dollars worth. In other words, the buying power of $1000 remained strong.

In the last 50 years, you would need 10s of thousands of dollars to buy what $1000 dollars could have bought in 1800.

Source: Official Data

Another way of showing the collapse of buying power.

In this context let us look at the rising inflation that is being witnessed in 2022. 

For more than 2 decades now, the US has had an inflation rate of 1% to 3.5%. If you buy an item for $10, a year later it is likely going to cost you $10.1 – $10.35. Nobody would even notice this. Worse, at a one per cent inflation over a prolonged period of time, while prices might move from $10 to $12/$13, it happens so gradually that nobody would realise the changes taking place. The sudden doubling of inflation makes the changes in pricing obvious. 

For companies that need to compensate their workers, when inflation is at 1% giving them a 3% hike and letting them know that they are going to comfortably beat inflation is easy. The more blue-collar your work, the truer this is.

As inflation hits 7%, claiming to be providing a hike 3 times the inflation becomes far more difficult. A worker who is paid $30,000 per year is offered a 3% increment or $900 more the next year. The minimum wage stagnated at the same level for decades. 

This is the advantage of a low inflation environment. The top managers and executives in the company are able to give themselves 20%  to 50% in salary hikes without causing too much hurt (they are fewer in number) to the shareholders while giving little to nothing to the people who make the wheels go around.

The chasm between what the country’s corporate leaders and their workers earn is widening to Grand Canyon-like proportions, according to new research that shows CEO compensation surged 940% between 1978 to 2018 while the average worker saw a meagre 12% pay hike over the same 40-year period.

Source: CBS News 

Simply divide 940% by 40, you get a respectable 23.5%. Through multiple recessions, stock market collapses, etc. CEOs have managed to pay themselves more! In that same period, the average worker saw their salary increase 12% or 0.3% per annum.

Then comes a term popularised by Alfred Rapport in 1986 – Shareholder Value. The thesis is that the sole purpose of the company was to maximise shareholder value. Not stakeholders but only shareholders. And managers who maximise shareholder value (read CEO) are rewarded with money. Often this maximisation happened at the expense of all own the other stakeholders. The environment suffered; employees (esp Blue Collar) were paid incredibly poorly, and sweatshops were invented.

Source: Times Now

Source: Livemint

Source: BBC

Source: Investopedia

The issue at hand is not inflation. It is the possibility that corporations would have to dish out unprecedented salary hikes to retain employees. The pressure on Biden is not from the consumer, it is from corporate leaders.

The unfortunate truth is, we will see the other side of this inflationary peak much sooner unless COVID has a say in it. COVID has battered the world and its economies and still, Apple managed to sell more iPhones in 2020 and 2021 than ever before. This is because of the liquidity that the stimulus has introduced into the market.

That tap will be closed. Demand will fall.

Inflation will climb down in less than 2 quarters. The leaders will project this as incredible economic shepherding. It will be hailed a victory. The corporates will continue to dish out measly single-digit salary hikes.

The rich can continue to get richer and the poor can continue to get poorer.

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Learning by Proxy

Real Philanthropy | Learning by Proxy

Earlier this year I had written a piece on Philanthropy where I had mentioned how the wealthy have been using foundations as a vehicle for tax evasion. In fact, under the guise of charitable foundations, these billionaires are using these are vehicles to influence policy across the world to get preferential treatment and make themselves even more wealthy.

As the year draws to a close and a new one dawns I want to write about the good things that are happening in philanthropy. Of all the Billionaires out there, one seems to be taking ‘giving away’ seriously and doing a good job of it.

Mackenzie Scott.

For those of you who do not know, she is the former wife of Amazon founder, Jeff Bezos.

Scott has not only begun to make good on her word, but she’s doing so at a record pace and with total control over where her money goes: In a little more than two years, Scott, who is worth $57 billion, has given $8.6 billion to 780 organizations promoting issues including gender equity, racial justice, public health and beyond. She has done so without an office or even a mailing address, and with scant evidence of a full-time staff. Instead she works with her husband Dan, researchers and advisers from nonprofit consulting firm Bridgespan. She answers to no one, has no board of directors (that we know of) and, because she’s not making gifts through a charitable foundation, no reporting requirements, either. (In comparison, the Gates Foundation, which has nearly 1,800 employees, made $5.8 billion in grants in 2020. Scott distributed slightly more than $5.8 billion that year.)

And, crucially, she employs a “no-strings attached” giving philosophy, meaning each organization can use the funds however they see fit. “It empowers receivers by making them feel valued and by unlocking their best solutions,” Scott wrote on Medium in June.

Source: Forbes

Just for perspective; Bill and Melinda Gates Foundation has 1763 employees across 9 offices. Giving money away should not require that many people. You just need one person to sign the cheques is it not?

There are others who are also stepping up to put more money where it is really needed. One of the crusaders comes from the unlikeliest of places. Robert Downey Jr, better known for his role as Iron Man is bringing a group of philanthropists together to provide fast grants to scientists who are working on challenging problems.

