#global equities

[sizzlingsandwichperfection-blog]

We celebrate the purported geniuses who discovered the cure--but we don't acknowledge that discovering a cure means nothing unless and until we get the cure to the people who need it--an enterprise we've failed at to a remarkable degree over the last 70 years.

[mostlysignssomeportents]

Red Lobster was killed by private equity, not Endless Shrimp

For the rest of May, my bestselling solarpunk utopian novel THE LOST CAUSE (2023) is available as a $2.99, DRM-free ebook!

A decade ago, a hedge fund had an improbable viral comedy hit: a 294-page slide deck explaining why Olive Garden was going out of business, blaming the failure on too many breadsticks and insufficiently salted pasta-water:

https://www.sec.gov/Archives/edgar/data/940944/000092189514002031/ex991dfan14a06297125_091114.pdf

Everyone loved this story. As David Dayen wrote for Salon, it let readers "mock that silly chain restaurant they remember from their childhoods in the suburbs" and laugh at "the silly hedge fund that took the time to write the world’s worst review":

https://www.salon.com/2014/09/17/the_real_olive_garden_scandal_why_greedy_hedge_funders_suddenly_care_so_much_about_breadsticks/

But – as Dayen wrote at the time, the hedge fund that produced that slide deck, Starboard Value, was not motivated by dissatisfaction with bread-sticks. They were "activist investors" (finspeak for "rapacious assholes") with a giant stake in Darden Restaurants, Olive Garden's parent company. They wanted Darden to liquidate all of Olive Garden's real-estate holdings and declare a one-off dividend that would net investors a billion dollars, while literally yanking the floor out from beneath Olive Garden, converting it from owner to tenant, subject to rent-shocks and other nasty surprises.

They wanted to asset-strip the company, in other words ("asset strip" is what they call it in hedge-fund land; the mafia calls it a "bust-out," famous to anyone who watched the twenty-third episode of The Sopranos):

https://en.wikipedia.org/wiki/Bust_Out

Starboard didn't have enough money to force the sale, but they had recently engineered the CEO's ouster. The giant slide-deck making fun of Olive Garden's food was just a PR campaign to help it sell the bust-out by creating a narrative that they were being activists* to save this badly managed disaster of a restaurant chain.

*assholes

Starboard was bent on eviscerating Darden like a couple of entrail-maddened dogs in an elk carcass:

https://web.archive.org/web/20051220005944/http://alumni.media.mit.edu/~solan/dogsinelk/

They had forced Darden to sell off another of its holdings, Red Lobster, to a hedge-fund called Golden Gate Capital. Golden Gate flogged all of Red Lobster's real estate holdings for $2.1 billion the same day, then pissed it all away on dividends to its shareholders, including Starboard. The new landlords, a Real Estate Investment Trust, proceeded to charge so much for rent on those buildings Red Lobster just flogged that the company's net earnings immediately dropped by half.

Dayen ends his piece with these prophetic words:

Olive Garden and Red Lobster may not be destinations for hipster Internet journalists, and they have seen revenue declines amid stagnant middle-class wages and increased competition. But they are still profitable businesses. Thousands of Americans work there. Why should they be bled dry by predatory investors in the name of “shareholder value”? What of the value of worker productivity instead of the financial engineers?

Flash forward a decade. Today, Dayen is editor-in-chief of The American Prospect, one of the best sources of news about private equity looting in the world. Writing for the Prospect, Luke Goldstein picks up Dayen's story, ten years on:

https://prospect.org/economy/2024-05-22-raiding-red-lobster/

It's not pretty. Ten years of being bled out on rents and flipped from one hedge fund to another has killed Red Lobster. It just shuttered 50 restaurants and declared Chapter 11 bankruptcy. Ten years hasn't changed much; the same kind of snark that was deployed at the news of Olive Garden's imminent demise is now being hurled at Red Lobster.

Instead of dunking on free bread-sticks, Red Lobster's grave-dancers are jeering at "Endless Shrimp," a promotional deal that works exactly how it sounds like it would work. Endless Shrimp cost the chain $11m.

Which raises a question: why did Red Lobster make this money-losing offer? Are they just good-hearted slobs? Can't they do math?

Or, you know, was it another hedge-fund, bust-out scam?

Here's a hint. The supplier who provided Red Lobster with all that shrimp is Thai Union. Thai Union also owns Red Lobster. They bought the chain from Golden Gate Capital, last seen in 2014, holding a flash-sale on all of Red Lobster's buildings, pocketing billions, and cutting Red Lobster's earnings in half.

Red Lobster rose to success – 700 restaurants nationwide at its peak – by combining no-frills dining with powerful buying power, which it used to force discounts from seafood suppliers. In response, the seafood industry consolidated through a wave of mergers, turning into a cozy cartel that could resist the buyer power of Red Lobster and other major customers.

This was facilitated by conservation efforts that limited the total volume of biomass that fishers were allowed to extract, and allocated quotas to existing companies and individual fishermen. The costs of complying with this "catch management" system were high, punishingly so for small independents, bearably so for large conglomerates.

Competition from overseas fisheries drove consolidation further, as countries in the global south were blocked from implementing their own conservation efforts. US fisheries merged further, seeking economies of scale that would let them compete, largely by shafting fishermen and other suppliers. Today's Alaskan crab fishery is dominated by a four-company cartel; in the Pacific Northwest, most fish goes through a single intermediary, Pacific Seafood.

