…there’s six weeks of this…there hasn’t been six days…& I don’t know if my supply of replacement fuses is going to hold out for the long haul?

Sunak found himself under fire early on Monday, as Steve Baker, a Northern Ireland minister, said introducing mandatory national service was a policy dreamed up by advisers and sprung on candidates.

It later emerged that Baker, who is defending the Labour target of Wycombe, had chosen to go on holiday to Greece rather than stay on the campaign trail – after Sunak previously told MPs they should go ahead and book time off.

The prime minister was then hit with the defection of Lucy Allan, the Conservative MP for Telford, who said she would support the local candidate for Reform. The party suspended the whip, but she hit back saying she had quit first and that the Conservatives had no chance in her seat, according to the Shropshire Star.

…pass the buck to “advisers” if you want…but lucy there would be one of around four-score of rishi’s lot that quit rather than risk losing…not a few of which are running scared of reform making them look not-nuts-enough for the right…though…tellingly if you ask me…nige won’t be standing, either…oh, he’ll campaign…but he don’t want a grade on the final…because a man often referred to as one of the most influential politicians of a generation never could get elected to the commons…the EU he devoted his life to undermining pays him a pension…which he supplements from gigs fomenting pseudo-political rabble for the likes of dotardus maximus or wing-nuts in europe

[…& that shit is a serious concern…what with things talking about “Le Pen invites Meloni to form nationalist ‘super-group’ in European parliament” in the pages of the guardian…for starters…the ladies being a more “acceptable face” than nige…or orban…or whatever]

…but…”dems in disarray” eat your damn heart out

Sunak’s woes increased further when Zac Goldsmith, the Conservative peer and former minister who resigned over his unhappiness with Sunak’s lack of commitment to the environment, accused him of having “damaged the party almost beyond repair”.

“The hope is that when Sunak disappears off to California in a few weeks there are at least some decent MPs left around [with] which to rebuild,” Goldsmith said.

Appearing in Amersham, where the Tories lost a byelection to the Lib Dems last year, Sunak ignored questions about the defection and criticism from Baker. He did, however, angrily respond to Goldsmith for predicting he would move to the US if the Conservatives lost the election, pledging to stay on and serve a full term as an MP.

…uh huh

Rishi Sunak’s national service pledge is ‘bonkers’, says ex-military chief [Guardian]

…& he’s in touch with working people too, I’ll bet

…”his team” just got promoted to the premier league (that’s a soccer thing in case the sprots reference coming from me was close enough to left-field to throw you)…so of course he won’t pull his kids out of school over the summer & take off with his tail between his legs

“I’m surprised at Lord Goldsmith, who I don’t think I’ve spoken to in a very long time, has some intimate knowledge of my family’s arrangements,” Sunak said. “Of course not. My kids are at school, this is my home, and as I said earlier, my football team just got promoted to the Premier League.”

Sunak later told ITV that he would stay in the UK “for years” to come.

The prime minister also struggled to say how his national service policy would work, refusing to clarify what fines or incentives would make it mandatory for 18-year-olds. One minister claimed that it could involve parents being fined if their grownup children did not comply, before another party official appeared to rule that out.

The former defence secretary Ben Wallace defended the policy by appearing to suggest young people had few demands on them. “Heaven forbid young people are made to do something …,” he said.

Jonathan Ashworth, a Labour shadow cabinet minister, said the policy was “continuing to unravel” and that the Tories could not just “shrug their shoulders” about the detail of what young people would be asked to do. “That will not do. Rishi Sunak cannot announce the flagship policy of his general election manifesto but then refuse to answer the most basic questions about how it will work, and what it will cost,” he said.

