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This week we talk about Trump’s tariffs, the Supreme Court, and negotiating leverage.We also discuss trade wars, Greenland, and the IEEPA.Recommended Book: Smoke and Ashes by Amitav GhoshTranscriptI’ve spoken on this show before about tariffs and about US President Trump’s enthusiasm for tariffs as an underpinning of his trade policy. Last October, back in 2025 I did an episode on tariff leverage and why the concept of an ongoing trade war is so appealing to Trump—it basically gives him a large whammy on anyone he enters negotiations with, because the US market is massive and everyone wants access to it, and tariffs allow him to bring the hammer down on anyone he doesn’t like, or who doesn’t kowtow in what he deems to be an appropriate manner.So he can slap a large tariff on steel or pharmaceuticals or cars from whichever country he likes just before he enters negotiations with that country, and then those negotiations open with him in an advantageous spot: they have to give him things just to get those tariffs to go away—they have to negotiate just to get things back to square one.That’s how it’s supposed to work, anyway. What we talked about a bit back in October is TACO theory, TACO standing for Trump Always Chickens Out—the idea is that other world leaders had gotten wise to Trump’s strategy, which hasn’t changed since his first administration, and he has mostly been a doubling-down on that one, primary approach, to the point that they can step into these negotiations, come up with something to give him that allows him to claim that he’s won, to make it look like he negotiated well, and then they get things back down to a more reasonable level; maybe not square one, but not anything world-ending, and not anything they weren’t prepared and happy to give up.In some cases, though, instead of kowtowing in this way so that Trump can claim a victory, whether or not a victory was actually tallied, some countries and industries and the businesses that make up those industries have simply packed up their ball and gone home.China has long served as a counterbalance to the US in terms of being a desirable market and a hugely influential player across basically every aspect of geopolitics and the global economy, and this oppositional, antagonistic approach to trade has made the US less appealing as a trade partner, and China more appealing in comparison.So some of these entities have negotiated to a level where they could still ship their stuff to the US and US citizens would still be willing to pay what amounts to an extra tax on all these goods, because that’s how tariffs work, that fee is paid by the consumers, not by the businesses or the origin countries, but others have given up and redirected their goods to other places. And while that’s a big lift sometimes, the persistence of this aggression and antagonism has made it a worthwhile investment for many of these entities, because the US has become so unpredictable and unreliable that it’s just not worth the headache anymore.What I’d like to talk about today is a recent Supreme Court decision related to Trump’s tariffs, and what looks likely to happen next, in the wake of that ruling.—Ever since Trump stepped back into office for his second term, in January of 2025, he has aggressively instilled new and ever-growing tariffs on basically everyone, but on some of the US’s most important trade partners, like Mexico and Canada, in particular.These tariffs have varied and compounded, and they’ve applied to strategic goods that many US presidents have tried to hobble in various ways, favoring US-made versions of steel and microchips, for instance, so that local makers of these things have an advantage over their foreign-made alternatives, or have a more balanced shot against alternatives made in parts of the world where labor is cheaper and standards are different.But this new wave of tariffs were broad based, hitting everyone to some degree, and that pain was often taken away, at least a little, after leaders kowtowed, at times even giving him literal gold-plated gifts in order to curry favor, and/or funneling money into his family’s private companies and other interests, allowing him to use these tariffs as leverage for personal gain, not just national advantage, in other cases giving him what at least looked outwardly to be a negotiating win.Things spiraled pretty quickly by mid-2025, when China pushed back against these tariffs, adding their own reciprocal tariffs on US goods, and at one point extra duties on Chinese imports coming into the US hit 145%.Shortly thereafter, though, and here we see that TACO acronym proving true, once again, Trump agreed to slash these tariffs for 90 days, and around the same time, in May of 2025, a federal appeals court temporarily reinstated some of Trump’s largest-scale tariffs after a lower court ruled that they couldn’t persist.The remainder of 2025 was a story of Trump trying to strike individual deals with a bunch of trade partners, like South Korea, Indonesia, and India, in some cases via direct negotiation, in others with a bunch of threats that eventually led to a sort of mutual standoff that no one was particularly happy about.2026 was greeted with a threat by Trump to impose a huge wave of new tariffs on eight major European allies, those tariffs sticking around until these nations agreed to allow the US to buy Greenland, which was an obsession of Trump’s at that point, but a lot of Trump’s tariff posturing was derailed by a Supreme Court decision that landed in mid-February, in which the justices decided, 6 to 3, that Trump’s reciprocal tariffs are unconstitutional, as setting and changing tariffs is a Congressional power, not a Presidential one.This was a serious blow to Trump and his stated policies, as pretty much all of his economic plans oriented around the idea—which most economists have said is bunk and based on fantasy, not reality, but still—that putting a bunch of tariffs on everything will allow the US to earn so much additional revenue that the deficit can be paid down.It’s worth noting here that, just as those economists predicted, the deficit has only gotten larger under both Trump administrations, and in fact the growth of the US debt has sped up, not declined, despite the additional billions being pulled into government coffers by these tariffs, because the Trump administration’s spending is massive, and because the losses related to tariffs are also significant. But tariffs remain center to his policy nonetheless, so this was a major blow.This ruling also seemed likely to defang a lot of Trump’s threats and drain his leverage at the negotiating table, as he could no longer threaten everyone with more tariffs, practically booting them from or weakening them on the US market.So Trump was pissed, and as he tends to do, he publicly raged about the decision, which was made by a Supreme Court that is heavily stacked in his favor; which gives an indication of just how unpopular and unconstitutional all of this has been.But immediately after that decision landed, he announced that, using alternative authorities—different powers—he would be imposing a blanket 10% tariff on everything coming into the US, and the following day announced that it would be a 15% tariff on everything, instead.This does seem to be something Trump has the power to do, but he can only do it under the auspices of the International Emergency Economic Powers Act, or IEEPA, and these tariffs will only last for 150 days, max, and might also be challenged in court.Also notably, some entities, like Britain and Australia, will face higher rates than they faced under the previous tariff setup, because of how they are applied and compound with other trade barriers, or the nature of what they export to the US market, while others, including China, will see their tariffs substantially drop.Which could make things tricky, as that implies some of the previously negotiated deals have changed post-deal, or in some cases mid-negotiation; which means a lot more work to get things where everyone wants them, but also a loss of legitimacy and credibility for this administration, as they seem to be negotiating using powers they don’t actually have and making promises they can’t keep.All of which, rather than simplifying and clarifying things for the US market and our international trade partners, actually further complicates them, at least for now, until the dust settles.It does seem likely Trump’s administration will continue to try to leverage whatever power they can in this matter, grabbing at levers that haven’t been previously used, or used in this way, and those attempts will almost certainly be legally challenged, which could lead to more court cases, and a lot more uncertainty in the meantime, until those cases are figured it.It’s also created new rifts within the Republican party, as Trump seems to be going after those who voted against his tariffs, or in any other way supported their removal, and he’s raged against the Supreme Court justices, even those he put into place and who are ideologically aligned with the Republican party almost always, which could also lead to more fracturing within his base, leading up to the November 2026 Congressional elections.One more thing that’s worth noting here is that Trump’s usual tactic of trying to distract from things he doesn’t want people to pay attention to is in full operation following this court case: as all this has been happening, and against the backdrop of increasingly serious allegations related to his abundant presence in the Epstein files, he’s been talking more about potentially attacking Iran and releasing files on aliens, on extraterrestrials on Earth and in the US.So we’re likely to see a lot more of that sort of thing in the coming months, especially if things continue to not go his way in regards to these tariffs and the hubbub surrounding them, but this story will shape global and US economi

This week we talk about mass surveillance, smart doorbells, and the Patriot Stack.We also discuss Amazon, Alexa, and the Super Bowl.Recommended Book: Red Moon by Benjamin PercyTranscriptIn 2002, in the wake of the September 11, 2001 terrorist attacks on the World Trade Center, the US government created a new agency—the United States Immigration and Customs Enforcement, or ICE, operating under the auspices of the US Department of Homeland Security, which was also formed that year for the same general reason, to defend against 9/11-style attacks in the future.As with a whole lot of what was done in the years following the 9/11 attacks, a lot of what this agency, and its larger department did could be construed as a sort of overcompensation by a government and a people who were reeling from the first real, large-scale attack within their borders from a foreign entity in a very long time. It was a horrific event, everyone felt very vulnerable and scared, and consequently the US government could do a lot of things that typically would not have had the public’s support, like rewiring how airports and flying works in the country, creating all sorts of new hurdles and imposing layers of what’s often called security theater, to make people feel safe.While the TSA was meant to handle things on the front-lines of air transportation, though, X-raying and patting-down and creating a significant new friction for everyone wanting to get on a plane, ICE was meant to address another purported issue: that of people coming into the US from elsewhere, illegally, and then sticking around long enough to cause trouble. More specifically, ICE was meant to help improve public safety by strictly enforcing at times lax immigration laws, by tracking down and expelling illegal immigrants from the country; the theory being that some would-be terrorists may have snuck into the US and might be getting ready to kill US citizens from within our own borders.There’s not a lot of evidence to support that assertion—the vast majority of terrorism that happens in the US is conducted by citizens, mostly those adhering to a far-right or other extremist ideologies. But that hasn’t moved the needle on public perception of the issue, which still predominantly leans toward stricter border controls and more assiduous moderation of non-citizens within US borders—for all sorts of reasons, not just security ones.What I’d like to talk about today is an offshoot of the war on terror and this vigilance about immigrants in the US, and how during the second Trump administration, tech companies have been entangling themselves with immigration-enforcement agencies like ICE to create sophisticated surveillance networks.—In mid-July of 2025, the US Department of Defense signed one of its largest contracts in its history with a tech company called Palantir Technologies. Palantir was founded and is run by billionaire Peter Thiel, who among other things is generally considered to be the reason JD Vance was chosen to be Trump’s second-term Vice President. He’s also generally considered to be one of, if not the main figure behind the so-called Patriot Tech movement, which consists of companies like SpaceX, Anduril, and OpenAI, all of which are connected by a web of funding arms and people who have cross-pollinated between major US tech companies and US agencies, in many cases stepping into government positions that put them in charge of the regulatory bodies that set the rules for the industries in which they worked.As a consequence of this setup and this cross-pollination, the US government now has a bunch of contracts with these entities, which has been good for the companies’ bottom lines and led to reduced government regulations, and in exchange the companies are increasingly cozy with the government and its many agencies, toeing the line more than they would have previously, and offering a lot more cooperation and collaboration with the government, as well.This is especially true when it comes to data collection and surveillance, and a great deal of that sort of information and media is funneled into entities like Palantir, which aggregate and crunch it for meaning, and then send predictions and assumptions, and make services like facial-recognition technologies predicated on their vast database, available to police and ICE agents, among others such entities.There has been increasingly stiff pushback against this melding of the tech world with the government—which has always been there to some degree, but which has become even more entwined than usual, of late—and that pushback is international, even long-time allies like Canada and the EU making moves to develop their own replacements for Amazon and Google and OpenAI due to these issues, and the heightened unpredictability and chaos of the US in recent years, but it’s also evident within the US, due in part to Trump’s moves while in office, but also the on-the-ground realities in places like Minneapolis, where ICE agents have been brutalizing and blackbagging people, sometimes illegal immigrants, sometimes US citizens, usually non-white US citizens, and the ICE agents are being rewarded, getting bonuses, for beating up and kidnapping and in some cases murdering people, whether or not any of these people are actually criminals—and it’s illegal to do that kind of thing even if they are criminals, by the way.All of which sets the scene for what happened following the Super Bowl, this year.Ring is a home security and smart home device company that is best known for its line of smart doorbells, but which also makes all sorts of security cameras and other alarm system devices.Even though smart doorbells, complete with cameras and other sorts of functionality, existed before Ring, this company basically created the smart doorbell industry as it exists today back in 2014, when it received a round of equity investment and changed its named from Doorbot to Ring. It was bought by Amazon four years later, in 2018, for a billion dollars.One of Ring’s premier features is related to its camera: you can use your phone or other smart home device to see who’s at your door when they ring the bell, but it can also be set to record when it detects movement, which makes it easy to check and see who stole your Amazon package from your porch when you weren’t at home, for instance, and resultingly Ring door camera footage has become fundamental to reporting, and on occasion pursuing, some types of crime.As a direct result of that utility, Ring introduced its Neighbors service in mid-2018, this service serving as a sort of social network that allows Ring device users to discuss local issues, especially those related to safety and security, anonymously, while also allowing them to share photos and videos taken by their devices. This service also created relationships with local law enforcement, and allowed police to jump onto the network and request footage from Ring customers, if they thought these doorbell cams might have photos or video of someone escaping with a stolen car, for instance, which might then help the police catch that crook.It’s generally assumed that Amazon probably bought Ring, at least in part, to entrench itself as the lord of the internet of things world, as it launched its Amazon Sidewalk platform in 2020, which allowed all Amazon devices, including Ring devices, to share a wireless mesh network, all of them communicating with each other and all using Amazon’s Alexa as an interface.In 2023, Ring was sued by the FTC for $5.8 million because it allowed its employees and contractors to access private videos by failing to have basic security and privacy features in place—so not only could any Ring employee view their customer’s private video feeds, hackers could easily access all this media and data, as well. Just one example surfaced in that lawsuit shows that a Ring employee viewed thousands of video recordings of at least 81 different female users over the course of a few months in 2017.So Amazon was building a surveillance network that worked really well, in the sense that it was predicated on popular, at times quite useful devices that people seemed to love, but which was also quite leaky, giving all sorts of people access to these supposedly private feeds, and it was shared with law enforcement via that social network. It’s also been alleged that Ring (and Amazon) have used users’ footage without further permission for things like facial recognition and AI training. Their partnership with police agencies also allegedly created incentives for the police to encourage citizens to buy Ring cams and other security devices for their homes, creating perverse incentives. And again, these devices connect wirelessly to other internet of things devices, expanding their reach and the potential for abuse of collected user data.In late 2025, Ring announced a new partnership with Flock Safety, a company that’s best known for its security offerings, including automated license plate readers and gunshot detector systems.These are mass surveillance tools used by some governments and law enforcement entities, and they use cameras and microphones to capture license plates, people’s faces, and sounds that might be gunfire and aggregate that data to be used by police, neighborhood associations, and in some cases private property owners.This sort of technology is incredibly useful to companies like Palantir, which again, aggregates and crunches it, on scale, and then shares that information with police, ICE, and other such agencies.These tools can sometimes help flag areas where guns are being fired or where crimes are being committed, but they’re also imperfect and at times biased against some groups of people and areas, and some data show that not only is crime not reduced by the presence of these systems, but there’s a fair bit of evidence that this data often falls into the hands of hackers or is used by employees for nefarious, stalker

