Oh no!~ It's SVB all over again. Another long weekend is in the works. Read this to understand what’s going on with the latest bank failure happening in real-time. As we speak, Frist Republic Bank is collapsing and is almost certain to be taken into receivership by the end of business tomorrow (why anyone continued holding the stock past Monday’s massive collapse in stock price - at which point the writing was clearly on the wall - is beyond me). This means the FDIC will step in and wind the bank down and likely look for a buyer for it's book of business. The FDIC insurance deposits up to $250,000, and it has been reported that First Republic has substantial deposits above that threshold. What does this mean? Will depositors see haircuts on their funds or face wipeouts on deposits over 250,000? The government will likely find a strategic buyer who, with possible assistance from the FDIC/Treasury, will take on the liabilities (deposits) and make deposits whole as part of the transaction. 

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The potential buyer would receive a marked-down price on its assets, comprised of performing loans and investments like treasuries and mortgage-backed securities. However, if no buyer emerges - which I believe is unlikely, this could make a good deal for a larger bank (that has a substantial cash position and liquidity) that can absorb the liabilities to buy assets on the cheap from a distressed seller - it would be a more challenging situation. The potential does exist for deposit losses. In reality, the First Republic does have asses, and those would be liquidated. The FDIC would help manage the process of giving deposit holders as much as recovery as the asset sales allow in addition to FDIC coverage. The question is, if there are deposit losses, will the government allow the bank to truly fail - meaning force banking clients to suffer losses? The federal government launched several programs after the SVB collapse and guaranteed all deposits. This was done because, in Janet Yellen's - Treasury security- words, the bank posed a systemic risk to the broader banking sector and economy due to its size and banking relationship. 

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What of note, Yellen also made it clear that this policy was not universal for all banks, smaller banks not designated as systemic risks (a nice, fancy, and more politically palatable way of saying the more toxic phrase with voters, Too Big to Fail, a throwback to the 2008 crisis) would not receive full guarantees on deposits beyond the FDIC insurance limit. This is a challenging situation; it is deeply unfair for one depositor to be made whole while another faces substantial losses do the size of the bank and whom the bank served as clients. SVB benefits not just from size but also due to its customer base of countless large tech startups carrying multi-million dollar deposits. The government feared that not guaranteeing the deposits would lead to a ripple contagion event where many of those start-ups and venture capital funds served by the bank would suddenly find themselves in near or actual bankruptcy - something that would cascade and almost certainly trigger a broader economic recession. 

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The government also wanted to instill confidence in the public that large banks would not fail to quell potential future bank runs on larger banks deeply engaged in capital markets activity that presents a dramatically more severe risk of triggering a full-blown financial collapse where credit markets freeze as all the banks stop trusting each other and then through a self-fulfilling prophecy ALL of the major banks would be faced with likely bank runs all at once, causing catastrophic economic damage that would wipe out trillions of dollars of wealth, skyrocket unemployment to 15%+, send countless Americans into poverty, and would likely take many years, even a decade plus, decade for the US economy (and global - the banking contagion would without a doubt spread to Europe and Asian banking systems). I know this because I was alive and very actively engaged with financial markets and systems in 2008, and that is precisely what happened. However, due to massive intervention, the contagion was finally arrested, leaving only several collapsed investment banks in its wake and the takeover of several more. 

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Again, this dual standard of who faces losses and who doesn't is not fair. It also incentivizes people to withdraw their money at smaller regional banks and give their new business to large banks (JP Morgan, Goldman, Citi, Bank of America, etc.). In some ways, this is a giveaway to the major institutions. It could also create a self-fulfilling prophecy. The incentivization could trigger sudden, large-scale withdrawals that could easily tip into bank runs if a panic, hard mentality kicked in. Thought position, but with all that set, I don't think the government has many choices - that said, I probably would announce a full backstop of all future bank insolvencies for the remainder of the year, immediately convince an emergency session and encourage Congress to swiftly pass a bill that would raise the FDIC insurance limit to 10,000,000, and I would have the fed open a lending window to all the banks in the system to access ample liquidity (letting banks swap out assets with investment losses for a period of time in exchange for cash at par value of the investments - 100% of the initial value of the investment - which would give the banks enough cash to orderly manage any withdrawal requests and go a long way in preventing future panics. 

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An interesting note about this has it does have a very faint connection to a bank that many of us use, is that after SVB and First Republic first started to wavier, a consortium of major banks (Goldman Sacks, Bank of America, Citi, Wells Fargo, JP Morgan, others, - and one we know locally joined them, PNC) borrowed money from the financial markets and deposited their new cash into deposit accounts at First Republic to sure up their cash position to help manage withdrawal demands and instill confidence in the business. Unfortunately, that has not worked out well, and it will be interesting to see how those deposits are handled. If there are losses in the event the government does not backstop it, what size losses will those large banks incur a billion dollars? More? We will likely find out by Sunday night. Ironically, those losses might scare depositors and trigger withdrawal surges at the big banks. However, as I understand it, the banks have ample cash and liquidity to meet new demands. One thing is for sure, the president and his team must be very angry. It’s not a good look to have banks fail under your watch or bail out major companies that face investment losses due to perceived mismanagement. I hope this was informative! Share if you enjoyed it or leave a comment - I’m happy to answer any questions about this situation or the banking sector and financial markets in general.

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The risk of PNC or counterparties with custody of City cash balances going insolvent is extremely low. PNC, whom I assume holds the city’s deposits and is the probable agent referenced, is a bank approaching Too Big To Fail status. The Federal Government has made it clear that while regional banks can be seized by the FDIC and see potential losses for depositors over the FDIC limit, large institutions that play important roles in our financial system get different preferential treatment. In a bank-run scenario, the Federal Government would likely deem its failure a systemic risk and outright guarantee deposits or strongly (some could say coerce - this happened in the 2008 crisis when banks were essentially forced into buying failing institutions) recommend that another, larger financial institution buy its assets and assume its liabilities (deposits) which would make depositors whole. Given the recent regional bank turmoil, I thought it was worth noting. The investment fund’s assets are well above the $250,000 insurance protection and are also exposed to potential loss if the financial partner fails). It is also worth noting, to rebuild some confidence for anyone reading this who might have worried about the revelation that nearly all the city’s cash was at risk, PNC was one of the partner banks that contributed cash as new deposits in one of the banks that recently ran into severe difficulties, joining the likes of Goldman Sachs, JP Morgan, Citi, Wells Fargo, and would never have taken that action if it wasn’t highly capitalized, liquid, and able to meet any withdrawal demands. In my eyes, this was their purchase price into the TBTF club and placed them under the blessing of the Federal Reserve and Treasury Department, making them a critical institution.

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PNC is significant, but the other banks mentioned are significantly bigger - but that doesn’t matter. PNC is big enough to get

special treatment. If that’s fair is a whole other debate, I would argue not. The thing is, if confidence starts collapsing in banks, the fear spreads rapidly, and other banks which might not have had issues would suddenly be met with a huge amount of withdrawals and find themselves in a bank run situation, and this would spread throughout the total financial system, and the whole system would come down. The US banking system relies on fractional reserves, meaning that banks essentially lend out your money multiple times, assuming that it is highly unlikely that all depositors would demand the return of their money all at once. So when you invest $1 at a bank, that turns into $5 of loans. Managing this balancing act is called asset liability management. Due to this system, confidence is critical so that people don’t rush to pull their assets because if they do, there wouldn’t be enough money to cover all the deposits. So if a bank like PNC failed, confidence in all larger banks would quickly collapse, and you would look at a 2008-like situation or even worse. For those that don’t remember, the 2008 recession that started as a financial crisis turned into a full-blown recession that destroyed property values, collapsed the stock market, caused massive unemployment, damaged municipal balance sheets and pensions, and led to nearly a decade of very low, below-trend GDP growth. You could also argue it set the stage for the current banking (mini) crisis, as the zero interest rate policies put into place by the Fed to help reverse the recession had to be kept in place up to the end of last decade, and the system became heavily reliant on those low-interest rates. Now, with the Fed increasing rates by 100s of percent, business, and investment models are failing. 

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Concerning PNC’s position, it’s more than just an issue of depositors losing money. The bank goes beyond “traditional banking” - holding deposits and making loans. They are a prominent participant in the capital markets, serving as a counterparty (someone you enter into a financial transaction in which there is some form of obligation from one to another) to many other institutions. Financial institutions participating in the capital markets would default on counterparty agreements in a bank run and insolency situation. If PNC failed, it wouldn’t just be depositors taking a big hit; it would be other banking and financial institutions who trade with PNC and suddenly find themselves holding worthless trading positions, which is a situation that could dramatically spiral into a financial crisis. This is why it’s very likely classified as a systemic institution by the federal government. It is a significant counterparty to many financial institutions, from banks to corporations to insurance companies. Its collapse would wreak havoc on other financial institutions’ balance sheets, leading to even more significant insolvencies that spiral further and spread across the system. The government makes the bet that rushing to provide guarantees to large banks and telegraph that behavior as soon as there are signs of distress in the banking system will likely cost far less than what would happen if the fear spread and suddenly lots of banks are facing bank runs, and you have large scale insolvencies. A situation like that would set the country back years and result in very painful conditions for everyone, rich and poor. But just by suggesting they will backstop large banking institutions, it prevents bank-run scenarios by giving depositors confidence that their money is safe.

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In summary, the City holds a lot of cash in deposit accounts at a bank beyond the FDIC insurance limit, but they say the cash is collateralized. Additionally, even if some crazy events led to turmoil at its banking partner, which I presume is PNC, there are several reasons why I don’t think there is even a remote chance of issues with uninsured deposits. If the bank ran into issues, it would likely search for a buyer of its assets, generating cash to cover deposits. If that fails, they would likely find a strategic partner to buy the bank and assume assets and liabilities. And if THAT fails, at the end of the day, as a major banking institution, as the federal government and its representatives have made clear, it will not be allowed to fail, and the FDIC, Treasury Department, and the Federal Reserve working together would guarantee all of its deposits. This was long and somewhat complicated, but I thought it was an interesting tidbit about the city’s finances and an excellent opportunity to explain a little about banking crises and the federal government’s policies regarding bank failures. I hope you found it interesting.

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(one thing unclear to me from the source documents is that $117 million is listed in the city’s checking account, but I am unsure if that includes the component units such as the Erie Metro Authority, Parking Authority, etc. To present the information, the Erie Metro carries $9.6 million and is backed by collateral held by a custodian as required under Act 72. The Parking Authority carries $10,741,929, which is also collateralized. The Parking Authority carries 1.95 million, is not collateralized or insured, and is held by a Broker Dealer (securities account). Finally, the Redevelopment Authority carries $93,597. I’d be interested to know if that is included in the $117 million figure or could this additional cash also be earning interest (admittedly, for the amount listed, it might be more trouble than its worth, even if all of it was invested in 3-month treasuries its only about $400,000 for the two authorities with ~$10 million. But hey, leave no stone unturned, right?

Thanks for reading, and if you thought this was informative or interesting, please share this page or comment below. It all helps spread the content. If you have any questions about what was covered, more detail on the data, or any other items you want to discuss, drop a comment here or on social media. I’m happy to have a conversation or answer questions.

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1. Sell the golf courses, and auction out awards based not necessarily on dollar amount but rather on the quality of the development plan. City development through divestiture.

2. immediately shut down the printing shop and contract the printing work to a local business.

