Saturday, November 30, 2019

Climate Crisis: Another Perspective

Why Apocalyptic Claims About Climate Change Are Wrong Few have underscored the threat more than student climate activist Greta Thunberg and Green New Deal sponsor Rep. Alexandria Ocasio-Cortez. The latter said, “The world is going to end in 12 years if we don't address climate change.” Says Thunberg in her new book, “Around 2030 we will be in a position to set off an irreversible chain reaction beyond human control that will lead to the end of our civilization as we know it.” ........... no credible scientific body has ever said climate change threatens the collapse of civilization much less the extinction of the human species ......... It’s not like climate doesn’t matter. It’s that climate change is outweighed by other factors. Earlier this year, researchers found that climate “has affected organized armed conflict within countries. However, other drivers, such as low socioeconomic development and low capabilities of the state, are judged to be substantially more influential.”............... but it’s also true that economic development has made us less vulnerable, which is why there was

a 99.7% decline in the death toll from natural disasters since its peak in 1931.

.......... In 1931, 3.7 million people died from natural disasters. In 2018, just 11,000 did. And that decline occurred over a period when the global population quadrupled. ........ IPCC estimates sea level could rise two feet (0.6 meters) by 2100. Does that sound apocalyptic or even “unmanageable”? ......... Consider that one-third of the Netherlands is below sea level, and some areas are seven meters below sea level. You might object that the Netherlands is rich while Bangladesh is poor. But

the Netherlands adapted to living below sea level 400 years ago.

............ Humans today produce enough food for 10 billion people, or 25% more than we need ........ The United Nations Food and Agriculture Organization (FAO) forecasts crop yields increasing 30% by 2050. And the poorest parts of the world, like sub-Saharan Africa, are expected to see increases of 80 to 90%. ............ Wheat yields increased 100 to 300% around the world since the 1960s, while a study of 30 models found that yields would decline by 6% for every one degree Celsius increase in temperature............. Rates of future yield growth depend far more on whether poor nations get access to tractors, irrigation, and fertilizer than on climate change, says FAO.......... By 2100, IPCC projects the global economy will be 300 to 500% larger than it is today. Both IPCC and the Nobel-winning Yale economist, William Nordhaus, predict that warming of 2.5°C and 4°C would reduce gross domestic product (GDP) by 2% and 5% over that same period............. Climate change may threaten one million species globally and half of all mammals, reptiles, and amphibians in diverse places like the Albertine Rift in central Africa, home to the endangered mountain gorilla.......... Of the 10 variables that influence fire, “none were as significant… as the anthropogenic variables,” such as building homes near, and managing fires and wood fuel growth within, forests......... “If you want to minimize carbon dioxide in the atmosphere in 2070 you might want to accelerate the burning of coal in India today,” MIT climate scientist Kerry Emanuel said. ......... “It doesn’t sound like it makes sense. Coal is terrible for carbon. But it’s by burning a lot of coal that they make themselves wealthier, and by making themselves wealthier they have fewer children, and you don’t have as many people burning carbon, you might be better off in 2070.” .........

the extreme rhetoric is making political agreement on climate change harder.

....... “We shouldn’t be forced to choose between lifting people out of poverty and doing something for the climate.” ....... Happily, there is a plenty of middle ground between climate apocalypse and climate denial.

Environmental Progress: Founder President

Monday, November 25, 2019

Tesla Cybertruck Unveil

Why is it called a cybertruck? Why not simply a truck? Is it because it is a lot of software with a little bit of metal and glass thrown in?

Meet the Cybertruck, Tesla's Ford-Fighting Pickup Elon Musk has revealed the latest Tesla model, promising hundreds of miles of range for about $40,000. ....... the top-of-the-line variant, starting at $69,900, will go more than 500 miles between charges, hit 60 mph in under 3 seconds, tow up to 14,000 pounds, and start production in late 2022. ..... Musk spoke to the importance of entering the pickup segment, one of the most popular in the US....... for unclear reasons, it’s bulletproof, at least to a 9-millimeter handgun...... Pickup trucks make up roughly 15 percent of US vehicle sales, a share that has steadily grown since 2009 .......

The Ford F-150 has been the top-selling passenger vehicle in the US for 36 years straight; Americans buy nearly a million every year.

... General Motors nets, on average, $17,000 per pickup. ...... On high-end models with the sorts of options that push sale prices above $100,000, that margin can reach $50,000. ...... The large, expensive vehicles accommodate large, expensive batteries better than a compact sedan does....... Pickup customers are less likely to live in an apartment building than a single-family house where they can install a home charger. On the other hand, public charging infrastructure is hardly developed in the middle of the country where pickups are especially popular. ........ Pickup buyers.. hardly consider fuel economy when shopping. They care about capability and reliability. Plus, compared with other drivers, they’re particularly loyal to their brands of choice.......... For the Cybertruck to succeed the way the Model 3 has, Tesla must steal the customers Ford, GM, Chrysler, and other automakers most value. ....... The Roadster, Model S, Model X, and Model 3 also hit the market well after Musk’s targets. Once they did, they came off the line slowly and with problems.

