I am running a bit late in my yearly update but I have been quite busy with the move out of Hong Kong in July 2023, then 5 moves since then; 3 in Montreal, and 2 in Costa Rica.
The 2022 year-end update is here for reference.
Crypto and other tech bubbles
2023 has been another good year to clean the "industry" and pop the bubble of self-deluded "experts" and "investors", luckily with no contagion to the real economy. I see crypto-currencies as very much like casinos; a tax on stupid.
Hopefully, peeps will have learned a little bit from the SBF FTX debacle...
And like casinos, it is not because some people win big that a good investment it makes!
Cryptocurrencies have somewhat rebounded lately with the introduction of crypto-ETFs.
It does not change the fundamental that crypto is a solution in search of problem.
NFTs have died, which had to be the most meaningless and valueless use of blockchain. Good riddance.
However, I believe that blockchain and distributed-ledger technologies do have actual potential as secure & immutable storage of digital contracts.
Meta's Metaverse is still looking for business model to justify its multi-billion dollar losses on the technology. My opinion is that we will never see business people putting on VR goggles just so they can meet. There is not a significant enough improvement over video conf calls. However, Apple might be onto something with its AppleVision; I can see its augmented reality feature in presentation where people and people remote would be at the same table and presentations would leverage the technology to be more engaging and interactive. But, at $3,500, Apple Vision Pro's price tag will have to come down to probably around $500 before it can make headways into the boardrooms and the living rooms, which is a few years away.
AI has more traction and it already has proven valuable to solve numerous real-world problems that have no other solutions in various fields, healthcare being one that I have the most hope for.
However, I do think that there is an AI bubble that has formed in 2023 where VCs throw millions/billions into dubious ventures that have found a way to tag their pitches with AI. Mainly because due diligence is not being performed by these VCs, as there are incentives to do so since they can exit an investment with significant profit before it is revealed to be all fluff. The problem is that it is crowding-out non-AI startups which have more potential to be game changers.
(Added 2024-03-11)
Something I failed to mention before is that Bitcoin mining (the minting of new bitcoins) is not only energy wasteful, but it is also absolutely socially useless; the complex mathematical equations it resolves have no benefit to humanity.
I am quite certain that if extensive economic modeling was done on Bitcoins, it would reveal to be a negative-sum gain system.
Covid-19
"...at this point, touch wood and hope that the pandemic is truly behind us."
That is what I had to say in my November 2022 update. Since then, the new cases and deaths have mostly abated and Covid has become endemic, rather than epidemic.
While many of the crazies claim that they were right all along and that people are dying in droves from the vaccine, with no credible evidence (The likes of Joe Rogan making outlandish claims that Covid vaccination has reduced life expectancy in Canada, which obviously has no foundation in reality and has been debunked).
However, a lot of the Covid conspirogrifters that profited from spreading the lies that have not diverted to other solid and sustainable sources of conspiratorial income have seen their viewership dwindle. As of January 2024, once very popular conspiracy grifters such as Andre Pitre and Alexis Cossette Trudel in Quebec saw their audiences shrink to a fraction of what it was just a couple of years ago; Pitre rarely gets more than 5 thousand views per video, where Trudel gets about 25 thousand, hopefully relegating their venture back to the inoffensive crazy-bin hobby where it belongs...
Hong Kong
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| Hong Kong stock market still doing "amazing" compared to the U.S' S&P 500! |
And Article 23 will be the nail in Hong Kong's "World City" coffin...
China:
Read Krugman's piece about the Chinese economy here. Basically what I have been saying for a few years now... (It's dead Jim)
Culture of mediocrity:
My wife and I have lived in Hong Kong for 15 years, returning to Montreal in July 2023.
One thing that grows on you in Hong Kong, is how efficient the place is; from public transportation to even dealing with government services; Hong Kongers demand utmost efficiency and for problems to be solved as quickly as possible. We will see how that fares in the next few years with the new regime, but that is another story.