These dominant actors entered into illegal collusive arrangements with one another to rig their markets and further immiserate their suppliers, who filed antitrust suits accusing the companies of operating a monopsony (a market with a powerful buyer, akin to a monopoly, which is a market with a powerful seller):

https://www.classaction.org/news/pacific-seafood-under-fire-for-allegedly-fixing-prices-paid-to-dungeness-crabbers-in-pacific-northwest

Golden Gate bought Red Lobster in the midst of these fish wars, promising to right its ship. As Goldstein points out, that's the same promise they made when they bought Payless shoes, just before they destroyed the company and flogged it off to Alden Capital, the hedge fund that bought and destroyed dozens of America's most beloved newspapers:

https://pluralistic.net/2021/10/16/sociopathic-monsters/#all-the-news-thats-fit-to-print

Under Golden Gate's management, Red Lobster saw its staffing levels slashed, so diners endured longer wait times to be seated and served. Then, in 2020, they sold the company to Thai Union, the company's largest supplier (a transaction Goldstein likens to a Walmart buyout of Procter and Gamble).

Thai Union continued to bleed Red Lobster, imposing more cuts and loading it up with more debts financed by yet another private equity giant, Fortress Investment Group. That brings us to today, with Thai Union having moved a gigantic amount of its own product through a failing, debt-loaded subsidiary, even as it lobbies for deregulation of American fisheries, which would let it and its lobbying partners drain American waters of the last of its depleted fish stocks.

Dayen's 2020 must-read book Monopolized describes the way that monopolies proliferate, using the US health care industry as a case-study:

https://pluralistic.net/2021/01/29/fractal-bullshit/#dayenu

After deregulation allowed the pharma sector to consolidate, it acquired pricing power of hospitals, who found themselves gouged to the edge of bankruptcy on drug prices. Hospitals then merged into regional monopolies, which allowed them to resist pharma pricing power – and gouge health insurance companies, who saw the price of routine care explode. So the insurance companies gobbled each other up, too, leaving most of us with two or fewer choices for health insurance – even as insurance prices skyrocketed, and our benefits shrank.

Today, Americans pay more for worse healthcare, which is delivered by health workers who get paid less and work under worse conditions. That's because, lacking a regulator to consolidate patients' interests, and strong unions to consolidate workers' interests, patients and workers are easy pickings for those consolidated links in the health supply-chain.

That's a pretty good model for understanding what's happened to Red Lobster: monopoly power and monopsony power begat more monopolies and monoposonies in the supply chain. Everything that hasn't consolidated is defenseless: diners, restaurant workers, fishermen, and the environment. We're all fucked.

Decent, no-frills family restaurant are good. Great, even. I'm not the world's greatest fan of chain restaurants, but I'm also comfortably middle-class and not struggling to afford to give my family a nice night out at a place with good food, friendly staff and reasonable prices. These places are easy pickings for looters because the people who patronize them have little power in our society – and because those of us with more power are easily tricked into sneering at these places' failures as a kind of comeuppance that's all that's due to tacky joints that serve the working class.

If you'd like an essay-formatted version of this post to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:

https://pluralistic.net/2024/05/23/spineless/#invertebrates

[beingjellybeans]

Navigating Sun Life's Journey: Innovations and commitment to brighter financial futures

In a rapidly evolving landscape of financial services, Sun Life emerges as a beacon of innovation, illuminating the path to brighter futures for Filipinos. Recent developments spanning engaging roadshows, regional recognition, and pioneering investment strategies reflect not just a trail of achievements, but a dedication to empowering individuals and families. A Vibrant Blend of Inspiration and…

[leprivatebanker]

Volatility Perspective: Impact on Equities Sectors and the Potential for a Rotational Bullish Rally

The volatility outlook for equities sectors appears to be turning negative in the medium to long term, which could be seen as a bullish signal for the stock market to sustain its ongoing rally. However, the market is expected to exhibit more rotational behavior, contingent upon the influx of additional economic data.

[smitharaghu]

Investing in Global Equities: The Ultimate Guide to Maximizing Your Returns

Investing in global equities has become increasingly popular among investors as it provides the opportunity to diversify their portfolio and potentially maximize their returns. However, investing in global equities requires a certain level of knowledge and expertise. In this ultimate guide, we will explore the key considerations for investing in global equities and provide strategies for maximizing returns.

Why invest in global equities?

Investing in global equities provides several benefits, including:

Diversification: Investing in global equities allows investors to diversify their portfolio and reduce their exposure to country-specific risks. By investing in companies from different countries, investors can spread their risk and reduce the impact of a single company or market on their portfolio.

Access to growth opportunities: Global equities provide access to companies in different sectors and industries, allowing investors to capitalize on growth opportunities in different parts of the world.

Currency diversification: Investing in global equities can provide currency diversification benefits as well. Investing in companies denominated in different currencies can help investors protect against currency risks and benefit from currency movements.

Key considerations for investing in global equities

Investing in global equities requires careful consideration of several factors. Here are some key considerations to keep in mind:

Country-specific risks: Investing in global equities means investing in companies from different countries, each with its own economic, political, and regulatory environment. Investors must assess the risks associated with each country and factor them into their investment decisions.

Currency risks: Investing in global equities exposes investors to currency risks, which can impact returns. Investors must understand the currency risk associated with each investment and consider strategies to manage it.

Sector and industry risks: Investing in global equities means investing in companies from different sectors and industries, each with its own risk and return characteristics. Investors must diversify their investments across sectors and industries to reduce the impact of any one sector or industry on their portfolio.

Valuation: Investors must evaluate the valuation of each investment to determine whether it is overvalued or undervalued. An overvalued investment is likely to result in lower returns, while an undervalued investment presents an opportunity for higher returns.

Strategies for investing in global equities

There are several strategies that investors can use to maximize their returns when investing in global equities. Here are some of the most effective strategies:

Diversify across countries, sectors, and industries: Investors should diversify their investments across different countries, sectors, and industries to reduce risk and maximize returns. A diversified portfolio can help investors weather market volatility and capitalize on growth opportunities in different parts of the world.

