Mirage pushing stock valuations. U.S. companies have been repurchasing their own shares at a blistering pace for more than a year, and market turbulence isn’t likely to stop them now. [Wall Street Journal, May 17, 19] little new capital investment by new cash for selling stockholders. In all, a mirage of values.
Job growth at the smallest businesses has fallen to the lowest levels in nearly eight years as tiny companies struggle to attract and retain workers in the tightest U.S. job market in half a century. [Wall Street Journal, May 13, 19] Given enough time, Trump's economic game could devestate the US economy.
Dr. Peter Hart, recalled in an interview that in recruiting Dr. Nilsson, Mr. Rosen had poked his finger at Dr. Nilsson’s chest and said: “Radar? That’s like doing research on light bulbs! You have to come help us design these learning machines.” [John Markoff's obituary for Nils Nlisson, robot pioneer at Stanford University, NYTimes, Apr 27, 19]
Too free speech. We have a world where people live in cognitive bubbles of the like-minded and share one another’s biases and prejudices. According to this savvy view, our brave new world is too prone to propaganda and conspiracy-mongering to rely on Mill’s optimism about free speech [as the best disinfectant]. To do so is to risk abetting the rise of fascist and absolutist tendencies. [David Johnson, Aeon, Apr 21, 19]
Twitter: the place to go for all your drive-by crucifixion needs. [Dwight Garner, New York Times, Apr 21, 19]
The middle class is shrinking and its economic power diminishing in the U.S. and other rich countries, a development that threatens political stability and economic growth, according to a report by the OECD. [Wall Street Journal, Apr 11, 19] Meanwhile our presidential champion of the downtrodden xenophobic white unemployed class has had two years of improving the lot of the richest, including himself, with tax "reform" and appointment of business allies to government posts to further improve the lot of established businesses, while distracting the xenophobes with loud talk about the Southern borders For this bounty, he urges us to re-elect him.
How's your self-importance? Astrophyisicists, for $50m of publicly funded ressearch, showed a picture of a massive black hole 53 milion light years from Earth. [Seth Borensten, AP, Apr 10, 19] The very idea of the "known" universe and the unknown scale of other possible universes and other possible structures of matter and energy, and the complete human ignorance of the source of any of it, reminds us the insignficance of our brief existances.
The biggest [Silicon Valley VC] decline has come in the number of angel and seed funding deals, which fell 44.2 percent between 2015 and 2018. [Cameron Schubarth, Silicon Valley Business Journal, Apr 8, 19]
Tech mafia: In Silicon Valley’s tightknit club, success typically hinges on whom you know. Employees of tech startups frequently leave the companies once they have been enriched by their firms’ [IPO]s networks of alumni from these companies — called mafias — support their peers’ new businesses with hiring, advice and money. [Erin Griffith, New York Times, Mar 17, 19]
Chinese investment in U.S. startups has remained resilient in recent months despite new legislation that some thought could severely hamper deal flow, according to a new report from research firm Rhodium Group, after a record $3.3 billion in 2018. [Rolfe Winkler, Wall Street Journal, Mar 15, 19]
Refreshing techies. Modern Elder Academy [Resort] in El Pescadero, Mexico, considers “applications” for one-week programs [with] “tuition” of $5,000 ... aimed at workers in the digital economy — those who feel like software is speeding up while they are slowing down, no matter how old they really are. ... More workers are finding themselves in the curious position of presenting as old while still being — technically, actuarially — quite young. And Modern Elder sees a business opportunity in selling them coping workshops, salt-air yoga and access to a shaman. [Nellie Bowles, New York Times, Mar 4, 19]
Innovation not enough. The fracking industry is struggling to attract investors after nearly a decade of losing money. [Wall Street Journal, Feb 25, 19]
Small-business optimism is down for five straight months and hit a more-than-two-year low in January amid uncertainty about domestic politics and global growth. [Jeff Sparshott, Wall Street Journal, Feb 21, 19]
In the largest analysis of the issue thus far, investigators have found that the smaller the research team working on a problem, the more likely it was to generate innovative solutions. Large consortiums are still important drivers of progress, but they are best suited to confirming or consolidating novel findings, rather than generating them. The new research [is] published in the journal Nature. .... a trio of investigators led by James A. Evans, a sociologist at the University of Chicago, mined selections from three vast databases: the Web of Science, using more than 42 million articles published since 1950; the United States Patent and Trademark Office, with 5 million patents granted since 1976; and GitHub, with 16 million software projects posted since 2011. [Benedict Carey, NY Times, Feb 13, 19]
A soft future. CB Insights, a firm that tracks start-ups, analyzed a variety of data to create a list of 50 private companies around the world that are on a path to a $1 billion valuation. [Erin Griffith, NY Times, Feb. 10, 19] One of the fifty is doing something to create a new market - in oncology. The rest are mostly software that are almost all certain to work. The only risk is business risk - will it make a profit.
She offers clues, lingering on the nation’s narcissistic impulses, its fights over identity politics and the naivete of thinkers who believed that globalization would break down nationalism rather than intensify it. [Carlos Lozada reviewing Ratner-Rosenhagen's The Ideas That Made America, WashPo, Feb 8, 19]
“It is not that machines are going to replace chemists. It’s that the chemists who use machines will replace those that don’t.” —Derek Lowe, a longtime drug discovery researcher, tells the New York Times that artificial intelligence techniques will play a growing role within his field. [MIT Tech Rvw, Feb 6, 19]
Born to lead? Mary C. Daly was a high-school dropout in a small town outside St. Louis who believed her best option in life was to become a bus driver. ... Today Daly, 56, is president of the Federal Reserve Bank of San Francisco, making her one of the most powerful shapers of economic policy in the United States. [Heather Long, Washington Post, Jan 27, 19]
Einstein said. ‘For knowledge is limited, whereas imagination embraces the entire world, stimulating progress, giving birth to evolution.’ [quoted by Steven Shapin reviewing Pimental's The Rhinoceros and the Megatherium, London Review of Books, March 2019]
Not as many new companies have been forming since 2000 — for reasons that experts don’t totally understand — and existing companies have been expanding at a slower rate. (The pace of job cuts has also fallen, which is why the unemployment rate has stayed low.) Rather than starting new projects, companies are sitting on big piles of cash or distributing it to their shareholders. ... Over all, though, the generational gap in both income and wealth is growing. [David Leonhardt, NY Times, Jan 28, 19]
A changed world. The sum of US imports and exports as a percentage of GDP nearly doubled from 1986, when this ratio was 16.9 percent, to 30.9 percent in 2013, only to decline slightly to 26.5 percent in 2016 (based on data from the World Development Indicators of the World Bank at https://data.worldbank.org/indicator/NE.TRD.GNFS.ZS?locations=US). [Joel Slemrod, J Economic Perspectives, Fall 2018]
An early prototype of Boeing’s self-driving air taxi completed its first flight, marking what could be an early breakthrough in the company’s vision for autonomous, on-demand flight. The aircraft successfully took off, hovered and landed, all of which employed its autonomous navigation and landing systems, according to a [compamy] release... The test marks an early milestone for Boeing’s Aurora Flight Sciences (Manassas, VA; $25M SBIR) subsidiary, which it acquired in 2017 for a sum that wasn’t disclosed. [Aaron Gregg, WashPo, Jan 23, 19]
Plenty of capital. Over the six-year period from 2013 to 2018, as total venture capital investments nearly tripled, growing from $47.5 billion in 2013 to nearly $131 billion in 2014, the number of deals increased by just 13.5 percent according to new data from the NVCA-PitchBook Venture Capital Monitor. The $131 billion in total VC investments in 2018 is the largest amount since PitchBook began tracking the data in 2006 and the first year since the height of the dot-com boom that annual capital investment eclipsed $100 billion. [SSTI, Jan 23, 19] The idea that small biz needs SBIR, because there is too little money being invested in innovation, looks silly when viewed thru a VC lens, especially when government agencies have autonomy to fund whatever they want.
Although we may think we have the most sophisticated understanding of finance than anyone before us, the recurrence of financial crises and other financial problems over time, as demonstrated in this book, suggests that we could use some history lessons. [Yongseok Shin reviewing William N. Goetzmann’s Money Changes Everything: How Finance Made Civilization Possible, J Economic Literature, Dec 2018]
there has never been a better example of the unforeseen benefits of pure research because no one guessed that a technique of such power and universality would emerge from what appeared to be a fascinating but arcane corner of biology [Peter Forbes reviewing A Crack in Creation by Jennifer Doudna and Samuel Sternberg].
James P. Allison, once an outsider from the small Texas town of Alice, who went on to discover how T cells could be programmed to fight cancerous tumors. ... a basic science researcher happy to be wrong 99 times to be right once.” ... the fact that Allison won the Nobel Prize in Physiology or Medicine this past October assures immunotherapy its rightful place in the fight against cancer. [Mimi Swartz reviewing Graeber's THE BREAKTHROUGH Immunotherapy and the Race to Cure Cancer, NY Times, Jan 12, 19]
Generative adversarial networks (GANs) are the hottest neural network technique around. But they could also give us insight into how AI algorithms “think,” writes Karen Hao. ... Researchers fed a GAN various photos of scenery—trees, grass, buildings, and sky. They found that, over time, it learned to organize the pixels into sensible groups without being explicitly told how [MIT Tech Rvw, Jan 10, 19]
Ben succeeds, state cuts funding An independent economic analysis of the Ben Franklin Technology Partners reveals its impact on Pennsylvania’s economy — boosting the overall economy by $4.1 billion between 2012 and 2016, helping to create 11,407 high-paying jobs and generating $385 million in tax receipts for the state. Because the jobs were created in industries that pay 52 percent higher than the average nonfarm salary in Pennsylvania, the impact on the state’s GSP was greater, according to the report. However, such impact is threatened by decreasing state funding in the program, [which] has dropped more than 50 percent since 2007-08. [SSTI, Jan 19, 19]
Small-capitalization companies are projected to notch another year of big profit gains, potentially making their shares a haven for investors as earnings at larger firms slow. Analysts are expecting firms in the Russell 2000 index of small-capitalization companies collectively to post double-digit profit gains throughout 2019, according to financial-data provider Refinitiv, far outpacing the S&P 500. Russell 2000 companies tend to have market capitalizations of $300 million to $2 billion. [Michael Wursthorn, Wall Street Journal, Jan 8, 19] Professional guess-work in a fluid world.
Remaking nature. Genetic engineers in Illinois have designed tobacco plants that grow as much as 40% larger than usual. ... The scientists gave tobacco what’s called a “photorespiratory bypass”—genetic changes that let the plants turn sunlight into energy more efficiently. To do it, about 16,000 letters of novel DNA instructions were added to the plants. Today tobacco, tomorrow…: The team is now making similar gene changes to potatoes, soybeans, and cowpeas. However, it could take 20 years to prove that the modifications actually produce more food and to get the new crops approved by regulators.[Antonio Regalado, MIT Tech Rvw, Jan 5, 19] Long term consequences? TBD.
The low cost of living and the healthy economy, bolstered by jobs in tech and cybersecurity, have made San Antonio the fastest-growing city in the country for the past several years, and given it the nation’s second-fastest-growing population of millennials, according to the Brookings Institution. [Amy Chozick, NYTimes, Jan 5, 19]
Its inhabitants work as if they must get rich by the evening and die the next day. [Alexis de Toqueville, 1835]
because the internet is so expansive, you can find the six people among the 6 billion out there in the world that actually believe the crazy things that you believe. [Francis Fukayama on identity politics, Reason.com, Dec 26, 18]
Memento Homo. Within living memory Britain was one of the world’s leading powers and its parliamentary system lauded as the most successful model of democratic governance. At the start of 2019, British prestige and power are touching new lows. [Walter Russell Mead, Wall Street Jounal, Dec 31, 18]
Personal technology was so awful this year that nobody would think you were paranoid if you dug a hole and buried your computer, phone and smart speaker under six feet of earth. ... Unfortunately, there is no simple solution for problems like hate speech and misinformation. [Brian Chen, New York Times, Dec 26, 18]
After the political promises and false claims, the U.S. trade deficit keeps widening. [Wall Street Journal, Dec 26, 18]
A couple of Wall Street guys with deep pockets and a high tolerance for risk have launched a new startup incubator in San Diego, filling a role that’s been in high demand here for decades. The incubator, ThinkTank Innovation, is offering free office space to 20 technology startups in San Diego [Brittany Meiling, San Diego Union Tribune, Dec 17, 18]
Academic research in the US is unplanned, exploitative and driven by a lust for glory. The result is the envy of the world. [David Labaree, Aeon, Dec 17, 18] Nevertheless, one or more Congresscritters will complain of useless research being publicly funded (except for the money going into his district).