If we really want to get the planet to net zero emissions, we need to transform how we produce and consume electricity. We need newer, more-efficient transportation, and a food supply that doesn’t rely on deforestation. We need climate-friendly agriculture and better ways to preserve ecosystems. We must capture and remove existing greenhouse gases. We need constant iteration for efficiency. For all the above we need the best minds working on the right problems, and quickly.

Unfortunately, if there’s one major shortcoming of our existing scientific institutions, it’s speed. In the earliest days of the pandemic, as researchers raced to understand COVID-19 and test ideas for response, a group of outsider philanthropists stepped up to create Fast Grants for quick-turnaround financial resources for new questions and ideas. The program did more than just fund projects, it showed that there was a more effective, less bureaucratic way to support scientists.

[…]

Funding risky research first requires bets on risky new models. To help stop the leaks on the scientific talent funnel, our team is launching a new program: the FootPrint Coalition Science Engine.

We are in the business of supporting entrepreneurial scientists and we are in agreement that the major impediments are the obvious limitations of decision-making by committee. We’re trying something different. FootPrint Coalition is funding early research in brand new environmental fields, and doing it under the direction of esteemed Science Leads who can move quickly and fund at their discretion. The FootPrint Coalition Science Engine builds off suggestions made in the Funding Risky Research paper. It operationalizes the “loose-play funding for early-stage risky explorations” but doesn’t bind it to universities.

We’re doing it “in public” on the Experiment funding platform, a website for crowdfunding science research projects, so anyone can participate as a cofunder.

Source: Fast Company

In the meantime, Laurene Powell Jobs is taking a slightly different track to do her giving. She created the Emerson Collective, but unlike other Billionaires who hide under the guise of a foundation, she has incorporated it as an LLC. She is using the money to invest in causes that she believes in and supporting entrepreneurs others may not necessarily.

The collective, as The Post describes it, is “equal parts think tank, foundation, venture capital fund, media baron, arts patron and activist hive.” The collective invests in private companies not because the goal is to make money but because, she says, Silicon Valley has demonstrated that “amazing entrepreneurs who … are 100 percent aligned with our mission” can help find solutions that might elude a nonprofit.

Because Emerson is formed as a limited liability company rather than a foundation, it has the flexibility to do more than make grants to nonprofit groups. It can support advocacy groups, launch its own activist campaigns and contribute to political organizations.

[…]

“What’s fascinating is that by listening to all these founders, she has basically put founders at the head of each of the sectors of Emerson Collective, so that she’s really funding entrepreneurs inside the collective who want to disrupt their spaces,” Conway told The Post. “She wants people to innovate in their sector — education reform, getting the Dream Act passed. So Emerson has become like an accelerator for causes around social change.”

Source: CNET

But with this new crop of philanthropists, one sentiment seems to be clear, they are not going to be taking their wealth to their graves. Whether it is Laurene Powell Jobs…

“I inherited my wealth from my husband, who didn’t care about the accumulation of wealth,” she told the New York Times. “I’m not interested in legacy wealth buildings, and my children know that. If I live long enough, it ends with me.”

The sentiment, which she doesn’t appear to have expressed before, syncs with a building consensus among some of tech’s wealthiest people: That the rich should give away their money today, rather than later, and that the heirs of long-dead billionaires shouldn’t have so much power in society centuries later.

Source: Vox

Or MacKenzie Scott

“My hope is that MacKenzie’s style of giving inspires the philanthropic sector, and inspires other donors to give in a way that supports bold, big visions,” says Favianna Rodriguez, who works to aid communities of color in Oakland, California. “We don’t have a lot of time. We’re looking at the crisis of the epidemic, the economic crisis, the climate crisis, and this moment of racial reckoning.”

With $57 billion still to give away, Scott has big plans to continue to affect real change and have a lasting impact on the historically underfunded and overlooked. As she puts it: “Generosity is generative. Sharing makes more.”

Source: Forbes

So in the end, it seems like it really is possible to give away a lot of money. As the old adage goes; if there is a will, there is a way.

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Learning by Proxy

Internet | Learning by Proxy

All of us use the internet. The mere fact that you are reading these words is because of the internet. Today, your phone has software, your car has software, your refrigerator has software, even my weighing scale has a software. Software is everywhere. Have you ever wondered what software the internet runs on?

The internet was originally created as a project to communicate with soldiers on the battlefield. As the war with Russia (the hot one, not the cold one) never came to pass, that same technology found other applications. People started experimenting and building on it. The fundamental was to build a system through which data could flow. A protocol. While there were many competing protocols, the one that was free eventually won out. It is called the HyperText Transfer Protocol (HTTP).

HTTP is like the pipes that regulate the flow of data on the internet. That data needs to be stored somewhere. Servers store those data. Webservers are software that helps a server handle HTTP requests.

Open-source software (OSS) is computer software that is released under a license in which the copyright holder grants users the rights to use, study, change, and distribute the software and its source code to anyone and for any purpose. Open-source software may be developed in a collaborative public manner. Open-source software is a prominent example of open collaboration, meaning any capable user is able to participate online in development, making the number of possible contributors indefinite. The ability to examine the code facilitates public trust in the software.