Anyhow, coming back to Montreal, I was shocked at how people seem to have given-up on efficiency and common sense. A few examples:
- Metro exits are not numbered so it is hard to set a rendezvous point at an exit.
- Signage is poor. To the point that a design student took matter in his own hands.
- Payment for public transport is absolutely idiotic; one has to get 'tickets' in one's Opus card rather than the card being a payment system or, like most place in the modern world, just accept credit cards!
- There are tags everywhere, even if Montreal is very safe, they make the city feel like a shady American neighborhood riddled with crime (tags are most often associated with street gangs).
That's a tag. That's a graffiti/mural, not a tag... So is this one... ...and that is a mural/graffiti being vandalized by a tagger.
- Downtown's homelessness is everywhere and RESO, the network of underground connection between all the metro station feels unsafe and smells of urine at places.
- In Hong Kong, which never sees freezing cold temperature, all metro stations are connected to the housing developments nearby. In Montreal, there seems to be no willingness to continue expanding RESO downtown although it would be great in the cold winters.
- The indoor space usage of new condos is absolutely terrible; where 600 sqft in Hong Kong give you a usable 2 bedrooms, Montreal will have space arrangement that make it feel so small and does not provide any useful storage space.
There are solutions for all of these problems but people have to demand them to be addressed. It just feels like "good enough, it is better than some other places" mentality is prevailing.
Montreal is Quebec's metropolis and represent the majority of its GDP. I wished Montrealers would demand more...
Canadian housing affordability: not the Canada I remembered!
(added 2024-MAR-07)
When we bought our first house, in Ottawa, in 2003, the ratio of average house price over yearly household median income was very reasonable at about 3.2 ($218,600 / $68,500). Meaning that it would take 3.2 years worth of median gross household income to pay for one's house. Montreal had about the same ratio.
We moved to Hong Kong in 2008 and lived there for 15 years. As Hong Kong is always cited as one of the most expensive real-estate market in the world, we were expecting to come back to Montreal and see our real-estate dollar go quite far. Well... not quite!
In Montreal, as of December 2023, that ratio has jumped to 8.2 ! ($508,300 / $61,747). Ottawa was better at 6.2 (mostly because the wages increased faster in Ottawa).
That is just insane. And if you are no convinced, have a look at this little animation which put it in historical perspective.
Now, how does housing price and costs to household compare to some other places in the world? Well, Canada, in 2024, has among the costliest housing & worst housing affordability in the world ! See here, here, and here.
What differentiates Canada is the much faster population growth compared to other Western countries since 2000, sometimes double or triple the rate of growth (here, here, and here).
What differentiates Canada is the much faster population growth compared to other Western countries since 2000, sometimes double or triple the rate of growth (here, here, and here).
Yet, housing start have not matched that growth as is described here.
Taming the interest rates will not help in making housing more affordable in Canada, because it will not address the problem of supply. If anything, it will make the house prices go even higher.
Canada needs an aggressive policy to increase the housing supply. Or reduce immigration. The former would be my preference, as it will promote more economic growth.
Ukraine war, and Russia
First, a little update on the situation: In 2023, Russia has found nice partners in crime in China, North-Korea, and Iran. Truly the axis of goodness in this modern world!
If this does not convince everyone of which side democracy and freedom lovers should be, I do not know what could possibly convince them...
If this does not convince everyone of which side democracy and freedom lovers should be, I do not know what could possibly convince them...
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| January 2023 on top. January 2024 below. |
Very little territorial change. However, the Russian army has been severely attrited (and here), both in terms of equipment and manpower. It is very interesting to see that, at 9,349, the UAF report of lost Russia artillery almost exactly match the calculated losses from satellite observation from Covert Cabal (9,334). There would be 9,747 artillery system left for Russia to use/refurbish. If we suppose their production of new artillery pieces is marginal and we simply assume that Ukraine will continue to destroy them at the current yearly averaged rate, no matter how many munitions Russia has for its artillery, they will run out of systems to fire them, roughly by February 2026.
