Thursday, November 30, 2017

Stalking Bloomberg: "Money.net now has more than 80,000 subscribers"

This is a bit surprising. One of Bloomberg's "moats" are the network effects from having as many terminals out on lease as they do, but now it appears that moat might be crossable. See Metcalfe's Law. More after the jump.

From the New Ydork Post:
Money.net, an online platform for financial data and news, says it has grown its ranks of subscribers to more than a quarter the size of industry behemoth Bloomberg’s.

The company, which charges as little as $1,500 a year for a subscription, now has more than 83,000 registered users, according to CEO Morgan Downey, who hasn’t previously disclosed the figures.

Meanwhile, subscriber numbers for Bloomberg, which charges as much as $24,000 a year, fell about 1 percent last year to 324,485, according to a March report from Burton-Taylor International.

“Our goal is to leapfrog Bloomberg,” Downey, who was a Bloomberg exec until 2014, told The Post in an interview.

The revelation comes as Money.net releases an updated platform to users that integrates Dataminr, a tool that integrates real-time data from social platforms like Twitter, and Symphony, a Wall Street-owned chat application that has challenged Bloomberg’s integrated chat feature.

The company, which also has former Bloomberg exec Norm Pearlstein on its board, is also folding in Scout Finance, a mobile financial platform it acquired last month, and which the company plans on rebranding as Money.net soon, Downey said.

Downey hasn’t been shy about attacking Bloomberg for its technology, even if his platform lets users mimic the terminal’s orange text on a black background.

“It’s your grandfather’s trading tool,” Downey said.

The financial data giant, which is run by Michael Bloomberg, saw two straight years of terminal sales losses last year, the Barton-Taylor report said....MORE
HT: TalkingBizNews

Previously:
Oct. 24, 2016 
Money.net Hires Former Bloomberg Honcho to Take On Bloomberg Terminals With Machine-Generated News Bulletins and Stories
July 18, 2017 
"Can Anyone Bury Bloomberg?"
...Bloomberg provides one-stop shopping for data, analytics, news, and trading. Bruce Falbaum, who invests in high-yield bonds and leveraged loans as a senior portfolio manager and principal at $1.6 billion Cohanzick Management in Pleasantville, New York, has used Bloomberg for 20 years. He’s not looking to make a change now.

“For the things it does, I don’t find anything that really compares — though, honestly, I haven’t looked,” Falbaum says. Market makers post high-yield bond prices and send traditional communications to customers like him over Bloomberg’s messaging system. “I see the entire market going on in front of me on Bloomberg. I’m not aware of any other place where I can do that.” Cohanzick has six Bloomberg terminals and would love to trim the expense. “That’s real money for a firm like ours,” Falbaum says. But a replacement would have to include the same capabilities he and his colleagues enjoy on Bloomberg.

And just as important, the other players in his market would have to adopt the new service as well, so he could continue to communicate with them. “We have relationships with about 100 broker-dealers,” Falbaum says. “I can use a scraping function to see their quotes that are contained in messages, and then I can contact them to potentially do a trade. That’s all on Bloomberg.” It would be very difficult for a competitor to gain a critical mass of users, he says....
Possibly also of interest:
August 2014 
A Deep Dive Into Goldman's Chat Platform (GS)

August 2014 
"Can the Bloomberg Terminal be “Toppled”?"
...And now Mr. Turck (*"Partner at FirstMark Capital. Previously, Managing Director at Bloomberg Ventures and before that, co-founder of TripleHop Technologies, acquired by Oracle....")

"There’s a new subscription business model arriving for cars"

From Quartz:
After houses, cars are among the most expensive purchases people make. A number of carmakers and retailers are trying to make it one of the least by turning car ownership into a subscription.
Volvo is the latest to join Ford, Cadillac, and Porsche to offer a a monthly subscription car service.

On Nov. 29 at the LA Auto Show, Volvo announced a XC40 crossover SUV that can be had for $600 a month, reports Endgadget. The monthly fee under the “Care by Volvo” program includes the car, maintenance, insurance, and concierge service with no commitment to renew beyond 30 days. Compared to a lease, subscription services tend to be much shorter in duration (days or weeks), offer the ability to swap out cars as well as extra services and less stringent credit requirements. Most are also turning to the smartphone, rather than then dealership as the way to close the deal.

Car subscriptions differ from buying or leasing, BMW’s Atif Rafiq told Engadget, because a subscription “solves for a bunch of wider things than actually owning a car. It’s not just getting the car, it’s maintaining it, it’s paying for additional things it needs like insurance.”

Car sharing service Car2Go lets you rent cars by the day, hour, or minute in many North American cities. The startup Fair is letting customers shop, get approved, and pay for a car on their smartphone with a monthly contract that’s less expensive than a lease. Fair says it uses driver’s license, bank account, and credit information to identify the right-priced car, and includes a limited warranty, routine maintenance, and roadside assistance. Customers can return cars on just five days’ notice.
“Fair hopes to accomplish for the auto industry what iTunes and Netflix did in their spaces,” wrote the company by email. “We want to give our customers access to the exact thing they want right on their phone, and when they don’t want to use it anymore – or can’t due to a [military] deployment, job loss or other unforeseen change in their circumstances – they simply turn it in.”...
...MORE

See also Izabella d'Alphaville, Nov. 24 "Your car as a data harvesting machine"

And the next day I got close to the rental-period timeframe:
From those wonderful folks who bring us Davos, Existence as a Service!
Yes you can now purchase your existence for periods as short as one hour using WEFcoin and  the EaaS platform...
in "World Economic Forum: 'Welcome to 2030. I Own Nothing, Have No Privacy, and Life Has Never Been Better'", but didn't get down to rental by the minute.

Today In RINS: "U.S. EPA ups biofuel targets slightly, draws scorn from refiners"

From Reuters:
The U.S. Environmental Protection Agency said on Thursday it will require fuel companies to blend slightly more biofuels into the nation’s gasoline and diesel next year, angering oil refiners who view them as a competitive threat.

The announcement follows weeks of lobbying by Midwestern lawmakers and representatives of the corn industry who wanted the agency to reject recent proposals from the oil industry to water down the U.S. biofuels mandates. 

“Maintaining the renewable fuel standard at current levels ensures stability in the marketplace and follows through with my commitment to ... upholding the rule of law,” EPA Administrator Scott Pruitt said in a news release. 

Pruitt is expected to travel to an invitation-only event in Iowa on Friday and highlight the administration’s commitment to the ethanol industry. 

The U.S. Renewable Fuels Standard requires refiners to blend increasing amounts of biofuels into the nation’s fuel supply every year as a way to boost U.S. agriculture, slash energy imports and cut emissions. 

The law, introduced more than a decade ago by then-President George W. Bush, has been a boon to the corn belt but has upset the oil industry, which sees biofuels as competition and which has been burdened with the costly responsibility of blending. 

The 2018 targets require fuel companies to blend 19.29 billion gallons (73.02 billion liters) of renewable fuels into the nation’s fuel supply, up slightly from the 19.28 billion gallons required for 2017....MUCH MORE
Corn is up two pennies per bushel. Ethanol up 63 cents per hogshead and that's about it for old-timey measurements. Wait...mileage!