…sure…you ask keir…they’re taking the money to pay for it straight out of their own “leveling up” fund…so…screwing the north…& money labour would spend on the NHS…or…if you crunch some different numbers…that the tax break they’re trying to squeeze in for the retired people who’ve been reading the telegraph & the mail since nige were a nipper & would vote for them anyway if out of nothing but muscle memory…is balanced out by extra taxes right across the range where the tax base is broadest…so…around the 30K-40K “squeezed middle”…or median, I suppose…iirc…because that’s just logical for a conservative party in the UK…for all that it makes the UK sound like a nature reserve for lunatics to a rational observer with a bit of distance from having skin in the game…actually…on the draft thing…the distance seems optional, actually

Rishi Sunak’s general election pitch inspired a wave of Gen Z memes. “If you can fix your parents’ iPad, then you can fix an Apache helicopter,” said one TikTok. [WaPo]

…when the washington post has noticed the bitch-slapping you’re getting in memes…looking red-faced is the least of your fucking worries…but…I’m biased…& of a certain age…I mean…the one that’s made me laugh the most so far a bunch of gen z wouldn’t even get…it was a still from this bit of withnail & I

…but rishi…saying “I’ve called an election by mistake”…& that tickled me something fierce, I can tell you…even if it makes no bloody sense, either…it wasn’t by mistake…it was because he can’t decide if the party or the country is the more impertinent bunch of bastards for not fawning over him the way his whole life tells him he’s never not deserved…if you ever want to pick a row about how dumb the definition of “white” in “white privilege” needs to be for the term to apply every time that’s the privilege you mean…read up on who rishi is…& how he came up…even before he married the lady of exorbitant wealth…& that isn’t me trying to be all #not-all-whites about it…not like you need to cross any borders to cover examples of that part…or even pick a fight with virtue-signalling about implicit bias…if you don’t need to put quote marks over the virtue part…I don’t got beef with you that’s even close to the top of my list…& one day maybe you’ll figure out what unconscious & implicit & the like actually mean & why getting people who those terms apply to into a headspace where those fundamentals run down different neural pathways isn’t something you tend to achieve by making them grouchy & defensive…but…look that shit up & get back to me if you think that’s an outrageous statement…because I assure you it’s really an understatement…the man might not admit it but he’s mad that the man on the street…or “the clapham omnibus” isn’t too busy doffing his cap & calling him “guv’nor” & thanking him profusely for that furlough business putting food on his locked-down table…even if that footballer did have to embarass them into covering the gap where his kids’ free school meals used to go because they thought they could pocket the small change they were spending on those while the kids weren’t going to school…or kick out shit that would have embarrassed the embarrassingly-shit “packed lunches” we used to get on field days…& that’s saying something when those came in at about a dime a pupil even back in the day & even the biscuit was discount…for being stale…which takes doing with modern shelf-lives…but I’m getting lost down a tangent & I haven’t even got through a single fucking piece about one election in one place…I tell you…I don’t know if I’ll make it six weeks…bring on the thoughts & prayers?

The prime minister also struggled to say how his national service policy would work, refusing to clarify what fines or incentives would make it mandatory for 18-year-olds. One minister claimed that it could involve parents being fined if their grownup children did not comply, before another party official appeared to rule that out.

The former defence secretary Ben Wallace defended the policy by appearing to suggest young people had few demands on them. “Heaven forbid young people are made to do something …,” he said.

Jonathan Ashworth, a Labour shadow cabinet minister, said the policy was “continuing to unravel” and that the Tories could not just “shrug their shoulders” about the detail of what young people would be asked to do. “That will not do. Rishi Sunak cannot announce the flagship policy of his general election manifesto but then refuse to answer the most basic questions about how it will work, and what it will cost,” he said.

…oh…come now, jonathan…you know you’re telling porkies, too…of course they can shrug those shoulders…that’s the whole point…this is reflex shit…labour threatens the electorate with a demographic shift in favor of the youth…their opponents swing a counter-punch aimed to have their trusty old-guard feeling their oats by resonating on some frequencies about making the shiftless laybouts…that don’t know how good they have it or who paid those dues for them…apply themselves & learn about what…well, these days it’s not really their generation so much as their parents’ generation that actually laid down their lives or endured the fighting part of the war-after-the-war-to-end-all-wars…but they knew all they ever needed to know about living through privation…it’s not rocket science…it’s naked triangulation…they just will not say it…or any other fucking thing…”in so many words”…& not because I’m such a long-winded whinging pom…the other thing

The national service plan is part of a Conservative attempt to win back former Tory voters from 2019 who are now tempted by Reform.

The prime minister announced on Monday night that the party would give a new £100-a-year tax break to pensioners by increasing their personal allowance, as part of his continuing drive to win back older former Conservative voters who are saying they intend to vote for Reform.

