Category: Uncategorized

Leadership, Patreon-style

One of the three members of Patreon’s executive board has publicly called for killing those who aren’t on board with corporate political activism:

Twitter’s former CEO Dick Costolo has set Twitter ablaze by suggesting that those who disagree with the push to inject political activism into the workplace will be “lined up against the wall and shot.”

“Me-first capitalists who think you can separate society from business are going to be the first people lined up against the wall and shot in the revolution. I’ll happily provide video commentary,” tweeted Costolo, who ran Twitter between 2010 and 2015.

Costolo was replying to a tweet related to how Coinbase’s CEO has decided to separate business from political activism and offer an exit package for those employees who feel they can’t work in a company that doesn’t want to be hindered by politics and activism, as so many other companies have been distracted by in recent times.

“We focus minimally on causes not directly related to the mission,” Armstrong wrote.

But Costolo wasn’t impressed. “This isn’t great leadership. It’s the abdication of leadership. It’s the equivalent of telling your employees to ‘shut up and dribble,’” Costolo wrote.

Silicon Valley is “extremely left-leaning” Facebook CEO Mark Zuckerberg once admitted and, more increasingly than ever, many employees are trying to inject their activistic politics into the culture of many companies.

Costolo’s tweet is incendiary, not only because it was made during a time of political violence, but also because of the vocalization of a growing sentiment of intolerance to others expressing their viewpoints and threats toward those who don’t want to see homogenization of thought across many industries.

In light of this statement, it wouldn’t surprise me in the least if Costolo was the inspiration behind Patreon’s remarkably self-destructive decision to breach the very contract it unilaterally imposed on its users by suing them in a group action.

Ironically, under Patreon’s own professed standards, Costolo should be banned from Patreon.

Marketing doesn’t hold a monopoly

On corporate stupidity. The engineers, both hardware and software, also exhibit a reliable form of stupidity that has been known to prove terminal. From IN SEARCH OF STUPIDITY, which is the best business book I have ever read, and other than CORPORATE CANCER, which addresses an even more critical problem, possibly the most important.

SMS: Joel, what, in your opinion, is the single greatest development sin a software company can commit?

JS: Deciding to completely rewrite your product from scratch, on the theory that all your code is messy and bug-prone and is bloated and needs to be completely rethought and rebuilt from ground zero.

SMS: What’s wrong with that?

JS: Because it’s almost never true. It’s not like code rusts if it’s not used. The idea that new code is better than old is patently absurd. Old code has been used. It has been tested. Lots of bugs have been found, and they’ve been fixed. There’s nothing wrong with it.

SMS: Well, why do programmers constantly go charging into management’s offices claiming the existing code base is junk and has to be replaced?

JS: My theory is that this happens because it’s harder to read code than to write it. A programmer will whine about a function that he thinks is messy. It’s supposed to be a simple function to display a window or something, but for some reason it takes up two pages and has all these ugly little hairs and stuff on it and nobody knows why. OK. I’ll tell you why. Those are bug fixes. One of them fixes that bug that Jill had when she tried to install the thing on a computer that didn’t have Internet Explorer. Another one fixes a bug that occurs in low-memory conditions. Another one fixes some bug that occurred when the file is on a floppy disk and the user yanks out the diskette in the middle. That LoadLibrary call is sure ugly, but it makes the code work on old versions of Windows 95. When you throw that function away and start from scratch, you are throwing away all that knowledge. All those collected bug fixes. Years of programming work.

SMS: Well, let’s assume some of your top programmers walked in the door and said, “We absolutely have to rewrite this thing from scratch, top to bottom.” What’s the right response?

JS: What I learned from Charles Ferguson’s great book, High St@kes, No Prisoners, is that you need to hire programmers who can understand the business goals. People who can answer questions like “What does it really cost the company if we rewrite?” “How many months will it delay shipping the product?” “Will we sell enough marginal copies to justify the lost time and market share?” If your programmers insist on a rewrite, they probably don’t understand the financials of the company, or the competitive situation. Explain this to them. Then get an honest estimate for the rewrite effort and insist on a financial spreadsheet showing a detailed cost/benefit analysis for the rewrite.

SMS: Yeah, great, but, believe it or not, programmers have been known to, uh, “shave the truth” when it comes to such matters.

JS: What you’re seeing is the famous programmer tactic: All features that I want take 1 hour, all features that I don’t want take 99 years. If you suspect you are being lied to, just drill down. Get a schedule with granularity measured in hours, not months. Insist that each task have an estimate that is 2 days or less. If it’s longer than that, you need to break it down into subtasks or the schedule can’t be realistic.

SMS: Are there any circumstances where a complete code rewrite is justified?