Tesla Cybertruck: Impressive Specs, Killer Price, Polarizing Looks What was revealed has some damned impressive claimed specs — pretty close to Musk’s boasts that it needs to be better than a Ford F-150 and a Porsche 911 — and a price that made the audience gasp. What was revealed also looks like a 32-bit rendering of that truck you tried to doodle in class before you remembered that you’re bad at drawing. It’s a very interesting mixed bag....... The internet is already full of memes based on the looks of the Cybertruck, because the internet remains undefeated. Musk’s “armored personnel carrier from the future” looks like what the Ghost of Video Games Past drives........ the Cybertruck is bulletproof. Tesla claims the 30-times cold-rolled steel body can withstand a 9 mm bullet fired from 10 meters away........ After dropping metal balls from varying heights on sample pieces of traditional car glass (shattered right away) and the Cybertruck’s “armor glass” (never broke), Musk had Tesla chief designer Franz von Holzhausen throw one of the metal balls at the windows of the Cybertruck on stage. Twice. And each time, the window cracked significantly. Musk was quick to point out that nothing broke into the cabin, and joked about fixing it “in post,” but it was an extremely awkward and deeply funny moment that is going to be replayed on TV and online again and again........ we’re still waiting for the new Roadster two years after its reveal

Give It For Bachchan

NEOM: Governance

I have been blogging about NEOM much recently. I have read little on the topic, and have said much. But on this one topic, I have read nothing. And here are my comments.

The NEOM territory will be a little bit of Egypt, a little bit of Jordan, and a lot of Saudi Arabia. And Saudi Arabia will let go. That is my impression. The Saudi judiciary will have no jurisdiction over NEOM. That is my impression. That is a decision that has already been made.

Saudi Arabia is dangling a wallet with 500 billion dollars in it. But it has to have the humility to see this is not a 500 billion dollar project. This is at least a five trillion dollar project with most of the money coming from beyond Saudi Arabia. Easy math will tell you, Saudi Arabia will have to be willing to give 90% ownership to others. Which others?

NEOM has to be a fresh start for humanity like America was a fresh start for Europe.

But there is land. It is Saudi land, primarily. And the 500 billion dollar does not count the land. The land eventually is worth more than that wallet. After the city of NEOM is up and standing, NEOM land might fetch Manhattan prices. But that is not now.

Walking away from the Saudi judiciary is fine, that is how you give a place a fresh start, but that can not be walking away from God and faith. Every major faith emphasizes family and marriage.

At some level, this is existential for Saudi Arabia. This is do or die. The world needs to walk away from oil for climate crisis reasons. And oil is on its way to getting priced out. So Saudi Arabia has this window in time to diversify and become a post-oil economy. I think it can. It should. Done right the future riches will be greater than the oil riches. Nokia used to be a timber company long before it became a phone company. Great companies and great countries transform as necessary.

NEOM will be a new city. It will be a city-state. Like the Vatican is its own country. That is what I read somewhere. And I don't see how it could work any other way. 500 billion dollars is but seed money. It is a small amount compared to the ambition.

Heck, NEOM could create a world government. Every country willing to pay 1% of its GDP as an annual membership fee would be welcome to join the world government that would have its seat in NEOM, a city-state, a country of its own. That world government can co-exist with the UN. The UN functions more like an NGO. It does not function much like a government. The whole veto thing is so outdated. The UN can keep doing the UN thing. No problem.

The world government would be funded by that membership fee. It would have two chambers. In the lower chamber each country's voting weight would be in proportion to its population. In the upper chamber it would be in proportion to its GDP.

The world government would have a president directly elected by people all over the planet voting on their phones and tablets, using their biometric IDs. The president of the world would also be president of NEOM, but NEOM would also elect a Prime Minister. And that Prime Minister voted in by all residents of the city who have lived in the city for at least a year, would be the one running the city. The president for the city would be more ceremonial.

The city could have a prince in a ceremonial role. The prince of Saudi Arabia can be the prince of NEOM. Why not? Thanks for all that land.

NEOM should have a permanent seat for the world government. It should also have a permanent seat for the T100, the governing body of the 100 biggest technology companies in the world measured by market cap. Issues like data privacy and data security this T100 needs to solve.

And a Consortium of Cities (CC), an annual gathering of the 100 biggest cities in the world. This would be more like an organization for comparing notes and sharing best practices.

The city would provide all government services digitally. The city would use surveillance cameras to attempt a zero crime rate but would do so with the highest standards for privacy protection. Every time anyone enters or leaves the city, they would have to press the finger and submit their biometric ID. They would also have to be willing to do an iris scan and a face scan.

I understand there is a lot of paranoia around biometric IDs, much of it justified, because those who do it seem to have little respect for privacy protection.

All the high tech stuff would be happening in the private sector with individual companies participating. So when there is a failure it is a company and not the city failing. That demarcation is important. There will be plenty of failures. There is no innovation where there are no failures.

Taxes can be as low as possible. The city might even do the Dubai thing for a few decades and have no taxes. Land development pays enough to run the city.

And those are my early thoughts on NEOM governance.

NEOM Beats Mars
NEOM: Wide Participation Will Enhance Chance Of Success
NEOM, Jerusalem: Twin Cities?
My Take On NEOM, The City
NEOM: A City

Saturday, November 23, 2019

The Man Who Solved The Market

Book recommended by Jassim Alseddiqi.

The Man Who Solved the Market employed at the IDA in Princeton ...... While I’ve often heard the story of how he was fired from IDA after publicly criticizing the Vietnam War, less well known is that a big problem was that he was quoted in Newsweek saying he planned to work on his own projects, not government ones, until the war was over.