Invest in companies with strong fundamentals: Investors should focus on companies with strong fundamentals, such as high earnings growth, low debt, and high return on equity. Companies with strong fundamentals are more likely to provide higher returns over the long term.

Use currency hedging strategies: Currency hedging strategies can help investors manage currency risks and protect against currency fluctuations. Investors can use instruments such as forward contracts and options to hedge against currency risks.

Invest in emerging markets: Emerging markets provide attractive growth opportunities, but they also come with higher risk. Investors should consider investing in emerging markets, but they should do so with caution and carefully assess the risks associated with each investment.

Use active management: Active management can help investors capitalize on market inefficiencies and generate higher returns. Active managers can use their expertise to identify undervalued investments and capitalize on growth opportunities in different parts of the world.

Conclusion

Investing in global equities can be a highly profitable and rewarding endeavor, but it requires a thorough understanding of the market and a well-planned investment strategy. By following the tips and advice outlined in this guide, you can maximize your returns and achieve your financial goals.

Remember to always do your due diligence, diversify your portfolio, and stay informed about market trends and developments. With dedication, patience, and a commitment to continuous learning, you can succeed in the world of global equity investing.

For more expert insights and analysis on the latest business news and trends, visit Biz Dispatch at https://bizdispatch.com/. Stay up-to-date with the latest developments in the world of business and finance and make informed investment decisions to achieve long-term financial success.

[intersectionalpraxis]

BNO News on Twitter: "South Korea's fertility rate, already the lowest in the world, dropped by another 8 percent in 2023.

New data shows the fertility rate dropped to 0.72, far below the 2.1 needed to maintain the population."

I made a post a while ago about the 4B movement in South Korea and how and why it pertains to the liberation and freedoms of Korean women. The tiktok video I shared a while ago gives background and context to Korean Feminism and current struggles that Korean women still face in their country. If you have the time to look at this as well, I highly recommend watching this video:

I am always in solidarity with Korean women, and I truly hope for real, systemic changes soon. Korean women deserve to always feel safe and protected -to always have the same access to opportunities and more.

[hussyknee]

Not entirely sure how I'm expected to respond when I point out something is white as fuck and the person I'm criticizing goes "I'm literally PoC!!" Okay? Good for you? Get well soon??

I literally live in South Asia, a place still nursing the world's worst colonial hangover. That's like one billion brown people desperately in need of joining Bootlickers Anonymous. If I had to respect the rancid takes of every yahoo that lives here I'd have to drown myself in the sea.

Living in white countries does something odd to diaspora brains. If you call yourself BIPOC in your own head long enough you end up forgetting you're just a garden variety idiot mainlining white supremacy like everyone else.

[solarpunkpresentspodcast]

In this episode, Christina talks with Star Ngei, a maker/hacker who helps raise awareness of Global South technology and innovation through the NGO Global Innovation Gathering (GIG), which hosts a network of makers and makerspaces throughout the Global South. Although it’s hard to generalize across a space as culturally, politically, economically, and geographically diverse as the Global South, Christina and Star discuss how the access of people in the Global South to tech is limited compared to that of people in the Global North and so they have a more creative, non-linear approach to technology. They’re far more open to modifying a piece (or pieces) of technology to fit their specific needs, rather than just using it as it comes out of the box and merely specifically for its intended use. Christina and Star also talk about climate change and what the Global North can learn from the Global South in terms of dealing with it. Lastly, they talk about building community and how, if you’re interested in working to decrease global inequality by helping people in the Global South, the best place to start is by striking up a relationship with a community there first. Unless you want your efforts to be a waste of your time, their time, and resources, don’t just give a group of people in the Global South what you think they need, find out what they think they would find useful.

[ausetkmt]

World Indigenous leaders meeting this week at an annual UN summit have warned that the west’s climate strategy risks the exploitation of Indigenous territories, resources and people.

New and emerging threats about the transition to a greener economy, including mineral mining, were at the forefront of debate as hundreds of Indigenous chiefs, presidents, chairmen and delegates gathered at the 22nd United Nations Permanent Forum on Indigenous Issues.

“It is common to hear the expression to ‘leave no one behind’. But perhaps those who are leading are not on the right path,” the forum’s chairman, Dario Mejía Montalvo, told delegates on Monday as the 12-day summit opened in New York in the first full convening since the pandemic outbreak.

The longtime advocacy group, Cultural Survival, in partnership with other organizations, highlighted how mining for minerals such as nickel, lithium, cobalt and copper – the resources needed to support products like electric car batteries – are presenting conflicts in tribal communities in the United States and around the world.

As countries scramble to uphold pledges to keep global warming to 1.5C (2.7F) above pre-industrial levels by 2030, big business and government are latching on to environmentally driven projects such as mineral needs or wind power that are usurping the rights of Indigenous peoples – from the American south-west to the Arctic and the Serengeti in Africa.

Brian Mason, chairman of the Shoshone-Paiute Tribes of the Duck Valley Indian reservation in Nevada said that the 70 or so lithium mining applications targeting Paiute lands have come without free, prior and informed consent – what is considered the cornerstone of the UN Declaration on the Rights of Indigenous Peoples. He described the lithium extraction efforts as being on a “fast track” to supply the Biden administration’s net-zero strategy to create a domestic supply of EVs . “It’s kinda just being rammed down our throats,” he said. “At the cost of Indigenous peoples once again.”

Gunn-Britt Retter of the Saami Council, an organization representing the Sami peoples of Finland, Russia, Norway and Sweden, said she had been raising awareness about what she calls the “green colonialism” driving harmful sustainability projects on Sami and Indigenous lands. The most recent example has been the Fosen onshore windfarm that was built despite a supreme court ruling in Norway in defense of Sami reindeer herding grounds.

