What caught my attention – week of 20 April 2020

The situation in Hong Kong seems to be improving, at least for now, and many are beginning to contemplate the best way of returning to some sort of sanity. Fortunately, things never got terribly out of control that would warrant a large scale lockdown but still the question remains of just how bad things can get after a gradual reopening. Over the past weeks the majority of the remaining cases have been from people returning from overseas while the domestic cases seemed to be under control.

So what’s next? That’s what on everyone’s mind. My best guess is that within the next few months regional travel will restart to some extent followed by international travel (I suppose there’ll be some sort of rules or establishment of “safe zones”). However, as HK is a major international travel hub additional waves of new cases are inevitable, especially later in the year as a generally colder season returns to major parts of the world. We’ll probably experience waves of opening and closing for the better part of the next 18-24 months with the economy sputtering along. For things to fully recover I think it’ll take more time (and effort) than most expect and some adjustments will have to be made to our livelihoods.

In any case, while the “outside” circumstances are not what we’d like it to be it is the perfect time and opportunity to make our “inside” pleasant. It is the perfect time to deepen the practices (the sadhana, if you will) and make sure we come out of this situation better human beings. I know, I’m working towards that.

Below are a selection of few articles from last week, ranging from agriculture, to the unique situation (to say the least) in the oil markets to men and divorces. Enjoy.

1. Agriculture

Title: Coronavirus: The American Food Security Guide
Link: Zeihan on geopolitics

The core of our dispute is information. The United States still hasn’t reached sustainable COVID testing capacity of 150,000 people a day. Until the country hits one million, complete economic lockdown is really the only mitigation method for any flareups. At the rate we are going we will not get there this year. That leaves all three of us guessing. Just how bad COVID-19 is going to be? Just how long will it last? Can we get reinfected? How soon until a reasonable treatment?

Which brings us to two conclusions.

First, it is time to start gaming out weaknesses in the system. Trucking, meat packing, food processing, migrant labor dependency, grocery store workers. All these and more are potential failure points. For them to impact—I mean really impact—food supplies at the local level they would need to fail badly. But low risk is not the same as no risk, and coronavirus continues to…surprise.

Second, we will have product mismatches. It is less an issue of raw demand or supply, and instead an issue of preparation and packaging.

2. Global oil

Title: Negative Oil Prices: How it Happened and Resulting Implications
Link: Goehring and Rozencwajg

The result was basically a short-squeeze in reverse: traders were forced to repeatedly reduce their offer price to try and find an able buyer. When no such buyer presented themselves, the price broke through zero with “trapped” longs offering to pay the “buyers” up to $45 per barrel to take the crude off their hands. While this all sounds incredibly bearish, we should point out that it is a result of how “financialized” the oil markets have become. For example, Brent crude (the other major oil future contract) is not physically settled and so not subject to the same issues. As a result, Brent finished the day at $25.57 per barrel. Similarly, the WTI June 2020 contract (not impacted by today’s “squeeze”) finished the day at $20.43.

3. Global oil (part 2)

Title: That Time I Tried to Buy an Actual Barrel of Crude Oil
Link: Bloomberg

A fortuitous meeting between a gas trader and his broker at a bar in downtown New York was not going the way I had hoped. After revealing a long-held plan to try to buy a barrel of crude, I was now receiving a disappointingly stern lecture on the dangers of hydrogen sulfides. The wine tasted vaguely sulfuric, too.

Oil may be king of the commodities, but its physical form is tough to come by for a retail investor. Mom and pop can buy gold and silver. They can gather aluminum cans, grow soybeans, and strip copper wiring, if they choose, but oil remains elusive—and for very good reason. Oil, as I would soon discover, is practically useless in its unrefined form. It is also highly toxic, very difficult to store, and it smells bad.

4. Books

Title: Thanks to Bookshop, There Is No Reason to Buy Books on Amazon Anymore
Link: Inside hook

Now, to stay alive, they’re [independents] hanging by the thread that is online sales, and that’s where Bookshop comes in. “The idea came to me a long time ago — five years ago. I was thinking about all the challenges that independent local bookstores were having competing with Amazon. It occurred to me that they should not actually be handling their online orders, that there should be a platform where their orders could be shipped directly to customers from a wholesaler,” says Hunter. “That way, all the competitive disadvantages that they have could be taken care of.”

5. Men, fathers and divorce

Title: What Representing Men in Divorce Taught Me About Fatherhood | Marilyn York
Link: TEDxUniversityofNevada

Attorney Marilyn York owns a Men’s Rights Family Law Firm in Reno Nevada, established in 2001. She and her ten female employees focus on representing men for two reasons:

1. As her talk explains, fathers are crucial in the upbringing and development of their children; and

2. Fathers are the disadvantaged parent in family court and society and while the laws are improving, the statistics are not. 

There are currently more than 17,000,000 children growing up in America without their fathers and every year this number is growing. According to the Center for Disease Control, children from fatherless homes account for 90% of homeless and runaway children; 71% of high school dropouts and 63% of youth suicides. Listen to this talk to find out how you can help America’s 17,000,000 fatherless children avoid these fates!

+1 Book of the week

Title and author: Brian Grazer – A curious mind

I first read about (legendary Hollywood producer) Brian Grazer in Michael Eisner’s Working Together book about partnerships. I was struck by his habit of, what he calls as, ‘curiosity conversations’. When he was starting out in his career he’d call people up he was interested in meeting and say: “Hi, my name is Brian Grazer. I work for Warner Bros. Business Affairs. This is not associated with studio business, and I do not want a job., but I would like to meet Mr. So-and-so for five minutes to talk to him…” And I always offered a specific reason I wanted to talk to everyone. My message was clear: I worked at a real place, I only wanted five minutes on the schedule, I did not want a job. And I was polite.” Through this simple change in habit he met thousands of people and received free education about many different aspects of life.

I thought that this sounded like a lot of fun, so why not try it. Over the years I have been very fortunate to meet successful entrepreneurs, doctors, spiritual teachers, real estate developers, investors, nutritionists, chefs, graphologists, authors, farmers, teachers, VCs, bankers, philanthropists, artists, fitness gurus, personal development nuts, photographers and on and on and on.

The first few approaches and conversations were weird (…I mean you talk to total strangers and tell them that you want to ask a bunch of questions and no, you are not a reporter). But I learnt that people are really interested in people who are really interested in them. With that the weirdness disappeared. I gained more friends and increased my knowledge in those areas.

More importantly, over time, I was also able to return the favour to these kind people who shared their time with me by making introductions, helping them with their problems or finding investors/employees/advisors etc. Through this small shift in habit I’ve become better at connecting the dots.