The Simpsons on Biofuels, Politics and P.R. Spin
Marge: Now, I know you haven't liked some of my past suggestions, like switching to the metric system --
Abe:
[stammers a little] The metric system is the tool of the devil!
My car gets forty rods to the hogshead and that's the way I likes it.

[hogshead: n 1: a British unit of capacity for alcoholic beverages]

"Revealed: Qatar in new quagmire as an unlikely natural resource runs out"

From al-Arabiya:

Matt Levine on Valuing Bitcoin

From Bloomberg View:

Bitcoin Frenzy and Trendy Computers
Also drug charities, OLA and stock buybacks.
Bitcoin 10,000! 11,000! 10,000! 9,000! 10,000! Whatever!
How do you value a bitcoin? I think you can reasonably put a range around the value:
  • On the downside, if people decide to stop using bitcoin as a means of exchange or a store of value or a speculative instrument, then its value will be zero. There is no scrap value for a bitcoin. 
  • On the upside, if bitcoin becomes the sole currency for all transactions in the world, you could take Dan Davies's back-of-the-envelope valuation methodology from 2014, plug in a gross world product of about $100 trillion, and get a value per bitcoin of about $500,000. (Here is a talk from Mike Novogratz along related lines.) But that methodology treats bitcoin as just base currency; if you assume that it also replaces all financial assets then you should probably scale that number up by an order of magnitude or so. 
So let's say that in the most pessimistic scenario a bitcoin will be worth $0, and in the most optimistic scenario it will be worth $5 million. So! Great! Now all we have to do is to figure out the likelihood that everyone decides bitcoin is a fraud and stops using it, and the likelihood that bitcoin becomes the sole means of exchange and sole store of value, and the distribution of possibilities in between, where it fills some smaller or larger niche with some smaller or larger value.

I suppose that that is a hard and interesting intellectual problem, though more hard than interesting. Certainly no one seems to be answering it in any particularly rigorous way, nor do I think it is obvious that you even could. ("Macro guys are generally intuitive," says Novogratz; "they’re trying to play the futures, they’re trying to make bets on less information than the normal investors are.") The main question is: In one or five or 50 years, will everyone on earth want to use bitcoin, or a lot of people, or a few people, or nobody? There are no fundamentals, no cash flows or price-earnings ratios, to evaluate. It is pure speculation about speculation, a Keynesian beauty contest where all the pictures are blank.....MORE, so much more
BTC  $9,401.30

"Winners And Losers In The Patent Wars Between Amazon, Google, Facebook, Apple, and Microsoft"

From CB Insights: 
Google leads the pack in applying for AI patents, and Microsoft is the most prolific in filing for patents, but the race is on in AR/VR, cybersecurity, autonomous vehicles, and more.

It’s no exaggeration to say these five companies are racing to own the future.
Amazon, Google, Facebook, Apple, and Microsoft are not just the most valuable companies in technology. They’re also driving innovation that will have massive impacts on business and society. Trends like autonomous vehicles and AI are still in their infancy and have the potential transform our lives.

But how deeply is each company involved in pushing the boundaries in these areas? Where can we go to learn what tech they’re prioritizing and where the next bleeding-edge innovations will come from?

Patents are a meaningful leading indicator of where company R&D and innovation efforts are headed. True, an individual patent might only be a sketch of a potential product. But taken together, activity across hundreds of patents can reveal strategic direction and priorities.

Using CB Insights’ patent search engine, we mined the patent application activity of tech’s Big 5 over the past 9 years. Here’s a bit of what we found:

Artificial intelligence: Google has the most AI patent applications to date and Apple lags behind its rivals.

Autonomous vehicles: The race to develop software and sensors that underpin self-driving cars is also led by Google, but surprisingly the race toward autonomy in cars and drones is tightening.

Cybersecurity: Cyber is increasingly a C-suite issue and the Big 5 are all ramping up efforts to secure users and prevent abuse.

AR/VR: Despite limited overall patent activity in AR/VR, Apple is pushing hard on mobile AR and leading that space with ARKit.

Healthcare: One company in particular has pushed ahead in this area and it is not Google.

Highlights from our analysis include:
  1. Google has the widest-range of bleeding-edge patent priorities
  2. Teaching computers to learn with AI
  3. The race to build the “brains” for self-driving cars and autonomous drones
  4. Preventing fraud and abuse is now critical
  5. Designing an augmented future for increased productivity
  6. The battle for the future of healthcare
  7. Big 5 individual innovation priorities by keyword significance

Google has the widest range of bleeding-edge patent priorities

The table below gives a high-level overview of where Amazon, Google, Facebook, Apple, and Microsoft are most focused on patenting bleeding-edge technologies across a variety of business opportunities.
https://s3.amazonaws.com/cbi-research-portal-uploads/2017/11/16133918/FINAL-SUMMARY-PATENTS-TABLE.png
...MUCH MORE

"'I.C.O.s represent the most pervasive, open and notorious violation of federal securities laws since the Code of Hammurabi,” Mr. Grundfest said in an interview.'"

Former S.E.C. commissioner Joseph Grundfest, New York Times, "Initial Coin Offerings Horrify a Former S.E.C. Regulator"

I misread the line as the Code of Harambe.
**********
I am apparently 18 months behind in my memes. It seems like it was just yesterday.

So, I have to ask, "Is this guy still a meme?"

Art: "Why Do Asian Collectors Buy Impressionists? Because You Can Sell Them When You Have To"

From Art Market Monitor:
The New York Times profiles the founder of Jakarta’s Museum Macan which is built upon Haryanto Adikoesoemo’s personal collection but with the state of the art facilities that will allow it to borrow from any museum in the world. Adikoesoemo typifies the new collectors emerging in Asia in that his tastes and interest in art are not bound by his national culture or regional identity.

Adikoesoemo collects Kusama and Koons, Basquiat and Affandi but his first encounter with buying art was more oriented toward European masters which turned out to be a very sound way to store some of the value generated by his family chemicals business.

During the 1997 Asian currency crisis, Indonesia was hit very hard. Adikoesoemo had levered up the family business to expand leaving them exposed to a downturn.
“I needed money, so I had to sell all of my Impressionists,” he said with a smile. “The crisis was very tough.” […]
...MORE

Media: "Shares in Daily Mail owner sink on gloomy 2018 guidance"

From City AM:
The Daily Mail's publisher's share price tumbled as much as 25 per cent today as it reported a steep decline in full-year profits.

The figures
In the year to the end of September, Daily Mail & General Trust (DMGT) reported a 13 per cent drop in profit before tax to £226m. Shares in the company were down 23.72 per cent at 535.5p at the time of writing.

Revenue stood at £1.7bn, up one per cent on an underlying basis.
The company booked impairment charges of £206m against some of its investments, including Genscape, Xceligent and SiteCompli. 

Why it's interesting
While DMGT's popular Mail Online moved into profitability, analysts at Liberum said they were concerned about, among other things, DMGT's guidance for 2018.

The company said its short-term earnings would be adversely affected by recent disposals and challenging conditions in some sectors.

It said the underlying rate of decline in its media business was expected to be in the mid-single digits in the next financial year, with the operating margin dropping to about 10 per cent from 11 per cent in the previous year....MORE
The Real Deal notes:

Daily Mail writes down Xceligent’s value to zero amid “disappointing” NYC expansion
Daily Mail and General Trust wrote down the carrying value of its real estate data subsidiary Xceligent to zero amid lower-than-expected profits from a push into New York City, the company said Thursday morning....MORE

"The State of European Tech 2017: Record funding and an intensifying battle for talent"

From TechEU:
Europe is on track to end 2017 with a record $19 billion worth of tech investments, according to a report from VC firm Atomico, meanwhile the European tech industry is in the midst of a ‘Battle Royale’ for talent that is showing no signs of slowing down.