“They look to us to carry the heaviest burden and it’s a disproportionate part of the burden,” she said of Indigenous peoples caught in the middle of a climate conundrum. “We need to reduce CO2 emissions globally, and we need to seek alternative energy sources, but we also need to protect the Indigenous cultures because we are the guardians of nature, which is part of the solution.”

Mejía Montalvo, who belongs to the Zenú peoples of San Andrés Sotavento in Colombia, said global climate talks have failed to properly include Indigenous peoples, yet at the same time, such dialogue has relied on a well of Indigenous knowledge systems to imagine future climate goals. “The issue of climate change and biodiversity cannot be resolved without the real and effective participation of Indigenous peoples.”

He urged the 193 member states affiliated with the UN, as well as its international governing bodies, to set a quota for actions that guarantee Indigenous peoples can take part in decisions affecting our planet, and in a way that puts them “on equal footing” with states – meaning, voting power, which Indigenous peoples lack.

The most recent example of the disparity came last fall in the historic “loss and damage” fund for vulnerable countries reached at Cop27 in Egypt. Indigenous peoples lacked explicit reference in the agreement, despite many world leaders, including the US president, Joe Biden, acknowledging the importance of Indigenous peoples in mitigating and adapting to climate change.

But there has been progress. The rights-based Paris agreement within the UN Framework Convention on Climate Change (UNFCCC) – the environmental treaty to combat the climate crisis – has provided a rare opportunity for formal Indigenous participation in the creation of the Local Communities and Indigenous Peoples’ Platform (LCIPP). The constituent body held its first meeting as a recognized working group in 2019, and engaged in dialogue with the Cop presidency last year in Sharm El-Sheikh.

Of the short cast of international leaders who spoke at the start of the global event on Monday was the first ever appearance by a UN secretary general, António Guterres, at a permanent forum opening ceremony. Also present was Deb Haaland, US interior secretary and tribal citizen of the Pueblo of Laguna, who received a standing ovation following her remarks where she acknowledged a litany of historic injustices against Indigenous peoples and a collective need to heal, saying Indigenous peoples must be brought into the fold in global human rights decision-making.

Lahela Mattos of Ka’Lāhui Hawai’i and a representative of the Global Indigenous Youth Caucus, urged the permanent forum chair to work with UN agencies like the World Health Organization to develop and implement comprehensive policies to better protect the safety of Indigenous women and girls as a way to protect the planet. “The destruction of and violence committed against our Earth Mother perpetuates, violence against Indigenous peoples, specifically Indigenous women who are protectors and bearers of life on this planet.”

The recommendation regarding “environmental violence” on Indigenous women and girls was first featured in a recent human rights treaty body outcome and represents one of the first fundamental links between human rights abuses and environmental catastrophe – a connection that most stakeholders grappling with the climate crisis have yet to make.

“Let us not forget that climate is the language of Mother Earth,” said Mejía Montalvo.

[mostlysignssomeportents]

The reason you can’t buy a car is the same reason that your health insurer let hackers dox you

On July 14, I'm giving the closing keynote for the fifteenth HACKERS ON PLANET EARTH, in QUEENS, NY. Happy Bastille Day! On July 20, I'm appearing in CHICAGO at Exile in Bookville.

In 2017, Equifax suffered the worst data-breach in world history, leaking the deep, nonconsensual dossiers it had compiled on 148m Americans and 15m Britons, (and 19k Canadians) into the world, to form an immortal, undeletable reservoir of kompromat and premade identity-theft kits:

https://en.wikipedia.org/wiki/2017_Equifax_data_breach

Equifax knew the breach was coming. It wasn't just that their top execs liquidated their stock in Equifax before the announcement of the breach – it was also that they ignored years of increasingly urgent warnings from IT staff about the problems with their server security.

Things didn't improve after the breach. Indeed, the 2017 Equifax breach was the starting gun for a string of more breaches, because Equifax's servers didn't just have one fubared system – it was composed of pure, refined fubar. After one group of hackers breached the main Equifax system, other groups breached other Equifax systems, over and over, and over:

https://finance.yahoo.com/news/equifax-password-username-admin-lawsuit-201118316.html

Doesn't this remind you of Boeing? It reminds me of Boeing. The spectacular 737 Max failures in 2018 weren't the end of the scandal. They weren't even the scandal's start – they were the tipping point, the moment in which a long history of lethally defective planes "breached" from the world of aviation wonks and into the wider public consciousness:

https://en.wikipedia.org/wiki/List_of_accidents_and_incidents_involving_the_Boeing_737

Just like with Equifax, the 737 Max disasters tipped Boeing into a string of increasingly grim catastrophes. Each fresh disaster landed with the grim inevitability of your general contractor texting you that he's just opened up your ceiling and discovered that all your joists had rotted out – and that he won't be able to deal with that until he deals with the termites he found last week, and that they'll have to wait until he gets to the cracks in the foundation slab from the week before, and that those will have to wait until he gets to the asbestos he just discovered in the walls.

Drip, drip, drip, as you realize that the most expensive thing you own – which is also the thing you had hoped to shelter for the rest of your life – isn't even a teardown, it's just a pure liability. Even if you razed the structure, you couldn't start over, because the soil is full of PCBs. It's not a toxic asset, because it's not an asset. It's just toxic.

Equifax isn't just a company: it's infrastructure. It started out as an engine for racial, political and sexual discrimination, paying snoops to collect gossip from nosy neighbors, which was assembled into vast warehouses full of binders that told bank officers which loan applicants should be denied for being queer, or leftists, or, you know, Black:

https://jacobin.com/2017/09/equifax-retail-credit-company-discrimination-loans

This witch-hunts-as-a-service morphed into an official part of the economy, the backbone of the credit industry, with a license to secretly destroy your life with haphazardly assembled "facts" about your life that you had the most minimal, grudging right to appeal (or even see). Turns out there are a lot of customers for this kind of service, and the capital markets showered Equifax with the cash needed to buy almost all of its rivals, in mergers that were waved through by a generation of Reaganomics-sedated antitrust regulators.