3. city star selling city-wide annual parking passes. This has been done in other cities, but small, whose data shows this boosts revenue as people are likely willing to overpay a bit what they would have paid via meter for the convenience, less administrative work with parking tickets, and increased city visitor traffic due to convenience. Love parking tickets to digital tickets and managing ticket payments in a modern database that records tickets and processes payments online. Create a tiered meter ticket system where habitual repeat violators see escalated fines.

4. merge city departments such as the Bureau of Engineering (traffic engineering) and the Bureau of Streets, lowering administrative costs. Also Bureau of Buildings and the Bureau of code enforcement.

5. Restructure the investment fund to a better risk mix and adopt a risk parity model - using slight leverage with very secure fixed income to boost return while actually lowering risk profile.

6. Refinance bonds to a longer sloping structure while entering into interest rate swap agreements with banking counterparties from fixed rate interest payments to a floating rate, thus benefiting from inevitable interest rate declines (maybe even this year). This lowers the interest cost of the bonds and doesn’t lock us into current high fixed rates. Borrow capital for investment fund on a floating rate basis at 4.75 or less and allow capital to grow in a fixed income/corporate credit / private credit fund that grows at 7%+. There are plenty of very low-risk credit opportunities on the market. Private credit can see yields north of 10%. For context, the city pension grows to around 5%. With this in mind, it might make sense to hire a proficient financial manager to oversee these programs and who could work as a co-manager with pension funds. The city has a lot of room under the borrowing cap to issue more debt instruments to fund local investment. Expanding on that, it might make sense to hire a very proficient financial manager to oversee these programs and who could work as a co-manager with pension funds – creating a Chief Financial Officer (nonpartisan) position with a small, highly skilled finance department overseeing financial matters, investments, and potential financing and related programs mentioned later.

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7. Make PNC compete with HSBC for city business.

8. Adopt a cloud-based IT stack, moving city data storage and services to AWS or Google Cloud. This does several things; it lowers IT admin costs as server maintenance and management are offloaded to the cloud provider. It makes the system (ironically) more secure as the AWS/Google DevOps teams continually. It also actively manages security patches and security; it dynamically resizes as data needs change, reducing unexpected costs and severe equipment demands as the system grows.

9. Work with other municipalities through joint municipal authorities to leverage the scale of economies by bundling various goods and services into joint purchase orders. This can be done with insurance costs, better rates from financial managers, lower equipment costs, and cheaper IT services.

10. Work with the various municipalities to standardize financial reporting with a modern system that makes data analysis seamless. A city with data can make better decisions.

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11. Expanding on that, work with the county to develop a data program where city residents and management can continuously update and add information about the city that all can access and use for decision-making and analysis. For example, input all 911 calls to the GIS-based data platform, allowing police to use AI technology to smart route patrol routes so that they are in the right spots and time. This also helps developers as they make investment decisions. It also helps sell the city by making business opportunities clear in the city.

12. Controversial, but on my wish list: sell city hall to a development company to build high-quality prime real estate housing on our Central Park. Jail should not sit on what should be some of our most prime urban real estate. Relocation sites include central city mall, which would pull economic activity (new businesses would move to this area to support the new labor base) to a large city section that has long been under-served and utilized.

13. More rigorous solicitation/purchasing decisions. I’ve seen too many equipment and service purchases that have paid a substantial premium (computer purchasing etc.).

14. Continue moving street lights and other equipment to low-cost LED.

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15. Block contracting for infrastructure work on a spiral contract. This means instead of each year contracting for road work; for example, you would issue an RFQ for multiple years of service on a cost-fixed basis and update on two-year cycles. Work and contract jointly with surrounding municipalities for larger order sizes and benefit from scale. Also, in conjunction with city data being readily available about road and traffic conditions, this would improve traffic flow as construction work can be planned around routes.

16. Expand grant writing capacity. Lots of money out there from other governmental bodies and nonprofits. Explore nonprofit programs by enterprises that could be used for purchasing.

17. Expanding and cooperating with the county (similar to working with the county and other municipalities to standardize and share data) to adopt a shared data system where assessment records are dynamically updated when permits are filed. Encourage and petition the county to initiate a new county-wide assessment. If they decline, investigate returning city assessment power to the city (unsure of legality). Another option would be bringing a lawsuit to court challenging 10-20 randomly selected properties that are highly under-assessed and petitioning the court to order a new assessment from the bench. This has been done in multiple counties across Pennsylvania.

18. Stricter code with standards for materials.

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19. Work on solutions to retire pension commitments through buyouts and other solutions (Unsure if state / local law allows for this, but it’s worth investigating).

20. Review service contracts and expand the bidding process for administrative and legal services, such as paying firms to challenge assessments. It might make sense for the city to have a small legal department to handle this and advise on other legal matters.

21. Continue modernizing systems for residents to interface with services, permitting & licensing.

22. Adopt a customer service mentality by creating a resident liaison office for residents and businesses to access services. Move everything online. Internet service is now universal; end physical processing of financial transactions and install digital kiosks (similar to those in airports or advanced ATMs) for processing payments in city hall, which reduces headcount and future administrative costs.

23. Recruit and create a city ambassador program for a small team that attends industry conferences for industries with a natural fit with Erie to interface with executives and decision-makers to recruit business to Erie. Chief recruitment officer charged with selling the city to new enterprises/start-ups. Reach out to regional venture capital and angel investors who can sway start-ups on locating their business. Offer subsidies to start-ups for internet service using the relationship with VNET to provide lower-cost high-speed internet access.

24. Create a financing program for property renovations to provide low-cost financing options for property owners to improve the housing stock. This could improve the cityscape and quality of living and produce a revenue stream for the city. Also, an alternative would be to work with local banks to create a program where the city, for an underwriting/administrative fee, serves as a joint financing partner with the banks to provide backing for loans for building improvements. Bank originates the loan, and the city provides a portion of the financing and receives interest.

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25. Lower base property tax rates and increase income taxes for rental-related revenue. (Unsure if this works under state law). This moves the tax burden from property owners to income-producing/cash-flow-positive properties. This could be done as a fee rather than tax, but same idea. Get property taxes harmonized or competitive with surrounding municipalities.

26. Sell underused/nonproductive assets.

27. Create tax incentives and financing programs to help encourage enterprise/business owners to locate in the city. Reduces up-front tax rates on business revenue and building construction financing. Designate enterprise zones with benefits and subsidies for enterprise - specifically in the additive manufacturing / advanced manufacturing industry.

28. Not sure if this is done but purchasing monotone insurance where insurance guarantees our debt instruments, lowering rates.

29. Work with nonprofits in the space to create city greening programs for city planting/gardens and create codes requiring new developments to include a greenish plan to improve the cityscape.

30. Solar panels on city buildings to help lower utility costs.

31. Aggressively!! Pursue property tax/PILOTs with UPMC and other large institutions.

32. Improve automation and technology options to increase efficiency and reuse labor load and city hall payroll.

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33. Institute more police walking patrols where crime and vandalism are elevated.

34. Chief innovation officer charged with continuously reimagining ways government works to improve efficiency, services, and lower costs.

35. Expand universal public Wi-Fi and sell a city pass to access wi-fi.

36. Licensing requirements for telco installations.

37. Excavation permits.

38. Licensing for processions through city traffic – such as funerals (charged to funeral home). Likely unpopular, but the point of this is to discuss potential revenue sources.

38. Congestion fees for the city traffic. Though a much bigger city, London instituted a congestion fee and generated over 100m in the first year. This could encourage more public transportation, generate revenue, and reduce unnecessary commercial movement.

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39. Fees on eye-sore properties, vacant properties, and car lot properties that detract from enhancing city beautification and producing revenue.

40. Fees on large advertisement installations. These are more or less ugly and a good source of revenue.

41. Create a property management department to strategically maintain and keep abandoned/seized property to sell assets above court sales levels. If we believe our plans will work, city land will appreciate, and it may make sense to hold onto properties for future appreciation. Maintain property ownership and offer long-term leases for construction rights. Strategically purchase and lease properties that have sat on the market for an extended period and can be purchased below market.

42. Improve the collections process for tax revenue to stop leakage. Create financing plans for delinquent tax payments.

43. Red light cameras and enhanced mail ticketing for violations.

44. Food waste disposal charge on a volume-weighted basis.

45. Small surcharge on tickets at large venue events that cause large traffic issues and occupy the streets.

46. Work with the school district to identify ways to share resources and work together on equipment, utility, and service acquisition.

Anyways, enjoy. Would love to hear more ideas. Not enough floating around, in my opinion.

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Businesses that rely on ultra-low latency and bandwidth will flock to the area when fiber comes. Then, those already here will improve their performance due to a faster network and excel ahead. Finally, new and unknown players will quickly emerge with something potentially out of the left field that none of us see coming. That breakthrough could rewrite the book for Erie. Brilliant technologists and college students with computer science and engineering training are hyper-aware of where the best fiber connections can be found. They aggressively hunt out low-latency systems. Well, let’s put them on notice. We have it and support their mission to make something incredible with it.

This also extends to finance. When you trade stocks, your orders are bundled, transmitted, and compete with countless other market orders when they are submitted to the exchange to complete a buy or sale. Still, your order is placed in 45 out of 81959 other orders. That order is primarily set by latency. If breaking news hits the wires and you want to buy 100 shares of the SPY500 at 414.35, and you think you have it nailed, knowing that the information that just broke will drive the SPY up another 50 basis points. However, in your excitement, you missed the message on your trading platform that your order could not be executed. The security price moved beyond the range established by your trading order. Why? Because amply capitalized institutions and well-funded professional traders lease space in the same data centers as the market centers themselves, and as a result,  their orders reach the market-making servers before any other order, especially one coming from far away with lousy latency and poor connection.

Think of it this way: a trader in Sioux Falls sees mispricing in the stock of Apple – every time the stock has dropped 5 points, rallied back, fell another 5, and then rallied back again, a 25-point drop quickly followed it. So, you have a trading thesis in place. Let’s say another trader living in New Jersey sees this pattern who lives a block away from the actual NYSE data center where trading happens (yes, the NYSE is in NJ). He will immediately fire off an order to sell Apple at the top of the rally taking as many shares as possible going short. Our friend in Sioux Falls might place a trade right around where the price was when the trader in New Jersey placed his order. However, because of his proximity to the NJ Market Center, the NJ trader got filled and reaped the reward, while the Sioux Falls trader missed out on the trade. By the time the data trickled all the way to his platform, the move was already over. This result was solely due to the logistics of information and speed. 

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Fiber might not have completely fixed this issue, but it would have helped make it a more even fight. Let’s say everyone has fiber. Your information will be more up-to-date if you are on the server where the good, or stock in our example, is being bought or sold. But Fiber makes it a much fairer fight. I can tell you, as someone conducting business in Erie in the capital markets, latency DOES impact me, it DOES hold me back, it HAS cost me, and with regards to the large datasets involved in my work, the bandwidth available to me via Spectrum creates a severe bottleneck. I want to stay in Erie, but I don’t know how long I can be on equal footing with my global peers without technology. That’s a very sad state of affairs, as I prefer the opposite scenario: I want to start a capital markets firm here in Erie and encourage traders to relocate here to make good money, live in a laid-back environment, and have an incredibly low cost of living relative to where they’ve been. Still, none of this will be possible without something as simple as reliable multi-gig fiber. Other issues might prevent my dream of trying to turn Erie into a capital market hub from coming true, but this is the one that has my attention for now.