The State of European Tech 2017 was published this week at the Slush conference in Helsinki. It has collated data from surveys, Dealroom.co, LinkedIn, Stack Overflow, EIF, and several other sources to provide a comprehensive guide to the health of the European tech industry, from investment to regulation and talent shortages to gender diversity.

Record year for funding
In 2017, $19 billion was invested in European tech companies, up from $14.4 billion in 2016. Data for the remaining weeks of the year is based on projections. There were more than 50 funding deals that crossed the $50 million line, including The Netherlands’ Picnic, which secured $110 million and Spain’s Cabify taking in $100 million. There are now 41 tech companies in Europe that are valued at more than a billion dollars, such as Angry Birds maker Rovio (which went public this year) and Slovenian gaming company Outfit7, which was acquired for $1.1 billion.

The UK is still the biggest recipient of VC funding, taking in $5.4 billion in 2017 ($2.5 billion for Germany and $2.1 billion in France). However, there were more deals closed in France this year than in the UK.

Deep tech, in particular, has caught people’s attention. Investors have pumped $3.5 billion into the field – robotics, AI, blockchain, autonomous vehicles – in 2017 (up 40% from last year). Examples include Improbable raising more than $500 million from Softbank.

More than $3 billion has been invested in Europe per quarter for 11 consecutive quarters with fintech being one of the biggest verticals that VCs are putting cash into. There was however a decline in the number of deals below $2 million.
http://tech.eu/wp-content/uploads/2017/11/quarterly-funding.png
The median Series A round is now $5.5 million, up from $3.3 million five years ago. The competitive landscape among VCs in Europe has pushed this average up.

There’s more cross-border investment activity with 33% of investments made by European VCs going into companies in other countries. The big four cities of London, Berlin, Paris, and Stockholm still dominate but there has been a steady growth in the capital invested in so-called second tier cities like Amsterdam, Munich, Oslo, and Barcelona.

In terms of investment per capita, Europe is still far behind Israel and the US but there’s also been an increase in the number of Asian investors putting money into Europe....MUCH MORE

Court Orders Coinbase to Report 14,355 Users to the IRS

A couple weeks ago ZeroHedge noted "The IRS Is Puzzled: Why Out Of 500,000 Coinbase Users, Only 900 Reported Gains Or Losses".
It appears their puzzlement is soon to be relieved.

And for spectators in the cheap seats, the judge in this case is Magistrate Judge  Jacqueline Scott Corley who has also been helping Judge Alsup in the Uber-Waymo case.

From The Verge:

Anyone moving more than $20,000 on the platform is subject to the new order
Today, Coinbase suffered a major defeat at the hands of the Internal Revenue Service, nearly a year after the case was initially filed. A California federal court has ordered Coinbase to turn over identifying records for all users who have bought, sold, sent, or received more than $20,000 through their accounts in a single year between 2013 and 2015. Coinbase estimates that 14,355 users meet the government’s requirements. The full order is embedded below.

For each account, the company has been asked to provide the IRS with the user’s name, birth date, address, and taxpayer ID, along with records of all account activity and any associated account statements. The result is both a definitive link to the user’s identity and a comprehensive record of everything they’ve done with their Coinbase account, including other accounts to which they’ve sent money.

The order is significantly narrower than the IRS’s initial request, which asked for records on every single Coinbase user over the same period. That request would also have required all communications between Coinbase and the user, a measure the judge ultimately found unnecessarily comprehensive.
The government made no claim of suspicion against individual users, but instead argued that the order was justified based on the discrepancy between Coinbase users and US citizens reporting Bitcoin gains to the IRS. Coinbase boasts nearly 6 million customers, but according to a government filing, fewer than 1,000 US citizens have reported cryptocurrency holdings on their taxes....
...MORE, including the Judge's order.

Previously:
Nov. 11, 2917
Nov. 22, 2016 
Bitcoin: Andreessen Horowitz Backed Coinbase Has An IRS Problem

Wednesday, November 29, 2017

"Enough Of This Half-Assed ‘Futures’ Nonsense, Which Of You Banks Is Gonna Trade Actual Bitcoins?"

From DealBreaker:
As if timed for the momentous occasion of bitcoin topping $10,000, news broke Wednesday that Wall Street eminences Cantor Fitzgerald and Nasdaq Inc. will soon follow the lead of their Chicago peers CME and CBOE and offer bitcoin futures trading on their exchanges. Though not terribly surprising, the development represents the next logical step in the progression of cryptocurrencies from an unspeakable heresy to Wall Street plaything.

The problem is, we’re only, like, a quarter of the way there. At best. Look at what CME is doing: cash-settled futures. No transactions will be added to bitcoin’s public ledger, no cryptographic hash algorithms solved. Instead it’ll just be a reference rate floating somewhere a safe distance away from naturally occurring bitcoins in the wild. Futures traders won’t get true exposure to the asset, just wagers on a number that get tallied and settled at the end of the day.

Boring. Enough patting yourselves on the back with this bitcoin futures stuff, guys. It’s a necessary part of the process, sure, but it’s not really truly bitcoin. Bitcoin is placing an order and waiting 9 days for it to go through because bitcoin’s infrastructure is so fundamentally unsuited to its purpose. Bitcoin is lying awake at night wondering if the exchange holding your money will be the next to go up in smoke. Bitcoin is faith.

So who’s it gonna be? Which major bank will be the first to say damn the consequences, we’re going to make a market in this bonkers speculative bubble because that’s what the client wants and we’ll be damned if that’s not what the client is going to get?

Bankers have their obligatory objections, and they’re understandable. Bitcoin currently occupies a regulatory Twilight Zone. It’s catnip to hackers. It’s doesn’t really represent that much money. It’s plumbing consists of an invisible archipelago of private and at-times illicit operators in far-flung jurisdictions of questionable stability. Its very existence is a fuck-you to bankers. Etc.
It shouldn’t be hard to wave these all away. Who cares about the crypto-anarchist rhetoric; there’s money to be made....MUCH MORE
Earlier:
"Five Ways To Short Bitcoin" (and a backgrounder from Alphaville's Izabella Kaminska)

"U.S. Oil Production Hits 4th Straight Record High Ahead Of OPEC Meeting "

Here's the last two week's action in WTI:

From Investor's Business Daily:
U.S. crude production climbed to yet another record high ahead of a key meeting between OPEC and top nonmembers, potentially muddying expectations that they will extend an agreement to curb oil output.

Domestic production climbed to 9.682 million barrels per day last week from 9.658 million bpd in the prior week, according to the Energy Information Administration.

Crude stockpiles fell by 3.4 million barrels, while gasoline stockpiles rose by 3.6 million barrels. Analysts polled by S&P Global Platts expect a drop of 3 million barrels in U.S. oil inventories, with a 1.1 million-barrel increase in gasoline supplies.

The American Petroleum Institute, an industry group, said late Tuesday that U.S. stockpiles rose by 1.8 million barrels with gasoline stockpiles down 1.5 million barrels.