Source: Wikipedia

Open-source software allows anyone to alter the source code and create a newer, better version, or add features and share it. Often many people simultaneously work on open source software and share their development with the rest of the developer community working on it. This makes the software better for everyone. Keeping it open source also makes it free to use.

While there were several competing server technologies including the likes of Microsoft and Oracle; most of the tinkerers who went on to build almost everything you use on the internet used Open Source Software for their servers because it is free. I can get a WordPress server with software setup for $5 today. That is the startup cost on the internet.

The Apache HTTP Server was one of the most popular open-source server software released in 1995. It is Open source (explained above), cross-platform (works on various hardware), web-server software. WordPress powers about 30% of all websites on the internet, it runs on Apache.

In the spirit of Open Source Software, a developer by the name of Ceki Gülcü created a Java-based logging utility called Apache Log4j. Log files store what is happening within certain systems so that if an error occurs it is possible to figure out what went wrong.

When a utility is useful many people adopt it. It comes down to the person who wrote it, to maintain it. Often there are several bugs that get discovered over time and they need to be fixed as they get discovered.

Dependency

Source: XKCD

Log4J was written in 2001 and that developer has been maintaining it since – free of cost. But, last week a zero-day vulnerability was discovered which allows arbitrary code execution.

zero-day (also known as 0-day) is a computer-software vulnerability either unknown to those who should be interested in its mitigation (including the vendor of the target software) or known and a patch has not been developed. Until the vulnerability is mitigated, hackers can exploit it to adversely affect programs, data, additional computers or a network.

Source: Wikipedia

Think of it as a birth defect that you just realised exists.

Arbitrary code execution allows the attacker to run any code that they wish on the machine.

Last week it was discovered…

The vulnerability in Log4J is extremely easy to exploit. After sending a malicious string of characters to a vulnerable machine, hackers can execute any code they want. Some of the earliest attacks were kids pasting the malicious code in Minecraft servers. Hackers, including some linked to China and Iran, are now seeking to exploit the vulnerability in any machine they can find that’s running the flawed code.

And there’s no clear end in sight. The Log4J issue amounts to a long-term security crisis expected to last months or years. Jen Easterly, director of the US Cybersecurity and Infrastructure Security Agency, has said this is “one of the most serious flaws” she’s ever seen.

Source: MIT Technology Review

The problem is that almost half the Internet is built using this and that means almost everything that we use is right now vulnerable at some level. The first problem is that there is no clear idea of the fix and they are working on it and besides who funds it?

“The team is working around the clock,” Yazici told me by email when I first reached out to him. “And my 6 a.m. to 4 a.m. (no, there is no typo in time) shift has just ended.”

In the middle of his long days, Yazici took time to point a finger at critics, tweeting that “Log4j maintainers have been working sleeplessly on mitigation measures; fixes, docs, CVE, replies to inquiries, etc. Yet nothing is stopping people to bash us, for work we aren’t paid for, for a feature we all dislike yet needed to keep due to backward compatibility concerns.”

[…]

As pressure and critics pile on the Log4J team, old questions of fairness are being asked about the open-source world.

“Fairness is a problem,” says Ceki Gülcü, who founded Log4 . “There’s this weird imbalance, where you profit from something but you don’t give anything back.”

The public is also almost completely ignorant of the immense role—and risk—of the free-labor-powered open-source software that runs the internet. OpenSSL powers encryption, for example, and Linux is behind the most widely used operating systems on the planet, including Android.

[…]

In 2018, the developer behind a popular open-source project called ua-parser-js quit, unwilling to work for free anymore. The software is used by big tech firms including Google, Amazon, and Facebook. The person who took control of ua-parser-js then hijacked the software and added malicious code to the project to steal cryptocurrency.

Source: MIT Technology Review

The greatest problem is that a lot of the infrastructure that we take for granted is built out of passion and love for software. Entrepreneurs who profess ‘passion’ don’t really build much of use. Even if they do, they use an elitist tool called Patents to put a lock on it. This stops it from being of any benefit beyond the same company. At the same time, they all continue to use all of the open-source solutions and build their wealth on them.

Wait there is more…

So far, the vanguard of Log4j hacking has primarily comprised cryptominers, malware that leeches resources off of an affected system to mine cryptocurrency. (These were extremely popular a few years ago, before everyone realized that the real money’s in ransomware.) Some nation-state spies have dabbled as well, according to recent reports from Microsoft and others. What’s seemingly missing is the extortion, the ransomware, the disruptive attacks that have defined so much of the past two years or so. This won’t be the case for long.

[…]

Log4Shell is also relatively trivial to exploit. Just send a malicious piece of code and wait for it to get logged. Once that happens, congratulations; you can now remotely run whatever code you want on the affected server.

It’s that combination of severity, simplicity, and pervasiveness that has the security community rattled. “It is by far the single biggest, most critical vulnerability ever,” says Amit Yoran, CEO of cybersecurity firm Tenable and founding director of US-CERT, the organization responsible for coordinating public-private response to digital threats.

