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Archived Posts for September 2022

25
Sep 22
Sun

Weekly Report: September 25, 2022

Observations

  • The Fed raised rates by 0.75% to an upper bound of 3.25% this week. The market expects further raises to 4.25% or 4.50% by the end of this year, and the market reacted accordingly. The U.S. dollar continues its inexorable run upwards against every other major world currency. The yen hit a 24 year low (146 JPY to the dollar), prompting the Bank of Japan to intervene and prop up their currency for the first time in as many years. The pound hit a 37 year low (falling to $1.084), and the euro a 20 year low (falling to $0.9689). The Australian dollar “only” hit a 2 year low (at $0.651), having sharply plummeted to under $0.57 during the early days of the pandemic. Interest rate differentials will encourage further USD inflows, which will continue until U.S. interest rates pull back, and a recession bites. (If the recession is global, which I think is likely, the USD may continue rallying for a while due to flight from risk.) If the past is any indication, the time the Fed starts cutting rates will roughly coincide with the start of a crash and subsequent recession. Susanne and I have been slowly buying Australian dollars and Danish kroner (which is pegged to the euro) on the bet that these historically low rates won’t be a high watermark, and things will recover in a few years.
  • A second company fell prey to a high profile hack in as many weeks: Take Two (which actually got hacked twice). While details about the Take Two hacks are sparse, I’d wager that, like the Uber incident, it all started with a social engineering attack.
  • Susanne is already regretting telling me about this, but KOKS, a Michelin-starred restaurant in the picturesque Faroe Islands, is temporarily moving to the small village of Ilimanaq, Greenland next summer. If you want to dine inside the Arctic Circle, you have to buy a package deal, which comes with a boat transfer through a fjord from nearby Ilulissat, and a hotel night (KOKS will also feed you breakfast). It sounds incredible, but the logistics of pulling off a trip there are imposing.

Articles

Charts, Images & Videos

Data: YCharts, Chart: Simran Parwani/Axios

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18
Sep 22
Sun

Weekly Report: September 19, 2022

Observations

  • Inflation numbers remained high this month. The market expects the Fed to continue hiking interest rates at a good pace and reacted accordingly. Mortgage rates rose above 6% for the first time since 2008. I think the pain of a sharp recession is still to come as the much of the world has become used to record low interest rates for most of the last decade. Higher rates have a knock on effect that will catalyze a downturn, causing a stronger USD, higher debt servicing burdens, decreasing demand, drying liquidity, and slowing the economy. Unfortunately, the worst is yet to come.
  • Adobe agreed to acquire Figma for $20B in cash and stock which, at signing, is the largest private tech acquisition in history. (In 2014, Whatsapp agreed to be sold for $16B, which rose to $22B at closing as Facebook stock rose.) Adobe shareholders and Figma users didn’t love the news, but early Figma shareholders did.
  • Andor, the latest Star Wars series, is out on Disney+ next Wednesday and the reviews are apparently excellent.

Articles

Movies & TV

  • Star Trek: Lower Decks (Season 3)
    Started watching this season. The series is a lot of fun. And somehow, they still keep it canon!

Restaurants

  • Bluestone Lane Cafe (Los Altos)
    Billed as an Australian-style cafe, we go there occasionally for a weekend brunch. The food is a facsimile of a Sydney breakfast, but I’ll take what I can get. (They sell fairy bread there but use sprinkles instead of 100s and 1000s. Heresy!) Bonus: two free Tesla charging stations. 3/5.

Charts & Images

Our 4th blackout this year that has lasted more than 30 minutes. This time happened just as we were about to bathe the kids. No power means no hot water.
Mortgage rates. Source: New York Times

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11
Sep 22
Sun

Weekly Report: September 11, 2022

Observations

  • A heatwave lasting half the week in the Bay Area saw temperatures hit an all-time high of 47ºC. For us, temperatures exceeded 40ºC on 3 days this week, which makes working from home challenging in the afternoon as we don’t have air conditioning (typical for homes here). The southwestern U.S. is currently in a drought that is the worst on record (and the records — tree rings —go back 1,200 years).
  • Queen Elizabeth II died on Thursday. She led an incredible, unique life and felt particularly well respected and admired, despite having to carry all of the colonial baggage that the British monarchy brings. In the words of former President Trump, “There was nobody like her!” King Charles III now takes her place.
  • I was barely old enough to vote “yes” when Australia held a referendum about whether to become a republic at the turn of the millennium. The “no” votes prevailed, but the margin was only 55/45. I suspect that the next time they hold such a referendum, it will be within my lifetime and the answer will be different.
  • Sunday marks the 21st anniversary of 9/11. I’d say that every 20-30 years a generational event comes along and changes the world. The pandemic, of course, is the most recent one. 9/11 was the first in my living memory and I’m sure at some point my kids will ask me, “What were you doing when you found out about 9/11?” The answer is that I woke up to the news that morning. I think someone had texted me to turn on the TV, and when I did, I saw the shocking images of the towers burning. I was in Sydney, so it had all happened while I was asleep. After being glued to the TV for as long as I could, I left for work. I was a web developer doing an industry placement at EDS at the time, working on the Commonwealth Bank’s website. I grabbed an old walkman, popped on earphones, tuned into a news radio station, and hopped on the bus, and then the train. It was a pretty sombre, quiet commute, and you could tell the news was hanging in the air with everyone.

Articles

Movies & TV

  • House of the Dragon (Season 1)
    My wife and I started dating at about the same time as Game of Thrones premiered, and it became a weekly ritual for us (together with eating take out from Su Hong, now called Chef Kwan’s in Menlo Park). Despite GoT’s series-destroying final season, we decided to work House of the Dragon into our weekly routine for old times’ sake. We’ve seen the first 3 episodes, and the jury is still out on whether it’ll stay in our weekly routine.

Hotels

  • Courtyard by Marriott Redwood City (Redwood City, CA)
    I had an unused free hotel night that was going to expire next month, so I decided to work out of a hotel room on one of the days where it got really hot. I was just there for the air conditioning so I didn’t stay for the night, but it’s a basic, no-frills hotel in the middle of nowhere.

Charts & Images

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