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Tuesday Links – January 25, 2022

Monday, January 25, 2022Volume 3, Issue 6 “Probably the greatest harm done by vast wealth is the harm that we of moderate means do ourselves when we let the vices of envy and hatred enter deep into our own natures.” — Theodore
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Monday, January 25, 2022
Volume 3, Issue 6

“Probably the greatest harm done by vast wealth is the harm that we of moderate means do ourselves when we let the vices of envy and hatred enter deep into our own natures.”

— Theodore Roosevelt

Articles

Money and Payments: The U.S. Dollar in the Age of Digital Transformation, Board of Governors of the Federal Reserve System, January 20, 2022. The Fed has released a white paper discussing potential plans to introduce a digital currency in the United States. Although the Fed is stating that no decisions have been made regarding how to proceed, the paper resulted in much attention and criticism, including my own comments written in a Twitter thread and the Wall Street Journal’s coverage on January 21. The Fed is currently accepting comments on the paper. (Federal Reserve)

Warren Buffett closes in on Cathie Wood as tech stocks tumble by Robin Wigglesworth, January 22, 2022. Cathie Wood’s Ark Innovation ETF is on the verge of being overtaken by Warren Buffett’s Berkshire Hathaway since the start of the pandemic. Ms. Wood made headlines last month when she projected a 30-40 percent compound annual return over the next five years. In contrast, Mr. Buffett has never projected the price of Berkshire stock. Markets gyrated wildly on Monday with Ark Innovation trading in a range of $64.98 to $73.57 and Berkshire Hathaway’s B class of common stock trading in a range of $296.08 to $304.73. (Financial Times)

Wildfire Risk in California Drives Insurers to Pull Policies for Pricey Homes by Leslie Scism, January 19, 2022. Insurers are reevaluating the risk of wildfires in California and other western states. Changing climate patters have made regions more prone to fires than historical data might suggest. One statistic that struck me was that California homes in the $10 million range carry insurance premiums in the $20,000 to $40,000 range. While this is a big dollar amount in absolute terms, it is only 0.20-0.40% of property value in a region with poorly defined future risk profiles. (WSJ)

How ‘Treat Yourself’ Became a Capitalist Command by Ester Bloom, November 19, 2015. Every Saturday, the Wall Street Journal publishes a section called “Off Duty” which is meant to highlight recreational pursuits for wealthy individuals. I couldn’t resist making a sarcastic comment on Twitter regarding how the marketing term “self-care” is brilliant because it frames luxury spending in terms of health and wellness. A reader responded with this interesting article which provides some history behind the self-care industry and how it evolved in recent decades. (The Atlantic)

The Huge Tax Bills That Came Out of Nowhere at Vanguard by Jason Zweig, January 21, 2022. Mutual funds have often surprised shareholders with unexpected distributions toward year-end. For this reason, many investors prefer to hold mutual funds with a history of distributions in tax-deferred retirement accounts. Vanguard has a long-standing reputation for tax-efficiency when it comes to fund distributions but unfortunately this was not the case recently with its target-date retirement funds. Due to large investors shifting to a lower-fee version of the fund, small investors were left holding the bag with large distribution of realized gains at yearend. (WSJ)

The High Cost of an Easy Job by Nick Maggiulli, January 18, 2022. It is important to strive to live a life of purpose and accomplishment: “Why do work when you can not work, right? Why build something when you could not build it?  The choice seems obvious, doesn’t it? But the easy choices come with hard consequences…later. They show up where you might not expect them. With regret. With nostalgia. With sadness. The easy way out always has hidden costs. The question is: are you willing to pay them?” (Of Dollars and Data)

The Time Trap of Productivity by Lawrence Yeo, January 2022. Time is definitely our most precious asset, but over scheduling has downsides: “By scheduling your day down to the last minute, you introduce an anxiety from managing your real-time progress to an imagined vision. Each glance at the clock fires off a thought about whether your day is going like it’s supposed to, or if you’re falling behind. This is a mind that always views the present through the lens of past and future, and can never be anchored in the now.” (More to That)