How to Beat the Market “a blindfolded monkey throwing darts at a newspaper’s financial pages could select a portfolio that would do just as well as one carefully selected by the experts.” ........ the market is so efficient that even professional investors have little chance of beating it on a regular basis. If there’s one reason index funds, which replicate the performance of market indexes like the S&P 500, now hold $4.3 trillion (yes, trillion) in assets .......

Jim Simons is not a blindfolded monkey.

A former code-breaker for the United States government and a brilliant mathematician, Simons founded the most successful investment firm the world has ever seen........ even Warren Buffett’s track record — 20.5 percent annualized returns since 1965 — doesn’t approach Simons’s average of 39 percent gains over a three-decade span. And that’s after his company has taken a 5 percent management fee and 44 percent of the profits. ....... How does Simons do it? We know that his firm, Renaissance Technologies, helped pioneer quantitative investing, relying on complex computer programs rather than human judgment, to make trading decisions. .......... on the subject of his investing success, he is secretive to the point of paranoia. Employees sign ironclad nondisclosure agreements, and are told to avoid media appearances and industry conferences. ........ “combinatorial game theory” and “stochastic equations” ....... turns out that a firm like Renaissance, filled with nerdy academics trying to solve the market’s secrets, is way more interesting than your typical greed-is-good hedge fund....... Simons first began investing as a young man after receiving $5,000 as a wedding gift. He was a commodities speculator for a short time....... a computerized stock trading system that could search — and I’m quoting Zuckerman here — “for a small number of ‘macroscopic variables’ capable of predicting the market’s short-term behavior.” ......... In 1978, Simons left Stony Brook University, where he had built its math department into one of the best in the country, to start the firm that we now know as Renaissance Technologies........ They collected incredible amounts of historical data — not just about stocks and bonds, but about currencies, commodities, weather patterns and all sorts of market-moving events. They made plenty of missteps along the way. But in time, they had gathered so much data — and had computers powerful enough to ingest that data — that the machines found profitable correlations no human could ever suss out, much less understand....... one of the most interesting was the firm’s former co-chief executive, Robert Mercer, the conservative billionaire who funded Breitbart News and Cambridge Analytica. Zuckerman portrays Mercer as “a peculiar but largely benign figure within the company” who liked to zing his liberal colleagues, but mostly kept his own counsel. When his role in conservative politics caused an outcry, Simons felt he had to ask his longtime partner to step down as co-C.E.O. But even though Simons himself was a liberal, he wasn’t happy about it. “He’s a nice guy,” Zuckerman quotes Simons telling a friend. “He’s allowed to use his money as he wishes.” ........

Simons makes money because human behavior will never be completely “efficient.”

...... humans have always acted emotionally ..... “I think the market is reasonably close to efficient,” another well-known quant, Clifford Asness, once told me, “but there are a lot of little inefficiencies.” Those little inefficiencies are what emotionless computers take advantage of. ....... “For all the unique data, computer firepower, special talent and trading and risk-management expertise Renaissance has gathered, the firm only profits on barely more than 50 percent of its trades, a sign of how challenging it is to try to beat the market — and how foolish it is for most investors to try.” ....... In other words,

stick to index funds.

The Man Who Solved the Market — how Jim Simons built a moneymaking machine Gregory Zuckerman’s book lifts the lid on the enimgatic founder of Renaissance who launched the quant revolution ......... The profound and the inane alike are debated on Quora, a website where the curious (or plain bored) can pose questions to the internet hive mind. ......... Renaissance Technologies, a fabled yet secretive hedge fund ......Last year, a rival recounted how he had once nearly poached someone from Renaissance, only to be stymied at the last minute. “I read about him years later,” the Quora contributor wrote. “He bought an Alp. As in . . . an actual mountain in Austria.” ....... the awestruck fascination that Renaissance commands in finance. ...... Machines and algorithms have taken over swaths of markets, supplanting the grizzled traders of public perception, and no one has harnessed computer science and vast data sets to invest as successfully as Renaissance. “It’s the gold standard of computer trading,” one rival once ruefully admitted to me......... Even most people in finance would struggle to identify Simons out of a line-up of similarly disheveled octogenarians. Indeed, his chain-smoking, silver beard, wryness and reluctance to wear socks all make him seem more like a Coen Brothers character than a colossus of investing........ Quoting Benjamin, Animal Farm’s wise old donkey, Simons said:

“‘God gave me a tail to keep off the flies. But I’d rather have had no tail and no flies.’ So, that’s kind of the way I feel about publicity.”

....... the most fascinating man in financial markets: a liberal mathematician who once motorcycled from Boston to Bogotá, was ejected from the Soviet code-cracking team at the Institute for Defense Analyses for opposing the Vietnam war, and then built the most relentless of moneymaking machines. ..... Renaissance has generated over $100bn in trading profits since 1988 — more than any other hedge fund in history — making millionaires of many of its employees, and several billionaires. Forbes puts Simons’ fortune at above $21bn, leaving other hedge fund magnates and financiers such as Ray Dalio, George Soros and Stephen Schwarzman trailing......... Quantitative finance — as it is dubbed — may seem a recondite subject to many people, but it is profoundly reshaping the investment industry, and thus capitalism itself. And Renaissance is the shining example of what can be achieved by applying modern technology, big data and lots of brainy people........... Renaissance is also emblematic of an era where technology helps money and power accrue to an increasingly small number of people. The choices that these people make can reverberate globally. While Simons has become one of the world’s biggest backers of scientific research and philanthropy — and a host of Democratic politicians — his former colleague Robert Mercer has funnelled his billions into the far-right Breitbart News, the election of Donald Trump and Cambridge Analytica, the political consultancy ........