There's a direct line from that acquisition spree to the Equifax breach(es). First of all, companies like Equifax were early adopters of technology. They're a database company, so they were the crash-test dummies for ever generation of database. These bug-riddled, heavily patched systems were overlaid with subsequent layers of new tech, with new defects to be patched and then overlaid with the next generation.

These systems are intrinsically fragile, because things fall apart at the seams, and these systems are all seams. They are tech-debt personified. Now, every kind of enterprise will eventually reach this state if it keeps going long enough, but the early digitizers are the bow-wave of that coming infopocalypse, both because they got there first and because the bottom tiers of their systems are composed of layers of punchcards and COBOL, crumbling under the geological stresses of seventy years of subsequent technology.

The single best account of this phenomenon is the British Library's postmortem of their ransomware attack, which is also in the running for "best hard-eyed assessment of how fucked things are":

https://www.bl.uk/home/british-library-cyber-incident-review-8-march-2024.pdf

There's a reason libraries, cities, insurance companies, and other giant institutions keep getting breached: they started accumulating tech debt before anyone else, so they've got more asbestos in the walls, more sagging joists, more foundation cracks and more termites.

That was the starting point for Equifax – a company with a massive tech debt that it would struggle to pay down under the most ideal circumstances.

Then, Equifax deliberately made this situation infinitely worse through a series of mergers in which it bought dozens of other companies that all had their own version of this problem, and duct-taped their failing, fucked up IT systems to its own. The more seams an IT system has, the more brittle and insecure it is. Equifax deliberately added so many seams that you need to be able to visualized additional spatial dimensions to grasp them – they had fractal seams.

But wait, there's more! The reason to merge with your competitors is to create a monopoly position, and the value of a monopoly position is that it makes a company too big to fail, which makes it too big to jail, which makes it too big to care. Each Equifax acquisition took a piece off the game board, making it that much harder to replace Equifax if it fucked up. That, in turn, made it harder to punish Equifax if it fucked up. And that meant that Equifax didn't have to care if it fucked up.

Which is why the increasingly desperate pleas for more resources to shore up Equifax's crumbling IT and security infrastructure went unheeded. Top management could see that they were steaming directly into an iceberg, but they also knew that they had a guaranteed spot on the lifeboats, and that someone else would be responsible for fishing the dead passengers out of the sea. Why turn the wheel?

That's what happened to Boeing, too: the company acquired new layers of technical complexity by merging with rivals (principally McDonnell-Douglas), and then starved the departments that would have to deal with that complexity because it was being managed by execs whose driving passion was to run a company that was too big to care. Those execs then added more complexity by chasing lower costs by firing unionized, competent, senior staff and replacing them with untrained scabs in jurisdictions chosen for their lax labor and environmental enforcement regimes.

(The biggest difference was that Boeing once had a useful, high-quality product, whereas Equifax started off as an irredeemably terrible, if efficient, discrimination machine, and grew to become an equally terrible, but also ferociously incompetent, enterprise.)

This is the American story of the past four decades: accumulate tech debt, merge to monopoly, exponentially compound your tech debt by combining barely functional IT systems. Every corporate behemoth is locked in a race between the eventual discovery of its irreparable structural defects and its ability to become so enmeshed in our lives that we have to assume the costs of fixing those defects. It's a contest between "too rotten to stand" and "too big to care."

Remember last February, when we all discovered that there was a company called Change Healthcare, and that they were key to processing virtually every prescription filled in America? Remember how we discovered this? Change was hacked, went down, ransomed, and no one could fill a scrip in America for more than a week, until they paid the hackers $22m in Bitcoin?

https://en.wikipedia.org/wiki/2024_Change_Healthcare_ransomware_attack

How did we end up with Change Healthcare as the linchpin of the entire American prescription system? Well, first Unitedhealthcare became the largest health insurer in America by buying all its competitors in a series of mergers that comatose antitrust regulators failed to block. Then it combined all those other companies' IT systems into a cosmic-scale dog's breakfast that barely ran. Then it bought Change and used its monopoly power to ensure that every Rx ran through Change's servers, which were part of that asbestos-filled, termite-infested, crack-foundationed, sag-joisted teardown. Then, it got hacked.

United's execs are the kind of execs on a relentless quest to be too big to care, and so they don't care. Which is why their they had to subsequently announce that they had suffered a breach that turned the complete medical histories of one third of Americans into immortal Darknet kompromat that is – even now – being combined with breach data from Equifax and force-fed to the slaves in Cambodia and Laos's pig-butchering factories:

https://www.cnn.com/2024/05/01/politics/data-stolen-healthcare-hack/index.html

Those slaves are beaten, tortured, and punitively raped in compounds to force them to drain the life's savings of everyone in Canada, Australia, Singapore, the UK and Europe. Remember that they are downstream of the forseeable, inevitable IT failures of companies that set out to be too big to care that this was going to happen.

Failures like Ticketmaster's, which flushed 500 million users' personal information into the identity-theft mills just last month. Ticketmaster, you'll recall, grew to its current scale through (you guessed it), a series of mergers en route to "too big to care" status, that resulted in its IT systems being combined with those of Ticketron, Live Nation, and dozens of others:

https://www.nytimes.com/2024/05/31/business/ticketmaster-hack-data-breach.html

But enough about that. Let's go car-shopping!