Billed the “triple lock plus”, the policy is estimated to cost £2.4bn a year by 2029/30, a price tag that mirrors Sunak’s proposed national service duty, billed at £2.5bn a year. The tax cut will be funded through a previously announced plan to raise £6bn a year by the end of the next parliament by clamping down on tax avoidance and evasion.

…not from chaps that can afford a decent accountant, mind…but it polled better with focus groups when they used the “avoidance and evasion” part because it makes people think of those people & the effective tax rate paid by them & their wildly-profitable businesses…like…jacob rees-mogg & his mob…or…nige out there whipping up that reform vote…united by their dropping GB news from their income streams because they have better cost:benefit options available that leave all the risk to the electorate & reward them whatever the verdict…damn it…this might be the one…I might never come out of this mire I went & dipped my toe in this morning…god damn…oh…speaking of god-damned things

Some Conservative MPs, however, told the Guardian they were worried that the focus on potential Reform voters would sacrifice a lot of home counties seats to the Lib Dems, including ones such as Surrey Heath, where Michael Gove announced that he would not be standing again on Friday.

…if that’s the last I have to hear about him…maybe there’s hope…probably not…but I’ll take any solace I can find…that’s just the reality of the thing, I’m afraid…take what you can get is about the best case scenario

“The base problem is, they had some things ready, like the framing and the moment they were looking for. But the operations side of things has not really been ready, the media and messaging has been all over the place. They kept it so tight, but maybe not everyone was in the room who needed to be. They just weren’t quite ready enough for this,” one insider said.

Another strategist pointed the finger at the election guru Isaac Levido for allowing mistakes to occur, and “a narrative of the campaign being in crisis” despite briefings that the adviser had been among those pushing for an autumn election rather than a summer one. An internal Tory memo leaked to the Times showed party staff complaining about a lack of MPs and candidates getting behind the campaigning effort.

…election guru…& I suppose I’m a faqir…fucking gimme a genie & see what kind of hat-trick my wishful thinking would serve up…I fucking dare you…if I don’t expire from apoplexy first…as seems entirely more likely

“It’s disappointing.[“] [Johnny Mercer, a Tory minister and MP for Plymouth] [said] [“]I like Lucy, but ultimately it is true that if you vote for Reform, you’re going to see Keir Starmer in Downing Street, and that doesn’t have any sort of intellectual sense about it if you want to vote for any of the Reform policies. So a vote for Reform is a vote for Keir Starmer.”

https://www.theguardian.com/politics/article/2024/may/27/sunak-struggles-to-control-tory-party-on-chaotic-fifth-day-of-election-campaign

…oh, johnny…johnny boy…you poor summer child…you realize you’re invoking the spectre of tactical voting…you see that…right?

…you do not want that smoke, johnny…or your johnny-come-lately ass is going to be late in the sense of your electoral prospects pushing up dasies…but that is a whole other can of whup-ass…& I’m just now putting a lid on that piece…so…resisting temptation…sort of

For a man who wants to win an election, Rishi Sunak’s first week of campaigning has been bizarre, a little bit frightening, like getting trapped in someone else’s anxiety dream. He went to the king for signoff before he told the cabinet, and presented 4 July to them as a fait accompli. Even if they had agreed with the decision, they wouldn’t have liked that, but they didn’t and they hated it. Only Oliver Dowden thought it was a good idea, which is a category of disaster all its own: “things only Oliver Dowden thinks are a good idea”.

…understand…this is supposed to invoke that famous birthright of understatement & irony…think damning with faint praise…except without the praise…but making up for it by being extra faint…& maybe throwing in the odd feint to top things up

I’ve genuinely never seen a prime minister so isolated, so undefended. I can almost hear David Attenborough narrating over each appearance: “Separated from his herd, the antelope has just days to escape the plain before the hyenas catch his scent.”