Widely unknown by those outside the finance industry, the NYSE no longer operates on the “NYSE.” The NYSE of Wall Street fame is nothing more than a showroom for CNBC. Very little actual trading takes place down there. It’s pretty sad. I once upon a time interned there, there was still a few trading pits, but this was in ‘07, and those years were really the last days of a proper stock exchange complete with trading pits and shouting brokers. The rowdy pits of the Exchange symbolized a once-booming era, which is now essentially over. A new symbol of the following generation can be seen in the iPad and other high-tech devices carried around the exchange floor - as if the last of the remaining market makers needed a reminder that a $700 Apple device ultimately cost them their job. That job, in most cases, was likely inherited and handed down from grandfather to father to son.

Just one last passing shot at making clear that we’re in a new era of digital engagement in the financial markets: the current digital generation has taken the reigns. It runs the show while also enjoying a wide-open horizon with no threats to speak of. Of course, that’s not entirely true, as one major danger lurks beyond the bounds of current financial practices. We will revisit this once the first or second revolutionary AI systems emerge. Leaders lead until they don’t - feeling confident today and believing you’ve reached the top of the atlas is a dangerous attitude. AI has a lot in store for the financial markets, and how many laypeople can fully participate at the high end? Regardless of its direction, increasingly, large banks are colluding to drive well-funded trading systems to prey on market centers. The power of HFT is incredible, and I shudder to think about what will be possible once these large AI language models tap into financial markets and start training on that data.

All I can pray for is a gentle reign filled with fortune for all and a low entry barrier for those wanting to get involved. But before we go all AI, it’s worth acknowledging the change that’s taken place already. A once-significant era is no more; a new era of digital engagement has surpassed the highest peaks of the previous boom. For those looking, there are many signs of the emergence of a new digital age: electronic trading, the new frontier. As it happens, most US stock market activity occurs in New Jersey, and all the major market venues are stationed in a roughly straight line headed south down New Jersey. You could easily take a car ride up the coast of New Jersey and drive by each one. This information would likely surprise many (including those in New Jersey), but how many people knew we had over 15 stock market exchange centers? With all that said, despite the proliferation of electronic trading, the reality is that if you want to get close to the beating heart of wall street and finance, lower Manhattan is still the place to go. Exchange Place is a sight to behold, and for this writer, the NYSE evokes a sense of patriotism, pride, and optimism about the future of this country. Once you see the REAL NYSE, a drive down the Jersey Pike has more context. That ride will take you by all the “real” stock exchanges or, maybe more accurately, market centers. Still, you would never know it from looking at the buildings - windowless, foreboding buildings with barbed wire, spotlights, and enough armed guards to put down a small revolution.

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The destinations for market orders are the “trading venues.” The venue is nothing more than a server on a rack and many other servers working in tandem, processing vast amounts of data and routing trading orders from every direction possible, finding and matching buyers and sellers worldwide in real-time while maintaining an accurate pricing history and quotation function. In short, trading venues exist on servers and their network equipment racks. If I’m an intelligent quantitative trader and created an HFT (high-frequency trading, a style of investment trading where orders are executed lightning-fast for tiny gains of a few pennies, done by knowing what orders are being sent to the stock market exchange where trading is taking place and, by using their high-speed technology, can get an order in to buy or sell the stock before you, forcing you to pay a premium to buy or sell the stock from the HFT trader. This strategy is highly competitive amongst the best trading firms on Wall Street, very expensive to execute, and highly profitable) or another algorithmic strategy that I thought was going to make huge profits, I would absolutely pursue seeking financing from wealthy friends and savvy lenders familiar with the practice to raise funds, funds which I would then use to secure myself a well placed, low latency server, close to the market center where my product of choice trades, which issues the buy and sell orders based on the signals my algorithms generate and execute in the very same datacenter, likely just a few racks over. The only problem is that the cost of leasing a server in one of the data centers where market centers are held easily runs into the very high thousands to tens of thousands. This should not be a surprise when you understand how much money can be made with a trading system with a winning strategy and next to zero latency. With the right software running on your server, you effectively have a right to print money. Going further, some market centers credit you for “providing liquidity” on certain exchanges by buying and selling securities at the “bid” or the “offer,” a process that can be executed in such a way that the market participant barely takes on any investment risk and solely captures the market center rebate for providing liquidity. So theoretically, you could have a program that constantly hunts for stock listings with low current liquidity. By routing an “offer” to that exchange, the trader is issued a rebate for “providing liquidity,” even if the trade order had no economic value other than simply filling another trader’s order. This filled order can be immediately liquidated, neutralizing any market direction risk and isolating the rebate as the profit driver. Certain groups run programs around the clock solely to capture rebates. Sadly, from what I understand, the practice can be pretty profitable. 

My type of trading is straightforward. Once I begin, my orders go to the servers. They are instantly matched with a corresponding buy or sell order, resulting in trade execution. Now, all that’s left is closing the trade. Assuming the market rallies .50%, selling the market and pocketing the difference would be reasonable. That, in short, is the essence of an outright trade. However, much more happens after this point when it comes to trading, especially for institutions, but the issue for this example is that the trade itself is over at this juncture. You can leave it to your broker and clearinghouse partners to ensure the money from the trade is in the right place and that any newly owned stock finds its way to your custody. That’s a job for your broker and the clearing agent.

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Regarding latency, it doesn’t get much better than integrating your trading server with the network, real estate, equipment, and data pipes that the market exchanges you are trying to trade on use. I am not exaggerating when I say inches and milimeeters mean life or death, or 1ms latency vs. 3ms latency means one survives and the other is toast. Businesses maintain and operate in a fiercely competitive environment where they constantly push the envelope on the time constraints and mechanics of clearing and trading processes for the markets so that they can push their orders to market much faster, sometimes in the 1-2ms range. Even more perversely, due to the high-frequency trading, the nature of some of these players in the market, and the geographic discernment of exchanges across servers around the country, lead to sophisticated HFT traders seeing your order coming down the market pipeline as your order hits market center aftermarket center and that HFT trader bids the price up a touch by buying some shares of the stock you are trying to buy, knowing full well your order is coming, which in turn forces you increase your bid, and of course, when you do, the HFT trader liquidates the trade in a microsecond, capturing the value remaining between the price of the security paid before your order arrives and the new prevailing market quote after your order executes and drives the stock up a tick or more. HFT traders are totally content with capturing a tick to a few ticks at most (the smallest movement a stock can make is a tick, or more simply, it’s a print of a recorded trade on the market, a minimum of $.01). With reasonable capitalization, for the HFT trader/system, that tick could be worth anywhere from tens of dollars to far more. But what supercharges them is that they don’t take bathroom breaks. They can do it all day long throughout the trading hours, and as its all algorithmic, a computer identifies incoming orders, trades in front, allows the incoming order to lift the stock (after it bought shares for slightly less before the order hit the exchange), and liquidates the position, all in the matter of mere seconds, at most.

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You make these small incremental trades enough times a day across enough markets, and you will start to make serious money. All that is required is incredibly low latency and some good programming. The odds are that an HFT trader is likely an algorithm, not a real trader. However, it’s very plausible that a trader overlooks and manages the algo, but the actual thing doing the trading is likely computer generated. In a given scenario, say that algo pulled that stunt mentioned above 10000 times daily. He bought a stock before another person’s order could reach the exchange and then sold it immediately after the order hit the exchange and lifted the stock price by a penny or two. It might seem like a little nuisance, someone sniping a penny or two from your gains, possibly just a cost of doing business. Well, if he made that trade 10000 times a day, with each HFT trade capturing two ticks (two price second by second price movements), or $.02 per share, with a total of 500 shares per trade, our HFT trader is grossing $100,000 a day. With roughly 252 trading days a year, our HFT trader would have yearly profits of $25,200,000. And that’s just the start!

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HFT traders are well funded, so they could jump in front of the line coming in, given their latency advantage and ability to see order flow coming from further out exchanges, and slide an order in, say 500 shares at AAPL, to make a few pennies. In this scenario, Apple is at $155.55, and an HFT sees an order coming for $155.58; using HFT, they would quickly buy Apple at $155.56, and knowing your order is coming, sell it to you at $155.58, capturing 2 cents on the trade. That occurred in a few seconds, so 2 cents might not seem small. Still, when you realize the whole trading day is 6.5 hours, that means there are 23,400 seconds that the HFT can operate in, leaving more than enough time to reach the 10000 trades from above, especially when you remember that over 6,000 stocks are trading at any given time, each with their own 23,400 seconds of opportunity. For the entire day, this quiet HFT operator could be snipping a penny or two every other tick for the day. Just some quick math, let's say that our HFT trader made up .002% of Apple's trading volume (66,485,773). At .02 per trade, with 132,971.546 shares traded, that would leave him with 265 opportunities to scalp 500 shares for .02 cents. With that small percentage of total volume, this HFT system is still generating $2,650 a day in microsecond transactions. Not the end of the world, but I can assure you that the scale and volume of HFT is far more than .002%.

The only way we can compete and keep this market honest and fair is to ensure all market participants work from a dedicated fiber optic line with very low latency and substantial bandwidth. So you can see the opportunity for this type of parasitic trading. One thousand micro trades a day seems very small, but if our algorithm or trader trades around 1000 times daily, each trade profiting $300 dollars, then our modest HFT trader makes about $75,600,000 a year. Realistically, HFT systems trade more than 1000 times daily, and most HFT traders are concentrated at the same firms. Firms that can afford astronomical networking costs. Firms that could afford to lay fiber lines from New York to Chicago on their own dime to engage in this type of trading. Now you can understand why firms like Citadel and others have only had 4 losing trading days in the last year.

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Think of it this way: you are trading in an open market. Still, the guy with the fastest ability to connect to all market participants at the exchange sees your trade order, whether buy to open or sell to close, and can choose to front run your order to buy or sell, putting you instantly in the red. This is, at its core, high-frequency trading. Sometimes even seeing the market aggressively taking the other side of a trade before you know what’s happening is a sign of HFT, leaving you to fight for scraps after the move has primarily been made. Those with low latency and high bandwidth are out celebrating. At the same time, you’re still stuck at work trying to figure out how the perfect trade fell apart. Could it be the technology or, more specifically, the speed of my network? Yes. It absolutely can.

My apologies: I went too far into HFT and Latency and the impacts on trading. Still, entrepreneurs and businesspeople in Erie need access to this beautiful technology. Whatever is in the way must be pushed aside; the people want it. Vnet should want it. I can only imagine the revenue of having a fiber monopoly on a city of 100,000 people and a metro area of far more. The local government likes it (it provides an excellent service with the added benefit of being something to brag about for the region, after all), so I’m at a loss regarding the hold-up. This should be considered a top priority. I’m very familiar with neighborhoods that have offered to pay for the installation costs of laying & installing the fiber to get access to it. So, a great product, check. A business with a profit motive, check. A firm should rationally want to expand and increase profit, check. Customers willing to subsidize the cost of building out fiber to their homes, for which they will pay hefty fees for many months, check. That’s many checks. So, with all that, I’m trying to figure out what I’m missing. I would love to know what Vnet is thinking. To be fair to them, I have not seen anything written. But if customers are begging to pay for installation costs of the very fiber they will be charged heavily for.. then I’m sorry, failure to roll it out rapidly is a business failure. Given all the above, I can’t think of a good reason for a hold-up.

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How would you handle the following circumstances if you sold custom cars and had engineers? I was willing to bring tires, a chassis, an engine, an exhaust, everything else that comes with building a car, wages for the labor it would take to assemble it, and their benefits. Would you push this order off and ignore it? Or would you clear your schedule and say, “You know what? We can get this going very quickly. Will you be ready for pickup in three days?”

