Michael goes crypto...

...well, not quite, but he does what he rarely does, he reproduces an entire piece from the NYT (last time he did that it was with a column from Ross Douthat about Obama's victory in the 2012 elections). Enjoy: 

Going for Broke in Cryptoland -- By David Segal

Some hype coins mint instant millionaires. Others go bust. Why not take a chance?

They have names that make them sound delicious, like Cookie Coin. Or headed for outer space, like Pluto Coin. Or space-bound and delicious, like AstroCake, which was described this way: “Created 5 minutes ago. SAFE.”

Hype coins, as they’re known, sit squarely on the flashy, speculative end of the cryptocurrency business. Every day, dozens of them are created around the world by developers promising fortunes to would-be investors. It usually ends poorly. The vast majority of these tokens are worthless within a couple of weeks. The developers, on the other hand, can make tens of thousands of dollars, sometimes a lot more.

Despite this track record, hype coins have become the investment of choice for millions of people, most of them men in their 30s, or younger, and convinced that the economy writ large is rigged against them. Some are the same traders who have been leaping into stocks like GameStop and AMC Entertainment. To them, crypto is both a source of hope (in imminent riches) and fellowship (many coins have chats on Telegram, an encrypted messaging app, that can sound like faith-based support groups).

It’s hard to think of another financial craze in which so many people poured so much into entities with so little intrinsic value. Few hype coins have any utility as currency. Good luck buying lunch with one. Many are minted in numbers rarely seen outside astronomy books — trillions, quadrillions — which dooms them to vanishingly tiny prices.

From the outside, the hype coin party is a mystery. To understand it, you have to join it.

Which is surprisingly easy. You may have heard that Bitcoin, the granddaddy of crypto, is “mined” by power-gobbling supercomputers, a process that verges on the utterly incomprehensible. Making a hype coin, by contrast, is more like ordering a pizza online. The entire process is automated and speedy. The fixings — in this case, what to call it, how many coins to make and so on — are up to you.

So one day in May, I created my own cryptocurrency. I did it on a Zoom call with an excitable 36-year-old in Taiwan, Dan Arreola, who had posted a tutorial on YouTube about how to make, and promote, a “scam coin.” It has more than 240,000 views.

Spread the news

Sorry to disturb you

What does it mean in the age of Donald Trump, "ethically?"

We're interrupting our blogging for an important message

German for beginners

(Hat tip: Sina DunkleWelle)

The translation yes...well, "Kondome" means Condoms, "Barcode" is barcode, "Tattoo" is actually not German, ("Tätowierung"), "Kasse" is checkout, "witzig" is funny, "ich hasse" means I hate...that should do it...

Touché

Fewer people would listen if his name were Adam Smith, but here it is what he has to say, Tyler Brûlé, the well-named editor of the Monocle Magazine and columnist of the Financial Times:

HOW ABOUT SUBSTANCE?

And the occasion? Well, anything could be the occasion, because nothing, nothing has ever ruled the world as much as marketing in all its ugly emanations does these days.

Tyler Brûlé

In Brûlé's case --- not sure he would like us to call him Tyler --- in Brûlé's case it's  --- and now we are interrupted by a chain of events reported under Connubial Bliss  --- in Brûlé's case it's  --- and now we could dwell on the fact that it wasn't so much an event as the absence thereof, like, like Conan Doyle's dog not barking in the night --- in Brûlé's case it's  --- it's perhaps a lucky coincidence that we're not writing a column in the FT but a simple blogpost  ---  in Brûlé's case it's a conversation with a friend who has started writing for this "large-ish news organization," finished her first story, and is now spending her time on getting the message of its publication across via "a media channel" (Facebook, probably). And then he asks:

Who of you is the man? --- Korea (1)

We didn’t have a fight for a few minutes, so it’s not really something for the Connubial Bliss, plus, we’re in Heathrow, changing planes for our trip to JeJu, Korea. South Korea, that is, the place nobody dares to visit since the North is reiterating its prediction that it will throw “small nukes” if feeling annoyed by is ethnic neighbor much longer.

Heathrow airport

Everybody hates Heathrow (queues) but the shopping is supposed to be good, so we have to buy “Polo.” Polo, among other things, is a fragrance created by Ralph Lauren and used by Chang. A spunky duty-free sales-female takes charge first of Chang and then of yours truly as the mammal bond between the two homosexual travelers transpires. We’re apparently adrift in the wrong place and should follow her to the male section and get “something for men.”

(This is a bit overwritten, apologies.)

“We’re kinda girls,” I say ...

Need a job?

(Maud sent this:)

A simple theory of efficient markets

Our starting point is an observation by a Professor Helbing  (not Helsing) in an interview with the FAZ. Here is the English translation:

On the question by the FAZ regarding the "intelligence of crowds" in bees and ants, Professor Helbing replies:

"In humans there is both, 'crowd intelligence,' and 'crowd madness.' We did some experiments recently where we asked subjects to provide estimates of "facts" of which they may not know much themselves (eg. the number of robberies in a given city). If subjects provide estimates independently of each other, the spread is large, but the mean is typically spot on. However, if subjects are being informed about the estimates of other subjects, they begin to rely on each others estimates. In the end, they agree, but the agreed-up value is often completely off the mark." (This phenomenon is know as groupthink in the Anglosaxon literature.)

Back to markets now. If we can generalize Helbing's results, markets participants will, on average, come up with prices that do reflect the underlying values efficiently, provided they are not relying on each other.

However, in reality, market participants do rely on each other to varying degrees---more in stress situations, less in calmer markets. This is crucial. In a crisis, market participants lose their bearings, group think takes over, and the resulting prices go off the charts. Market efficiency is lost. Eventually, the panic subsides, and relative efficiency is restored.

Our approach (others may have already said this more clearly, I don't know) eats the cake, and has it, too: In the long run, on average, markets are relatively efficient, but in crises they need not be. We use the semantics of "panic" to explain a behavior, which, via group think, and Helbing's results (I guess there are similar results out there from other workers) directly leads to inefficient prices.

George Soros, with his notion of reflexivity, may actually mean the same thing.