…if I’d written it up as a treatment & shopped it around trying to get the next “in the loop” made…no bastard would believe it wasn’t fiction

to Northern Ireland, where people couldn’t vote for him even if they wanted to because he’s not fielding any candidates, and he chose a precinct, the Titanic Quarter, as if begging journalists to ask him about sinking ships. There was time for a quick photo op on a plane, garlanded by signs that said “exit”

…davey-boy cameron said he’d stick around, too…before he lost a vote…& as danny dyer once memorably put it…’ad it away on ‘is trotters

…sorry…that one’s “with his trotters up”…& I don’t have time to find the right one…don’t need a truffle-hunter to sniff out why he kept dipping in the pig-metaphor well, though…even if you can’t go the full black mirror on primetime…or daytime…tv…yet

After only 72 hours – though, to be fair, it must have felt like years – he took the unusual decision to retire from campaigning and think. Was it blue-sky thinking, or was he sitting in front of ChatGPT, prompting: “Ideas Reform voters – who think they fought a world war, but were actually three years old – will like”? He emerged with a plan even the army hated – bringing back national service, for a generation who have been kaleidoscopically betrayed by successive Tory governments.

…let’s just put it this way & be done with it…for the sake of my blood pressure…it’s a topsy-turvy business at the best of times…& these aren’t those…so…sure…we might be through the fucking looking-glass…it could hardly make less sense…so why the fuck not?

Sunak underscored how very serious he was about the policy by saying that he would be happy to see his daughters, born in 2011 and 2013, do national service. He was asking us to believe in a world where he wins this election; he is able to enact this astronomically expensive policy that everyone hates; he remains in power, or at least in the UK, for the next seven years; and his daughters, who definitely won’t be living in California by then, will be conscripted.

But is he really asking us to believe that completely ludicrous sequence of events? This whole fandango makes a lot more sense if he is actually trying to lose. Foregrounding yourself in the first place, when you are sharing the all-time record low approval rating with John Major, from 1994, is not the decision of a man who wants to win. While any individual mishap could look like bad luck, the sheer buildup of them, the unforced errors, the repeated ones, the elegant rhythm as each pratfall is eclipsed by the next – it all looks so deliberated that we have to at least admit the possibility that it is deliberate.

There is an interesting phrase that Sunak keeps using, which is that Keir Starmer “thinks he can just waltz into Downing Street”. It is as if the Labour leader were somehow illegitimate in contesting the election, a bit of a chancer. You want to sit Sunak down and explain how this democracy lark works; if enough people vote for you, then, yes, you are indeed the rightful holder of the office, and therefore entitled to waltz – or, if you prefer, walk normally – into its residence. Sunak should know that, except he did waltz into Downing Street without the preliminaries. Now he looks, talks and acts like a man trying to waltz back out.

Is Rishi Sunak actively trying to lose the election? Let’s consider the mounting evidence [Guardian]

…of course that flight of fancy comes crashing down to earth when you consider the parallel that candidate russian-word-salad would then be running to go to jail…for all that it isn’t the draft the people rishi’s appealing to didn’t have to have applied to them & a fairly small proportion of the teens would actually get near active service…I’d argue there’s a clear through-line to the “logic” that makes the other guy™ attempt to parlay his legal woes into a threat directed at his voters into being-under-indictments-is-an-electoral-asset-asshat…it’s like that insane thing about the über-natalists & their toddler-slapping proclivities…the countries with below-replacement-level birthrates…they overwhelmingly have the lion’s share of the wealth the whole industrial-revolution-capitalism twofer delivered…& they want to keep the world in that sort of working order…but…their kids cost a lot more…in a bunch of senses…&…if you asked malthus he’d tell you we’re overdue a correction on the population growth…so…shrinkage might even be the responsible way to go…& if the kind of thing that gives us give-’em-an-ipad-&-the-occasional-slap-to-the-face as a parenting school for parents planning to home-school a brood they think can move a demographic needle says it isn’t…but…is also fucking wrong-headed on a scale that makes you want to rotate your head past snapping & projectile vomit like the girl in the exorcist…there’s got to be a flaw in the logic somewhere…&…it’s not a popular perspective…but…politely…I offer you one of the pillars of the capitalist paradigm…there must & shall be growth…all else is disaster…when you think about that part…tell me things don’t get squirrely…actually…don’t…I don’t want to call you a liar…it’s nice to get along with people & I happen to like y’all

Yet despite mounting evidence and urgent pleas, meaningful action falters. Global prosperity has historically emerged from fossil fuels. But the stranglehold of fossil fuel giants, generously subsidised by governments and financially backed by banks, places short-term profits over the planet’s survival. This entrenched dependency stymies efforts to transition to a sustainable future, despite the urgent need for change. GDP growth remains sacred, while climate, biodiversity, health, and social equity are sacrificed, condemning future generations to inherit a ravaged planet.