I want to ask for transparency. I have been requesting a timeline on when my home would be eligible for fiber for years, with a vague promise that it’s coming soon. Well, it’s been soon, so I want to see where we stand, how close Vnet is to expanding its footprint, and when a realistic timeframe is to anticipate having Vnet offerings. Is any more information needed from a neighborhood to show broad buy-in to the offering? What type of capital commitments is Vnet looking for? Long story short, I need that low latency. Yesterday. And I’m happy to do whatever I can to finish this quickly. As mentioned, it is sincerely desired, wanted, and necessary for many business models, including for this writer. Show me where the delay is or what is holding things up, and I will focus all my energy on helping remedy the delay. Unless a bank collapses, I must return to work, but I’d like to make some progress between now and the next bank collapse.

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For readers that may not be familiar with the new AI systems, here is some background on what they can do. For general understanding, these AI systems can be prompted to write any number of things, ranging from highly technical to catchy songwriting, to introspective poetry, complex essays, summaries of user text, and much more, at a very high level. On your first use of a sound AI system, such as OpenAI’s chatGTP, you will likely be left stunned and possibly a little concerned. They can reasonably understand and respond to advanced queries. They can edit material, and they remember the history of communication with the user so that future answers can be improved. They can be used as search engines, rapidly generating highly accurate results in the blink of an eye. Impressively, they can transform usually written English into complex computer code. This skill has rendered anyone with a grasp of the English language capable of building software or websites. I will continue with my thoughts and how to apply AI in the context of education and why it’s so critical.

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What is essential about education and AI is that teachers shouldn’t look at systems like chatGTP as a threat or a means of cheating. They are just new tools to put into teachers’ academic arsenal. They are tools that increase productivity, often quality and they mitigate the need to spend sustained periods of time on minor task level details, but rather have the opportunity to truly teach the context of the work they are doing, how you can imply the work, the industries and social settings where it’s relevant, in short, you can focus on the stuff that matters and allow trivial tasks to fall to the side It’s not a complete abdication, AI can only go so far, so there is a lot to teach in regards of how to use these tools. Teachers must teach our kids how to master these tools, not condemn them; realistically, it’s hard to catch, and worse, it pushes kids into creative ways to break the rules. You could call it the academic black market, and just like anything in a black market, it comes with dangers. In this scenario, the danger is twofold, one, your students have broken the little rules, and detected or not, it will slowly erode the wall that keeps them on the right side of the rules. Secondly, the fact that when you break a small rule, it quickly becomes a slippery slope. A lot of evidence suggests that one becomes slightly more prone to breaking big rules if one gets comfortable breaking a small one. The other issue is the student’s cost of missing out on how to maximize their leverage with these tools. Ultimately, the students will use these tools one way or another now that the genie is out of the bottle. It’s better to say OK and teach them best practices rather than sending them into the “black market,” where the teacher ends up getting substandard work quality, fails to stop them, and, most importantly, fails to help them realize their maximum potential.

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In ten years, basic copy, across any discipline, throughout the economy will be delegated to these tools. This applies to many scenarios and subjects. The future is here, and it’s not going away just because the system you understand, and are comfortable with, is dramatically different from this new reality. You are either looking backward as the metric to measure success, or looking towards the future, adapting new powerful tools to enhance the quality and quantity of a student’s future work contribution in the real world.

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You can prepare them for getting a job and excelling in the prior era, or you can have them ready to enter and succeed in the workplace of today and tomorrow. Almost all the l students in Erie come from disadvantaged. Situations. The best thing we can do for them is to educate them in a way that will give them strong, competitive new entrants into the labor market. This is how the cycle of poverty can be broken. Significant changes in how the system operates provide enormous opportunities for social mobility. While the old system had some groups at a disadvantage with limited opportunity to move up the social ladder, early adopters of the new status quo will have, if seized upon by parents and educators, the chance to leap ahead of their peers and upend the cycle of the past. We should be doing everything possible to turn them into quality candidates, eligible and ready for any high-income role soon. A future in which these tools are optimized for and their use standardized across virtually all our industries.

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It’s not as simple as telling someone to ask AI a question, and then you’re done. It goes far beyond that. There is an art and skill to using AI chatbots/tools. Without thorough guidance, it won’t make a document, solve an equation in each context, or generate code for you. If you don’t prompt AI well, it is immediately apparent when reviewing a generated response. With poor prompting, answers are very vague and filled with empty words. Prompt it well and get a solid, concise, detailed work product.

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In math, teach students what calculus or another form of math means, why it matters, what the calculations yield, and what their use applications are, i.e., how to use the math function of the AI to bring you a meaningful result and why precisely it is calculated the way that it is. Teach how to form equations and best practices in promoting AI, and then take those answers and apply them to real-world situations, such as how to use them in a specific scenario they might encounter in their future employment. Teach them the meaning of proofs, why they are essential, and how to use AI to replicate or apply them to other contexts.

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In history, help children build a framework to organize events and social developments, teach students the valuable lessons of history, and provide them a 30k foot view/macro-outlook on all human history. With that, they can fill in the blanks with details provided by an AI system. Require them to write meaningful essays with examples of those big lessons in history. In that vein, help them determine/verify the small details that can be quickly referenced. Teach them how to cite and properly footnote an academic paper. Have students find quotes from relevant historical figures, how to incorporate them into a broader text with a strong thesis, and how to use them in ultimately forming a persuasive work product.

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In science, teach students what is, and broadly, how to use the periodic table. Help them understand the components of elements and how those things can be used in scientific applications in the future. Teach them how to apply scientific details to a more holistic understanding of our universe. Teach how to form a scientific experiment report into a concise, well-defended hypothesis and its results. Like history, focus on the macro view of science as an evolving history and how to fit AI-provided micro details into a broader, more helpful context. Show how to prompt AI with specific data from a student’s experiment and guide it in forming written work. Teach them the essential science lessons and their use in understanding life and other systems.

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For computer science, show them the structure of computer languages, how objects are treated, how the system is made with code, and the best way to prompt AI to produce valid code that achieves the student’s goals. If the intended result needs to be noticed, show them how to use AI to troubleshoot and work out errors. Show them how to use AI to fix the mistakes in user-generated code and how to leverage those tools for a dramatic increase in both qualities of code and productivity. For example, one student could traditionally complete a simple coding component of a larger product in an hour or two. With AI, one student can complete the whole project, producing what a team of 5 could have in that same timeframe.

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In writing, teach students how to form a thesis statement and organize new facts into a persuasive document. Teach them how to structure quotations and apply details provided by AI. Teach students to follow up on that information and properly reference and cite authoritative sources. Show the best practices for structuring AI-generated copy and knowledge snippets in a well-formed and argued paper. Educate the basic grammar and structuring skills needed to modify AI-generated work so that a student is prepared to make manual edits and review the quality of the AI-generated material. Teach them to recognize good writing and understand why it’s good.

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Teach them critical general tenants of the writing process and how to best incorporate them with AI solutions. Shift the time allocation from focusing on tiny minutiae to, instead, creative work. This work is still very human, and exercising practice in creative thinking/work helps learning and growth in many ways. AI will alleviate the burden of technical writing, but it will never have the human ability for spontaneous, creative thought. It may be one of the last refuges of life that remains very human. This thinking should be promoted and fostered with more classroom time, using time gained from sourcing laborious writing tasks that can primarily be entrusted to AI. 

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In border life lessons, show students how to query and take meaning from information provided by AI. Help them determine how to structure and optimize queries to the highest benefit and then how to apply critical thinking to understand and assess the quality and validity of AI-provided answers. This is especially true now with so much “misinformation” propagating online.

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Teach students how to think critically and what tools / how to verify information that can, and often does, gets manipulated by bad actors with an agenda. Show them how to use primary source documents about the information AI provides. These are incredibly invaluable skills in the new economy/society. Use the newly freed time to teach students how to apply those lessons to media in general.

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This will occupy each subject area in due time. We should encourage the earliest adoption possible, as it will position our kids ahead of the crowd in the mastery of tools that enhance both the quality and quantity of work products. Everyone will eventually be educated this way, with AI woven into every subject and the blunt realities of what it means regarding basic writing tasks. However, for now, it’s still early days. That means there’s an opportunity to jump to the front of the line. We have that chance; we must commit and follow through with it. Students should be equipped with iPads or laptops as soon as possible. Being able to work with a computer is already an essential skill, and due to many families not being able to afford a computing device or internet connection to use it, our children are falling even further behind.

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Missing the boat on the opportunity the AI revolution is creating would only compound this problem even further. If this opportunity is missed, I fear the possible consequences. Social mobility is, sadly, already a profoundly steep mountain, and if this new world is not well prepared for, it will only become exponentially insurmountable. That truth is a function of the reality that the gap between those who can and those who can’t is dramatically increased by learning and adapting new systems. Ultimately, this leaves the group that can’t behind, relegated to the lowest functions of the economy, if any exist (which in due time, I believe, will be the case. In my lifetime, I expect to see almost all basic labor being replaced with AI/automated solutions). That circumstance significantly constrains the financial capacity to buy these new technologies, hindering a real learning opportunity. It also doesn’t allow for any time to self-educate oneself, let alone teach the next generation the skills to catch up or get ahead. Meanwhile, the group that “can” and the world will accelerate forward and never look back. We can’t slow this dystopian reality from coming to fruition. This tech literacy and proficiency gap is, in my opinion, a more significant problem than the wealth gap.

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The wealth gap is a snapshot of current financial ability, quality of life, and adaptation capacity. The information gap is a snapshot of one’s future economic power, quality of life, ability to adapt, and the opportunity to adjust. In one sense, the wealth gap is a static fact about now, while the tech gap is a proactive force about now and your future opportunity. This reality is a result of the lack of capacity to adapt and the chance to adjust, all of which leads to a lower quality of life, limitations on what one can do now and, in the future, and the capacity to move from the bottom half of the wealth gap to the top half. More simply, the wealth gap is now, while the information gap is about the wealth gap tomorrow. Due to all this, I believe the knowledge gap is an even more severe dilemma; it is directly relevant to addressing the income gap. It also impacts every other aspect of life, such as primary navigation in society or the ability to connect with people over an extensive network, a significant source of opportunity.

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Technology is at the heart of communication, productivity, mobility, entertainment, and nearly everything else. With the pace of AI adaptation and its rapid evolution, it will quickly become a broad, critical, overwhelming technology component, with few areas untouched. With education and preparation for basic and advanced competency in these areas, students are destined to be second-class citizens relative to their peers who were correctly educated in a technological application. Those educated will excel and exponentially advance, leaving those that weren’t behind in different world trapped back in time (further compounding this is the earning power advantage capital has over labor as a result of capital’s ability to generate new wealth much faster than wealth could ever be built up through manual labor, but that’s a topic that deserves a more concentrated, thorough examination in itself). Few areas in our society are more pressing than this developing reality.

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and the banking system's asset & liability management completely failed.

It is the issue of deposits and balance sheet holdings where a regulatory duty was mishandled. Allowing a situation where 93% of depositors were above the FDIC-insured level was highly irresponsible. So was not keeping an eye on deposit levels that exploded directly due to huge fiscal stimulus, zero interest rate policies, several hundred percent increases in the money supply, and a dramatic increase in the cost of borrowing. Most blame can be set at the feet of a decade-plus era of easy, cheap money and an incompetent central bank.