Bringing them home. Americans now collectively own most of the public equity of China’s biggest tech companies ... But China’s regulatory apparatus [focused on bringing its largest crown jewels home] started taking an ax to the tech behemoths this year, sending their share prices into free-fall. ... Despite the warning signs, American investors continue lining up for Chinese initial public offerings. In fact, Chinese companies have raised more than $8.5 billion in U.S. markets this year. [Jesse M. Fried and Matthew Schoenfeld, Wall Street Journal, Dec 13, 18]
The cities with the most startups and investment tend to see more business formation, but a long-term challenge lurks: If a superstar city becomes too large, the service workers who aren’t benefiting from the boom will be priced out. In the end, this might limit the size of these cities—at least until many of those workers are replaced by robots. [Christopher Mims, Wall Street Journal, Dec 14, 18]
Better together. the inescapable reality of agglomeration, one of the most powerful forces shaping the American economy over the last three decades. Innovative companies choose to locate where other successful, innovative companies are. That’s where they can find lots of highly skilled workers. The more densely packed these pools of talent are, the more workers can learn from each other and the more productive they become. This dynamic feeds on itself, drawing more high-tech firms and highly skilled workers to where they already are. [Eduardo Porter, New York Times, Dec 15, 18]
It’s been said that the four most expensive words in the world are: ‘This time it’s different.’ We can ignore the lessons of history and indeed of common sense because there’s a new paradigm, a new set of tools and techniques, a new Great Moderation. ... One way of describing modern finance is that it’s a mechanism for enabling very clever, very well paid, very highly incentivised people to spend all day every day thinking of ways to get around rules. [John Lanchester, London Review of Books, Jul 5, 18]
Catching up. mainland China now produces more graduates in science and engineering every year than the United States, Japan, South Korea and Taiwan combined. In cities like Shanghai [population 23M], Chinese schoolchildren outperform peers around the world. most students also enroll in after-school tutoring programs — a market worth $125 billion, according to one study, or as much as half the government’s annual military budget. [Philip Pan, New York Times, Nov 24, 18]
Truth becomes personal. The result is a misinformation ecosystem in which everything is true, especially if you believe it to be so. Anyone and everyone is an expert, steered toward the facts they think they already know. It’s like a vast clothes dryer with a defective lint trap: As the lint accumulates, we begin draping ourselves in the fluff, confident that what we’re wearing counts as clothing. “I have no academic credentials,” one speaker at the flat-earth conference told the audience. “But I do have a cloak of credibility.” [Alan Burdick, New York Times, Nov 19, 18]
America is still the world’s largest centre of innovation. It spends $450bn a year on R&D, 20% more than China and more than Europe, Japan and South Korea combined. [The Economist, Nov 15, 18]
Suddenly, the global economy isn’t looking so great. German and Japanese GDP shrank in the third quarter, momentum in China is vanishing, oil prices are tanking, the U.S. and China are still sparring over trade, and the big U.S. fiscal stimulus is set to fade as deficits grow. [Jeff Sparshott, WSJ, Nov 14, 18]
In-Q-Tel [CIA's VC] set up new offices in Sydney and London to gain access to startups with novel commercial technologies that can aid intelligence and national security missions of the U.S. and international partners. [Jane Edwards, executivebiz.com, Nov 15, 18]
many of the 30,000 attendees huddled as Tim Berners-Lee, inventor of the web, kicked off proceedings with an impassioned plea to save his creation from “fake people, fake ideas and fake truth.” He launched a “Contract for the Web,” a set of principles for companies, governments and citizens, which will be turned into full guidelines by May 2019, when half the world is due to be online. [@charlottejee, MIT Tech Rvw, Nov 5, 18]
Our strong defenses. German scientists added to ongoing concerns that human immune systems might counteract or reject medicines that use CRISPR-Cas9. In a study of 48 blood samples, 96 percent showed T-cell immunity against Cas9, and 85 percent had antibodies against the protein. [Alex Lash, xconomy.com, Nov 2, 18]
Netscape IPO on Aug. 9, 1995, when the stock of a fairly obscure company peddling a seemingly arcane product went on sale. By the end of the first day, a corporation that had no significant profits was worth $2.1 billion. [Jon Gertner reviewing McCullough's How the Internet Happened, Wall Street Journal, Nov 1, 18]
American companies maintain a major advantage over their Chinese rivals in a critical area: spending on research and development. U.S. firms invested more than $5 in R&D for every $1 spent by Chinese companies, according to a new report from PricewaterhouseCoopers. [Jeff Sparshott, Wall Street Journal, Oct 30, 18]
Avagadro's Number Day for Chemists. Avogadro's number, number of units in one mole of any substance (defined as its molecular weight in grams), equal to 6.022140857 × 10exp23.
Breakthrough Prize In Life Sciences [for $3 million] awarded to C. Frank Bennett and Adrian R. Krainer – Ionis Pharmaceuticals and Cold Spring Harbor Laboratory, respectively for the development of an effective antisense oligonucleotide therapy for children with the neurodegenerative disease spinal muscular atrophy. .... The prize was founded in 2013 sponsored by Sergey Brin, Priscilla Chan and Mark Zuckerberg, Pony Ma, Yuri and Julia Milner, and Anne Wojcicki. [breakthroughprize.org/News/47, Oct 17, 18]
[3D printing] technology has been around for more than three decades without noticeably transforming the world, but monumental advances in manufacturing are finally imminent, Richard D’Aveni argues in “The Pan-Industrial Revolution.” He envisions 3D printing combining with powerful software networks, machine learning and artificial intelligence to force vast changes in how and where products are made. [James Hagerty, Wall Streeet Journal, Oct 17m 18]
Upward, ever upward boom? the remarkable performance in the US stock market since 2009 and in the housing market since 2012 are a result of a newly emergent belief system, reinforced by a psychological dynamic that operates according to well-defined psychological principles, based, erroneously, on the belief that past growth in market prices is strong positive evidence for more growth in the near future. [Robert Shiller, NYTimes, Oct 12, 18] If you have to choose between Kudlow and Shiller, look to the qualifications of shill and Shiller.
Polarized. The proportion of parents who would be disturbed if their child married someone from the opposite party has risen from 5 percent in 1960 to about 50 percent now.
Down in the Valley. thanks to its past success [Silicon Valley] is no longer the ferment it once was, and it is unlikely it will ever again dominate the technology world in quite the way it has over the past decades. ... “The payoff of a higher-risk startup is not so different from what you would get over the same number of years at Google or Facebook earning top dollar,” explains Yelp’s Mr Stoppelman. ... “If you ask me ten years from now why Silicon Valley failed, it will be because we screwed up immigration,” predicts Randy Komisar of Kleiner Perkins, a venture-capital firm. [The Economist, Sep 1, 18] Beware predictions where money, ideas, and technology meet.
scientists are rotten forecasters—almost as bad as economists [Andrew Robinson reviewing Martin Rees new book, Science, Sep 14, 18]
Quantum machine learning is a big leap away, at least for now, according to a panel of quantum computing experts from IBM and MIT. Participants included Peter Shor, the man behind the most famous quantum algorithm. ... while quantum computers are scaling up, years here, before they could do any useful machine learning, partly because a lot of extra qubits will be needed to do the necessary error corrections. [Will Knight, MIT Tech Rvw, Oct 3, 18]
Frances Arnold, a Caltech professor who serves on the board of directors of Illumina, has been chosen to share this year’s Nobel Prize in chemistry. [Gary Robbins and Bradley J. Fikes, San Diego Union Tribune, Oct 4, 18]
Reverting to mean. Trade tensions may be taking a toll on capex plans. The housing market is soft. “It is beginning to look like the bloom is coming off the economic rose,” said Naroff Economic Advisers's Joel Naroff. [Real Time Economics, Wall Street Journal, Sep 28, 18] But probably not noticed until after the next partisan-warfare election.
2008 Redux? Ten years after the Great Recession’s onset, another long, deep downturn may soon roil the U.S. economy. The high level of asset prices today mirrors the earlier trend in house prices that preceded the 2008 crash; both mispricings reflect long periods of very low real interest rates caused by Federal Reserve policy. Now that interest rates are rising, equity prices will fall, dragging down household wealth, consumer spending and economic activity. [Martin Feldstein, Wall Street Journal, Sep 27, 18]
Immigrants help labor markets. We find that all types of immigrants generate higher surplus for US firms relative to natives, hence restricting their entry has a depressing effect on job creation and, in turn, on native labor markets. We also show that substituting a family-based entry with an employment-based entry system, and maintaining the total inflow of immigrants unchanged, job creation and natives' income increase. [Andri Chassamboulli and Giovanni Peri, NBER Working Paper No. 25074 Issued in September 2018]
Efficiency matters. Chinese businesses use roughly two times more capital and five times more labor than U.S. companies to generate the same level of output. More than one-third of China’s industrial capacity is wasted. More than half of its R&D spending is stolen. Nearly two-thirds of its infrastructure projects cost more to build than they will ever generate in economic returns. [Michael Beckley, Foreign Affairs, Sep 19, 18]
Who starts businesses? The best business people aren't always the ones who start a business. "For example, subsidies for small businesses do not attract talented-but-reluctant entrepreneurs, but instead attract individuals with personality traits associated with strong preferences for running a business and low-quality business ideas," Barton Hamilton, Nicholas Papageorge and Nidhi Pande write in a National Bureau of Economic Research working paper. [Jeff Sparshott, Wall Street Journal, Sep 17,18]
Universplaining. the ‘anthropic principle’, a kind of Goldilocks phenomenon or ‘intelligent design’ for the whole Universe. It’s easy to describe, but difficult to categorise: it might be a scientific question, a philosophical concept, a religious argument – or some combination. The anthropic principle holds that if such phenomena as the gravitational constant, the exact electric charge on the proton, the mass of electrons and neutrons, and a number of other deep characteristics of the Universe differed at all, human life would be impossible. According to its proponents, the Universe is fine-tuned for human life. [David P Barash, Aeon, Sep 17, 18]
Not the American way. The most desirable way to reduce debt is through growth, and countries should take advantage of periods of relatively stronger growth to reduce debt. This of course is the opposite of the current approach in the US.” [Carmen Reinhardt, Fiscal Times, Sep 14, 18]
Slowly, carefully. U.S. companies have moved cautiously in repatriating profits stockpiled overseas in response to last year’s tax-law rewrite, after the Trump administration’s assertions that trillions of dollars would come home quickly and supercharge the domestic economy. ... More than a dozen large companies, including General Electric Co. and Boston Scientific Corp. , have said they don’t need past foreign earnings in the U.S. or have no immediate plans to bring cash home. Far more are waiting or won’t say. [Richard Rubin and Theo Francis,Wall Street Journal, Sep 16, 18] Political system more volatile than expected with supremely volatile President? The politically promsed vast new investment and good US jobs isn't even half-vast.
