The Bear’s Lair: Depressed billionaires are good news

“It’s a depressing environment” said billionaire investor Stanley Druckenmiller to MarketWatch, explaining that he is investing in Treasury bonds in the hope that short-term interest rates will descend to zero again. At first sight, that should be bad news for the rest of us. But when you examine the different financial universe in which billionaires live, you come to realize that Druckenmiller’s gloom may be a healthy sign – provided the Fed doesn’t follow his policy recommendations. Continue reading

The Bear’s Lair: Reorganizing British politics

Britain’s Euro-elections on May 23 resulted in the 6-week-old Brexit Party getting 32% of the British vote and 29 MEPs, becoming the (equal) largest single MEP bloc in the European Parliament. With Theresa May’s resignation the following day, it opened a clear route for a full exit from the European Union and a new and better British politics. To get there and avoid falling into the numerous traps the left and the media will set, Brexiters need to understand how the British electoral system works and examine the precedents of 1886 and 1918. Continue reading

The Bear’s Lair: Could China take a “Middle Kingdom” approach?

“Our Celestial Empire possesses all things in prolific abundance and lacks no product within its own borders” wrote the Qianlong Emperor to George III through Lord Macartney in 1793. That turned out not to be true for Qianlong and his immediate successors, and China’s history over the next two centuries was an unhappy one. But now that China has trained infinite numbers of its best and brightest in Western colleges, and transferred the best Western technology licitly or illicitly to itself, could the Qianlong approach work today? Continue reading

The Bear’s Lair: What will be the hot IPOs of 2029?

Investment bankers are very slow learners. That’s the only lesson that can be drawn from the catastrophic failure of the Uber Inc (NYSE:UBER) initial public offering. As this column has been writing for years, it was perfectly obvious that a loss-making taxi service with software attached was never going to be worth $100 billion. Frankly, despite all the cheap money thrown at venture capital, the IPOs in this cycle (which I take to be more or less over) have been very dull indeed. Will we get something more interesting next time around? Continue reading

The Bear’s Lair: The flat world that never happened

Thomas Friedman’s 2005 “The World is Flat” postulated a world growing ever closer together, with diminishing barriers both trade and political and a gradual move towards at least elements of world government. With all due respect to Mr. Friedman, this never happened, and does not appear likely to. The questions that arise are: Why not? and Where are we going instead? Continue reading

The Bear’s Lair: Will we get smarter about global warming?

Philipp Blom’s “Nature’s Mutiny” (Liveright, 2019) looks at the Little Ice Age of 1560-1700 and demonstrates that, whereas the first generation afflicted by unexpected cold weather sat around moaning about God not loving them, after about 40 years more intelligent responses occurred, such as improvements in agriculture, a massive growth in international trade and the birth of modern capitalism. Since it is nearly 40 years since the world started worrying about global warming, can we hope for an equivalent improvement in response IQ? Continue reading

The Bear’s Lair: Presidents should delegate bad news

President Trump is said to demand a folder of favorable news clippings every morning, and to refuse to deal with bad news, delegating it to staff. This runs contrary to the “buck stops here” ethos of the American Presidency, and to management textbooks which demand that the CEO be informed of all problems. Yet the Oval Office is a uniquely stressful environment, that wears down most occupants, making them ineffective in their second term. Maybe, as in many areas, Trump has found a better way. Continue reading

The Bear’s Lair: The Brexit War is entering its Western Front phase

As this column forecast four weeks ago, Treason in the Brexit process prospered, and Brexit has been postponed to October 31. Businesses groaned, as the uncertainty prolonged itself to an unendurable length. Most likely, Brexit will now either be abandoned or diluted to a degree where Britain does not break free of the EU’s regulatory straitjacket. However, the battle is not yet over, so I thought it sensible to use this Easter respite to offer some thoughts on how to maximize the chance of a genuine return to a free Britain. Continue reading

The Bear’s Lair: The reforms billionaires won’t bring you

Ray Dalio, self-made CEO of the Bridgewater hedge fund group, the largest such operation in the country, says capitalism is broken. His solution, unsurprisingly, is a mix of higher taxes and more public spending – just the mix that will pull up the drawbridge up behind him and prevent younger people replicating his success. From Warren Buffett through Mark Zuckerberg down, there is a sameness to all the billionaires’ prescriptions. This column will explain why and suggest a few reforms billionaires won’t tell you about. Continue reading

The Bear’s Lair: The dark side of Tech

We are accustomed to thinking of the tech sector as a beacon of hope, leading us to a bright gadget-filled future, in which everybody’s lives will be richer. Yet evidence is mounting that the reverse is in many cases happening. Fueled by immense amounts of private equity money, tech companies are reinventing established businesses – to turn them into exploitative sweatshops that circumvent regulations, degrade quality and oppress their employees. Continue reading