Ryan

Learning slowly, steadily, maybe. 🇨🇦

[Clifford Asness @CliffordAsness]

Aaron Brown’s phenomenal piece of the affordability crisis (I was a glorified repeated editor he kindly added as a co-author, Mike was in-between).

Hint — most of what you read, and certainly what you hear from politicians and activists, is not, you know, right.

[Ryan @Krysos7]

@PythiaR Heard same thing. Especially all the people that got re-orged to data labeling which are looking to switch or leave. That on top of the suprise RL layoffs for orgs told they were safe. Trust in mgmt seems pretty horrible.

[Ryan @Krysos7]

@SowingAlphaSeed @busgus Yes. IIRC initial studies were on US markets, but same thing has been found in intl mkts. Also worth noting this phenomenon is present in factor based strategies too, not just overall index beta. So if you're L/S across these geographies it could look like this. Just my 2c.

[Clifford Asness @CliffordAsness]

One of the dumber things you hear lately, from a lot of supposedly non-dumb people, is “stocks and bonds are now trading positively correlated so you now desperately need this other investment that’s way way more correlated with stocks than are bonds.”

Those investments are the typical. Privates (which are just equity, so it’s “you need more equity to diversify your equity”), buffer funds (which are just equity + cash minus some number), and crypto (which increasingly trades like equity, and is, you know, mostly nonsense, but even if you love it it’s currently bringing more equity exposure than bonds).

My colleagues latest explaining:

[Andrej Karpathy @karpathy]

- Drafted a blog post
- Used an LLM to meticulously improve the argument over 4 hours.
- Wow, feeling great, it’s so convincing!
- Fun idea let’s ask it to argue the opposite.
- LLM demolishes the entire argument and convinces me that the opposite is in fact true.
- lol

The LLMs may elicit an opinion when asked but are extremely competent in arguing almost any direction. This is actually super useful as a tool for forming your own opinions, just make sure to ask different directions and be careful with the sycophancy.

[Prepared Remarks @P_Remarks]

I don’t want to watch the McDonald’s CEO eat a burger. I want to watch Satya use Copilot

[DaRazor @akramsrazor]

Last time there was a mega capex cycle in tech hardware card counting 2nd derivative shops didn't run all marginal liquidity in stocks. Take a sector not built for 2nd derivative valuation extrapolation obsessing and swap it with one that was and then layer on passive flows that amplify that and u get this.

All the other debate stuff misses that this is the core driver. Go look at all the compounder names not saas which have run into same issue. Eventually its about the tool kit that is investing for most, and its not "owning businesses".

[Ryan @Krysos7]

@ContrarianCurse As a fellow Canadian. Just looking at the means test for Old Age Security vs. Canada Child Benefit makes me seethe.

[boaz weinstein @boazweinstein]

Here’s a great line from a third piece in the FT about us this weekend:

Saba Capital, a US hedge fund, has taken an industry that was coasting on habit and heritage and shaken it by the shoulders

Since good things come in threes, I can’t wait for Costas to jump in and write how our tail/crash protection funds which are 200% net short, are down this year.

[Ryan @Krysos7]

@quantbeckman Honestly this paper is very useful on what not to do. This is bad even outside parameter overfit. First sentence of data & methodology as example.

[goodalexander @goodalexander]

@bryan_johnson sit down every day for a month and force yourself to write
1) where you are right now
2) where you want to be
3) the differences between 1&2
4) what a realistic plan would look like to bridge 3
5) one small action that would advance 4

[Alexander Stahel 🌻 @BurggrabenH]

The greatest geopolitical miscalculation of our age: believing that transferring industrial know-how to a one-party state would make it a stakeholder in the free world. Jesus…

In Berlin it was called Wandel durch Handel — change through trade. I almost throw up writing it. What a world-class delusion that was. And not just Merkel’s. Does @Siemens_Energy still try to teach the Chinese how to manufacture gas turbines?

Give Me A Break.

Decades later, that same Wandel turns on us. The supply chains we built are now instruments of pressure for the CCP. Historians will call it the betrayal of the century; realists will call it self-inflicted through greed and short-termism.

For 30 years we Europeans, Americans, Canadians, Japanese, Koreans, and Australians offshored knowledge, refining, training, and IP to the CCP, thinking integration would bring openness and fair trade. @BillClinton and the WTO, anybody? What on rare earth were they thinking?

We — the collective West (in the political, not geographical, sense) — literally taught them everything. Now comrade Xi uses that mastery to choke our supply chains, forcing us to absorb his overcapacity and, effectively, his unemployment.

Who could have thought? As historian Stephen Kotkin likes to say: you can’t be half-communist. Exactly.

The price explosion of germanium below is just one symbol of the lesson ahead.

The blue and red lines show % appreciation for germanium delivered to Europe & the US versus the domestic Chinese price. A kilo now trades at USD 623 (¥4672) for Europe — about twice what Chinese manufacturers pay.

In Europe and the US we pay double for what we taught China to refine and scale for thirty years — the price of assuming Marxism could play by free-market rules.

Among other uses, germanium powers high-end optics such as the Leopard 2 thermal imaging system (Wärmebildgerät, WBG). Not sure if the M1 Abrams uses it too; I never liked that tank. A Ford with a turbine — silly.