This week we talk about OpenAI, nudify apps, and CSAM.We also discuss Elon Musk, SpaceX, and humanistic technology.Recommended Book: Who’s Afraid of Gender? by Judith ButlerTranscriptxAI is an American corporation that was founded in mid-2023 by Elon Musk, ostensibly in response to several things happening in the world and in the technology industry in particular.According to Musk, a “politically correct” artificial intelligence, especially a truly powerful, even generally intelligent one, which would be human or super-human-scale capable, would be dangerous, leading to systems like HAL 9000 from 2001: A Space Odyssey. He intended, in contrast, to create what he called a “maximally truth-seeking” AI that would be better at everything, including math and reasoning, than existing, competing models from the likes of OpenAI, Google, and Anthropic.The development of xAI was also seemingly a response to the direction of OpenAI in particular, as OpenAI was originally founded in 2015 as a non-profit by many of the people who now run OpenAI and competing models by competing companies, and current OpenAI CEO Sam Altman and Elon Musk were the co-chairs of the non-profit.Back then, Musk and Altman both said that their AI priorities revolved around the many safety issues associated with artificial general intelligence, including potentially existential ones. They wanted the development of AI to take a humanistic trajectory, and were keen to ensure that these systems aren’t hoarded by just a few elites and don’t make the continued development and existence of human civilization impossible.Many of those highfalutin ambitions seemed to either be backburnered or removed from OpenAI’s guiding tenets wholesale when the company experienced surprising success from its first publicly deployed ChatGPT model back in late-2022.That was the moment that most people first experienced large-language model-based AI tools, and it completely upended the tech industry in relatively short order. OpenAI had already started the process of shifting from a vanilla non-profit into a capped for-profit company in 2019, which limited profits to 100-times any investments it received, partly in order to attract more talent that would otherwise be unlikely to leave their comparably cushy jobs at the likes of Google and Facebook for the compensation a non-profit would be able to offer.OpenAI began partnering with Microsoft that same year, 2019, and that seemed to set them up for the staggering growth they experienced post-ChatGPT release.Part of Musk’s stated rationale for investing so heavily in xAI is that he provided tens of millions of dollars in seed funding to the still non-profit OpenAI between 2015 and 2018. He filed a lawsuits against the company after its transition, and when it started to become successful, post-ChatGPT, especially between 2024 and 2026, and has demanded more than $100 billion in compensation for that early investment. He also attempted to take over OpenAI in early 2025, launching a hostile bid with other investors to nab OpenAI for just under $100 billion. xAI, in other words, is meant to counter OpenAI and what it’s become.All of which could be seen as a genuine desire to keep OpenAI functioning as a non-profit arbiter of AGI development, serving as a lab and thinktank that would develop the guardrails necessary to keep these increasingly powerful and ubiquitous tools under control and working for the benefit of humanity, rather than against it.What’s happened since, within Musk’s own companies, would seem to call that assertion into question, though. And that’s what I’d like to talk about today: xAI, its chatbot Grok, and a tidal wave of abusive content it has created that’s led to lawsuits and bans from government entities around the world.—In November of 2023, an LLM-based chatbot called Grok, which is comparable in many ways to OpenAI’s LLM-based chabot, ChatGPT, was launched by Musk’s company xAI.Similar to ChatGPT, Grok is accessible by apps on Apple and Android devices, and can also be accessed on the web. Part of what makes its distinct, though, is that it’s also built into X, the social network formerly called Twitter which Musk purchased in late-2022. On X, Grok operates similar to a normal account, but one that other users can interact with, asking Grok about the legitimacy of things posted on the service, asking it normal chat-botty questions, and asking it to produce AI-generated media.Grok’s specific stances and biases have varied quite a lot since it was released, and in many cases it has defaulted to the data- and fact-based leanings of other chatbots: it will generally tell you what the Mayo clinic and other authorities say about vaccines and diseases, for instance, and will generally reference well-regarded news entities like the Associated Press when asked about international military conflicts.Musk’s increasingly strong political stances, which have trended more and more far right over the past decade, have come to influence many of Grok’s responses, however, at times causing it to go full Nazi, calling itself Mechahitler and saying all the horrible and offensive things you would expect a proud Nazi to say. At other times it has clearly been programmed to celebrate Elon Musk whenever possible, and in still others it has become immensely conspiratorial or anti-liberal or anti-other group of people.The conflicting personality types of this bot seems to be the result of Musk wanting to have a maximally truth-seeking AI, but then not liking the data- and fact-based truths that were provided, as they often conflicted with his own opinions and biases. He would then tell the programmers to force Grok to not care about antisemitism or skin color or whatever else, and it would overcorrect in the opposite direction, leading to several news cycles worth of scandal.This changes week by week and sometimes day by day, but Grok often calls out Musk as being authoritarian, a conspiracy theorist, and even a pedophile, and that has placed the Grok chatbot in an usual space amongst other, similar chatbots—sometimes serving as a useful check on misinformation and disinformation on the X social network, but sometimes becoming the most prominent producer of the same.Musk has also pushed for xAI to produce countervailing sources of truth from which Grok can find seeming data, the most prominent of which is Grokipedia, which Musk intended to be a less-woke version of Wikipedia, and which, perhaps expectedly, means that it’s a far-right rip off of Wikipedia that copies most articles verbatim, but then changes anything Musk doesn’t like, including anything that might support liberal political arguments, or anything that supports vaccines or trans people. In contrast, pseudoscience and scientific racism get a lot of positive coverage, as does the white genocide conspiracy theory, all of which are backed by either highly biased or completely made up sources—in both cases sources that Wikipedia editors would not accept.Given all that, what’s happened over the past few months maybe isn’t that surprising.In late 2025 and early 2026, it was announced that Grok had some new image-related features, including the ability for users to request that it modify images. Among other issues, this new tool allowed users to instruct Grok to place people, which for this audience especially meant women and children, in bikinis and in sexually explicit positions and scenarios.Grok isn’t the first LLM-based app to provide this sort of functionality: so called “nudify” apps have existed for ages, even before AI tools made that functionality simpler and cheaper to apply, and there have been a wave of new entrants in this field since the dawn of the ChatGPT era a few years ago.Grok is easily the biggest and most public example of this type of app, however, and despite the torrent of criticism and concern that rolled in following this feature’s deployment, Musk immediately came out in favor of said features, saying that his chatbot is edgier and better than others because it doesn’t have all the woke, pearl-clutching safeguards of other chatbots.After several governments weighed in on the matter, however, Grok started responding to requests to do these sorts of image edits with a message saying: “Image generation and editing are currently limited to paying subscribers. You can subscribe to unlock these features.”Which means users could still access these tools, but they would have to pay $8 per month and become a premium user in order to do so. That said, the AP was able to confirm that as of mid-January, free X users could still accomplish the same by using an Edit Image button that appears on all images posted to the site, instead of asking Grok directly.When asked about this issue by the press, xAI has auto-responded with the message “Legacy Media Lies.” The company has previously said it will remove illegal content and permanently suspend users who post and ask for such content, but these efforts have apparently not been fast or complete, and more governments have said they plan to take action on the matter, themselves, since this tool became widespread.Again, this sort of nonconsensual image manipulation has been a problem for a long, long time, made easier by the availability of digital tools like Photoshop, but not uncommon even before the personal computer and digital graphics revolution. These tools have made the production of such images a lot simpler and faster, though, and that’s put said tools in more hands, including those of teenagers, who have in worryingly large numbers taken to creating photorealistic naked and sexually explicit images of their mostly female classmates.Allowing all X users, or even just the subset that pays for the service to do the same at the click of a button or by asking a Chatbot to do it for them has increased the number manyfold, and allowed even more people to created explicit images of neighbors, celebrities, and

This week we talk about the European Union, India, and tariffs.We also discuss trade barriers, free trade, and dumping.Recommended Book: The Kill Chain by Christian BroseTranscriptA free trade agreement, sometimes called a free trade treaty, is a law that reduces the cost and regulatory burden of trading between two or more states.There are many theories as to the ideal way to do international trade, with some economists and politicians positing that complete free and open trade is the way to go, because it allows goods and services to cross borders completely unencumbered, which in turn allows businesses in different countries to really lean into whatever they’re good at, selling their cars to countries that are less good at making cars, while that recipient country produces soy beans or computer chips or whatever they’re good at making, and sending those in the other direction, likewise unburdened by stiff tariffs or regulatory hurdles. Each country can thus produce the best product cheapest and sell it to the market where their products are in high-demand, while they, in turn, benefit from the same when it comes to other products and services.This theory leans on the idea that everyone is better off when everyone does what they’re best at, rather than trying to do everything—specialization. But those who oppose this conception of international trade argue that this creates and reinforces asymmetries between different nations and businesses: a country that’s really good at producing soybeans may be at a substantial disadvantage if the country that makes cars ever decides to go to war, because they won’t have the existing infrastructure to build tanks or drones or whatever else, while the country that specializes in computer chips might hold all the cards when it comes to generating economic pressure against its enemies or would-be enemies, because such chips are in everything these days, from military hardware to kitchen appliances.This also creates potential frailties for countries that specialize in, say, buggy whips, only to have a new technology like the automobile come around and put a significant chunk of their total economy out of business.This theory may also leave local businesses that don’t lean into a regional strength kind of in the lurch. If a country with a decent-sized automobile industry decides leaves their borders completely open to international competition, there’s a chance that could light a fire under those local producers, forcing them to become more competitive, but there’s also a chance it could collapse the market for local offerings—their cars might no longer be desirable, because the international stuff flooding across the borders from a nation that has heavily prioritized making cars are just so much better and cheaper, whether naturally or artificially, because of subsidies by that foreign government meant to help them take out international competition.This is why most nations have all sorts of tariffs, regulations, and other trade barriers erected between them and their trading partners, and why those trade barriers are ultra-specific, different for every single possible trade partner. The goal is to make international options less appealing by making them more expensive, or making it trickier for foreign competition to smoothly and quickly get their products on your shelves, while still making those things available in a volume that aligns with local consumer demands. And then ideally making it easier and cheaper for your stuff to get on their shelves.The negotiation of all this is massively complicated because Country A might want to favor their soybean farmers, who are an important voting bloc, and Country B might want to do the same for their car industry, because tax income from that industry is vital, and these two governments will thus do what they can to ensure their favored local industries and businesses have the biggest leg-up possible in as many foreign markets as possible, without giving away so much to their trade partners that they create worse situations for other industries and businesses (and the people who run them) on the home-front, as a consequence.What I’d like to talk about today is a recent, massive and potentially quite vital trade deal that was struck in early 2026, and what it might mean for global trade.—At the tail-end of January 2026, the European Commission announced that they had struck what they called “the mother of all deals” with India, this deal the culmination of two decades worth of negotiation, its tenets impacting about 2 billion people and around a quarter of the world’s total GDP.The agreement, as is the case with most such agreements, is fairly complex. But in essence it reduces or eliminates tariffs on 96.6% of all EU goods exported to India, which means about 4 billion euros of annual duties that would have otherwise been paid on European products in India will disappear—a savings for Indian consumers, and a boon for European producers whose products will now be cheaper in India.This is expected to be especially beneficial for European automakers like Volkswagen, Renault, and BMW, which have long been weighed down by a 110% tariff in India; that tariff will be reduced to as little as 10% on the first 250,000 vehicles sold, following this agreement. Lower priced vehicles will still face higher tariffs, to help protect India’s local carmakers, but electric vehicles will benefit from a five-year grace period, as India has been focusing on allowing as many cheap, renewable energy assets and infrastructure into the country as possible, regardless of where they come from.Tariffs on machinery, chemicals, and pharmaceuticals coming from the EU will be almost entirely eliminated, down from tariff rates of 44, 22, and 11%, respectively. Wine, which has long been tariffed at a rate of 150%, will be cut to between 20-30% for many varieties, and spirits from the EU coming into India will see 150% tariffs cut to 40%.On the other side of this deal, the EU will also open its market to Indian goods, reducing tariffs on about 99.5% of all such goods, including seafood, textiles, gems and jewelry, leather goods, plastic products, and toys. Several of these categories, like Indian seafood, textile-making, and other labor-intensive industries, have had a rough time of late, because of high US tariffs enforced by President Trump’s second administration, so this is being seen as a significant win for them in particular.Interestingly, while the reduction in trade barriers is substantial here, and the number of people and industries, and amount of money that’s involved is massive, this deal doesn’t include, and in some cases explicitly excludes, any agreements related to labor rights, climate commitment, or environmental standards.This means that while the European Union has thus far been pretty strict in terms of ensuring incoming products align with their policies and values regarding things like carbon emissions and ensuring goods aren’t produced by people laboring in slave-like conditions, this deal falls short of such enforcements, allowing India to operate with relative impunity, with regards to those issues, at least, and still sell with dramatically reduced barriers, on the European market. That’s a big deal, and is perhaps the biggest indicator of just how badly the EU wanted to make this deal work.The EU was also able to keep significant protections in place for important local sectors like beef and chicken, dairy, rice, and sugar—all industries in which India would have liked to compete in the EU, but which, because of those maintained barriers, they practically can’t. That would likely have been a feverishly negotiated topic, and it’s likely an indicator of how much India wanted this to work, too.On that note, both India and the EU were apparently especially interested in making this multi-decade deal work, now, because of increasing pressure from China on one side and the US on the other.China has been rerouting many of its cheap products that would have previously gone to the US market, elsewhere, engaging in what’s often called ‘dumping’ which slowly but surely puts businesses that produce comparable products at a profit in those local target markets out of business, at which point these Chinese companies can then ratchet up their prices and profits, operating without real competition.The EU and India have both been targeted by Chinese companies taking this approach, because they’re still producing at a feverish pace and because of US tariffs and the general unpredictability and irregularity of US policy overall under the second Trump administration, they’ve been firing that cheap product cannon more intensely at other large markets, instead—and India and the EU are the next two big markets in line right now, after the US and China.On the US side of things, those same tariffs have been hurting companies in both the EU and India that would otherwise been shipping their goods to the rich and spendy US market, and in many cases these tariffs have been fine-tuned to hurt important local industries as much as possible, because that’s one of Trump’s main negotiating tactics: lead with pain and then negotiate to take some of the pain away.This deal, then, serves multiple purposes in that it creates a valuable, newly polished trade relationship between a rich and powerful existing bloc and the newly most-populous country on the planet, which is also rapidly expanding economically and geopolitically.One last point to note, here, though, is that the European Union has been trying to create these sorts of mutually beneficial deals with non-US partners for a while, now, and the two most recent wins, trade deals with a South American trade bloc and with Indonesia, in early January 2026 and in September of 2025, respectively, have borne mixed results.The deal with Indonesia seems to be moving forward apace, and while it’s a heck of a lot smaller than th

This week we talk about social networks, propaganda, and Oracle.We also discuss foreign adversaries, ByteDance, and X.Recommended Book: Rewiring Democracy by Bruce Schneier and Nathan E. SandersTranscriptIn 2021, TikTok, a short-form video platform that’s ostensibly also a social network, though which leans heavily toward consuming content over socializing, was ranked the most popular website by internet services company Cloudflare, beating out all the other big tech players, including search engine juggernaut, Google.It was a neck and neck sort of thing, with Google taking the lead some days that year, but 2021 was definitely TikTok’s time to shine, as it was already popular with young people and was starting to become popular with the general public, of all ages and across a huge swathe of the planet. It even beat Facebook as the most popular social media website that year, despite, again, being mostly about consuming content rather than interacting—that was actually a prime motivator for Meta, which owns Facebook and Instagram, to redirect its own apps in a similar direction, shifting its focus from communication and interaction between users toward the creation of binge-able content, and feeding users more of that content in a feed optimized for time-losing levels of consumption.2021 was also the first full year that TikTok was coming under scrutiny from the US government. In the preceding year, 2020, then first-term president Donald Trump said he was considering banning the app because it was becoming so popular, with young people in particular, and because it was owned by a Chinese company, ByteDance it represented a potential national security threat.So the idea was that because Chinese companies are forced, by their very nature, to do what the Chinese government tells them—that’s just how things work over there—and to do so on the down-low if that’s what the governments demands, and to lie about having to do what the government tells them to do, if the government tells them to thus lie, it doesn’t matter that ByteDance’s leadership swore up and down to the world that the company will never use its popularity, and the data it soaks up from all its users as a result of that popularity, to help the Chinese government, the Chinese military, or Chinese intelligence services.It of course will have to do that, and if it doesn’t, its leaders could be black-bagged and disappeared in the night—because again, that’s just how things work over there. So the Trump administration decided to make TikTok a sort of bogeyman, representing Chinese companies in general, and to some degree the presence of China in the US and throughout the Western world, and said, nope, we’re not gonna let this thing continue to operate over here.It’s worth remembering, too, that by 2021 the world was enmeshed in the COVID-19 pandemic, which originated in China, and which Trump and his administration were ardently attempting to tie to the Chinese government—calling Covid the Chinese Flu, and even worse things, as part of that effort.So this move against TikTok and its parent company, while based on genuine concerns about the ownership of the company and how and where the data being collected by said company is handled, it should also be seen as a political maneuver, allowing Trump, during the 2020 election run-up, to look like he was taking a big stand against a big foreign threat, China.What I’d like to talk about today is a deal that was proposed way back then by the Trump administration, as a potential way out for TikTok and ByteDance, allowing it to continue operating in the US despite threats to shut it down, now that said deal, or a version of it, seems to have finally come to fruition—and what we know about the shape of the resulting new, US-based version of TikTok.—On January 18, 2025, TikTok stopped worked in the US. It voluntarily suspended all services in the country in the lead-up to the implementation of the Protecting Americans from Foreign Adversary Controlled Applications Act, which was passed by the US congress and signed into law by then-president Joe Biden in April of 2024. This law gave social networking services controlled by ‘foreign adversaries’ 270 days, with the possibility of a 90-day extension, to divest themselves so that they’re no longer considered foreign adversary-owned.This law was almost exclusively aimed at TikTok, and the idea was that TikTok, in the US, would no longer be able to legally function following that deadline if it was still owned by China, which for the purposes of this law has been labeled a foreign adversary.ByteDance could keep TikTok in the US going if it sold a majority, controlling stake of its US-based assets to non-adversary owners, but otherwise it would have to shut down.Interestingly, though Trump was the original source of concerns about TikTok and its Chinese ownership during his first administration, when he stepped back into office in January 2025, he signed a new executive order that delayed the enforcement of this Biden-signed law, and then delayed it still-further, three more times after that, saying that he wanted to give American investors the time to negotiate controlling interest of US TikTok, rather than banning it.Those efforts eventually bore fruit in the shape of a new controlling entity called TikTok USDS Joint Venture LLC, which is made up of a bunch of non-Chinese investment entities, including US software behemoth Oracle, an Emirati investment firm called MGX, a US investment firm called Silver Lake, and a personal investment company owned by Michael Dell, the founder of Dell Technologies. There are other, smaller investors also involved, but the red thread that runs through almost all of them is that they’re big Trump supporters and funders, funneling a lot of money into Trump’s campaigns, and his family businesses.So six years after the initial legal salvo was fired at TikTok in the US, the local assets are now controlled by non-Chinese investors, though the original Chinese owner, ByteDance, still owns just under 20%, compared to about 15% apiece for Oracle, MGX, and Silver Lake.The new company’s board is majority-run by those investors, too, which means it’s majority-run by ardent Trump supporters. We don’t yet know what effect this will have on content within the app, but under full Chinese ownership, topics related to democracy, Tianamen Square, and the LGBTQ community, among others, were significantly downgraded in the algorithm, ensuring they were seldom shown to anyone, which in turn disincentivized content that those owners didn’t like while incentivizing content that was pro-China, and pro-Chinese government priorities.It’s considered to be likely, by analysts who watch these sorts of maneuverings, that the same will be true of this new entity, but for and against subject matter that the Trump administration is for and against. Which raises the possibility that the new US TikTok, while superficially the same as the previous US TikTok, will slowly go the way X, formerly Twitter, has gone under Elon Musk, which was dramatically pushed in a new direction under its own owner, focusing on his political and ideological priorities and punishing users who spoke against those priorities.TikTok could become more or less an extension of the Trump-verse, in other words, and could thus become something more akin to Trump’s own network, Truth Social, or other right-leaning and far-right social networks, like conservative YouTube-clone, Rumble, rather than something less ideological, or maybe I should say less overtly politically ideological, like Meta’s Facebook, Threads, and Instagram.Users have already noticed some changes to US TikTok after the change in ownership, though, including what sorts of data are collected.TikTok’s new privacy policy, which all users have to agree to before using the app, now that the platform has changed hands, says that TikTok will be using precise location tracking, keeping tabs on exactly where users are located via their device’s GPS. That’s compared to the app’s previous approximate location-tracking effort, which used SIM card and IP address data to understand general proximity—it still uses that data, too, but now, rather than knowing what neighborhood you’re probably in, it may also know what room in your house you’re scrolling from.The new US TikTok also tracks users’ interactions with AI tools, including their prompts, outputs, and metadata attached to said interactions, which includes details about where users are when they’re using such tools, and what time they used them.They also collect gobs of marketing data from outside sources, and based on the users’ activity within the app. So things you buy, websites and other apps you visit and use, and conversations you have will all be sucked up and agglomerated into a profile that’s then used to show you targeted advertising. This isn’t unique to US TikTok, but the company does seem to intend to make use of more such data, and to combine it with that other stuff it’s now collecting, to increase the price it can charge for ads, because they’ll be a lot more specifically targeted than before.Some users are beginning to comb through the new user agreement with a fine-toothed comb, noticing, in addition to those aforementioned major changes, that the company also reserves the right to collect information about your physical and mental health, to use identifying information in the videos and images you might share, and information gleaned from people and their identifying characteristics in images and videos, and to collect biometric data, which usually means eyes and faces and walking gate and things like that, to differentiate and track people across such content. They can keep tabs on your sex life, sexual orientation and gender, your drug usage, your ethnic and racial origins, your citizenship and immigration status, your financial situation and information—all sorts of stuff is