I say this acutely aware of how making such statements can appear as virtue signalling, particularly to those in the global south, where development is still taking hold. This is not primarily about denying them their pathway, but changing where those of us in the developed world stand – and perhaps our final destination.

On our current path, civilisation as we know it will disappear. If we meet current commitments only – net zero by 2050 – perhaps some form of humanity will survive, managing the challenges of continued extreme weather events, ice loss, and sea-level and temperature rises. But we have agency to change this, and a thriving future is still on the table. To grasp it, we must embark on a radical journey encompassing an essential “4R planet” pathway.

…I’ll lay off…but…”as we know it” is doing the kind of lifting in that sentence that makes the barbell bend like a bow in the snap & jerk…just sayin’…that “4R planet”…we don’t know it…we struggle to fucking imagine the thing it’s so far out of the realm of our collective experience

…but the romans could say that about the information age…& plenty of shit marcus aurelius meditated on…or ruminated about…is plenty applicable now…some of it aged better than menken, even…so…civilization might have in common with the planet that it’s considerably more resilient than most definitions of the things looking to doom it like to admit…& if we want all our creature comforts & some surviving creatures to go along with them…then we need to go about getting our god-forsaken act together & make that shit happen…because “shit happens” is gonna drown us in a rising tide of bullshit the way we’re all content to see the game played & I fucking resent the way my reaction to the shit I’m served for breakfast makes me sound like some foaming-at-the-mouth radical just for feeling like maybe we aren’t doing ourselves any favors & that might not be unconnected to the “grace & favor” contingent…there but by the grace of god…unless the right people owe you a favor, I guess

…I’m…I dunno what I deserve in the label-stakes, honestly…but…I’m not a natural fucking radical…I know that…I find the business-end of revolutionary change…problematic…unappealing…any number of things I’d sooner reach for than a fucking guillotine…however much I might be unable to furnish a single reason why the continued existence of a laundry list of usual suspects is in anyone’s broader interest…& maybe that’s an example of the kind of thing himself means when he puts some mustard on “it got hard”

…but thanks to my trusty implicit biases…I don’t feel like he’s talking about me…so I got that going for me

[…anyway this is due…& I may be a while…so I’ll leave you to it here…for a while…& see if I can pull out of this nosedive before my whole day crashes & burns in an endless downward spiral…wish me luck…or take beau’s advice…& ask yourself “what happens next?”…probably about what you expect…at least as far as this post goes…but…it might not be as bad as you fear when it finally turns up…hopefully less than a day late even if it’s short all the dollars?]

…ok…so…skipping past all the wool being gathered for the purposes of being pulled over eyes in the traditional fashion that makes comfort zones so cozy…for conversational purposes…this is humanity’s value-add pitch to the planet

It is absurd to think, as some influential fossil fuel leaders claim, that we can continue our economies based on burning fossil fuels because scientists are finding ways to capture the emissions from continued use. Recent analysis shows that annual global GDP costs due to extreme weather events could rise towards 100% of global GDP around the end of the century.

Meanwhile, the transition away from fossil fuels is already under way, with renewables, hydropower, geothermal energy, distributed energy storage, electric transport and nuclear energy already operating at competitive economic levels. For instance, Kenya has already achieved more than 90% electricity production from renewable sources, an enormous advantage to its economy. The rate of global transition, properly led by government regulations and the removal of subsidies for fossil fuel recovery, could and should be increased tenfold. Implementing the four Rs must be seen as a proper risk management cost, offsetting the very large financial loss figures projected.

Today, the world is emitting over 50bn tonnes of GHGs annually into the atmosphere, expressed as CO2 equivalent. Since we are unlikely to achieve a removal rate exceeding 10bn tonnes per annum, there can be no way forward without reducing emissions to a very small figure.

Today, the GHG level in the atmosphere exceeds 500parts per million (ppm), compared with the pre-industrial level of 275ppm. A safe level for humanity is about 350ppm, so we must remove excess GHGs already in the atmosphere. At about 10-20bn tonnes per annum I estimate it would take to the end of the century. We must start this process immediately.

