The Sunday Drive - 03/17/2024 Edition [#102]

Musings and Meanderings of a Financial Provocateur

A Sunday Drive Around the Internet

👋🏼 Hello friends,

Happy St. Patrick’s Day! ☘️

I hope you have a fun and safe celebration, one that is in keeping with your sensibilities and within the bounds of the tolerance of your liver. 🍺🍺

Now, let's enjoy a leisurely Sunday Drive around the internet. 

🎶 Vibin'

My family and I lived for nearly 30 years in the Boston area before departing for upstate NY a couple of years ago. There are many things that are uniquely Boston of course.

One of those is the tune I’m vibin’ to on this St. Patrick’s Day. Please enjoy I’m Shipping up to Boston from the Dropkick Murphys 2005 album, Warrior’s Code. Gritty, but memorable, especially for those who have lived in Boston.

💭  Quote of the Week‌

“People who wonder whether the glass is half empty or half full miss the point. The glass is refillable.” – Simon Sinek

BONUS QUOTE
“The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.”
– Friedrich August von Hayek

📈  Charts of the Week

Most folks are well aware of the birth dearth and accelerating population declines facing the developed world in the decades ahead. Led by Japan and China, followed by Europe and then the U.S., aging societies face unprecedented obstacles to sustaining growth and societal wellbeing. How we deal with these obstacles, and to what extent we make good and productive use of emerging AI and other tools to overcome them, will have enormous implications for productivity, economic growth, and investment returns.

The second Chart of the Week reminds us that the U.S. is a nation of immigrants. A variety of ethnic groups from across the globe, including the Irish (**nod to St. Patty’s Day**) have come to our shores over the course of our history and helped build, in my opinion, the greatest nation the modern world has ever known.

To a great extent, the recent wave of immigrants, legal and otherwise, will help arrest the organic population decline resulting from our own birth dearth. If most of them choose to assimilate and become productive members of our society, we can maintain our comparative advantage over other nations in the developed world.

🚙 Interesting Drive-By's

This week we have articles on population decline, ambition, Hayek’s Nobel Prize, and progress:

📉 How Population Decline Could Upend the Global Economy - from Jared Franz of Capital Group

China recently joined the long list of countries that had more deaths than births in 2023, underscoring a declining population trend that could upend the global economy. Demographic changes have major implications.

The United Nations predicts the world will reach peak population around 2086, but I think that figure may be optimistic. One reason is because the pandemic-era baby bust in some countries may have worsened the decline, and the problem appears to be long-lasting. Even in certain African and Latin American countries, where birthrates are historically high, the number of newborns has dropped closer to the replacement rate of 2.1 children per woman. Given these trends, humanity’s population could peak around 2050.

But what does a planet with fewer people mean for society? It’s a position the modern world hasn’t been in, so we would be crossing a demographics Rubicon.

Demographics influence what people buy and a company’s revenue potential. From an economist’s perspective, it helps determine monetary policy and, ultimately, the well-being of each successive generation. [More HERE]

📈 Ambition’s Gravity - from Packy McCormick

Aside from the doomers who believe that AI will kill us all and the techno-utopians who believe it will solve all of our problems, there are three main ways that people seem to be thinking about AI. 

At one extreme, you might fear that AI will take your job. Certainly, you’ve read as much in the press, and it does seem to be getting better and better at the things you’re paid to do. On this extreme, AI is scary. 

In the middle, you might feel AI FOMO, feel that you need to “learn AI” or “leverage AI” because everyone else is doing it and you don’t want to miss out. From this position, AI is overwhelming: how can you ever keep up? 