This week we talk about war, inflation, and currency devaluation.We also discuss tyrants, police violence, and social media threats.Recommended Book: Post-Growth Living by Kate SoperTranscriptBack in mid-June of 2025, a shooting war erupted between Iran and Israel, with Israeli military forces launching attacks against multiple Iranian military sites, alongside sites associated with its nuclear program and against individual Iranian military leaders.Iran responded to these strikes, which left a lot of infrastructural damage and several military leaders assassinated, with large waves of missiles and drones against both Israeli and allied military targets, and soon after, later the same month, both sides agreed on a ceasefire and that was that.Following that blip of a war, though, Iran’s economy suffered greatly. It already wasn’t doing well, in part due to the crippling sanctions enforced by the US government for years, but also because of persistent mismanagement by Iran’s ruling regime, and the resultant deterioration of local infrastructure, both physical and bureaucratic.Millions of people fled Iranian urban centers during the war with Israel, and while most of them returned when the ceasefire was brokered, the pace of life and other fundaments of these cities never got back up to where they were, before, as there have been fairly consistent blackouts that have kept people from being able to function as normal, and these outages have also kept businesses from getting back on their feet. That, in turn, has resulted in closures and firings and an overall reduction in economic activity.The general hamhandedness of the government has amplified these issues, and the countless other issues of trying to exist within a country that is being so persistently targeted—both in the sense of those crushing sanctions from the US, but also in the sense of being periodically struck by Israel—has dramatically increased uncertainty throughout Iran these past several years.Even before that brief war, Iran was already on the backfoot, having suffered the loss of their local proxies, including the Assad regime in Syria, Hezbollah in Lebanon, the Houthis in Yemen, and Hamas in the Gaza Strip—all of which have been either severely weakened by Israel in recent years, or functionally wiped out—and that in turn has more directly exposed them to meddling and attacks from their key opposition, which includes the US, Israel, and Saudi Arabia.That new vulnerability has put the Iranian government on high-alert, and the compounding effects of all that infrastructural damage, mismanagement, and the need to reallocate more resources to defense has left the country suffering very high levels of inflation, a severely devalued currency, regular blackouts, mass unemployment, a water shortage, and long-time repression from a government that is in many ways more paranoid and flailing than in any time in recent memory.What I’d like to talk about today is a recent wave of protests across Iran and why the US government is apparently considering taking action to support protestors against the Iranian government.—Iran has long suffered all sorts of issues, including regular efforts by ethnic secessionists to pull it apart into pieces they periodically occupy and want to govern, themselves, and concerns from citizens that the government spends a whole lot of their time and the nation’s resources enriching themselves, oppressing the citizenry, funding what seems to be a pointless nuclear program, and prioritizing their offensive efforts against Israel and their other regional enemies, often by arming and funding those aforementioned, now somewhat defunct proxy militias and militaries.On top of all that, as of October 2025, inflation in Iran had surged to 48.6% and the Iranian currency, the rial, dropped in value to 1.45 million per dollar. The government tried to artificially boost the value of the rial to 1.38 million per dollar in early January of 2026, but it dropped further, to 1.5 million per dollar a few days later, hitting a record low. This combined with that wild inflation rate, made the basic fundamentals of life, food, electricity, and so on, unaffordable, even for those who still had jobs, which was an ever-shrinking portion of the population.For context, the drop of the rial to a value of 1.38 million per dollar, the boosted value, represented a loss of about 40% of the rial’s value since June of 2025, just before that war with Israel, which is a staggering loss, as that means folk’s life savings lost that much in about half a year.When currency values and inflation hit that level of volatility, doing business becomes difficult. It often makes more sense to close up shop than to try to keep the doors open, because you don’t know if the price you charge for your product or service will make you a profit or not: there’s a chance you’ll sell things at a loss, because the value of the money you receive and the cost of goods you require, both to survive and to keep your business functioning, will change before the day ends, or before the sale can be completed.Iran’s economic crisis has further exploded in the past few weeks, then, because all those issues have compounded and spiraled to the point that simply selling things and buying things have become too risky for many people and entities, and that means folks are having even more trouble getting food and keeping the lights on than before; which becomes a real survival issue, on top of the regular crackdowns and abuses by the government that they’ve suffered in various ways for decades.In 2022, those abuses and limits on personal rights led to large protests that were catalyzed by the death of a 22-year-old woman named Mahsa Amini, who was in police custody for allegedly wearing her hijab improperly. Those 2022 protests were historically large—the biggest in the country, by some estimates at least, since the 1979 Islamic Revolution.On December 28 2025, a group of shopkeepers in Iran’s capital city, Tehran, went on strike, closing their shops in protest against what’s been happening with Iran’s economy; again, it’s basically impossible to safely do business in a country with that much inflation and currency devaluation happening.Other shopkeepers followed suit, and large protests formed around these closed shops. Those protests flooded social media platforms in short order, protestors shouting slogans that indicated they were pissed off about all the economic mismanagement in the country, and then eventually that led to anti-government slogans being shouted, as well.Things remained peaceful at these protests, at first, and they expanded across the country within the next few days, shops closing and people filling the streets.By the fourth day, police had started to use live ammunition and tear gas against protestors, some of the protestors were killed, and things spiraled from there.By December 31, the government ordered a total, nationwide business shutdown, to try to get ahead of these protests, which again tended to revolve around the shutdown of businesses in protest—the government said they were making this call because of cold weather, but the writing was kind of on the wall at this point that they were scrambling to make it look like businesses were shutting down because they said so, not in protest of the government.The government also announced that they would start cracking down on protestors, hard, and on the first day of 2026, things escalated further, police using even more force against those who gathered, which of course led to more protests in more places, more angry slogans being shouted, and more protestor deaths at the hands of government forces.Protests had spread to all 31 Iranian provinces by early January of 2026, and at this point there were only 17 confirmed deaths.US President Donald Trump got involved around this time, maybe feeling confident following the successful nighttime grab of Venezuelan President Maduro; whatever the case, he warned the Iranian government not to shoot protestors, or the US government might have to get involved, coming to the protestors’ rescue.Iran’s government responded by saying the rioters must be put in their place, suppressing the funerals of protestors, and muffling local internet service, slowing down access speeds and increasing the number of outages by about a third. They threatened to execute hundreds of protestors by hanging, then said they wouldn’t. Trump declared this to be a personal victory, though the Iranian government has used his insinuation of himself into the matter to position the fight as Iran against the US, the protestors backed by their great enemy, which has shown itself to be responsible for these protests.The government then started forcing captured protestors to make confessions on video, which only seemed to further anger the non-arrested protestors, and some protestors began to fight back, in one case setting a police officer on fire, and in other cases local militia groups defended protestors against police, leading to several deaths.Iran’s government shut down more communication services in an attempt to regain control, in some cities taking down the internet completely, though some information, photos and videos of police abuses of protestors still made it out into the wider world using satellite services like Starlink, and by the 9th of January, protests reached a scale that rivaled and maybe surpassed those seen during the 1979 Islamic Revolution, and protestors began to set fire to buildings associated with the Islamic Republic, the government, and directly clashing with security forces in some cases.Hundreds of people were reportedly killed per day from that point forward, and thousands were rushed to hospitals, overwhelming local doctors.Thousands of people were also violently killed by police, under cover of the now complete internet blackout, and on January 10th, it was estimated that around 2,000 pro

This week we talk about Venezuela, Maduro, and international law.We also discuss sour crude, extrajudicial killings, and Greenland.Recommended Book: The Keep by F. Paul WilsonTranscriptBack in mid-November of 2025, I did an episode on extrajudicial killings, focusing on the targeting of speedboats, mostly from Venezuela headed toward the United States, by the US military. These boats were allegedly carrying drugs meant for the US market, and the US government justified these strikes by saying, basically, we have a right to protect ourselves, protect our citizens from the harm caused by these illegal substances, and if we have to keep taking out these boats and killing these people to do that, we will.There’s been a lot of back-and-forthing about the legitimacy of this approach, both in the sense that not all of these boats have been shown to be carrying drugs, some just seemed to be fishing boats in the wrong place at the wrong time, and in the sense that launching strikes without the go-ahead of Congress in the US is a legally dubious business. There was also the matter of some alleged follow-up strikes, which seemed to be intended to kill people who survived the initial taking-out of the boats, which is a big international human rights no no, to the point of potentially being a war crime.All of this happened within the context of a war of words between US President Trump’s second administration and the increasingly authoritarian regime of Venezuelan President Nicolás Maduro, who followed the previous president Hugo Chávez as his hand-picked successor, and has more or less completed the authoritarian process of dissolving, coopting, or diminishing all aspects of the Venezuelan government that might ever check his power, which allowed him, in 2024, to bar the very popular, now Nobel Peace Prize winning candidate María Corina Machado from running, and her sub-in candidate, like previous Maduro opponent Juan Guaido, seems to have won the election by a fair bit, and in an internationally provable way, but Maduro’s government faked results that made it look like he won, and his single-party rule has since continued unabated.Or rather, it continued unabated until the early morning of January 3, 2026, around 2am, when US Operation Absolute Resolve kicked into action, leading to the—depending on who you ask—justified captured or illegal kidnapping—of Maduro and his wife from a stronghold in his country.And that’s what I’d like to talk about today: the operation itself, but also the consequences and potential meaning of it within the context of other important things happening in the world right now.—Maduro is immensely popular with about a fifth of the Venezuelan population, but essentially everyone else is strongly opposes him and his iron-fisted rule.It’s estimated that between 2017 and 2025, just shy of 8 million people, which is more than 20% of Venezuela’s 2017 population, has fled the country in order to escape a tyrannical government and its failed policies, which have collapsed the economy, made getting working and feeding oneself and one’s family difficult, and made crime, conflict, and the state-sanctioned oppression of anyone who doesn’t kowtow to the ruling party a commonplace thing.Trump speculated about the possibility of invading Venezuela even in his first administration, and part of the overt rationale was that it’s run by a failed government that most of the locals hate, so it would be an easy win. That justification shifted to orient around immigration and drugs by his second administration, and then more recently, Trump has said publicly that the real issue here is that Venezuela stole a bunch of US company-owned oil assets when it nationalized the industry back in the day, and those assets should be recaptured, given back to the US.Operation Absolute Resolve took months to plan and only about two and a half hours to complete. By most objective measures it was a spectacular military and intelligence success, especially considering all the moving parts and thus, all the things that could have gone wrong.The operation apparently involved at least 150 aircraft of various sorts, a spy within Maduro’s government, and months of surveillance, which helped them establish Maduro’s habits and routines, and that allowed them to map out where he would be, when, and what to expect going in to get him. All of these patterns changed in September of 2025 when US warships started massing in Caribbean, as Maduro started to get a little paranoid—justifiably, as it turns out—and he started moving between eight different locations, seldom sleeping in the same place more than one night in a row.He was eventually grabbed from a military base in Caracas, Venezuela’s capitol, and to make that happen the US military assets in the area had to take out local aviation and air defenses so that US Delta Force troops could be carried in by helicopter. Several air bases and communications centers were taken out by missiles, and fighter jets were bombed on air base tarmacs. Trump alluded that a cyberattack of some kind might have also been used to take out power in the area, though satellite imagery suggests bombs might have been used against a power station to make that happen.The operation apparently went almost exactly as planned, though a helicopter was damaged and the Delta Force team killed a large part of Maduro’s security team when he refused to surrender. A few US soldiers were wounded, but none were killed, and Venezuelan officials said, in the aftermath, that lat least 40 Venezuelans were killed throughout the country during the operation. Maduro and his wife were swept from the base before they could lock themselves in their safe room, and they were tucked into the helicopters which headed out to sea, landing them on the USS Iwo Jima, which is an assault ship.All of this took a matter of hours and, again, is generally considered to be an objective success, in terms of precision, outcome, and other such metrics. Morally, legally, and politically, however, the operation is receiving a far more mixed response, and that response is continuing to play out as Maduro works his way through a bizarre version of the US justice system where he’s being sent to court for drug dealing.In the US, Trump supporters have generally said all of this was a good, smart move, though some maintain that US involvement in any kind of international conflict is a waste of time, effort, and resources, and they worry about getting bogged down in another Iraq or Afghanistan-style conflict.Everyone else is generally against the effort, even those who admit that Maduro was a tyrant who needed to go—it’s good that he’s gone, but the way in which it was done is not just questionable, but worrying because of what it says about Trump’s capacity to unilaterally launch kidnapping missions against the leaders of other countries. Not a good look, but also kind of scary.Internationally the response is generally aligned with the latter opinion, especially in other countries that Trump has at some point threatened, which is most of them.Governments in South and Central America have been especially concerned, however, because one of Trump’s newer messaging efforts has revolved around the concept of a Western Hemisphere basically owned and protected by the US. Do whatever you want in the rest of the world, basically, but everything over here is ours. This has raised the possibility that an emboldened Trump might attempt similar maneuvers soon, including possibly claiming the Panama Canal for the US again, or grabbing the leaders of other Latin American countries he doesn’t think are kowtowing enthusiastically enough; toeing the new international line that he’s drawing, basically.He’s also renewed messaging around the possible purchase or capture of Greenland, which has been raising alarm bells across Europe in particular. Greenland is considered to be a vital strategic base for US security, and it would grant potential access to an abundance of also strategically and economically important minerals, both on land and underwater, but Greenland is an autonomous territory of Denmark, and most European leaders have said something along the lines of “if the US takes action to militarily claim Greenland, that’ll be the end of NATO,” an organization that was originally founded to help protect the world, and Europe especially, from military conquest from the Soviet Union, but which, at that point, might be recalibrated to protect against incursions from the US, as well.NATO has been mostly funded and perpetuated by the US until recently, however, so there’s a chance that something else would need to replace it, if the US is no longer providing nuclear deterrence as the ultimate whammy against a potential Russian invasion of its European neighbors.The UN has also indicated that they consider this operation to be a violation of international law, and have called it a dangerous precedent—because one nation capturing the leader of another nation, unilaterally, kind of negates the purpose of negotiations and the whole concept of international law. That kind of use of force is meant to be granted by the UN, not attempted secretively and outside the bounds of international processes for such things.All that said, the Trump administration seems to be leaning into the victory, gleefully talking about next-step potential targets, the most likely of which seem to be in Iran, a long-time US opponent, and a target of this administration last year, when the US attacked Iranian nuclear facilities alongside Israel.There are ongoing, very large and seemingly significant protests happening across Iran right now, so the US could see this as another opportunity to topple another unpopular authoritarian regime while also getting the chance to flex its military and intelligence capabilities at a moment in which another big-name player in that space, Russia, is generally flailing; it’s failed t

This week we talk about prediction markets, incentives, and gambling addiction.We also discuss insider trading, spot-fixing, and Gatorade.Recommended Book: The Kingdom, the Power, and the Glory by Tim AlbertaTranscriptPrediction markets are hundreds of years old, and have historically been used to determine the likelihood of something happening.In 1503, for instance, there was a market to determine who would become the next pope, and from the earliest days of commercial markets, there were associated prediction markets that were used to gauge how folks thought a given business would do during an upcoming economic quarter.The theory here is that while you can just ask people how well they think a political candidate will fare in an election or who they think will become the next pope, often their guesses, their assumptions, or their analysis will be swayed by things like political affiliation or maybe even what they think they’re meant to say—the popular papal candidate, for instance, or the non-obvious, asymmetric position on a big commercial enterprise that might help an analyst reinforce their brand as a contrarian.If you introduce money into the equation, though, forcing people to put down real currency on their suspicions and predictions, and give them the chance to earn money if they get things right, that will sometimes nudge these markets away from those other incentives, making the markets commercial enterprises of their own. It can shift the bias away from posturing and toward monetization, and that in turn, in theory at least, should make prediction markets more accurate because people will try to align themselves with the actual, real-deal outcome, rather than the popular—with their social tribe, at least—or compellingly unpopular view.This is the theory that underpins entities like Polymarket, Kalshi, Manifold Markets, and many other online prediction markets that have arisen over the past handful of years as regulations on these types of businesses have been eased, and as they’ve begun to establish themselves as credible players in the predicting-everything space.In politics in particular, these markets have semi-regularly shown themselves to be better gauges of who will actually win elections than conventional polls and surveys, and though their records are far from perfect and still heavily biased in some cases, such community-driven predictions from money-motivated markets are gaining credibility because of their capacity to incentivize people to put their money where their mouths are, and to try to profit from accurate preordination.The flip-side of these markets, and some might even say a built-in flaw with no obvious solution, is that they are rife with insider trading: people who are in the position to know things ahead of time making in some cases millions of dollars by placing big bets that, for them, aren’t bets at all, because they know what will or what is likely to happen.This seems to have occurred at least a few times with big political events in 2025, and it’s anticipated that it could become an even bigger issue in the future, especially for markets that use cryptocurrencies to manage payments, as those are even less likely than their fiat currency peers to keeps solid tabs on who’s actually behind these bets, and thus who might be trading on knowledge that they’re not supposed to be trading on.That said, it could be argued that such insider trading makes these markets even more accurate, eventually at least. And that points us toward another problem: the possibility that someone on the inside might look at a market and realize they can make a killing if they use their position, their power to sway these markets after placing a bet, giving them the ability to assure a payout by abusing their position—major events being influenced by the possibility of a community-funded payday for those in control.What I’d like to talk about today is the same general principle as it’s playing out in the sports world, and why the huge sums of money that are now sloshing around in the sports betting industry in the US are beginning to worry basically everyone, except the sports betting companies themselves.—In October of 2025, the head coach of the NBA basketball team, the Portland Trail Blazers, Chauncey Billups, Miami Heat player Terry Rozier, and former NBA player Damon Jones, and about 30 other people were arrested by the FBI due to their alleged illegal sports gambling activities. Rozier was already under investigation following unusual betting activity that was linked to his performance in a 2023 game—he was later cleared of wrongdoing, but the implication then and in this more recent instance is that he and those other folks who were rounded up by the FBI may have been involved in rigging things so they could get a big payoff on gambling markets.Similar things have been happening across the sports world, including a lifetime ban for Jontay Porter, a former Toronto Raptors player, who apparently gave confidential information to people who were placing bets on NBA games—he later pleaded guilty to conspiracy to commit wire fraud as a result of that investigation—and in November of 2025 two Major League Baseball players, both of them pitchers for the Cleveland Guardians, Emmanuel Clase and Luis Ortiz, were charged by federal prosecutors for allegedly rigging pitches to benefit people betting on those pitches; they’ve been charged with wire fraud and money laundering, and each could face up to 65 years in prison.And those are just a few of the many instances of game-rigging that have been alleged in recent years, the specifics of which vary, but the outcome is always to give someone an advantage in these markets, which are only recently broadly legal across the United States, and which thus allow folks with the right connections or some money to invest ahead of time to, for instance, pay a pitcher to throw an inning, or pay a coach to tell them who will be benched and when, so that they can make a big wager with less of a risk, or in some cases, no risk at all.One of the big issues here is that rather than simply being a which-team-will-win sort of thing, many of these bets are highly specific and granular, including what are called proposition or prop bets that allow folks to gamble on the number of strikeouts a pitcher will tally in a given inning and other very specific things.If a pitcher were to then place a bet, perhaps through an intermediary, on their own prop bet-related performance, they would stand a decent chance of tallying the right number of strikes and balls. They could also sell that information to someone else, taking a guaranteed payout in exchange for the foreknowledge they grant that gambler, who could then do what they want with the information, and then if they do well with it, they could pay that pitcher to do the same again in the future.This type of bet is called spot-fixing, and it’s seen across prediction markets, not just sports markets. Pitchers can fix an inning of a game, but poker players can also go all-in or fold a given number of times in a tournament, and the folks in charge of dumping Gatorade over the winning coach following a Super Bowl event can leak that color, based on their foreknowledge of the setup, to gamblers—these markets are sprawling and varied, and anyone in any position of power who can make decisions about such things, or who’s involved enough to leak information can do so at a profit, either themselves putting down money on spot-fixed prop bets, or selling that information to those who will themselves place a bet.The issue sports organizations in the US are now running into is that while they aligned themselves with sports gambling entities like DraftKings and FanDuel after these platforms were legalized in more states following the striking-down of a federal ban on such things in 2018—as I record this, they’re currently legal in 31 states, alongside Washington DC and Puerto Rico—and they’ve profited a fair bit from that, allowing these businesses to become sponsors, to slap their logos on everything, and to generally become interwoven with the leagues themselves; despite all that, they’ve also created a sports culture in which betting is ultra-common, and that means fans are no longer just fans, they’re putting down money on various possible sports-related outcomes.That means folks who were maybe previously die-hard fans of their local team may no longer just be disappointed when their team loses, they’ll be financially impacted, perhaps even devastated. And many athletes who play on these teams, in these leagues, are now suffering all kinds of abuse and threats from people who decided to put a lot of money on their performance, but who failed to win a game, or maybe even throw the exact right number of strikes and balls in a given inning.This points at two big issues with sports betting in the US right now.First is that there’s a lot of money splashing around in this space. An estimated $160-170 billion was wagered by US citizens in 2025 alone, generating about $16.4 billion in revenue for sportsbooks—the entities that take these sorts of bets.That’s likely a significant undercount, too, as more generalist prediction markets are also getting involved in the sports betting game, blending this type of gambling with other sorts of prediction markets, like those related to politics and international happenings, like war.And second, a lot of people are gambling a lot of money on sports stuff right now, and that’s becoming an issue. In October of 2025, a Pew Research poll found that 43% of US adults think legalized sports betting is bad for society, up from 34% in 2022, and 40% says it’s bad for sports, up from 33%. A whopping 22% of US adults say they personally bet money on sports in the past year, up from 19% in 2022, and 10%, one in ten American adults, say they have placed a sports bet online in the past year, up from 6% in 2022.There has be