Good luck with that. There's a company you've never heard. It's called CDK Global. They provide "dealer management software." They are a monopolist. They got that way after being bought by a private equity fund called Brookfield. You can't complete a car purchase without their systems, and their systems have been hacked. No one can buy a car:

https://www.cnn.com/2024/06/27/business/cdk-global-cyber-attack-update/index.html

Writing for his BIG newsletter, Matt Stoller tells the all-too-familiar story of how CDK Global filled the walls of the nation's auto-dealers with the IT equivalent of termites and asbestos, and lays the blame where it belongs: with a legal and economics establishment that wanted it this way:

https://www.thebignewsletter.com/p/a-supreme-court-justice-is-why-you

The CDK story follows the Equifax/Boeing/Change Healthcare/Ticketmaster pattern, but with an important difference. As CDK was amassing its monopoly power, one of its execs, Dan McCray, told a competitor, Authenticom founder Steve Cottrell that if he didn't sell to CDK that he would "fucking destroy" Authenticom by illegally colluding with the number two dealer management company Reynolds.

Rather than selling out, Cottrell blew the whistle, using Cottrell's own words to convince a district court that CDK had violated antitrust law. The court agreed, and ordered CDK and Reynolds – who controlled 90% of the market – to continue to allow Authenticom to participate in the DMS market.

Dealers cheered this on: CDK/Reynolds had been steadily hiking prices, while ingesting dealer data and using it to gouge the dealers on additional services, while denying dealers access to their own data. The services that Authenticom provided for $35/month cost $735/month from CDK/Reynolds (they justified this price hike by saying they needed the additional funds to cover the costs of increased information security!).

CDK/Reynolds appealed the judgment to the 7th Circuit, where a panel of economists weighed in. As Stoller writes, this panel included monopoly's most notorious (and well-compensated) cheerleader, Frank Easterbrook, and the "legendary" Democrat Diane Wood. They argued for CDK/Reynolds, demanding that the court release them from their obligations to share the market with Authenticom:

https://caselaw.findlaw.com/court/us-7th-circuit/1879150.html

The 7th Circuit bought the argument, overturning the lower court and paving the way for the CDK/Reynolds monopoly, which is how we ended up with one company's objectively shitty IT systems interwoven into the sale of every car, which meant that when Russian hackers looked at that crosseyed, it split wide open, allowing them to halt auto sales nationwide. What happens next is a near-certainty: CDK will pay a multimillion dollar ransom, and the hackers will reward them by breaching the personal details of everyone who's ever bought a car, and the slaves in Cambodian pig-butchering compounds will get a fresh supply of kompromat.

But on the plus side, the need to pay these huge ransoms is key to ensuring liquidity in the cryptocurrency markets, because ransoms are now the only nondiscretionary liability that can only be settled in crypto:

https://locusmag.com/2022/09/cory-doctorow-moneylike/

When the 7th Circuit set up every American car owner to be pig-butchered, they cited one of the most important cases in antitrust history: the 2004 unanimous Supreme Court decision in Verizon v Trinko:

https://www.oyez.org/cases/2003/02-682

Trinko was a case about whether antitrust law could force Verizon, a telcoms monopolist, to share its lines with competitors, something it had been ordered to do and then cheated on. The decision was written by Antonin Scalia, and without it, Big Tech would never have been able to form. Scalia and Trinko gave us the modern, too-big-to-care versions of Google, Meta, Apple, Microsoft and the other tech baronies.

In his Trinko opinion, Scalia said that "possessing monopoly power" and "charging monopoly prices" was "not unlawful" – rather, it was "an important element of the free-market system." Scalia – writing on behalf of a unanimous court! – said that fighting monopolists "may lessen the incentive for the monopolist…to invest in those economically beneficial facilities."

In other words, in order to prevent monopolists from being too big to care, we have to let them have monopolies. No wonder Trinko is the Zelig of shitty antitrust rulings, from the decision to dismiss the antitrust case against Facebook and Apple's defense in its own ongoing case:

https://www.ftc.gov/system/files/documents/cases/073_2021.06.28_mtd_order_memo.pdf

Trinko is the origin node of too big to care. It's the reason that our whole economy is now composed of "infrastructure" that is made of splitting seams, asbestos, termites and dry rot. It's the reason that the entire automotive sector became dependent on companies like Reynolds, whose billionaire owner intentionally and illegally destroyed evidence of his company's crimes, before going on to commit the largest tax fraud in American history:

https://www.wsj.com/articles/billionaire-robert-brockman-accused-of-biggest-tax-fraud-in-u-s-history-dies-at-81-11660226505

Trinko begs companies to become too big to care. It ensures that they will exponentially increase their IT debt while becoming structurally important to whole swathes of the US economy. It guarantees that they will underinvest in IT security. It is the soil in which pig butchering grew.

It's why you can't buy a car.

Now, I am fond of quoting Stein's Law at moments like this: "anything that can't go on forever will eventually stop." As Stoller writes, after two decades of unchallenged rule, Trinko is looking awfully shaky. It was substantially narrowed in 2023 by the 10th Circuit, which had been briefed by Biden's antitrust division:

https://law.justia.com/cases/federal/appellate-courts/ca10/22-1164/22-1164-2023-08-21.html

And the cases of 2024 have something going for them that Trinko lacked in 2004: evidence of what a fucking disaster Trinko is. The wrongness of Trinko is so increasingly undeniable that there's a chance it will be overturned.

But it won't go down easy. As Stoller writes, Trinko didn't emerge from a vacuum: the economic theories that underpinned it come from some of the heroes of orthodox economics, like Joseph Schumpeter, who is positively worshipped. Schumpeter was antitrust's OG hater, who wrote extensively that antitrust law didn't need to exist because any harmful monopoly would be overturned by an inevitable market process dictated by iron laws of economics.

