In short, a local government built an unprofitable Legoland, said local governor threatened not to repay the loans, and now the entire Korean municipal + corporate bond market is at risk.
But the fallout is not limited to local government bonds; it impacts the whole of South Korea’s bond market, worth more than $2 trillion. Corporate bonds are considered less safe than local government bonds. If few buyers are brave enough to buy local government bonds under these conditions, even fewer buyers can muster enough courage to buy corporate bonds. One of the safest corporate bonds in South Korea is issued by Korea Electric Power Corp. (KEPCO). The returns for KEPCO’s three-year bond had climbed from 2.184 percent to 5.825 percent since the beginning of this year. But in its latest issuance, the KEPCO three-year bond worth 200 billion won (about $146 million) could not find a buyer.
And
To prevent the credit market from seizing up completely, the South Korean government stepped in by providing a liquidity facility of more than 50 trillion won (about $35 billion). The Bank of Korea also injected 42.5 trillion won (about $31 billion) to stabilize the short-term bond market, and South Korea’s five largest banks also pledged to provide up to 95 trillion won (about $67 billion) in liquidity. There is an absurdist quality to these measures: On the one hand, the Bank of Korea has been aggressively raising the benchmark interest rate to curb inflation by reducing liquidity, but on the other hand, the South Korean government is injecting liquidity to the market to stave off a total economic collapse.
Podcast: Philosophize This! Topic: Simone Weil (SW)
1928 – Simone accepted to Ecole Normal Superior – Sartre, Derrida, Foucault
One of 11 in her class, only woman
Scored highest marks – second was Simone de Beauvoir
SW tried to live by the values she espoused – a living philosophy
Died at 34 from tuberculosis, arguably from hunger bc she wouldn’t accept more food due to the widespread famine
As a teen, taught herself Sanskrit so she could read Bhagavad Gita
Camus said she was “the only great spirit of our time”
Importance of attention, the ethics of attention
The quality of attention dictates every experience that you have
Different experience of everything you do is available to you – depending on how you choose to pay attention
ONLY if you’re open to receiving it
Most people fall into default state of attention – based on biology and habits
School education – one of first places we learn to pay attention
After graduation, SW gets a job teaching, unique style
Her class would sit under a tree and just think about new problems in a field (eg, geometry)
Encouraged students to think openly and creatively
For complex problems, by default, people search for answers, and settle into incomplete answers, and then it’s about defending your position and finding people who just agree with you
Hardest job of teaching is to change this collectivist way of thinking
Instead, accept that everything you believe is a partial truth, seek new experiences, without agenda
Our thought should be empty, open, not seeking, ready to receive
Concept of “passive activity”
Strike a balance between completely passive and completely in control / aggressive activity
Middle path – put in effort, but remove your personal prejudices, detached from your self
“The great human error is to reason in place of finding out”
She could’ve lived a very comfortable life, but chooses adventure / new experience
Went to the trenches, joined front of Spanish Civil War, lies and says she’s a journalist! Despite being far sighted
Act of courage based on moral conviction
Accidentally steps into pot of boiling oil, scalded badly
Quit job as a teacher
For months, she does physical labor in an auto factory to better understand the working class / worker life
Learns that the main priority of these jobs is the “quota”, the output – matters more than the people
Impossible for these workers to think about other stuff – must meet quota Thinking is the first thing to go
Means to an end for someone else’s economic goal
Made into a modern day slave / robot Zero connection to what you’re producing
Concludes that the biggest thing these factories produce (in workers) is affliction, a spiritual malaise
Affliction is when people are transformed from human begins into things – and they’re incapable of thinking their way out of this stuck place of existence
Force is to humans as gravity is to physical world – what makes things happen Power itself isn’t the problem; the problem is the “pursuit of power”, in this pursuit people will be turned by others into instruments
As remedy, could focus on Political change vs. Spiritual change
All it takes is one person to see things differently to inspire change in others
Suspend your own personal agenda, see others as they are
Stable Diffusion: “edge of tomorrow tom cruise science fiction movie”
I re-watched Edge of Tomorrow last night – probably my fourth or fifth viewing – and it’s just a great film. If you haven’t seen it, would highly recommend. Rotten and IMDB ratings seem to generally agree.
Tom Cruise and Emily Blunt deliver strong leading performances. Cruise is in his element – I’d argue that his tendency to overact (not necessarily a criticism) lends itself to sci-fi even more than “realistic” plots like Mission Impossible. Minority Report is another example. Heightened acting complementing heightened stakes.