Competition. Chinese group grabs north San Jose site, eyes innovation center - Hangzhou Silicon Valley Innovation Center has bought a two story building, which is near the corner of East Tasman Drive and Baypointe Parkway, for $41.5 million in cash this week, Santa Clara County property records show. [San Jose Mercury News, Sep 12, 18]
American companies [particularly Apple] are borrowing money to buy their own shares in what is tantamount to a huge, slow-motion leveraged buyout. ... In some cases, they have done so simply to push up share prices so that management can meet goals for quarterly earnings or metrics that trigger compensation. [Mihir A. Desai, New York Times, Aug 6, 18]
“The rate of profit...is always highest in the countries which are going fastest to ruin,” [Smith] argued. America’s corporate-profit rate is currently at historical highs. Had regulators read more Smith, the American economy might be in better shape. [The Economist reviewing Jesse Norman's biography of Adam Smith, [Jul 28, 18]
Trees don't grow to the sky. Investors dumped Facebook shares after the company reported a sharp slowdown in sales growth in coming quarters along with rising spending on security and privacy enhancements. ... Before Facebook’s tumble, more than half the returns in the Standard & Poor’s 500-stock index this year had been provided by just a handful of technology-related stocks, said Savita Subramanian, an equity strategist at Bank of America Merrill Lynch. [Matt Phillips, New York Times, Jul 26, 18]
Seeking foreign investors? This year, net inward investment into the United States by multinational corporations—both foreign and American—has fallen almost to zero, an early indicator of the damage being done by the Trump administration’s trade conflicts and its arbitrary bullying of companies and governments. [Adam Posen, Foreign Affairs, Jul 26, 18] Welcome to America Alone.
Strategic wasteland. Scott Irwin, an agricultural economist at the University of Illinois, [Politico’s Catherine Boudreau] says that “farmers’ biggest fear is this could put the United States in the category of an unreliable supplier,” which could make it hard to recover lost customers. “We’ve put a lot of time, effort and energy into building markets like China,” said Stuart Woolf, a farmer in California. “We’re constantly trying to build trust with our strategic partners. With this administration, there doesn’t seem to be any strategic partners,” Woolf added. [Yuval Rosenberg and Michael Rainey, Fiscal Times, Jul 27, 18] The likely winner in the soybean tariff war: Brazil.
Productivity myth. Popular though the stealth productivity boom is, it is a myth. A new study finds that official statistics do tend to understate productivity, but by less than two decades ago. So even if all the benefits of social networks, online shopping and less invasive surgery were being measured, it probably wouldn’t change the overall picture: Productivity growth is historically slow. The study is by the Hutchins Center on Fiscal and Monetary Policy at the Brookings Institution. [Greg Ip, Wall Street Journal, Jul 25, 18]
Investors have pushed U.S. small-cap stocks to record highs while seeking a haven from tariff-related tensions, but the popular trade is beginning to appear vulnerable. ... the Russell 2000, an index that tracks shares of smaller companies, up 11% this year, compared with the S&P 500’s 4.8% gain. ... Russell 2000 is trading at a forward price-to-earnings ratio of 22.4 as of Thursday, compared with the S&P 500’s 16.6 [Danielle Chemtob, Wall Street Journal, Jul 23. 18]
Biotech stocks are hot tickets once again on Wall Street and that is bringing a wave of initial public offerings. The risk is the high demand for these companies is offset by a wave of new supply. [Charley Grant, Wall Street Journal, Jul 18, 18]
The world's second biggest private funder of medical research, the London-based charity Wellcome Trust, announced it will provide £250 million [the Wellcome Leap Fund] for unconventional research that could transform science or health. ... earmarked for ideas shut out from traditional funding because they are less likely to succeed, and for projects with researchers who lack a background in the life sciences but bring other expertise. .. first research programs could start in late 2020. [Science, Jul 13, 18]
While top companies are getting more productive, gains are stalling for everyone else. And the gap between the two is widening .... Since the 2008 financial crisis, U.S. productivity has grown by about 1.2% a year. half the rate it clocked in the 1970s and around one-third of what it was in the decades after World War II, once adjusted to strip out the temporary effects of economic booms and busts. [Jason Douglas, Jon Sindreu and Georgi Kantchev, Wall Street Journal, Jul 15, 18] The economic effects of the 2008 crash caused the political revolt that got Trump elected, who the economists would also say has no workable solution, including "America Alone".
Carelessly Unintended Consequences. Profits are soaring, but paychecks are stagnant. Companies complain about a shortage of workers, but they seem reluctant to raise wages. A sinking nationwide unemployment rate masks many of the struggles workers face: Hourly earnings have moved forward at a crawl, with higher prices giving workers less buying power than they had last summer. Unions are weakening, and companies have the ability to look for cheaper workers overseas. [JOUMANA KHATIB AND LANCE BOOTH, New York Times, Jul 13, 18] Maybe the deplorables will discover the obvious - only the rich matter.
Innovative muscles. He snipped a tiny piece of muscle from the baby’s abdomen. Dr. McCully grabbed it and raced down the hall. Twenty minutes later, he was back with a test tube of the precious mitochondria. Dr. Emani used an echocardiogram to determine where to inject them. He injected a billion mitochondria, in about a quarter of a teaspoon of fluid. Within two days, the baby had a normal heart, strong and beating quickly. ... The baby had had a heart attack, [at Massachusetts General Hospital] most likely while she was still in the womb. Her heart was profoundly damaged; a large portion of the muscle was dead, or nearly so, leading to the cardiac arrest. [Gina Kolata, New York Times, Jul 9, 18]
Microsoft is setting up an [medical] innovation hub in Durham's Chesterfield building so its scientists and Duke University's can work together. [Raleigh News & Observer, Jul 9 18]
Euler could write a momentous math paper in the 30 minutes between the first and second calls to dinner, According to the slightly hyperbolic account of the mathematical historian Eric Temple Bell. [Wall Street Journal, Jun 11, 18]
Over the past few decades there have been troubling indications that dynamism and competition in the U.S. economy have declined. .... Fact 5: The investment rate has fallen by more than one-third since the early 1960s. .... Fact 9: Start-up rates are declining across all sectors. .... Fact 10: The employment share of young firms has decreased by more than one-third since 1987. ... Fact 12: The entrepreneurship rate has fallen by almost half for workers with a bachelor’s degree. [Jay Shambaugh, Ryan Nunn, Audrey Breitwieser, and Patrick Liu Brookings, June 13, 18] Read the Report. Did SBIR achieve any of its goal of more innovation and permanent new businesses? Who knows, since there is no control group for comparison and no political interest in discovering the answer anyway.
The behemoths’ annual conferences, held to announce new tools, features, and acquisitions, always “send shock waves of fear through entrepreneurs”, says Mike Driscoll, a partner at Data Collective, an investment firm. “Venture capitalists attend to see which of their companies are going to get killed next.” [The Economist, Jun 2, 18]
The U.S. had more job openings than unemployed Americans this spring. That's the first time that's happened since such record-keeping began in 2000, Eric Morath reports. [Jeff Sparshott, WSJ, Jun 5, 18]
U.S. companies are ramping up spending on their businesses at the fastest pace in years, a long-awaited development after years of tepid growth. Spending on factories, equipment and other capital goods by companies in the S&P 500 is expected to have risen to $166 billion in the first quarter, up 24% from a year earlier, according to Credit Suisse data going back to 1995. [Akane Otani, Ben Eisen and Chelsey Dulaney, Wall Street Journal, May 15, 18]
Apple gave its shareholders a lot to smile about Tuesday by launching a new, $100 billion stock-buyback plan, bigger dividends and strong quarterly earnings and sales. [bayareanewsgroup.com, May 1, 18] Where did the TaxCuts and Jobs windfall land? Did you believe the rosy scenarios of the legislators who paid off their sponsors and their President?
Big Pharma bosses say they are willing to invest for the long run. That means high prices for promising biotech stocks aren’t likely to fall any time soon. [Charley Grant, Wall Street Journal, May 1, 18]
as one Chinese expert put it, “No one can contain China anymore.” You hear that confidence in Beijing a lot today from Chinese: Our one-party system and unified society can take the pain of a trade war far longer than you Americans can. And there is a trade imbalance today because we’ve been investing in our future and you Americans have been eating yours. ... What’s being written is the first page of a whole new chapter in the history of U.S.-China relations. [Tom Friedman, New York Times, May 1, 18]
America's startup scene just ain't what it used to be. During the latest economic expansion, new establishments have accounted for a little more than 11% of all new private-sector jobs created in the U.S. During the 1990s, the figure was 15%. Those few percentage points are the equivalent of hundreds of thousands of jobs per quarter. The startup slowdown also suggests a loss of dynamism across the broader U.S. economy, with Americans either less willing or less able to launch a new venture, and a decline in the kind of churn that leads to greater opportunity for workers and rising productivity. [Jeff Sparshott, Wall Street Journal, Apr 26, 18]
Mandatory honors. China’s legislature is set to pass a new law that requires “all of society” to “honor, study and defend” Communist Party-approved heroes and martyrs, and will subject anyone who defames members of that select group to potential criminal penalties and civil liabilities. [Wall Street Journal, Apr 26, 18]
Oxford University researchers Carl Frey and Michael Osborne claim that technology will transform many sectors of life. They studied 702 occupational groupings and found that “47 percent of U.S. workers have a high probability of seeing their jobs automated over the next 20 years.” .... If the employment impact falls at the 38 percent mean of these forecasts, Western democracies likely could resort to authoritarianism [Trumpism on steroids] as happened in some countries during the Great Depression of the 1930s in order to keep their restive populations in check. [Darrell West, Brookings, Apr 18, 18] Beware the cries of efficiency in service to profits. Capitalism is after all an economic, not a political, system and cannot be the ultimate determinant of societal organization.No matter how many Koch brothers lavish money on politics.
As production is mechanised, and the profit margin of the machine-owners becomes our civilisation’s driving motive, society splits between non-working shareholders and non-owner wage-workers. As for the middle class, it is the dinosaur in the room, set for extinction. [Yanis Varoufakis, The Guardian, Apr 18, 18]
Smaller slice of bigger pie. America’s share of global wealth is shrinking. By some estimates, the United States accounted for roughly 50 percent of global output at the end of World War II. By 1985, its share stood at 22.5 percent. It has fallen to 15.1 percent today, and the International Monetary Fund projects that it will slip to 13.7 percent by 2023. [Christopher A. Preble, New York Times, Apr 21, 18]
researchers in Singapore [Nanyang Technological University] say they have trained [a robot] to perform another task known to confound humans: how to assemble furniture from Ikea. [Niraj Chokshi, New York Times, Apr 18, 18] Need an example of a huge economic success with a huge dose of government oversight and no natural resources, even water? Singapore. And the weather is the same every day.
Bigger world pie, smaller US slice. while overall investment is on the rise, the U.S.’ share is dwindling. A few years ago, North American startups reliably received at least two-thirds of global early-stage investment. No more. For the past three quarters, North America’s share has dwindled to less than half, .... The rise of China’s startup scene, combined with local investors’ penchant for jumbo-sized Series A rounds, goes a long way to explaining the shift .... Purely following the money, the takeaway is this: Investors globally have decided the early-stage opportunity is a lot bigger than they thought a couple of years ago. [Investors] are putting a lot more into China and other regions with underdeveloped venture markets relative to their size and technology prowess. [Joanna Glasner, Tech Crunch, Apr 16, 18]
Among President Trump’s most deeply held economic convictions is that
trade deficits are bad, yet his signature economic policy—a major tax
cut—likely will deepen the trade deficits he abhors, Greg Ip writes.