This week we talk about energy consumption, pollution, and bipartisan issues.We also discuss local politics, data center costs, and the Magnificent 7 tech companies.Recommended Book: Against the Machine by Paul KingsnorthTranscriptIn 2024, the International Energy Agency estimated that data centers consumed about 1.5% of all electricity generated, globally, that year. It went on to project that energy consumption by data centers could double by 2030, though other estimates are higher, due to the ballooning of investment in AI-focused data centers by some of the world’s largest tech companies.There are all sorts of data centers that serve all kinds of purposes, and they’ve been around since the mid-20th century, since the development of general purposes digital computers, like the 1945 Electronic Numerical Integrator and Computer, or ENIAC, which was programmable and reprogrammable, and used to study, among other things, the feasibility of thermonuclear weapons.ENIAC was built on the campus of the University of Pennsylvania and cost just shy of $500,000, which in today’s money would be around $7 million. It was able to do calculators about a thousand times faster than other, electro-mechanical calculators that were available at the time, and was thus considered to be a pretty big deal, making some types of calculation that were previously not feasible, not only feasible, but casually accomplishable.This general model of building big-old computers at a center location was the way of things, on a practical level, until the dawn of personal computers in the 1980s. The mainframe-terminal setup that dominated until then necessitated that the huge, cumbersome computing hardware was all located in a big room somewhere, and then the terminal devices were points of access that allowed people to tap into those centralized resources.Microcomputers of the sort of a person might have in their home changed that dynamic, but the dawn of the internet reintroduced something similar, allowing folks to have a computer at home or at their desk, which has its own resources, but to then tap into other microcomputers, and to still other larger, more powerful computers across internet connections. Going on the web and visiting a website is basically just that: connecting to another computer somewhere, that distant device storing the website data on its hard drive and sending the results to your probably less-powerful device, at home or work.In the late-90s and early 2000s, this dynamic evolved still further, those far-off machines doing more and more heavy-lifting to create more and more sophisticated online experiences. This manifested as websites that were malleable and editable by the end-user—part of the so-called Web 2.0 experience, which allowed for comments and chat rooms and the uploading of images to those sites, based at those far off machines—and then as streaming video and music, and proto-versions of social networks became a thing, these channels connecting personal devices to more powerful, far-off devices needed more bandwidth, because more and more work was being done by those powerful, centrally located computers, so that the results could be distributed via the internet to all those personal computers and, increasingly, other devices like phones and tablets.Modern data centers do a lot of the same work as those earlier iterations, though increasingly they do a whole lot more heavy-lifting labor, as well. They’ve got hardware capable of, for instance, playing the most high-end video games at the highest settings, and then sending, frame by frame, the output of said video games to a weaker device, someone’s phone or comparably low-end computer, at home, allowing the user of those weaker devices to play those games, their keyboard or controller inputs sent to the data center fast enough that they can control what’s happening and see the result on their own screen in less than the blink of an eye.This is also what allows folks to store backups on cloud servers, big hard drives located in such facilities, and it’s what allows the current AI boom to function—all the expensive computers and their high-end chips located at enormous data centers with sophisticated cooling systems and high-throughput cables that allow folks around the world to tap into their AI models, interact with them, have them do heavy-lifting for them, and then those computers at these data centers send all that information back out into the world, to their devices, even if those devices are underpowered and could never do that same kind of work on their own.What I’d like to talk about today are data centers, the enormous boom in their construction, and how these things are becoming a surprise hot button political issue pretty much everywhere.—As of early 2024, the US was host to nearly 5,400 data centers sprawled across the country. That’s more than any other nation, and that number is growing quickly as those aforementioned enormous tech companies, including the Magnificent 7 tech companies, Nvidia, Apple, Alphabet, Microsoft, Amazon, Meta, and Tesla, which have a combined market cap of about $21.7 trillion as of mid-December 2025, which is about two-thirds of the US’s total GDP for the year, and which is more than the European Union’s total GDP, which weighs in at around $19.4 trillion, as of October 2025—as they splurge on more and more of them.These aren’t the only companies building data centers at breakneck speed—there are quite a few competitors in China doing the same, for instance—but they’re putting up the lion’s share of resources for this sort of infrastructure right now, in part because they anticipate a whole lot of near-future demand for AI services, and those services require just a silly amount of processing power, which itself requires a silly amount of monetary investment and electricity, but also because, first, there aren’t a lot of moats, meaning protective, defensive assets in this industry, as is evidenced by their continual leapfrogging of each other, and the notion that a lot of what they’re doing, today, will probably become commodity services in not too long, rather than high-end services people and businesses will be inclined to pay big money for, and second, because there’s a suspicion, held by many in this industry, that there’s an AI shake-out coming, a bubble pop or bare-minimum a release of air from that bubble, which will probably kill off a huge chunk of the industry, leaving just the largest, too-big-to-fail players still intact, who can then gobble up the rest of the dying industry at a discount.Those who have the infrastructure, who have invested the huge sums of money to build these data centers, basically, will be in a prime position to survive that extinction-level event, in other words. So they’re all scrambling to erect these things as quickly as possible, lest they be left behind.That construction, though, is easier said than done.The highest-end chips account for around 70-80% of a modern data center’s cost, as these GPUs, graphical processing units that are optimized for AI purposes, like Nvidia’s Blackwell chips, can cost tens of thousands of dollars apiece, and millions of dollars per rack. There are a lot of racks of such chips in these data centers, and the total cost of a large-scale AI-optimized data center is often somewhere between $35 and $60 billion.A recent estimate by McKinsey suggests that by 2030, data center investment will need to be around $6.7 trillion a year just to keep up the pace and meet demand for compute power. That’s demand from these tech companies, I should say—there’s a big debate about where there’s sufficient demand from consumers of AI products, and whether these tech companies are trying to create such demand from whole cloth, to justify heightened valuations, and thus to continue goosing their market caps, which in turn enriches those at the top of these companies.That said, it’s a fair bet that for at least a few more years this influx in investment will continue, and that means pumping out more of these data centers.But building these sorts of facilities isn’t just expensive, it’s also regulatorily complex. There are smaller facilities, akin to ENIAC’s campus location, back in the day, but a lot of them—because of the economies of scale inherent in building a lot of this stuff all at once, all in the same place—are enormous, a single data center facility covering thousands of acres and consuming a whole lot of power to keep all of those computers with their high-end chips running 24/7.Previous data centers from the pre-AI era tended to consume in the neighborhood of 30MW of energy, but the baseline now is closer to 200MW. The largest contemporary data centers consume 1GW of electricity, which is about the size of a small city’s power grid—that’s a city of maybe 500,000-750,000 people, though of course climate, industry, and other variables determine the exact energy requirements of a city—and they’re expected to just get larger and more resource-intensive from here.This has resulted in panic and pullbacks in some areas. In Dublin, for instance, the government has stopped issuing new grid connections for data centers until 2028, as it’s estimated that data centers will account for 28% of Ireland’s power use by 2031, already.Some of these big tech companies have read the writing on the wall, and are either making deals to reactivate aging power plants—nuclear, gas, coal, whatever they can get—or are saying they’ll build new ones to offset the impact on the local power grid.And that impact can be significant. In addition to the health and pollution issues caused by some of the sites—in Memphis, for instance, where Elon Musk’s company, xAI, built a huge data center to help power his AI chatbot, Grok, the company is operating 35 unpermitted gas turbines, which it says are temporary, but which have been exacerbating locals’ health issues and particulate numbers—in addition to

This week we talk about NVIDIA, AI companies, and the US economy.We also discuss the US-China chip-gap, mixed-use technologies, and export bans.Recommended Book: Enshittification by Cory DoctorowTranscriptI’ve spoken about this a few times in recent months, but it’s worth rehashing real quick because this collection of stories and entities are so central to what’s happening across a lot of the global economy, and is also fundamental, in a very load-bearing way, to the US economy right now.As of November of 2025, around the same time that Nvidia, the maker of the world’s best AI-optimized chips at the moment became the world’s first company to achieve a $5 trillion market cap, the top seven highest-valued tech companies, including Nvidia, accounted for about 32% of the total value of the US stock market.That’s an absolutely astonishing figure, as while Nvidia, Apple, Microsoft, Alphabet, Amazon, Broadcom, and Meta all have a fairly diverse footprint even beyond their AI efforts, a lot of that value for all of them is predicated on expected future income; which is to say, their market caps, their value according to that measure, is determined not by their current assets and revenue, but by what investors think or hope they’ll pull in and be worth in the future.That’s important to note because historically the sorts of companies that have market caps that are many multiples of their current, more concrete values are startups; companies in their hatchling phase that have a good idea and some kind of big potential, a big moat around what they’re offering or a blue ocean sub-industry with little competition in which they can flourish, and investment is thus expected to help them grow fast.These top seven tech companies, in contrast, are all very mature, have been around for a while and have a lot of infrastructure, employees, expenses, and all the other things we typically associated with mature businesses, not flashy startups with their best days hopefully ahead of them.Some analysts have posited that part of why these companies are pushing the AI thing so hard, and in particular pushing the idea that they’re headed toward some kind of generally useful AI, or AGI, or superhuman AI that can do everyone’s jobs better and cheaper than humans can do them, is that in doing so, they’re imagining a world in which they, and they alone, because of the costs associated with building the data centers required to train and run the best-quality AI right now, are capable of producing basically an economy’s-worth of AI systems and bots and machines operated by those AI systems.In other words, they’re creating, from whole cloth, an imagined scenario in which they’re not just worthy of startup-like valuations, worthy of market caps that are tens or hundreds of times their actual concrete value, because of those possible futures they’re imagining in public, but they’re the only companies worthy of those valuation multiples; the only companies that matter anymore.It’s likely that even if this is the case, that the folks in charge of these companies, and the investors who have money in them who are likely to profit when the companies grow and grow, actually do believe what they’re telling everyone about the possibilities inherent in building these sorts of systems.But there also seems to be a purely economic motive for exaggerating a lot and clearing out as much of the competition as possible as they grow bigger and bigger. Because maybe they’ll actually make what they’re saying they can make as a result of all that investment, that exuberance, but maybe, failing that, they’ll just be the last companies standing after the bubble bursts and an economic wildfire clears out all the smaller companies that couldn’t get the political relationships and sustaining cash they needed to survive the clear-out, if and when reality strikes and everyone realizes that sci-fi outcome isn’t gonna happen, or isn’t gonna happen any time soon.What I’d like to talk about today is a recent decision by the US government to allow Nvidia to sell some of its high-powered chips to China, and why that decision is being near-universally derided by those in the know.—In early December 2025, after a lot of back-and-forthing on the matter, President Trump announced that the US government will allow Nvidia, which is a US-based company, to export its H200 processors to China. He also said that the US government will collect a 25% fee on these sales.The H200 is Nvidia’s second-best chip for AI purposes, and it’s about six-times as powerful as the H20, which is currently the most advanced Nvidia chip that’s been cleared for sale to China. The Blackwell chip that is currently Nvidia’s most powerful AI offering is about 1.5-times faster than the H200 for training purposes, and five-times faster for AI inferencing, which is what they’re used for after a model is trained, and then it’s used for predictions, decisions, and so on.The logic of keeping the highest-end chips from would-be competitors, especially military competitors like China, isn’t new—this is something the US and other governments have pretty much always done, and historically even higher-end gaming systems like Playstation consoles have been banned for export in some cases because the chips they contained could be repurposed for military things, like plucking them out and using them to guide missiles—Sony was initially unable to sell the Playstation 2 outside of Japan because it needed special permits to sell something so militarily capable outside the country, and it remained unsellable in countries like Iraq, Iran, and North Korea throughout its production period.The concern with these Nvidia chips is that if China has access to the most powerful AI processors, it might be able to close the estimated 2-year gap between US companies and Chinese companies when it comes to the sophistication of their AI models and the power of their relevant chips. Beyond being potentially useful for productivity and other economic purposes, this hardware and software is broadly expected to shape the next generation of military hardware, and is already in use for all sorts of wartime and defense purposes, including sophisticated drones used by both sides in Ukraine. If the US loses this advantage, the thinking goes, China might step up its aggression in the South China Sea, potentially even moving up plans to invade Taiwan.Thus, one approach, which has been in place since the Biden administration, has been to do everything possible to keep the best chips out of Chinese hands, because that would ostensibly slow them down, make them less capable of just splurging on the best hardware, which they could then use to further develop their local AI capabilities.This approach, however, also incentivized the Chinese government to double-down on their own homegrown chip industry. Which again is still generally thought to be about 2-years behind the US industry, but it does seem to be closing the gap rapidly, mostly by copying designs and approaches used by companies around the world.An alternative theory, the one that seems to be at least partly responsible for Trump’s about-face on this, is that if the US allows the sale of sufficiently powerful chips to China, the Chinese tech industry will become reliant on goods provided by US companies, and thus its own homegrown AI sector will shrivel and never fully close that gap. If necessary the US can then truncate or shut down those shipments, crippling the Chinese tech industry at a vital moment, and that would give the US the upper-hand in many future negotiations and scenarios.Most analysts in this space no longer think this is a smart approach, because the Chinese government is wise to this tactic, using it itself all the time. And even in spaces where they have plenty of incoming resources from elsewhere, they still try to shore-up their own homegrown versions of the same, copying those international inputs rather than relying on them, so that someday they won’t need them anymore.The same is generally thought to be true, here. Ever since the first Trump administration, when the US government started its trade war with China, the Chinese government has not been keen on ever relying on external governments and economies again, and it looks a lot more likely, based on what the Chinese government has said, and based on investments across the Chinese market on Chinese AI and chip companies following this announcement, that they’ll basically just scoop up as many Nvidia chips as they can, while they can, and primarily for the purpose of reverse-engineering those chips, speeding up their gap-closing with US companies, and then, as soon as possible, severing that tie, competing with Nvidia rather than relying on it.This is an especially pressing matter right now, then, because the US economy, and basically all of its growth, is so completely reliant on AI tech and the chips that are allowing that tech to move forward.If this plan by the US government doesn’t pan out and ends up being a short-term gain situation, a little bit of money earned from that 25% cut the government takes, and Ndvidia temporarily enriching itself further through Chinese sales, but in exchange both entities give up their advantage, long term, to Chinese AI companies and the Chinese government, that could be bad not just for AI companies around the world, which could be rapidly outcompeted by Chinese alternatives, but also all economies exposed to the US economy, which could be in for a long term correction, slump, or full-on depression.Show Noteshttps://www.nytimes.com/2025/12/09/us/politics/trump-nvidia-ai-chips-china.htmlhttps://arstechnica.com/tech-policy/2025/12/us-taking-25-cut-of-nvidia-chip-sales-makes-no-sense-experts-say/https://www.pcmag.com/news/20-years-later-how-concerns-about-weaponized-consoles-almost-sunk-the-ps2https://archive.is/20251211090854/https://www.reuters.com/world/china/us-open-up-exports-nvidi

