Good morning. Hello. How are you? #643
Hrm there's actually an interesting parallel in here between the Afterlife of pop stars and the afterlife of companies when the Fed pulls back. Plus a little politics and a thing about mints.
Good morning, fair friend. How are you this fine Tuesday? Is it fine? It seems fine so far, but, you know. Don’t let your guard down. Days have a way of sneaking up on you. I’m listening to How the West Was Won by Peter Perrett, former lead singer of The Only Ones, who spent like 40 yers as a crack and heroin addict. I’m reading a kind of interesting book, Exit Stage Left: The Curious Afterlife of Pop Stars by Nick Duerden. It has a very simple and great premise: What happens to pop stars after their time in the sun? I take issue with a lot of Duerden’s meta-commentary around this phenomenon, he sort of tries to eract a comprehensive or coherent theory about what happens to them, but the theory is kind of a mess and goes into two opposing directions, they give up or they don’t, but also they stay successful or they don’t, but also they implode or they don’t. It’s muddled, because reality is muddled. We’re sick of pop stars after their moment in the sun, but also tons of firner pop stars are still playing on the nostalgia circuit because we actually can’t get enough of them. We only want to hear the hits but also… well, I guess most people only want to hear the hits, that part seems true. Though it’s not true of me, I still methodically listen to every new album by bands I loved “back in the day,” and many of my favorite songs by bands are on their later, post-stardom albums. Though I suppose most of the bands I listen to never really had stardom, per se, but, then, the book offered up Peter Perrett as its second case study, and the Only Ones’ biggest hit was “Another Girl Another Planet” and I’d say Mercury Rev or the Jesus and Mary Chain, for example, had hits that big. Anyway, theoretical scaffolding around the former pop stars aside, the actual stories and interviews with the subjects themselves are so utterly fascinating and compelling you don’t really care. When Duerden gets down to the nitty gritty of telling us what these people’s lives are like after stardom, he delivers in spades and it’s such a glorious, informative, voyeuristic adventure.
Feeling very down about politics today apparently we’re going to rush through some very important bill protecting the safety of Supreme Court Justices at their house? I mean, okayyyy….
To be fair, I haven’t actually read my morning daily email Politico Huddle about what’s going on in congress today, so just because some Senators are rushing through this bill doesn’t mean, I suppose, it will pass either house or get signed, but then again, who knows. We just decoupled Ukraine aid from Covid relief for Americans because, you know, It’s very important to rush and help people. In another country. I mean, I am no isolationist, and I am all for helping Ukraine, shit my degree is in exactly the opposite of isolationism, but if I were trying to think up an example of exactly the sort of thing that pisses people off about an “active foreign policy,” well, I’d say sacrificing billions of desperately needed dollars that will immediately save lives in America in the face of a disease that has killed ten times as many people (conservatively speaking) as the foreign war… well… that’s a pretty good example of why people get riled up. But, then, I suppose the opposing party in the United States is a death cult so, they’re hardly gonna get too riled up about it.
(Politico Huddle is great, by the way. Great daily newsletter about what congress is doing, or not doing, and whether these bills politicians extoll actually have any chance of success. After reading it for several years, my chief takeaways are 1) Man, congress is in recess a lot, and 2) they really need to get their act together with their food service workers and system, the whole thing is a giant mess, and the hilarious part is the Republicans say the whole system never should have been turned over to corporations, should have stayed nationalized, and blame the Democrats for farming out their food service to evil corporations, which is a hilarious reversal of the situation in the rest of the world, and also these people need to be unionized, stat.)
(Hello to the five new subscribers today who maybe thought this was an advertising newsletter? I don’t know. I don’t know why people subscribe to this. I did my best to warn you.)
I have come to the conclusion that the Peach Iced Tea flavor of Icebreakers mints are basically a limited-time offering, and they seem to have left my region, and I can buy no more of them. This is alarming since my ridiculous Icebreakers mints addiction is still going in full force, and the Peach Iced Tea flavor is my favorite. I broke down and ordered a nine-pack box of them off of eBay, jacked up only about 25% so not terrible. This will get me through a few weeks, but I’ll run out during my trip to Boston. Maybe I’ll luck out and in Boston they are still selling Peach Iced Tea flavored Icebreakers mints. God damn this addiction, though also thank you Icebreakers mints for assisting me with finally quitting nicotine for once and for all, a decade after I quit smoking. That is a huge accomplishment of the last year I keep forgetting about and not giving myself any credit about. Also being addicted to Icebreakers mints is not as bad as being addicted to crack and heroin and smoking thirty joints a day, on top of the crack and heroin addiction like Peter Perrett. Seriously. How did that dude live? Also Peter Perrett married his childhood sweetheart before he ever got famous with the Only Ones and they went through this multi-decade addiction together and then got clean together and wow, man, how did that relationship survive I have so many questions. Was one enabling the other? If so, which one? I am very embarrassed I have this very prying, inappropriate curiousity about things that are none of my business, but I must confess it to you, dem’s the rules.