JS: Probably not. The most extreme circumstance I can think of would be if you are simultaneously moving to a new platform and changing the architecture of the code dramatically. Even in this case you are probably better off looking at the old code as you develop the new code.

SMS: Hmm. Let’s take a look at your theory and compare it to some real-world software meltdowns. For instance, what happened at Netscape?

JS: Way back in April 2000, I wrote on my website that Netscape made the single worst strategic mistake that any software company can make by deciding to rewrite their code from scratch. Lou Montulli, one of the five programming superstars who did the original version of Navigator, e-mailed me to say, “I agree completely; it’s one of the major reasons I resigned from Netscape.” This one decision cost Netscape 4 years. That’s three years they spent with their prize aircraft carrier in 200,000 pieces in dry dock. They couldn’t add new features, couldn’t respond to the competitive threats from IE, and had to sit on their hands while Microsoft completely ate their lunch.

Coinbase cleans house

And the SJWs are panicked at the thought that other CEOs will follow the example set by Coinbase CEO Brian Armstrong:

It’s obvious what is motivating Armstrong. For years, activists concentrated in dead-weight departments like HR and advertising have assimilated functional, profitable companies into the left’s totalitarian borg. They demand racial hiring quotas, corporate censorship, and the propagation of sickening transgender propaganda.

Armstrong saw that a revolution like this was coming to his own company. According to Coindesk, “Armstrong began to plan for the company’s new position after several Coinbase engineers closed their laptops one day over the summer after Armstrong wouldn’t say ‘black lives matter’ externally amid social unrest over police killings of unarmed black men and women.”

Armstrong decided he wouldn’t be threatened. He’d heard the maxim “get woke, go broke” and bravely decided to quash the revolution before it happened. He didn’t pledge support for Donald Trump. He didn’t rename his company Coinbased. He merely said his company would abstain from politics, both publicly and in the workplace. But in 2020, even this is a revolutionary act, and Armstrong knows it. On Wednesday, he sent a follow-up letter to employees announcing that if any weren’t up for keeping politics and work separate, he’d pay them to go away. Six months of severance pay, it turns out, is a small price to purge far-left extremists from one’s company.

It is no wonder then that Armstrong’s defiant stand has the press and woke capital in a panic. It’s obvious that the vast majority of people, and in particular the vast majority of productive workers, prefer Armstrong’s corporate vision. They want to work at a business, not a gulag. If Armstrong can thrive while vocally rejecting the left’s political demands, then other corporate leaders will be emboldened to do the same.

While some people have theorized that Armstrong read Corporate Cancer, there is no reason to assume that’s the case. The connection between convergence and corporate losses is both obvious and undeniable – the NBA has lost 15.2 million viewers per Finals game, 77 percent of its TV audience, in the three years since 2017 – and Armstrong’s measures are very mild compared to those recommended in the book.

Imagine how terrified the reaction would be if corporations actually began eliminating their HR departments, hunting down their SJWs, and actively firing anyone who engaged in infracorporate activism in lieu of doing their jobs.

The importance of intelligence

Differences in intelligence matter. For members of the cognitive elite to maintain otherwise is like the rich arguing that money does not matter. Differences in g affect the lives of individuals and families. They help shape the social order and limit our ability to reshape it (Gottfredson, 1985, 1986b; Gottfredson & Sharf, 1988).

Much social policy has long been based on the false presumption that there exist no stubborn or consequential differences in mental capability. Worse than merely fruitless, such policy has produced one predictable failure and side effect after another, breeding widespread cynicism and recrimination. Educators routinely overpromise and schools, accordingly, consistently disappoint. Welfare reformers do not take seriously the possibility that today’s labor market cannot or will not utilize all low-IQ individuals, no matter how motivated they may be. Civil rights advocates resolutely ignore the possibility that a distressingly high proportion of poor Black youth may be more disadvantaged today by low IQ than by racial discrimination, and thus that they will realize few if any benefits (unlike their more able brethren) from ever-more aggressive affirmative action. Virtually everyone is capable of living productive, fulfilling lives in which they contribute to the general welfare of their communities. However, protecting and enhancing that potential requires us to appreciate its greater vulnerability to disruption among lower IQ individuals.

From a study entitled “Why g Matters: The Complexity of Everyday Life” by Linda Gottfredson. There are essentially three factors that determine what a society will be like. The first is average IQ. The second is the level of trust. And the third is religion.

Note that two of those factors are genetic and heritable.

Mailvox: a warning sign

A reader writes about an observation he has made in his travels through various small towns:

I don’t know what is going on but something is happening below the surface. Locally, the various banks have been shutting down branch offices all over. In the small towns, who owns the prime property at the intersection of Main and State Streets? Banks.