Additionally, we will need to repair ecosystems to buy time, or else we will be overwhelmed by the consequences of melting polar ice and ice from mountain peaks before GHG levels are reduced sufficiently. Repairing the Arctic Circle will be a major enterprise. Promising processes are under development but are hampered by inadequate funding. Two immediate projects worth supporting are: covering the Arctic Sea with bright white cloud cover during the three months of the north pole summer; and pumping seawater on top of the thin layer of ice formed over the sea in the polar winter to thicken it. These will cost billions of dollars annually, a small fraction of the costs of lives and damage avoided. Deployment of such projects will require global governance and collaboration rarely seen, but if not now, then when? If not for this cause, then for what?

…but even I can see how it’s extracting the michael to claim not to see why extraction on domestic territory is a vote-winner to people looking to undercut the leverage of major energy-exporting economic dominance on a global stage (…hat-tip to the US’s status as a net exporter, there…gas price:electoral prospect ratio notwithstanding) …political realities don’t need to be realistic realities to be the real deal

Funding for the development of the four Rs will fall on advanced and emerging economies. Heads of G20 countries must lead the way. Vision and understanding from our leaders, coupled with a global public demanding more, are essential. Beyond policy changes and investment, a seismic cultural shift is imperative to steer humanity away from self-destruction towards a just and sustainable future. We must realign our political will, economic priorities and societal values to recognise that ecological wellbeing is matched to human wellbeing.
[…]
We are a part of the natural world and depend on it. We can choose to transition our societies into a sustainable period of ecological civilisation. Over the coming decades, as we are faced with a self-inflicted set of global challenges, the need for such a cultural transformation will drive action. This process must begin now.

Humanity’s survival is still within our grasp – just. But only if we take these radical steps [Guardian]

…I mean…I quibble about the definitions of humanity & survival being worked with…but…say we grant those…how in the ever-loving-fuck do we hop, skip & jump to making out the pro-survival-of-humanity position to be the one that’s fucking “radical”…what could be closer to the definition of a universal greater interest or a self-preservative instinct from the formative reaches of the pre-evolved brainstem

…look…forget about me…listen to the professional educated-guess-havers…like…I dunno…this guy

Good morning. I spent much of last week in Venice, for the FT’s Business of Luxury summit. I am happy to report that only one attendee fell into a canal (he was fine), that the luxury industry remains in rude health (even if the wild post-pandemic boom is ending), and that Tintoretto has moved up smartly in my personal rankings of the greatest painters (Velázquez and El Greco still secure in the top two spots). Send me your top 5: robert.armstrong@ft.com.

…if bob’s your uncle…sorry about that?

Something happened to the valuation of US stocks about thirty years ago. Take, just for one example, Robert Shiller’s cyclically adjusted PE ratio (the S&P 500’s price divided by its 10-year average earnings). Through 1995 it looked like a well-behaved mean reverting series, where the mean was about 15. Since then it has looked like a somewhat more volatile but still mostly mean reverting series where the mean is about 28:
[…]
If you think valuations are an important if imprecise indicator of long-term returns (as I do) this is important, and vexing. Even if you are prepared to accept that something about valuations changed thirty years ago (as many value investors struggle to do) the fact that it changed demands an explanation. If you don’t understand this, how can you know that another change is not approaching, or is not already here? Granting there is a statistical relationship between valuations and long-term returns (some think there isn’t), if you don’t understand why the relationship changes through time, it would be foolhardy to use it for decision making. 

I have been thinking about this problem without coming to any particularly firm or useful conclusion for an embarrassingly long time.

…look…he said it…I didn’t…& his “best guess” invokes inflation…which…not least thanks to inflation…is above my pay-grade but reaches my pay-check just fine…so…there go those implicit biases again

Another possibility is that the last several decades have just been really strange. They have featured two epic bubbles, a once-in-a-lifetime financial crisis, a revolution in monetary policy and a global pandemic. Maybe it would be unrealistic to expect any market regularities to hold in such a whirlwind, and old patterns will reassert themselves eventually. There could be something to this, but looking at a 30-year period and declaring it anomalous is a little more than the social scientist in me can bear. 