So the Fed raised interest rates fifty basis points a week or two ago, signalling the END OF BOOM TIMES, or at least the end of the Fed pouring money into the economy at a relentless rate to prop things up. This is, to put it simply, sad. It’s sad on many levels. It means interest rates are rising so the housing market will cool, which is maybe a good thing because the housing market is insane, but it also means that it’s getting more expensive to buy a house, and lots of people still don’t own houses that want one, and housing starts were actually starting to pick up, so a bunch of people are building houses right now that will be more expensive to sell, so maybe those two will magically cancel each other out and housing prices will come down to account for the higher interest rates and increased supply but lol nope the one iron law of economics I have ever found to actually be real is that just because prices go up doesn’t mean they ever come down when the conditions for them going up disappear. Yeah, not happening.
In my world of startups, this means everyone is losing their shit. No more IPOs (except Bauch & Laumb apparently), no more money to be raised by VCs (even though VCs are sitting on an unprececented amount of dry power capital they need to invest), and that M&A is going into the shitter. The thing everyone in the industry loves to say at this point is something along the lines of “oh man founders are so screwed, new founders have never been through anything like this before” and I suppose, given the proclivity of the tech industry to fund children, that is true. But god, I am fifty now, and I think this is the fourth? fifth? time I have heard these things since I’ve been running tech companies. I mean, yes, that is across twenty years or so, but still, that works out to once every five years and also I am definitely forgetting at least one time. 2001, 2008, 2020, 2022. God.
I don’t think they’re wrong, exactly. And I think what’s happening in the public markets to tech stocks is… well, it is uniquely bad. I mean, it’s no 2001, no one believes that tech companies are going to go away, but it does feel substantially worse than anything that’s happened in the last twenty years. That is unpleasant and alarming. I shall probably suck it up and move my index fund from a “growth” focused index fund (i.e. tech) and move it over to something boring like a DOW index fund or something. I don’t want to, Felix tells me I shouldn’t be looking at my portfolio, but.. well, maybe half.
But I do think it’s weird how bad tech companies are at operating in recessions. This is, to put it plainly, when I shine as a tech exec. I’m actually kind of bad at running a tech company in an era of cheap capital and people going crazy with their unicorn and decacorn valuations and patent absurdity, because I can never believe that the whole thing is real, and I can’t act the part. Kinda like I could never do that weird bump and grind dance thing in da club because the whole thing is so stupid and patently fake. But gimme a downturn where you have to manage cash flow and run your business like a business? Sign me up. This is my sweet spot.
There’s also something real weird going on with the full employment thing, not sure how that is working. Companies are starting to lay people off, not many but some, and people are just getting new jobs, because unemployment is still like 3%. That is so different than past recessions and I gotta admit that hiring is a bitch right now. Unlike past recessions where salaries returned to normality, they’re just.. not. And why should they? Inflation is a thing, people need to make what they can. But it’s definitely different, I can’t just run the same old playbook. Constant vigilance.
Also I am sad that it appears we found the limit to Modern Monetary Theory? Maybe? The MMD jury seems to still be out, but the basics of the theory are that you can actually pump a lot more money into the economy and we should stop worrying about the deficit. There is a limit, though. Most anti-MMD pundits gloss this part over, but if you go read The Defecit Myth (and you should!) Stephanie Kelton is very clear that MMD doesn’t last forever, you have to pull back once actual, not made-up, real-world indicators like inflation kick in to indicate that the economy has absorbed as much as it can. Some MMD adherents posit right now that our inflation isn’t real inflation, at least not MMD-caused inflation from the massive amounts of money the government has ben pumping into the economy for, oh, god, like fifteen years. But that seems splitting hairs to me, I suspect technically they may be right but practically it makes no difference. Inflation is here, it sucks, and until it’s gone, no MMD for you.
What’s so depressing about this, to me, is that MMD had some amazing promises. Kelton out there, AOC out there, saying “imagine what we could do with all that money!” And, well, now we don’t need to imagine. We know exactly what our government would do if it could pump it into the economy. It would mostly give it to Wall Street! I mean, that is not fair, the pandemic stimuli bills did a lot of good, PPP was bold, innovative, successful and pretty awesome (fight me), as were several other aspects of those bills. But all in all, when viewing all of it through the prism of MMD’s promise, I can’t help but think “is that all there is?”
Then let’s keep dancing.
Pretty much cobbling together this mix right now. Mix of new stuff and a very specific type of remix and mix from the mid-to-late 90’s that didn’t really take off. I’ve been thinking about those 1993 Sanctuary remix CDs — there were two — by the cult, with remixes by Jim Thirwell and the like. Only some of them are on Spotify, but this one is. Had them on CD but they sold long ago. Kind of want to buy the vinyl. They’re not good, exactly, but representative. Same with that The The remix. Hard to pin down.
Anyway. Happy Tuesday. Miss you guys. Talk soon.