But in the long run wider trade deficits will make Americans poorer. That’s not because foreigners are stealing American jobs, as Mr. Trump often contends. Rather, it’s because Americans will increasingly borrow from foreigners to sustain their standard of living. Paying them back will wipe out a sizable chunk of the tax cut’s benefit. [Jeff Sparshott, Wall Street Journal, Apr 17, 18]
Taiwan TSMC tops Intel. TSMC’s latest fab will cost $20bn. The Taiwanese company pioneered this model and is its dominant exponent. In 2017 it had 56% of the foundry market, according to Trendforce. ... Intel currently makes chips using a ten-nanometre (billionth of a metre) node. TSMC’s new ones are made with a seven-nanometre node. [The Economist, Apr 7, 18]
Researchers at [startup] Oxis Energy (UK) are building batteries with a combination of lithium and sulfur that store nearly twice as much energy per kilogram as the lithium-ion batteries in electric cars today. ... but conking out after 100 or so charging cycles [Robert Service, Science, Mar 9, 18]
Cash-out time. Mr. Pressman and many other Silicon Valley venture capitalists expect the [IPO] windfalls to continue. Many of these investors, who back tiny start-ups with the hope that they will someday go public or be sold for nine- or 10-figure sums, have enjoyed enormous paper gains in recent years. But few have cashed in, because their fast-rising companies, like Uber and Airbnb, have remained private. [Jack Nicas, New York Times, Apr 15, 18] looking for the 40%pa ROI of the dot-com 1990s. Note that Trump's trade war will inhibit Chinese money flow into US companies as the two countries' leaders look inward for their political support.
SenseTime, an AI-powered facial recognition firm, has broken funding records. The news: Bloomberg says SenseTime raised $600 million from Alibaba and other investors at a valuation of over $3B, making it the world’s most valuable AI startup. I spy money: SenseTime tech helps power China’s massive surveillance systems. It will use some of the cash to build supercomputers to track thousands of feeds. It will also hire more AI talent, and make a push into autonomous driving and AR. [Tech Review, Apr 9, 18] China already claims the world's largest supercomputer in its National Supercomputing Center in Tianjing (population 17M)
More startups are being formed at Illinois universities than ever before, and those entrepreneurs are becoming more likely to remain in-state after they graduate. That’s according to a new report from the Illinois Science and Technology Coalition, non-profit that aims to measure and strengthen the state’s innovation economy. ... over the last five years, students and faculty at Illinois universities founded 942 startups, ... more than double the amount of startups that were formed in the state during the previous five-years from 2009-2013. ... Of those 942 startups, 74 percent are still active and 1 percent have been acquired. Local university startups raised $877.5 million during the past five years [Jim Dallke, Chicago Inno, Apr 4, 18]
Home cooking tastes best. with Chinese firms spending huge money on automation technology, the central government has sought to spur native development and keep as much of that spending onshore as possible. ... If Geek+ is any indication, native robotics companies are ascendant, which means the Chinese gravy train could be coming to a screeching halt for outsiders. [By Greg Nichols for Robotics, Apr 5, 18] Beijing does not have to placate local politicians and campaign contributors in deciding and executing its plans. On the other hand, it does not get feedback from interested parties.
Burton Smith, co-founder (with late Seymour Cray) of supercomputing company Cray, died this week at 77. [Seattle Times, Apr 5, 18]
the choice in some jobs will be between being replaced by a robot or being treated like one. [The Economist, Mar 30, 18]
Welcome to Day 1 of the Wisconsin Inno Beat. This is our twice-a-week newsletter where we'll break down all the news you need to know on the Wisconsin tech and startup scene. InnoBeat is a new source of what's happening with startups. of course it is filled with startups whose one question is will anyone buy the product. High risk, high imppact startups will still depend heavily on government programs like SBIR and DARPA.
Need cobalt, pay up. half of the world’s cobalt reserves and production are in dangerously unstable Congo, and four-fifths of the cobalt sulphates and oxides used to make the all-important cathodes for lithium-ion batteries are refined in China. ... price of cobalt up from an average of $26,500 a tonne in 2016 to above $90,000 a tonne. [The Economist, Mar 22, 18] As China tunes up for electric car production.
Business itself may be a matter of hard numbers, but business commentary is often a thing of soaring ideological fancy. So the old shell game plays out once more. In, 2016 millions of average Americans enthusiastically signed up for a war on elites; with boisterous hurrahs they climbed aboard the Trump train; and after a few years’ journey they are going to find themselves deposited right back where they started, with inequality growing, more monopolies springing up, and Wall Street ideologues running everything. [Thomas Frank, The Guardian, Mar 25, 18]
Cambridge [MA] Innovation Center announced that it has closed a $58 Million equity investment from European partner HB Reavis .... to expand its network of science and technology innovation campuses throughout the world. [Center press release, Mar 19, 18]
last year the World Economic Forum reported that China had 4.6m recent graduates in science, technology, engineering and mathematics (the vast majority of them engineers). America, with a quarter of China’s population, has about an eighth of that number. [The Economist, Mar 16, 18]
Arizona State University’s Biodesign Institute is spinning out a company, which has yet to be named, that makes a nanorobot using DNA to kill cancerous tumors by cutting off their blood supply. [Phoenix Business Journal., Mar 1, 18]
Minnesota nice. Tech economies are accelerating faster [in the Midwest], 7% of national VC up from 4% in 2002, and $5B cashout in 2017, triple 2016. [Victor Gutwein, MinnieInno. Mar 6, 18]
Best snow living. U.S. News & World Report revealed its list of the top 100 places to live in the United States. Among the 100 metropolitan areas, four cities in Upstate New York ranked in the top 60. Albany, Syracuse, Buffalo, and Rochester. [Alexi McCammond, newyorkupstate.com, Mar 2, 18] Until the end of WW II, these snowy cities were prime industrial centers in the US's most populous state. All were extremely well served by the Erie Canal and the New York Central RR mainline from NYC to Chicago.
Everyman an island? Whereas the products of giant factories were once giant things used to make the giant items that worked to bring people together physically — bridges, skyscrapers, trains, automobiles — they now operate in a world increasingly focused on the miniature, the micro, the interior. [Scott Berg, reviewng Joshua Freeman's Behemoth, Washington Post, Mar 4, 18]
TiE Atlanta, the local chapter of non-profit entrepreneurship organization TiE Global, announced it has launched TiE Angels, a new angel group committed to supporting startups at the seed and Series A stages. According to the organization, TiE Angels is looking for companies that have already raised at least 50 percent of a current round targeted between $250K to $2M, with an accredited lead investor attached to the investment. [Will Flanagan, Atlanta Inno, Feb 27, 18]
manufacturing now accounts for just 8% of the American workforce, but world-wide the figure is about 30%, as high as it has ever been. [Jonathan Rose reviewing Joshua Freeeman's Behemoth that walks us through a world history of industrial capitalism and industrial communism. Wall Street Journal, Feb 23, 18]
A myth of the past. we’re all aware of the gloomy statistics around wage stagnation and income inequality, but [Harvard prof Stephen] Pinker contends that we should not be nostalgic for the economy of the 1950s, when jobs were plentiful and unions strong. A third of American children lived in poverty. Sixty percent of seniors had incomes below $1,000 a year. Only half the population had any savings in the bank at all. ... Now Half of all Americans wind up in the top 10 percent of earners at least one point in their career. [David Brooks, NY Times, Feb 22, 18] Brooks goes on to complain of our social disconnecteness which we did not have in the 1950s.
Rare disease biopharma Shire has kick-started a new mandatory open-access program for research manuscripts to journals it has funded. [Ben Adams, Fierce Biotech, Jan 24, 18]
Think urban future. Since 2010, the 53 largest U.S. metropolitan areas have accounted for 93 percent of the nation’s population growth, 73 percent of its employment gains, and two-thirds of its economic output—all while smaller communities lose ground. [Mark Muro and Jacob Whiton, Brookings, Jan 24, 18] That heavy traffic and expensive living contain the skills and ideas you need.
[German] Scientists have developed a tiny robot that can walk, roll, jump, swim and even transport minuscule cargo, in a step toward eventually putting robots to work inside the human body. The robot, a rectangular sheet approximately four millimeters long and one millimeter wide, is made of silicone rubber and embedded with magnetic particles. [Sarah Toy, Wall Street Journal, Jan 24, 18]
Pioneer Square Labs has raised $15 million from investors to keep its Seattle startup factory churning: coming up with ideas for new companies, finding entrepreneurs to lead them and launching new businesses. ... formed in 2015 by several prominent local venture capital investors [Rachel Lerman, Seattle Times, Jan 18, 18]
UC San Diego-led researchers have developed cancer-killing immune cells activated by ultrasound. Their work in cell cultures could lead to more precise cancer treatment with fewer side effects. Cells can be activated at up to 10 centimeters (nearly 4 inches), reaching deep with the body. The ultrasound method could be applied to other biological functions, either for research or clinical applications. .... The study was published [Jan 15] in the Proceedings of the National Academy of Sciences. It can be found at j.mp/ultracartcells. [Bradley Fikes, San Diego Union Tribune, Jan 17, 18]
Home for heart and money. U.S.-trained Chinese-born talent is becoming a key force in driving Chinese companies’ global expansion and the country’s efforts to dominate next-generation technologies like artificial intelligence and machine learning. Where college graduates once coveted a prestigious overseas job and foreign citizenship, many today gravitate toward career opportunities at home, where venture capital is now plentiful and the government dangles financial incentives for cutting-edge research. [Bloomberg, Jun 10, 18] The Chinese are growing as economic competitors, especially costly in an "America first" world. The Chinese immigrants will get the steady drumbeat of "we good, they bad".
China’s research-focussed biotech company KBP Biosciences closed a $76 million [multinational] Series A financing according to a statement. ... targets unmet medical needs in cardiovascular, infectious disease, respiratory, inflammatory and autoimmune diseases. ... will fund the expansion of business operations and operational structure of the firm, including the opening of global corporate headquarters in the Greater Philadelphia Area. This will advance the clinical development of its lead candidate KBP-5074, a mineralocorticoid receptor antagonist for cardiovascular disease entering Phase 2b; and to support other promising programs in the pipeline. [Shiwen Yap, Deal Street Asia, January 8,2018]
Clear the technological barrier, and another one looms. The brain is still a foreign country. Scientists know little about how exactly it works, especially when it comes to complex functions like memory formation. ... experiments on humans are hard. Yet, even today, some parts of the brain, like the motor cortex, are better understood. Nor is complete knowledge always needed. Machine learning can recognise patterns of neural activity; the brain itself gets the hang of controlling BCIS with extraordinary ease. And neurotechnology will reveal more of the brain’s secrets. [The Economist, Jan 9, 18]
Japan, Greece, Italy, Portugal are the only countries with
debt higher than the US as a percentage of GDP. [Josh
WSJ, Jan 2, 18] and US is programmed to add $1T federal debt in the
decade from its celebrated taxcuts. Politics just cannot
sending its expenses to the future.
----------------------------------------------------- 2018 ---------------------------------------------
----------------------------------------------------- 2017 ---------------------------------------------
It takes a long time. For all of today’s technological advances, from artificial intelligence to robotics, there is no sign of an impact on wages or productivity. .... The integrated circuit was commercialized in the 1960s yet 25 years later computers still represented just 5% of the value of all business equipment. Indeed, since the introduction of computers labor productivity has behaved much as it did after the introduction of electric motors and the internal combustion engine. [Greg Ip, Wall Street Journal, Dec 28, 17] Two recent analysis of tech growth: a recent paper Erik Brynjolfsson and Daniel Rock of the Massachusetts Institute of Technology and Chad Syverson of the University of Chicago Artificial Intelligence and the Modern Productivity Paradox: A Clash of Expectations and Statistics, NBER Working Paper No. 24001, and Northwestern U's economist Robert Gordon's The Rise and Fall of American Growth: The U.S. Standard of Living since the Civil War
Where's the action? “The hinterland for Silicon Valley is Shenzhen,” said Timothy Sturgeon, a senior researcher at the M.I.T. Industrial Performance Center. ... The rest of the country may receive the innovations that flow out of global cities, and the benefits to consumers are real. “But by the time that’s done, the cities have already invented something new and made themselves richer again,” Mr. Storper said. “Before anywhere else can catch up, San Francisco has already leapt ahead again with new stuff they’ve invented.” [Emily Badger, New York Times, Dec 24, 17] Those smaller places must rely on their policians to push economic activity their way with government programs. For that they will need to put a lot of Democrats in Congress. Otherwise, the biggest donors from the biggest cities will collar the biggest rewards and control.