This bank crisis took several unprecedented developments in the economic system, ranging from a dramatic fiscal policy, a pandemic, a risk asset valuation boom, historically high inflation rates, and a rapid collapse of treasury prices. This was a freak situation (though preventable with more rigorous oversight from the Fed) that even the best risk model could be understood to miss. There was no historical precedence to model against and certainly no reasonable foresight to see a collapse in treasury prices. Treasuries are (essentially) risk-free, so I can understand why this was missed from a bank manager's perspective. This wasn't a result of major risk-taking in poorly understood securities like in 2007-2008, where banks compounded leverage and concentrated it into highly complex derivative positions.

No past US regulation would have prevented what took place at SVB and elsewhere. There was never a regulation against concentrated holdings of US debt obligations. In fact, regulators look for and consider treasury holdings as a net positive, not a potential risk. In the current regulatory framework, and historically, treasury obligations, in any duration, are considered the gold standard for low-risk holdings.

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That said, despite what I've said about treasury debt, those at the banks should have been hedging their interest-rate debt more thoroughly. Ironically, given interest rate swaps' reputation as risky trades, their absence helped lead to the current situation. If you hold billions of debt for a long duration, you know you have to partially hedge the interest rate risk it comes with. I.e., enter trades that reduce the possible net gain/loss on debt holdings when rates change. That is really where blame can be laid at the bank's feet, carrying on with an assumption that interest rates would permanently remain at the zero bound, and that US debt was risk-free and immune from price collapse. That interest rate hedging could be completely thrown to the wind (the Fed more or less encouraged this belief through their policy actions and communications over the last decade).

This was not a regulation law issue. This was a three-part issue. The first issue is a series of unprecedented events, starting with a pandemic and continuing to extreme monetary and economic developments. The second issue - is very badly handled management of matching assets, liabilities, and duration. Those first two issues were then allowed to metastasize into, as we know, a banking disaster. This resulted from a third issue, a failure to implement regulatory safeguards put in place to protect the system. Those regulatory safeguards are (theoretically) imposed through the oversight duties entrusted to the Federal Reserve. The Fed is given substantial power to meet those regulatory requirements. They have weeping powers over the banking system, from outright seizure of private banks, revocation of banking charters, the right to shut banks down or restrict deposits, and the power to force balance sheet adjustments. Those regulations are there to prevent a systemic banking disaster. Unfortunately, those regulations failed to be enforced.

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Contrary to what many say, the regulations we needed to prevent this crisis DO exist, untouched by any prior administration, dating back to the 1910s. More thorough oversight and awareness of bank balance sheet holdings by the Federal Reserve (which created this problem in many ways), would have triggered an intervention before the risk became systemic.

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Our current banking crisis was also the result of a failure of the imagination. Like the bank executives, they (the fed) truly believed that rates would stay at zero perpetually and that inflation was generally a historical relic. They also believed that the US treasuries are risk-free assets considered on par with cash. As a result, by making assumptions about the path of rate levels and believing that low-interest rates were the new normal and that US treasuries were immune to market forces, they failed to see this coming. By believing inflation was permanently dead, a fundamental framework was embedded into regulatory thinking: that we lived in a world where interest rates would never rise again, certainly not several hundred percent, let alone in just a half year's time! This situation simply didn't fit their model. The regulator’s worldview that Treasuries were risk-free assets and their adherence to low-interest rate monetary policy made it impossible for the nation's bankers to foresee any possible issues. Issues that we are now finding out are quite possible and quite severe. In their eyes, this situation was not possible.

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These are our nation's economic experts, the same group who missed inflation for a year and a half. How can they expect us to hold confidence in their management going forward??

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It is necessary never to forget that the government essentially wrote a blank check to "too big to fail" institutions in 08 by buying toxic assets off their balance sheets at 100 cents on the dollar. They also initiated policies that led to the significant nationalization of major corporations, from the auto industry to major banks. These operations, asset purchases, zero interest rate policy, quantitative easing, and other lending facilities resulted in the longest bull market in US history, running for 12 years straight and saw stock indexes tripling or more in that period.

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Furthermore, during the peak panic of COVID, the same Fed committed to major asset purchases on the order of 100s of billions that included the potential for not just treasuries and MBS, but also corporate debt and equity ETFs, making the government an equity holder of public companies. Probably not legal, and unprecedented. They also created a lending facility where fixed-income collateral could be posted for fresh, ample liquidity. And if that wasn’t enough, they committed and executed massive liquidity injections to the system in the form of interest-free capital transactions that swap illiquid assets off bank balance sheets for extremely liquid cash.

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The scale of this was also unprecedented, as through this mechanism, the Federal Reserve conducted market operations to the tune of 1 Trillion USD a day, for two straight weeks. This exploded the money supply, led to a surge of sustained inflation, skyrocketed the affordability of real estate, and led to a nearly 150% rally in. equity markets, before ultimately starting to collapse on itself in 2022.

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They have managed to walk a tightrope over the last 15 years, patching the system with special lending facilities and quantitative easing. Still, there is no such thing as a free lunch. The chickens are now, for that ride fueled by virtually free money chickens have come home to roost in the form of historical rates of sustained inflation, eroding the wealth of most Americans and causing significant market distortions that the economy is still strained under to this day.

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Our school district is objectively not performing well, coming in well under the bottom quartile of the nation. Anyone looking to move for a job will immediately realize that fact in addition to everything else and either option 1. relocate instead to a growing destination with better commercial access/amenities, lower crime, lower taxes, better schools, and likely better job prospects/opportunities - many places fit those criteria. Or option 2, becoming more and more possible, is to stay put and work remotely.

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Crime rates are very high, almost twice the average crime/per 1000 residents in PA, and even more so than the national average. To put that into context, you have a 1 in 185 chance of being on the receiving end of a violent crime. If those odds make you uncomfortable... you have a 1 in 52 chance of being the victim of any crime.

The answer is not more taxes or new shiny branding of past failed ideas; It’s very simple, we need to make this place as business-friendly as possible and cater to the fact that more and more people can work from home, meaning people living in big cities for big city jobs can now live in more laid back places where you can drive or go for a walk. Start with figuring out the math to slash the income tax and drive down real estate taxes - make Erie one of the cheapest places to live in the state and region. We already have a tremendous cost-of-living environment, very low energy costs comparatively, and very cheap. However, all that good is undone by the taxes that yield very little in terms of results. It's clear something isn’t working, so let’s stop what we’ve been doing for decades and try something else, like copying pro-growth strategies implemented in other cities and states that have resulted in big turnarounds/comebacks.

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For the life of me, I can't believe that's even an issue to debate. Low taxes work - Texas and Florida are two of the country's hottest real estate markets/general economies. Both have a very different governing philosophy than ours in Erie, PA. The reality is that their strategy has, repeatedly, proven to be the winning strategy for growth and well-being. The stats don't lie. This is true on the national scale as well. But let’s keep it local, as national politics and the various special interests that come with it make a mess of a logical and rational policymaking process. We see what winning states are doing and have in common. It's pretty clear that light regulation and low taxes have a high correlation with economic output, leading to prosperity and quality of life. There is an obvious example of a place governed the way Erie (and, more broadly, Pennsylvania) is. It's seeing massive net migration out of state, failing civic services and infrastructure, terrible credit, rampant homelessness, and high crime. It's also the country's highest-taxed state and happens to be a uni party state, California. I see these states, and I can't unsee some correlations......

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I can't believe I'm saying this, but Erie City has a lot of room left to borrow through the municipal market under our laws. I truly think our best shot is to take a big risk (once rates come down), borrow large dollars with very long terms, and use those funds to keep things operating while taxes are dramatically reduced. Use some more of those funds to promote Erie to businesses looking for new locations and market the fact that real estate and energy prices are rock bottom here. The only thing that holds someone back from operating a business here is the taxes because otherwise, it’s hard to beat.

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It also means we need to get really tough on crime. Throw the book at violent offenders. Don’t let minor violations slip. I don’t have hard data on the rates, but anecdotally I know a fair number of people or contacts of people I know that have committed some crime and more or less got a slap on the wrist. This doesn’t mean start kicking doors down because some kids are smoking pot, but robbery, violent crime, vandalism, you really have to make the price really high for those actions to drive rates down. Look what New York had to do in the late 80s-early 90s. It was an incredibly dangerous place. It took seriously tough law enforcement, broken window theory, etc., to fix that city up, and (up until recently) it was probably one of the, if not the, safest major metro hubs in the world.

It also means we need to think about how to make this place more attractive, right now many homes have fallen into disrepair with no prospect of improvement because no out-of-city developer sees an opportunity here to buy real estate and rent it - as real estate appreciation in Erie is some of the worst in the country. Additionally, rents are very low, even in the best neighborhoods; most neighborhoods are around $950 or less. This scares away quality developers and attracts not-so-quality developers. How do we address that? Focus more on our aesthetics; a start would be to create and enforce expanded zoning rules and building codes. Many properties have been quickly thrown together with the cheapest materials possible to get a quick fix flip and rent for 900-1000 a month. A lot of city property is not homeowner-occupied; it’s primarily rented.

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Don’t allow slum landlord behavior. It does so many bad things to a community, it's unfair to the tenants, it ruins the beauty of a community, and much evidence shows that it leads to higher crime levels. It has to be understood that to invest here and benefit from (our hypothetically) low taxes, cheap land, and energy, you are then expected to do more than put four walls of plywood up and roll some tin over the top. Lower the tax burden, but enforce stricter coding, and the money will flow back into increasing the aesthetic appeal of our community. The school district should also tap the municipal market and make significant investments into long-term cost-saving measures, capex that will drive operating costs down, and give some room to lower taxes on what is a predominantly low-income population, to begin with. I wish I had better ideas, I don’t know how to fix something like a decent size city in one blow, but I think there are things we can undoubtedly chip at.

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Raising the top bracket to 39%. Jumping Corporate tax rates by 8%. Doubling long-term capital gains tax to ~40% from 23.5% currently. Eliminating an incentive-based compensation structure where financial managers often don't have a guaranteed salary and only benefit if their client's benefits are rightfully taxed at the capital gains rate. This is fair for several reasons, including the simple fact that those earnings (often benefiting large pensions, life insurance companies, nonprofit endowments, and academic institutions) are in the form of capital gains. As such, the manager is contractually owed a portion of them for clearing a certain return threshold for his investors. Also often forgotten, this treatment is only for long-term investments - short-term trading gains are still taxed at the income bracket level. Moving down the list of travesties, this proposal calls for axing 1031 like-kind exchanges, which have helped fuel record US home ownership, and steady, strong growth in housing prices year after year, making many Americans much wealthier in the process. Furthermore, rather bizarrely, the administration wants to cripple a nascent industry with massive potential and should be allowed to grow and mature into large-scale, stable solutions appropriate for the general public. They are taking that step by penalizing investors in crypto securities by, rescinding their right to claim losses against future trading income, something you are well within your rights to do with equities and other financial instruments.,

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In line with their radical position on energy and global priorities, this administration is attempting to crush further oil companies fighting for American energy independence by revoking and nullifying all and any benefits to the industry under the current tax code. This is especially egregious when you consider the environment we are in: The domestic market is in an existential crisis, and as a result, E&P capex investment is very depressed. This is directly a result of the daily regulatory threats and hourly bombastic rhetoric by leaders openly calling for the industry’s extinction, all vowing to take steps to put them out of business in a few short years. One of the world’s largest oil suppliers is off the market, dramatically reducing global supply in arguably the most global market. Similar issues are emerging from the Middle East. Members of OPEC are talking about reducing oil output, with Saudi Arabia at the forefront of those calls for reductions. Our own reserves are historically low, and we are facing a raging battle with inflation that won't subside despite the Federal Reserve's best efforts. With all that in mind, it should be clear that it is NOT the right time to isolate and excessively punish an industry crucial to our economic health and way of life.

