I’m Dumping my Mac

Mac has this little window that pops up for you to send helpful info to Apple whenever an application unexpected closes (“Your report will help Apple improve this software”). Here is the report I just sent to Apple:

I was reading something in Firefox and it just shut down. Actually, Firefox stalls or quits on me on a daily basis. I have almost never successfully shut Firefox down because it stalls.

I have decided to switch back to PC and give my Macbook away. I was hesitating on the decision at the Dell website, then Firefox crashed. That sealed the deal. (I restarted Firefox and then ) I quickly made the purchase.

For more more reasons why I hate Mac, click here.

Why is Jude Shao still in Chinese Prison?

It was my sophomore year when I first learned of Jude Shao, a naturalized American citizen and Stanford business school graduate who had been imprisoned by China for refusing to pay a bribe while running his business. I still remember his quote from the Stanford Daily:

Shao refused to pay what he interpreted as a bribe…. “I had set up the company’s policy not to bribe any government officials in China. I am a Stanford MBA. I wasn’t interested in unethical business practice.”

I just love the pride of his words. “I am a Stanford MBA.” I am above this unethical crap.

I also remember sharing bitter jokes with a friend, also an Chinese-American. We both saw Jude Shao’s story as something that could happen to us. While it is common knowledge that the Chinese government will have its way with its own citizens, and while (we assumed) that Washington DC would (and should) raise a stink if a white American were wrongfully imprisoned by China, Jude Shao’s imprisonment is showing that Americans of Chinese descent are the grey area.

I randomly decided today to google “Jude Shao” today and found the Free Jude Shao website:

He was detained on April 6, 1998, officially arrested on May 8, 1998 and has now been unjustly imprisoned for 9 years. He has 7 years remaining on his 16-year sentence.

Why the hell is he still a prisoner of the PRC?! I imagine the news analysis explanation has something to do with the fact that our country is holding tons of foreigners in Guantanamo without charge and that it would be hypocritical for this government to criticize the PRC of wrongfully imprisoning one of theirs, but damnit that man is one of ours and his country needs to stand up for him and be willing to escalate this Jude Shao debacle to bilateral controversy status.

Tax Fairness, and Who’s an Entrepreneur?

In past months, there has been a ridiculous congressional controversy brewing around the taxation of private equity salaries, particularly in how private equity managers are taxed capital gains for their take-home portion of the gains (instead of at the higher income tax rate that the rest of us pay). I have heard about hedge funds and buyout firms (what my friends usually refer to as “PE”) rising up in arms, and now venture capital are jumping into this circus too.

Throughout this all, I have frankly never heard any good reason why they deserve this advantageous tax rate. Among those reasons are:

1. Excuse: Because PE firms actually have negative years and that not every year is a profitable one, increasing the tax rate would make it harder for them to be profitable over business cycles. My rebuttal: that actually sounds like every other company in the world economy, which should not earn any special sympathy for one of the most lucrative industries in human history.
2. Excuse: PE/HF/VCs deserve special tax treatment because they provide amazing benefits to society, and that higher tax rates would discourage them from working so hard at what they do. Rebuttal: that’s explains why we tax teachers and law enforcement at normal income rates, right?
3. Excuse: Higher taxes would drive the PE industry would move overseas. Rebuttal: US-based VC and LBO will not move offshore, away from the companies they invest in, and as for US-based hedge funds… I somehow can’t imagine sophisticated hedge fund professionals moving from New York to some sparse island country.

One of the new tricks being used by the VC contingent is to call themselves entrepreneurs and to imply that taxing them would hamper the dynamism of the startup economy. One of the founding executives of my company has written a great response to a NYTimes piece that equated VCs with entrepreneurs. It’s a pretty thoughtful writeup and, actually, it also expresses how proud I am to have ended up doing what I’m currently doing.

Great Drama and Oil Trading

This is one of my favorite scenes from Syriana (no spoilers):

Alexander Siddig as Prince Nasir Al-Subaai : I want to create a parliament. I want to give women the right to vote. I want an independent judiciary. I want to start a petroleum exchange in the Middle East, cut the speculators out of the business. Why are the major oil exchanges in London and New York anyway? I’ll put all of our energy out for competitive bidding. I’ll run a pipe through Iran to Europe like you proposed. I’ll ship to China. anything that achieves efficiency and maximizes profit, profit which I will then use to rebuild my country.

Matt Damon as an energy market analyst: Great, that’s exactly what you should do.

Al-Subaai: Exactly, except your president rings my father and says, I’ve got unemployment in Texas, Kansas, Washington state. One phone call later and we’re stealing out of our social programs in order to buy overpriced airplanes. We’ve owed the Americans but we’ve repaid that debt.

Awesome Drama!

And yeah, why in the world are the major oil exchanges in London and New York anyway?! Okay, those are the two major financial centers of the West, which is the center of humanity’s financial power, but what business do speculators have as the largest buyers and sellers of petroleum? I would love to see a thousand barrels of crude delivered to the Goldman Sachs reception desk. Commodities trading originated as a way for supply and demand to lock each other into contracts. As uncertainty about prices grew, so did the commodities trading business, and so entered non-supply-non-demand players like these investment banks and hedge funds. What good do they do for anyone? The best argument I have heard in their defense is that their trades provide liquidity and data points for market researchers, but that does not seem plausible. Since financial trading floors represent neither supply nor demand, they introduce noise, not true votes on the intrinsic price of the commodity.

This is one of many signs I see of over-financialization of a modern economy – more and more of our GDP derives from financial papershuffling rather than actual value creation. Not to make any predictions of a Rome-like decline, but it’s a shame.