I was talking to someone whose husband ran a branch is a small town. The bank shut down that office. He got out of finance. In a small town of 5,000 in the borough and another 5,000 or so in the township, a big player shut down its branch. That property is now up for sale. That office had been in existence as long as I can remember.

This town used to have in the early 80s a Chevy-Oldsmobile, Ford, Dodge, Chrysler-Plymouth, and Pontiac-Buick dealerships. All are gone now. The Chrysler dealership built a new building in another small town in the county. The original location deals only in used cars now.

Something is up with the banks.

Banks don’t make their money from deposits anymore. And increasingly, they don’t make money from loans anymore. So there simply isn’t any point in maintaining branches for service to non-revenue-producing customers who have no savings and can’t take out any more loans.

It’s interesting that they’re trying to sell the real estate, though. That tends to indicate that they need cash. It won’t be even remotely surprising if the next financial crisis starts later this month; I would be very surprised if it didn’t start before the end of 2021.

Civilization or tribal rule

Choose one.

As for me, I won’t even hesitate to take Chopin, Wagner, Tchaikovsky, and Liszt. Understand that this is a war against Christianity, America, and Western civilization. Choose wrong, and forget classical music, you won’t even have flush toilets.

Mailvox: the wolves are not new

Even if the Apostle Paul hadn’t warned us about the dangers of false “Christian” leaders infiltrating the flock, William Bradford, the first governor of Plymouth colony, did in his book Plymouth Plantation:

In Chapter Five, Bradford discusses a minister named John Lyford who arrived a few years after Plymouth was founded. Lyford was the textbook example of an SJW.

He immediately sought to become a church member upon arrival and after that started defending “delinquents” in the colony while holding secret meetings and spreading gossip. His plan of course was to divide the community and start a separate church he would control.

He was caught sending slanderous letters to England about people in the colony, on top of intercepting his own friends’ letters and annotating them before resealing them. Like a true social justice warrior, Lyford lied and denied he wrote the letters until they were produced. He then engaged in theatrical displays of repentance and pleas for forgiveness to the point where he generated sympathy among colony members – only to secretly write letters to England defending his behavior.

It is then that Lyford’s wife reveals to Bradford her husband’s history back home in England and Ireland as a pathological liar and philander to the point where she couldn’t have a female servant in the house because he slept with all the others. This was on top of lying to her about fathering a bastard child prior to their marriage. Then men from England report to Bradford that while “counseling” a young man contemplating marriage, Leyford met the girl in private and raped her, who later married the young man without telling him until afterwards.

Bradford writes that after they expelled him from Plymouth, Lyford proceeded to abandon all his friends that still stuck with him and died shortly afterwards in Virginia.

There’s a reason why St. Paul and other apostles warned about false teachers in their letters.They have been a threat to the church since the beginning, anywhere a group of Christians gather. What we’re experiencing today is not unique. The question is whether a body of believers under attack or being infiltrated are led by strong men with the moral courage to identify, confront, and cast the wolves out, or cowards who have exchanged truth for niceness.

Predators not only go where the prey is, they have a very finely attuned understand of how to go about putting themselves in position to obtain it. Always be very, very dubious of any enthusiastic new member who is extremely helpful and assiduously pursues leadership and other positions of influence.

The Puritans had the sense to expel this predator. Unfortunately, and despite the Biblical admonition, most modern churches won’t expel anyone, not for adultery, not for abortion, and not for axe-murdering.

Suddenly, for no reason at all….

Not content with attacking the 1st Amendment, Neopalestinians in Congress are now seeking to give Israel a veto over U.S. arms sales:

A bipartisan bill introduced in the House of Representatives would enhance protections for Israel’s qualitative military edge to include an effective Israeli veto on US arms sales to the Middle East.

The bill “would require the President to consult with the Israeli government to ensure [qualitative military edge] concerns are settled” when it comes to arms sales to Middle Eastern countries, said the news release Friday announcing its introduction the previous day. The release came from the office of the bill’s lead sponsor, Rep. Brad Schneider, D-Ill.

Existing law already guarantees Israel a qualitative military edge in the Middle East, but Congress — not Israel — is the arbiter of whether an arms sale meets QME standards.

Do they not truly understand that this sort of machination is going to fill the average American with the hitherto undiscovered desire to sell nukes to Hamas and Iran? Or is it that they do not care?

The stupidity and short-sightedness is relentless.