U.S. crude futures dipped 1.2% to $57.30 a barrel, their third straight decline, though they have surged in recent months on hopes OPEC will continue trimming output and on signs the global supply glut is finally easing. London-based Brent retreated 0.3% to $63.11....MORE
Recently:
Release the Fracklog: $65 Oil Frees Up 500,000 Barrels/Day

"Uber's third-quarter net loss widens to $1.46 billion: source" (FT says only $746 mil)

From Reuters:
Uber Technologies Inc’s [UBER.UL] quarterly losses widened, a source familiar with the matter told Reuters on Tuesday, as the ride-hailing company wades through legal troubles and faces regulatory scrutiny across the globe.

The Silicon Valley-based company’s net loss increased to $1.46 billion in the third quarter from $1.06 billion in the previous quarter, the source said. 

Quarterly net revenue rose 14 percent to $2 billion and gross bookings increased 11.5 percent to $9.7 billion, on a sequential basis, the person said. 

As a private company, Uber is not required to publicly report its financial results, but earlier this year it began offering a glimpse of its performance by disclosing certain numbers...MORE
Also via Reuters:

Uber's third-quarter adj loss widens to $743 mln - FT
Uber Technologies Inc’s quarterly adjusted losses widened to $743 million, up 14 percent from the previous quarter, the Financial Times reported on Tuesday.

The ride-hailing company's third-quarter net revenue stood at $2 billion, up 14 percent from the previous quarter, the FT reported citing new documents sent to shareholders. (on.ft.com/2BkXV8T)
Uber’s quarterly gross bookings were $9.7 billion, the FT reported....

Washington State Sues Uber, Using Their Math Could Value Damages From Data Breach at $114 Billion

The state is looking for up to $2000 in penalties for each of their 10,888 Uber drivers. Extrapolating the two grand figure to the 57 million drivers and passengers affected by the breach and failure to disclose for damages  is how we got to the $114 billion number.
If you are suing the Ubester for any reason, do it quickly. Apparently they lost almost $1.5 billion in the 3rd quarter, more on that in the next post.

From GeekWire:

Washington files first state suit against Uber over massive data breach, seeking millions in penalties
Washington state Attorney General Bob Ferguson is suing Uber in King County Superior Court for failing to report a massive data breach that exposed the personal information of 57 million Uber drivers and passengers around the world.

Washington is the first state to sue Uber over the breach, and Ferguson’s lawsuit is the first since the state’s consumer privacy laws were revised in 2015.

Drivers license numbers were exposed as part of the breach. Rather than notify victims, Uber acknowledged that it covered up the October 2016 incident by paying off the hackers behind the breach. The breach exposed the personal information of 10,888 Uber drivers in Washington state, according to the complaint.

The multi-million dollar lawsuit claims Uber violated Washington state’s revised data breach laws, which “require individuals, businesses, and public agencies to notify Washington residents who are at risk of harm because of a security breach that includes personal information.” Victims must be notified within 45 days of the breach’s discovery. If the breach affects more than 500 Washington residents, the attorney general’s office must also be notified.

Uber told Ferguson’s office about the breach on Nov. 21, 2017, about 372 days after the company discovered it.

“Instead of doing the right thing, following the law, and telling these thousands of Washingtonians they were at risk, Uber paid the hackers to delete the data and did not disclose the breach to anyone,” Ferguson said during a press conference Tuesday. “That is stunning. It violates the spirit and the letter of the law.”

Ferguson said his lawsuit is based on information already provided by Uber. His office will be conducting a further investigation as the case progresses.

After news of the breach broke last week, Uber fired its security chief and another employee associated with the coverup. The hackers who exposed personal information of Uber users figured out how to get into the company’s Amazon Web Services account through credentials pilfered from a Github site used by its engineers....MORE

Did Anyone Do Even a Minimal Check on the Sensationalist Bitcoin Electrical Consumption Story?

We didn't go with the sensationalistic "More electricity than Ireland or Nigeria or 159 countries..." stories but did post "Why the Biggest Bitcoin Mines Are in China" and "China’s Bitmain dominates bitcoin mining. Now it wants to cash in on artificial intelligence" which touched on electricity usage and bitcoin along with a couple others, see after the jump if interested.

From Charles Hugh Smith's Of Two Minds blog:
Let's start with a primer on how to write a sensationalist story that can be passed off as "journalism:"

1. Locate credible-sounding data that can be de-contextualized, i.e. sensationalized.

2. Present the data as "fact" rather than data that requires verification by disinterested researchers.

3. Exaggerate the data as much as possible and set the tone and context with emotionally laden words: "shocking," etc.

4. Select a context that sensationalizes the conclusion.

Now let's take a look at a story that has been swallowed whole, with little to no fact-checking or disinterested inquiry: bitcoin's electrical consumption, i.e. the electricity consumed by mining/maintaining bitcoin's blockchain.

One Bitcoin Transaction Now Uses as Much Energy as Your House in a Week

Let's start by stipulating that energy consumption is a consequential matter worthy of serious inquiry. It's important to measure the energy consumption of all the systems that operate within the current status quo, and compare the consumption levels of these systems.

With that in mind, let's take a look at the story.

Right off the bat, the context we're offered to grasp the enormity of bitcoin's mining consumption is the electrical consumption of Nigeria, a nation, we're breathlessly informed, with 186 million residents. Wow! That's a crazy amount of electrical consumption, right?

Let's do some very basic fact-checking before we accept sensationalist conclusions, shall we?

Nigeria consumes about 24 billion kWh annually, while the U.S. consumes 3,913 billion kWh annually.
So Nigeria uses 3/5th of 1% (0.6%) of the electricity the U.S. consumes.

Now let's compare that electrical consumption with the amount of electricity consumed in the U.S. by residential devices and chargers on stand-by, i.e. appliances, devices, chargers, gizmos, etc. that aren't in use and doing no work but that are still consuming electricity.

About a quarter of all residential energy consumption is used on devices in idle power mode, according to a study of Northern California by the Natural Resources Defense Council. That means that devices that are “off” or in standby or sleep mode can use up to the equivalent of 50 large power plants’ worth of electricity and cost more than $19 billion in electricity bills every year.

source: Just How Much Power Do Your Electronics Use When They Are ‘Off’? (May 7, 2016, New York Times)
(Please read the article to find out just how much power the 50+ gadgets in your home consume doing absolutely zero work.)

According to the U.S. Energy Information Administration, annual residential electrical consumption totals 1,410 billion kWh.
So 25% (the amount of household electricity consumed by stand-by devices) of 1,410 billion equals 352 billion kWh consumed annually by residential appliances and devices on stand-by in the U.S.......MUCH MORE
Other Bitcoin and electricity posts:
Heat Your House Mining Bitcoin!
Hey Mister Environmental, Social, Governance Investor: What the Hell Are You Doing In Bitcoin?
Convergence: "Bitcoin Mining in Electric Vehicles Raises Other Questions" (TSLA)—UPDATED

"Five Ways To Short Bitcoin" (and a backgrounder from Alphaville's Izabella Kaminska)

We'll get to the shorts in a second but first FT Alphaville:

Why Bitcoin futures and a shoddy market structure pose problems
There’s a popular opinion in cryptoland that the launch of bitcoin futures by the CME in December will trigger an investing rush as institutional investors and hedge funds wade into the market in size. This in turn, the theory goes, will see the price zoom even higher.

