The Website Obesity Crisis Maciej Cegłowski calls for downsizing web pages. And "I shouldn't need sled dogs and pemmican to navigate your visual design." (previously)
The Slow Demise of a Unicorn Everybody knows how the first tech boom went bust. But this time around, something's different. More than 100 tech start-ups are currently valued at more than $1 billion dollars, if you go by what VCs and other early investors have paid to buy ownership stakes. Unlike in the early 2000s, very few of today's unicorns have gone public, so there's no way to know what the market really thinks they're worth. Lately though, it seems like the hype train may be coming of the rails. So what happens to those companies now? The New York Times profiles Living Social to find out.
The lost city of Ordos The Kangbashi district, planned to accommodate a population in excess of one million, is home to a lonely 20,000 people – leaving 98% of this 355-square kilometre site either under construction or abandoned altogether.
"The biggest marketing pushes were calling them a huggable investment and attracting people who just thought they were gorgeous little lawn ornaments." [more inside]
There is another bubble. Before it's burned, Coal, Oil and Gas sit for years on the balance sheets of private (and national) resource companies, as "known reserve" assets. Assets that, someday, will become revenues. Or will they? And if they won't, what will the balance sheets of ExxonMobil, Chevron, BP, Petrochina, and Gazprom actually look like? [more inside]
Bitcoin is crashing. After reaching a peak of approximately $1150 USD per BTC yesterday, a panic selloff is happening now. The price has dropped below 800USD, a loss of over 30%, and may be lower by the time you read this. Or it could recover and go higher. You can watch realtime charts of the bubble bursting at The Genesis Block and other BTC tracking sites. The panic began when the government of China has banned banks from using Bitcoins. China is the largest Bitcoin market and restrictions have a significant and unpredictable impact. Bitcoin panic selloffs have occurred before, but the price has recovered and increased nearly tenfold. [more inside]
U.S. District Court Judge Jed Rakoff on "Why Have No High Level Executives Been Prosecuted In Connection With The Financial Crisis?" Judge Rakoff, a federal trial judge who sits in the Southern District of New York, writes: "[M]y point is that the Department of Justice has never taken the position that all the top executives involved in the events leading up to the financial crisis were innocent, but rather has offered one or another excuse for not criminally prosecuting them – excuses that, on inspection, appear unconvincing."
"Railway Mania was an economic bubble in the United Kingdom in the 1840s that involved a railroad development frenzy and a speculative bubble in the shares of railroad companies. ... [T]he British Railway Mania was the result of overexuberance toward the business prospects of a disruptive innovation; though railroads are now a part of everyday life, they were once every bit as revolutionary as the internet was when it was first introduced."
It's the splashing, not the popping. What if American student debt is just too profitable and secure to admit any systemic reform? An interesting and gloomy argument against the higher education bubble theory. [more inside]
Kevin Roose of Nymag.com posted about a brand new North Carolinian hedge fund that seemed less than impressive. The fund then started to use a sarcastic quote from Kevin's post as a kind of ringing endorsement on their website. Uh oh.
The Incentive Bubble (ungated pdf) - "The fraying of the compact of American capitalism by rising income inequality and repeated governance crises is disturbing. But misallocations of financial, real, and human capital arising from the financial-incentive bubble are much more worrisome to those concerned with the competitiveness of the American economy." [more inside]
Charles Murray, author of the controversial 1994 work The Bell Curve, has a new book coming out, entitled Coming Apart: The State of White America, 1960–2010. He's included a twenty-five question, weighted quiz to get a feel for how in touch you are with mainstream, blue-collar American culture. It's not automated, so you'll need pen and paper. [more inside]
What can you do in 15 days? In China, they can build a 30-storey skyscraper.. Can't wait that long? Ok, a 15-storey hotel in 6 days then. "If China's economic development continues on its current trajectory, it could build a new Chicago every year until 2030 more than 1,500 new buildings that are over 30 stories high according to a [McKinsey] report.". For some analysts this is terrible news.
There is this perception that the only China skeptics are foreigners. Let me tell you that is completely wrong. The debate within China is much more interesting and much more ferocious than the debate outside of China about problems with the growth model. Michael Pettis is a professor at Peking University's Guanghua School of Management, where he specializes in Chinese financial markets. Here he talks about China's economic prospects.
Realtors in Cars is one of the strangest sites I've seen in some time. I have no idea how these agencies got their realtors wedged into their cars, or why.
The housing bubble was the last chance most middle-class families saw for grasping the brass ring. Working hard didn’t pay off. Investing in the stock market was a sucker’s bet. But the housing bubble allowed middle-class families to dream again and more importantly to keep spending as if they were getting a big fat raise every year. - How the Bubble Destroyed the Middle Class
Peter Thiel, co-founded PayPal and an early investor in Facebook, is granting $100,000 fellowships to not go to college, at least for a while. "We decided about 5 or 6 months ago to start up a program to try to identify 20 talented entrepreneurs, and give them a two year stipend to drop out of school, and to pursue their life's passions and see where that would go." The 20 Under 20 became 24 young people, the first group that the Thiel Foundation might save from the higher education bubble.