The banks SHOULD collapse

Whether the US government will permit them to go under, or whether it will attempt to kick the can further into the future like it did in 2008, is the only real question. This is a very good article on The Atlantic addressing how the banks have changed their debt-drug of choice from Collateralized Debt Obligations to Collateralized Loan Obligations. To translate that into English, the U.S. banking system has replaced its fragile foundation of homeowner debt with corporate debt:

After the housing crisis, subprime CDOs naturally fell out of favor. Demand shifted to a similar—and similarly risky—instrument, one that even has a similar name: the CLO, or collateralized loan obligation. A CLO walks and talks like a CDO, but in place of loans made to home buyers are loans made to businesses—specifically, troubled businesses. CLOs bundle together so-called leveraged loans, the subprime mortgages of the corporate world. These are loans made to companies that have maxed out their borrowing and can no longer sell bonds directly to investors or qualify for a traditional bank loan. There are more than $1 trillion worth of leveraged loans currently outstanding. The majority are held in CLOs.

Just as easy mortgages fueled economic growth in the 2000s, cheap corporate debt has done so in the past decade, and many companies have binged on it.

I was part of the group that structured and sold CDOs and CLOs at Morgan Stanley in the 1990s. The two securities are remarkably alike. Like a CDO, a CLO has multiple layers, which are sold separately. The bottom layer is the riskiest, the top the safest. If just a few of the loans in a CLO default, the bottom layer will suffer a loss and the other layers will remain safe. If the defaults increase, the bottom layer will lose even more, and the pain will start to work its way up the layers. The top layer, however, remains protected: It loses money only after the lower layers have been wiped out.

Unless you work in finance, you probably haven’t heard of CLOs, but according to many estimates, the CLO market is bigger than the subprime-mortgage CDO market was in its heyday. The Bank for International Settlements, which helps central banks pursue financial stability, has estimated the overall size of the CDO market in 2007 at $640 billion; it estimated the overall size of the CLO market in 2018 at $750 billion. More than $130 billion worth of CLOs have been created since then, some even in recent months. Just as easy mortgages fueled economic growth in the 2000s, cheap corporate debt has done so in the past decade, and many companies have binged on it.

Despite their obvious resemblance to the villain of the last crash, CLOs have been praised by Federal Reserve Chair Jerome Powell and Treasury Secretary Steven Mnuchin for moving the risk of leveraged loans outside the banking system. Like former Fed Chair Alan Greenspan, who downplayed the risks posed by subprime mortgages, Powell and Mnuchin have downplayed any trouble CLOs could pose for banks, arguing that the risk is contained within the CLOs themselves.

These sanguine views are hard to square with reality. The Bank for International Settlements estimates that, across the globe, banks held at least $250 billion worth of CLOs at the end of 2018. Last July, one month after Powell declared in a press conference that “the risk isn’t in the banks,” two economists from the Federal Reserve reported that U.S. depository institutions and their holding companies owned more than $110 billion worth of CLOs issued out of the Cayman Islands alone. A more complete picture is hard to come by, in part because banks have been inconsistent about reporting their CLO holdings. The Financial Stability Board, which monitors the global financial system, warned in December that 14 percent of CLOs—more than $100 billion worth—are unaccounted for.

I have a checking account and a home mortgage with Wells Fargo; I decided to see how heavily invested my bank is in CLOs. I had to dig deep into the footnotes of the bank’s most recent annual report, all the way to page 144. Listed there are its “available for sale” accounts. These are investments a bank plans to sell at some point, though not necessarily right away. The list contains the categories of safe assets you might expect: U.S. Treasury bonds, municipal bonds, and so on. Nestled among them is an item called “collateralized loan and other obligations”—CLOs. I ran my finger across the page to see the total for these investments, investments that Powell and Mnuchin have asserted are “outside the banking system.”

The total is $29.7 billion. It is a massive number. And it is inside the bank.

You’ll note that I correctly predicted this year’s economic crash… although the financial aspect has yet to show up despite an economic contraction of nearly one-third. The CLO meltdown is how the economic crash is most likely to translate to the inevitable financial crash, whether it happens before or after the end of the calendar year.

Solving a philosophical riddle

We now know the answer to whether a tree that falls in the forest makes a sound, as according to the media, things only happen when they happen to Hellmouth celebrities on camera:

Horrifying moment stranger in an ‘I love NY’ hoodie punches 67-year-old, 5ft 5in Ghostbusters star Rick Moranis, 67, in the head in unprovoked attack in New York. Hollywood star Rick Moranis, 67, was walking on New York City’s Upper West Side on Thursday around 7.30am when he was attacked. Surveillance footage captures a stranger walking past him abruptly punching Moranis in the head, knocking him to the ground.

It was a stranger. A stranger in a hoodie. We don’t know anything else about the stranger, or what could possibly have this stranger inspired to punch a Hollywood star unprovoked.

It is a mystery.