But here’s the thing. Smart money almost never takes unhedged directional bets.
To the contrary, it seeks out risk-free arbitrage opportunities that usually involve spread or basis-based trades that take advantage of market pricing anomalies.

Back in 2008, one of the biggest arbitrage opportunities of this sort came in the shape of the disconnect between US TIPs securities and conventional Treasuries, which emerged due to Lehman’s preference for using TIPs as collateral in repo trades. As the investment bank’s liquidity troubles escalated, the distressed selling of TIPs securities by the bank fueled a sharp rise in yields.

Due to the related financial panic, however, almost nobody (bar a few plucky hedge funds) was able to take advantage of the arbitrage on the table. This is because the cost of funding the trade far exceeded the potential windfalls most players could realise from it in the long run.

In the end, it was only when the Fed undertook its asset purchase programme, which included TIP securities on the shopping list, that a no-arbitrage condition was able to be reinstated. Interestingly, it didn’t even take all that much TIPs buying to do the trick.

So what’s the opportunity once the CME launches a reliable futures contract that’s both properly risk-managed and in full view of regulatory supervisors?

To understand this it’s worth taking a closer look at the details of the contract at hand. But also at why it’s been so incredibly hard to short bitcoin efficiently to date.

A few points become immediately obvious.

First, the CME contract as currently devised is set to be cash rather than physically settled. This is understandable to some degree. Imagine the security and monitoring burden for the CME of having to oversee delivery of actual (KYC/AML compliant) bitcoin into an inventory system and/or over to counterparties directly?

Cash settlement is much less of a potential liability in comparison.

And yet, it’s not without issue. Cash-settled derivatives depend on some sort of index to settle against, exposing it to Libor-style risks....
...MUCH MORE

Two quick points. My first thought when the futures were announced was "How will self-styled market makers lay off their risk when they take one side or the other?" (self styled because there are no formal market makers)
Secondly, arbitrage is pure alpha and the total amount of alpha (of which arb is a subset) is very, very small.
To get self-referential, from a 2013 post:
The entire amount of alpha available to the entire hedge fund industry is only $30 billion per year.
As reported by a hedge fund maven via Investment News back in 2006: [David A. Hsieh, Duke University]....

... Got that? All alpha not just arbitrage but all alpha was just $30 bil. in '06.
This is probably just a definitional problem so let's say it plainly:

In so called risk (merger) arbitrage the emphasis is on the first word.
Cash-and-carry, buying physical and shorting a derivative is not arbitrage.
When people use the term "arbed away" when talking about market anomalies the are not talking about an arbitrage.
Shorting an ETF and buying the component equities is not an arb, it's just a hedged trade.
Same for Index Arbitrage.
The total pool of arb opportunities may be as small as $1 billion.
Even the old Royal Dutch and Shell Transport trade was not an arb, just a fairly good pair trade....
So, words matter, something to keep in mind when reading the following. These are not shorts, by definition.
And from ZeroHedge:

Five Ways To Short Bitcoin
Looking to put bitcoin’s rise in context? How about this: Over the last five years, the world’s most valuable digital currency has risen an astonishing 11,000,000%. Furthermore, since Jan. 1, it has climbed 950%, compared with a total return of 18% for the S&P 500.

Given the torrid pace of bitcoin’s climb, one would imagine that there are few traders left who possess the wherewithal to short the digital currency. And until recently, the options to short bitcoin were mostly offered through unregulated exchanges, and very risky given bitcoin’s volatility.

But increasingly, mainstream exchanges have begun offering bitcoin-based derivatives that could make it easier for retail traders to short the digital currency. CME Group has said it will introduce a suite of bitcoin-linked products by the end of the year, and LedgerX, the first CFTC-approved Swap Execution Facility (or SEF), traded more than $1 million in bitcoin swaps and options during its first week.

In Switzerland, one exchange has introduced options that make it easier for investors to profit if the bitcoin price drops. But other more creative ways to short the digital currency have existed for a while now – in some cases, for years.

“All the options to short in common markets are becoming available in the bitcoin market,” said Charles Hayter, co-founder of market tracker CryptoCompare. “There’s pretty good liquidity for shorting bitcoin. The main difference with shorting the Nasdaq for example, is it will be a lot more volatile, so there’s a lot more risk. The rate to borrow will also be a bit higher."
With bitcoin on the cusp of breaking above $10,000 for the first time, here’s a list of popular options for shorting bitcoin, per Bloomberg.

Contracts for Difference
"One of the most popular ways to short bitcoin is through CFDs, a derivative that mirrors the movements of the asset. It’s a contract between the client and the broker, where the buyer and seller of the CFD agree to settle any rise or drop in prices in cash on the contract date.

'CFD is currently a great market if you want to short bitcoin, especially ahead of that milestone 10K mark, which we think will bring some retracement,' said Naeem Aslam, a chief market analyst at TF Global Markets in London, which offers the contracts. 'The break could push the price well above $10,100 and it would be in that area when we could see some retracement.'"
Margin Trading
"Another common way to short bitcoin is through margin trading, which allows investors to borrow the cryptocurrency from a broker to make the trade. The trade goes both ways; a trader can also increase their long or short position through leverage. Depending on the funds kept as collateral to pay back the debt, this option increases the already risky bitcoin trade. Bitfinex, one of the biggest cryptocurrency exchanges, requires initial equity of 30 percent of the position.

Short-margin trading positions on Bitfinex were at around 19,188 bitcoins on Monday, versus 23,931 long positions, according to bfxdata.com, which tracks data on the bourse."
Borrow to Short Bitcoin
"Most of the brokerages that allow margin trading will also let clients borrow bitcoin to short with no leverage. This will be a less risky way to bet bitcoin price will fall."
Futures Contracts
"The futures market isn’t as widely developed as CFDs and margin trading, but it’s still possible to make bearish bets on bitcoin with options. For now, LedgerX is the only regulated exchange and clearing agent for cryptocurrency options in the U.S. The CME Group Inc. and the Chicago Board Options Exchange have both asked for approval to list bitcoin futures, so that may open up the market to more investors."....MORE

Tuesday, November 28, 2017

"EA Shares Plummet After 'Star Wars: Battlefront II' Loot Box Fiasco"

The headline is a bit overwrought for a decline of under 10% but it does get ones attention which I suppose is the point.

From Forbes:
EA share prices have fallen 8.5% month-to-date, wiping out $3.1 billion in shareholder value in the process, all thanks to backlash over Star Wars: Battlefront II loot boxes.

The giant video game publisher is still having a banner year, with shares up 39% year-to-date, but there's no doubt that the backlash, combined with EA's decision to remove paid loot boxes from the game just hours before launch, rattled shareholders.

For one thing, it's unclear where EA goes from here, not just in its re-implementation of loot boxes in Star Wars: Battlefront II, but in terms of its larger micro-transaction strategy across all its games and franchises.

More troubling from an industry standpoint is the new threat of government involvement thanks to gambling concerns. Politicians in Europe and the United States are now paying closer attention to loot boxes than ever before, and the threat of government regulation looms.