This week we talk about in-game skins, investment portfolios, and Counter-Strike 2.We also discuss ebooks, Steam, and digital licenses.Recommended Book: Apple in China by Patrick McGeeTranscriptAlmost always, if you buy an ebook or game or movie or music album online, you’re not buying that ebook, or that game, or whatever else—you’re buying a license that allows you access it, often on a specified device or in a specified way, and almost always in a non-transferrable, non-permanent manner.This distinction doesn’t matter much to most of us most of the time. If I buy an ebook, chances are I just want to read that ebook on the device I used to buy it, or the kindle attached to my Amazon or other digital book service account. So I buy the book, read it on my ebook reader or phone, and that’s that; same general experience I would have with a paperback or hardback book.This difference becomes more evident when you think about what happens to the book after you read it, though. If I own a hard-copy, physical book, I can resell it. I can donate it. I can put it in a Little Free Library somewhere in my neighborhood, or give it to a friend who I think will enjoy it. I can pick it up off my shelf later and read the exact same book I read years before. Via whichever mechanism I choose, I’m either holding onto that exact book for later, or I’m transferring ownership of that book, that artifact that contains words and/or images that can now be used, read, whatever by that second owner. And they can go on to do the same: handing it off to a friend, selling it on ebay, or putting it on a shelf for later reference.Often the convenience and immediacy of electronic books makes this distinction a non-issue for those who enjoy them. I can buy an ebook from Amazon or Bookshop.org and that thing is on my device within seconds, giving me access to the story or information that’s the main, valuable component of a book for most of us, without any delay, without having to drive to a bookstore or wait for it to arrive in the mail. That’s a pretty compelling offer.This distinction becomes more pressing, however, if I decide I want to go back and read an ebook I bought years ago, later, only to find that the license has changed and maybe that book is no longer accessible via the marketplace where I purchased it. If that happens, I no longer have access to the book, and there’s no recourse for this absence—I agreed to this possibility when I “bought” the book, based on the user agreement I clicked ‘OK’ or ‘I agree’ on when I signed up for Amazon or whichever service I paid for that book-access.It also becomes more pressing if, as has happened many times over the past few decades, the publisher or some other entity with control over these book assets decides to change them.A few years ago, for instance, British versions of Roald Dalh’s ‘Matilda’ were edited to remove references to Joseph Conrad, who has in recent times been criticized for his antisemitism and racist themes in his writing. Some of RL Stine’s Goosebumps books were edited to remove references to crushes schoolgirls had on their headmaster, and descriptions of an overweight character that were, in retrospect, determined to be offensive. And various racial and ethnic slurs were edited out of some of Agatha Christie’s works around the same time.Almost always, these changes aren’t announced by the publishers who own the rights to these books, and they’re typically only discovered by eagle-eyed readers who note that, for instance, the publishers decided to change the time period in which something occurred, which apparently happened in one of Stine’s works, without obvious purpose. This also frequently happens without the author being notified, as was the case with Stine and the edits made to his books. The publishers themselves, when asked directly about these changes, often remain silent on the matter.What I’d like to talk about today is another angle of this distinction between physically owned media and digital, licensed versions of the same, and the at times large sums of money that can be gained or lost based on the decisions of the companies that control these licensed assets.—Counter-Strike 2 is a first-person shooter game that’s free-to-play, was released in 2023, and was developed by a company called Valve.Valve has developed all sorts of games over the years, including the Counter-Strike, Half-Life, DOTA, and Portal games, but they’re probably best known for their Steam software distribution platform.Steam allows customers to buy all sorts of software, but mostly games through an interface that also provides chat services and community forums. But the primary utility of this platform is that it’s a marketplace for buying and selling games, and it has match-making features for online multiplayer games, serves as a sort of library for gamers, so all their games are launchable from one place, and it serves as a digital rights management hub, which basically means it helps game companies ensure users aren’t playing with pirated software—if you want to use steam to store and launch your games, they have to be legit, purchased games, not pirated ones.As of early 2025, it was estimated that Steam claimed somewhere between 75-80% of the PC gaming market, compared to competitors like the Epic Game Store, which was founded by the folks behind the wildly successful game, Fortnite, which can only claim something like 5%.And Counter-Strike is one of Valve’s, and Steam’s crown jewels. It’s a free-to-play game that was originally developed as a mod, a free add-on to another game Valve owns called Half-Life, but Valve bought up the rights to that mod and developed it into its own thing, releasing the initial entry in the series in 2000, several main-series games after that in subsequent years, and then Counter-Strike 2 came out in 2023, to much acclaim and fanfare.Counter-Strike 2 often has around a million players online, playing the game at any given moment, and its tournaments can attract closer to 1.5 million. As of early 2024, it was estimated that Counter-Strike 2 pulled in around a billion dollars a year for Valve, primarily via what are called Case Keys, which allow players to open in-game boxes, each key selling for $2.50. Valve also takes a 15% cut of all player-to-player sales of items conducted on the Steam Community Market, which is a secure ebay- or Amazon-like component of their platform where players can sell digital items from the game, which are primarily aesthetic add-ons, like skins for weapons, stickers, and clothing—things that allow players to look different in the game, as opposed to things that allow them to perform better, which would give players who spent the most money an unfair advantage and thus make the game less competitive and fun.Because this is a free game, though, and by many estimates a really balance and well-made one, a lot of people play it, and a lot of people want to customize the look of their in-game avatar. So being able to open in-game boxes that contain loot, and being able to buy and sell said loot on the Steam Community Market, has led to a rich secondary economy that makes that component of the game more interesting for players, while also earning Valve a whole lot of money on the backend for those keys and that cut of sales between players.In late-October of 2025, Valve announced a change in the rules for Counter-Strike 2, now allowing players to trade-up more item types, including previously un-trade-up-able items like gloves and knives, into higher-grade versions of the same. So common items could be bundled together and traded in for less common items, and those less common items could be bundled together and traded up for rare ones.This seems like a small move from the outside, but it roiled the CS2 in-game economy, by some estimates causing upwards of $2 billion to basically disappear overnight, because rare gloves and knives were at times valued at as much as $1.5 million; again, these are just aesthetic skins that change the look of a player’s avatar or weapons, but there’s enough demand for these things that some people are willing to pay that much for ultra-rare and unique glove and knife skins.Because of that demand, some players had taken to spending real money on these ultra-rare items, treating their in-game portfolios of skins as something like an investment portfolio. If you can buy an ultra-rare glove skin for $40,000 and maybe sell it later for twice that, that might seem like a really good investment, despite how strange it may seem to those not involved in this corner of the gaming world to spend $40,000 on what’s basically just some code in a machine that tells the game that the gloves on your avatar will look a certain way.This change, then, made those rarer gloves and knives, which were previously unattainable except by lottery-like chance, a lot more common, because people could trade up for them, increasing their chances of getting the ultra-rare stuff. The market was quickly flooded with more of these things, and about half the value of rare CS2 skins disappeared, initially knocking about $6 billion of total value from the market before stabilizing to around $1.5-2 billion.Volatility in this market continues, and people who invested a lot of money, sometimes their life savings, and sometimes millions of dollars into CS2 in-game skins, have been looking into potential legal recourse, though without much luck; Valve’s user agreements make very clear that players don’t own any of this stuff, and as a result, Valve can manipulate the market however they like, whenever they like.Just like with ebooks and movies we “buy” from Amazon and other services, then, these in-game assets are licensed to us, not sold. We may, at times, have a means of putting our license to some of these things on a secondary market, but that secondary market exists completely at the whim of the entity that actually owns the digital assets—in

This week we talk about floods, wildfires, and reinsurance companies.We also discuss the COP meetings, government capture, and air pollution.Recommended Book: If Anyone Builds It, Everyone Dies by Eliezer Yudkowsky and Nate Soares TranscriptThe urban area that contains India’s capital city, New Delhi, called the National Capital Territory of Delhi, has a population of around 34.7 million people. That makes it the most populous city in the country, and one of the most populous cities in the world.Despite the many leaps India has made over the past few decades, in terms of economic growth and overall quality of life for residents, New Delhi continues to have absolutely abysmal air quality—experts at India’s top research hospital have called New Delhi’s air “severe and life-threatening,” and the level of toxic pollutants in the air, from cars and factories and from the crop-waste burning conducted by nearby farmers, can reach 20-times the recommended level for safe breathing.In mid-November 2025, the problem became so bad that the government told half its workers to work from home, because of the dangers represented by the air, and in the hope that doing so would remove some of the cars on the road and, thus, some of the pollution being generated in the area.Trucks spraying mist, using what are called anti-smog guns, along busy roads and pedestrian centers help—the mist keeping some of the pollution from cars from billowing into the air and becoming part of the regional problem, rather than an ultra-localized one, and pushing the pollutants that would otherwise get into people’s lungs down to the ground—though the use of these mist-sprayers has been controversial, as there are accusations that they’re primarily deployed near air-quality monitoring stations, and that those in charge put them there to make it seem like the overall air-quality is lower than it is, manipulating the stats so that their failure to improve practical air-quality isn’t as evident.And in other regional news, just southeast across the Bay of Bengal, the Indonesian government, as of the day I’m recording this, is searching for the hundreds of people who are still missing following a period of unusually heavy rains. These rains have sparked floods and triggered mudslides that have blocked roads, damaged bridges, and forced the evacuation of entire villages. More than 300,000 people have been evacuated as of last weekend, and more rain is forecast for the coming days.The death toll of this round of heavy rainfall—the heaviest in the region in years—has already surpassed 440 people in Indonesia, with another 160 and 90 in Thailand and Vietnam, respectively, being reported by those countries’ governments, from the same weather system.In Thailand, more than two million people were displaced by flooding, and the government had to deploy military assets, including helicopters launched from an aircraft carrier, to help rescue people from the roofs of buildings across nine provinces.In neighboring Malaysia, tens of thousands of people were forced into shelters as the same storm system barreled through, and Sri Lanka was hit with a cyclone that left at least 193 dead and more than 200 missing, marking one of the country’s worst weather disasters in recent years.What I’d like to talk about today is the climatic moment we’re at, as weather patterns change and in many cases, amplify, and how these sorts of extreme disasters are also causing untold, less reported upon but perhaps even more vital, for future policy shifts, at least, economic impacts.—The UN Conference of the Parties, or COP meetings, are high-level climate change conferences that have typically been attended by representatives from most governments each year, and where these representatives angle for various climate-related rules and policies, while also bragging about individual nations’ climate-related accomplishments.In recent years, such policies have been less ambitious than in previous ones, in part because the initial surge of interest in preventing a 1.5 degrees C increase in average global temperatures is almost certainly no longer an option; climate models were somewhat accurate, but as with many things climate-related, seem to have actually been a little too optimistic—things got worse faster than anticipated, and now the general consensus is that we’ll continue to shoot past 1.5 degrees C over the baseline level semi-regularly, and within a few years or a decade, that’ll become our new normal.The ambition of the 2015 Paris Agreement is thus no longer an option. We don’t yet have a new, generally acceptable—by all those governments and their respective interests—rallying cry, and one of the world’s biggest emitters, the United States, is more or less absent at new climate-related meetings, except to periodically show up and lobby for lower renewables goals and an increase in subsidies for and policies that favor the fossil fuel industry.The increase in both number and potency of climate-influenced natural disasters is partly the result of this failure to act, and act forcefully and rapidly enough, by governments and by all the emitting industries they’re meant to regulate.The cost of such disasters is skyrocketing—there are expected to be around $145 billion in insured losses, alone, in 2025, which is 6% higher than in 2024—and their human impact is booming as well, including deaths and injuries, but also the number of people being displaced, in some cases permanently, by these disasters.But none of that seems to move the needle much in some areas, in the face of entrenched interests, like the aforementioned fossil fuel industry, and the seeming inability of politicians in some nations to think and act beyond the needs of their next election cycle.That said, progress is still being made on many of these issues; it’s just slower than it needs to be to reach previously set goals, like that now-defunct 1.5 degrees C ceiling.Most nations, beyond petro-states like Russia and those with fossil fuel industry-captured governments like the current US administration, have been deploying renewables, especially solar panels, at extraordinary rates. This is primarily the result of China’s breakneck deployment of solar, which has offset a lot of energy growth that would have otherwise come from dirty sources like coal in the country, and which has led to a booming overproduction of panels that’s allowed them to sell said panels cheap, overseas.Consequently, many nations, like Pakistan and a growing number of countries across Sub-Saharan African, have been buying as many cheap panels as they can afford and bypassing otherwise dirty and unreliable energy grids, creating arrays of microgrids, instead.Despite those notable absences, then, solar energy infrastructure installations have been increasing at staggering rates, and the first half of 2025 has seen the highest rate of capacity additions, yet—though China is still installing twice as much solar as the rest of the world, combined, at this point. Which is still valuable, as they still have a lot of dirty energy generation to offset as their energy needs increase, but more widely disseminated growth is generally seen to be better in the long-term—so the expansion into other parts of the world is arguably the bigger win, here.The economics of renewables may, at some point, convince even the skeptics and those who are politically opposed to the concept of renewables, rather than practically opposed to them, that it’s time to change teams. Already, conservative parts of the US, like Texas, are becoming renewables boom-towns, quietly deploying wind and solar because they’re often the best, cheapest, most resilient options, even as their politicians rail against them in public and vote for more fossil fuel subsidies.And it may be economics that eventually serve as the next nudge, or forceful shove on this movement toward renewables, as we’re reaching a point at which real estate and the global construction industry, not to mention the larger financial system that underpins them and pretty much all other large-scale economic activities, are being not just impacted, but rattled at their roots, by climate change.In early November 2025, real estate listing company Zillow, the biggest such company in the US, stopped showing extreme weather risks for more than a million home sale listings on its site.It started showing these risk ratings in 2024, using data from a risk-modeling company called First Street, and the idea was to give potential buyers a sense of how at-risk a property they were considering buying might be when it comes to wildfires, floods, poor air quality, and other climate and pollution-related issues.Real estate agents hated these ratings, though, in part because there was no way to protest and change them, but also because, well, they might have an expensive coastal property listed that now showed potential buyers it was flood prone, if not today, in a couple of years. It might also show a beautiful mountain property that’s uninsurable because of the risk of wildfire damage.A good heuristic for understanding the impact of global climate change is not to think in terms of warming, though that’s often part of it, but rather thinking in terms of more radical temperature and weather swings.That means areas that were previously at little or no risk of flooding might suddenly be very at risk of absolutely devastating floods. And the same is true of storms, wildfires, and heat so intense people die just from being outside for an hour, and in which components of one’s house might fry or melt.This move by Zillow, the appearance and removal of these risk scores, happened at the same time global insurers are warning that they may have to pull out of more areas, because it’s simply no longer possible for them to do business in places where these sorts devastating weather events are happening so regularly, but often unpredictably, and with such in

This week we talk about radioactive waste, neutrons, and burn while breeding cycles.We also discuss dry casks, radioactive decay, and uranium.Recommended Book: Breakneck by Dan WangTranscriptRadioactive waste, often called nuclear waste, typically falls into one of three categories: low-level waste that contains a small amount of radioactivity that will last a very short time—this is stuff like clothes or tools or rags that have been contaminated—intermediate-level waste, which has been contaminated enough that it requires shielding, and high-level waste, which is very radioactive material that creates a bunch of heat because of all the radioactive decay, so it requires both shield and cooling.Some types of radioactive waste, particularly spent fuel of the kind used in nuclear power plants, can be reprocessed, which means separating it into other types of useful products, including another type of mixed nuclear fuel that can be used in lieu of uranium, though generally not economically unless uranium supplies are low. About a third of all spent nuclear fuel has already been reprocessed in some way.About 4% of even the recyclable stuff, though, doesn’t have that kind of second-life purpose, and that, combined with the medium- and long-lived waste that is quite dangerous to have just sitting around, has to be stored somehow, shielded and maybe cooled, and in some cases for a very long time: some especially long-lived fission products have half-lives that stretch into the hundreds of thousands or millions of years, which means they will be radioactive deep into the future, many times longer than humans have existed as a species.According to the International Atomic Energy Agency, something like 490,000 metric tons of radioactive spent fuel is currently being stored, on a temporary basis, at hundreds of specialized sites around the world. The majority of this radioactive waste is stored in pools of spent fuel water, cooled in that water somewhere near the nuclear reactors where the waste originated. Other waste has been relocated into what’re called dry casks, which are big, barrel-like containers made of several layers of steel, concrete, and other materials, which surround a canister that holds the waste, and the canister is itself surrounded by inert gas. These casks hold and cool waste using natural air convection, so they don’t require any kind of external power or water sources, while other solutions, including storage in water, sometimes does—and often the fuel is initially stored in pools, and is then moved to casks for longer-term storage.Most of the radioactive waste produced today comes in the form of spend fuel from nuclear reactors, which are typically small ceramic pellets made of low-enriched uranium oxide. These pellets are stacked on top of each other and encased in metal, and that creates what’s called a fuel rod.In the US, alone, about 2,000 metric tons of spent nuclear fuel is created each year, which is just shy of half an olympic sized swimming pool in terms of volume, and in many countries, the non-reuseable stuff is eventually buried, near the surface for the low- to intermediate-level waste, and deeper for high-level waste—deeper, in this context, meaning something like 200-1000 m, which is about 650-3300 feet, beneath the surface.The goal of such burying is to prevent potential leakage that might impact life on the surface, while also taking advantage of the inherent stability and cooler nature of underground spaces which are chosen for their isolation, natural barriers, and water impermeability, and which are also often reinforced with human-made supports and security, blocking everything off and protecting the surrounding area so nothing will access these spaces far into the future, and so that they won’t be broken open by future glaciation or other large-scale impacts, either.What I’d like to talk about today is another potential use and way of dealing with this type of waste, and why a recent, related development in China is being heralded as such a big deal.—An experimental nuclear reactor was built in the Gobi Desert by the Chinese Academy of Sciences Shanghai Institute of Applied Physics, and back in 2023 the group achieved its first criticality, got started up, basically, and it has been generating heat through nuclear fission ever since.What that means is that the nuclear reactor did what a nuclear reactor is supposed to do. Most such reactors exist to generate heat, which then creates steam and spins turbines, which generates electricity.What’s special about this reactor, though, is that it is a thorium molten salt reactor, which means it uses thorium instead of uranium as a fuel source, and the thorium is processed into uranium as part of the energy-making process, because thorium only contains trace amounts of fissile material, which isn’t enough to get a power-generating, nuclear chain reaction going.This reactor was able to successfully perform what’s called in-core thorium-to-uranium conversion, which allows the operators to use thorium as fuel, and have that thorium converted into uranium, which is sufficiently fissile to produce nuclear power, inside the core of the reactor. This is an incredibly fiddly process, and requires that the thorium-232 used as fuel absorb a neutron, which turns it into thorium-233. Thorium-233 then decays into protactinium-233, and that, in turn, decays into uranium-233—the fuel that powers the reactor.One innovation here is that this entire process happens inside the reactor, rather than occurring externally, which would require a bunch of supplementary infrastructure to handle fuel fabrication, increasing the amount of space and cost associated with the reactor.Those neutrons required to start the thorium conversion process are provided by small amounts of more fissile material, like enriched uranium-235 or plutonium-239, and the thorium is dissolved in a fluoride salt and becomes a molten mixture that allows it to absorb that necessary neutron, and go through that multi-step decay process, turning into uranium-233. That end-point uranium then releases energy through nuclear fission, and this initiates what’s called a burn while breeding cycle, which means it goes on to produce its own neutrons moving forward, which obviates the need for those other, far more fissile materials that were used to start the chain reaction. All of which makes this process a lot more fuel efficient than other options, dramatically reduces the amount of radioactive waste produced, and allows reactors that use it to operate a lot longer without needing to refuel, which also extends a reactor’s functional life.On that last point, many typical nuclear power plants built over the past handful of decades use pressurized water reactors which have to be periodically shut down so operators can replace spent fuel rods. This new method instead allows the fissile materials to continuously circulate, enabling on-the-fly refueling—so no shut-down, no interruption of operations necessary.This method also requires zero water, which could allow these reactors to be built in more and different locations, as conventional nuclear power plants have typically been built near large water sources, like oceans, because of their cooling needs.China initiated the program that led to the development of this experimental reactor back in 2011, in part because it has vast thorium reserves it wanted to tap in its pursuit of energy independence, and in part because this approach to nuclear energy should, in theory at least, allow plant operators to use existing, spent fuel rods as part of its process, which could be very economically interesting, as they could use the waste from their existing plants to help fuel these new plants, but also take such waste off other governments’ hands, maybe even be paid for it, because those other governments would then no longer need to store the stuff, and China could use it as cheap fuel; win win.Thinking further along, though, maybe the real killer application of this technology is that it allows for the dispersion of nuclear energy without the risk of nuclear weapons proliferation. The plants are smaller, they have a passive safety system that disallows the sorts of disasters that we saw in Chernobyl and Three-Mile Island—that sort of thing just can’t happen with this setup—and the fissile materials, aside from those starter materials used to get the initial cycle going, can’t be used to make nuclear weapons.Right now, there’s a fair amount of uranium on the market, but just like oil, that availability is cyclical and controlled by relatively few governments. In the future, that resource could become more scarce, and this reactor setup may become even more valuable as a result, because thorium is a lot cheaper and more abundant, and it’s less tightly controlled because it’s useless from a nuclear weapons standpoint.This is only the very first step on the way toward a potentially thorium-reactor dominated nuclear power industry, and the conversion rate on this experimental model was meager.That said, it is a big step in the right direction, and a solid proof-of-concept, showing that this type of reactor has promise and would probably work scaled-up, as well, and that means the 100MW demonstration reactor China is also building in the Gobi, hoping to prove the concept’s full value by 2035, stands a pretty decent chance of having a good showing.Show Noteshttps://www.deepisolation.com/about-nuclear-waste/where-is-nuclear-waste-nowhttps://www.energy.gov/ne/articles/5-fast-facts-about-spent-nuclear-fuelhttps://www.energy.gov/ne/articles/3-advanced-reactor-systems-watch-2030https://world-nuclear.org/information-library/nuclear-fuel-cycle/nuclear-waste/radioactive-wastes-myths-and-realitieshttps://www.visualcapitalist.com/visualizing-all-the-nuclear-waste-in-the-world/https://en.wikipedia.org/wiki/High-level_radioactive_waste_managementhttps://en.wikipedia.org/wiki/