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These policies are inflationary, damaging to growth, poorly thought out, and shamefully partisan. No one should take them seriously, and Republican lawmakers shouldn't even waste their breath trying to negotiate in good faith when this is the type of opening offer the opposing party brings to the start of negotiations. Democrats know we will never agree, which is why they are doing this. They don't have power now, so the best they can do is make Republicans look bad in the eyes of the public for not supporting debt reduction, protecting the wealthy, and doing favors to the energy lobby. We shouldn't entertain these games. We hold the keys to a debt ceiling limit increase and must ensure they know that every step of the way.

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The SWF as I see it could invest directly in securities; private or public, invest in debt - whether it be AAA investment grade debt or debt of a company on the cusp of collapse as a way of becoming new equity holders as it comes out of bankruptcy. The SWF could also issue LOC to companies/initiatives deemed worthy and fit within the guidelines established by its long-term strategic objectives. It could also establish new companies, build management teams, inject funding, equity, financing, or otherwise, and then quickly look for a U.S. buyer or carry the investment through to a public offering, where the SWF can finally step away and “exit” from managerial responsibilities (though with $1.5 trillion in assets, I'm sure they would be able to build a worthy management team for a “small” company - small being billions in this context).

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The impetus / political dynamic that got me down this road is that due to our unique - and exceptional - system of government, we are in some ways at a large disadvantage (this is only true for small, emerging countries with no established legal system, common law, property rights, etc. every modern flourishing democracy evolved out of an autocratic system) to autocratic/strong men type countries (only if the leader is smart and trusts smart people). We have the power to quickly expel bad leaders from power; especially in the house, but even the highest office in the land has a short leash. The issue with this is for both, about 50% of their tenure is dedicated to campaigning (more so Congress than POTUS). Additionally, due to our system requiring obtaining substantial support from many groups in this country, you must campaign on policies that will deliver desired and popular results as soon as possible. A plan with a significant upfront cost and sacrifice to the public with a potential payout somewhere down the road is often a hard, if not impossible political sell. Also, with such short windows of power, elected officials focus on the short-term, rather than the long-term impacts and needs of the country. The thought is well to fix a problem 8 years from now, I need to win today's election, therefore I’m going to campaign on this potentially far less important issue and ignore the long-term one lest my opponent makes me look out of touch or not concerned with voters' interests. So, in short, our system really handicaps long-term vision, strategy, and sophisticated policy.

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A good example – is Obamacare, while not a fan (I was once fiercely against any form of universal healthcare, now I am a staunch supporter - from the right if you can believe that!) of how it was done and implemented, the motivation was good, and it was an issue that needed to be addressed. The problem is we were coming out of a devastating recession, a labor market completely trashed, household net worth cut in half, and so forth. That alone makes messing around with an industry that makes up 20% of our GDP, and far more when you start bringing in small/med/large business mandates. Also, Obama lacked a cooperative Congress. I'm quite impressed something even got done - I was actually on Capitol Hill the night it passed. But my point is, overhauling and reconfiguring a giant part of life and the economy, especially in such unstable economic times, in a rushed and urgent manner, was a display of our system at its worst. Reform of healthcare is desperately needed, still, despite o care. But it’s going to take a lot of very smart people, working together, using the best ideas of both political sides, to come up with a truly successful universal system. It’s not something that can be done in a few months with 50% of the people voting for or against it with a political gun at their heads.

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That’s a process that a president should start a working group on in the first few days of his admin (preferably worked on before he even ran), bring in the brightest physicians, bring in the pharma and medical CEOs, bring in insurance company leaders, and get them to work together and work out a new system that works for all parties, limits the government's direct involvement with healthcare decisions while still providing assurances of healthcare access, and leaves no stone unturned, adds no new onerous regulatory requirements that aren’t needed, caps and limit’s malpractice, opens insurance to cross state lines, and say look, you have 2 full years to craft a legislative solution for a new system. If you fail to do that, there will be repercussions. We will default to a single-payer system; totally bypass insurance players; regulate every aspect of healthcare, increase malpractice payout caps, etc. basically something that would make all the players upset. And I guarantee you that with two years of the ability to privately Come up with a system, you’d end up with a much better result than some several-month processes and a midnight vote. Some of the most important US institutions were done in similar manners. The federal reserve is. Great example. A small group of senators went to a vacation destination off the coast of Georgia if I’m remembering correctly; and in total secrecy, they drafted the bill that led to the formation of the central bank, which in my opinion is one of if not the most powerful institution in the world outside of the U.S. military. But it took years, and many tries to get that bill done.

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So, we have a beautiful system that ensures fresh blood, but the terms and lengths of power almost necessitate dependence on think tank/lobby groups on drafting legislation and a forced artificial urgency on issues important to key donors. If you asked me, what are American strategy and goals for the next 10 or 20 years? I couldn’t tell you, and I don’t think anyone out there could really give you a certain answer. China, on the other hand, that question would yield a very specific response. Command economies are bad, but there is a big distinction between a command economy and a country that understands it’s not just floating through time, but rather a growing organism that requires a path or strategy to move forward, grow, survive, and improve life. Our president's terms are too short for them to really do that. There are some notable exceptions - the moon shot being one. But by and large, we govern on a day-to-day, month-to-month, and sometimes year-to-year basis.

A great example. We were attacked by terrorists in 2001 by a group called the Taliban, holding out and launching terrorist strikes out of Afghanistan. We rightfully responded with overwhelming force. But we were like a dog that caught up with its own tail. What do we do now? The same scenario played out In Iraq. We won, now what? A dynamic and failure that cost far too many lives and enough treasure to rebuild our nation. We went in with purpose; but lacked strategy or a vision of what things should look like when the war was done.

The Marshall plan was a great example of the government looking thru the lens of history and strategy. It was a large-scale, costly, and targeted effort that cost Americans substantial sums, but one that rebuilt Europe (dramatically increasing our trade capacity and alone due to their increase in GDP and our trade with them paid back that Investment) and it also achieved the goal of stopping the advance of communism. I see nothing like that happening now. We talk about China; our military leaders often express concern over an imminent conflict, and we know they are building huge weapon stockpiles and systems - mostly designed to specifically neutralize U.S. assets. But we aren’t doing anything about it. We aren’t forming coalitions at a rapid pace in the pacific. We aren’t increasing our defense budget (in real terms it’s decreased for several years). We aren’t arming key partners like Japan. And while we do nothing,

China is not making that same mistake, it is surging up its supply chains, whether it’s oil from their new friend, Russia, or countless other raw materials found throughout the developing world, from a place we set up perfectly for them - Afghanistan, home to the trillions worth of rare earth minerals - to developing nations up and down the coast of Africa and into its internal under the belt and road initiative. TBRI is a great example of a national strategy that outlines and builds a system for a country to use its strengths - large FX reserves, cheap labor, mass manufacturing, and large financial sector - to advance national interests and long-term strategic goals. Yes, on its face, they were doing humanitarian things. They build infrastructure, power plants, 5G network grids, and seaports. But they did it at several costs. 1. Those projects were picked out by China, implemented by deploying Chinese labor, using Chinese manufacturing components, and financed by, well, China. They also ensure that the next generation of future global communication (5g) is directly In the hands and control of the CCP).

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To review in summary, the Chinese build these large infrastructure projects paid for by nations who borrowed Chinese money to pay for them, paid chemise laborers to build them, incorporated comportments only Chinese parts could replace, and enforced communication infrastructure from China to underpin all their projects. China can do whatever it wants to and that includes a strong desire to build massive seaports that dramatically expand China's potential trade with the developing world, while also creating a vast network of deep-water seaports that are, or can be very quickly, naval bases which give them a global footprint on a scale close to only one other, the United States. For all of this, those countries now must pay China back the debt for the trouble. It’s truly a genius state strategy. It accomplished so many goals, it elevates China's standing in a big way, left a heavy influence in developing regions such as central Africa, and expanded its international infrastructure for both peace and warfare. And they did all this by lending huge amounts of FX reserves - made possible by the insatiable U.S. consumer - that will likely be paid back + interest, or at worst case, fall into Chinese ownership - which is already effectively the case, that would Just formalize it. The United States needs to start thinking like this. With our two-party system and rapid election timeline, it’s very hard for the people or leaders to focus on what needs to be done for a decade or two from now, and if it has a cost, forget about it as it won’t be touched until it’s on the brink of catastrophe.

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An example of an American policy that was designed on a short-term basis, but eventually become a long-standing tenant of the American system, yet today is still haunted by the specter of no guaranteed overruling strategy regarding its existence. I will leave you with that: Social Security. A wonderful silver lining came out of the Great Depression. At first, it was meant to be temporary, but I’m time it was realized the important role it played in providing dignity and support to our fellow retired countrymen and disabled laborers. However, like anything important, it has substantial costs. We (well, pretty much most people) all agree that the program can’t be shut down, that we can’t reduce benefits to seniors - especially when unofficial inflation is far higher than the COLA rate used - and the idea of raising the age is deeply unpopular (I see merits and issues with this, personally no opinion on it yet until I learn more), and any other idea, including privatization, is dismissed out of hand. But we all know social security is on borrowed time. The number of times I’ve heard someone say I hate paying this because we all know it’s going to be out of money by the time I qualify. This is true, in part. As it stands, the system will no longer be able to make payments in the not-terribly-distant future (2034). So why on earth is this issue not being addressed now? Because it’s politically unpopular? That’s outrageous to me. In typical fashion, are we just going to wait until 12/31/2033 to pass legislation to save the day? The way we operate, I wouldn’t be shocked. But with such a long runway, and such support for a supportive system for seniors, why can’t lawmakers sit down and come up with some solution that makes everyone happy while making financial sense? The reality is that the population is aging, fewer people are working at younger ages (something that I think rapidly increases with the adoption of AI and robotics), and people are retiring sooner, yet living longer lives. So, there is a structural issue there. SS depends on young labor to pay into a fund that then distributes to nonlabor seniors, all of which is calculated based on average mortality. Well, less young labor, more nonlabor seniors, longer life spaces. So, the core mechanics need to be revisited in some way, and I am open to all ideas at this point, I just ask we don’t wait until the 2030s. This was all a long-winded way of showing and exposing actions of the government that show there is a dramatic shortage of vision, and courage to tackle issues that may be unpopular in the short term yet crucial in the long term, and that our short political cycle reinforces those elements and makes large scale, significant change and improvement nearly impossible.

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The last example I will point to, the largest failure outside of the Iraq war in the 2000s is the failure by 3.5 presidents to recognize the importance and strategic significance of semiconductors. The first few years of the 2000s are forgivable to a degree, but by 2007, when the iPhone was released and it was clear we would all have computers in our pockets in the near future, national leaders should have recognized this and acted on it, doing everything in their power to ensure that the United States is home to the best, word class chip design industry, as well as home to the largest semiconductor manufacturing ecosystem in the world. If you are wondering if not us, who does have that status? China and a territory, Taiwan, that China claims and will likely try to retake, through invasion or blockade, in the coming decade. About 95% Of the world’s chips come from those two countries, and one is hardly a friendly or fair geopolitical actor. The other is under constant threat of military aggression. If the US and China have an escalation, even just a very warm Cold War, or if Taiwan is invaded/blockaded, the world will completely stop operating the way we have grown accustomed to over the last 100 years. There will be essentially no new semiconductors for manufacturing anything. That means no iPhones, no computers, no modems - which means no internet, no cameras, no TVs, no cars, no fridges, basically no anything that is even somewhat “smart.”