Strong supporting performances from Brendan Gleeson and Bill Paxton. Bill’s iconic line “There is no courage without fear”
Standard Hollywood 3 act structure, executed very well. The Act 1 twist (Cruise acquires the power to restart the day), the midpoint low (Cruise’s despair at their inability to cross the battlefield), the Act 3 break (using the transmitter to find the Omega’s real location), the maxed out stakes of the desperate final attack
I need to read the Japanese manga from which the movie is adapted (All You Need Is Kill)
Similar to Inception’s use of “a dream within a dream”, Edge of Tomorrow layers repetitive patterns within the broader repetitive loop which Tom Cruise finds himself trapped in: He wakes up in a helicopter to begin and end the movie, and he wakes up repeatedly throughout to signify resetting the day; He falls in love with Emily’s character by watching her die countless times, just as Emily’s own character fell in love with a man named Hendricks in much the same way when she held the “reset” power
The sci-fi concept of repeating a day (/week/year/life) fascinates me. Groundhog Day was the first such film that I remember watching. There’s also 50 First Dates, Run Lola Run, Primer, among others. I always wonder what I would do with that extra time, and what changes I would make if I truly had a “reset” button.
A universal law of economics says the moment something becomes free and ubiquitous, its position in the economic equation suddenly inverts. When nighttime electrical lighting was new and scarce, it was the poor who burned common candles. Later, when electricity became easily accessible and practically free, our preference flipped and candles at dinner became a sign of luxury.
🤔
I started thinking about what might happen to important areas of our lives if suddenly the currently “luxurious” thing were to become ubiquitous and free:
What if smartphones were free and everyone had one? Luxury would the person who didn’t need a phone, perhaps because they have assistants, or perhaps they have a job that doesn’t require smartphone access.
What if calories were free? Then eating less – or not eating at all – would become the new luxury. Fasting. Caloric restriction.
What if computers were free? Similar to smartphones above, perhaps luxury then is not needing a computer at all. Or having an army of assistants (AI or human) that use computers for you. Or living off the grid.
What if car travel were free? Imagine an era of free energy + self driving cars. Imagine summoning a private car to drive you anywhere you want, within a reasonable distance, and all for the cost of a bus fare or less. Then luxury might look like someone who doesn’t travel at all – who has built himself an all-inclusive resort with every comfort they could need: a home gym, a home garden, a home theater, and so on. Sorta like what the elites did during covid lockdowns.
What if quality healthcare were free? Imagine a machine or system that could examine, diagnose, and cure you of 98% of common ailments, all for a very low fee or completely subsidized by the government. What would an inversion look like? Would people purposefully get sick so they’d better appreciate health? Or would they invest so much in preventive healthcare and personal fitness in order to eliminate the need for common medical treatment?
What if high quality university education were free and universally accessible? Perhaps luxury would be those who skipped university entirely (not unlike today’s fetish around college-dropout-billionaires), either to pursue a career early, or to follow their hobbies and passions (like art or music). Or luxury could be homeschooling, people who opt-out of the institutional education system.
What if life extension were free? What if you could add as many years to your life as you wanted? Then perhaps luxury would be choosing to die.
And this is what “free university education for everyone” looks like to Stable Diffusion:
I’ve been following the FTX bankruptcy like a mouse in a cheese cupboard. Aside from bankruptcy lawyers, the clear beneficiary of this whole saga is Elon Musk because crypto Twitter usage must be through the roof if my own recent addiction is remotely indicative.
Some half baked thoughts as this saga continues to unfold, thoughts that I wrote in 30 minutes and are worth exactly what you paid for them:
I’m surprised that BTC and ETH – the ONLY two blue chips in crypto (and don’t let anyone mislead you into thinking there’s any other token that qualifies) – have held up fairly well, price-wise. Of course that may change before I even hit publish
SBF’s level of psychopathy is off the charts. Apparently the term “psychopath” is more accurate than “sociopath” because psychopaths have better emotional regulation and can appear more charming, whereas sociopaths are prone to rage and more erratic behavior. Perhaps SBF is transitioning now from psychopath > sociopath. I’m just a blogger what do I know
Prescription drugs are powerful. There’s a reason they’re “prescription”. And even with all that research and regulation, we still barely understand what they do to our bodies and minds. But it’s clear they’re doing something, perhaps quite powerful, perhaps quite permanent.
Crypto will survive and thrive in the long-term. Nothing fundamental has changed. This was a centralized failure, a massive bank fraud and trading scam. There’s a reason the two most mentioned comparables are Enron (a public corporation) and Madoff (a Wall Street investment fund).
Bear cycles are ALWAYS more painful than you expect. History never repeats, but it rhymes. In 2014-16, it was exchange failure and bitcoin clones. In 2018-2020, it was ICOs and China ban and regulatory fud. In this cycle, it’s comprehensive institutional failure – lenders, exchanges, and funds. Crypto has problems, many of them, and the criticisms are deserved. But the tradfi water we’re floating in is secured by a very fragile opaque aquarium. Swimmers beware.
The end game is approaching with accelerating speed, both in the broader global financial system, and for crypto’s own place inside it. This debacle will prompt hard questions and even harder regulations, but crypto continues its march towards global adoption and growing usage. The crypto tail increasingly wags the tradfi dog. Meanwhile the tradfi dog appears more and more sickly, limping behind its Central Bank owner.
Prices could dip another 50% from here, or we could see a massive wick up through some combination of a short squeeze, flight to quality (altcoins>BTC & ETH), Fed slowdown, and survivors’ euphoria. I don’t know. And if you have patience, it doesn’t really matter.