As I mentioned before, I am not qualified to judge what kind of strategy or equipment would make a significant difference for the Ukrainian army. However, if Wikipedia is to be trusted, Ukraine currently have 102 active combat aircrafts, and the planned provision of 60+ F16s, while not being a silver-bullet, would be a significant quantitative and qualitative addition to Ukraine's air combat capabilities.
Ukraine has also asked for the U.S. to send them their retiring A-10s. Opinions diverge as to whether the aircraft is suited for the job in Ukraine or not, but I cannot imagine how such a donation could have no, or negative value in repelling the Russian invasion.
It is also to be hoped for that the non-MAGA republicains will see the bigger picture and vote for the $95B aid package to Ukraine and Israel.
If the U.S and Europe will not build a large, combined force (150+ F-16, 150+ A-10, ATACMS, more Bradleys, millions of artillery shells and 500+ self-propelled artillery to deliver these), the war of attrition will be won by whoever outlast the other and then, cheap yet effective equipment will make the difference, such as Vampire shooting down Shaheds with APKWS (1 , 2, 3, 4).
In terms of military hardware, Ukraine is in a better position today than they were at the same time last year. The big unknown is how many soldiers they have left, because that cannot be provided by the West. This is the one variable that will decide who wins this war; can Ukraine's manpower outlasts Russia's, provided the current Russia/Ukraine attrition ratios. And what is the equipment that can be sent to significantly increase this ratio.
Because I am a democrat and anywhere in the world where an autocrat is attempting regime change in a democracy, I feel that history is going backwards. I lived it in Hong Kong.
Because I have seen the exact same scenario play-out in Hong Kong and Macau, in the South China Sea, and over Taiwan; totalitarian regimes always have the same playbook: first, the dictatorship will deny that anything is happening. Then, it will claim that what they are doing is very routine and no one should worry. Then, it will state that it was always the plan, than the land has always been theirs (as per their static, biased, and demonstrably false reading of history), that it is that is a national interest question that should not concern the international community. Always, always, always the same playbook...
It is never for the good of the people the dictator rule over; it is always about ego and hubris, leaving a name in history. He will stoke nationalistic fervor and push for imperialistic conquests under the guise of return to a previous, glorious state of the empire (wherever Xi claims the 'Han' to ever have been, wherever Russian was spoken for Putin, and whenever time Trump pretends was great)
One might argue that Ukraine is not a great democracy. That is not as relevant as the progress it has made, and where it is headed. While it is already more democratic than Russia, Ukraine is taking steps to fight corruption and improve its democratic institutions. And with its aim to join the E.U, it will need to show these reform are working.
As I was writing these lines, the entertainer Tucker Carlson conducted an 'interview' with Putin which went as everyone expected: Putin was not meaningfully challenged.
The full interview is on YouTube here. If, after watching it, you think: "Well, it wasn't that bad, he challenged him on the wrongly imprisoned WSJ journalist, I would suggest you watch real journalists conducting interviews with the dictator, here, here, and here.
A few comments on what was said in the "interview":
1. Putin says he would not invade Poland or Latvia:
Putin also said he would not invade Ukraine back in November 2021, then restated that all these invasion ideas were U.S propaganda and that there was no plans to invade (1, 2, 3, 4), while he was piling his military resources at the border and U.S intelligence warned an incredulous Zelenski of the impending invasion. Nothing happened in between February 18th when Putin stated that the Russian troops amassed at the Ukrainian borders just completed a planned military exercise and Feb 22nd that could have justified that invasion. Putin was obviously lying.
Another example of this is when Putin was supporting separatists in Georgia; in 2008, a proper journalist asked him whether Ukraine should be concerned about his ambitions for Crimea which he denied having any interests in. Why would he be trusted for any other statement or guarantee he is making?
Another example of this is when Putin was supporting separatists in Georgia; in 2008, a proper journalist asked him whether Ukraine should be concerned about his ambitions for Crimea which he denied having any interests in. Why would he be trusted for any other statement or guarantee he is making?