Schumpeter wrote that monopolies could only be sustained by "alertness and energy" – that there would never be a monopoly so secure that its owner became too big to care. But he went further, insisting that the promise of attaining a monopoly was key to investment in great new things, because monopolists had the economic power that let them plan and execute great feats of innovation.

The idea that monopolies are benevolent dictators has pervaded our economic tale for decades. Even today, critics who deplore Facebook and Google do so on the basis that they do not wield their power wisely (say, to stamp out harassment or disinformation). When confronted with the possibility of breaking up these companies or replacing them with smaller platforms, those critics recoil, insisting that without Big Tech's scale, no one will ever have the power to accomplish their goals:

https://pluralistic.net/2023/07/18/urban-wildlife-interface/#combustible-walled-gardens

But they misunderstand the relationship between corporate power and corporate conduct. The reason corporations accumulate power is so that they can be insulated from the consequences of the harms they wreak upon the rest of us. They don't inflict those harms out of sadism: rather, they do so in order to externalize the costs of running a good system, reaping the profits of scale while we pay its costs.

The only reason to accumulate corporate power is to grow too big to care. Any corporation that amasses enough power that it need not care about us will not care about it. You can't fix Facebook by replacing Zuck with a good unelected social media czar with total power over billions of peoples' lives. We need to abolish Zuck, not fix Zuck.

Zuck is not exceptional: there were a million sociopaths whom investors would have funded to monopolistic dominance if he had balked. A monopoly like Facebook has a Zuck-shaped hole at the top of its org chart, and only someone Zuck-shaped will ever fit through that hole.

Our whole economy is now composed of companies with sociopath-shaped holes at the tops of their org chart. The reason these companies can only be run by sociopaths is the same reason that they have become infrastructure that is crumbling due to sociopathic neglect. The reckless disregard for the risk of combining companies is the source of the market power these companies accumulated, and the market power let them neglect their systems to the point of collapse.

This is the system that Schumpeter, and Easterbrook, and Wood, and Scalia – and the entire Supreme Court of 2004 – set out to make. The fact that you can't buy a car is a feature, not a bug. The pig-butcherers, wallowing in an ocean of breach data, are a feature, not a bug. The point of the system was what it did: create unimaginable wealth for a tiny cohort of the worst people on Earth without regard to the collapse this would provoke, or the plight of those of us trapped and suffocating in the rubble.

Support me this summer on the Clarion Write-A-Thon and help raise money for the Clarion Science Fiction and Fantasy Writers' Workshop!

If you'd like an essay-formatted version of this post to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:

https://pluralistic.net/2024/06/28/dealer-management-software/#antonin-scalia-stole-your-car

Image: Cryteria (modified) https://commons.wikimedia.org/wiki/File:HAL9000.svg

CC BY 3.0 https://creativecommons.org/licenses/by/3.0/deed.en

[leprivatebanker]

Rising Production Costs and Labor Market Strength Impact US Stocks amid Mixed Data Landscape

Rising production prices and a solid labor market, coupled with slightly lower jobless claims, have the potential to exert pressure on US stock markets. However, the market experienced an influx of buyers following yesterday’s lower-than-expected inflation reading, which may contribute to a more balanced market behavior as the Fed might to be conlcuded potentially more dovish. The mixed data…

[jcmarchi]

Faces of MIT: Jessica Tam

New Post has been published on https://thedigitalinsider.com/faces-of-mit-jessica-tam/

Faces of MIT: Jessica Tam

The MIT Office of the Vice President for Finance (VPF) determines the best ways to allocate funds for the goods, resources, and services that support the research, education, and important work performed by students, staff, and faculty at MIT. The attention to detail and organization of VPF’s staff members help community members understand and use Institute financial resources. One of the 170 staff members in VPF who works hard behind the scenes to make life at MIT more effective is Jessica Tam, senior strategic sourcing analyst, travel and hospitality.

Tam has been in the travel and hospitality industry for over 20 years. She worked for hotels for 15 years before arriving at MIT, leaving one side of hospitality for the other. Tam is well-versed in forming and maintaining relationships with vendors, including travel companies and caterers. Those invaluable skills allowed her to comfortably pivot from what she refers to as “being a supplier” to “being a buyer.”

A member of the strategic sourcing and contracts team, Tam is responsible for everything related to travel and hospitality (catering, dining, tents, and events) that involves purchasing. Knowing how to connect with people is a significant part of her job, as she oversees reaching out to suppliers, both potential and preferred, managing requests for proposals (RPFs), negotiating contracts, securing concessions, and ensuring the best value for MIT travelers and event planners. When assisting with travel accommodations, she troubleshoots issues that a traveler may run into. Tam also answers vendor questions and works very closely with Institute Events.

Even though she is constantly meeting and speaking with new people, Tam notes that the hospitality industry is small. When she came to MIT there was a lot to learn, but knowing the major players in the industry helped her to acclimate quickly into the role. With her expertise, Tam was immediately able to help streamline the hotel side of travel. With her knowledge of the industry, she was able to rebalance MIT’s negotiated rates so that they were competitive and in line with what she believed MIT should be paying.

A significant part of Tam’s job is vetting vendors to be included on the list of MIT preferred businesses. For example, when a staff member asks for VPF’s list of preferred hotels, it comes with expected price points for each that have already been negotiated by Tam, eliminating the need for that staff member to carry out a selection of source — finding two or three other competitive quotes. Terms and conditions have also already been put in place so that after selecting one of the preferred hotels, it is simple to gain approval in the buy-to-pay process. 