The Higher Education (Debt) Bubble - "[H]igh and increasing college costs mean students need to take out more loans, more loans mean more securities lenders can package and sell, more selling means lenders can offer more loans with the capital they raise, which means colleges can continue to raise costs. The result is over $800 billion in outstanding student debt, over 30 percent of it securitized, and the federal government directly or indirectly on the hook for almost all of it. If this sounds familiar, it probably should... [more inside]
Earlier this week, Toxie, NPR's cutest toxic asset died. One of the mortgages bundled into this asset was an investment property in Bradenton, Florida, which, like many Florida homes, has never been occupied or served as anything other than a financial instrument. Boston.com's Big Picture recently took a look from above at the effects that this (and previous) housing bubbles have had on the development of Florida's cities and landscapes. How do you design a city that nobody plans to live in? (Previously)
Iceland blocks repayment deal, sparks global outrage. "The Icelandic people are effectively saying that Iceland does not want to be part of the international financial system," Britain's Financial Services Minister Paul Myners said. But the bill equates to £40,000 per family. Britain threatens to freeze Iceland out of EU as loan payback vetoed. [more inside]
Reprocess of Bubble Nebula Data. NGC 7635, also called the Bubble Nebula, is an emission nebula in the constellation Cassiopeia. It's created by stellar winds from a superhot star 40 times the size of our sun which whip the cloud of gas around the star into a bubble. [Via]
"The world's most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money." [more inside]
Finally, finally - Zubbles are available for pre-order! Inventor Tim Kehoe has been searching for the elusive colored bubble for a long time. Through his experimentation he's stained his eyes a deep blue, along with his car, his kitchen, and his bathtub (he's also permanently stained the family dog). But in 2005, after 11 years and over $500,000 in funding, Kehoe successfully created a colored bubble that wouldn't stain. His invention, Zubbles, was given the "Best of What's New, Grand Award" from Popular Science. [more inside]
How Lehman Brothers Got Its Real Estate Fix. A great article in the NYTimes describes some of the details of commercial real estate lending in its heyday, with a focus on one of Lehman's biggest dealmakers.
Dolphins at SeaWorld Orlando make and play with bubble rings. Others learn by watching. (SLYP) via [more inside]
Leaving office, President Bush claimed "that he took 'a deliberate and comprehensive approach' to preventing terrorism that combined military action overseas with strong defensive measures at home."
[As early as 2002] "We knew that the mortgage-brokerage industry was corrupt... Where we would have gotten a sense of what was really going on was the point where the mortgage was sold knowing that it was a piece of dung and it would be turned into a security. But the agents with the expertise had been diverted to counterterrorism."
[. . . . FBI Director Robert] "Mueller actually circumvented the Justice Department and the OMB to get resources. But he was shut down" by the [Bush A]dministration. [. . . . Testifying in October 2004, ] Chris Swecker, then assistant director of the criminal investigation division said ... "The potential impact of mortgage fraud on financial institutions in the stock market is clear. If fraudulent practices become systemic within the mortgage industry and mortgage fraud is allowed to become unrestrained, it will ultimately place financial institutions at risk and have adverse effects on the stock market."
Sunday Afternoon Flash Fun/Metafilter Convalescence Flash Fun: BubbleQuod. You have lived your entire life in a bubble. Now you want out. Burst your bubble.
Ladies And Gentlemen… Dow 25,000! A few years ago, some financial wizards thought the good times would go on and on and on. The mega-market could bring Dow 30,000 or Dow 36,000. Maybe the real estate boom will not bust.
History Repeats Itself in Different Hues -- a readable Q&A data dump comparing the economics and policy responses of 1990s Japan and current events
Bill Moyers interviews George Soros on the financial crisis. Soros discusses market fundamentalism and the causes of the current crisis, as well as what can be done, and how this meltdown will change the global economy. (via The Big Picture) [more inside]
There are still some smart people left on Wall St. Hedge fund manager, John Paulson, made a cool $15B for his fund as the housing market imploded. His cut? $3-4B. Not too shabby for a year's worth of work. [more inside]
The Next Bubble: Priming the markets for tomorrow's big crash. A layman's primer on the genesis and future of today's economic troubles, at Harper's Magazine.
The Subprime Primer. [via] An entertaining, lo-fi, comic-book style explanation of the complex Subprime Mortgage mess.
"Here Comes Another Bubble" a very 2.0-savvy song parody with a 'catch all the in-jokes' video. [more inside]
Remember the Town Disney Built? -- 50% of the homes in Celebration, Florida are up for sale. A failure of corporate-owned and -planned Community™? or just a fallout of the bursting of the housing bubble? And whither New Urbanism? [more inside]
Minsky Meltdown ahead? Named after Hyman Minsky, an economist who was known for his research concerning financial crises, specifically asset bubbles based on credit cycles. [much more inside]
Countrywide Empties Out on Widowmaker gives a vivid idea of the turmoil in the mortgage market, and the difficult American real estate environment. "You sold your unlimited subway card after the 5th race, plunged full-bore on a filthy hot dog, a beer and a 9-1 shot that finished next-to-last. You are Countrywide."