So far, though, that calamity seems slow to manifest. Hackers are absolutely targeting Log4j; security firm Check Point has seen over 1.8 million attempts to exploit the vulnerability since Friday, according to spokesperson Ekram Ahmed. At some points, they’ve seen over 100 attempts per minute. And state-sponsored groups from China and Iran have been spotted using Log4Shell to establish footholds in various targets. Still, for now, cryptominers reign.

Source: WIRED

The foundation of what the internet stands on is being taken care of by soldiers who are often unpaid. Now, just imagine, not having the internet for 1 month or losing everything that you have stored on the internet. What would you pay to avoid that? Those who have profited off the internet should certainly start paying.

Categories
General Thinking

Economics

Economics is a social science that studies the production, distribution and consumption of goods and services.

A huge portion of the foundation of what we call economics today was laid down by the British of the 18th and 19th centuries.

Yes, the very same people who went plundering half the world. The very same people who caused starvation elsewhere so that they could keep shareholder returns coming. The very same people who invented the Opium trade. One can argue that they were not the nicest people to populate the land.

The global financial and economic system today is based on the thoughts of these people. It is no wonder that one of the fundamental assumptions of economics is that man is selfish and you need to appeal to that selfishness in order to get anything done. This is how we arrive at the temple of shareholder value. 

Everything bad in this world – Poverty, hunger, exploitation, climate change – is a result of that economics and its relentless drive

Just imagine if Economics was a study that emerged out of Japan!

If you expect the worst out of people, that is what you will get. Economics expects it and it gets it.

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Learning by Proxy

Indian Crypto Policy | Learning by Proxy

In most countries there exist laws that forbid monopolies. But there are things that government likes to monopolise. One of the things that it loves to monopolise is the issue of currency.

A currency is a store of value, that is provided legitimacy by an authority. In most cases the government.

Cryptocurrency is a decentralised currency that has no issuing authority, nor does it have an underlying basis for its value. Nobody is ascribing it value except for what the market assumes.

Most importantly, they are cutting in on the government’s monopoly.

Gold was used as currency for a very long time. In fact, when paper-based currencies were first introduced, they were promised to provide an equivalent amount in gold. Then America decided to go fiat. A fiat currency does not have any underlying basis, its value is solely derived from the issuer. Almost every economy followed suit.

Gold has all of the properties of a currency but you would never find anyone tossing a 10 gm gold biscuit across the counter to buy a laptop. Gold instead is treated as an asset to invest in.

The boiling frog is an apologue describing a frog being slowly boiled alive. The premise is that if a frog is put suddenly into boiling water, it will jump out, but if the frog is put in tepid water which is then brought to a boil slowly, it will not perceive the danger and will be cooked to death. The story is often used as a metaphor for the inability or unwillingness of people to react to or be aware of sinister threats that arise gradually rather than suddenly.

Source: Wikipedia

Most governments did not even take notice of cryptocurrencies when they came into circulation more than a decade ago. It was too technical, hard to understand and even harder to own. But just like the proverbial boiling frog, the governments are suddenly faced with an animal that they know not how to tame.

The government has two policy levers using which it controls the economy.

The Fiscal Policy refers to the use of government spending as well as tax policies to influence economic conditions. Direct investment towards certain sectors and subsidise certain areas to encourage adoption/investment.

The other is the monetary policy which the government does not directly control. It is set by the central bank by controlling the issue and circulation of money as well as the interest rates prevalent in the banking system.

Cryptocurrency upends both.

If transactions are to be undertaken with cryptocurrency, the government no longer has visibility of the transactions because crypto is blessed with anonymity. This really disrupts tax policy.

The central bank has no means to stimulate or dampen demand when transactions are taking place outside of the banking system and interest rates are market-determined and not policy determined.

Cryptocurrency, therefore, is a nightmare for most governments. Further, banning it outright is only going to result in rampant black markets emerging and it would become impossible to control and to know.

Cryptocurrency has become like an unwanted relative living at home. Can’t get rid of them but neither do you want to keep them.

With that let me welcome you to the flip-flop regulation of the Indian crypto market.

The parliamentary panel yesterday (Nov. 15) met representatives of crypto exchanges, Blockchain and Crypto Assets Council (BACC), among others, for a deeper understanding of the issues involved and the business. This was the first such meeting.

While they agreed that a regulatory mechanism was necessary, none of the stakeholders could decide who must take the onus of regulating the swelling cryptocurrency ecosystem in India.

[…]

The law was earlier intended to “prohibit all private cryptocurrencies in India.” But certain exceptions will be permitted to promote the underlying technology of cryptocurrency—and its uses—according to the Lok Sabha bulletin (pdf) released in January.

Meanwhile, the burgeoning popularity of virtual tokens in India has caught the fancy of urban Indians, as well as millennials in tier-2 and -3 cities. At yesterday’s meeting, experts said cryptocurrencies were some “sort of investors’ democracy.”

Source: Quartz

The government is unsure. It does not even want to call cryptocurrency, currency. Calling it currency gives it an aura of legitimacy and therefore would cut in on the monetary policy side. So the government wants to refer to it as a crypto asset. Akin to gold, something you invest in and not use for transacting. Further, taxing and regulating assets or securities trade is a normal activity that the government does.

