Monthly Archives: April 2019

Preston McAfee on tech firms doing venture capital

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In this interview, he says,

It’s unsurprising that Silicon Valley’s version of the multidivisional firm is to say we’re going to run a venture capital firm inside.

. . .Venture capital does a great job, and it’s a competitive market. So the idea of trying to replicate venture capital inside the company is usually misguided.

A tech firm may have an upside to funding failed start-ups that a venture capital fund does not have. That is, the tech firm probably can retain the best employees from the start-up.

Cuba and hipsters

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Chris Vazquez writes,

Cuba is a beautiful place filled with amazingly incredible people, my people. But these people deserve so much more. Cuba was the pearl of the Antilles, the preferred island for the Spanish, and the envy of Latin America. Havana was beautiful the way San Francisco and Barcelona are today, not the way ancient Aztec temples or Egyptian pyramids are; but what was once the vibrant home of my abuelos and their contemporaries is now a pretty, boho chic relic for American visitors.

I have friends on the left who eagerly visited Cuba and came back saying how wonderful it is. Socialism is that hip.

Downward mobility?

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Joel Kotkin writes,

by 2016, home ownership among older millennials (25-34) had dropped by 18 percent from 45.4 percent in 2000 to 37 percent in 2016.

That is in the U.S., but he goes on to cite similar data for Australia.

So why has home ownership fallen? Largely due to regulations that have placed new affordable housing beyond the reach of younger Australians, something we also see in major cities in Great Britain, the United States, and Canada. In all these places, the main culprit has been “smart growth,” a notion that encourages the reluctant to move closer to dense urban cores and give up the dream of owning a home.

. . .In Sydney, planning regulations, according to a recent Reserve Bank study, now add 55 percent to the price of a home. In Perth, Melbourne, and Brisbane the impact is also well over $100,000 per house.

Another dispatch from the IDW

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Alex Mackiel writes,

a recent study published in Developmental Cognitive Neuroscience found evidence for sex differences in brain functional connectivity in utero and therefore presumably before socialization could possibly have been at play

Later in the essay:

I believe that most of the resistance to evolutionary psychology both then and now stems from two fallacies: (1) that the nasty aspects of our human nature, such as tendencies for violence, are natural and therefore, good. This is known as the naturalistic fallacy; and (2) that an evolved human nature necessarily implies genetic determinism and inflexibility

The naturalistic fallacy is that what is natural is good. What I might call the converse of the naturalistic fallacy is that what is good must be natural. So if it is good to be nonviolent, it must be natural to be nonviolent. I think that this converse of the naturalistic fallacy is what underlies some of the opposition to evolutionary psychology.

Everyone agrees that human behavior reflects both natural instincts and social constraints, with the latter coming from traditional norms and institutions. One might say that the inclination on the left is to see the natural instincts as good and the social constraints as causing problems. And the inclination on the right is to see the natural instincts as causing problems and the social constraints as good.

Later in the essay:

It is my contention that sociocultural factors that have been proposed in place of evolutionary factors as causal influences on mind and behavior have been overstated, while the importance of evolutionary factors have been understated.

That correlates with the predominance of the ideological left in academia.

Mackiel’s essay refers to a paper by David M. Buss and William von Hippel. The authors write

We conclude with the irony that our evolved psychology may interfere with the scientific understanding of our evolved psychology.

A dispatch from the IDW

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Larry Cahill writes,

Imagine your response to picking up a copy of the leading scientific journal Nature and reading the headline: “The myth that evolution applies to humans.” Anyone even vaguely familiar with the advances in neuroscience over the past 15–20 years regarding sex influences on brain function might have a similar response to a recent headline in Nature: “Neurosexism: the myth that men and women have different brains” subtitled “the hunt for male and female distinctions inside the skull is a lesson in bad research practice.”

It’s like seeing Democracy in Chains put up for a prestigious award.

I want to give a big plug to Quillette. It is now the must trustworthy brand in journalism.

Peter Zeihan on Venezuela

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He writes,

This isn’t socialism, or even mismanagement—this is kleptocracy. (Yes yes yes there’s an argument to be made that most socialism-flavored governments concentrate so much decision-making into government hands that such cronyism is a constant danger, but that’s a debate for another time.) Suffice to say, since roughly the middle of the Chavez era in the late 2000s, the only thing socialist about the Venezuelan system has been the propaganda.