This week we talk about Venezuela, casus belli, and drug smuggling.We also discuss oil reserves, Maduro, and Machado.Recommended Book: Dungeon Crawler Carl by Matt DinnimanTranscriptVenezuela, which suffered all sorts of political and economic crises under former president Hugo Chávez, has suffered even more of the same, and on a more dramatic scale, under Chávez’s successor, Nicolás Maduro.Both Chávez and Maduro have ruled over autocratic regimes, turning ostensibly democratic Venezuelan governments into governments ruled by a single person, and those they like and empower and reward, over time removing anyone from power who might challenge them, and collapsing all checks and balances within the structure of their government.They still hold elections, then, but like in Russia, the voting is just for show, the outcome predetermined, and anyone who gets too popular and who isn’t favored by the existing regime is jailed or killed or otherwise neutralized; the votes are then adjusted when necessary to make it look like the regime is still popular, and anyone who challenges that seeming popularity is likewise taken care of.As a result of that state of affairs, an unpopular regime with absolute power running things into the ground over the course of two autocrats’ administrations, Venezuela has suffered immense hyperinflation, high levels of crime and widespread disease, ever-increasing mortality rates, and even starvation, as fundamentals like food periodically become scarce. This has led to a swell of emigration out of the country, which has, during the past decade, become the largest ever recorded refugee crisis in the Americas, those who leave mostly flooding into neighboring countries like Colombia, Peru, and Ecuador.As of 2025, it’s estimated that nearly 8 million people, more than 20% of Venezuela’s entire population as of 2017, has fled the country to get away from the government, its policies, its collapsed economy, and the cultural homogeny that has led to so much crime, conflict, and oppression of those not favored by the people in charge.This has also led to some Venezuelans trying to get into the US, which was part of the justification for a proposed invasion of the country, by the US government, under the first Trump administration in 2017.The idea was that this is a corrupt, weak government that also happens to possess the largest proven oil reserves in the world. Its production of oil has collapsed along with everything else, in part because the government is so ineffectual, and in part because of outside forces, like longstanding sanctions by the US, which makes selling and profiting from said oil on the global market difficult.Apparently, though, Trump also just liked the idea of invading Venezuela through US ally Colombia, saying—according to Trump’s National Security advisor at the time, John Bolton—that Venezuela is really part of the US, so it would be “cool” for the US to take it. Trump also later said, in 2023, that when he left office Venezuela was about to collapse, and that he would have taken it over if he had been reelected instead of losing to Joe Biden, and the US would have then kept all the country’s oil.So there’s long been a seeming desire by Trump to invade Venezuela, partly on vibe grounds, the state being weak and why shouldn’t we own it, that kind of thing? But underlying that is the notion of the US being a country that can stomp into weaker countries, take their oil, and then nation-build, similar to what the government seemed to be trying to do when it invaded Iraq in the early 2000s, using 9/11 as a casus belli, an excuse to go to war, with an uninvolved nation that happened to own a bunch of oil resources the US government wanted for itself.What I’d like to talk about today is the seeming resurgence of that narrative, but this time with an, actual tangible reason to believe an invasion of Venezuela might occur sometime soon.—As I mentioned, though previously kind of a success story in South America, bringing people in from all over the continent and the world, Venezuela has substantially weakened under its two recent autocratic leaders, who have rebuilt everything in their image, and made corruption and self-serving the main driver behind their decisions for the direction of the country.A very popular candidate, María Corina Machado, was barred from participating in the country’s 2024 election, the country’s Supreme Court ruling that a 15-year ban on her holding public office because of her involvement with an alleged plot against Maduro with a previous candidate for office, Juan Guaido; Guiado is now in exile, run out of the country for winning an election against Maduro, which Maduro’s government has claimed wasn’t legit, but which dozens of governments recognize as having been legitimate, despite Maduro’s clinging to power after losing.So Machado is accused of being corrupt by Maduro’s corrupt government, and thus isn’t allowed to run for office. Another candidate that she wanted to have run in her place was also declared ineligible by Maduro’s people, so another sub was found, Edmundo González, and basically every outside election watchdog group says that he won in 2024, and handedly, over Maduro. But the government’s official results say that’s not the case, that Maduro won, and that has created even more conflict and chaos in the country as it’s become clearer and clearer that there’s no way to oust the autocrat in control of the government—not through the voting box, at least.This is part of what makes Venezuela an even more appealing target, for the Trump administration, right now, because not only is Maduro incredibly unpopular and running the country into the ground, there’s also a very popular alternative, in the shape of María Corina Machado, who could conceivably take control of things should Maduro be toppled. So there’s a nonzero chance that if someone, like the US military, were to step in and either kill Maduro or run him out of town, they could make a very sweet deal with the incoming Machado government, including a deal that grants access to all that currently underutilized oil wealth.This is theoretical right now, but recent moves by the US government and military suggest it might not remain theoretical for much longer.In mid-November, 2025, the US Navy moved the USS Gerald R. Ford Carrier Strike Group to the Caribbean—the USS Gerald R Ford being an aircraft carrier, and the strike group being the array of ships and aircraft that accompany it—it was moved there from the Eastern Mediterranean, where it was moved following the attack on Israel that led to Israel’s invasion of the Gaza Strip.This, by itself, doesn’t necessarily mean anything; the shifting of aircraft carrier groups is often more symbolic than practical. But the US government has suggested it might us these vessels and aircraft to strike drug manufacturers across South and Central America, and specifically in Venezuela.This is being seen as an escalation of an already fraught moment in the region, because the US has launched a series of strikes against small boats in the area, beginning back in September of 2025.These boats, according to the US government, are drug smuggling vessels, bringing fentanyl, among other drugs, to US shores. So the idea is that the people aboard these boats are criminals who are killing folks in the US by bringing this drug, which is highly addictive and super potent, and thus more likely to kill its users than other opioids, into the country for illegal sale and distribution. So, the claim goes, this is a justified use of force.These strikes have thus far, over the past two months, killed at least 79 people, all alleged by the US government to be drug smugglers, despite some evidence to the contrary, in some cases. The US’s allies have not been happy about these strikes, including allies the government usually relies on to help with drug-related detection and interdiction efforts, including regional governments that take action to keep drugs from shuffling around the region and eventually ending up in the US.Many US allies have also called the strikes illegal. The French foreign minister recently said they violate international law, and the EU’s foreign policy chief said something similar, indicating that such use of force is only valid in cases of self-defense, and when there’s a UN Security council resolution on the matter.Canadian and Dutch governments have been doing what they can to distance themselves from the strikes, without outright criticizing the at times vindictive US government, and some regional allies, like Colombia, have been signaling that they’ll be less cooperative with the US when it comes to drug-related issues, saying that they would no longer share intelligence with the US until they stop the strikes, which they’ve called “extrajudicial executions.”An extrajudicial killing is one that is not lawful; it doesn’t have the backing of a judicial proceeding, and thus lacks the authority typically granted by the proper facets of a government. Lacking such authority, killing is illegal. Given said authority, though, a killing can be made legal, at least according to the laws of the government doing the killing.The argument here is that while governments can usually get away with killing people, only authoritarian regimes typically and regularly to use that power to kill folks without going through the proper channels and thus getting the legal authority to do so.In this case, the facts seem to support the accusations of those who are saying these killings aren’t legally legitimate: the Trump administration has launched these attacks on these vessels without going through the usual channels, and without declaring Congressionally approved war on anyone in particular. They’ve instead claimed that drug cartels are terrorists, and have said that anyone they suspect of smuggling drugs, or who they suspect in any way might be involved with the illegal d

This week we talk about OxyContin, opium, and the British East India Company.We also discuss isotonitazene, fentanyl, and Perdue.Recommended Book: The Thinking Machine by Stephen WittTranscriptOpioids have been used as painkillers by humans since at least the Neolithic period; there’s evidence that people living in the Iberian and Italian Peninsulas kept opium poppy seeds with them, and there’s even more evidence that the Ancient Greeks were big fans of opium, using it to treat pain and as a sleep aid.Opium was the only available opioid for most of human history, and it was almost always considered to be a net-positive, despite its downsides. It was incorporated into a mixture called laudanum, which was a blend of opium and alcohol, in the 17th century, and that helped it spread globally as Europeans spread globally, though it was also in use locally, elsewhere, especially in regions where the opium poppy grew naturally.In India, for instance, opium was grown and often used for its painkilling properties, but when the British East India Company took over, they decided to double-down on the substance as a product they could monopolize and grow into a globe-spanning enterprise.They went to great lengths to expand production and prevent the rise of potential competitors, in India and elsewhere, and they created new markets for opium in China by forcing the product onto Chinese markets, initially via smuggling, and then eventually, after fighting a series of wars focused on whether or not the British should be allowed to sell opium on the Chinese market, the British defeated the Chinese. And among other severely unbalanced new treaties, including the ceding of the Kowloon peninsula to the British as part of Hong Kong, which they controlled as a trading port, and the legalization of Christians coming into the country, proselytizing, and owning property, the Chinese were forced to accept the opium trade. This led to generations of addicts, even more so than before, when opium was available only illicitly, and it became a major bone of contention between the two countries, and informed China’s relationship with the world in general, especially other Europeans and the US, moving forward.A little bit later, in the early 1800s, a German pharmacist was able to isolate a substance called morphine from opium. He published a paper on this process in 1817, and in addition to this being the first alkaloid, the first organic compound of this kind to be isolated from a medicinal plant, which was a milestone in the development of modern drug discovery, it also marked the arrival of a new seeming wonder drug, that could ease pain, but also help control cold-related symptoms like coughing and gut issues, like diarrhea. Like many such substances back in the day, it was also often used to treat women who were demonstrating ‘nervous character,’ which was code for ‘behaving in ways men didn’t like or understand.’Initially, it was thought that, unlike with opium, morphine wasn’t addictive. And this thinking was premised on the novel application method often used for morphine, the hypermedia needle, which arrived a half-century after that early 1800s isolation of morphine from opium, but which became a major driver of the new drug’s success and utility. Such drugs, derived scientifically rather than just processing a plant, could be administered at specific, controllable doses. So surely, it was thought, this would alleviate those pesky addictive symptoms that many people experienced when using opioids in a more natural, less science-y way.That, of course, turned out not to be the case. But it didn’t stop the progression of this drug type, and the further development of more derivations of it, including powerful synthetic opioids, which first hit the scene in the mid-20th century.What I’d like to talk about today is the recent wave of opioid addictions, especially but not exclusively in the US, and the newest concern in this space, which is massively more powerful than anything that’s come before.—As I mentioned, there have been surges in opioid use, latent and externally forced, throughout modern human history.The Chinese saw an intense wave of opioid addiction after the British forced opium onto their markets, to the point that there was a commonly held belief that the British were trying to overthrow and enslave the Chinese by weighing them down with so many addicts who were incapable of doing much of anything; which, while not backed by the documentation we have from the era—it seems like they were just chasing profits—is not impossible, given what the Brits were up to around the world at that point in history.That said, there was a huge influx in opioid use in the late-1980s, when a US-based company called Purdue Pharma began producing and pushing a time-released opioid medication, which really hit the big-time in 1995, when they released a version of the drug called OxyContin.OxyContin flooded the market, in part because it promised to help prevent addiction and accidental overdose, and in part because Purdue was just really, really good at marketing it; among other questionable and outright illegal things it did as part of that marketing push, it gave kickbacks to doctors who prescribed it, and some doctors did so, a lot, even when patients didn’t need it, or were clearly becoming addicted.By the early 2000s, Purdue, and the Sackler family that owned the company, was spending hundreds of millions of dollars a year to push this drug, and they were making billions a year in sales.Eventually the nature of Purdue’s efforts came to light, there were a bunch of trials and other legal hearings, some investigative journalists exposed Purdue’s foreknowledge of their drug’s flaws, and there was a big government investigation and some major lawsuits that caused the collapse of the company in 2019—though they rebranded in 2021, becoming Knoa Pharma.All of which is interesting because much like the forced legalization of opium on Chinese markets led to their opioid crisis a long time ago, the arrival of this incredibly, artificially popular drug on the US market led to the US’s opioid crisis.The current bogeyman in the world of opioids—and I say current because this is a fast-moving space, with new, increasingly powerful or in some cases just a lot cheaper drugs arriving on the scene all the time—is fentanyl, which is a synthetic opioid that’s about 30-50 times more potent than heroin, and about 100 times as potent as morphine. It has been traditionally used in the treatment of cancer patients and as a sedative, and because of how powerful it is, a very small amount serves to achieve the desired, painkilling effect.But just like other opioids, its administration can lead to addiction, people who use it can become dependent and need more and more of it to get the same effects, and people who have too much of it can experience adverse effects, including, eventually, death.This drug has been in use since the 1960s, but illicit use of fentanyl began back in the mid-1970s, initially as its own thing, but eventually to be mixed in with other drugs, like heroin, especially low-quality versions of those drugs, because a very small amount of fentanyl can have an incredibly large and potent effect, making those other drugs seem higher quality than they are.That utility is also this drug’s major issue, though: it’s so potent that a small amount of it can kill, and even people with high opioid tolerances can see those tolerances pushed up and up and up until they eventually take a too-large, killing dose.There have been numerous efforts to control the flow of fentanyl into the US, and beginning in the mid-20-teens, there were high-profile seizures of the illicitly produced stuff around the country. As of mid-2025, China seems to be the primary source of most illicit fentanyl around the world, the drug precursor produced in China, shipped to Mexico where it’s finalized and made ready for market, and then smuggled into the US.There have been efforts to shut down this supply chain, including recent tariffs put on Chinese goods, ostensibly, in part at least, to get China to handle those precursor suppliers.Even if that effort eventually bears fruit, though, India seems to have recently become an alternative source of those precursors for Mexican drug cartels, and for several years they’ve been creating new markets for their output in other countries, like Nigeria, Indonesia, and the Netherlands, as well.Amidst all that, a new synthetic drug, which is 40-times as potent as fentanyl, is starting to arrive in the US, Europe, and Australia, and has already been blamed for thousands of deaths—and it’s thought that that number might be a significant undercount, because of how difficult it can be to attribute cause with these sorts of drugs.Nitazenes were originally synthesized back in the 1950s in Austria, and they were never sold as painkillers because they were known, from the get-go, to be too addictive, and to have a bad tradeoff ratio: a little bit of benefit, but a high likelihood of respiratory depression, which is a common cause of death for opioid addicts, or those who accidentally overdose on an opioid.One nitazene, called isotonitazene, first showed up on US drug enforcement agency radars back in 2019, when a shipment was intercepted in the Midwest. Other agencies noted the same across the US and Europe in subsequent years, and this class of drugs has now become widespread in these areas, and in Australia.It’s thought that nitazenes might be seeing a surge in popularity with illicit drugmakers because their potency can be amped up so far, way, way higher than even fentanyl, and because their effects are similar in many ways to heroin.They can also use them they way they use fentanyl, a tiny bit blended into lower-quality versions of other drugs, like cocaine, which can save money while also getting their customers, who may not know what they’re buying,