In 1769 Matthew Boulton wrote to his partner James Watt: ‘It is not worth my while to manufacture [your engine] for three counties only; but I find it very well worth my while to make it for all the world.’ [Joel Mokyr, Aeon, Dec 20, 17]
Intel CEO Brian Krzanich told employees that the company will take more risks going forward and he said change will be the "new normal." In an internal memo that was sent to CNBC, Krzanich acknowledged "innovation" inside Intel's client computing business – its biggest segment – but said the biggest opportunities are in the company's growth areas like connected devices, artificial intelligence and autonomous driving. [CNBC, Dec 19, 17]
Researchers at Rigetti Computing have shown that they can run a machine-learning technique known as clustering, which organizes data into similar groups, using their prototype quantum chips. That sounds like a hell of a lot of buzzwords, and, sure, it doesn’t mean that all AI is about to go quantum right away. But, as our own Will Knight writes, the approach could go on to transform machine learning. [technologyreview.com, Dec 19, 17]
Beware of economists. The danger is that it is much easier, and often more lucrative, to sound like an economist than to be a good one. You can’t pull the same trick in, say, neurosurgery. Thus the world is full of bad economists making finger-in-the-air claims about the likely direction of the markets and the efficiency, or not, of free markets, or making politically motivated arguments that have more to do with their ambition to serve in some White House advisory capacity than with empirical fact. [Philip Delves Broughton reviewing Jean Tirole's Economics for the Common Good, Wall Street Journal, Dec 18, 17]
AMR Centre (UK) has partnered with the Skolkovo Foundation in Russia to accelerate the development of new tests and therapies for antimicrobial resistance, the organizations announced this week. ... Established last year, the AMRC is a private-public initiative aimed at supporting new antibiotics and tests by offering partners access to translational R&D resources. Since commencing operations in July, it has been keen to reach out to partners, especially in the so-called BRICS countries, Brazil, Russia, India, China, and South Africa. .... Established in 2010, the Skolkovo Foundation oversees the Skolkovo Innovation Center, a technopark located outside Moscow that hosts more than a thousand technology companies and startups. [360dx.com, Dec 14, 17]
Two-thirds of people surveyed last year in 28 countries for the 2017 Edelman Trust Barometer expressed low levels of trust in “mainstream institutions” of business, government, media and nongovernmental organizations. ... Botsman warns, “Today China, tomorrow a place near you.” Already companies across the democratic world are creating systems through which individuals are rated for various behaviors and characteristics. [Rebecca MacKinnon, reviewing Rachel Botsman 's wHO cAN yOU tRUST? How Technology Brought Us Together and Why It Might Drive Us Apart, WashPo, Dec 7, 17]
Really big batteries. “The storage battery is, in my opinion, a catchpenny, a sensation, a mechanism for swindling the public by stock companies,” wrote Thomas Edison in 1883. Today, the battery industry is mustering for exponential growth as car makers electrify their fleets, most visibly at Tesla ’s $5 billion factory in Nevada. ... The industry will need to increase production from 68 gigawatt-hours of lithium-ion cells last year to 1,165 GWh over the next decade, estimates brokerage Berenberg. [Steven Wilmot, Wall Street Journal, Dec 4, 17]
Despite concern that America’s entrepreneurial engine is severely damaged, new research from the Information Technology and Innovation Foundation (ITIF) finds that the number of technology-based startups has grown by 47 percent from 2007 to 2016, with wage growth higher than the national average. Because of their high growth potential, the authors suggest that technology-based startups should be the primary focus of entrepreneurship policy. To bolster these types of entrepreneurs, the authors propose recommendations across four main areas: tax reform, regulatory reform, STEM skills, and technology transfer ... In How Technology-Based Start-Ups Support U.S. Economic Growth, authors John Wu and Rob Atkinson distinguish between typical startups and their technology-based counterparts [SSTI, Nov 29, 17] Among the recommendations: Congress should develop a proof- of-concept, or “Phase Zero,” individual and institutional grant award program within major federal research agencies. SBIR and STTR approval processes are high bars to clear for very early - stage companies. Unfortunately for the prospects of better support for tech start-ups, the federal agencies test most SBIR proposals against standards meant for mature contractors. The wild-eyed innovator has to compete with companies with tens of millions of SBIR dollars already with "proven records of success." But Congress has neither the time nor the interest for perfecting innovation programs . So, they throw a little money at the problem and hope for the best.
Robots could take 800 million jobs globally by 2030. But [not] evenly. So says a McKinsey Global Institute study (PDF), which predicts shifting labor demand as a result of new tech. It predicts rich nations like America will find 25 percent of work automated by then, while poorer ones, like India, will see as little as 9 percent taken up by machines. New jobs will be created, but 375 million people will be forced to find totally different occupations—and, as we've reported, they will likely require more tech savvy than many workers have. [technologyreview.com, Nov 29, 17]
Samsung made a graphene cathode it says gives li-ion batteries 45 percent more capacity and five times the charging speed. ... A full-cell incorporating graphene balls increases the volumetric energy density by 27.6% compared to a control cell without graphene balls, showing the possibility of achieving 800 Wh L−1 in a commercial cell setting, along with a high cyclability of 78.6% capacity retention after 500 cycles at 5C and 60 °C. [In Hyuk Son et al, Nature Communications 8, Nov 16, 17]
Seeking innovtion in story telling? See Dan Stevens as 1843 Charles Dickens inventing Ebenezer Scrooge in The Man Who Invented Christmas in six weeks before Christmas. Every copy of the book was sold out in a few days before Christmas.
A team of scientists at Yale has developed an alternative gene-editing technology that they say replaces CRISPR’s “hacksaw” effect with a more precise “scalpel.” They call it eukaryotic multiplex genome engineering (eMAGE), and it’s designed to to allow new genetic information to be inserted into DNA without requiring multiple double-strand breaks. They described the technology in the journal Cell. [Arlene Weintraub, Fierce Biotech, Nov 17, 17]
Hotter AI abroad.
trio of new investments in Silicon Valley machine-learning startups
shows that the U.S. intelligence community is deeply interested in
artificial intelligence. But China is investing even more in these
kinds of U.S. companies, and that has experts and intelligence
officials worried. ... “The entire government spent $1.1
on unclassified AI programs in 2015. The estimate for 2016 was $1.2
billion,” said [Charlie Greenbacker, In-Q-Tel’s
technical product leader in artificial intelligence, machine learning,
natural language processing, analytics, and data science]
[a Japanese multinational conglomerate] has a $100-billion-dollar fund
for this. The Chinese government in their most recent five-year-plan
has put $150 billion in this.” [Patrick Tucker,
Defense One, Nov 13, 17]
Three prominent tech thinkers recently declared the end of the startup era, questioned the future of tech innovation generally and heralded the rise of the “Frightful Five” — Apple, Amazon, Facebook, Google and Microsoft — who will dominate the future of tech. All of the posts make credible arguments, but ignore how consolidation could be good, even great, for startups. .... If we define success as building an ever wider assortment of products, shipping them to tens of millions of users and earning hundreds of millions, or even billions of dollars in short time frames, the good times may just be getting started. [Joseph Flaherty, techcrunch.com, Nov 6, 17] There is still a deep pool of capital sloshing around the world looking for profitable opportunity.
The flood of cash into startups has allowed companies to stay private for far longer than in the past. On the positive side, companies have more time to develop and grow. But the lack of a public market valuation also raises the question of whether many companies are worth the $1 billion-plus values private investors have attached to them. [Justin Lahart, Wall Street Journal, Oct 30, 17]
The technology industry is now a playground for giants. ... The best start-ups keep being scooped up by the big guys (see Instagram and WhatsApp, owned by Facebook). Those that escape face merciless, sometimes unfair competition (their innovations copied, their projects litigated against). .... The Five run server clouds, app stores, ad networks and venture firms, altars to which the smaller guys must pay a sizable tax just for existing. For the Five, the start-up economy has turned into a heads-I-win-tails-you-lose proposition — they love start-ups, but in the same way that orcas love baby seals. [Farhad Manjoo, NY Times, Oct 18, 17]
How to succeed in science without really trying. [China] now has more laboratory scientists than any other country, outspends the entire European Union on research and development, and produces more scientific articles than any other nation except the United States. ... but a recent string of high-profile scandals over questionable or discredited research has driven home the point in China that to become a scientific superpower, it must first overcome a festering problem of systemic fraud. .... a government investigation highlighted the existence of a thriving online black market that sells everything from positive peer reviews to entire research articles. .... A search for the term “help publishing papers” on Taobao, a popular Chinese e-commerce site, yielded a long list of sellers who offered services ranging from faked peer reviews to entire scientific papers already written and ready to submit. [Amy Qin, New York Times, Oct 13, 17]
Immunotherapy worked. The science of using immunotherapy to treat cancer is advancing rapidly, marked by the National Cancer Institute’s recent disclosure that a metastatic breast-cancer patient is now cancer-free, regulators’ expected approval of a major lymphoma treatment this fall and the unveiling Thursday of a partnership between government researchers and drugmakers. [Thomas Burton, Wall Street Journal, Oct 12, 17]
companies are investing less in the U.S. than at the peak of every economic cycle since the mid-1970s ... Low [interest] rates tell chief executives that the economic outlook is grim .... investors discouraged from saving have sent a clear signal to CEOs, pushing up the shares of companies that give cash back to shareholders via dividends and buybacks. CEOs who want to maximize their bonuses shouldn’t go on an investment splurge. .... China has been overinvesting and accepting a low return on capital; why would a U.S. company invest when China is willing to do it more cheaply on their behalf? American consumers get cheaper products, and China gets factories. [James Mackintosh, Wall Street Journal, Oct 9, 17] The future for capital investment? Your guess.
