Wry & Dry

Olympic edition. China flu. Nice work, if you can get it.

Olympics I

Wry & Dry spent the week watching ads on television, interrupted by watching some Olympic events. And there were a few weird ones.

Skateboarding? Seriously? Clearly an attempt to excite whatever age cohort comes after Millennials. Readers should wait for the 2024 Olympic teen-pleaser: Graffiti art. 

Wry & Dry hopes that skateboarding will go the way of that early 20th century favourite: the tug of war. [1] Although tugging at least had the feature of being an event decided by either the fastest, strongest or highest.  And not by the whim of a judge.   

cartoon tug of war

[1] Held at five Olympics (1900-1920), with the Brits the clear champions at tugging the forelock, winning 2 gold, 2 silver and a bronze. A tugging team consisted of 6 members in 1900, 5 members in 1904, and 8 members in the last three appearances of the sport. 

China flu I

In the overwhelming excitement of watching Olympic skateboarding, Readers may have missed a mini-stock market meltdown in Emperor Xi's empire. And what it signals.

Emperor Xi's mandarins have been cracking down on companies that have too much power. Y'see, only the Emperor can have too much power.

Readers may not be familiar with some of these companies. But allow Wry & Dry to give you the whisper: they are big. Shares of Tencent fell 10% on Monday after Beijing ordered the company to give up exclusive music licensing rights, food delivery companies such as Meituan were also targeted, while education stocks like TAL Education, New Oriental and Gaotu Techedu slumped about 25% each amid a ban on for-profit educational tutoring. The latter is a big industry in the Empire.

And then there was the pulling of Ant Group's New York IPO and the DiDi Global fiasco that shook the investing world earlier this month. 

cartoon china bear

What's going on? Apologists for the Emperor say that it is all about financial risk, antitrust concerns and national security violations. Nuh.

Readers know that with a market-based system, every individual shapes the economy and society through their transactions, making government sort-of obsolete. Thus threatening its existence. China’s leadership has recognised this. Simplistically, there are two alternatives: either it gives up the idea of free markets, or it gives up on the single party rule.

Emperor Xi has chosen the former; China is now rich enough that it can afford a purer form of communism. But his subjects like the idea less and less. The number of asylum seekers from China since Emperor Xi came to power has leapt higher than former NSW Premier John Fahey on the news of Sydney hosting the 2000 Olympics:

Chart refugees

Asylum Seekers From China

Source: UNHCR, cited in The Economist

Olympics II

Since when did winning a medal become 'medalling'? Does that mean kicking a goal is 'goaling'?

And, what's worse, to 'have medalled'? [2] Sigh.

[2] Not to be confused with meddling, i.e. taking drugs. Or bribes.   

China flu II

Something is rotten in the state of China, to paraphrase the Bard. A prominent Chinese billionaire has been sentenced to 18 years in prison. 

Sun Dawu's crime? He was found guilty of "picking quarrels and provoking trouble."

Wry & Dry guesses that it was lucky he didn't do anything really serious.

Nice work, if you can get it

Collapsed education company Vocation Limited (ironically, the chairman at the point of collapse was former Education Minister John Dawkins [3]) has to fork out $50m after being sued by investors. For now, the reasons don't matter. What does is who gets the $50m.

Lawyers: $12.75m.

Litigation funders: $10.9m.

Investors: $26.35m

The low pay-out to investors was because there were two law firms and two litigation funders fighting for the loot.  It would be folly for Wry & Dry to suggest that the lawyers and the litigation funders thought of their own pockets and not of the investors.  

Cartoon lawyers money

[3] Mr Dawkins earned over $1m when Vocation listed in 2013.  The company fell to earth in 2015.  Dawkins was disqualified by ASIC from being a director for two years. And fined $25,000. That's a Vocational net of $975,000. 

Olympics III

Readers will have noticed a new country competing in the Olympics: the Russia Olympic Committee. Readers would have seen ROC coming fourth in the medal tally.

Hats off to Tsar Vlad for sending a committee of 335 to the Olympics [4]. Such innovation. Wry & Dry can only imagine that the committee has Politburo status.

The only surprise is that Tsar Vlad himself wasn't a competitor. Imagine the photos. 

Cartoon vlad medals

[4] Of course, Russia was suspended from the Olympics for state-sponsored drug cheating. However, the IOC couldn't bring itself to ban the actual athletes. So settled on the compromise of a 'committee' representation. 

Russian ingenuity

Wry & Dry again dips his lid to Russia. Two Russian workers have tapped into the underground electricity system of the city of Kazan to meet their power needs.

Their power need was to supply electricity to:

a.  poor relatives;

b.  an illegal casino;

c.  a backyard covid vaccine manufacturing plant; or

d.  a Bitcoin mining operation.

Close, but no cigar. The correct answer is d. They installed Bitcoin 'mining equipment' at a transformer substation. Creation of Bitcoin requires massive computer power which in turn requires massive amounts of electricity. Bitcoin mining makes up about 0.55% of the world's electricity consumption. [5]

[5] Source: Cambridge Center for Alternative Finance, quoted in Harvard Business Review May 2021.

Yes, Minister

Readers will know that Apple Pay is massive in online payments in Australia, having over 80% of the Near Field Communication (NFC) payments' market (i.e. tapping with an iPhone to make a retail payment).