2. The false narrative that the U.S promised not to expand NATO beyond Germany.
Why would it matter if it did? NATO is a defensive alliance and, obviously, the baltic states felt that they were vulnerable and asked to join, and the U.S. cannot force Ukraine to join. Why is Putin afraid of a defensive alliance, if not that it limits his desire to reclaim what he considers historical Russia? Putin has demonstrated in Chechnya, Georgia, and now Ukraine that the countries that have joined NATO since WWII were right to be worried.
3. More was talked about the usual Kremlin debunked propaganda about Putin being ready to negotiate all along but the evil Western block would prevent an agreement via Boris Johnson (1, 2, 3).
At face value, this implies that Ukraine had no agency in the negotiation, which is ludicrous.
The bottom line is that Putin was only ever willing to negotiate to the extent that he can get everything he wants. This is not negotiation, it is Ukraine becoming a vassal to Russia.
4. The little history lesson Putin gave did not have much to do with reality but should have informed MAGA and its ilk to the true and avoyed intentions of Putin; deny the right to existence to the sovereign nation that is Ukraine, and re-establish Novorossiya. That was not something new; Putin had stated as much, many times before, and all the way back to 2014 (1, 2, 3, 4). But ever more probative; in September 2022, after a sham referendum, Putin unilaterally annexed Ukrainian territories, while the war was still being waged! I am not sure what other evidence is required that his goals were always to invade and annex Ukrainian territory.
Would Putin desire to see Belarus fold into the Russian federation not be additional validation of his ultimate goal? Putin has stated in 2011 that unification would be possible and desirable, while Belarusians are against it.
After having written this entry, I saw Timothy Snyder's post on Substack. M. Snyder is a professor of history at Yale University, specializing in the history of Central and Eastern Europe, the Soviet Union, and the Holocaust. My take broadly aligns with his but he obviously can explain it with a much richer historical perspective. Have a read, here. The Economist also has good piece here.
I have also recently read in the MAGA-infested X that "Ukraine is corrupt and the billions sent are not helping. Zelenskyy is buying yachts with the money". This warrants some context/debunking.
a. Indeed, Ukraine ranks low on the corruption-free index (36/100 pts) but has improved significantly since 2014. Worth noting that Russia performs even worse (26/100 pts) and has been perceived as increasingly corrupt since 2020.
b. Most of the money pledged is staying in the U.S: "Funds that lawmakers approve to arm Ukraine are not going directly to Ukraine but being used stateside to build new weapons or to replace weapons sent to Kyiv from U.S. stockpiles. Of the $68 billion in military and related assistance Congress has approved since Russia invaded Ukraine, almost 90 percent is going to Americans, one analysis found."
c. Zelenskiy is not buying yachts with the money. That is bunk. You may want to ask yourself who has an interest for you to believe this lie.
Crimea is an interesting topic in itself; mostly Russian populated, the unilateral annexation by Russia accompanied with a sham referendum was declared illegal by the U.N.
As part of a Ukraine ceasefire negotiation, once both parties have moved their armies out of all occupied territories, it would seem that Crimeans should be deciding their own future. A U.N/NATO supervised referendum could be conducted where they would be asked whether they want 1. Crimea to be internationally recognized as part of Russia, 2. Return to Ukraine, or 3. Become and independent state. And if they chose to become independent, whether they would want to eventually be part of the European Union.
As part of a Ukraine ceasefire negotiation, once both parties have moved their armies out of all occupied territories, it would seem that Crimeans should be deciding their own future. A U.N/NATO supervised referendum could be conducted where they would be asked whether they want 1. Crimea to be internationally recognized as part of Russia, 2. Return to Ukraine, or 3. Become and independent state. And if they chose to become independent, whether they would want to eventually be part of the European Union.
