As part of the covid-19 response, the US federal government wants to send checks to everyone. Ideally, you pay your taxes individually, you would have each person’s information to send a check to. But its not that easy and it is going to be ripe with fraud and abuse. And unfortunately, banks, who are guilty of several sins again around this, must play a role and take their cut. And the payments will be susceptible to fraud, especially for lower-income individuals with less sophisticated banking technology. ...

It was hugely popular in 90’s and 00’s strategy circles to talk about disintermediation, focus on core, do what you do well and what-not. Well, all of that was only partially true and people & consultants who pushed that as a cure were stunningly wrong as usual. It’s always been the case that economies of scale are important to managing costs. For a long time, companies vertically integrated when appropriate because they felt they could lower their costs or improve their products by controlling their dependencies. The strategy consultants came in and said, no matter what a big or small company can do, if you do not focus on the core you are wasting money and management attention. ...

Many people believe that the government is not working. The storyline is that “we the people” have become polarized and the government no longer works. The left, right, ultra-left and ultra-right are all attacking each other, the middle, the government and everything else. Strangely enough, our government is working. The government is a reflection of the people–that’s a big point about our constitution. When our people are divided and the consensus is far away, the government should not be able to make wild changes. It is after all about “we the people” and not “this group of people over here.” ...

It is an interesting case of blinders when one considers Oracle. While Oracle was quick to enter the business applications market in the 90s, buying Siebel as well as developing their own products, they started missing the mark fairly quickly shontly thereafter. A recent article https://www.cnbc.com/2019/12/05/oracle-shows-buybacks-can-go-too-far.html discusses Oracle buyback frenzy and how it is leaving the company with net debt. There is really only one reason for that–they were Hurded. Mark Hurd ran the company as co-CEO for a long time. Unfortunately, Hurd rips apart companies, with an eye on financials, but without an eye for doing anything useful in the marketplace. He proved that time and time again. First at NEC, Teradata, HP, then at Oracle. Hurd was good at understanding financials and I think that’s critical and good. He was horrible, always, at understanding what makes a company tick and missing big trends. He’s missed them all his life–totally blind. Mostly, he propped up a company playing with financials while undermining its core–the companies would falter after he left and he always left. Hurd would make a good 2nd in command, just not a 1st in command. ...

The recent WeWork IPO debacle shows that the markets can still work. WeWork’s IPO problems show how risk transfer mechanisms expose risks and risk management is an important part of well-performing markets. Here’s the storyline. Private Equity (PE) money takes risks. That’s Ok and a good thing. PE place bets across industries. That’s a good thing as well. The really smart people, we hope, that society should applaud are doing something more concrete then moving money around (yes, sometimes after a “hit” people move to PE). But hope is not a strategy. In the end, we have a bunch of PE people who want returns from their investments and they obtain returns from the work of others–say WeWork. Given all the bets PE places, many will lose, some will win big. ...