The fact we are this vulnerable and in such a fragile Position is a damming commentary on the West’s foresight, strategic thinking, and political priorities. So where along the way, the West seemed to have forgotten that the world is a dangerous place, even today and that for many, what we consider poverty in our developed nations pales in comparison to the poverty experienced in the undeveloped world, where governments rise and crumble all the time, where bank account ownership is virtually impossible (600m Africans don’t have a checking account), and food and water is not a guarantee on any given day. All that said, I lay the most emphasis of my blame at the feet of the US presidents and their administrations. I don’t expect individual presidents to understand or see these things, that’s now how they became presidents, or why they become presidents. They become presidents because they know how to market themselves, determine the policies they think will resonate the best, and paint them together in the most eloquent way possible. Once they have the job, they are there to make high-level decisions based on data provided by many thousands of analysts and many outside friends and advisors who provide counsel. Those are the people I take issue with.

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The fact that no one picked up the phone “Mr. Bush (Obama, Trump), these computers are really becoming a big deal; more so than we ever anticipated. Right now, we sure make a lot of them and the best software is made in America, but China sure does have a massive manufacturing advantage when it comes to fabricating these chips. That’s something we can’t sit back and watch, we need to not just match, but outbuild their chip industrial base, and we need to do it quickly, or we will never catch up. They could turn the lights off on us without firing a shot Mr. President. Let’s get to work on this, tomorrow, and don’t let cost get in the way. We have plenty of ways to finance and fund the type of infrastructure projects we’re talking about. If we could build the first nuclear weapon for 92bn dollars, or even the cost of our entire nuclear activity from the 40s to 2000s for $5.5 Trillion, I think we can mentally come to terms with spending a few hundred billion winning the next Manhattan project race. I call it a Manhattan project, because that’s how urgent it is, and the country that ultimately dominates space will have the same leverage that the first country with a nuclear weapon had. Please, put a team together, commit $500bn to this, and let’s get America back into the game.”

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• Completely upend my industry, destroying incentive-based compensation

• DOUBLING capital gains tax

• Upend the real estate industry by canning 1031 like-kind exchanges

• Rip away all tax code support for American energy independence,

• Call for taxes that will drive up the cost of goods I consume,

• Crush companies with a huge 8% increase that will lead to reduced supply, quicker adoption of automation, shirking labor wage rates, depressed corporate earnings and by extension, stock prices, and very importantly, stifle technological innovation

• Smack hard-working Americans with an extra 3% on marginal income bracket rates - as if that really produces any meaningful revenue. Just leave it at 37, last I checked the treasury can borrow at, even in today's world, like 3% on the 10y horizon.

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House GOP better stand man to man in complete and total opposition to any of this crap, not an inch given. Kevin, remember, we have you on a leash. You try to deal with them, and it's over, Joran or someone else will step in and stop the insanity.

Democrats refused to ever cooperate with Trump on any policy issue, even things that made bipartisan sense. We have an obligation to repay that favor, not to mention a solemn duty to stop ludicrous policy ideas like the ones listed above that would send an earthquake through our economy during a very fragile period. Every single one of these ideas is trash. I have no respect for Janet Yellen or any of the other Econ advisors in Biden's inner circle. They are all ivory tower leftists with only failed to show for any time they might have spent in the real world. Janet was a terrible Fed secretary, in way over her head, and she's an even worse Treasury Secretary. Cecilia Rouse is a disaster. Lael Brainard can't be trusted and belongs in a classroom. Jared Bernstein is a bozo. Neera Tanden almost got picked for a top spot and she's a total nut. Wally Adeyemo is a china-loving globalist who has spent his career climbing political ladders, not working in finance, Jared Bernstein eye roll,. Brian Deese is a decent enough guy, but he's a theoretical policy wonk. These people listed are Biden's top financial/economic people. Not one of them has ever operated a business. Not one has ever worked in sophisticated finance or a buy-side institution. They have spent their whole careers theorizing how to best implement their own independent versions of socialized capitalism. Everything about this team is disappointing. I guarantee Yellen will be gone before the year is over, things are going to get much worse and they are going to make her fall on the sword - and she sort of deserves it given the way she's managed debt issuance/treasury savings account and the debt limit.

I knew in early 2020 serious inflation was coming, ESPECIALLY after congress unleashed even more from the fiscal water foundation and just drowned the entire earth with cash, despite life for many in this country returning to normal and there being no need for trillions of stimulus – a large part of why inflation is so elevated everywhere in the world right now. We passed a ton of spending, far more than was necessary to keep demand at a reasonable level, that enabled us to buy up global supplies, leaving limited goods for everyone else, hence inflation. This was only turbocharged by the fact that the Federal Reserve monetized that debt-fueled spending by essentially immediately buying every bond issued to pay for the emergency covid programs. That is outright debt monetization, or as some might call it, printing money. But she was in charge and was a former Fed chair, seeing the big economic picture was supposed to be right in her wheelhouse. If I could see that we had set the stage perfectly for an avalanche of inflation, surely she could? Apparently not, as rates at that time were 0%, she could have easily been out there issuing hundreds of billions of new 30-year paper - maybe even issuing a new 100-year note, but instead, she kept the financing short-dated, rapidly. maturing, and oddly spent down the savings account rather than the alternative. very bizarre. If she knew inflation was coming, given that she was a former Fed chair, she probably should have been able to guess that interest rates were going to go up, and significantly, in the near future. But Nope, she just peddled vaccine gibberish as if that's a treasury function, talked about transitory inflation, mismanaged asset liability modeling, and generally floundered running the treasury of the world's richest nation...

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est, and feel a sense of dignity. Most of these people are mentally ill or have suffered incredible life catastrophes and run out of options, ultimately living on the streets and being ignored by society. That is what is unfair; that is what a tragedy is. What isn’t a tragedy? Being required to pay back a loan you agreed to in a legally binding contract that was 100% transparent and accessible, an agreement you freely entered into that financed your opportunity to get a certificate that proves you possess a certain degree of proficiency, capability, and have the potential and discipline to work at a higher income job.

The fact that everyone is just ok with this and thinks, “oh yea well, it's unfair they have all that debt, so let's just bail (using other people's money, for one specific tranche of students that another will soon replace, and then another and so on) them out..” blows my mind. That college wasn’t worth it and that people were tricked into it is ridiculous. ( First, I knew it was a scam, 70k a year, for what? I’m out of here. Dry lectures that half the class skipped out on and a heavy social drinking schedule? No thanks, I’ll pass.) Secondly, the facts are simply that, the reality is that someone with a college degree will have significantly higher lifetime earnings, even after debt, than someone without a college degree. I’m sorry, I really don’t have a ton of sympathy for a lot of these people, because I saw many kids on financing at school who essentially treated college like a four-year vacation with a couple of exams scattered in.

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Biden has once again confirmed that my suspicion was correct. Today he proposed that 1. we should tax billionaires 25%, regardless of how their earnings were made, and in total disregard to the legal tax code. 2. He wants to go after high-income earners, those filing jointly, making over 693k. Currently, they are taxed at 37%; he wants to take that to 39.9%. I would say that at 40%, many people will find new ways around the code, or retire and say, "you want me to work 4.7 months of the year for the government, before even looking at state and local taxes? Forget about it." It's also outrageous to ask people to essentially work for the government for half a year, considering how bad the services they get in return are. I wouldn't even mind if Medicaid, EBT, etc., were run better. Still, these people in government are absolute professionals at wasting and poorly spending money to the lowest possible return per dollar spent. Another issue, 693k is a ton of money, don't get me wrong. But if you have a family of 4-5 living in a major metro hub, it suddenly is much less than it sounds. You also likely carry substantial student debt with that income level.

The other fact, the tax brackets were designed so long ago, inflation has completely changed the scale. Yes, the levels get adjusted for inflation. However, they were structurally designed long ago and had many more brackets than we have now, covering a much wider income span. In 1913, the highest rate was 7% on 500k; the lowest rate was 1% on 0, 2% on 20k+, 3%+ on 50k, 4% on 75k+, 5% on 100k+, and 6% on 250k.

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Let's ignore all the brackets and look at the top bracket, $500,000 of 1913 money in 2023 is worth 15,109,595.96. 7,554,797.98 taxed at 6%, 3,021,919.19 at 5%, and so on. So today's taxes are far more punitive on much smaller amounts of wealth than when our modern system was created. I would have no problem expanding the brackets and increasing the rate, considering there are 22mm millionaires, (8-9% of the population, or 11% of households); however, a 690k max bracket level is far too low of a threshold and far to a high of a rate. A code with 0, 15, 22.5, 28.5, 32.5, 35, 37.5, and 40 makes far more sense to me, and it should cap out at least 10% of the original income tax levy back in 1913. The difference between someone making $700k and someone making $1.5mm a year is enormous. Grouping those two earners into the same tax penalty box are outrageous.

So with what I am proposing, the highest income bracket should sit at 1.5mm, and I'm ok with being in that position and paying 35-40%. But what Biden proposes is just taking the piss. The worst part? That's not the worst part of his proposal. It deserves its own post. It's that absurd. And again, I’ll add. I wouldn’t mind the thef…sorry, taxation, if only the government did its jobs far better, more efficiently, and more frugally than they do currently. There are layers and layers of excessive bureaucratic bloat that make everything involving the government slow, dated, and cumbersome. I would be terrified if I had to count on the US federal government for crucial aid.. The only thing the government manages well is spending far too much money for far too little. Ask anyone that receives government benefits of some sort. I guarantee you, even as net beneficiaries, they will say the system is terrible, there are constant delays or mistakes, and the people being served are treated like numbers in a system. If we have to pay half of our yearly incomes, we better get the best government money can buy.

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But. All that said, but never going to happen! There is less than zero chance of this Congress passing any fiscal bill this President puts forward. I was worried about this group, and still am, but I'm very thankful they are there for this one. The real problem is part of Biden's proposal I will comment on next. I have serious thoughts about it and am, candidly, highly subject to it. Beyond personal reasons, the activity it will restrict or outright eliminate plays a vital role in the many achievements and accomplishments made by mankind, spanning technology, services, healthcare, social functions, logistics, transportation, and much more, all of which are improvements made by our capitalist system through a process this financially clueless administration wants to slam the breaks on, right as the economy starts tipping into a recession due to the Federal Reserve needing to essentially cause a recession to slow down inflation that Biden legislative "achievements" played a huge role in.

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1. Raise taxes by 3.7% and impose a minimum of 25% on the ultra-wealthy

2. Raise taxes on investments, in some cases by 19.7%

3. Raise taxes on businesses by nearly 10%

4. Hibernate until November 2024 and vote.

More fun with great policy ideas, below!

Economic policy to lower the cost of oil for US consumers?

1. Eliminate all tax preferences long enjoyed by the Oil industry right at a time when oil has become very scarce, one of the largest exporters has been sanctioned, our SPR is tapped, and prices at the pump are at very high rates.

How to increase real estate investment and continue improving the nation's housing stock?

1. Eliminate like-kind exchanges, a process that allows a seller to buy a new property within a specific period after the sale and roll the cost basis from the original to the new property, thereby not triggering a taxable event. For example, you sell a building for $100,000 that you bought for $10,000. You then find a new property, building C, that costs $110,000. You structure a like-kind exchange wherein you sell A, buy C, and in buying, you roll your cost basis from building A to building C. This is a decades-old, prevalent practice in the real estate industry and would adversely affect the market.

How to stabilize and legitimize crypto assets that so many millennials and younger are interested in?

