The Bear’s Lair

The Bear’s Lair: Unicorn is a sub-species of Dinosaur

The failure of the WeWork IPO and the poor post-issue performance of Uber and Lyft have called into question the current Silicon Valley fashion for multi-billion-dollar capitalizations of “Unicorns” that make heavy losses and remain privately owned. Maybe throwing endless pools of money at unproven intellectually shaky concepts doesn’t work. When Unicorns go the way […]

The Bear’s Lair: The blessed world of low asset prices

After a decade of ultra-low interest rates, we have become used to ultra-high asset prices – in big city real estate, stocks, bonds, tech start-ups, art and collectibles, and pretty well everything else you can think of. It is too depressing to think of the damage that will be done by the inevitable bursting of […]

The Bear’s Lair: On October 15, Britain stops being a democracy

By a vote of 298 to 56 on September 4 and a second similar vote on September 9, the House of Commons voted to approve an election on October 15, yet because of a supermajority provision unknown to the British constitution, Parliament was not dissolved. A Parliament you cannot dissolve is no longer a democratic […]

The Bear’s Lair: Solve funny money problems with a leverage tax

We seem doomed to another round of monetary “stimulus” from the Fed and the European Central Bank, at a time when real interest rates are already substantially negative. This has caused crazy leverage all over the global economy, with such madness as Boeing (NYSE:BA) in a highly cyclical business, operating entirely without stockholders’ equity. Very […]

The Bear’s Lair: EU structure leads to one-party dictatorship

Former prime ministers Tony Blair and John Major, of opposite British political parties, have united in wishing to nullify the 2016 referendum on leaving the European Union. This well illustrates the unpleasant tendency for politicians to find commonality and unity in thwarting the wishes of their electorates. Within individual countries, the strength of this tendency […]

The Bear’s Lair: Could Trump have stopped the Third Reich?

President Donald Trump has instituted an entirely new type of diplomacy with North Korean dictator Kim Jong-il, and it seems to have worked, at least in the short-term. By building a personal relationship with “bad guys” Trump has avoided the poisonous Bush-era chemistry whereby Western “Axis of Evil” insults drove them ever further into destructive […]

The Bear’s Lair: Business Roundtable amputates the Invisible Hand

The Business Roundtable last week produced a 400-page publication claiming that its members should no longer look first to profitability but should follow the interests of stakeholders as a whole, including employees and the environment. This is pabulum we are used to from the titans of Big Business, who are no longer truly capitalist in […]

The Bear’s Lair: Public charge principle could usefully operate globally

The Trump administration last week announced a substantial tightening of the “public charge” rules by which immigrants drawing welfare would be ineligible for permanent resident “green card” status. As Milton Friedman said: “It is just obvious you can’t have free immigration and a welfare state,” so this is good policy. However, it made me wonder: […]

The Bear’s Lair: Global Gosplans should be shut down

Kristalina Georgieva’s nomination as Managing Director of the International Monetary Fund is entirely appropriate. She is a Bulgarian communist by background, for 14 years until 1993 a Professor at the Karl Marx Higher Institute of Economics under that country’s communist government. The IMF itself and its sister institution the World Bank have since their foundation […]

The Bear’s Lair: The global tax regime becomes ancien

Modern “big data” systems are allowing tax authorities to gain full knowledge of sales transactions in their jurisdiction, thus pushing VAT tax collection rates close to 100% on small businessmen and the middle class in general. Meanwhile, Western income tax systems collect steadily less tax from large corporations and the very rich, who use loopholes […]