"Battlefront II is the pointy tip of the iceberg," Cowen analyst Doug Creutz wrote in a note to clients Monday. "The biggest recent controversy has centered around EA's Star Wars Battlefront II, where early evidence suggests player anger over a mishandled loot box economy may in fact be impacting initial sales. We think the time has come for the industry to collectively establish a set of standards for MTX implementation, both to repair damaged player perceptions and avoid the threat of regulation."...MORE
If interested see also "Gambling, Investing and Gaming Loot Boxes".
And I hereby acknowledge I owe patient reader part II of same.
Though no promises as to delivery date.

UPDATE—"Can You Mine Cryptocurrency With a Tesla? A Feasibility Study"

Following up on "Convergence: "Bitcoin Mining in Electric Vehicles Raises Other Questions" (TSLA)".

From Motherboard:
Cryptocurrencies have an energy problem. The entire Bitcoin network now uses more energy than all of Ireland, and a single Bitcoin transaction requires the same amount of energy your house uses in a week. Ethereum, the second most popular cryptocurrency, isn’t much better. This is bad news for the environment, but also for the miners who generate cryptocurrencies with massive amounts of computing power, which can rack up a huge electricity bill.

So, it’s no surprise that miners have sought the cheapest forms of electricity to maximize their profits from mining cryptocurrencies. In China, where the largest Bitcoin mines are operated, miners use ultra-cheap hydro energy. In Europe, small scale miners are beginning to experiment with wind-powered mining rigs.

Now at least one Tesla owner is getting a piece of the action by installing mining rigs in their trunk to take advantage of the free electricity provided to some Tesla owners—or so it seems.
The rig was initially reported on the blog Eco Motoring News, but as a cryptocurrency miner myself I was immediately skeptical. Let’s go down the rabbit hole together, shall we?

A member of the Facebook group Tesla Owners Worldwide posted a photo of their Tesla mining rig to the group after another member jokingly suggested someone should try to use a Tesla to power a Bitcoin mining rig.

Mining Bitcoin requires specialized computer chips (ASICs) that perform repetitive math problems millions of times per second to verify Bitcoin transactions on the network. Other cryptocurrencies are similar, but rather than using specialized computer hardware, these currencies can be mined with off-the-shelf GPUs, the same types of computer chips used by gamers.

Based on the picture posted to the Facebook group, the Tesla isn’t being used to mine Bitcoin—there are no ASIC chips. Instead, there are four motherboards and four power supply units mounted to what looks like pieces of plywood. The blue cords are attached to powered risers, which are used to connect several GPUs to a single motherboard. In this case, each motherboard is outfitted to run 4 GPUs.

The GPUs are not connected to the risers in the picture, so it’s uncertain whether the person who posted it ever actually mined anything with their Tesla, or was just trying to get a laugh. As someone who has built and run a crappy Ethereum mining rig of their own, I’m skeptical about the feasibility of their plan....MORE
Also at Motherboard:
An Idiot’s Guide to Building an Ethereum Mining Rig

Judge Alsup to Uber's Attorney:

Via Forbes' Biz Carson:


"A bombshell letter reveals how Uber could have concealed 14,000 stolen documents in a high-profile trade secrets case"

Uber being Uber might work with a podunk city council; not recommended as a tactic with a Federal Judge.

From Quartz:
The Uber-Waymo trial scheduled to begin Dec. 4 has been postponed, after a bombshell allegation that Uber operated a covert unit tasked with stealing code and trade secrets from its competitors.
US district judge William Alsup ordered three Uber employees to appear today, in what was supposed to be the final pretrial conference, after the US Justice Department informed the court that Uber withheld key evidence—most notably a letter from an attorney representing Richard Jacobs, Uber’s former manager of global intelligence, alleging that its Market Analytics unit existed acquire “trade secrets, code-based & competitive intelligence.”

“I can no longer trust the words of the lawyers for Uber in this case,” the visibly angry judge said in court. “If even half of what is in that letter is true, it would be an injustice for Waymo to go to trial.” Alsup had referred the lawsuit for a criminal probe in May.

In a court filing on Nov. 27, Waymo alleged that Uber “intentionally withheld the Jacobs Letter and related materials to prevent Waymo from discovering material evidence in this case.” Waymo also asked to take a new deposition of Uber founder and former CEO Travis Kalanick, and of Angela Padilla, Uber’s deputy general counsel and recipient of the Jacobs letter.

According to tweets from James McPherson, a lawyer and autonomous driving analyst attending the pretrial hearing, Jacobs was terminated by Uber in the spring of 2017. His attorney then sent a letter to Uber making the allegations about the Market Analytics unit. Jacobs eventually settled out of court with Uber for $4.5 million, and is now cooperating with the company. That put him in the awkward position of disputing his own letter.

A Waymo attorney asked Jacobs under oath: “Your lawyer sent letter that you approved alleging that Market Analytics exists solely to acquire code and trade secrets from competitors, yes?” according to McPherson. Jacobs reportedly responded: “I disagree with this now. I have no firsthand knowledge. No knowledge at all.”

Jacobs also described Uber’s deliberate efforts to “prevent sensitive info from legal discovery.” “There was legal training around the use of attorney client privilege markings on written materials, and the implementation of encrypted and ephemeral communications, intended to both protect and destroy communications that might be considered sensitive,” he said, according to the Financial Times. Employees were told to use phone or video calls for sensitive conversations, and use the messaging app Wickr, which has encrypted, self-destructing messages....MORE
Previously:
Waymo v. Uber: "Meet the judge who codes — and decides tech’s biggest cases"

  
...MoFo lawyer Arturo Gonzalez told Alsup that complying with court orders to turn over information to Waymo, protecting Uber’s confidentiality, and not stepping on Levandowski’s rights is akin to navigating a “minefield.” Gonzalez noted that Levandowski -- but not Uber -- appealed Alsup’s ruling requiring Uber to turn over a report containing key evidence in the case....MORE 
MoFo lawyer?

This is the third time the mofo's have dissed Judge Alsup:

May 12
Uber Suffers Legal Setbacks In Europe, U.S.
In the Waymo case Uber's bid to make their arguments in private was turned down by the judge overseeing the action but even worse for Levandowski, hizzoner is using his Federal Judgeship powers.*
April 1
Uber: Judge Says He May Grant Waymo's Request For An Injunction Against Uber's Self Driving Efforts
I was going to put something together on Anthony Levandowski's use of the 5th amendment in a civil matter and some of the implications of doing so but didn't get to it. In the meantime here is a look at some high-buck lawyering and tactics of litigators...
I was thinking more along the lines of inferring guilt--in a criminal proceeding an inference from the assertion of the 5th amendment right is strictly verboten and judges so instruct the jury, whereas in most state courts (California being a notable exception) and U.S. federal court,  a civil pleading of the 5th may be assumed to be an admission of guilt.

But yeah, another implication is: if you piss off a tech savvy* federal judge you've got a problem....
And many more. Use the search blog box, keyword Waymo, if interested. 

Convergence: "Bitcoin Mining in Electric Vehicles Raises Other Questions" (TSLA)—UPDATED

Update: "Can You Mine Cryptocurrency With a Tesla? A Feasibility Study" .
Original post:

Wait til Elon gets next year's electricity bill.

From EcoMotoring News:

Some creative Tesla owners came up with a way to make a few bucks from their parked EVs: Cryptocurrency mining. This raises questions that shouldn’t just be aimed at bitcoin mining, or even electric vehicles.