…sure, bob…old patterns are sure to reassert themselves…you can rely on that…like the weather or the passage of the seasons or…*checks notes*…nevermind…we were just getting to fun (& profit) with math

Shiller himself was bothered that for many years his Cape ratio has been very high while stocks rose ever higher. His solution was to adjust for interest rates. His “excess Cape yield” (ECY) is the reciprocal of the Cape multiple, expressed as a percentage, less the real return on 10-year Treasuries. As it is a yield rather than a multiple, a higher ECY means stocks are cheaper. And historically, the ECY does seem to do a pretty good job of signalling good and bad times to buy equities. That said, while at the time Shiller first introduced the ECY in 2020, it did make the S&P 500 look more reasonably priced than the classic Cape ratio, it no longer does, because rates have risen sharply and stock prices have risen too. Just like with the Cape, there are quite distinct pre- and post-90s ECY regimes. Before, the average ECY was about five per cent; now it is half that level (and right now, the ECY is at a revolting 1.2 per cent).

…speaking of fun with math…rishi says his boffins crunched the numbers & to get all the goodies labour is claiming they offer would average out to about 2 grand per taxpayer in extra taxes

…& you know what…that sounds like a fucking bargain on the order of the one ukraine sticking it to your man vlad like they’re the impaler returns on its investment…if you ask me…& I don’t necessarily have that kind of pocket change down the back of the sofa…which feels meaningful, somehow…in terms of my investments & vested interests

…any road…bob’s boy jim has not 1 but 5 explanations…so…five times better than an explanation…that’s just math

https://paulsenperspectives.substack.com/p/a-different-view-of-valuation

I think the first two ideas are compelling and interesting, and the third and fourth are not. Starting with the bits I disagree with, I can’t see how the difference in liquidity between now and 30 years ago is enough to explain a significant move in average valuations. Stocks are more liquid now, but you did have daily liquidity back then, and on very bad days — the days that really matter — liquidity is still a problem today. Also, it is worth noting that low-liquidity assets — private equity and debt — do not trade at much of a discount in today’s market. 

On productivity, I agree with Paulson that productivity is the most important thing, in the sense that it is the most important driver of growth, for both economies and businesses. From an investor’s point of view, however, what matters is profit levels and profit growth, not their drivers. At best, an explanation of valuations based on higher productivity is reducible to an explanation based on higher growth. If productivity growth is good for valuations, it is because it means higher growth rates.

…look…I don’t think productivity is the alpha & the omega…I…just don’t…not really…I think if you’re going to have a be all & end all & not having all the being be the end of all of us is on the table…I’m gonna go with that…please & thank you…but I’ve always been told I’m a little odd

This leads us to Paulsen’s second point, that the market contains more growth stocks now. This explanation makes broad sense, but it makes me somewhat nervous, because I think growth rates are very hard to predict. Higher future growth in profits must, all else equal, be reflected in a higher valuation, if asset prices are the present value of future cash flows. And if we look at the current crop of huge, dominant growth companies and their powerful market positions it is easy to think that their growth rates will persist. History teaches us, however, that dominant positions in markets, including tech markets, can disappear rather quickly (General Electric, IBM, Nokia, et al). It may be that today’s tech companies enjoy semi-permanent “increasing return to scale” dynamics that will help their growth persist for longer than past companies’. But I’m just not sure.

…I dunno if you watched that first TED talk from sunday’s one of these little constitutional exercises…but…if you did…this would be around where the blinking lights indicated tech allegiances & the options were bi-polar or indivisible…or…you know…the only game in any town to the exclusion of all else possibly up to & including us…AKA the bit where the mercator projection vanished from the projection which suddenly made the big screen out to be a narrow overton-esque window in a much bigger picture the totality of which was now entirely overwritten…you know…while we’re getting comfortable with the couching all this is sinking into gratefully & all

Valuation matters. The idea that what price you pay for a financial asset does not matter to the future returns from that asset is a non-starter. But how to best measure valuations, and how to best deploy those measurements in decision making, remains a very tricky question. 