This week we talk about Mach 1, the Bell X-1, and the Concorde.We also discuss the X-59, the Tu-144, and Boom Supersonic.Recommended Book: Red Team Blues by Cory DoctorowTranscriptThe term “supersonic,” when applied to speed, refers to something moving faster than the speed of sound—a speed that is shorthanded as Mach 1.The precise Mach 1 speed of sound will be different depending on the nature of the medium through which an object is traveling. So if you’re moving at sea level versus up high in the air, in the stratosphere, the speed of sound will be different. Likewise if you’re moving through moist air versus dry air, or moving through water versus moving through syrup, different speed of sound, different Mach 1.In general, though, to give a basic sense of how fast we’re talking here, if an object is moving at sea level through dry air at a temperature of 20 degrees celsius, which is 68 degrees fahrenheit, Mach 1 is about 768 miles per hour, which is about 1,126 feet per second, and 343.2 meters per second.It’s fast! It’s very fast. Again, this is the speed at which sound moves. So if you surpass the speed of sound, if you go supersonic, you will arrive faster than the sound you make while moving.Back in 1947, an experimental American plane called the Bell X-1 broke the sound barrier, surpassed Mach 1, reaching a speed of almost 1,000 miles per hour using a 6,000 pound thrust rocket propulsion system. A later version of the same rocket-powered plane, the Bell X-1A, which was basically the same vehicle, it just had more fuel capacity, allowing the rocket to burn longer, achieved 1,600 miles per hour in 1956.Prior to that, in 1943, British began working on a secret experimental aircraft called the Miles M.52, intending to build a plane capable of traveling 1,000 mph. Interestingly, this project was apparently the result of the British wanting to keep up with a supposed already existing German aircraft capable of achieving that speed, though it’s now believed the intelligence that led the British to believe the Germans had a supersonic-capable plane was the result of a mistranslation—the Germans hit 1,000 km per hour, which is about 621 mph, and still subsonic.Though apparently a success in terms of research and innovation, the Miles M.52 project was cancelled in 1946, due partly to budgetary concerns, and partly because the new government didn’t believe supersonic aircraft were practical, or maybe even feasible.After the existence of this project was revealed to the public, however, criticism for the cancellation mounted, and the design was translated into new, unmanned scale-model experimental versions of the plane which achieved controlled Mach 1.38 supersonic speeds, and both the design and research from this program was shared with the American company, Bell, and all that knowledge informed the development of the aforementioned Bell X-1 supersonic plane.Again, that successful Bell mission was flown in 1947, and in 1961, a Douglas jetliner, a commercial jet, broke the sound barrier during a controlled test dive, and that fed the development of an intended supersonic airliner in the US, though similar research being conducted elsewhere would bear more direct and immediate fruit.In the Soviet Union, a supersonic jetliner called the Tupolev Tu-144 entered service in 1968, and a jetliner co-developed by the British and French, the Concorde, began construction in 1965, and tallied its first flight in March of 1969.The Tu-144 was thus the world’s first commercial supersonic airliner, by a few months, and it also became the first commercial transport to exceed Mach 2, twice the speed of sound, in 1970.The Tu-144 was plagued by reliability issues from the get-go, however, and while performing maneuvers at an air show in Paris in 1973, it disintegrated in midair, which—combined with its high operating costs reduced its long-term market viability, especially internationally. By the mid-1970s, it was primarily operating within the Soviet Union, and after a new variant of the jet crashed in 1978, the Tu-144 program was cancelled in 1983. Existing models continued to be use for niche purposes, like training space program pilots, and for a supersonic research program undertaken by NASA in the late-1990s, but the final Tu-144 flight was in mid-1999, and all surviving aircraft are now on display or in storage.The Concorde has a similar history. Original forecasts for the supersonic airliner market were optimistic, and while the craft seemed to be generally more reliable and less issue-prone than the Tu-144, and it enjoyed a period of fanfare and promotion, as a sort of luxury experience for folks crossing the Atlantic in particular, cutting travel times in half, a major crash in mid-2000, which killed all 109 occupants and four people on the ground, led to the suspension of service until late-2001, and all remaining Concorde aircraft were retired in 2003—about 20 of them are on display throughout North American and Europe, as of the mid-2020s.The costs associated with operating Concorde aircraft, as with the Tu-144, were also quite high, and those costs and other complications led to the cancellation of a would-be supersonic jetliner competitor from Boeing, the 2707, in 1971, before it built any prototypes.What I’d like to talk about today is a renewed enthusiasm for supersonic passenger aircraft, and what’s changed that might make supersonic transport a viable market, today.—In the United States, commercial aircraft are not allowed to fly at supersonic speeds. This is because the sonic booms generated by supersonic flight, which are shockwaves that work a bit like the crack of a bullwhip or the firing of a bullet, but much, much larger, can set off alarms, rattle or shatter windows, and generally create all sorts of chaos on the ground, even in areas not directly under the aircraft that’s breaking the sound barrier.This was true even during the heyday of the Concorde: the craft was only allowed to travel at supersonic speeds over the ocean, because doing so over populated areas was such a pain, and in some cases, a danger.Sonic booms aren’t the only reason supersonic aircraft like the Concorde failed to establish a long-term presence in the airline industry, but they’re a big part of it. It’s just really difficult to work around that kind of persistent issue.This is why a new experimental project by NASA, the X-59 Quesst, with two-s’s, Quesst standing for Quiet SuperSonic Technology, is garnering so much attention. Built by Lockheed Martin, the X-59 is said to dramatically reduce the scale of sonic booms, instead producing what’s been described as a sonic thump, its long, slender nose breaking up the pressure waves that otherwise build up and create that much larger, more impactful shock wave boom, and its engine is on top of the plane rather than underneath it, a design choice that sends the majority of remaining shock wave impacts upward toward the sky, rather than down toward the ground.The X-59 is still just an experimental jet. It’s a single-seater, it’s about twice as long as an F-16 fighter jet, and it can cruise at around 925 miles per hours, which is Mach 1.4.It’s hoped that this new design will allow for the creation of future supersonic jetliners, though, as being able to traverse oceans twice as fast would bring massive economic benefits, in terms of shipping people, but also all kinds of goods. Being able to use these aircraft fully, at their full speed, over land and to and from any airport, would likewise make them more versatile and introduce new benefits and, hopefully, favorable economics.Worth noting here is that this jet is a descendent of that first Bell X-1 plane that broke the sound barrier in 1947; NASA’s X-planes are innovative models meant to push the boundaries of what’s currently possible, and the X-59 is just a more modern version of that initial X-1 conception in many ways.That said, the X-59 has only been successfully flown at low speeds and altitudes at this point. It got a lot of press at the end of October 2025 for successfully completing its first flight, which shows it can fly and land, which is good. But its inaugural flight stuck with a low altitude and just 240 miles per hour; really slow for a jet, and too low for a commercial airliner.The folks behind this project have also said that while they have every reason to believe this design will both work and create a far less impactful sonic boom, they don’t yet know if that boom will actually be tolerable for people on the ground. Simulating such things is different from the experience of them, and they won’t know until they power the thing all the way up and have it break the sound barrier whether the sonic thump will be barely noticeable and tolerable for folks near airports and flight paths, or if it will be better, but still not good enough to make this a viable alternative to existing jets.There are other entities working on similar things right now, including a company called Boom Supersonic that has already flown a piloted demonstration aircraft, the XB-1, at supersonic speeds—Mac 1.122, which is about 750 mph—at an altitude of over 35,000 feet; the first time a non-government-affiliated aircraft has done so.That was back in March of 2024, and the company plans to build a commercial supersonic aircraft that will carry between 64 and 80 passengers at Mach 1.7, on hundreds of global routes; they say they already have a large number of orders for this passenger aircraft they intend to build, and they say to begin with, they’ll be able to produce 66 of them per year from their factory in North Carolina. They say that they’ll have the first full-scale prototype of that passenger aircraft, called the Overture, in 2027, and they’re aiming to put that craft into service beginning in 2029 or 2030.They’re not the only private company aiming to produce supersonic aircraft for various purposes, either. The promise of moving people and thi

This week we talk about robots, call center workers, and convenience stores.We also discuss investors, chatbots, and job markets.Recommended Book: The Fourth Consort by Edward AshtonTranscriptThough LLM-based generative AI software, like ChatGPT, Gemini, and Claude, are becoming more and more powerful by the month, and offering newfangled functionality seemingly every day, it’s still anything but certain these tools, and the chatbots they power, will take gobs of jobs from human beings.The tale that’s being told by upper-management at a lot of companies makes it seem like this is inevitable, though there would seem to be market incentives for them to both talk and act like this is the case.Companies that make new, splashy investments in AI tech, or which make deals with big AI companies, purporting to further empower their offerings and to “rightsize” their staff as a consequence, tend to see small to moderate bumps in their stock price, and that’s good for the execs and other management in those companies, many of whom own a lot of stock, or have performance incentives related to the price of their stock built into their larger pay package.But often, not always, but quite a lot of the time, the increased effectiveness and efficiencies claimed by these higher-ups after they go on a firing spree and introduce new AI tools, seem to be at least partly, and in some cases mostly attributable to basically just threatening their staff with being fired in a difficult labor market.When Google executives lay off 5 or 10% of their staff on a given team, for instance, and then gently urge those who survived the cull to come to the office more frequently rather than working from home, and tell them that 60 hours a week is the sweet spot for achieving their productivity goals, that will tend to lead to greater outputs—at least for a while. Same as any other industry where blood has been drawn and a threat is made if people don’t live up to a casually stated standard presented by the person drawing that blood.Also worth mentioning here is that many of the people introducing these tools, both into their own companies and into the market as a whole, seem to think most jobs can be done by AI systems, but not theirs. Many executives have outright said that future businesses will have a small number of people managing a bunch of AI bots, and at least a few investors have said that they believe most jobs can be automated, but investing is too specialized and sophisticated, and will likely remain the domain of clever human beings like themselves.All of which gestures at what we’re seeing in labor markets around the globe right now, where demands for new hires are becoming more intense and a whole lot of low-level jobs in particular are disappearing entirely—though in most cases this is not because of AI, or not just, but instead because of automation more broadly; something that AI is contributing to, but something that is also a lot bigger than AI.And that’s what I’d like to talk about today. The rapid-speed deployment, in some industries and countries, at least, of automated systems, of robots, basically, and how this is likely to impact the already ailing labor markets in the places that are seeing the spearpoint of this deployment.—Chatbots are AI tools that are capable of taking input from users and responding with often quite human-sounding text, and increasingly, audio as well.These bots are the bane of some customers who are looking to speak to a human about some unique need or problem, but who are instead forced to run a gauntlet of AI-powered bots. The interaction often happens in the same little chat window through which they’ll eventually, if they say the right magic words, reach a human being capable of actually helping them. And like so many of the AI innovations that have been broadly deployed at this point, this is a solution that’s generally hated by customers, but lauded by the folks who run these companies, because it saves them a lot of money if they can hire fewer human beings to handle support tickets, even if those savings are the result of most people giving up before successfully navigating the AI maze and reaching a human customer support worker.In India right now, the thriving call center industry is seeing early signs of disruption from the same. IT training centers, in particular, are experimenting with using audio-capable AI chatbots instead of human employees, in part because demand is so high, but also, increasingly, because doing so is cheaper than hiring actual human beings to do the same work.One such company, LimeChat, recently said that it plans to cut its employee base by 80% in the near-future, and if that experiment is successful, this could ripple through India’s $283 billion IT sector, which accounts for 7.5% of India’s GDP. Hiring growth in this sector already collapsed in 2024 and 2025, and again, while this shift seems to be pretty good for the balance books of the companies doing less hiring and more firing as they deploy more AI systems, it’s very not good for the often younger people who take these jobs, specializing in call center IT work, only to find that the market no longer demands their skill sets.Along the same lines, but in a perhaps more surprising industry, some convenience stores in Japan are deploying robots to manage their back rooms, where the products that end up available out front are unloaded, tallied, and shelved.These robots, which are basically just arms on poles, sometimes attached to wheeled bases, for moving around, sometimes not, are operated by AI, but are also continuously monitored by human employees in the Philippines. Each worker, who can be paid a lot less than an entry-level, young Japanese person would expect to be paid, monitors about 50 machines at a time, and steps in, using virtual reality gear to control the robots, if one of them gets stuck or drops something; which apparently happens about 4% of the time.This is akin to offshoring of the kind we’ve seen since the early 2000s, when the dawn of technological globalization made China the factory of the world and everything shifted from a model of local production and the stockpiling of components, to a last-minute, supply-chain oriented model that allowed companies to move all their manufacturing and some of their services to wherever it could be done the cheapest.Many people and companies benefitted from this arbitrage to some degree, though many regions have dried up as a result of this shift, because, for instance, former company towns where cars were produced no longer have the resources to keep infrastructure from degrading, and no longer have enough jobs to keep young people from moving away; brain drain can become pretty intense when there’s no economic reason to stay.This reality is expected to become more widespread, even beyond former manufacturing hubs, because of the deployment of both AI systems, which can be subbed-in for many remote jobs, like call center work, programming, and the like, but also because of increasingly sophisticated and capable robots, which can do more automated work, which in turn allows them to be monitored, sometimes remotely, like those Japanese convenience store robots, for a fraction of the price of hiring a human being.This shift is expected to be especially harrowing for teens hoping to enter the labor market in entry-level jobs, as responsibilities like shelf-stocking and product scanning and the loading and unloading of materials are increasingly automatable, as robots capable of doing this work are developed and deployed, and perhaps even more importantly, as systems that augment that automatability are developed and deployed.In practice, that means coming up with shipping processes and other non-tangible systems that lean into the strengths of today’s automated systems, while reducing the impact of their weaknesses.Amazon is in prime position to do exactly this, as they’ve already done so much to rewire global shipping channels so that they can deliver products as rapidly as possible, to as many places as possible. As a result, they control many of the variables within these channels, which in turn means they can tweak them further, so that they’re optimized to work with Amazon’s specialized automated systems, rather than just human ones.The company has stated, in internal documents, that it plans to automate 75% of its total operations, and it currently has nearly 1.2 million employees. That’s triple what it employed in 2018, and it’s expected that the automated systems it has already and will soon deploy will allow it to hire 160,000 fewer people than planned by 2027.Even though the company expects to sell twice as many products by 2033, then, it expects to hire 600,000 fewer people by that same year. And it’s so confident in its ability to make this happen that it’s already making plans to rebuild its image in the aftermath of what’s expected to be a really difficult period of people hating it. It’s planning significant branding efforts, meant to help it seem like a good corporate citizens, including sponsored community events and big donations to children’s programs.It’s also intending to frame this shift as an evolution in which robots are amplifying the efforts of human employees. Rather than calling their automated systems robots, they might call them ‘cobots,’ for instance.Amazon has contended that the internal documents in which these plans were outlined, those documents acquired and reported upon by the New York Times, are incomplete and not an accurate representation of what Amazon plans, and they said those branding efforts are not a response to hate related to their automation efforts, they just like spending money on nice things for communities.The net-impact of existing efforts of this kind, though, is to deplete local job markets where these big companies dominate, and to make the jobs that survive a lot higher-end, requiring more techn