Renaissance’s first years were spent in a poky office in a Long Island strip mall. Regulators once came calling after recommendations spat out by the early algorithms saw Renaissance nearly cornered the potato market.

......... Failure often loomed. When Renaissance’s first foray into bond markets turned into big losses, Simons admitted to a colleague that “sometimes I look at this and feel I’m just some guy who doesn’t really know what he’s doing”...... Renaissance has enjoyed a golden run the likes of which investing has never seen. When it notched up its first $1m one-day profit in 1990, Simons handed out champagne — but $1m one-day gains quickly “became so frequent that the drinking got a bit out of hand” ........ For all Simons’ undoubted brilliance, the book makes clear that his skill was not inventing complex trading models and algorithms himself. His talent was to spot, nurture and harness beautiful but often combustible minds such as James Ax, Lenny Baum, Elwyn Berlekamp, Henry Laufer, Peter Brown and Mercer........ one of the biggest actors in one of the biggest stories of our time: how machines conquered financial markets.

NEOM Beats Mars

If you have read three articles on NEOM, it is fair to say you are no NEOM expert, and I am no NEOM expert. I expect to read up on it a little bit more. But sometimes it is an advantage to have read less. That gives you a freshness of perspective.

NEOM: Wide Participation Will Enhance Chance Of Success
NEOM, Jerusalem: Twin Cities?
My Take On NEOM, The City
NEOM: A City

Every astronaut has been an athlete. You need to be in an absolute great shape physically to experience that pressure on your body when the rocket accelerates at rocket speed to get out of the clutches of earth's gravity. This means everyone who buys a ticket from Elon to go to Mars will have to attain that athlete status. And that's for the first part of the journey when gravity is a big problem. Then you have a nine-month journey of being in a no gravity zone. That actually is harder on the body. Lack of gravity is very challenging for your bones, for your eyes, for your body in general. And there no amount of physical training can prepare you.

But NEOM does not have that Mars problem. NEOM is on earth. Mars has been sold as a fresh start for humanity. NEOM can be that fresh start. But it has to be a fresh start in many ways. It has to be a fresh start politically, economically, technologically.

NEOM needs peace. NEOM needs the Saudi-Iran regional cold war to end. NEOM needs genuine peace between Israel and Palestine. Peace is necessary infrastructure.

Also, NEOM is not going to have, so what air do we breathe issues. It is not going to have radiation issues. Earth has a magnetic field that protects it from solar radiation.

There are also psychological issues. If you keep people in a small space for too long, many get claustrophobic. And they start acting up.

Is Elon Musk Just Getting Started?
Elon Musk's Giant Blind Spot: Human Beings

Humans Will Never Colonize Mars The Red Planet is a cold, dead place, with an atmosphere about 100 times thinner than Earth’s. The paltry amount of air that does exist on Mars is primarily composed of noxious carbon dioxide, which does little to protect the surface from the Sun’s harmful rays. Air pressure on Mars is very low; at 600 Pascals, it’s only about 0.6 percent that of Earth. You might as well be exposed to the vacuum of space, resulting in a severe form of the bends—including ruptured lungs, dangerously swollen skin and body tissue, and ultimately death. The thin atmosphere also means that heat cannot be retained at the surface. The average temperature on Mars is -81 degrees Fahrenheit (-63 degrees Celsius), with temperatures dropping as low as -195 degrees F (-126 degrees C). By contrast, the coldest temperature ever recorded on Earth was at Vostok Station in Antarctica, at -128 degrees F (-89 degrees C) on June 23, 1982. Once temperatures get below the -40 degrees F/C mark, people who aren’t properly dressed for the occasion can expect hypothermia to set in within about five to seven minutes............. The notion that we’ll soon set up colonies inhabited by hundreds or thousands of people is pure nonsense.......... Gravity on the Red Planet is 0.375 that of Earth’s, which means a 180-pound person on Earth would weigh a scant 68 pounds on Mars. While that might sound appealing, this low-gravity environment would likely wreak havoc to human health in the long term, and possibly have negative impacts on human fertility. ........ the unfulfilled visions proposed during the 1940s and 1950s........ “Back then, cover stories of magazines like Popular Mechanics and Popular Science showed colonies under the oceans and in the Antarctic,” Friedman told Gizmodo. The feeling was that humans would find a way to occupy every nook and cranny of the planet, no matter how challenging or inhospitable ........ “But this just hasn’t happened. We make occasional visits to Antarctica and we even have some bases there, but that’s about it. Under the oceans it’s even worse, with some limited human operations, but in reality it’s really very, very little.” As for human colonies in either of these environments, not so much. In fact, not at all, despite the relative ease at which we could achieve this...... Unlike other fields, development into human spaceflight, he said, “has become static.” Friedman agreed that we’ll likely build bases on Mars, but the “evidence of history” suggests colonization is unlikely for the foreseeable future........ astronauts on the ISS, who are subject to tremendous muscle and bone loss, try to counteract the effects by doing strength and aerobic training while up in space. As for treating the resulting negative health impacts, whether caused by long-duration stays on the ISS or from long-term living in the low-gravity environment of Mars, “we’re not there yet” ........ It’s a dangerous delusion to think that space offers an escape from Earth’s problems. We’ve got to solve these problems here. Coping with climate change may seem daunting, but it’s a doddle compared to terraforming Mars. No place in our solar system offers an environment even as clement as the Antarctic or the top of Everest.