The question that arises is who will regulate and how will it be taxed?

There have been proposals to have SEBI handle the trading of crypto ‘assets’. But then SEBI deals with securities such as shares, and crypto is nothing like shares. Then should RBI do it?

Every day there is a new leak and every other day it is countered.

There is one thing that is happening for certain – policy paralysis.

Prime Minister Narendra Modi will take a final decision on the regulatory framework for cryptocurrencies amid conflicting views among stakeholders, two persons familiar with the development said. A high-level meeting was held on Thursday to consider all the options as also stakeholder views including the concerns voiced by the Reserve Bank of India.

The options include a complete ban on private cryptocurrencies, a partial ban, allowing all categories of crypto products with regulation, or just a select few with regulation, one of the persons said.

Source: Economic Times

How could you have a policy on the table and everything from a complete ban to regulated usage still be in consideration? There seems to be no direction whatsoever.

In the meantime, well-funded crypto startups are running ads all over television and newspaper to grow as fast as possible. They all seem to be prescribing to the thinking – once you become too big to fail, they will be forced to regulate you.

Source: Twitter

Source: Twitter

Let us see how long the indecision lasts at the centre.

Categories
General Thinking

Man’s Seach for Meaning

This is a book by Viktor E Frank, who is a psychologist from Vienna. He gets caught by the Nazis and sent to the concentration camps. He describes in detail his experiences at the camp. As a psychologist, he got to watch the way in which the thinking of people around him changed as they spent an indeterminate time at the camp. He shares a large number of stories of incidents that took place at the camp and how they helped him arrive at insights about suffering and hope. I am sharing some of the key ones that struck me from the book.

Happiness cannot be pursued but has to ensue. Much the same way that success cannot be pursued, it must ensue. Those who spend a lot of time pursuing happiness end up unhappy because it keeps eluding them. 

You cannot control your circumstances. But whether you are free or not you always have control over your attitude. Even a person at a concentration camp can have a good attitude or a bad attitude about what was happening.

What you have experienced no force on the planet can take from you. What he learnt about psychology and what eventually made him successful were born out of the experiences that he endured at the concentration camp. 

It is not about what you expect from life but what life expects from you. We all feel down and desperate when we feel that life is not delivering what we expect from it. But often, those are the moments when life expects something from you. To overcome that challenge so you could share it with someone in the future. There is a purpose to what you are going through, the challenge is to find the purpose.

He describes a patient, who comes to him and tells him about the grief he feels on the passing of his wife. 

Viktor: What would have happened to your wife if you had passed instead of her?

Patient: I am sure she would have felt a lot of grief and suffered.

Viktor: In that case, are you not saving her from that suffering by having survived her.

Suffering is not a problem, but suffering needs to have meaning. Suffering for suffering’s sake is masochism. But suffering when done for a purpose is valuable. 

Mental health is about the tension between what man has achieved and what man ought to achieve or the remaining purpose. People who feel that they have achieved all that they have to and do not have much to look forward to. They end up having mental breakdowns because they do not see any more purpose in their life. Their life merely turns into existence. 

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Learning by Proxy

Joining Atoms | Learning by Proxy

In 1919 a New Zealander conducting research in Manchester was playing around with the Nitrogen Atom, his name was Ernest Rutherford. Over the next 10 years, there was much that was learned about the structure of the atom. While Rutherford, Einstein and Bohr did not arrive at a solution to the problem of unlocking the power of an Atom; it was Enrico Fermi who figured it involved bombarding heavier elements.

It was actually two German scientists, Otto Hahn and Fritz Strassman, living in Nazi Germany working at the University of Berlin, collaborating with a Jewish refugee Lise Meitner, who had escaped to Sweden, that showed that Nuclear Fission was possible by bombarding Uranium. Despite the Second World War, the scientific publications were working rather well and the news of the experiments got around to the US.

Robert Oppenheimer was hired to build an uncontrolled nuclear fission chain reaction device. No sooner was it built, America dropped it on Japan.

Nuclear Fission uses heavy atoms such as Uranium because they are unstable. These atoms are bombarded by a neutron which affects their stability and causes them to undergo decay into lighter but more stable atoms (relatively) along with the release of a lot of energy and three more neutrons. Those neutrons can trigger more reactions and that is what makes the chain reaction possible.

In the meantime, there was another kind of nuclear reaction that involved combining light atoms such as Hydrogen which was being studied in 1920. When two Hydrogen atoms are subjected to a lot of energy (heat), they fuse together to produce a heavier atom, Helium. This is also accompanied by a tremendous release of energy. It was known for a long time that stars produce their energy through Fusion. It was not until 1950, with the consistent input of several scientists building on Ernest Rutherford’s experiment that the principle and the execution of Nuclear Fusion were understood.

Fission is inherently a chain reaction. You just need to control the chain reaction with the removal of the extra neutrons that are being generated. This is usually done by inserting rods made of lead or carbon that absorb the extra neutron. But the by-product in the case of Fission is even more radioactive and needs to be disposed of safely. Not to mention, the fuel, Uranium is hard to find, very rare and hard to handle.