A third, far more productive approach is to first determine what you uniquely want to accomplish with your life, and then view everything, including AI, through the lens of whether it helps you accomplish your goal. From this perspective, AI is a tool and you are the one who wields. [More HERE]

🤔 Remembering Hayek’s Remarkable Nobel Lecture - from Lawrence W. Reed of Foundation for Economic Education

Thirty-two years ago this month—on March 23, 1992—Austrian economist, political philosopher, and Nobel laureate Friedrich August von Hayek passed away at age 92. It is not upon that sad occasion I dwell here, but rather, on the 50th anniversary later this year of his acceptance speech at the Nobel ceremonies in Stockholm, Sweden. What a glorious moment it was!

From 1969, when the first Nobel in Economic Science was awarded, until Hayek’s win in 1974, I was among many who yearned for the day when a genuine friend of freedom and free markets would be so honored. It seemed every year that the award went to someone for attempting to quantify the unquantifiable, to count the angels on a pinhead, or to whitewash statism. We despaired, as Adam Smith surely did from the grave.

Then in 1974, Stockholm fired a shot across the Establishment bow by recognizing Hayek. Two years later, Milton Friedman won the prize. In the decades since, more economists friendly to markets claimed it—including such luminaries as George Stigler, James Buchanan, Ronald Coase, Gary Becker, Robert Lucas, Robert Mundell, Vernon Smith, Elinor Ostrom, and Angus Deaton.

Even so, the Nobel Committee in 1974 couldn’t bring itself to give that year’s Economics award to Hayek only. It “balanced” him by also bestowing one on the Swedish socialist Gunnar Myrdal—whose arrogance showed itself when he turned his nose up at Hayek. The latter was always gracious; if he harbored uncomplimentary views of the crackpot Myrdal, he never said so in public. The smug, state-worshiping Swede argued the prize should be abolished if central planning skeptics like Hayek and Friedman were given it.

All these years later, almost nobody remembers Myrdal, and fewer still ever quote him. Practically no one recalls a good book or a memorable phrase he penned. His own country, Sweden, turned away from his naïve presumptions and now boasts the 9th freest economy in the world.

Hayek, however, is cited somewhere every day, if not every hour. The Road to Serfdom, The Constitution of Liberty, The Denationalization of Money, and The Use of Knowledge in Society are four of his many works that millions around the world have either read or heard of. I could take a nice vacation if I claimed fifty bucks for every instance in which I have quoted just this one of many Hayek gems: “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” [More HERE]

💡 What is Progress? Or, Progress Toward What? - from Jason Crawford

In one sense, the concept of progress is simple, straightforward, and uncontroversial. In another sense, it contains an entire worldview.

The most basic meaning of “progress” is simply advancement along a path, or more generally from one state to another that is considered more advanced by some standard. (In this sense, progress can be good, neutral, or even bad—e.g., the progress of a disease.) The question is always: advancement along what path, in what direction, by what standard?

Types of progress

“Scientific progress,” “technological progress,” and “economic progress” are relatively straightforward. They are hard to measure, they are multi-dimensional, and we might argue about specific examples—but in general, scientific progress consists of more knowledge, better theories and explanations, a deeper understanding of the universe; technological progress consists of more inventions that work better (more powerfully or reliably or efficiently) and enable us to do more things; economic progress consists of more production, infrastructure, and wealth.

Together, we can call these “material progress”: improvements in our ability to comprehend and to command the material world. Combined with more intangible advances in the level of social organization—institutions, corporations, bureaucracy—these constitute “progress in capabilities”: that is, our ability to do whatever it is we decide on. [More HERE]

🤷🏼‍♂️ Bitcoin Hits 70,000 and all the Crypto Bro’s be like…

👋🏼 Parting Thought

Once again… Happy St. Patrick’s Day! ☘️

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If you have any cool articles or ideas that might be interesting for future Sunday Drive-by's, please send them along or tweet 'em (X ‘em?) at me.

Please note that the content in The Sunday Drive is intended for informational purposes only, and is in no way intended to be financial, legal, tax, marital, or even cooking advice. Consult your own professionals as needed.

‌I hope you have a relaxing weekend and a great week ahead. See you next Sunday...

Your faithful financial provocateur,

-Mike‌

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