There’s no ‘Planet B’

....... Martian terraforming is a pipedream, a prospect that’s “way beyond any kind of technology we’re going to have any time soon” ....... radiation on Mars is far worse than we thought, adding that “we don’t have the long-term solutions yet, unless you want to risk radiation illnesses.” Depending on the degree of exposure, excessive radiation can result in skin burns, radiation sickness, cancer, and cardiovascular disease........ Life in a Martian colony would be miserable, with people forced to live in artificially lit underground bases, or in thickly protected surface stations with severely minimized access to the outdoors. Life in this closed environment, with limited access to the surface, could result in other health issues related to exclusive indoor living, such as depression, boredom from lack of stimulus, an inability to concentrate, poor eyesight, and high blood pressure—not to mention a complete disconnect from nature......... we don’t see colonists living in Antarctica or under the sea, so why should we expect troves of people to want to live in a place that’s considerably more unpleasant? ....... for prospective families hoping to spawn future generations of Martian colonists, it’s borderline cruelty. ...... Studies of astronauts who have participated in long-duration missions lasting about a year exhibit troubling symptoms, including bone and muscle loss, cardiovascular problems, immune and metabolic disorders, visual disorders, balance and sensorimotor problems, among many other health issues. ...... Some astronauts, like NASA’s Scott Kelly, never feel like their old selves again, including declines in cognitive test scores and altered gene function. ........ The regolith, or soil, on Mars is toxic, containing dangerous perchlorate chemicals, so that also needs to be avoided. To grow crops, colonists will likely build subterranean hydroponic greenhouses. This will require specialized lighting, genetically modified plants designed specifically for Mars, and plenty of water, the latter of which will be difficult to source on Mars.........

We may be stuck on Earth.

Wednesday, November 20, 2019

Hate Less, Love More (Via Talal Al Murad)

Via Talal Al Murad (One Of The Top 50 Most Influential People On LinkedIn)

NEOM: Wide Participation Will Enhance Chance Of Success

I know very little about NEOM right now. I have been upfront about that. 500 billion dollars is a lot of money. But not entirely enough to build a city. There necessarily will have to be wide participation, and the many stakeholders that will come to join the ranks will all knock on the wood. That feedback loop might not always be convenient. It might even slow things down now and then. But overall that will be a good thing. That will enhance the chances of success.

NEOM, Jerusalem: Twin Cities?
My Take On NEOM, The City
NEOM: A City

What can NEOM do to enhance its chances of success?

(1) Wide Participation: Wider the better.

(2) $500 Billion Has To Be A Force Multiplier: If that $500 billion is the primary fund, it is obviously not enough money to build a city 33 times the size of New York City. NEOM has to feel like Europeans going to America, a land to give themselves a fresh start. And so techie gimmicks are not going to be enough. If you only have money and robots and cars and buildings, you could just end up with a white elephant.

(5) NEOM Needs Peace: There has to be peace between Israel and its Arab neighbors. The Palestine issue has to be resolved. Peace is the necessary precondition to prosperity anywhere.

(6) The Economic Viability Test: Cutting edge stuff can start in NEOM, but if they only stay in NEOM, if they can not be scaled to many parts of the globe, chances are that particular techie gimmick is not economically viable. Most stuff that is being dreamt for NEOM is going to have to pass that viability test. Otherwise, you just end up with a bunch of expensive failures. What that means is NEOM needs an active feedback loop that ties it to the rest of humanity.

(7) Attracting Top Tech Entrepreneurs: Can NEOM attract many of the top tech entrepreneurs of the emerging technologies? A defining quality of the golden era of Islam was an enormous thirst for knowledge. That thirst has to be brought back.

Saudi Arabia's NEOM: A US$500 Billion City Being Built 'For A New Way Of Living' Saudi Arabia’s Crown Prince Mohammed bin Salman announced on Tuesday the Kingdom’s most ambitious plan yet to free itself from dependency on oil. Prince Salman revealed a US$500 billion proposal to build a new transnational “independent special zone” on the Red Sea coastline that extends into Jordan and Egypt. Strategically located in proximity to international markets and trade routes, the 26,500 square km zone -dubbed as NEOM- is set to be powered by renewable energy, and has its eyes on incorporating elements of key sectors such as energy, advanced manufacturing, biotech, and media & entertainment........ will operate independently from the “existing governmental framework,” and is said to be funded by the Saudi government, its sovereign wealth fund, and local and international investors ....... Dr. Klaus Kleinfeld, the former Chairman and CEO of Alcoa and Arconic Inc. has been appointed as CEO of NEOM. “The NEOM project is set to transform the Kingdom into a leading global innovation and trade hub through the introduction of value chains of traditional and future industries and technologies to stimulate local industry, private sector job creation and GDP growth in the Kingdom” ........ The completion of the first stage of the project is expected to be by end of 2025, and its contribution to the Kingdom’s GDP is projected to reach “at least $100 billion by 2030.” It’s exciting times ahead for Saudi Arabia as the world watches how the Kingdom follows through on its ambitious economic and social upheaval plans.

I just read this phrase: "the world's first independent special zone." That is intriguing. Somebody said Catalonia has not been able to break away from Spain, but Saudai Arabia is voluntarily shedding NEOM! I think the idea of an independent city state is great. That will allow for maximum participation from numerous stakeholders. That is the only way to ensure success.