The accidents at Chernobyl, Three Mile Island and Fukushima have shown that the cost of losing control of a Nuclear Fission plant can be catastrophic. At Chernobyl, the control rods were pushed in a little late, this kept the reactor from turning into a bomb but caused the container to rupture which has left the entire area radioactive even today.

In the case of Fusion, the reaction is harder to start and sustain. The by-product apart from Energy is relatively safer. Also, the input, Heavy Hydrogen is quite easily available in our seas. As one scientist put it, a reaction that powers the sun sounds really dangerous but it is easier to put out than a match.

I pushed a black button. A purring noise began. “That’s the sound of the vacuum draining the air from the glass tube,” Mumgaard said. He turned a valve, releasing a tiny bit of hydrogen gas into the tube. A hot-pink glowing light appeared, nested within the glass tube like a matryoshka doll. The magnetic field that contained the pink plasma was visible in the form of empty space between the glass and the glow. “That pink is the superheated plasma,” Mumgaard said. “It’s at least a thousand degrees. But touch the glass.” The glass was cool. “Now touch the copper wires.” They were warm, but not hot. The warmth of the copper wires was not on account of their proximity to the superheated plasma but, rather, because copper is not a perfect conductor; some of the energy running through it is lost in the form of heat. Superconductors lose almost no heat—which is energy.

It seemed impossible that the pink plasma inside the tube, which was as hot as lightning, wasn’t in some way dangerous. Couldn’t some of it leak out of the magnetic bottle, with catastrophic consequences? As an answer, Mumgaard twisted a valve to let a tiny bit of air into the glass tube; the plasma vanished. “People think of fusion like they think of fission, as this overwhelming reaction, but, really, it’s such a delicate process,” Whyte said. “It’s like a candle in the wind. Anything can blow it out. Even a single human breath.”

Source: New Yorker Magazine

Nuclear Fusion is considered the holy grail of energy research. If we could create our own small sun that can power our energy requirements, would that not be just amazing.


So why have we not done it?

For starters, the reaction required, need us to produce temperatures in excess of 150 million degrees. Don’t need to bother with the units, just know that it is insanely hot. This has been created thus far using lasers which heat up air into plasma.

The second issue is ensuring that it can keep the reaction going in containment. Unlike the Fission reaction where the risk is of turning the reaction into a bomb, here the challenge often is that the reaction will fizzle out and stop if not enough heat is being produced. The Sun is a huge magnetic bottle. That magnetism contains the reaction within it. Makes it possible for the temperature and the reactions to sustain and perpetuate.

To solve the issue of containment, most devices use powerful magnetic fields to suspend the plasma in midair to prevent the scorching temperatures from melting the reactor walls. Looking something like a giant doughnut, these “magnetic containment devices” house a ring of plasma bound by magnetism where fusion will begin to occur if a high enough temperature is achieved. Russian physicists first proposed the design in the 1950s, although it would be decades before they actually achieved fusion with them.

Source: Discover Magazine

Also money. This kind of work requires a lot of iteration and therefore a lot of money. Can you imagine the power bill you will run up trying to create a plasma heated to 150 million degrees?

Creating a magnetic field or magnets that can hold the fusion in containment where it can continue to perpetuate has been the biggest challenge that has plagued scientists though.

In 1976, the U.S. Energy Research and Development Administration published a study predicting how quickly nuclear fusion could become a reality, depending on how much money was invested in the field. For around 9 billion a year in today’s dollars—described as the “Maximum Effective Effort”—it projected reaching fusion energy by 1990. The scale descended to about a billion dollars a year, which the study projected would lead to “Fusion Never.” “And that’s about what’s been spent,” the British physicist Steven Cowley told me. “Pretty close to the maximum amount you could spend in order to never get there.”

[…]

Estimates of the cost of the Manhattan Project, which produced atomic weapons in four years, vary, but it is commonly said that the scientists were given a “blank check.” This year, the U.S. government will spend some 670 million dollars on nuclear fusion. That’s a lot of money, but 650 billion—the amount the I.M.F. estimates that U.S. taxpayers spent on fossil-fuel subsidies last year—is quite a bit more.

Source: New Yorker Magazine

Fusion has had a tough time getting the support that it requires.


Now there is a lot of funding chasing it!

Helion Energy, a clean energy company committed to creating a new era of plentiful, zero-carbon electricity from fusion, today announced the close of its $0.5 billion Series E, with an additional $1.7 billion of commitments tied to specific milestones.

The round was led by Sam Altman, CEO of OpenAI and former president of Y Combinator. Existing investors, including co-founder of Facebook Dustin Moskovitz, Peter Thiel’s Mithril Capital and notable sustainable tech investor Capricorn Investment Group also participated in the round. The funding includes commitments of an additional $1.7 billion dollars tied to Helion reaching key performance milestones. Round-leader Altman has been involved in the company as an investor and chairman since 2015.

Source: TechCrunch

Yes! That is Billion, not Million.