Anyway, this isn’t academic. The element — Germanium — is a semiconductor, a kind of metallic chameleon used across high-tech equipment. Not easy to engineer around it. Has a cool name, too.

So China’s export leverage is strategic and real. Meanwhile, the 100 million members of the CCP are, by definition, communists. And for any communist regime, the free world is the enemy. Simple as that.

To a communist, nothing is more dangerous than a free-thinking teenager. One good Netflix series, one spark of criticism, and the streets might fill with people wanting change. Better create an enemy abroad before that happens — that’s the stage of the movie we’re in now.

Enough appeasement. FAFO.

@POTUS @vonderleyen @_FriedrichMerz @Keir_Starmer @EmmanuelMacron @GiorgiaMeloni @alexstubb @SwissGov @nfergus

[Ryan @Krysos7]

@Biohazard3737 There's a Canadian feeder for Millenium that is +2.82% as of end of July w/ a 0.30% onshore fee, so probably not far off.

[Ryan @Krysos7]

@fahdananta I do wonder if Nihilism/gratification themed stocks perform differently depending on how unaffordable housing is to people in their mid 20s & early 30s by geography. Outside of vices, even things like spend at Cineplex is wild in Canada.

[Live Monitor @amlivemon]

Moron

[Jason Kenney 🇨🇦🇺🇦🇮🇱 @jkenney]

In 2010 I brought in sweeping reforms to Canada’s asylum system, which won all party support.

Even the Toronto Star endorsed the changes!

The core statutory reforms were in the Balanced Refugee Reform Act.

As a result of these legal, policy, and operational changes (including judicious use of visa impositions on countries that were large sources of false claims, e.g. Mexico,) we managed to get total new claims down to a record low of 10,000 by 2013!

This meant we could process new claims within weeks, rather than years, giving certainty and protection to bona fide refugees quickly, while removing bogus claimants within months rather than years.

Word went out to international migration networks, including the huge industry of human smugglers and agents who facilitate fake refugee claims, that Canada was no longer a soft target.

But then the Trudeau government systematically reversed those reforms, apparently driven by a toxic combination of naive virtue signalling, and administrative incompetence.

Having blown holes in the model asylum system that we had designed, the Trudeau government then made the catastrophic error of issuing millions of Temporary Resident Visas to low skilled foreign students and workers.

The vast majority of those people came with the hope and expectation that their temporary status would lead to permanent residency. Many (most?) paid large fees to sleazy immigration promoters here and abroad who *promise* their often vulnerable clients that a work or study permit will lead to PR, and with it the ability to sponsor their families to come to Canada.

Every day thousands of those temporary residents “fall out of status,” i.e. their temporary visas expire. Some respect the terms of their admission and leave; others just overstay / go underground, creating an ever larger population of people here illegally; and a growing number make inland asylum claims. The same crooked immigration consultants who promised them a false bill of goods in coming to Canada will often facilitate bogus asylum claims, with cookie cutter templates.

The more claims are made, the larger the queue and the longer the processing times. This becomes a pull factor in itself, as it means people who otherwise would have to leave the country, or go underground, can stay for years benefitting from taxpayer funded housing, health care, and welfare benefits. That’s even if they are from a safe democracy and they have manifestly unfounded asylum claims.

That’s why our asylum system has been overwhelmed by new claims, with 174,000 being filed last year, an increase of 1800% from 2013. This means years to adjudicate claims, and years more to remove bogus claimants who have abused Canada’s generosity.

At the same time, under political pressure from the Trudeau government, the Immigration and Refugee Board has massively increased its acceptance rate for asylum claims, in some cases giving rubber stamped approval to all claims from certain countries without so much as an oral hearing. Of course, this just creates yet another pull factor. (More on this scandal at a later date.)

Canada has always been an open and welcoming country.

We have a moral obligation to provide protection to people here who have a well founded fear of persecution.

But there are practical limits to our generosity. The post war consensus codified in the 1951 Refugee Convention was about creating an orderly, rules based system to protect people facing discrete cases of serious risk, which compelled them to flee tyrannical states. It was never intended to be a back door for mass illegal and irregular migration, exploited by human smugglers and the global migration industry.

Even the Economist, a strongly pro-immigration bulwark of elite liberal opinion, recently recognized this reality.

It is past time for Canada to save the asylum system from total collapse. Reverting to the sensible 2010 era reforms is an obvious place to start.

[Vinny Daniel @Vinny_Daniel0]

Let me translate, if you don’t own assets you better find a way to get some and fast.

[cephalopodshop @macrocephalopod]

Liz Truss hopes you've forgotten how much of a clusterfuck her short period in charge was.

The bottom chart here is the 30 year government bond yield for six developed economies. The top chart is the UK 30y govt bond yield, minus the average of the six countries in the bottom chart, i.e. it's the premium that the UK pays to borrow long term over what other developed economies pay.

The red circle - where the premium increases from close to 0% to nearly 2% in about two months - is the Liz Truss mini budget which crashed the pound, sent mortgage rates soaring and would have bankrupted several major UK pension funds if the Bank of England hadn't stepped in to save her stupid ass.

So where is the hysteria Liz? Not a hard question to answer, as long as you're not completely incompetent.

[Ryan @Krysos7]

As someone who considered graduate studies in both sciences and history, you can bullshit your way through history. Good luck trying that with any math subject.