NEOM has to be able to compete with Dubai in terms of being able to attract people from all over the world. The number one quality I look for in any city anywhere is cultural diversity.

This is not just about technology. This is also about political innovation. And starting from scratch is the best way. May I suggest a few things?

All government services should be digital, and people should be able to vote on their phones, for a week. And anyone who has lived in the city for at least a year is automatically a voter.

Create a T100 along the lines of G20. These are the top 100 tech companies in the world as measured by market cap. They are given a Senate like space where to meet every year.

NEOM ought to have active ties with the 100 biggest cities in the world. In fact, build a Consortium Of Cities (CC). The mayors of the 100 biggest cities in the world meet here annually. To share best practices. To tackle big problems.

King Salman chooses staycation in Neom, Saudi Arabia’s new $500bn resort King Salman will avoid France this year to stay at the as-yet-unbuilt Neom, which artists’ impressions have labelled a City of the Future ........ When times are hard even Saudi monarchs are forced to forego the pleasures of the Mediterranean and opt for staycations......... King Salman, famed for the opulence and scale of his summer holidays in the South of France and Morocco, is staying this year in a new resort being built on Saudi Arabia’s Red Sea coast.

Tuesday, November 19, 2019

NEOM, Jerusalem: Twin Cities?

My Take On NEOM, The City
NEOM: A City
Getting To Know Mustafa Kheriba
Vertical Forests
Apple, Android, And Ancient Greece
Neil Sahota, Andrew Yang And The Creative Destruction Of Jobs By Robots And AI
The Real Burj Khalifa (In The Foreground)

I have had a little bit more time to think about NEOM in the back of my mind. Ends up it is all about location, location, location!

The make or break part of the concept of NEOM is, can it be economically viable? In NEOM's case that means, can it attract some of the top tech entrepreneurs of the emerging technologies? Lucky for NEOM, because Israel is right there.

The tiny nation of Israel beats all of Europe when it comes to tech, and Europe is no slouch. The idea can no longer be accepting Israel. The idea now has to be to embrace Israel.

Embrace these days means to build a hyperloop from NEOM to Jerusalem to Tel Aviv. Egypt is building itself a new capital. It could be a triangular hyperloop: NEOM to Jerusalem to Cairo.

Monday, November 18, 2019

My Take On NEOM, The City

Today I got to connect online with Mustafa, who I believe is Man Friday to Mr. Jassim, by all impressions Michael Jordan to Finance in the Gulf Region, the man with a Midas touch, the turnaround artist, someone to watch.

(Full disclosure: Noor Almuna chaired by Mr. Jassim has approved a loan towards my real estate tech startup.)

I started reading some of Mr. Mustafa's articles online. In one article he mentioned NEOM. This was obviously not the first time I had heard of it. In fact, I heard of it when it was first announced. But I had not had a chance to dig deep into it. Today I got that chance. Digging deep is actually quite a surface level digging. You do a simple Google search, and you read the first few articles that show up. If the Google algorithms are screwed, you are screwed.

NEOM: A City

I'd like to read up on it some more before I start commenting.

Western media is always biased. It is because when you are a newspaper in a capitalist country, all you really care about is eyeballs and page hits. Ca-ching. So reading western newspapers can not be anyone's idea of searching for the truth. But as long as you are aware there is bias, you can extrapolate. You can condense some of the facts, and try and ignore the opinions. And form your own opinions.

Here's a recent example of the media trying to create a fight when none existed.

Having said that, I don't believe it is too early for me to make some comments on NEOM.
  • NEOM has fired up the imagination for the region and the world. This is like Prince Salman's own Mars. Elon Musk might or might not go to Mars, but Mars has been tremendous for his marketing.
  • I commend the desire to do something bold. Saudi Arabia (and the region at large) faces a 10-year window to diversify or face decline. Only something big and bold might work. I am reading a book right now called "The Uninhabitable Earth: Life After Warming by David Wallace-Wells," and I am thinking, if someone were to make a movie out of it, it would be the top horror movie in movie history. Global warming is not 10 years from now. It is today. It is already happening. The very concept of wealth makes zero sense in a post-warming world.
  • Another reason is economic. Cleantech has been seeing exponential rates of advances. That will lead to plummeting prices. Oil is going to get priced out.
  • NEOM has to make economic sense, first and foremost. It has to be economically viable. Can NEOM attract some of the top tech entrepreneurs of the emerging technologies? That is the make or break question. And I don't know the answer to that.
  • Genetic engineering of human beings is a red flag. All humanity has to be part of the moral/ethical debate on that one. The whole Khashoggi thing was a major PR disaster for the kingdom globally. And that is without pointing fingers on who did it. A genetic engineering disaster is going to be Khashoggi times 100 in terms of PR mess, big enough to sink the entire project.
  • You can do flying cars, why not? But they have to be economically viable. Are they viable? Do the math. And see for yourself.
  • I think the world underestimates the amount of conservative friction/opposition the prince faces inside Saudi Arabia because it is a monarchy. In his own way he has been Saudi Arabia's own royal Mikhail Gorbachev. He has opened up things. Women drive. Young people attend pop concerts. These have been big changes to the Saudi scene.
  • The number one thing I noted was, NEOM is going to be its own judicial jurisdiction independent of the judiciary in Saudi Arabia. I consider this a masterstroke, politically speaking. The Dubai Sheikh did something similar when he created the financial hub in Dubai. And that is what made it possible.