“We have a lot of businesses... I don’t think any of them are non-competitive in the world because of the corporate tax rate,” [Warren] Buffett, the chairman and CEO of Berkshire Hathaway, told CNBC
Discovery miracle sought. The kind of [energy tech] miracles that [Bill] Gates seeks [with $2billion] are not to be found in the corporate R&D departments of Google, GM, Apple, or Monsanto, nor in the R&D budget of the U.S. Department of Energy [because] they do not leap over the miracle hurdle Gates describes. .... Google is nearly nineteen years old. Bell Labs was just a dozen years old when one of its scientists was awarded the 1937 Nobel Prize in physics along with George Thomson for confirming experimentally Louis de Broglie’s wave–particle theory of matter. ... But there is no evidence that any corporation, much less any corporation in the high-tech sector, is interested in returning to anything like the Bell Labs model. .... Randy Schekman’s Nobel Prize-winning discovery emerged from work he did on how molecules in yeast proteins operate. in his Nobel banquet speech, Schekman said he and his team had “no notion of any practical application” and were driven entirely by curiosity. Yet their research ended up providing a roadmap for the biotechnology industry to manufacture “commercially useful quantities of human proteins” — an especially useful result when one considers that “one-third of the world’s supply of recombinant human insulin is produced in yeast.” [Mark Mills, New Atlantis, Spring 2017]
How many scientists? “It’s getting harder and harder to make new ideas, and the economy is more or less compensating for that,” Nicholas Bloom, one of the authors and an economics professor at Stanford University, tells Stanford Insights’s May Wong. “The only way we’ve been able to roughly maintain growth is to throw more and more scientists at it.” How many scientists? Well, consider Moore’s Law. Maintaining the theorem’s promised pace of innovation has required a research force 75 times larger than what was required in 1971, Ms. Wong writes. [Tom Loftus, Wall Street Journal, Sep 29, 17] Meanwhile The driving force is now an audacious, talented and globally minded generation of entrepreneurs. Investors are placing big bets on them. Around $77bn of venture-capital (VC) investment poured into Chinese firms from 2014 to 2016, up from $12bn between 2011 and 2013. Last year China led the world in financial-technology investments and is closing on America, the global pacesetter, in other sectors [The Economist, Sep 23, 17]
Less innovation for the money. across the economy as a whole, the notion that the cost of ideas is rising holds true. Since the 1930s, the effective number of researchers at work has increased by a factor of 23. But annual growth in productivity has declined [The Economist, Sep 30, 17]
Whether the information is true or concocted, authoritative reporting or conspiratorial opinion, doesn’t really seem to matter much to Facebook. The crowd gets what it wants and deserves. ... The whole [Facebook algorithmic] effort is to make human beings predictable – to anticipate their behaviour, which makes them easier to manipulate. [Franklin Foer, The Guardian, Sep 22, 17]
Entrepreneurs jumping the border. “Numerous startups in the tech hub of Toronto say they have had steady, double-digit increases in job applications from the United States since last year’s presidential election,” online news site Axios reported Sept. 20. [San Jose Mercury News, Sep 11, 17]
“We’re still in a start-up funk,” said Robert Litan, an economist and antitrust lawyer who has studied the [decline of startups] issue. ... Many economists say the answer could lie in the rising power of the biggest corporations, which they argue is stifling entrepreneurship by making it easier for incumbent businesses to swat away challengers — or else to swallow them before they become a serious threat. .... The newly formed Center for American Entrepreneurship will conduct research on the importance of new businesses to the economy and push for policies aimed at improving the start-up rate. Its founding president, John Dearie, comes from big business — he was most recently the acting head of the Financial Services Forum, which represents big financial institutions. [Ben Casselman, New York Times, Sep 20, 17]
Fatal Innovation. the French biotech firm Cellectis announced that its clinical trials involving genetically modified immune cells to treat two different types of cancer had been halted by the FDA after a patient was killed (Cellectis's stock took a beating on the announcement). The trials aimed to prove that a more advanced version of CAR-T, known as "off the shelf" or "universal" CAR-T, could work. The treatment tweaks T cells from a donor to turn them into cancer-killers and then infuses them into a patient. [Michael Reilly, technologyreview.com, Sep 6, 17]
Mr.[Greg] Ip is correct is saying we are asking the wrong thing from economists—that is, predictive solutions for an unknowable future. I liken this to our often blind faith in elite experts of every stripe to solve our problems for us. Thomas Sowell had the best answer for setting our expectations for economists when he sagely noted, “Economics is not about solutions; it is about trade-offs.” Overlaying all economic pronouncements with this insight would give everyone a more reliable model of how the world actually works. [Jack Lochrie, Farmington Hills, Mich, WSJ Sep 2, 17]. Unfortunately, politicians predict the future,usually as more of the present.
How little we know. There’s only one definitive statement to make about economic growth: We understand very little about why it occurs. To be sure, we don’t lack for theories. More than a few ideologues would have us believe that government can create dynamism at will, if only it would lower tax rates/raise tax rates/build more public works/cut social programs/return to the gold standard/increase spending on research. In truth, though, the forces that accelerate growth and raise incomes are not so easily managed. [Marc Levinson, reviewing Harford's Fifty Inventions that shaped the Modern Economy, WSJ, Aug 25, 17]
Antengene (China) has gained a healthy $21 million series A just a few months after setting up a deal with Celgene. [Ben Adams, Fierce Biotech, Aug 16, 17]
Entrepreneur Incentive. As the one-child generation enters the marriageable age, young men face a very competitive marriage market. In order to attract potential brides, families with sons choose to work harder, save more, and take on more risks, including exhibiting a higher propensity to be entrepreneurs (Wei and Zhang 2011a, b; Chang and Zhang 2015; Wei, Zhang, and Liu forthcoming). It is estimated that increasing marriage market competition due to sex ratio imbalances has contributed to about two percentage points of economic growth per year (Wei and Zhang 2011b) [Shang-Jin Wei, Zhuan Xie, and Xiaobo Zhang, Journal of Economic Perspectives, Winter 2017]
A California state senator says she will introduce legislation to clarify legal protections for entrepreneurs facing sexual harassment. State Sen. Hannah-Beth Jackson says the proposal, which she revealed, is in response to “recent and stunning” allegations by women entrepreneurs of harassment by venture capitalists. The proposal would amend California’s Unruh Civil Rights Act, ... would amend California’s Unruh Civil Rights Act, which prohibits sexual discrimination at California businesses, to clarify that it covers sexual harassment in relationships between entrepreneurs and potential investors. [Nitasha Tiku, wired.com., Aug 18, 17]
Venture Atlanta announced today that it will partner with Techstars Atlanta for its 10th Annual Venture Atlanta Conference Oct 11-12. With Cox Enterprises as the headline sponsor, the conference will incorporate the Techstars Atlanta Demo Day, featuring presentations from the program's 2017 class of 10 startups..... More than 900 tech enthusiasts, entrepreneurs, premiere investors and key executives from across the country are expected to join the 2017 Venture Atlanta Conference. This year, the event is particularly notable as it marks Venture Atlanta's 10-year anniversary. [cellular-news.com, Jul 27, 17]
America Has Lost a Monopoly on Top-Tier Tech Firms China’s Alibaba and Tencent have rocketed this year to become global investor darlings, inching up on Facebook and Amazon. [By PAUL MOZUR New York Times, Aug 17, 17] More world competition for the business of billions of non-Americans. Having the best tech is only a partial source of business volume and profit. The huge American home market that powered American companies' advantages in world competition since WW II is still huge but shrinking as a fraction of world markets.
Unwanted innovation. Danish drug giant Novo Nordisk is living through a corporate nightmare that any CEO might recognize from business school. After the company concentrated on making essentially one product [insulin] better and better—and charging more and more—customers have suddenly stopped paying for all that improvement. The established versions are, well, good enough. ... In Europe, the company had hoped to price Tresiba at 60%-70% higher than its previous product. ... Executives are scrambling to diversify—pouring money into research outside its core insulin-focused science. The company announced 1,000 job cuts last fall [Denise Roland, Wall Street Journal, Aug 15, 17]
Middle-aged capitalism. Consider: 1. Companies have gotten older. In 1975, the average publicly traded business was 10.9 years old. In 2015, the average was 18 years. The implication is that surviving firms either are more efficient or have stronger market positions in their industries. 2. the number of publicly traded companies has dropped sharply, from 7,002 in 1995 to 3,766 in 2015. The main cause, say Kahle and Stulz, is mergers. Small and medium-sized firms — many of them younger — prefer to sell out to larger corporations rather than compete as free-standing firms. 3. Companies are paying out record amounts to their shareholders, either as dividends or share buybacks. In 2015, nearly half of corporate profits (47 percent) were returned to shareholders, almost double the rate in 1975 (27 percent). This suggests that companies either lack attractive investment opportunities or are too risk-averse to take them. [Robert Samuelson, citing findings in Journal of Economic Perspectives by Kathleen M. Kahle of the University of Arizona and René M. Stulz of Ohio State University.]
A Cancer Conundrum: Too Many Drug Trials, Too Few Patients Breakthroughs in immunotherapy and a rush to develop profitable new treatments have brought a crush of clinical trials scrambling for patients. ... there are more than 1,000 immunotherapy trials underway, and the number keeps growing. “It’s hard to imagine we can support more than 1,000 studies,” said Dr. Daniel Chen, a vice president at Genentech, a biotechnology company. [GINA KOLATA, New York Times, Aug 12, 17]
Avoiding investment. The median firm in the S&P 500 holds 62 cents of cash on its balance-sheet per dollar of gross operating profit, up from 45 cents in 2006 (this yardstick excludes America’s giant technology companies, which hoard money). [The Economist, Aug 12, 17]
U.S. worker productivity picked up modestly in the second quarter but showed little sign of breaking out of the sluggish trend that has prevailed for more than a decade, holding back economic growth and living standards. [Wall Street Journal, Aug 9, 17]
Desperate economics. Foxconn (China) announced it will be building its first U.S. plant in the former manufacturing hub of Kenosha, WI [which will pay] almost a quarter-million per job, which will pay an average of $54,000 per year. ... It’s 50 times as much as the previous record-holder, the motor and engine company Mercury Marine. [Adam Golenbeck, realclearmarkest.com, Jul 25, 17]
China’s Next Target: The semiconductor industry, a stalwart of the global economy, is succumbing to fierce nationalistic competition, as China aims to dominate the market as it did with steel and solar panels. [Wall Street Journal, Jul 27,17]
Scientists go digital. As part of its shift toward high-tech businesses, the 125-year-old [General Electric] company is threading artificial intelligence throughout its operations, starting with its scientists. ... Part chemist, part data scientist, [PhD chemistry Jason] Nichols is now exactly the type of hybrid employee crucial to the future of a company working to inject artificial intelligence into its machines and industrial processes. ... Many of these dual scientists help make cloud-hosted software models of GE’s machines that can be used to save money and improve safety for its customers. Or Else In January, the company laid off researchers in areas deemed peripheral to GE’s “digital industrial” strategy. [Elizabeth Woyke, technologyreview.com, June 27, 2017]
Repare Therapeutics (Canada) announced a $68 M Series A funding after more than 18 months in stealth. ... aiming to fight cancer with synthetic lethality [Corie Lok, xconomy.com, Jun 22, 17]
Merck KGaA (Germany) pharmaceutical and life sciences company, launched a digital information center where it will experiment with virtual and augmentsed reality. [Will Anderson, Austin Business Journal , Jun 12, 17]
The Kauffman Foundation’s recently updated Index of Startup Activity finds that startup activity has increased for the third consecutive year and has now reached pre-recession levels. Nationally, the index, which measures business startup activity from 1997 to 2016, increased moderately after two years of sharp growth. [SSTI, May 31, 17]
A watchdog site calling out academic publishers for incorrectly charging readers for open access papers is gaining momentum. The site, Paywall Watch, tracks papers published in open access (OA) journals that are supposed to make content freely available online but instead appear behind a paywall for readers. [Dalmeet Singh Chawla, the Scientist, May 31, 2017]
a golden rule: When the product is free, that means you are the product. Your privacy is the cost of a free social network, free tax prep or free photo storage. [Geoffrey A. Fowler, Wall Street Journal, May 31, 17]
If a new version of an antibiotic of last resort lives up to its promise, that date with doom may be averted. A study on this bolstered form of vancomycin by scientists at The Scripps Research Institute in La Jolla was released Monday. ... three modifications to vancomycin, all lethal to bacteria and independent of each other. ... The study was published in the Proceedings of the National Academy of Sciences. .... Once made available online, the report can be found at j.mp/bogervanco. [Bradley Fikes, San Diego Union Tribune, May 29, 17]
China is investing billions of dollars into growing its own biotechnology industry. ... Li Yan, general manager of Qilu Pharmaceutical was here to preside over her company’s opening of the area’s first Chinese-owned biotech incubator: the Qilu (pronounced chee-lew) Boston Innovation Center. The new 25,000-square-foot center in Brighton eventually could house up to 10 early-stage drug discovery companies in its sparkling first-floor labs [below] home office and research center of QLB Biotherapeutics startup that is an arm of the big Chinese drug maker. [Robert Weisman, Boston Globe, May 26, 17]
Only the best for only the richest. The first gene therapy treatment approved outside China is being pulled from the market because of a lack of demand. In 2012, European regulators approved Glybera to treat an ultrarare genetic disorder in which patients lack an enzyme called lipoprotein lipase that breaks down fats in the blood. But Glybera, which consists of viruses that insert a gene coding for the enzyme into muscle cells, cost $1 million a year, making it the most expensive drug in the world, and only one patient has had the treatment. Glybera's manufacturer, Amsterdam-based uniQure, said on 20 April that it would not seek to renew the drug's marketing approval when it expires later this year, noting that use “has been extremely limited.” Gene therapy observers say that more clearly effective gene therapies for diseases such as inherited immune disorders and hemophilia are still on track—although they, too, may come with eye-popping price tags. [Science, Apr 18, 17]
Giving the youngsters a break. NIH will start rationing grants to experienced investigators. In a May 2 announcement it plans to cap the number of grants an investigator can hold in order to free up funding for early-career scientists and those struggling to keep their labs afloat. It noted that numerous studies have found that as biomedical labs get bigger, their rise in productivity tapers off. The announcement did not touch on SBIR/STTR awards which may require Congressional action for such a change.
