Going Along to Get Along

Welcome to This Week’s Leyendecker View

The absence of alternatives clears the mind marvelously.
– Henry Kissinger, RIP

A BIG THINK: COP28-ING OUT

Going Along to Get Along

The COP28 summit came to an end with a global commitment to transition away from fossil fuels.

After much heated debate, and presumably many threats thrown around, national representatives at COP28 decided to go along to get along. Does this foretell the end of fossil fuels? Most likely not. It’s kind of like asking everyone at the UN to agree to no more war. Of course everyone would sign on to that.

Remember that COP28 is an event dominated by bureaucrats. They can say what they want. But when the rubber meets the road, countries will do what they have to do to make their voters happy. In case COP28 participants had not noticed, voters have been throwing out legacy bureaucrats that have supported industry-killing climate change policies and woke identity politics.

You may have seen this in a previous newsletter, and you’re likely going to see it again and again: Climate change policies do not pass the cost-benefit test. The author of that article, Bjøorn Lomberg, may be the most practical thinker on both sides of the energy debate. 

From Lomberg’s point of view, it’s past time for the West to get real about energy and climate before we destroy our economies in a misguided quest to “save the planet,” which doesn’t need saving. (The earth will be around billions of years after human beings are gone.)

Up until recently, Europe led the climate change charge. Then Biden passed his Inflation Reduction Act, a policy that may actually increase the cost of energy and, thus, inflation. Did you get that? IRA—the Inflation Reduction Act—may eventually be the driver of future inflation.

Why was Europe the one leading everyone out of our supposed dark energy era? Well Europe has very limited hydrocarbon natural resources. And, other than France, the majority of Europe is not interested in nuclear power.

This puts Europe at an economic disadvantage relative to the United States, which has a bounty of hydrocarbon natural resources. Forcing the US and other countries to give up hydrocarbons is actually good for Europe’s competitive position in the global economy.

Do you think Europe’s energy disadvantage has anything to do with its demand for eliminating hydrocarbons from every country’s economy?

I’m sure the Europeans are celebrating their victory: Joe Biden has now taken the lead to hobble his own economy.

It will be a great irony if renewable energy proves to be bad for the environment. We still really don’t know what to do with all the spent windmills, solar panels and EV batteries. Billions and billions of them are in our future. And what about renewable energy’s effects on the natural habitat? What of those dying whales and dying eagles? Which other species or ecosystems are damaged by renewables?

Do you know how long humans have been burning hydrocarbons for energy? Since the day we discovered fire. You think an infrastructure that old can be replaced easily, quickly and cheaply?

Shouldn’t our goal with energy always be to make it cheaper and cleaner? We need to be much more focused on adaptation investing as well as investing in technologies that reduce energy consumption without disrupting our economies.

The bureaucrats have spoken. Let’s go along to get along, they’ve declared. Now let’s see what the voters think.

THE ECONOMIC VIEW

Consumer sentiment improves
Could it be due to the rising stock market?
November retail sales grew

Industrial policy, is it vitamin C or penicillin?
Seems more like penicillin these days.

Natural indicators of recession graph
Don’t see any potential recession here.

THE INFLATION BOGEYMAN

Inflation cools to 3.1%
‘Cause the global economy is cooling???

Health care inflation grows 6+%
The average person can’t afford health care.
The government can’t either

No more inflation in building materials
Yet prices are 30% higher than Jan 2020.

THE LABOR VIEW

Doctors and pharmacists are in revolt
They feel like punch-clock workers.

WFH’s biggest winners and losers
Remote and hybrid work are not going away.

The age of cushy tech jobs is over
As tech companies rationalize employment.

Real average earning for the year
Are up a whopping 0.8%

MEANWHILE IN EUROPE

European countries want Russian steel
China’s steel is not good enough.

The UK desperately needs a growth plan
They’re still reacting rather than “proacting.”

Europe lacks worthwhile military might
Too bad Russia knows this.
Germany uncovers Hamas terror plot

THE GLOBAL GAME

Iran has a worrisome new dissident.
A dancing taxi driver becomes a hero

Apple leads tech pivot to India
India builds dormitories to lure workers.

The world’s poorest countries
Have enormous debt challenges

THE UKRAINE FIRE

EU opens membership to Ukraine
While Hungary blocks aid.
And Putin vows to push on

The countries supplying aid to Ukraine
No surprise who tops the list, by a long shot.

Has Russia lost 90% of its pre-war military?
US estimates 315,000 casualties
They’re certainly not panicking.

THE GAZA FIRE

The UN wants a cease-fire
Bureaucrats neither raped nor beheaded.

Biden tells Israel what to do
Like he’s running the country???

Israel has the tactical advantage
By gleaning real-time, captured info.

THE NEW COLD WAR

IMF says Cold War II may be coming
Hey guys, it’s already here.

Is the world in disarray?
Long-time diplomat says it’s worse than that

War is on the rise…everywhere
Highest number of conflicts in 3 decades.

FINANCE

Geopolitics pose the biggest market risks.
According to a poll of institutional investors

Hundreds of stocks trade for less than $1
Why are these companies public?

PE sponsors and portfolio company CFOs
Are not synced up very well

REAL ESTATE

Home prices plunge in Sweden
Canary in the coal mine?

Renters getting landlord concessions
The apartment market may have peaked.