NEOM: A City

Saudi Arabia wants NEOM to have flying cars, a fake moon, and 24/7 surveillance The futuristic city-state rising on the northwestern corner of Saudi Arabia ....... aims to transform 10,000 square miles of desert into “the world’s most liveable city” ....... a place of extreme automation, surveillance, and wealth meant to attract large Western companies, help diversify Saudi Arabia’s economy, and decrease its financial reliance on oil. .........

NEOM could be the next Dubai, but with far more advanced technologies and an urban ecosystem built from scratch that would rival every major metropolis in the world

...... NEOM might not be fully realized due to the reported corruption that exists within the Saudi government. Right now, many countries are hesitant to do business there because of it. Even architects and major leaders in the field who previously committed to and served on NEOM’s advisory board are flat-out refusing to work with the country anymore.......... Located on the very edge of Saudi Arabia where the Red Sea meets Egypt, Israel, and Jordan, NEOM features a masterplan that’s rather inconceivable and extremely expensive, but construction is already underway and an airport has already been built. Here are some of the consultants’ big ideas: flying taxis to take residents to work, robot maids to clean peoples’ homes, beaches with glow-in-the-dark sand, cloud seeding to bring rain to the hot desert, a hologram faculty teaching at leading local schools, a robot dinosaur island that serves as a tourist attraction, and state-of-the-art medical facilities where scientists will work to “modify the human genome to make people stronger.” Last but not least, MBS wants to build an artificial moon that would light up the city at night. While that could be accomplished with drones, one of the more nefarious ideas proposed by MBS himself is the constant surveillance of NEOM’s citizens through facial recognition technology and a legal system operating outside the bounds of Saudi Arabia’s courts............ the proposal for NEOM was dreamt up by a team of U.S.-based consulting and management firms.......... Boston Consulting Group, McKinsey & Company, as well as Oliver Wyman, were working on the project....... recommendations go beyond urban planning and include a slew of economic incentives and legal systems that NEOM could utilize to both lure residents and keep them there. ...... NEOM‘s first phase of development is expected to be completed by 2025

Virgin Hyperloop One hits major bumps in the wake of Saudi controversy Last month, Saudi Arabia nixed a deal to construct a hyperloop in that country after former chairman Richard Branson criticized the kingdom’s alleged killing of Washington Post journalist Jamal Khashoggi. The Saudis announced a $1 billion investment in Virgin Galactic, another venture by Branson, after Branson stepped down as the chairman at Hyperloop. ...... With Branson and Lloyd gone, Sultan Ahmed bin Sulayem of the United Arab Emirates (UAE) has stepped in as the new chairman. His company, DP World, a UAE-based shipping and logistics group, is now Virgin Hyperloop One’s largest investor.

Robot cage fights and flying taxis: leaked documents reveal Saudi Arabia’s plans for its next megacity Neom could be $500 billion city-state or another colossal waste of wealth .......... The riches of Silicon Valley have enabled some extravagant and quixotic projects, but they’ve got nothing on what oil money can do. ...... Saudi Arabia’s biggest megaproject yet: a city built in the desert named Neom, where robots will outnumber humans and hologram teachers will educate genetically-enhanced students............ The details are stunning. It’s a mixture of dystopian fiction (AI surveillance cameras everywhere!) and childish imaginings (let’s build a robot dinosaur park!). Taken together, the plans remind of you what a dedicated nine-year-old can achieve in Minecraft. Yes, the scale and ambition are impressive, but it’s not like you could do this in real life, right?............. proposals, of course, dreamt up by American consulting firms like McKinsey and Boston Consulting who have no incentive to bring Saudi leaders down to Earth. But all the same, they give you a flavor of what trillions of dollars of oil wealth will do to your sense of proportion .......... plans from Japanese tech giant Softbank to create “a new way of life from birth to death reaching genetic mutations to increase human strength and IQ.” ....... “I don’t want any roads or pavements. We are going to have flying cars in 2030!” said Prince Fahd bin Sultan, the region’s governor, in a planning meeting. Another planning document reportedly read: “Driving is just for fun, no longer for transportation.” ........ Crown Prince Mohammed bin Salman, saying he wants the city to attract the “world’s greatest minds and best talents.” ....... bin Salman “envisions Neom the largest city globally by GDP, and wanted to understand what he can get with up to 500 billion USD investment.” ........ The project is the flagpole of Saudi Arabia’s plans to diversify the country’s economy away from oil. ....... The project is the flagpole of Saudi Arabia’s plans to diversify the country’s economy away from oil. ......... As currently planned, Neom will occupy a region the size of Massachusetts. This will include a huge coastal urban sprawl; outlying towns and villages; advance manufacturing hubs in industries like biotech and robotics; and links with international shipping routes. Early building work has already begun, with facilities including a new airport and palace. ............. A lot of factors have stopped Saudi Arabia attracting international business thus far ..... corruption, a difficult legal system, and social norms that range from unappealing to straightforwardly immoral for Western visitors. .......... a country in the desert desperately trying to turn oil riches into a technological haven before it’s too late.