This week we talk about entanglements, monopolies, and illusory money.We also discuss electrification, LLMs, and data centers.Recommended Book: The Extinction of Experience by Christine RosenTranscriptOne of the big claims about artificial intelligence technologies, including but not limited to LLM-based generative AI tech, like ChatGPT, Claude, and Gemini, is that they will serve as universal amplifiers.Electricity is another universal amplifier, in that electrifying systems allows you to get a lot more from pretty much every single thing you do, while also allowing for the creation of entirely new systems.Cooking things in the kitchen? Much easier with electricity. Producing things on an assembly line? The introduction of electricity allows you to introduce all sorts of robotics, measuring tools, and safety measures that would not have otherwise been available, and all of these things make the entire process safer, cheaper, and a heck of a lot more effective and efficient.The prime argument behind many sky-high AI company valuations, then, is that if these things evolve in the way they could evolve, becoming increasingly capable and versatile and cheap, cooking could become even easier, manufacturing could become still faster, cheaper, and safer, and every other aspect of society and the economy would see similar gains.If you’re the people making AI, if you own these tools, or a share of the income derived from them, that’s a potentially huge pot of money: a big return on your investment. People make fortunes off far more focused, less-impactful companies and technologies all the time, and being able to create the next big thing in not just one space, but every space? Every aspect of everything, potentially? That’s like owning a share of electricity, and making money every time anyone uses electricity for anything.Through that lens, the big boom in both use of and investment in AI technologies maybe shouldn’t be so surprising. This represents a potentially generational sea-change in how everything works, what the economy looks like, maybe even how governments are run, militaries fight, and so on. If you can throw money into the mix, why wouldn’t you? And if that’s the case, the billions upon billions of dollars sloshing around in this corner of the tech world make a lot of sense; it may be curious that there’s not even more money being invested.Belief in that promise is not universal, however.A lot of people see these technologies not as the next electricity, but maybe the next smartphone, or perhaps the next SUV.Smartphones changed a whole lot about society too, but they’re hardly the same groundbreaking, omni-powerful upgrade that electricity represents.SUVs, too, flogged sales for flailing car companies, boosting their revenues at a moment in which they desperately needed to sell more vehicles to survive. But they were just another, more popular model of what already came before. There’s a chance AI will be similar to that: better software than came before, for some people’s use-cases—but not revolutionary, not groundbreaking even on the scale of pocketable phone-computers.What I’d like to talk about today are the peculiar economics that seem to be playing a role in the AI boom, and why many analysts and financial experts are eyeballing these economics warily, worrying about what they maybe represent, and possibly portend.—The term ‘exuberance,’ in the context of markets, refers to an excitement among investors—sometimes professional investors, sometimes casual investors, sometimes both—about a particular company, technology, or financial product type.The surge in interest and investment in cryptoassets during the height of the COVID-19 pandemic, for instance, including offshoot products like NFTs, was seemingly caused by a period of exuberance, sparked by the novelty of the product, the riches a few lucky insiders made off these products, and the desire by many people—pros and consumer-grade investors—to get in on that action, at a moment in which there wasn’t as much to do in the world as usual.Likewise, the gobs of money plowed into early internet companies, and the money thrown at companies laying fiberoptic cable for the presumed boom in internet customers, were, in retrospect, at least partly the consequence of irrational exuberance.In some cases these investors were just too early, as was the case with those cable-laying companies—the majority of them going out of business after blowing through a spectacular amount of money in a short period of time, and not finding enough paying customers to fund all that expansion—in others it was the result of sky-high valuations that were based on little beyond the exuberance of investors who probably should have known better, but who couldn’t get past their fear of missing out on the next big thing.In that latter case, that flow of money into early dotcom startups did fund a few winners that survived the eventual bursting of that bubble, but the majority of companies tagged with those massive valuations went out of business in part because their valuations were based in part on optimism, hot air, and illusory financials.Which is to say, their financials were based on a lot of money being added to their account sheets and tallied in the places investors would see those numbers, but the numbers didn’t mean what most people thought they meant.A company could receive tens of millions of dollars in orders, for instance, but that money and those orders might never be received and fulfilled, or that money might be mostly illusory: maybe it was borrowed from another company to spend on advertising, and that money would then go right back out the door, to the company from which it was borrowed, to pay for their ad services.That kind of arrangement could be beneficial, as the company doing the borrowing might give up a relatively small number of shares in exchange for money, which looks good on its balance sheet, especially if the money is given at a high valuation, even if that money was mostly just a loan from a company providing ad services, with the full knowledge that money would then be spent on their own ad services. And the ad company giving the money could usually afford to buy in at a high valuation, because it knows it will get that money right back, and when it does, it will get to record that money as income on its own balance sheets.So Company A gets millions of dollars from Company B, that money is then paid to Company B for some type of service, and both companies get to record favorable figures on their accounting sheets, as if real sales took place and real outside money changed hands, despite it being a circular move, with very little or no actual value being created.These sorts of relationships are also often good for investors in companies that do this sort of thing, because it makes their investments, the companies they’ve bought into, look even more valuable.Check it out, Company A, which I own shares in, is worth more than it was last month because of all the business it’s conducting, and because this other company bought into it at a higher price per share than I paid! Even though that increase in valuation is predicated on circular financing, the numbers still go up, and they go up for everyone involved, so there’s little reason to crack down on this not illegal, but shady behavior, and even less reason to want anyone else to know about it, because then they might not add their own money to the circular money-cycling, number-increasing machine.The major concern amongst some analysts right now is that the AI boom, especially in the United States, might be essentially this kind of circular cycle, but much larger than previous versions of the same.In the US right now, investment in AI infrastructure like data centers accounts for a huge portion of overall growth—the numbers vary, depending on who you ask and what numbers they look at, but some say that about 90% of total US economic growth, and around 80% of US stock market growth, are predicated on these sorts of investments this past year. Without these investments, the US economy would be basically flat, or worse, and the US stock market would be flailing as well.This situation isn’t ideal whatever the specifics, as too much reliance on just one industry, or one small collection of industries dominated by just a handful of companies and their investors, makes for a precarious financial foundation.If anything goes wrong with just one company, the whole house of cards could collapse. And if anything goes wrong with the industry, things could get even worse, and fast. All that investment, all that construction, all those employees and all that money sloshing around could disappear, could stop being spent, could make all those numbers fall and fall and fall more or less overnight.If this industry is in fact in a bubble, and if it’s being propped up by this kind of circular financing, where companies are fluffing up their own and each other’s accounting books by rotating the same bundle of money and on-paper money from company to company to company, that would portend pretty bad things for the US economy and market, if anyone involved stumbles, even just a little.This is why recent deals between the biggest players in this space are raising so many eyebrows, and causing so much sweat to bead on so many foreheads.In September of 2025, ChatGPT-maker OpenAI announced it had formalized a $100 billion investment deal with AI chipmaker Nvidia, the latter expanding on its existing investment in the former. In October, OpenAI announced it was purchasing billions of dollars worth of AI hardware from Nvidia-rival AMD, and that it’s taking a 10% stake in the company.Microsoft is already heavily invested in OpenAI, to the tune of $13 billion; it takes 49% of OpenAI’s profits, and gets more than that until its original investment is paid back. Microsoft also accounted for nearly 20% of Nvidia’s annualized reven

This week we talk about trade wars, TACO theory, and Chinese imports.We also discuss negotiation, protectionism, and threat spirals.Recommended Book: More Than Words by John WarnerTranscriptIn January of 2018, then first-term US President Trump announced a slew of tariffs and trade barriers against several countries, including Canada, Mexico, and those in the European Union.The most significant of these new barriers and tariffs were enacted against China, though, as Trump had long claimed that China, the US’s most important trade partner by many measures, was taking advantage of the US market; a claim that economists tepidly backed, as while some of the specifics, like those related to intellectual property theft on the part of China, were pretty overt, the Chinese government fairly brazenly gobbling up IP and technology from US companies that do business in the country before hobbling those US interests in China and handing that IP and technology off to their own, China-born copies, claims about a trade deficit were less clear-cut—most of those sorts of claims seemed to be the result of a misunderstanding about how international trade works.That said, Trump had made a protectionist stance part of his platform, so he kicked off his administration by imposing a package of targeted tariffs against specific product categories from China, including things like solar panels and washing machines. Those were followed by more tariffs on steel and aluminum—from a lot of countries, not just China—and this implementation of trade barriers between the US and long-time trade partners, which had mostly enjoyed barrier-free trade up till that point, kicked off a trade war, with the Trump administration announcing, out of nowhere, new tariffs or limitations, and the country on the pointy end of that new declaration announcing their own counter, usually something the US sells to their country, while in the background, both countries tried to negotiate new trade terms on the down-low.There was a lot of tit-for-tatting in those first couple years of the first Trump administration, and they led to a lot of negotiations between the US government and these foreign governments, which in turn led to the lifting of many such barriers, though the weaponization of barriers continued, with the administration, for instance, announcing a tariff on all imports from Mexico until the Mexican government was able to halt all illegal immigration coming into the US; negotiation ended that threat, too, but this early salvo upset a lot of the US’s long-time allies, while also making it clear that Trump intended to open negotiations with these sorts of threats, whenever possible—which had the knock-on effect of everyone taking the threats pretty seriously, as they were often incredibly dangerous to specific industries, while also taking them less seriously because it was obvious they were intended to be a negotiating tactic.When Trump left office, a bunch of international relationships had been scarred by this approach to trade deals, and when Biden replaced him, he dropped most of the new tariffs against long-time allies, but kept most of the China tariffs in place, especially those related to green technologies like electric vehicles and semiconductors, the local-made versions of which were becoming a big focus for the Biden administration. The administration then went on to expand upon those tariffs, against China, in some cases.What I’d like to talk about today is how this approach to trade protectionism and negotiation has ballooned under the second Trump administration, and what a new threat against China by Trump might mean for how the relationship between these two countries evolves, moving forward.—Trump’s second administration opened with an executive order that declared a national emergency, claiming that the Chinese were trafficking drugs, especially synthetic opioids like fentanyl, into the US, and that this allowed criminals to profit from destroying the lives of US citizens.This declaration allowed him to unleash a flurry of tariffs against China, first imposing 10% on all Chinese imports, then increasing that to 20% in March of 2025.China retaliated, imposing tariffs of 15% on mostly US energy products, like coal and natural gas, and on some types of agricultural machines, while also engaging in some legal pressure against US companies, like Google. They followed this up with tariffs against meat and dairy products, and suspended US lumber import rights, and disallowed three US firms from selling soybeans to China.The US reciprocated, and China reciprocated back. There was a period of spiraling broad tariffs and import bans in the mid-2025 between the US and China, which led to an aggregate baseline tariff on Chinese imports of 104%, which was followed with an aggregate Chinese baseline tariff against US goods of 84%. The US then upped theirs to 145%, and China raised theirs to 125%.Again, vital to understanding this spiral is that the Trump administration made pretty clear that they were doing this mostly as a negotiating tactic. There were claims that they could solve the US deficit by raising tariffs so high that the funds from those tariffs would pay off the country’s debt, but that’s generally not considered to be realistic. Instead, the consensus view is that Trump likes to play negotiating hardball, likes to step into negotiations with the upper-hand, being able to say, give me what I want and I’ll reduce the pain you’re experiencing, basically, and this play against China was another attempt to make that kind of advantage stick.China, for its part, seemed like it was done with the posturing at that point, though: it announced, after its retaliatory tariffs reached 125%, that it would simply ignore all further increases on the US government’s side, because the whole thing is just kind of a joke and it’s beneath them to keep playing this game.Not long after that, Trump announced that the tariffs against China would come down substantially, but not to zero; Trump said this was decided after discussions with China, and Chinese officials said they hadn’t been in contact with the Trump administration about any of this—which is something that seems to happen quite a bit with the Trump administration.During this period of spiraling trade barriers, China was able to establish better and more open trade agreements with other nations in Southeast Asia, including South Korea and Japan. China also reduced it US Treasury holdings, reducing its exposure to the US economy at a moment in which the US government was betting big on policy that many economists considered to be ham-handed at best, completely nonsensical, delusional, and harmful at worst.During that spiral, before things cooled off, China also began applying protections on locally sourced and refined rare earths, which are a category of mineral that are vital for modern electronics and things like solar panels, batteries, semiconductors, and electric vehicles.China makes and owns the rights to the vast majority of the current global supply of these materials, mining about 70% of them and controlling about 90% of global processing. And cutting them off, or even truncating their flow, is considered to be a huge strategic threat. The US has been slowly investing in alternative supplies for such things, but many of them are difficult or expensive to produce in the proper volume, and it’ll likely be a decade or more before those alternative sources can be properly exploited, replacing the volume currently imported from China.Back in June, China granted permits to US businesses that would be allowed to import rare earths, but that supply remained tenuous—a bit of a counter to Trump’s ongoing tariff threats that could seemingly arise out of nowhere, messing up everyone’s plans. The Chinese seemed to want to leverage this supply in the same way, and keeping things limited while issuing a few permits meant the flow could kind of continue, but could also be slowed or cut off, again, at a moment’s notice.In early October, the Chinese government announced new curbs on the export of rare earths and related technologies, just three weeks before a scheduled meeting between Trump and Chinese leader Xi Jinping. These new curbs further limited what could be imported to the US, even if there were intermediary nations involved, and also tightened their grip on anything related to mining, smelting, recycling, and producing products, like powerful magnets, from such materials.It’s worth mentioning here, too, that these sorts of materials are increasingly vital for the production of high-tech military goods. If the US were to lose access to sufficient volumes of them, the US military would have a very hard time making missiles, replacing satellite components, building tanks and drones—it would give China a significant advantage, probably for years, in terms of upgrading and maintaining their military hardware.Despite that, and despite the US government’s claims that it intended to replace Chinese sources of these materials, theoretically limiting Chinese leverage in these upcoming talks, progress in that department has been minimal, so far; about a billion dollars worth of investment in rare earths supply chains were announced over the past year or so, but further investment is considered to be unlikely in the near-future, and it’ll be a while before these investments will pay off, if they ever do.Shortly after that announcement by the Chinese, President Trump threatened to enforce a new 100% tariff on Chinese imports, beginning on November 1, or potentially even sooner, raising tariff levels to just shy of what they were back in April of 2025, at the peak of the US-China trade protectionism threat-spiral.He also said he didn’t see any reason to meet with Xi if they were going to limit rare earths in this way, but later clarified that the meeting hadn’t been cancelled, and said that he set the implemen

This week we talk about Electronic Arts, 3DO, and the Saudi Arabian Public Investment Fund.We also discuss Jared Kushner, leveraged buyouts, and loot boxes.Recommended Book: Bandwidth by Dan CarusoTranscriptElectronic Arts, often shorthanded as EA, was founded in 1982 in California by a former Apple employee named Trip Hawkins, who also went on to found the ill-fated 3DO company, which made video game hardware, and the somewhat more prolific, but also ultimately ill-fated casual game developer Digital Chocolate.EA, though, has been an absolutely astounding success. It’s business model was predicated on the premise of selling video games directly to retailers, rather than going through intermediaries. This allowed them to gain more market share than their competitors right off the bat, and it helped them glean higher margins than their competitors from each direct sale, too.EA also established an early reputation for treating its developers really well. They were the first gaming company to feature their developers in advertising and to give them platforms, promoting them as video game artists, basically, and it shared the profits netted from those direct sales with these develops—which in turn meant all the best developers really wanted to work for EA, which led to a beneficial cycle where they created better and better, and more and more financially successful games.In the late-80s, they started deviating from this model somewhat, scooping up a collection of successful independent game development studios and deviating, at times, from the creative lead’s vision when releasing their games. They also refocused a fair bit of their resources on franchises, like the immensely successful, as it turned out, Madden NFL series, and they branched out into producing games for the console market, including the still-new Nintendo Entertainment System, in 1990.That same year, EA went public on the NASDAQ, the company got new leadership when Hawkins decided to refocus on his far less successful 3DO hardware startup, and in an interesting twist, the arrival of the Sony Playstation in North America caused EA to drop support for 3DO hardware in the mid-90s so it could refocus on Playstation games, which were a lot more lucrative.By the mid-90s, EA had an astonishingly large and successful software library, including franchises like the aforementioned Madden games and the FIFA soccer games, but also celebrity-tied games like Shaq Fu, and military shooters like Jungle and Urban Strike.By the early-2000s, EA was making exclusive licensing deals with the NFL and ESPN, in order to stave off newfound sports game competitors, and it was the only video game company to consistently make a profit, most others experiencing feast and famine cycles, with periodic wins, but a whole lot of losses they had to cover with the profits from those wins. EA, in contrast, had a reliable stable of profit-sources, and it thus had a whole lot of leverage in terms of attracting and retaining talent, but also getting big names and brands on board, for collaborative projects.What I’d like to talk about today is what happened to EA during and following the 2008 economic crisis, and how and why it recently became an acquisition target for Saudi Arabia.—In 2008, when the global economy was collapsing, EA suffered a bad holiday sales season and fired 1,100 employees and closed 12 of their facilities early the following year. Later in 2009, the company announced the firing of another 1,500 employees, which was about 17% of their total workforce at the time, and in 2010 they acquired a gaming company that focused on mobile games, which were becoming increasingly popular, now that many people had touch-capable smartphones, which brought hot new franchises like Angry Birds under their brand umbrella.On the strength of that acquisition and all those downsizings, in early 2011, EA announced that it hit $3.8 billion in revenue in the financial year for the first time, and in early 2012, it announced it surpassed $1 billion in digital revenue during the previous year, which was a huge figure that early in the digital media landscape. It used some of those profits to scoop up another mobile-first gaming company, adding properties like Plants vs Zombies and Peggle to their library.EA completed another mass-firing in 2013, dismissing 10% of their employees under what they called a reorganization, around the same time they announced an exclusive license with Disney that would allow them to develop Star Wars games.Their stock value boomed in the following years, as a result of those cost-savings measures, and those new relationships, and emboldened by record-high stock valuations, in the mid-20-teens, the company started releasing big-name games, like Star Wars Battlefront 2, with random-content loot boxes and other sorts of microtransactions.This did not go over well with players, who decried these in-game purchasing options as ‘pay to win’ mechanics, as players could pay more money to get better characters and equipment, and a lot of the content, even after paying for the expensive games, was still locked behind paywalls, requiring more payments to unlock that content. A bunch of gaming journalists cried foul on this shift as the game careened toward its full release, as did a whole lot of early players, and Disney complained, too, so by the time it hit shelves, the game’s loot system was substantially changed, but that whole controversy spooked investors, and led to an 8.5% stock value drop in just a single month, knocking $3.1 billion from the company’s valuation. As a result of that controversy, EA also became the face for a larger legal and legislative debate about in-game purchases and how it’s kinda sorta like gambling, from that point forward.Soon after, EA experienced a series of bad quarters, including a huge drop of 13.3% to its valuation when a major entry in one of their larger franchises, Battlefield V, was released late, and received very mixed reviews when it was released, which led to a million fewer sold copies than anticipated. The game was also lagging in terms of gameplay behind smaller, nimbler competitors, including then-burgeoning Fortnite.The company saw an overall boost with the surprise success of Apex Legends, and the COVID-19 pandemic boosted sales dramatically for a while, since everyone was staying home, which allowed EA to gobble up a few more competing companies with successful franchises, and they knocked out a few more successful Star Wars games, as well.In early 2021, Saudi Arabia’s public investment funds bought 7.4 million shares of EA for about $1.1 billion, which flew under the radar for most gamers, but that’ll be important in a moment.Later that year, the company experienced a massive hack, a lot of its data, including the source code for games, stolen and sold on the dark web. EA bought some more competitors, but word on the street in 2022 was the the higher ups at EA were quietly shopping the company around, themselves looking to be acquired by a larger entity, on the scale of Apple or Disney.In early 2023, the company announced more mass-layoffs and launched another internal reorganization. It gutted several of its most popular gaming sub-brands, including BioWare, it cancelled an upcoming Star Wars game, and it announced that it would be shifting away from licensing agreements and refocusing on EA-owned IP.The pattern of layoffs leading to better financial fortunes didn’t pay off this time, though. In early 2025, EA divulged that it expected to underperform in the coming year, several of its big-name titles not doing as well as expected; the company cast blame on the market, but players and journalists pointed at the company’s gutting of its big-name studios, and the firing of many of its veteran developers to explain the reduced sales.EA had another mass-firing in April of this year, and followed by another in May, which paralleled an announcement that they would no longer be moving forward with a big, planned Black Panther game.In late September of 2025, EA announced that it had reached a deal, worth $55 billion, to go private, no longer selling shares on the stock market, with the financial assistance of a group of investors, which included Affinity Partners, which is led by Jared Kushner, US President Trump’s son-in-law, Silver Lake, which is a US-based private equity firm that helps make these sorts of big sales happen, and the aforementioned Saudi Arabian Public Investment Fund.This deal isn’t done yet, it still needs to get regulatory approval and a successful vote by stockholders, but it seems likely to go through, since the US regulatory environment is pretty lax at the moment, and because Kushner is involved, it’s unlikely President Trump will take a personal disliking to it.But the big story here seems to be that Saudi Arabia is buying up not just a video game company, but one of the biggest and most successful video gaming companies in the world, which, although it’s lost a lot of fan-credibility over the years, still owns some massively influential intellectual property and has just a stunning number of relationships and connections throughout the media world, alongside its huge valuation.If the sale does go through, and we should know for sure by sometime around June 2026, it would be the largest-ever leveraged buyout, which means the purchase was completed by using borrowed money that was borrowed against the asset being purchased; so those investors have taken out debt against EA itself, which is an increasingly common means of buying a large asset on the cheap, but it also typically burdens that asset with a simply astounding amount of debt which must then be recouped, often by selling off undervalued assets.When this happens to a newspaper, for instance, the buyer will often sell off the paper’s real estate and fire all their employees, to make money and pay off that debt, and in this case, there’s a chance