Zap Energy, a pioneer in fusion energy technology, today announced that it has raised $27.5 million in Series B funding. The round was led by Addition, with participation from Energy Impact Partners, GA Capital and Fourth Realm, as well as existing investors Chevron Technology Ventures and LowerCarbon Capital. The new financing comes just nine months after closing a $6.5 million Series A funding round, following the achievement of a major scientific milestone in late 2020 that brings Zap Energy closer to energy breakeven.

Source: BusinessWire

The fusion energy field just keeps getting hotter. British Columbia’s General Fusion on Tuesday said that it has raised $130 million in funding to develop its ambitious clean energy technology.

And the announcement teased to the promise of more cash to come, stating that this was merely “the prelude to a large financing round being prepared for 2022.” The latest round brings the funding total to approximately $300 million.

Amazon founder and former CEO Jeff Bezos is a longtime backer of General Fusion and his VC arm Bezos Expeditions participated in the round.

Source: GeekWire

And then the largest agricultural landowner in America, who would not allow the scientists in Cambridge to release the formulation for the COVID vaccine because his philanthropy ‘incubated’ them and whose recent philanthropy to humanity has been the Omicron – Bill Gates – has been investing in the space for a long time through a fund called Breakthrough Energy. He along with the man who ensures that his employees wear adult diapers to work because time is money and has so much money that going to space is the only way he can blow it up – Jeff Bezos – are investing together. This one is definitely going to be a winner.

Sorbom did make it work: He got the job, and 12 years later, Sorbom has his doctorate from MIT and is co-founder and chief scientific officer of Commonwealth Fusion Systems, a rapidly growing company spun out of Sorbom and his co-founders’ research. CFS aims to commercialize fusion, a safe and virtually limitless source of “clean energy,” to combat climate change. The company is funded by the likes of Jeff Bezos and Bill Gates by way of energy innovation investment fund Breakthrough Energy.

Source: CNBC

Fusion Energy seems to be closer than ever.

Fusion scientists often speak of waiting for a “Kitty Hawk moment,” though they argue about what would constitute one. Only in retrospect do we view the Wright brothers’ Flyer as the essential breakthrough in manned flight. Hot-air balloons had already achieved flight, of a kind; gliders were around, too, though they couldn’t take off or land without a catapult or a leap. One of the Wright brothers’ first manned flights lasted less than a minute—was that flight? An A.P. reporter said, of that event, “Fifty-seven seconds, hey? If it had been fifty-seven minutes, then it might have been a news item.”

[…]

In 1901, the chief engineer of the United States Navy wrote, of heavier-than-air flight, “A calm survey of natural phenomenon leads the engineer to pronounce all confident prophecies for future success as wholly unwarranted, if not absurd.” At the time, the Wright brothers were studying aerodynamics in a makeshift wind tunnel; after one particularly disheartening summer at Kitty Hawk, Wilbur confided to Orville his feeling that “not in a thousand years will man fly.” Two years later, they flew their plane for twelve seconds; not too many years after that, they were flying for hours, performing figure eights for large crowds. In response to a report that President Theodore Roosevelt intended to fly with Orville soon, Orville said that, though he wouldn’t turn down a request from the President, he did not think it wise for the President to take such chances.

Source: New Yorker Magazine

It may arrive sooner than most people think!

Categories
Learning by Proxy

Immigration | Learning by Proxy

A bus driver in Sweden is paid on an average of 14500 Swedish Krona; that translates to about USD 1600 a month. A bus driver in India is paid about Rs 15500 a month which translated to about USD 210. The Swedish bus driver would probably jump out of his bus and run in terror if he is asked to drive on Indian roads. He is probably less skilled than the Indian driver who needs to be able to navigate some of the worst traffic, not to mention, children, cows, dogs and most importantly the Indian roads.

Even so, the Swede is paid almost 8 times as much! Why?

Immigration restriction.

Immigration has been at the heart of almost all of the right-wing movements across the western world.


Until about 300 years ago, most countries were not very well defined. Borders and rule were quite malleable and most often it was determined by he who had the greater might. Most places were forts with an agglomeration of buildings around them, whoever occupied the fort ruled the land. Countries changed hands regularly. It is only after the first world war that the contours of stable borders and identities started to emerge even in Europe. The hardening of those borders resulted in the second world war! Then they just decided to let people move about how they pleased and called it the European Union.

For a large part of the 20th century, the population was exploding across the globe. The population of the planet went from a little over 1.6 Billion people in 1900 to close to 8 Billion today.

Source: Our World in Data

There were always more people getting added to the economy, so the economy continued to grow as consumption grew. At the same time, since consumption was growing, more jobs got created and people were needed to fill those jobs. The population of some countries grew faster than others and this ultimately determined the standard of living. In the countries where labour was in short supply, the price of labour was higher – such as in Sweden and vice-versa.

Over the years, as the standard of living increased, the cost of child-rearing also increased. If you take a 3% increase in cost year over year across 50 years since the second world war, what used to cost 100 dollars in 1940, cost USD 438 by 1990.

Salaries have not kept pace with costs and this has resulted in a population implosion in those countries. There are not too many young people available to take up work!