For those unfamiliar, cryptocurrencies only work because there is a network of distributed computing that processes the transactions. To reward those offering the computing power, cryptocurrencies give fractions of new bitcoins to those who did the work of running the network. This is referred to as “mining” bitcoins and other cryptocurrencies. This was an expensive and power-hungry task that could wear out computer components much faster than usual.

Initially, many doing this used high-end graphics processing units, but as the money earned per device diminished, miners turned to specialized computer units, called ASICs, to do the task faster with less electricity. But the units are still not free and they still can use kilowatts of electricity for a handful of them. To reduce the overall cost of running mining computers, some miners put the computers throughout their homes to act as small space heaters and reduce their heating bill. Others run their rigs on solar panels to avoid a monthly power cost.

Any source of electricity you don’t have to pay the normal rate for, or that you don’t have to pay for at all, is an opportunity for miners to increase their already thin profits. Teslas and other EVs have free access to power at many charging stations, so it was probably only a matter of time until somebody decided to plug their mining computers in.
One member of the Tesla Owners Worldwide on Facebook suggested the idea, possibly in jest. Then another owner went ahead and did it, posting a photo of his setup. Some members suggested that his setup could pull as much as 3 kilowatts of power and would probably require the vehicle’s air conditioning to be on for cooling. Other members raised ethical questions. Is it stealing to use the power for something other than driving?

On the one hand, this could be a good way to offset the cost of owning an electric vehicle. On the other hand, it lowers the efficiency of the vehicle and increases the environmental impact. But then again, the mining was going to be done somewhere anyway, so does it really? Will many EV owners do this? Will they do it at places they were going to charge anyway, or will there be opportunistic fleets of EVs blocking up charging stations to make a quick buck? How will charging station owners respond?...
...MORE

HT: ZeroHedge

Recently:
Hey Mister Environmental, Social, Governance Investor: What the Hell Are You Doing In Bitcoin?

Release the Fracklog: $65 Oil Frees Up 500,000 Barrels/Day

That's an old headline, May of 2015. At the time our self effacing introduction was:
Although we continue to look for another trip below $50 we're starting to look a little silly calling for it publicly.
NYMEX June WTI $62.35 +$1.95....
As it turned out we were indeed again going below $50 and even after that bottom-and-recovery WTI revisited $40 a couple times:


The reason for this stroll down Memory Lane was a quick note in Million Dollar Way's Nov. 28 post on what's cookin' in the Bakken:
Wells For The Past Week Have Been Reported; Whiting With A Huge Well -- November 28, 2017
  • over seven days, seventeen (17) wells came off confidential list
  • all but four (4) were DUCs 
According to the trusty slide-rule that's 3/4 of the new producers having formerly been classified as Drilled but UnCompleted.

Meaning it is now profitable - even at the Bakken's steep discount to WTI, 20% or so over the years - to pump 10 million pounds of frac sand into the holes and connect 'em up to the system.

This train of thought prompted a quick trip to the EIA to see what the inventory was:

Drilling Productivity Report
Release Date:  November 13, 2017  |  Next Release: December 18, 2017  |


Drilled but uncompleted wells (DUC)
wells
Region September 2017 October 2017 change
Anadarko 914 921 7
Appalachia 786 791 5
Bakken 746 735 (11)
Eagle Ford 1,452 1,485 33
Haynesville 191 192 1
Niobrara 685 685 -   
Permian 2,430 2,533 103   
Total 7,204 7,342 138
NOTE:
The DPR report no longer contains the Marcellus and Utica regions in the downloadable report data file. These have been replaced by the Appalachia region.

Now all of these DUC's aren't uncompleted for oil=price economic reasons, sometime the crews can drill faster than the the wells can be completed but still...

It appears there are quite a few of these punctures into the earth's crust in just a few small areas of the small area called the United States:
https://www.eia.gov/petroleum/drilling/images/dpmapv4l-wtitle.png
We'll be back with more next month but in the meantime the Dakota Access Pipeline is going ahead which means, somewhere down the (rail) road Mr. Buffet's BNSF won't have all his DUC's in a row.
Burlington Northern tank cars coming out of the Bakken:


http://images.rigzone.com/images/home/article/img_45709_2_1.jpg

That's the Bakken Oil Express. It's only the fourth largest such loading facility in North Dakota.
Make sure you don't count the same car twice. Seven hundred barrels per.

I may be quackin' up, somebody please make the puns stop.

"A New, Low-Cost Space Tech Is Set To Disrupt Everything From Commodities Trading To Telecommunications"

From CB Insights, Nov. 19:

Hundreds of tiny, inexpensive satellites are being sent into orbit every year. Here’s how they’ll change our relationship with the world around us.
Nanosatellites – tiny satellites you can hold in your hand – are being launched into space at unprecedented rates.

As the pace of technological development speeds up, making it less and less expensive to send a “nanosat” into orbit, these machines could provide a value to society that extends far beyond space exploration.

In the future, nanosatellites will transform a variety of industries that utilize space information – from more accurate weather and climate predictions to better monitoring (and safety) of air and sea traffic to smarter forecasting of crop yields and commodities.

What are nanosatellites?
The International Space Station, currently the largest satellite in orbit around the earth, measures ~356 feet by ~240 feet.

Nanosatellites, on the other hand, are small satellites with a mass between 1 kg and 10 kg, or just 2.2 lbs to 22 lbs. Some nanosatellites are as small as just ten cubic centimeters. Yet they possess many of the same antennas, sensors, and control systems that make larger satellites so useful for space exploration and monitoring.

Nanosats that take a 10×10×10-unit cubic structure are known as CubeSats. A single-unit (or 1U) CubeSat has a mass no greater than 1.33 kg (2.93 lbs), but can be stacked with others to create 2U, 3U, or 6U rectangular models.
Until a few years ago, it cost at least $2M to build a functional satellite, regardless of size. Now, students and scientists can create nanosats using DIY kits and off-the-shelf components – allowing the machines to be made with budgets in the tens of thousands of dollars.

Launching a nanosat is also far cheaper than sending a normal satellite to space, which can cost many millions of dollars. These tiny “sats” can be launched en masse via ride-sharing on rockets, though the costs vary drastically based on satellite mass, distance into space, and nature or “payload” of the space mission.
Startup Open Cosmos, for example, provides “enabling services” for taking customers’ satellite plans from design to launch (in under 10 months) at prices starting around $630,000. Their one-stop-shop offering includes things like mission simulation, testing, and insurance.

Spaceflight, on the other hand, offers straightforward commercial pricing for ride-shares that can be booked within weeks of a pre-scheduled rocket launch – making it possible to send a 3U CubeSat to “low earth orbit” (LEO) for as little as $295,000.

As more and more nanosatellites are sent to space by universities, tech companies, government entities, and private citizens alike, they’ll provide comprehensive “coverage” of earth at an incredibly low cost – leading to game-changing transformations across each of the sectors discussed below....MUCH MORE

Signposts: Trucking Looking Very Good

From the transport/logistics pros at DC Velocity, Nov. 22:

Monthly index of truckload line-haul prices hit all-time record last month
Cass, Broughton index on multi-month tear.
A monthly index of truckload line-haul prices in October increased 5.5 percent from the year-earlier period, hitting the highest level since the index was formed in 2005, according to data published late yesterday.