The valuation mystery [FT]

…wait…no, really…back up a minute…”what price you pay for [thing of value] does not matter to the future [value of that thing]”…even if the thing of value is “the only known incidence of an ecosphere receptive to being not prohibitively hostile to the existence of us lot” & the future value of that thing is…on fire…because…”it’s a tricky question“…says…*checks notes*…the just-back-from-venice’s “Business of Luxury“…umm…”summit”…zero irony detected…where “the luxury industry remains in rude health (even if the wild post-pandemic boom is ending)“…& luxury still means “thing absolutely not necessary in order to be alive even in rude health”

…it’s no good

…I had more…like…really a lot more things I had a mind to get into when I sat down…& I’m not just saying that for effect…things I think are worth thinking or even talking about…some of them more important than any of the crap I’ve ended up wittering on about instead…& it’s not the first time that feels like I might be offering a case study of a thing that that also doesn’t do us any favors…but…I fucking can’t…not if I’m going to get anything constructive done today…let alone find some fucking tunes as a congratulations-you-made-it-to-the-bottom-with-your-thumbs-intact consolation prize for putting yourself in proximity to my poly-graphically prolific misery this morning

Should Elon Musk be paid $56 billion? Tesla shareholders get to vote [NBC]

The rise of ‘abortion abolitionists’ targeting women, doctors and Donald Trump [NBC]

Trump doesn’t submit paperwork to be considered by Libertarian Party after soliciting votes [NBC]

Elon Musk’s AI startup now valued at $24 billion after fresh funding [NBC]

…when the mistakes of the past are your gravy train…of course you want people to repeat them while learning nothing…stands to reason

In India, voters sweat their way toward the end of the election [NBC]

…hands down the biggest election in the world in the world’s biggest bumper crop of epoch-defining elections…don’t sweat it…modi says god sent him…it’ll be fine

I’m an Indian Muslim, and I’m Scared to Say So [NYT]

…pish, tosh…you’re just making a molehill out of a mountain…well…it’s not their fault if the metaphors get mixed & muddled & muddied…& what do you mean it’s not that kind of earthwork…haven’t you heard…man-made changes to the current climate aren’t even a thing

What Do I Owe the Dead of My Generation’s Mismanaged Wars? [NYT]

The Stench of Climate Change Denial [NYT]

…two totally separate things…& you’re a fool & a communist if you think otherwise…oh…& you hate humanity & want it to die, too…it’s like being a self-hating jew…minus the -semitism…because we don’t do things by halves, see

Americans see disparities in mental and physical care, survey finds [WaPo]

…huh…maybe sometimes they do just state the obvious after all…who’d a thunk?

Russian disinformation in Europe sounds an alarm for U.S. elections [WaPo]

…there’s something for everyone…bring the kids…fun for the whole family

‘Nothing justifies what we have witnessed here’: the doctors returning home from Gaza [Guardian]

Trump tells donors he will crush pro-Palestinian protests if re-elected [Guardian]

Global shock after Israeli airstrike kills dozens in Rafah tent camp [Guardian]

Biden honors troops on Memorial Day as Trump lashes out at his ‘human scum’ enemies [Guardian]

…we used to know how to do this, even

‘Freedom was around the corner’: how UK activists helped the exiled ANC to defeat apartheid [Guardian]

…look…apologies for borrowing beau for short-handing purposes when all I’m giving is short shrift

…I know it’s…overly simplistic?

…but…although I stumbled across it on you tube rather than as a podcast, per se

…I caught the episode of bernie’s podcast that had him chatting to AOC…&…maybe she’s embellishing some truths…maybe the “people from the neighborhood” she remembers being her only allies when trying to get on the ballot was the gesture she thought she could maybe make weren’t as scrappy & few as it helps to have them sound…maybe they were…I don’t know…I wasn’t there for that part…but…I’ll say this for moments of candor…right near the end when they’re mutually-appreciating to an extent bernie hints might be unattractively in the line of things-career-politicians-do-when-left-among-themselves…she thanks him for the fact that if he hadn’t fought for the incremental legislative gains back when she was a kid who’d never heard of him…much less heard him & taken any messages to heart…she wouldn’t have had health care

…that landed for me?

…the other thing that felt like I felt it as much as heard it?

…might not have it verbatim…but basically the part where she said something like

Living in America as a member of the working class…is radicalizing

…can I get an “amen”?

…sure…now I’m realizing I ought to have turned that lot into a scroll-saving playlist…but…fuck it…it’s just that sort of day…disappearing red square with an up arrow on your bottom right…comment count for the skip past…two clicks…no scrolling…all comments, all day…just…roll with it…because I’m way off the pace today?