But maybe propaganda is, in fact, the true essence of socialism.

Zeihan warns,

That is what decivilizational means: a cascade of reinforcing breakdowns that do not simply damage, but destroy, the bedrock of what makes the modern world work. And that’s just one example in one sector.

What is going on in Venezuela is horrible by any measure, and in a world of Order Venezuela is the very definition of outlier. But a world of Order is not the natural state of things. Pay attention: Some shade of what the Venezuelans are going through is what many of us will need to deal with. Soon, the only thing that will truly make Venezuela stand apart is that its pain is self-inflicted.

He expresses his views effectively. I’m not saying you should accept them. But he is worth following. Check out zeihan.com, or listen to this podcast from last month. At the end of the podcast, he makes the interesting point that the number of reliable news sources has shriveled in recent years. Instead of on-the-spot reporting grounded in local knowledge, we get a deluge of opinion from talking heads and twits.

Too little, too late?

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In the WSJ, David Pierce writes,

For $10 a month, you get access to what Apple says is more than 300 titles. I counted 251 magazines in the library, from “ABC Soaps in Depth” to “Zoomer.” Every popular magazine I looked for was available in some form. Besides Wall Street Journal articles, the rest of News+ includes content from the Los Angeles Times plus digital publications like Vox and theSkimm.

This sounds like what I argued for 18 years ago.

Pierce concludes,

As it is now, though, News+ feels like a product several years too late.

Attribution of the other’s motives

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Zara Zareen writes,

Couples who strive to judge each other benevolently — interpreting each other’s good behaviour as deliberate and habitual, and each other’s transgressions as accidental and limited (wherever possible and sensible) — are more likely to be satisfied in their relationships overall.

In political discourse these days, we do the opposite. We see the other’s good behavior as accidental and limited, and we see the other’s bad behavior as deliberate and habitual.

Software development and Austrian economics

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Clive Thompson writes,

Coders might have different backgrounds and political opinions, but nearly every one I’ve ever met found deep, almost soulful pleasure in taking something inefficient—even just a little bit slow—and tightening it up a notch. Removing the friction from a system is an aesthetic joy; coders’ eyes blaze when they talk about making something run faster or how they eliminated some bothersome human effort from a process.

Thompson draws parallels with the capitalist system, and I think he is onto something. The hard-core computer programmer he describes is reminiscent of Israel Kirzner’s description of an entrepreneur as someone who is “alert” to unexploited opportunities for efficiency and profit.

Another Austrian aspect of software development is that production keeps getting more roundabout. Crops are harvested by people using machines that were manufactured by other people who also used machines that were manufactured by. . .Similarly, an new smartphone app uses software already embedded in the phone which in turn uses software in the operating system and software that is embedded in the Internet, etc.

Housing finance policy

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Peter J. Wallison and Edward J. Pinto write,

The Trump administration has finally turned its attention to housing policy. Unfortunately, the president’s Memorandum on Housing Finance Reform, issued last week, is a major disappointment. It will keep taxpayers on the hook for more than $7 trillion in mortgage debt. And it is likely to induce another housing-market bust, for which President Trump will take the blame.

Friday’s WSJ reported that Mark Calabria has been confirmed as head of the Federal Housing Finance Administration. It will be interesting to see what he does.

In my opinion, what he ought to do is the following:

1. Coordinate the credit policy and marketing policy of Freddie Mac, Fannie Mae, and FHA. As it stands now, they are dealing with the same mortgage lenders on somewhat different terms. That situation is ripe for gaming by the mortgage lenders.

2. Get the government out of the business of subsidizing mortgage loans that do not contribute to saving through equity buildup in a primary residence. Stop guaranteeing loans for income properties and for second homes. Stop guaranteeing loans for second mortgages, home equity lines of credit, or cash-out refinances. Stop guaranteeing loans with negative amortization.

3. After that, it might be desirable to gradually reduce the agencies’ presence in mortgage markets. The most straightforward way to do this would be to slowly bring down the maximum size of a mortgage eligible for guarantees by agencies. But this really ought to be done through Congress.