A visit to social security, recession dissonance
Recession dissonance and inflation. Walking around Boston, healthcare optimism. Transport enthusiasm trip, a cold-call reach out. UK green power grid report. Silicon Valley Bank: mistakes and a sorrow
There is a dissonance. Financial market participants could say this is the most expected recession (if recession does occur) in history. Certainly, many financial markets people expect a recession in the US. Is this the most expected recession, ever?
Recession dissonance and inflation
Walking around Boston, healthcare optimism
Transport enthusiasm trip, a cold-call reach out
UK green power grid report
Silicon Valley Bank: mistakes and a sorrow
Links: how an Iceland town saves pufflings, experiments in govt, new chair needs for climate change committee; environment + health interlinks.
Walking and nosing around Boston, “consumer demand” and “inflation” seems everywhere. Tipping is now up into the 20 to 30% range. Restaurants from the low end pizza to the high end Japanese all seem busy. Companies are putting inflation clauses into contracts. There is inflation in London, but I sense it more pervasively everywhere in Boston.
This dish of dressed raw scallop in a mid scale Boston seafood place was $24 with a 20%+ tip on top. The older couple beside me were having an issue with their order and some trouble gaining the attention of waiters. High tipping is not a guarantee of service. Sitting with my scallops, I reflected that most of the world still live on less than $10 a day. My thoughts drifted to where all these ingredients came from avocado, fish eggs, fresh salad leaves, scallops fresh enough to eat raw. An alchemy of global supply and trade.
There is a global brand shop. Four minutes walk away there is another. Exactly the same. I assume the economics of this must work out but, in this, Boston shopping central mimics other cities. The magical alchemy tilts towards the crazy. How many yoga pants do people need in a 100 metre distance?
Boston casualwear for the middle class: jeans, sweats, hoodies; the indies, goth, tie dye; worker bees, suits, shirts seems unremarkable. A constant flow of people pass. A constant flow of people pass the homeless. The story is familiar. I pass in this flow, my tiny concession being a nod and a smile. Often returned, if only due to some pass human connection.
I am in Boston for a healthcare conference. I believe part of my optimistic outlook is that I have been assessing healthcare for over 20 years now. In that time, I have seen extraordinary advances. Advances that 20 years ago, we might have thought would not happen in a lifetime or ever. Childhood cancers have 80%+ cure rates, if you have HIV you should die of something else if you can get the current treatments.
There is much debate on the wide range of outcomes for the broader economy, but for healthcare at least innovations are steadily (and in some areas in a step change) advancing.
I have to take a short detour to a US Social Security Administration Office. I am attempting to gain an official document that states my social security number (SSN). I was a student at Harvard in 1999 and was given a SSN then. It turns out, you have a number for life. For much admin, all you need to know is the number. Of course, for my purposes, I need official documents. My little paper number card being lost in the multitude of life moves since 1999.
This office is only 10 minutes south of central Boston by bus. The city scape changes in these 10 minutes. Actively looking, the landscape change is dramatic. The type of buildings, the wealth, the people on the street all very different.
Most seats on the bus are taken. No one is white. No one looks wealthy. Most, I’d say maybe all, do not have the middle class dress codes seen earlier although some might like me might be in part-disguise.
The ticket machine is not working. Everyone apart from me seems to understand this. The bus driver has to kindly bark at me:
You are all set.
Three times, rapidly. While I stare dumbly as to what I am meant to do. She is in a hurry.
A wheelchair user boards. The driver is kindly and efficient in strapping his chair in. So are a couple of other passengers. I sense, in part, that some passengers see themselves reflected in this community.
The Social Security Office fits the modern build nondescript bureaucracy mould. A regulation fit, no frills space. Government pronouncements scroll on a screen. A security scanner worthy of an airport. Two security guards. Everyone is masked and expected to be masked.
At this stage, a lunch break for some, there are more security guards than administration staff. Four fifths of the room are not white. I hear Spanish and other languages more than English. Announcements are made in English and Spanish.
No traveller should ever want to spend time in a nation’s bureaucracy. Yet eyes open I glimpsed a slice of the safety net, the hopes and dreams of the every day Americans in a Boston suburb. The view is not what you see on TV.
On the light side of social media, my beloved organises Transport Sparks (which is mostly run by Facebook group) for young autistic transport enthusiasts. I tend to have a bias to action and agency. When I came across a London Transport Museum (LTM) worker (on Twitter) who seemed to be interested in community work, I messaged them and from that exchange has come about a visit for Spark to the LTM depot to record their lived experiences of transport and to see and respond to the Depot archive.
The lesson to me if one needs one. Good things can come from polite random messages. Social media has dark sides and light sides, like most human tools. Let’s do more of the light.
UK and a green power grid.
For climate nerds this whole report from the UK’s climate change committee is worth reading. In sum, a low carbon power grid by 2035 is doable in the UK. This shows how and gives recommendations for executing it. There is no impossible technological hurdle. The challenges are policy, political will, collective action and institution building. Long-standing are the problems with permitting green infrastructure which will need to be overcome.
Short note on the collapse of Silicon Valley Bank (SVB). A financial disaster that is unfolding in real time. The details are covered well in financial press. I would observe two higher level causes which essentially stem from mistaken management judgment, execution and communication; and one sorrow.
WSJ: “The collapse may have been an unforced, self-inflicted error: The bank’s management chose to sell $21 billion of bonds at a $1.8 billion loss, in large part, it appears, because many of those bonds were yielding an average of only 1.79 percent at a time when interest rates had risen drastically and the bank was starting to look like an underperformer relative to its peers. Moody’s was considering downgrading its rating. The bank’s management — with the help of Goldman Sachs, its adviser — chose to raise new equity from the venture capital firm General Atlantic and also to sell a convertible bond to the public.
It isn’t clear if the bond sale or the fund-raising, at least initially, had been made under duress. It was meant to reassure investors. But it had the opposite effect: It so surprised the market that it led the bank’s very smart client base of venture capitalists to direct their portfolio clients to withdraw their deposits en masse.”
(BY: the 1.79% yield looked poor due to FED rising short term interest rate so that in part is an external outside cause).
One is on communication and second is on “capital allocation” basically where they decided to invest the money (capital) they had and when they decided to sell or move that money.
The poor and, or, mistaken comms exacerbated this effect to create an “old fashioned bank run”.
People with money at the bank where worried they would not be able to obtain their money and so asked to withdraw their money, but if everyone asks at the same time then the bank can not immediately deliver all that money and collapses. The irony is that if no one, or few, people ask for their money then the bank survives. The two policies to mitigate this are deposit insurance (but in the US this covers deposits only <$250K and many SVB deposits (>90%) are >250K) and the regulator stepping in.
The regulator has now stepped in and hopefully can find a buyer with significant assets (or some back stop regime) so everyone is made whole. If this is not reached then the US start-up ecosystem is going to be in a deep freeze for quite a while (many months, IMHO), if a buyer is found then it will be be more of a deep chill and for a shorter amount of time (maybe some months).
Therein lies the sorrow. Many start-up businesses relied on the services of SVB and have deposits at SVB. These entrepreneurs will be hit hard through no primary fault of their own. Sympathy vibes to them.
Links:
The interlink of health + environment.
More experiments in government please argues Stian Westlake.
UK CCC needs a new Chair
How a small town saves puffins