In May 2024, Tam received an Excellence Award for Embracing Diversity, Equity, and Inclusion for a project she began in March 2020 that was put on hold due to the pandemic. The initiative’s purpose was to bring diverse catering options for events taking place at MIT. The preferred catering services list in place when Tam started her job was mostly known, big-box caterers. When she resumed work on the project, Tam issued RPFs to small, local, Black- and minority-owned catering businesses. At the project’s conclusion, Tam had almost doubled the number of preferred caterers available to the community. In her award nomination, colleagues noted that Tam’s work “fosters inclusivity, contributes to the growth and success of our local economy, and brings new, diverse culinary options to our very global community.” 

Soundbytes

Q: What do you like the most about your job?

Tam: I enjoy introducing people to resources at MIT that they did not know existed. Sometimes there is a travel hiccup for a faculty member, and I get them on the next flight. If a catering order does not show up for an event, I check which preferred vendor has availability to come up with bagged lunches on a tight deadline. I’m here to answer questions that make my colleagues’ travel and events as seamless as possible. I want the community to know that I am here to be a resource. It’s a little-known fact that the VPF website is a great tool available to the community that has every possible piece of information not just for travel planning and hospitality, but for expense reports, budget planning, and more. 

Q: What do you like the most about the people at MIT?

Tam: I am a member of the strategic sourcing and contracts team, and everyone is so friendly. When we come together on in-office days it feels like a family. Our Vice President of Finance Katie Hammer is approachable and will ask, “How was your weekend? How are your kids?” I can walk to her office and ask a question, which is nice and probably different from other universities where you might hear about your VP but you could never ask them a question directly or say hello.

I also love that at MIT you might not initially know the accomplishments of the person you are working with. I have been talking to Professor Tod Machover, who is a composer, and it turns out that the popular video games “Guitar Hero” and “Rock Band” grew out of Machover’s group at the Media Lab — something that never came up in our work conversations. My first year at MIT I had to reach out to Sir Tim Berners-Lee, who is the inventor of the World Wide Web. You never know who you’re going to meet or talk to.

Q: What advice would you give to a new staff member at MIT?

Tam: Try and meet the people you will work with in person, even if your job is hybrid. This is my first job in higher education, and I had heard that working at a university can feel like you work in a silo. In hospitality I learned that a five- or 10-minute conversation goes a long way, even if it is just to say, “I’m Jessica, I’m in this role, and I look forward to working with you.” When I first started, I found a list of departments and people that I knew I would be working with and visited their offices to introduce myself and have a brief conversation. Meeting in person gives you a good understanding of how people communicate.

[projectfundingservices]

Global Star Capital founder Rich Cocovich recently met with principals in both New York City and Los Angeles California on a $5 Million USD entertainment sector project and bridged the gap of funding with a private California based investor. Since 1991, Cocovich has serviced clients in 126 countries and all 50 states in America as the top expert and private funding. Over 30 billion USD from private investors awaits the projects Global Star Capital and Rich Cocovich represent. If you are a solvent and prepared project principal who understands that high end, professional expertise is not free, not contingent, not pro bono, and not wrapped into a closing, then you are welcome to visit one of our two main websites www.globalstarcapital.com or https://lnkd.in/eFeNm-pb and begin in the Our Process Section. Our engagement process and fee structure is etched in stone and non-negotiable. Project principals who follow our protocol, including the mandatory face-to-face meeting steps, succeed in gaining the attention their project deserves. Within seven days of meeting Rich Cocovich in person, a greenlight from a private funding facilitator/investor will be established.

#richcocovich #globalstarcapital #privefunding #projectfunding #richcocovichreviews #globalstarcapitalreviews #cocovich #capitalraising #topconsultant #familyoffice #equity #equityfunding #projectequity #equityinvesting

[globalstarcapital]

Global Star Capital founder Rich Cocovich recently met with principals in both New York City and Los Angeles California on a $5 Million USD entertainment sector project and bridged the gap of funding with a private California based investor. Since 1991, Cocovich has serviced clients in 126 countries and all 50 states in America as the top expert and private funding. Over 30 billion USD from private investors awaits the projects Global Star Capital and Rich Cocovich represent. If you are a solvent and prepared project principal who understands that high end, professional expertise is not free, not contingent, not pro bono, and not wrapped into a closing, then you are welcome to visit one of our two main websites www.globalstarcapital.com or www.globalstarcapital.international and begin in the Our Process Section. Our engagement process and fee structure is etched in stone and non-negotiable. Project principals who follow our protocol, including the mandatory face-to-face meeting steps, succeed in gaining the attention their project deserves. Within seven days of meeting Rich Cocovich in person, a greenlight from a private funding facilitator/investor will be established.

#richcocovich #globalstarcapital #privefunding #projectfunding #richcocovichreviews #globalstarcapitalreviews #cocovich #capitalraising #topconsultant #familyoffice #equity #equityfunding #projectequity #equityinvesting

[privatefunding]

Global Star Capital founder Rich Cocovich recently met with principals in both New York City and Los Angeles California on a $5 Million USD entertainment sector project and bridged the gap of funding with a private California based investor. Since 1991, Cocovich has serviced clients in 126 countries and all 50 states in America as the top expert and private funding. Over 30 billion USD from private investors awaits the projects Global Star Capital and Rich Cocovich represent. If you are a solvent and prepared project principal who understands that high end, professional expertise is not free, not contingent, not pro bono, and not wrapped into a closing, then you are welcome to visit one of our two main websites www.globalstarcapital.com or www.globalstarcapital.international and begin in the Our Process Section. Our engagement process and fee structure is etched in stone and non-negotiable. Project principals who follow our protocol, including the mandatory face-to-face meeting steps, succeed in gaining the attention their project deserves. Within seven days of meeting Rich Cocovich in person, a greenlight from a private funding facilitator/investor will be established.

#richcocovich #globalstarcapital #privefunding #projectfunding #richcocovichreviews #globalstarcapitalreviews #cocovich #capitalraising #topconsultant #familyoffice #equity #equityfunding #projectequity #equityinvesting