If You Only Read a Few Books in 2022, Read These by Ryan Holiday, January 20, 2022. Some interesting reading ideas: “Books are an investment in yourself—investments that come in many forms: novels, nonfiction, how-to, poetry, classics, biographies. They help you think more clearly, be kinder, see the bigger picture, and improve at the things that matter to you. Books are a tradition that stretches back thousands of years and stretches forward to today, where people are still publishing distillations of countless hours of hard thinking on hard topics. Why wouldn’t you avail yourself of this wisdom?” (RyanHoliday.net)

Podcasts and Videos

Nassim Taleb: How to Look at the Risks of Covid Vaccines, January 2, 2022. Nassim Taleb’s precautionary principle has been cited by individuals skeptical of the COVID-19 vaccines, but Taleb himself has come out strongly in favor of widespread vaccination efforts. This video is a brief explanation of why Taleb has taken his current position on vaccines and how the precautionary principle applies in this case. His emphasis is on considering the risks of the vaccine alongside the risks of contracting and spreading COVID. I found his argument compelling. (YouTube)

How Paul Graham Went From Painter to YCombinator Founder, January 21, 2022. “Paul Graham is the co-founder of Y-Combinator, which is arguably the world’s most successful startup studio. His artistic background, combined with his technical genius, has helped him become one of the most successful writers and entrepreneurs in Silicon Valley. So how does this proudly self-proclaimed ‘nerd’ who stopped watching TV at the age of 13 continue to find success while circumventing convention?” (David Perell/YouTube)

Peloton: Reinventing the Wheel, January 18, 2022. This is an interesting discussion regarding Peloton’s business model in light of the recent pummeling of its stock price. “Peloton was founded over 10 years ago with the idea of making the best in-person spin classes available at home. By delivering eye-catching hardware and compelling content, it has since become the largest interactive fitness platform in the world with over 6 million members. Peloton’s rise has not been without challenges, however, and the business’s economic model is under debate as we speak.” (Business Breakdowns) 

Books

Early Bird: The Power of Investing Young, 2nd Edition by Maya Peterson and Soren Peterson. In 2018, I reviewed the first edition of Early Bird written by Maya Peterson who was just fifteen years old at the time. The first edition was a great introduction to investing for young people. In the second edition, Soren Peterson contributes content including a new interview with Ian Cassel, a well-known investor in the micro-cap field, and the author of The Intelligent Fanatics Project. Young people have a major advantage when it comes to investing because they have much more time for compounding to work its magic. Financial literacy is abysmal in the United States, and it is great to see young people like Maya and Soren take it upon themselves to educate their peers. Maya is also the author of Lighthouse: Women Leading the Way in Finance, which I reviewed in 2020. For more background, I recommend this interview published by 7Investing: The Power of Investing Young with Maya and Soren Peterson.

The Emperor of All Maladies: A Biography of Cancer by Siddhartha Mukherjee. Mukherjee has a rare talent for documenting history and complex medical topics while also telling the very human stories about lives impacted by cancer. As a practicing cancer physician, Mukherjee explains how our understanding of cancer has evolved over time, the advances in surgery, chemotherapy, radiology, and immunotherapies, and generally equips us to be better informed patients in the event of a diagnosis. Understanding the tradeoffs involved in various forms of treatment, the prospect of a cure or long-term remission, and when a situation can best be dealt with in a palliative manner are topics best approached before a crisis. 

Miscellaneous 

Berkshire Hathaway Announces In-Person Annual Meeting After two years of virtual meetings due to the pandemic. Berkshire Hathaway has announced that this year’s meeting will occur in person on April 30. The meeting will also be available via webcast. Berkshire’s annual report along with Warren Buffett’s letter to shareholders will be posted to the company’s website on February 26. (Berkshire Hathaway)

James Clear’s 30 Days to Better Habits This is a free online course that I recently signed up for which includes suggestions for developing better habits. I have mentioned James Clear’s book, Atomic Habits, several times and wrote a review of the book last year. So far, this email course has presented some of the best ideas from the book as well as supplementary information. “30 Days to Better Habits and Atomic Habits are complementary. While you should expect many of the core ideas to be the same, the course is full of many new examples and applications that you can’t find in the book. When combined, the book and the course deliver a powerful, 1-2 punch.” (JamesClear.com)

