Thursday, January 5, 2017

Q&A - 5/1

News

Republicans in Congress want to repeal Obamacare.

Good..

.. if they replace it with something working, such as single-payer healthcare. If it works in Canada, Australia, it should be good enough for the United States of America. I have a feeling US did not go this route, because low-skilled immigration issue is entangled here somehow.. If that is the case, then the priority should be clear - given the choice between low-skilled immigration and healthcare (that is not an abomination) like Obamacare, then the choice should be for functioning health-care.

Comment

But Obamacare tried to work within the existing the system, balancing everyone's needs.

Hmmm...

Then why did Aetna pull out? Oh, and they announced this in 2016 smack in the middle of the presidential race, saying a big fffuuuuuuuuuuuccccccckkkk yoooouuuuuu to the administration. Imagine the conditions that caused them to do that. Companies do not prefer to get in public spats with the government. If they do, you can be sure they are hurting badly.

This is the final criticism on Obamacare - it became the Byzantian piece of work that it became because, reportedly, it tried to remain in the existing system.. but participants in the existing system are not happy. So mission not accomplished.

Comment

US owes nearly 20 trillion in debt.

What is the maturity?

Debt maturing (paid back) in 1 years is not the same as debt maturing in 10. Plus US debt is paid back in US dollars, US could simply inflate that away. Say with 7% inflation US would have to pay back only half the debt in 10 years. "The magic of compounding" works in the other direction too, you see, let's call it the black magic of reverse compounding (inflation).

Now, there is bunch of hoopla around Trump's plans for deficit spending which will surely cause inflation. If central bank wants to "tame" inflation and raises rates, then it will be back to 80s under Volcker, the king dollar. But if you wanted to generate inflation higher than usual, u'd need FED not be as gung-ho as Volcker. Then.. maybe Trump would want to appoint someone unlike Volcker after Yellen.. But is the debt issue that much of a big deal to start changing things around at this scale?

Let's try to think other reasons.. The new admin wants to f..k the Chinese who are holding 1 trillion US debt (not sure of the maturity). But with long maturity they would not be f..ked fast enough, it'd be a nice and slow grind, plus Japanese hold nearly as much debt as the Chinese - who are a solid US ally (I guess that is why the press does not make a big deal about them holding debt).

There was some talk around debt restructuring, etc.. But candidates say a lot of things on the campaign trail. Whatz brother T gonna do? Let's wait and see.

Question

But if someone is holding your debt, don't they have you over the barrel?

No

Debt issuers have many advantages, especially a country like US who can find buyers for its debt easily. See the article. If someone owns %5 of your debt, they don't own 5% of you.

Question

Trump wants to degrade Chinese power in exporting.

It can happen

It happened to the Japanese. IMO the rise of the Chinese was encouraged by US to counterbalance the Japanese. In fact one of the better explanations I heard about Japanese being in constant crisis of late is that they did not adapt to the world where China became the major exporter. Let's remember the 80s - they were the rising star, ppl were in a tizzy on Japanese buying up US assets, right? Remember the book / movie Rising Sun?

If the #1 economy in the world wants a country to become #2, that country will become #2.

Question

How did the US help China and Japan?

Know-how transfer, educating next generation of scientists

I heard a research scientist in US says once that "these Chinese are smart, they send PhD students targeted for specific areas, then they go back and invent stuff". But none of that can happen if US did not have an open-door policy for their scientists. Same was true for Japan previously. "But Japan made breakthrough advances in quality engineering, they followed Edwards Deming's teaching well". Right, but the US government sent him there. For that specific purpose.

Obviously both China and Japan made use of the opportunities, and became great economies, and China is on route to become a major innovator. All great stuff.

Question

What latest tech did you like recently?

A tea cup

I was sitting at a cafe and they brought tea in this cup


The cup has two layers with air in between, so tea is sort-of floating in air (looks great!), and the outside layer remains cold. No burnt fingers, no tiny holder on the side either so to I dont have to do frickin surgical strike just to hold the shit momentarily.  Awesome tech.