When Taleb explained to the World the concept of the Black Swan, the high impact of the event was the danger, but the low probability of such an event happening was even more dangerous, because you just couldn’t prepare for it. The problem is he never talked about what happens when two Black Swans happen back to back. He didn’t need to, because statistically it would be extremely close to zero. Which is why no one knows how to react to explosions in Lebanon or flight accidents in Kozhikode. What do you focus on?
The normal human approach with any large scale problem is that you ignore it till it becomes so big that it can’t be ignored (don’t fix it unless it’s broken). Coronavirus is the first problem that modern mankind has faced, that became so big that the only solution was to ignore it. Nothing can derail evolution, but events can accelerate it. Is this the first time mankind has chosen to collect an extra fruit even though there is a wild animal close-by? For the first time in history, we have been exposed to an issue which we medically understand but has been around for about 6-7 months. Did we learn something new about how we behave to extremely long periods of duress? Is our flight vs fight response being tested to something new for the first time. Just something to think about.
Don’t worry, this weeks’ edition is not about the philosophy of evolution. It’s been a couple of months since we did a piece around the world and this week seemed like an appropriate time to check in on what’s happening. We cover 4 continents today in 4 articles which should give us a fascinating perspective on what is happening in these 4 countries in these times. Embedded in them are fascinating theories about what works and what doesn’t and in the case of the United States, maybe doing nothing would work much better. In the last article of the week, we move away from the theme to a rather humorous article on Microsoft Excel vs Study of Genes. Something a little less heavy for a Sunday evening.
1. Credit card debt in the US has fallen since the Pandemic. Essentially in a huge leap it has been proven that handing money out is effective. Now what if you could build automated stabilizers. For example as soon as the signs of recessions come, and people start getting laid off, the data works for itself and starts a program of giving out unemployment benefits etc. Once you know the solution, you don’t need to pass a bill every time or debate for hours. It is a fascinating article on the future of world economies and how tech can come to play a part in it.
2. Beirut was called the Paris of the Middle East. If history can teach something to everyone, it is that mismanagement can in the long term be the biggest disaster. Even before the explosion and before COVID, Lebanon was in the middle of a revolution as people revolted against the elite. This article takes you through what happened to Lebanon and why it has reached the state it is in. To give you one instance, post the explosion, hardly any Lebanese leader could roam the streets but Emmanuelle Macron was warmly welcomed.
3. For Mr Fernandez, this is what his metrics sheet would have looked like in June. Unemployment at 40%, Inflation at 40%, Debt payments of almost $65 billion bonds due and a pandemic to fight. Argentina has been in a fix for quite some years now. But Mr Fernandez, the President can probably take a breather in August (just for a day or so). The debt payments have been pushed after negotiation. And because of early action Argentina has handled COVID much better than its neighbours. It’s the beginning, maybe of some better days. I add this article because we usually compare ourselves to European or Chinese economies. For anyone trying to get perspective on what India should do, there are some much better examples in the world and they all make for fascinating study.
4. For 29 years Australia did not go through a recession. It survived the 2008 Financial crisis and so much more that it is almost magical. Deconstructing it would lead to a couple of reasons. Firstly there has been a huge upturn in consumer spending and mining, keeping two variables well in the green. Secondly, Australia has seen a massive benefit from the rise of the Chinese economy. In the early 2000’s China was responsible for 7% of Australia’s exports. Today it would be accounting for almost 30-35%. But the age of no recession has finally ended. COVID doesn’t care much about records, but for the sake of the global economy we should hope that Australia jumps back stronger. A fascinating article.
5. In the last article we move away from the theme to something very odd. The study of genes is going to revolutionize the world. From fighting the most deadly diseases to understanding us better, it is a crucial field. In the most bizarre turn of events the biggest challenge in the field is Microsoft Excel. I found the article to be quite humorous. But apparently, even in some of the most advanced fields of study in the world, it’s still Excel sheets that call the shots.
Hope you had fun reading !