But in a script that is a blend of Keystone Cops and Yes Minister, no government authority owns up to controlling these payments.

The RBA, the primary payments system regulator, told a parliamentary committee that Apple and Google fall outside the legal definition of a payments system. 

The ACCC, the competition regulator, told the same committee that Apple’s limitations on NFC chips created competition concerns – but the terms of reference for its digital platform's inquiry excluded investigation of payments. 

APRA, the prudential regulator, and ASIC, the companies' regulator, have no control because Apple Pay does not hold any customer funds (it merely facilitates transactions with bank cards on existing infrastructure), it does not fall under the regime for “stored value facilities”.

APRA and ASIC also told the committee they were waiting for the Treasury payments system review to be released to provide guidance on the direction they should be taking.

Treasury Assistant Secretary David Pearl said Treasury was aware of concerns about access to NFC payments, but had not looked into the issue in any detail.

Cartoon regulators

Wry & Dry posits that perhaps PM Jimmy Morrison, in his quest to administer the world's worst covid vaccine rollout, should have given the rollout not to the Health Department but to a consortium of RBA, ACCC, ASIC, APRA and Treasury. This would have meant certain global gold medal for Australia in vaccine stuff-ups.

Unclear on the concept

A pub in Dublin, The Virgin Mary, recently opened.

It doesn't serve any alcohol. 

Weirdly, the non-alcoholic pub is a success. The owners say that if an alcohol-free pub can work in Dublin, it can work anywhere. A franchise in Abu Dhabi will soon open.

Lies. Damned lies. 

Are white American evangelical Christians really that gullible? The august Economist (a weekly sort-of fiscal/ business magazine) and YouGov (a polling company) surveyed lots of Americans. Below is the outcome.

Chart conspiracies

Source: The Economist/YouGov

Whilst the self-identification of being 'white' in a survey is pretty clear-cut, the same may not be said for 'evangelical'. Many 'low-church' Christians would be happy to just identify themselves as being Christian, and nothing more. [1] 

Perhaps the survey would be more useful asking about those who identify just as 'Christian'. Or as Muslim. Or reporting the result of those who identify as being the various shades of 'non-white', as it were.

And, of course, there is the issue of the American education regime, where the cost of public education is paid for by local property taxes. Hence the poorer the locale, the less money to be spent on education. This system partially explains the intergenerational educational poverty in the Yoo-Ess-Ay. And possibly why conspiracy theories are more acceptable.

If 20% of Americans thinks that the government wants to microchip the population, it just might be that the starting point of education is, well, low.

[1]  Disclosure: Wry & Dry identifies as being white and a 'low-church' Christian.

Labor turns Liberal 

In a week of Olympic surprises, Labor Leader Anthony Albanese has diched Labor's election-losing plans to scrap franking credits and reform 'negative gearing' and to overturn legislated tax cuts. The focus will now be on 'national reconstruction', industry support, childcare, social housing, etc.

Wry & Dry thinks that AA has got it wrong. Labor lost the last election because voters just didn't like Wooden Shorten. However, there is no doubt the proposal to scrap franking credits was plain idiocy and showed that Wooden just didn't understand how the tax systems works.

So, Labor has now cut itself off from massive sources of revenue to spread to true believers if it wins the next election. It will now have to settle on borrowing from Readers' children and grandchildren. Just like Josh has done.    

Snippets from all over 

1. Congress to spend $1 billion to keep itself safe

A bill passed by Congress is to spend about $1 billion on security measures for the Capitol (i.e. the US parliament), following the storming of it in January by pro-Trump supporters.

Wry & Dry comments: Perhaps a moat, drawbridge and portcullis would be cheaper.

2. Australia's inflation spikes

Australia's CPI spiked to 3.8% in the year to June.

Wry & Dry comments: This is a 'blip', a deeply technical term that means economists don't know. Actually, they do: it's because of the unwinding of temporary free childcare and covid-driven lower petrol prices. Nothing about which to be worried.  Yet.

3. Big Tech boom

Quarterly record profits aplenty: Apple had net profit of $21.7 billion; Google $18.5 billion and Microsoft $16.5 billion.  

Wry & Dry comments: At what point do such large numbers become meaningless?

4. Tesla powers up

Tesla has reported a record quarterly headline profit of $1.1 billion as the electric car maker easily beat expectations on Wall Street.

Wry & Dry comments: Tesla’s main factory is in Fremont, California, and it also has a gigafactory in Shanghai, China. It will begin production in Berlin and Texas this year.

5. Energy non-investment

Capital expenditures by U.S. energy companies hit the lowest level since 2004

Wry & Dry comments: The main cause is the accelerated decline of shale oil and gas investment. In an article on the Peak Oil website, Maglan Capital suggests the political pressures on the energy companies will result in a “serious” global oil crisis within the next 3 – 5 years.

And, to soothe your troubled mind...

Last words...

“Back-to-back.”

    - Any number of Olympic Games' commentators who cannot pronounce 'consecutive'.

And the list of other solecisms is long.

 

PS A reminder that the opinions in Wry & Dry do not necessarily represent those of First Samuel, its employees or directors.

 

Cheers

Anthony