Getting To Know Mustafa Kheriba

Mustafa G. Kheriba

Opinion: The UAE's shift towards becoming a hub for financial innovation The country's financial sector shows how leading the pack leads to unprecedented value ....... The United Arab Emirates has emerged as a shining example of how a traditional oil powerhouse can diversify its sources of national revenues away from oil to other industries. ..... the banking sector in the UAE continues to be quite fragmented, with 23 domestic banks and 29 foreign institutions operating onshore, as well as a plethora of alternative finance companies that exist to serve SMEs and retail clients whom have exhausted traditional banking lines and offerings. ........ hydrocarbons sector will continue to be the compelling force behind anticipated growth for the near future ......... The UAE banking sector recently saw the merger of two dominant players, First Gulf Bank and National Bank of Abu Dhabi, creating one of the largest financial institutions regionally, with the breadth and scale to be competitive globally....... property markets across the emirates continuing to show softening trends in prices and depressed yields ....... Fintech is redefining modes of operation in the financial industry, and we are witnessing unprecedented levels of change and growth....... Fintech – which is now omnipresent in the industry – is providing the critical elements of swift action, more convenience and higher accessibility to the delivery of financial services. The influx is exceptionally transformational and continues to gain momentum........ The UAE has been at the forefront of such changes, with the introduction of e-banking, e-dirhams, online platforms and regulatory bodies such as the Abu Dhabi Global Markets and Dubai International Financial Centre serving as bright examples of how the country is becoming a hub for financial services innovations in the region. ........ as the country works towards a roadmap for the UAE’s centennial in 2071

THE GCC: OPPORTUNITY BORN FROM POSITIVE MOMENTUM Why the GCC is geared to become one of the most rewarding investment destinations in 2018 Sovereign wealth institutions in the region are among the wealthiest in the world, and the investment appetite for diversifying national sources of revenue has always been healthy. ....... we are seeing a fundamental change. The GCC is increasingly becoming a destination for capital deployment with ample opportunities for investment in various sectors such as hydrocarbons, healthcare, education and real estate to name a few. ........ The oil crisis has had a positive impact in allowing the regional regimes to explore new avenues of income. ...... A big theme I predict in 2018 is consolidation, as well as acquisitions outside of the region that will help with the diversification of funding sources and capital inflows. ...... the quiet before the storm of 2018. The region will see the best and fastest to come in the next few years........ The robust economies of the UAE and Saudi Arabia continue to lead the pack. ......... Saudi Arabia is in a positive momentum given the recent reforms implemented by HH Sheikh Mohammed Bin Salman the Crown Prince. The fight against corruption surge that has been going on in the last few months has given great hope to the people and to the positive growth momentum of the economy in general. The initiatives are moving Saudi Arabia away from secular and rigid Islam, to more moderate and mainstream Islamic beliefs and practices.................... He has been named among the top 50 MENA Fund Managers in the 2015 and 2016 annual survey conducted by MENA FM. Mustafa holds a BA from the University of Toronto, and an MBA from Ohio Dominican University with Magna Cum Laude honours.

A LETTER FROM ABU DHABI On innovation and why Brexit does not represent erosion of value Abu Dhabi has been aspiring to be the Middle East and regional hub for everything from regulated financial services through setting up Abu Dhabi Global Market, to arts and culture and the highly anticipated opening of the Louvre Abu Dhabi. It is where we call home, and from where we aim at conquering the world........ Spending time in Riyadh at the Future Investment Initiative was both inspiring and aspirational. His Royal Highness Prince Mohammad bin Salman laid out what he sees as beyond the Vision 2030 to outline a new remarkable city, Neom, and a bright future for the Kingdom. ....... the adamancy that moderate Islam is the only way forward and the accepted path, while eradicating extremism was key .......... Today, and after only six years of launching the company out of Abu Dhabi, Abu Dhabi Financial Group (ADFG) has become synonymous with opportunistic investing and an astute deal making. Our platforms now expand across multiple geographies with a particular focus on public equities, private equity, real estate, debt and technology. Early in 2011 we launched the first secondary private equity fund that served to provide liquidity to an otherwise cash crunched microeconomic environment. The fund focused on limited partners who invested in regional funds. Good assets held by ailing investors was the key message that helped us realize handsome returns by acquiring these positions at significant discounts to their intrinsic value....... At over $5 billion of direct assets under management, ADFG is considered a serious contender and a market maker. One of our key calls to fame is our real estate development activities in the UAE and London. Today we stand as the largest private developer of new builds in prime central London with over £3 billion worth of projects underway.

The reality of real estate Real estate has always been the surest way to accumulate wealth – and is likely to remain so. Yet, the financial crisis of 2008 changed the game, and brought a healthy dose of reality back to the real estate sector. Today, as investors look at this asset class again with renewed optimism, we need to ask ourselves if we have truly learned the lessons of the past five years. ........ real estate has provided investors with a stronger and steadier return than any other investment option. It has an uncanny ability to bounce back after a downturn and outperform other asset classes......... The 2008 crisis was a case of the pursuit of profit crowding out sensible investment decision making. ....... Many lost vast sums of capital when property values plunged by half. ...... Abu Dhabi and Dubai real estate sales showed a significant upward trend from Q4 2011 to Q2 2012. Despite a slowdown during the third quarter, year-on-year activity was still higher, suggesting that Abu Dhabi and Dubai’s real estate market is well on the path to recover.......... and with the absence of property taxes and income tax, the value becomes extremely competitive, especially compared to other major cities around the world........ thanks to more people investing in completed projects rather than speculating on off-plan developments. ....... The UAE’s sophisticated regulatory milieu, highly developed financial infrastructure, and a legal system increasingly following rules of global best practices, provides a healthy investing environment for both home buyers and investors alike. In addition to the solid commercial infrastructure, the time is right to capitalise on the underlying value waiting to be unlocked in the UAE real estate sector.