The index, published by audit and payment firm Cass Information Systems Inc. and investment firm Broughton Capital Inc., measures pricing on a per-mile basis, and excludes the impact of fuel surcharges. Last month's reading surged close to 133, continuing a three-month tear for the index.

In response, Broughton Capital, run by long-time transport analyst Donald Broughton, has revised its pricing forecast three times in the past four months. In mid-summer, Broughton forecast 2017 rates in a range of -1 and 2 percent. In yesterday's announcement, Broughton updated his projections to show rates rising between a range of 2 percent and 4 percent.

Truckload rates have been moving up all year, paced by strong gains in the noncontract, or spot, market. Pricing has moved higher due to a combination of stronger freight demand, a continued shortage of qualified drivers, and concerns that federal regulations mandating that virtually all trucks be equipped with Electronic Logging Devices (ELD) by Dec. 18 will reduce miles travelled and driver productivity levels.

Separately, the trade group American Trucking Associations (ATA) said today that its seasonally adjusted for-hire tonnage index rose 3.3 percent in October, following a 1.9 percent decline in September....MORE

Leaders vs. Followers: Can VC Investors Spot The Next Big Thing?

Sometimes.

From Crunchbase:
Trends seem to rule everything. Whether it’s the cut of your trousers, how you take your coffee, or what makes up your stock portfolio, crazes, fads, and trends are strong motivating factors behind how all of us behave.

Many venture investors fancy themselves as both trendspotters and trendsetters. But are VCs really that good at getting out ahead of the curve? On an individual basis, probably not when it comes to identifying trends. Certainly not when it comes to individual investors consistently picking (and being able to invest in) the particular companies that take the lion’s share of a market. (If you need some convincing, just read some VCs’ regrets about missed opportunities.)

To answer this question for investors as a group, we examined four recent technical crazes—drones, virtual reality, artificial intelligence, and blockchain—to see how and where startup investing differs from the ups and downs of trendy technologies. Using data from Crunchbase and Google Trends, we’ll chart out this tendency to compare and contrasts venture investors and the general public as trend-spotters.

Inflecting Earlier
In many ways, venture investors are literally ahead of the curve. Oftentimes, their interest in new technologies ticks up earlier than the general public.

Entrepreneurs and their investors bandy about a lot of jargon, some more egregious than others. “Hockey stick” growth is one of the more useful terms of art, in that it provides an understandable, visual metaphor. That crook in the elbow, where growth deviates from a linear trajectory and goes polynomial – if not exponential – is the inflection point.

Where and when that inflection point occurs for different populations – in this case, venture investors versus the broader public – points to differences in awareness and risk tolerance. But in the most literal sense, they also indicate which population is generally “ahead of the curve.”

To determine how far ahead of the curve investors really are, we compared the relative trend-spotting abilities of venture investors to the broader (albeit generally tech-savvy) public. Our methods of doing so included plotting the number of Crunchbase-sourced venture deals in a given month against a Google Trends search score for several different technologies. And in an effort to reduce noise from news stories about, say, military drones, we pulled Google Trends data for interest in startups only.
Entrepreneurs and investors alike are no less resistant to the siren song of the trendy.
 
Data was sourced directly from Google Trends and measured on a scale of 100. And since Google Trends data is built off of simple keyword searches, we did the same to derive venture deal volume. We found companies in Crunchbase’s dataset that mention a specific keyword or phrase (like “artificial intelligence”) and then pulled the investment rounds raised by each of those companies. And to match deal volume to Google Trends data, we then adjusted venture deal volume to be on a scale of 100 as well.

By directly measuring responsiveness to keywords, we’ve been able to produce a reasonably fair comparison of how quickly venture investors and the general population pick up on the tech trends.
Below, you’ll see when investors (as measured by deal volume, in blue) and the broader public (by way of Google Trends data, in deep yellow) begin to pick up on the artificial intelligence trend.
And below you’ll see how investors and the broader public became aware of blockchain as both a startup buzzword and technical trend.
In both cases, venture investors have seemingly gotten out ahead of these trends. Both AI and blockchain provide interesting cases of technologies that are at their peak of public awareness and excitement.

With trends of all sorts, we can see these inflection points, too. And where these inflection points fall often echoes a theoretical model developed in the early 1960s by a communications researcher named Everett Rogers. His model for the “diffusion of innovations” suggests that broader awareness and adoption of new technologies is driven by word-of-mouth, starting with a core group of innovators and early adopters. In the case of AI startups, venture investors have been keenly interested since mid-2012, whereas AI startups didn’t capture the broader public’s search interest until mid-2015. In the case of blockchain technology, venture investors have been actively interested since late 2013, but it took almost two years for blockchain startups to gain search interest in the general public....MUCH MORE
Also at Crunchbase:
$300 Billion, And Other Crypto Numbers I Don’t Understand 

Today's Term Is 'Surveillance Capitalism'

In which The Register goes all Aux armes, citoyens! Aux barricades!!!!

https://artelista.s3.amazonaws.com/obras/big/9/4/9/8053343928449860.jpg
Sincere apologies to the  Louvre and the roving spirit of Delacroix.
From the Register:

Surveillance Capitalism thinks it won, but there's still time to unplug it
We gave up privacy for convenience, and 2018's the time to win both of them back
On a walk across the show floor at January's Consumer Electronics Show, a friend working in technology for nearly thirty years expressed unease at where it all seemed to be headed.
As I pulled my head away from a consumer door lock containing an embedded retinal scanner, I replied. “I don’t know what you’re talking about."

But I did. I could feel it in my gut and heard it from everyone else who’d spent a career working in technology. It isn’t just that a few megacorporations nearing trillion-dollar valuations have sucked all of the oxygen out of the room, it’s that they’ve become so big they’ve started to warp the fabric of reality.

Facebook got caught out in May using real-time emotional profiling to target vulnerable teenagers with commercial offers.

Google was caught out last week tracking Android users even when they’re not supposed to.
Amazon wants access to your home.

Apple developed a next-generation smartphone that provides a real-time stream of facial gestures to any app that wants to measure your emotional reactions. Hardly anyone cares because it also offers - so cute! - a poo animoji!

In any previous year, any one of these incidents might have have seen a massive outpouring of outrage, a pushback that would get these firms to amend their ways. In 2017, they just feel like a few more outrages in a year crowded with them.

Along with outrage fatigue we seem to be experiencing surveillance fatigue: it’s not creepy that Amazon wants inside your home or Apple wants to scan your face or Google wants to know where you are every single moment. Not creepy at all.

How did we get to this normalisation of pervasive surveillance?

Like the frog in the pot, it happened slowly. Over the course of my thirty-five year career, we’ve seen a steady shift from selling people things (hardware and software) to selling people to things - surveillance capitalism.

That all accelerated when the Web came along, funded by ads that capture data and let marketers to precisely identify, track, and profile viewers.

Google and Facebook took that technology to the next level, using artificial intelligence to build systems that continuously “grow” user profiles, harvesting every interaction for useable “behavioural metrics”.

Those profiles have become us, and they’re used to watch us.

The upside looks like what I’ve been calling “surveillance utopianism”: Amazon knows you so well they know exactly when the drone should stop by with the evening’s bottle of whatever wine you prefer, either nicely chilled or allowed to breathe. That’s the promise of a world where we’re so completely under surveillance. It’s a consumer paradise of products and needs satisfied before they even come to mind, because the profiling grows that smart....MORE
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