Immigration and Globalisation are two sides of the same coin. The first push back on immigration started in the 1980s and by the Clinton years in the 1990s was already a huge issue in America. For large companies, technology came to their rescue and made outsourcing/offshoring possible. This moved jobs outside of the western economies without the problem of having to deal with immigration.

Outsourcing and increased penetration of both air and shipping routes over the last 30 years moved both knowledge and manufacturing processes out of the western world. China, Vietnam, Bangladesh, Taiwan and others absorbed a lot of the manufacturing from across the globe. While a lot of the knowledge processes were shifted to India and Eastern European countries like Poland, Romania, Czech, Bulgaria, etc.

Even so, there is always work in industries such as hospitality that cannot be outsourced. Many of these jobs were performed by immigrants. Those same immigrants would cover exorbitant fees to ensure that their child got educated and did not end up in the kind of jobs that they did. 2020 disrupted life and many of those who were unable to find work or cover for themselves left the western countries. They went back home.

As the global economy heats up and tries to put the pandemic aside, a battle for the young and able has begun. With fast-track visas and promises of permanent residency, many of the wealthy nations driving the recovery are sending a message to skilled immigrants all over the world: Help wanted. Now.

In Germany, where officials recently warned that the country needs 400,000 new immigrants a year to fill jobs in fields ranging from academia to air-conditioning, a new Immigration Act offers accelerated work visas and six months to visit and find a job.

Canada plans to give residency to 1.2 million new immigrants by 2023. Israel recently finalized a deal to bring health care workers from Nepal. And in Australia, where mines, hospitals and pubs are all short-handed after nearly two years with a closed border, the government intends to roughly double the number of immigrants it allows into the country over the next year.

Source: New York Times

They WANT immigrants suddenly!

The poor reproduction rate in western countries has been laid bare. They just don’t have enough young people. Further, the pandemic forced many of the old people to retire and they may never join the labour force again. This is forcing these countries to re-assess how they evaluate immigrants.

In advanced economies, the immigration measures being deployed include lowering barriers to entry for qualified immigrants, digitizing visas to reduce paperwork, increasing salary requirements to reduce exploitation and wage suppression, and promising a route to permanent status for workers most in demand.

Portugal’s digital nomads can stay as long as they want. Canada, which experienced its fifth consecutive year of declining births in 2020, has eased language requirements for residency and opened up 20,000 slots for health workers who want to become full residents. New Zealand recently announced that it would grant permanent visas, in a one-time offer, to as many as 165,000 temporary visa holders.

One of the sharpest shifts may be in Japan, where a demographic time bomb has left diapers for adults outselling diapers for babies. After offering pathways to residency for aged-care, agriculture and construction workers two years ago, a Japanese official said last week that the government was also looking to let other workers on five-year visas stay indefinitely and bring their families.

Source: New York Times

The issues are severe when it comes to industries like hospitality and healthcare. Many healthcare professionals have quit out of exhaustion that has been wrought by the pandemic. Working 20 hour days, 7 days a week and not being able to meet their families for fear of infecting them has taken a toll on them whether they are doctors or nurses.

The effects of Brexit are getting more and more obvious to the British.

Net immigration to the United KJingdom fell by almost 90 percent last year to its lowest level since 1993 due to the impact of COVID-19 and Brexit, official figures showed on Thursday.

The Office for National Statistics released a first provisional estimate showing that 34,000 more people moved to the UK last year than emigrated, down from 271,000 in 2019.

“Immigration was much lower in 2020 than in previous years, likely caused by a combination of the coronavirus pandemic and Brexit,” the ONS said.

Source: AlJazeera

In the western world, the ‘Immigrant Crisis’ has gone from, too many immigrants trying to enter the country to not enough of them coming in!

While I think, in a matter of another couple of years this situation might be forgotten as things get back to normal. COVID has certainly taken the veil off the lie that immigrants are dependant on rich nations. The truth is that rich nations are very heavily dependant on immigrants to keep their economies running and also to keep themselves rich. Immigrants, irrespective of the kind of work they do are paid far less than citizens. In the US, a family headed by an immigrant would end up earning 33% less than one headed by a US Citizen according to Forbes.

I doubt their need will make this inequity disappear. But if the pandemic situation persists much longer, it may leave these countries starved of immigrants for years to come. Who knows, in the meantime, those very same people might bring about change in their own countries and leave the west behind?

Categories
General Thinking

Mistakes

When you undertake to solve a question in algebra. Once you solve it, you will spend some time checking the steps to make sure that you have not made any mistakes in the solution. Irrespective of how good you are at mathematics, there is always a possibility that you could have made a mistake.

To err is human.

But the very same people, when it comes to their professions would never bother to check the steps that they took to arrive at their conclusion. How many doctors do you think, sit back and analyse if what they are thinking is right or if they have made any mistakes in arriving at their conclusion? How many CEOs go over all the evidence that they have taken into account to arrive at the decision that they have?

We may discuss and offer up evidence, but we rarely double-check ourselves.

Given how often we humans make mistakes, is it right that we are so certain of the decisions that we make?