The Bear Cave Newsletter by Edwin Dorsey. This newsletter is meant for short-sellers and has free and paid content. I’m not a short seller, but I find the free Sunday newsletter interesting because the author often compiles lists of resignations from public companies, as disclosed in SEC filings. Resignations for mysterious reasons or after short tenures, especially in the CFO position, can signal serious problems, so it is interesting information to follow. When you read that someone resigned to “pursue other opportunities”, chances are that there is more to the story. (The Bear Cave)

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The post Tuesday Links – January 25, 2022 first appeared on The Rational Walk.

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Homes listed for sale in early June sell for $7,700 more

New Zillow research suggests the spring home shopping season may see a second wave this summer if mortgage rates fall
The post Homes listed for sale in…

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  • A Zillow analysis of 2023 home sales finds homes listed in the first two weeks of June sold for 2.3% more. 
  • The best time to list a home for sale is a month later than it was in 2019, likely driven by mortgage rates.
  • The best time to list can be as early as the second half of February in San Francisco, and as late as the first half of July in New York and Philadelphia. 

Spring home sellers looking to maximize their sale price may want to wait it out and list their home for sale in the first half of June. A new Zillow® analysis of 2023 sales found that homes listed in the first two weeks of June sold for 2.3% more, a $7,700 boost on a typical U.S. home.  

The best time to list consistently had been early May in the years leading up to the pandemic. The shift to June suggests mortgage rates are strongly influencing demand on top of the usual seasonality that brings buyers to the market in the spring. This home-shopping season is poised to follow a similar pattern as that in 2023, with the potential for a second wave if the Federal Reserve lowers interest rates midyear or later. 

The 2.3% sale price premium registered last June followed the first spring in more than 15 years with mortgage rates over 6% on a 30-year fixed-rate loan. The high rates put home buyers on the back foot, and as rates continued upward through May, they were still reassessing and less likely to bid boldly. In June, however, rates pulled back a little from 6.79% to 6.67%, which likely presented an opportunity for determined buyers heading into summer. More buyers understood their market position and could afford to transact, boosting competition and sale prices.

The old logic was that sellers could earn a premium by listing in late spring, when search activity hit its peak. Now, with persistently low inventory, mortgage rate fluctuations make their own seasonality. First-time home buyers who are on the edge of qualifying for a home loan may dip in and out of the market, depending on what’s happening with rates. It is almost certain the Federal Reserve will push back any interest-rate cuts to mid-2024 at the earliest. If mortgage rates follow, that could bring another surge of buyers later this year.

Mortgage rates have been impacting affordability and sale prices since they began rising rapidly two years ago. In 2022, sellers nationwide saw the highest sale premium when they listed their home in late March, right before rates barreled past 5% and continued climbing. 

Zillow’s research finds the best time to list can vary widely by metropolitan area. In 2023, it was as early as the second half of February in San Francisco, and as late as the first half of July in New York. Thirty of the top 35 largest metro areas saw for-sale listings command the highest sale prices between May and early July last year. 

Zillow also found a wide range in the sale price premiums associated with homes listed during those peak periods. At the hottest time of the year in San Jose, homes sold for 5.5% more, a $88,000 boost on a typical home. Meanwhile, homes in San Antonio sold for 1.9% more during that same time period.  

 