Breaking on 2024-02-10: The orange GOP village idiot stated at a campaign rally that he would like Russia to do whatever they want to countries that do not pay their "NATO dues" and the U.S would not intervene. Trump does not seem to understand how NATO works; the alliance is not based on 'dues' but rather, requires 2% of GDP to be invested in defense by member nations. It is sad to see the GOP defending Trump's insane remarks, and then having to deal with the risks in roundabout way because they know his policies are neither good for the free world, nor for America. In the case of 'getting out of NATO', a bipartisan bill was passed recently, making it impossible for Trump to unilaterally get out. Trump's rhetoric is more than having all NATO partners contributing their fair share; he seem to be fundamentally opposed to the idea of NATO as a defensive block as stated in its article 5.
(Added 2024-03-09)
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| Source: U.N |
"At least 10,000 civilians, including over 560 children, have been killed and more than 18,500 injured since Russia launched its full-scale invasion of Ukraine in February last year"
- UN Human Rights Monitoring Mission
2024 will be a momentous year for what becomes of American democracy
Nevermind that Trump has made no ground breaking new policy announcements, that his mandate did not deliver much improvement over the prior, and that Biden's implemented policies have yielded much better results, this is not the reason why he must not get back in power. He should not get back in power because he illegally attempted to prevent the peaceful transfer of power during an election that he knew he lost fair-and-square. Bad policies can be undone by good ones. But leaving treason unaccounted for would be forever tainting America's ability to project the democratic ideals, and would mark the historical starting point of its demise.
The only way Trump can be held accountable for his criminal behaviors is for him to be convicted and go to jail.
The only way Trump can be held accountable for his criminal behaviors is for him to be convicted and go to jail.
It is also seems that it is the only way that some Americans become aware of his misdeeds and hold him accountable at the voting booth.
This excellent article by Philip Bump, highlights the situation...
"YouGov presented American adults with eight legal scenarios to judge the extent of the public’s awareness"
Six of these scenarios were real, and two were invented. The majority of Republicans were unaware of the six true scenarios.
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| Source: Philip Bump, Washington Post |
"It seems very safe to assume this lack of familiarity derives from disinterest in hearing negative information about Trump — and, probably more importantly, the disinterest of conservative and right-wing media outlets to report on them. In May, The Washington Post looked at the extent to which Fox News covered the documents and Daniels cases relative to other cable-news channels. It did so much less frequently."
However, the answers given to the question asked about the candidates' fitness to be president offer an important insight as to the opportunity the Democrats have to make some much necessary gains in the coming race for the presidency.
As Biden's age is a known variable, it is already reflected in the polls which put him neck and neck with Trump (As of January 2024, here). As such, the 'Biden's Age' data point is not material. However, since most independents and Republicans are unaware of the charges, making that information reach these voters would have a potentially devastating effect on Trump's campaign. As Bump puts it:
"...responses from independents mostly matched the overall numbers, which is often the case. That means only about half of independents are aware of Trump’s legal issues — potentially meaning there is a large group of Americans who might suddenly learn the details of what’s been alleged if Trump is convicted of a crime.That is the sort of thing that might have a measurable political effect."
A conviction would, of course, make the information spread to nearly everyone. A conviction would also make it impossible for Trump to get the number of votes he needs for a second mandate, as highlighted in another article from M. Bump:
However, it might not be necessary to wait for that. It would seem logical that the focus of the Biden team should be on reaching out to independants and raising visibility on Trump's legal predicaments. I would argue that breaking into the Republican and Trump voters' echo chambers would achieve the goal of educating Republicans as to the predicament Trump is currently in (targeting ads on FOX, OAN, NewsMAX, presenting factual data about Trump's legal situation. Setting-up a dedicated Web site for this by never-trumper Republicans).
Getting just 5% of Republicans and maybe 10-15% of independants to pay attention enough to switch over and decide that there are less risks in electing an elderly Democrat than a wanna be autocrat.
The November 2024 election results in the U.S will be a large part of the answer as to whether liberal democracy is receding...