Making blood. Scientists at Boston Children’s Hospital in Massachusetts successfully turned human stem cells into the cells that produce red and white blood cells and platelets. A team at Weill Cornell Medical College in New York City achieved a similar feat starting with mouse cells. Results decades in the making, they may one day help create blood transfusions in the lab. [MIT Technology Review, May 18, 17]
Kasparov now believes computers will take over menial mental tasks and thus allow humans to pursue ‘creativity, curiosity, beauty, and joy.’ [Robin Hanson reviews “Deep Thinking: Where Machine Intelligence Ends and Human Creativity Begins” by Garry Kasparov, Wall Street Journal, May 18, 17] Of course, the humans will still need a means of support to affiord their enriching pursuits.
Juicero made the perfect punchline: a celebrated startup that had received a fawning profile from the New York Times and $120m in funding from blue-chip VCs ... was selling an expensive [$400 a copy] way to automate something you could do faster for free. ... another example of how profoundly anti-innovation America has become .... That’s because real innovation is very expensive to produce: it involves pouring extravagant sums of money into research projects that may fail, or at the very least may never yield a commercially viable product. In other words, it requires a lot of risk – something that, myth-making aside, capitalist firms have little appetite for. ... The economy becomes a mechanism for making the rich richer, and the money that might be used to finance the next internet is allocated to sports cars and superyachts. [Ben Tarnoff, The Guardian (UK), May 11, 17]
there are already lots of proven use-cases where AI is being used to augment the medical profession. One proven area is in medical imaging where AI and computer vision is helping with medical scan and imaging analysis to help support radiologists and other clinicians. One startup operating in this space is AIdoc Medical (Israel). ... solution is an AI system that can look at an [medical scan] anatomical area and detect high-level visual abnormalities, based on what the radiologist would like to see. [Steve O'Hear, techcrunch.com, Apr 26, 17]
The American economy is poised to embark on an innovation boom of historic proportions that will undermine incumbent players, transform everyday life, and make some alert investors very rich. .... The combination of advances in platforms and intolerable pain is about to result in an explosion in entirely new applications that are inexpensive to operate, are far less likely to fail, are far more secure, and easily accommodate unimagined advances in ease of use and effective output. This scenario will be seen in sector after sector. [John Michaelson, CEO of Michaelson Capital Partners, Wall Street Journal, May 10, 17]
I believe the accelerations set loose by Silicon Valley in technology and digital globalization have created a world where every decent job demands more skill and, now, lifelong learning. More people can’t keep up, and clearly some have reached for leaders who promise to stop the wind. [Tom Friedman, New York Times, May 10, 17]
"We were young and ignorant then; Now we're old and ignorant." -- Charlie Munger, Warren Buffet's 93-year-old alter-ego. Charlie's other gems from the annual meeting attended by 40,000.
Engineers at the AMRC (University of Sheffield Advanced Manufacturing Research Centre, Sheffield (England)) have developed a hybrid 3D printing process that allows electrical, optical and structural elements to be introduced throughout an additively manufactured component during the build process ... With the project currently at patent-pending status, [inventor of the technique, Mark] Cocking was tight-lipped on specific technical details but he did confirm that the process – which is fully automated – is able to embed strands – and potentially even tubes – of different materials groups such as copper, fibre optic, steel, and nitinol during the 3D printing process. He added that the technique also allows unbroken connectivity through X, Y and Z axis directions and that single or multiple strands can be embedded at a rate that does not effect the original build time of the component. [The Engineer, May 4, 17]
As [Drezner] tells it, three large-scale forces have remade the marketplace of ideas. The erosion of trust in prestigious institutions, the polarization of American politics, and the dramatic growth in economic inequality has made wealthy individuals and corporations into the primary buyers, dominating the market. [Noah Millman reviewing Daniel Drezner's The Ideas Industry, New York Times, May 6, 17]
“The causes of the current slowdown can be summed up as the Three Ds: depopulation, deleveraging and deglobalization. Between the end of World War II and the financial crisis of 2008, the global economy was supercharged by explosive population growth, a debt boom that fueled investment and boosted productivity, and an astonishing increase in cross-border flows of goods, money and people. Today, all three trends have begun to sharply decelerate: families are having fewer children . . . , banks are not expanding their lending [as before] . . . , and countries are engaging in less cross-border trade.” [Robert Samuelson quoting Ruchir Sharma, a top investment strategist at Morgan Stanley, Washington Post, May 7, 17] Beware of politicians' promises of big growth from their pet-rock, applause-tested ideas.
Why do we do it? Einstein famously noted that the “ground aim of all science is to cover the greatest number of empirical facts by deductions from the smallest possible number of hypotheses.” A comparable ethos is on display in “Behave,” and yet Mr. Sapolsky gives respectful as well as highly sympathetic and well-informed attention to the various “higher” levels of explanation—sociological, anthropological, economic—that contribute to a fully articulated explanation of complex human phenomena. ... It’s no exaggeration to say that “Behave” is one of the best nonfiction books I’ve ever read. [ David P. Barash reviewing Robert Sapolsky's Behave, Wall Street Journal, May 1, 17]
Sounds good, does little. Between 2000 and 2016, most of the U.S.’ largest trading partners cut their corporate rates. But. There is little compelling evidence any enjoyed substantially faster growth as a result, and certainly not on the scale of Mr. Trump’s ambitions; he wants to push the U.S. long-term growth rate from its current 2% to 3%. [Greg Ip, Wall Street Journal, May 1, 17]
Chemical discovery. Federica Bertocchini, a biologist at Spain's Institute of Biomedicine and Biotechnology of Cantabria and a hobbyist beekeeper, used [a plastic] bag to collect pests called wax worms. The caterpillars, the larvae of the mothGalleria mellonella , had infested her hives, chowing down on honey and wax. .... only to find “the worms all around and the plastic bag full of holes,” as Bertocchini said in an email to The Washington Post. ... three scientists reported Monday in the journal Current Biology, the wax worms aren't simply chewing the plastic into tiny bits. Instead, it appears that the animals — or something inside them — can digest polyethylene, a common plastic, producing ethylene glycol. ... The new report did not prove that the caterpillars were the responsible organisms. “At this point in time, we do not know if the caterpillars themselves are producing a digestive enzyme or might it be bacteria in their gut,” Bombelli, a biochemist at Cambridge, wrote to The Post. “Or it might be a bit of both!” [Ben Guarino, Washington Post, Apr 24, 17]
Harry Huskey, one of the last surviving scientists in the vanguard of the computer revolution, who helped develop what was once billed as the first personal computer because it took only one person to operate, though it was the size of two refrigerators, died on April 9. He was 101. [Sam Roberts, New York Times, Apr 20, 17]
Waxing nostalgic about jobs lost to technology is little better than complaining that antibiotics put too many gravediggers out of work. [Gary Kasparov, WSJ, Apr 14, 17]
Jackpot. In 1992, Zachary Zimmerman loaded up his car and drove from Pennsylvania to San Diego. Armed only with a bachelor’s degree in cellular and molecular biology, he pulled into the parking lot at the famed Scripps Research Institute in La Jolla and began hunting for a gig on its job board. He toiled as a technician, washing Petri dishes and emptying the trash. On Thursday, he and the other five employees at the company Forge Therapeutics in San Diego won an $8.8 million research award to spur development of a potentially groundbreaking class of treatments against the world’s deadliest drug-resistant bacteria known as “superbugs.” [Carl Prine, San Diego Union Tribune, Mar 31, 17]
Need quality techies? Nearly 40 percent of tech workers in the Bay Area are looking to move elsewhere [Silicon Valley Business Journal, Apr 4, 17] They would no doubt prefer their present "worth" and weather in a lower cost place.
Affordable desalination might be on the way: a graphene oxide sieve with pores of less than 1 nanometer in diameter is able to filter salt out of water.[technologyreview, Apr 3, 17] Read the science.
Brave prediction. Artificial intelligence and robots will not only perform many unpleasant and super-human tasks but also will complement our most human capabilities and make workers more productive than ever. Humans equipped with boundless information, machine intelligence, and robot strength will create many new types of jobs. [Michael Mandel and Bret Swanson, The Coming Productivity Boom Technology CEO Council, March 2017] Authors' analysis not shown, just their opinions. Ok for politics, but not for science and economics.
Productivity a mixed benefit? More than a third of U.S. jobs could be at “high risk” of automation by the early 2030s, a percentage that’s greater than in Britain, Germany and Japan, according to a report ..by accounting and consulting firm PwC, [which] emphasized that its estimates are based on the anticipated capabilities of robotics and artificial intelligence, and that the pace and direction of technological progress are “uncertain.” [Samantha Masunaga, Los Angeles Times, Mar 26, 17] With infinite R&D funding, we could infinitely reduce job counts to near zero while everyone enjoys vacation.
IBM and Google both said they aim to commercialize quantum computers within the next few years (Google specified five), selling access to the exotic machines in a new kind of cloud service. .... the first quantum computer to start paying its way with useful work in the real world looks likely to do so by helping chemists trying to do things like improve batteries or electronics [by], simulating molecules and reactions. [Tom Simonite, technologyreview.com, March 17, 2017] Good luck with that incursion into the life of molecules; just don't be shocked to run into the same morass of uncertainty as plagues the climate modellers.
Beijing is pushing Chinese firms to invest in early-stage U.S. companies specializing in technology with potential military applications, a [DOD white paper]says. ... AI startup Neurala (Boston, MA; no SBIR) turned to China for minority share in a capital raise when US military showed little interest. [Paul Mozur and Jane Perlez, New York Times, Mar 23, 17]
[Warren] Buffett quipped in 1999 that a farsighted capitalist should have shot down Orville Wright at Kitty Hawk in 1903, so as to avoid the century of operating losses in the airline industry that followed. [Dan McSwain, San Diego Union Tribune, Mar 19, 17]
Illinois Science & Technology Coalition released its Winter 2017 Innovation Index, identifying 804 university startups since 2016, including 129 from tech transfer activities and 497 remaining in Illinois. [SSTI, Mar 16, 17]
The University of Texas MD Anderson Cancer Center launched an ambitious project with IBM Watson to transform cancer care with the help of artificial intelligence. Almost five years and more than $62 million later, the institution has little to show for it, according to an audit by the [UT] System Audit Office [that]doesn’t evaluate IBM Watson’s scientific capabilities or whether the technology works for this purpose. ... An IBM spokeswoman said the “pilot was a success, and likely could have been taken forward had MD Anderson chosen to do so.” ... [an IBM] senior vice president of cognitive solutions and IBM Research said the Watson system was “all set to go.” He added that it would only take “months to get it up and running” if MD Anderson gave IBM “the green light. [Daniela Hernandez, Wall Street Journal, Mar 8, 17]
Just three years after opening its doors, San Diego’s only proton therapy center is seeking Chapter 11 bankruptcy protection. .... The center opened in 2014 with five treatment bays and a 90-ton cyclotron that used magnets to accelerate protons to two thirds the speed of light. Hopes were high that patients would come flooding in to have tumors of all kinds treated. [Paul Sisson, San Diego Union Tribune, Mar 2, 17]
Incubator U. For tech hubs to thrive, a city or region needs a nearby university, with a strong research and engineering tradition, providing a constant supply of skilled graduates. However, that isn’t enough. “There must also be a culture of tech commercialization within any nearby university,” says Chuck Eesley, affiliated faculty member at the Stanford Technology Ventures Program. “There’s no place for the Ivory Tower academic mindset, or the idea that commercialization somehow gets your hands dirty.” University incubators are already responsible for the commercialization of academic research output. But, in most cases, their influence is minor and peripheral. “Perhaps the university of tomorrow should be more like one big incubator,” suggests McLoughlin. [John Holden, techcrunch.com, Feb 21, 17]
Employees switch jobs at half the rate they did 15 years ago. Entrepreneurship has also plunged: Only 7%-8% of U.S. companies are start-ups, down from 12%-13% in the 1980s. .... a useful corrective to the conventional wisdom that American ingenuity, sooner or later, will revive a low-growth economy. There’s much less progress under way than most people think, and a prolonged era of sluggishness seems ever more likely. [Matthew Rees reviewing Tyler Cowen's The Complacent Class, Wall Street Journal, Feb 27, 17]
Scrunch up in the tail. United and American airlines are starting their super-austere economy sub-class fares that barely allow you to board the plane and sit on your carry-on in a tight seat near the tail for about a 10% discount from today's regular steerage price. First experimental subjects from Minneapolis in April.
the city of Boston has opened a new facility just for robotics startups. The nonprofit hub, MassRobotics, at 12 Channel Street in Boston’s Seaport Innovation District. [TechCrunch, Feb 17, 17]
Tech and healthcare entrepreneurs are less optimistic this year amid growing uncertainty about funding, finding talent and how new government regulations will affect their startups, according to an annual report by Silicon Valley Bank. [Cromwell Schubarth, Silicon Valley Business Journal, Feb 14, 17]
the upswing is global: In Europe, Japan, China and elsewhere, business surveys and markets have turned markedly more optimistic. This is partly because investors hope that any fiscal stimulus Mr. Trump enacts will spill over to other countries. [Greg Ip, Wall Street Journal, Feb 15, 17] Love that government spending (with lowered tax revenue) on borrowed money. Borrow in haste, let the children repent at leisure.