Metropolitan Area Best Time to List Price Premium Dollar Boost
United States First half of June 2.3% $7,700
New York, NY First half of July 2.4% $15,500
Los Angeles, CA First half of May 4.1% $39,300
Chicago, IL First half of June 2.8% $8,800
Dallas, TX First half of June 2.5% $9,200
Houston, TX Second half of April 2.0% $6,200
Washington, DC Second half of June 2.2% $12,700
Philadelphia, PA First half of July 2.4% $8,200
Miami, FL First half of June 2.3% $12,900
Atlanta, GA Second half of June 2.3% $8,700
Boston, MA Second half of May 3.5% $23,600
Phoenix, AZ First half of June 3.2% $14,700
San Francisco, CA Second half of February 4.2% $50,300
Riverside, CA First half of May 2.7% $15,600
Detroit, MI First half of July 3.3% $7,900
Seattle, WA First half of June 4.3% $31,500
Minneapolis, MN Second half of May 3.7% $13,400
San Diego, CA Second half of April 3.1% $29,600
Tampa, FL Second half of June 2.1% $8,000
Denver, CO Second half of May 2.9% $16,900
Baltimore, MD First half of July 2.2% $8,200
St. Louis, MO First half of June 2.9% $7,000
Orlando, FL First half of June 2.2% $8,700
Charlotte, NC Second half of May 3.0% $11,000
San Antonio, TX First half of June 1.9% $5,400
Portland, OR Second half of April 2.6% $14,300
Sacramento, CA First half of June 3.2% $17,900
Pittsburgh, PA Second half of June 2.3% $4,700
Cincinnati, OH Second half of April 2.7% $7,500
Austin, TX Second half of May 2.8% $12,600
Las Vegas, NV First half of June 3.4% $14,600
Kansas City, MO Second half of May 2.5% $7,300
Columbus, OH Second half of June 3.3% $10,400
Indianapolis, IN First half of July 3.0% $8,100
Cleveland, OH First half of July  3.4% $7,400
San Jose, CA First half of June 5.5% $88,400

 

The post Homes listed for sale in early June sell for $7,700 more appeared first on Zillow Research.

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Survey Shows Declining Concerns Among Americans About COVID-19

Survey Shows Declining Concerns Among Americans About COVID-19

A new survey reveals that only 20% of Americans view covid-19 as "a major threat"…

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March 11, 2024

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Survey Shows Declining Concerns Among Americans About COVID-19

A new survey reveals that only 20% of Americans view covid-19 as "a major threat" to the health of the US population - a sharp decline from a high of 67% in July 2020.

(SARMDY/Shutterstock)

What's more, the Pew Research Center survey conducted from Feb. 7 to Feb. 11 showed that just 10% of Americans are concerned that they will  catch the disease and require hospitalization.

"This data represents a low ebb of public concern about the virus that reached its height in the summer and fall of 2020, when as many as two-thirds of Americans viewed COVID-19 as a major threat to public health," reads the report, which was published March 7.

According to the survey, half of the participants understand the significance of researchers and healthcare providers in understanding and treating long COVID - however 27% of participants consider this issue less important, while 22% of Americans are unaware of long COVID.

What's more, while Democrats were far more worried than Republicans in the past, that gap has narrowed significantly.

"In the pandemic’s first year, Democrats were routinely about 40 points more likely than Republicans to view the coronavirus as a major threat to the health of the U.S. population. This gap has waned as overall levels of concern have fallen," reads the report.

More via the Epoch Times;

The survey found that three in ten Democrats under 50 have received an updated COVID-19 vaccine, compared with 66 percent of Democrats ages 65 and older.

Moreover, 66 percent of Democrats ages 65 and older have received the updated COVID-19 vaccine, while only 24 percent of Republicans ages 65 and older have done so.

“This 42-point partisan gap is much wider now than at other points since the start of the outbreak. For instance, in August 2021, 93 percent of older Democrats and 78 percent of older Republicans said they had received all the shots needed to be fully vaccinated (a 15-point gap),” it noted.

COVID-19 No Longer an Emergency

The U.S. Centers for Disease Control and Prevention (CDC) recently issued its updated recommendations for the virus, which no longer require people to stay home for five days after testing positive for COVID-19.

The updated guidance recommends that people who contracted a respiratory virus stay home, and they can resume normal activities when their symptoms improve overall and their fever subsides for 24 hours without medication.

“We still must use the commonsense solutions we know work to protect ourselves and others from serious illness from respiratory viruses, this includes vaccination, treatment, and staying home when we get sick,” CDC director Dr. Mandy Cohen said in a statement.

The CDC said that while the virus remains a threat, it is now less likely to cause severe illness because of widespread immunity and improved tools to prevent and treat the disease.