The math for buying a home
No longer works
Although mortgage rates keep falling

IN THE CHIPS

Without chipmaking
Taiwan’s economy would likely collapse

Global chip manufacturing capacity
The US doesn’t really compete.

A global chip glut is coming
Suggests giant Chinese chip-maker.

PC chip wars may also be coming
Apple’s new proprietary chips set a new standard.

TECHNOLOGY

No hyped tech gadget this Christmas
Are people finally wanting to unplug?

Apple’s best product costs 99 cents
Wanna “hide” your email?

FDA approves first CRISPR drug
Kicking off an onslaught of CRISPR therapies?

THE CHAT ON AI

Could Google’s AI
Destroy online publishing?

Is AI’s copyright problem fixable?
These folks seem to have a plan.

The EU agrees on AI regulation
But the genie is already out of the bottle.

THE NEXT NORMAL

Premium whiskey prices slump
Luxury watch sales slump
Luxury stores bursting with inventory
The luxury economy may have peaked.
Except in Japan

Infrastructure and IRA bills support reshoring.
But are there enough workers?

If the world is about to end
Why go to college?

THE WAR ON CARBON

Norway oil & gas investments set to soar
Get that cash while you can!

50 oil companies pledge methane reductions
Smaller companies are now acquisition bait.

Namibia may have huge oil reserves
Think they’ll keep it in the ground?

THE NEW ENERGY TRANSITION

US utility scale solar installs surge
Over 100% jump from last year.
While windmill installs plunge

Can liquid tin store energy?
Bill Gates hopes so.

US battery company darling stumbles
Cash crunch may require government bailout.

THE EV DREAM

What if Tesla is just a car company?
What would it really be worth?
Almost every Tesla in the US just got recalled

EV battery swap stations on the way
Will they be economical for consumers?

Europe’s hottest EV brand
Is Chinese but with an old English name

THE CHINA SYNDROME

China wants only happy social media
Acting ever more like North Korea.

China is easily replacing US tech suppliers
From stealing our IP?

China makes youth unemployment disappear
By no longer releasing the data.

THE WASHING-TONE

House passes new defense bill
Biden expected to sign it.

More free money for state contractors
For high-speed rail that won’t ever get built

Biden pledges $3B to help poor countries go green
Autocrats are calling their Swiss bankers.

MAKING A BETTER YOU

The true science of gratitude
What really makes people grateful?

The 20-5-3 rule
Key to a fulfilling life.

The world inside your gut
Is responsible for way more than you think.

HOW ABOUT A BREAK

Notre Dame’s spire rises again
The French rebuild after the fire.

Synesthesia
What is it, where did it come from?

We love our pets.
Pet expenditures prove it

SONG OF THE WEEK

Sounds every 90s kid will remember
Is this nostalgia comforting?

CASTING AROUND THE PODS

Tucker Carlson joins the All-In Besties
Gavin Newsom the liar and much more.

VIDEOS OF THE WEEK

The newDune: Part Two trailer.
Here come the sandworms!

Godzilla Minus One trailer.
It’s getting monster reviews.
Apple has a new Godzilla series.
Monarch: Legacy of Monsters
And then here comes…
Godzilla x Kong: The New Empire
Oh me, oh my!

The oldest voices we can still hear
When the world changed.
The first sounds ever recorded

FROM THE HEADHUNTER’S KITCHEN

Hanukkah’s over, but the cravings aren’t.
Irresistible potato latkes
Tasty applesauce
Spinach kugel
Chicken matzo ball soup
Brisket bourguignon
Roasted salmon with soy-marmalade glaze
Maple roasted carrots
Sautéed cabbage
Orange walnut rugelach
Yammy food for any holiday celebration!

THE RANDOMS

The latest inflation report can thank plummeting gasoline prices. They buffered higher prices in the cost of cars, insurance and dining out. Plummeting natural gas prices should soon lead to lower costs for heating your home and water, using your stove and oven and drying your clothes.

If too much free and easy money caused inflation, then why is inflation falling when US consumption is still rising?

Conspiracy theory #417: Is it a coincidence that the Federal Reserve will likely cut interest rates…IN A BIG ELECTION YEAR!?!

How would AI score on the ESG test? Let’s see…

Environment: It requires a shocking amount of electricity.

Social: It’s supposed to destroy jobs and widen the wealth gap.

Governance: It puts general governance in the hands of a few elites.

Looks like AI gets a big ESG ZERO.

For several years, people have been told that climate change is going to destroy the planet. Now we’re being told AI may destroy humanity. The former fear has likely contributed to our current mental health crisis (especially among the young), while the latter fear is just about a year old. Imagine our mental health as AI gets better and more pervasive.

Stay alive until ‘25!

Just read an essay that suggests a new mantra for the real estate sector: “Stay alive until ‘25.” The hope is that in 2025 interest rates will return to another period where the cost of capital is almost free, boosting current and unwelcome asset valuations. While the author, highly regarded economist Kenneth Rogoff, believes rates will drop in the next recession, he lays out reasons why they will ultimately be higher for longer.

I assume “stay alive until ‘25” is also what the private equity world is quietly thinking.

Are woke narratives the new common sense, or are they the opposite of common sense? Or are they “improving” common sense?

IN CASE YOU MISSED IT

Elon Musk’s F-Bombs
December 8, 2023

Climate Change Policies Are a Bust
December 1, 2023