The MacArthur Foundation, known for bestowing its annual “genius” grants on artists, actors and other creative people, announced the eight semifinalists in a new competition: come up with the best proposal to solve a global problem, with a reward of $100 million. Out of more than 1,900 proposals submitted, the foundation’s judges chose eight: Orphanage care, Malnutrition in developing countries, Needless blindness, Americans without health insurance, Lack of access to books online, Newborn deaths in Africa, Lack of education for displaced children, River blindness in Nigeria. .... the award will be given out every three years [Graham Bowley, New York Times, Feb 15, 17] Can private funding of private entities do a better job than government to government?
Today, nearly half of young people under age 18 are racial minorities and a quarter are first and second generation immigrants. And this fraction will grow as the white population continues to age. [William Frey, Brookings, Feb 10, 17]
Manufacturing Jobs Aren’t Coming Back A town that once relied on textile mills for its economic lifeblood, Greenville, South Carolina, should be dead. Instead, it’s booming, thanks to big investment from companies like BMW, Michelin, and General Electric. But there’s a catch: the new factories going in are increasingly automated and employ fewer workers. Getting a job in one of these plants isn’t easy. Can We Build Tomorrow’s Breakthroughs? American manufacturing is in trouble. If it can be saved—and that’s a big “if”—it’s going to require old-guard companies to reinvent themselves while small startups find a way to build disruptive products that can be produced at scale. Nowhere is this more evident than in Michigan, where new prospects are taking shape in the automotive industry. [technologyreview.com, Feb 9, 17]
The U.S. economy has become less innovative and entrepreneurial. From 1977 to 2014, the number of new firms per $1 billion in GDP fell from 95 to 25, and the number of patents outside of health and IT per $1 billion halved relative to the 1980s. [Dynamism in Retreat, Economic Innovation Group, Feb 2017] Read the Dynamism in Retreat report.
Shrinking dynamism. While economic dynamism has powered U.S. prosperity for generations, it is now declining in nearly every definition of the term, according to new research from the D.C.-based think-tank and advocacy organization Economic Innovation Group (EIG). In Dynamism in Collapse, an analysis of economic conditions from 1977 to 2014, EIG finds that dynamism has decreased substantially, as seen in diminishing rates of job turnover, the share of employment in new companies, and the percentage of the population moving across state lines. This eroding dynamism, the report finds, has led to considerable challenges for regions, markets, and workers. [SSTI, Feb 8, 17] Read Dynamism in Collapse report.
Immigrants needed. Minnesota’s future population and economic growth depends on increased immigrant and refugee admissions. That’s the conclusion of a recent University of Minnesota report underlining the state's shrinking workforce, its aging baby boomer generation and the need for foreign-born workers to help lead sustained economic growth. As detailed in the “Immigrants and Minnesota’s Workforce” report, ... Yet Minnesota isn’t really equipped to make up that loss with the growth of the native population, according to the study. [Ibrahim Hirsi, Twin Cities Business, Feb 9, 17] Read the report Immigrants and Minnesota’s Workforce.
The best research to date indicates that 47 percent of all U.S. jobs are likely to be replaced by technology over the next 10 to 15 years, more than 80 million in all, according to the Bank of England. [Ed Hess, Washington Post, Feb 8, 17]
while immigrants represent about 15 percent of the general U.S. workforce, they account for around a quarter of entrepreneurs and a quarter of inventors in the U.S. Moreover, over a third of new firms have at least one immigrant entrepreneur in its initial leadership team. [Dany Bahar, Brookings, Feb 7, 17]
Thanks to automation, we now make 85 percent more goods than we did in 1987, but with only two-thirds the number of workers. This suggests that while Mr. Trump can browbeat manufacturers into staying in America, he can’t force them to hire many people. Instead, companies will most likely invest in lots and lots of robots. AND The robots won’t be made in America. They might be made in China. [Farhad Manjoo, New York Times, Jan 25, 17]
Scientists at The Scripps Research Institute in La Jolla say they have engineered the first stable life form that incorporates artificial DNA The semi-synthetic organism is an improved version of one unveiled in 2014, said Floyd Romesberg, who led the team that created both versions. [Bradley Fikes, San Diego Union Tribune, Jan 23, 17]
manufacturing jobs, as contrasted with manufacturing activity, are not coming back to the United States, nor are they coming back most anywhere. New technologies have been rapidly eliminating manufacturing jobs everywhere — even in China. ... Mr. Trump will soon find out that to increase the total number of jobs at higher real wages, the United States will need more trade rather than less. Trade increases the extent of the market, thus reducing unit costs, and allows for comparative advantage, making better use of labor (resulting in higher real wages) and capital everywhere. [Richard Rahn, Washington Times, Jan 23, 17]
Economic reality. For decades, Americans believed that they were riding a magic carpet of economic growth, owing to advances in science and, later, to the rise of Silicon Valley. In fact, growth in total factor productivity has been slow since the early 1970s. The 1996-2004 Internet boom was only a fleeting departure from the trend. Over time, as businesses have cut back on investment in response to diminishing returns, growth in labor productivity and hourly wages has slowed, and workers in many households have dropped out of the workforce. .... as I show in my book Mass Flourishing: How Grassroots Innovation Created Jobs, Challenge, and Change, American innovation first began declining or narrowing as far back as the late 1960s. [Edmund Phelps, Project Syndicate, Jan 16, 17] Look askance at glowing growth projections from political maneuvers.
We don’t have a clear definition of “great,” or of the historical moment when, presumably, America was truly great. ... because the country is wealthier than it has ever been: Real per capita household net worth has reached a record high, as Federal Reserve Board data shows. But the distribution of wealth has certainly changed: Inequality has widened significantly. [Robert Shiller, NYTimes, Jan 12, 17] Nevertheless, "we" elected one of the greatly unequal to remedy the inequity of the uncompetitively educated who used to rely on labor unions for their mutual protection, before the greatly unequal destroyed the unions with automation and "right-to-work" laws.
Monopoly growth. According to research at the New America Foundation, the number of start-ups fell 53 percent in the years between 1977 and 2010 when the country stopped seriously enforcing antitrust laws. ... Three companies control 99 percent of the drug stores in the country. ... The bigger monopolists get, the more resources they can spend on lobbying government to change the rules or protect their advantages. [Justin Talbot-Zorn, thenation.com, Jan 16, 17] Capitalism left untended would concentrate business in ever larger monopolies. The 21st century is returning to the 19th century.
CIA-backed Arlington venture fund In-Q-Tel is boosting investment in security software platform Phantom, in the California company's new $13.5M seed round . The Kleiner Perkins-led round will add to the company's sales and engineering for its automated security software platform. In-Q-Tel was part of the company's first funding round in March. [DC InnoBeat, Jan 12, 17]
Celgene is paying Anokion (Swiss) $45 million up front. ... Anokion has laboratories in Cambridge, MA, stands to gain an additional $10 million if the company hits pre-clinical milestones. The deal also gives Celgene an equity stake in Anokion plus the exclusive right to buy the biotech at a pre-specified but undisclosed point. In the meantime, Anokion will keep control of its research and development programs. Anokion’s research focuses on immune tolerance, the process in which the immune system learns to recognize the proteins of invading agents, such as bacteria or viruses. [Frank Vinluan, xconomy.com, Jan 9, 17]
More than one-third of tech professionals are earning at least 10% less than they could command if they looked for a new job today, according to salary-data firm Paysa. [Lauren Weber, Wall Street Journal, Jan 10, 17]
For the 24th year in a row, IBM again took home the top spot in the annual race of new patents, racking up a record 8,088 patents in 2016, or roughly 22 patents per day. [Luke Stangel, Silicon Valley Business Journal, Jan 9, 16] How many lawyers do you think that takes?
George Scangos is back in the Bay Area, targeting HIV and other infectious diseases. The former Exelixis CEO — who spent the past six-plus years leading Boston-area biotech Biogen — is CEO of Vir Biotechnology ... backed by $150 million from Arch Venture Partners, an equity investment from the Bill & Melinda Gates Foundation and other unspecified investors. [Ron Leuty, San Francisco Business Times, Jan 5, 17]
A team at Hewlett Packard Labs has built what it claims to be the biggest and most complex light-based computer chip, which could solve traveling salesman problems faster than conventional hardware. Read IEEE paper By Rachel Courtland.
Establishing correlations, causality and logical interpretation for why innovation occurs has occupied much social science theory and research — to mixed results. Sometimes invention emerges from quirky, stubborn isolation and greed, and unfortunately sometimes from repressive, authoritarian and totalitarian regimes. If America has proved particularly fertile for ingenuity, though, the reasons won’t be found in this pleasant but superficial book. [Richard Kurin reviewing Baker's AMERICA THE INGENIOUS, NewYork Times, Jan 1, 17] For a variety of reasons, innovation (that horrid overused word) thrives in America. One certain helper is the wealth of capital seeking an outsize return. Which undercuts the pleadings for government programs like SBIR and results in government picking winners among the uncompetitive for private capital who cannot or will not swim in the capital ocean.
Let’s be honest: no one knows what is happening in the world economy today. Recovery from the collapse of 2008 has been unexpectedly slow. .... Policymakers don’t know what to do. They press the usual (and unusual) levers and nothing happens. Quantitative easing was supposed to bring inflation “back to target.” It didn’t. Fiscal contraction was supposed to restore confidence. It didn’t. ..... What unites the great economists, and many other good ones, is a broad education and outlook. This gives them access to many different ways of understanding the economy. The giants of earlier generations knew a lot of things besides economics. Keynes graduated in mathematics, but was steeped in the classics (and studied economics for less than a year before starting to teach it). Schumpeter got his PhD in law; Hayek’s were in law and political science, and he also studied philosophy, psychology, and brain anatomy. Today’s professional economists, by contrast, have studied almost nothing but economics. [Robert Skidelsky, project-syndicate.org, Dec 28, 16] But despair not, a national referendum has chosen an economic saviour - Trump - with promises unlimited.
a middle-school English teacher tried to get [author Michael Lewis] suspended. He had assigned the class to write a report on the historical novel “Johnny Tremain.” Michael turned in a piece that was so good, the teacher asked how he had done it. Michael merrily admitted that he had copied his report directly from the back cover of the book. When ordered to write 100 times “I will not plagiarize,” Michael shot back that the task seemed to him another form of plagiarism. It took the intervention of the headmaster to protect him from being suspended. [Walter Isaacson, Washington Post, Jan 1, 2017] Lewis has succeeded again with the praised The Undoing Project.