“Importantly, states and countries that have already adjusted recommended isolation times have not seen increased hospitalizations or deaths related to COVID-19,” it stated.

The federal government suspended its free at-home COVID-19 test program on March 8, according to a website set up by the government, following a decrease in COVID-19-related hospitalizations.

According to the CDC, hospitalization rates for COVID-19 and influenza diseases remain “elevated” but are decreasing in some parts of the United States.

Tyler Durden Sun, 03/10/2024 - 22:45

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Rand Paul Teases Senate GOP Leader Run – Musk Says “I Would Support”

Rand Paul Teases Senate GOP Leader Run – Musk Says "I Would Support"

Republican Kentucky Senator Rand Paul on Friday hinted that he may jump…

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March 10, 2024

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Rand Paul Teases Senate GOP Leader Run - Musk Says "I Would Support"

Republican Kentucky Senator Rand Paul on Friday hinted that he may jump into the race to become the next Senate GOP leader, and Elon Musk was quick to support the idea. Republicans must find a successor for periodically malfunctioning Mitch McConnell, who recently announced he'll step down in November, though intending to keep his Senate seat until his term ends in January 2027, when he'd be within weeks of turning 86. 

So far, the announced field consists of two quintessential establishment types: John Cornyn of Texas and John Thune of South Dakota. While John Barrasso's name had been thrown around as one of "The Three Johns" considered top contenders, the Wyoming senator on Tuesday said he'll instead seek the number two slot as party whip. 

Paul used X to tease his potential bid for the position which -- if the GOP takes back the upper chamber in November -- could graduate from Minority Leader to Majority Leader. He started by telling his 5.1 million followers he'd had lots of people asking him about his interest in running...

...then followed up with a poll in which he predictably annihilated Cornyn and Thune, taking a 96% share as of Friday night, with the other two below 2% each. 

Elon Musk was quick to back the idea of Paul as GOP leader, while daring Cornyn and Thune to follow Paul's lead by throwing their names out for consideration by the Twitter-verse X-verse. 

Paul has been a stalwart opponent of security-state mass surveillance, foreign interventionism -- to include shoveling billions of dollars into the proxy war in Ukraine -- and out-of-control spending in general. He demonstrated the latter passion on the Senate floor this week as he ridiculed the latest kick-the-can spending package:   

In February, Paul used Senate rules to force his colleagues into a grueling Super Bowl weekend of votes, as he worked to derail a $95 billion foreign aid bill. "I think we should stay here as long as it takes,” said Paul. “If it takes a week or a month, I’ll force them to stay here to discuss why they think the border of Ukraine is more important than the US border.”

Don't expect a Majority Leader Paul to ditch the filibuster -- he's been a hardy user of the legislative delay tactic. In 2013, he spoke for 13 hours to fight the nomination of John Brennan as CIA director. In 2015, he orated for 10-and-a-half-hours to oppose extension of the Patriot Act. 

Rand Paul amid his 10 1/2 hour filibuster in 2015

Among the general public, Paul is probably best known as Capitol Hill's chief tormentor of Dr. Anthony Fauci, who was director of the National Institute of Allergy and Infectious Disease during the Covid-19 pandemic. Paul says the evidence indicates the virus emerged from China's Wuhan Institute of Virology. He's accused Fauci and other members of the US government public health apparatus of evading questions about their funding of the Chinese lab's "gain of function" research, which takes natural viruses and morphs them into something more dangerous. Paul has pointedly said that Fauci committed perjury in congressional hearings and that he belongs in jail "without question."   

Musk is neither the only nor the first noteworthy figure to back Paul for party leader. Just hours after McConnell announced his upcoming step-down from leadership, independent 2024 presidential candidate Robert F. Kennedy, Jr voiced his support: 

In a testament to the extent to which the establishment recoils at the libertarian-minded Paul, mainstream media outlets -- which have been quick to report on other developments in the majority leader race -- pretended not to notice that Paul had signaled his interest in the job. More than 24 hours after Paul's test-the-waters tweet-fest began, not a single major outlet had brought it to the attention of their audience. 

That may be his strongest endorsement yet. 

Tyler Durden Sun, 03/10/2024 - 20:25

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