1. Eliminate the ability to collect a loss when selling crypto for a price below what you paid for it, thereby removing your ability to offset any gains in that tax year from other crypto trades by the loss you incurred. Example: Buy BTC at 20k. Sell BTC for 19k. Buy BTC for 21k. Sell BTC for 22k—net Tax bill: 0 under current law. Under the new proposal, you would pay taxes on the 1k you made, with the loss having no impact on your declared earnings.

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How to stimulate the innovation pipeline and the funding mechanism that has powered silicon alley and led to the formation of countless multi-billion dollar companies that employ literally hundreds of thousands of people and have made vast numbers of savers and pensioners huge sums of money, all while solving technological problems, in many cases for the betterment of society?

1. Eliminate the compensation payment treatment for managers operating private equity, venture, and hedge funds. Currently, any of the above funds raise money from a network of wealthy investors. They agree with the manager to commit their capital; the manager will invest that capital in exchange. To cover his operating expenses, such as legal, employees, accounts, etc., he will collect 1-2% of the total assets under management. A second part of the agreement is that if the manager reaches certain thresholds that his investors establish in structuring the deal to make the fund, that manager then collects anywhere from 10-25% of the total capital gains made by the fund.

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How do they want it to work? Same as above, except instead of the manager paying capital gains tax on.... capital gains that he/she was entitled to, he now must pay income tax on those earnings. To be very clear, those are not wages. There is no guarantee of that money; in a bad year, he might make none at all, and if he has a negative year, he likely won't be able to collect carried interest until he reaches his previous high water mark and surpasses it. This structure, at its core, is about incentivization. If I get 20% of the earnings of a pool of money, I will do everything I can to advance the interests of that pool. So, in summary, these are not wages, they are not pre-determined, there is no guarantee they will get them, they reduce fees for investors - without carried interest, managers would increase their management fees to 5,6,7%+, they align the interests of the investment manager with the clients, and for carried interest tax rate to apply, the capital gains from the fund must be long term gains, meaning gains from securities held for more than a year. Gains less than that are taxed again, as capital gains, but short-term capital gains are the same rates that income taxpayers have to remit.

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This destructive policy will upend one of the essential industries in the country in terms of advancing innovation, solving problems, allocating saved capital, and building wealth for countless people in this county, from independent savers, investors, and 401k holders, to pensioners. Not everyone necessarily has a stock brokerage account, but nearly every American has some of his lifetime net worth exposed to the stock market's performance. It will drive costs up for investors substantially. It will lower the incentive of the manager to put everything he or she has into the fund. It will likely reduce the size of the total fund universe, meaning less capital is being smartly deployed to emerging and potentially successful enterprises. This doesn't create much in the way of tax receipts. It's just an easy target - the big evil wealthy bankers. Parade them around, upend their long history of operating a certain way, and slap them in the face in the public square for a cheap thrill for the party's most loyal supporters.

I think I’ve realized what will replace labor, occupy time, and give meaning to life. It comes back to the concept of the Metaverse. In this persistent online experience, humans will spend more and more time inside this environment, where joy and excitement can be readily had for essentially nothing financially. We have plenty of data to show the dopamine response to social media and receiving “likes,” so our pleasure and happiness engines of the brain will be satisfied, maybe even more so than what can be found in the physical realm. This environment, a whole new society, will require the creation of endless content, scenery, merchandise, and other valuable items. That means we will need endless numbers of creators. You can see early signs of it now; podcast hosting is one of the fastest-booming jobs, where you create consumable content by talking to a friend on camera. We crave the content. All the people who are content with a basic standard of living and without meaningful labor can become creators in this new world. Houses must be built, skins for avatars must be imagined, car color options, etc. I believe that a core requirement for the Metaverse is the ability for virtually anyone to make things. It will be at the core of our experience and how our economy will run. Ads for Metaverse - or physical - merchandise will create demand for spending. This spending will likely be taxed by the organizations/people that operate this digital universe. Those tax dollars - which will be massive due to the fast ability to purchase and issue government-funded minimum income - turn around and will be used for infrastructure.

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This tax rate will be very low., widening the tax base and increasing total revenue. After all, what’s .02 cents on a 200-dollar purchase of a digital replica of a famous painting with unique ownership properties? Due to the deflationary pressure of technological advancement, this environment will give the “government” room to create currency out of thin air to provide many users/citizens a basic income. The fear of inflation can be kept in check as deflation will persist. At the same time, demand for metaverse spending will continue to advance rapidly, as supply can easily be created, which would prevent a supply side from being too limited to the total demand - a core recipe for inflation. While I argue that labor in the sense as we know it today will be a relic of the past, in the next 50-60 years, new labor will emerge. Endless creation of content. Our value, our meaning for life, will become creating things that millions and even billions could enjoy rapidly from concept to final good. Our brand - our digital identity - will become a reflection of those goods/services/experiences. Of course, many with limited ability, even with the ease of use of creation tools, will exist. They will consume and spend as the government provides financial power. This consumption, via the multiplier effect, will turn into new tax dollars and economic stimulus for the entire supply chain of that product. They will consume ads, creating revenue for companies that promote while increasing demand for these digital goods. The digital middle class will follow that. This group still will receive a basic universal income. It will become new content creators - that’s where an infinite supply of tv shows, movies, and art experiences, such as music, short-form, and long-form interviews, etc., will come from.

No one will be bored in our new future; dopamine will be triggered as much as you allow with your engagement with this world. And finally, you will have the upper and wealthy class. These will be people/families/companies/brands who drive mainstream consumption, provision of professional services, etc. Many of these items and services can be supported by simple token economics. - say you read a website, and the company pays you one type of token, which, if you amass several, can be exchanged for a token that you can pay for premium content. The platform receives transaction costs; creators are paid in the brand currency - which can then be sold on a public market, another significant source of demand for the currency, giving its value to the content creator. The company could increase or decrease the “reward” for content consumers’ usage. The economics of it becomes very stable, an endless rotational system. The user buys tokens on market or from the company, making revenue for the company to expand its service. The reader is paid with a form of token which can be grouped and exchanged for premium credits, a situation where readers are being paid to use the service. The reader’s payment flows to the creator, who then exchanges his tokens for the central currency and, by doing so, creates a supply of tokens available to purchase. The whole system coupled together makes it a constant circle of supply and demand.

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To give credit to the idea that this model could create stable economics, you have the system. Still, ads could supercharge the equation - which would drive up demand for reader tokens, raising available tokens that can be spent on premium content. This spending creates huge transaction “taxes” paid to the content platform maker. In short new, good content creates demand for this new token, and the increased value of the token/demand entices new creators to come to the platform. More creators on the platform and more supply entice more readers. More readers, who require tokens to access content, more demand for the token, and it keeps repeating. The content platform continues to scale up in the quality of infrastructure. The creation or destruction of tokens by the platform providers allows them to keep the economics stable; if the tokens start inflating, the company can slow down the creation of tokens and even destroy them. If the token deflates the platform can, the company simply has to go into the public market and buy supply which limits the number of credits and attracts new buyers to create demand for the TOKEN, driving token value up. It’s interesting this can be zoomed out and looked at h through the lens of monetary policy. With a digital currency whose supply can be expanded or contracted with the click of a button, reactions to slowdowns or overheating (inflation) can be met far faster than adjusting interest rates as we do in today’s world, a mechanism that takes 6+ months to materialize in the real economy.

The “government” can also slow down or expand currency payments to citizens. If the economy of the Metaverse begins to slow down, the government has to increase the basic income, instantly creating more possibility of demand. If the economy begins inflating, currency distribution could be slowed, or the government could destroy tax payments in the currency, reducing the total supply of currency units in the Metaverse. This instant ability to expand/retract the total circulation of money gives the monetary policy setting body, which must work with the fiscal policy to work genuinely, would make the current central banks salivate. The ability to fine-tune the market can’t be overstated. It would be far more stable than our current economic system. A limited supply will never be an issue (unlike post-Covid, where limited supply has driven costs through the roof).

The last I want to say is that this reality and the models I’ve mentioned require an ecosystem where an excellent quality of life can be had for very little as tasks and services we currently must do are outsourced to a machine. The system will work very smoothly as long as the “Metaverse” keeps expanding in the consumer’s experience. In the current economy we live with today, labor is a necessity to feed yourself and provide for your family. I believe this human construct, labor, will essentially go extinct and be replaced by a new type of creative labor. The idea that the current government could provide universal basic income is unrealistic and would be almost impossible to implement without rampant inflation or brutal deflation. The size of the deficit means very little, as the argument against deficient spending is that this spending crowds out the investing class. However, in this new future, deficit spending is compatible with this future. cost of capital will be very cheap in this system. This system is mainly based on creativity and the creation id new goods and services; these are hard things for a government to crowd out - as an example, painters and musicians have never been threaded by too much.

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Additionally, in terms of crowding out, this future provides unlimited potential for new “things,” and the cost of capital to start a brand or company will be incredibly low. There will be a very small hurdle to creating something new, something not hurt by government spending; the total economy is too vast to allow debt to GDP to pose a meaningful threat. . . Also, the government's total spending (GDP) in percentage terms will likely be very low, and it will need far fewer total assets to perform its functions. It will have huge and expanded revenue by taking a fractional percent in every transaction at a very low rate, thus expanding the tax base while keeping total levies low.

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There will be plenty of opportunities for growth and achievement in this world. The low cost of capital, vast levels of machine-driven productivity, and low barriers to entry to create new products/services will guarantee that. This is how a universal basic income could work and not become communism, though I admit this flirts with that idea. It’s a very different thing and depends on very different economics/ structure of society and huge techno-local breakthroughs that break the mold of the current system. One last note that occurred to me, regarding barriers to entry or creating goods in services - education, and training will be widely available and cost a fraction of today’s educational costs. This is seen even today, on the internet, especially in our post-Covid world, where entire academic experiences exist wholly online. One professor could provide lecture content for 100k+ students while having less real-world work under the current academic structure.

I see a world where academics (and hospitals) become a utility - and should be treated as one. I hope this creates better, more experienced, and open mindsets to go out and expand the economy even further. It will also create accountability, as the classes are all digital. It’s fair to say that word will quickly get around about which courses and professors to sign up with. But this exists today as a web service called “rate my professor,” but this system isn’t universally used. Something similar will become a norm, such as a 5-star feedback score readily accessible for look-up on the academic organization’s platform where you sign up for classes.

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I will rewrite this and organize it in the coming days and weeks. This is a wildly different future than many imagine, but what I’ve laid out is realistic, even a probable representation of the future. This all counts on the symphony of different technologies to emerge and converge. But we’re closing in on it at a logarithmic rate. There are endless other scenarios that could be written on. Still, I wanted to focus mainly on the new creative content maker, how their economy will work, and dive into what it means to be a human and how dramatically that will change in the second half of the century or if we must endure periods of low growth and global strife, then maybe the following century. This keeps me very optimistic about life. We must get there and have the right breakthroughs without blowing ourselves up fighting China or some other unforeseen foe.

The second leg of my outlook stool will be expanded ability in the medical field, anywhere from running genome models and creating new treatments for cancer-related maladies to the expanding toolkits used by surgeons when operating on a patient. This could easily manifest even new abilities for healthcare providers to 3D print organic material or grow organic material into new organs etc.

The third leg requires a growing desire of workers to be out of the office / shy from corporate brands and innovate and create an alternative path for life. This ultimately leads to a profound change in the widely accepted belief of what it means to be a human, to what it means to be a human in a labor-less world. We will need to do something for the masses, I believe I’ve outlined how that can happen, and it will require all of society to agree that time in life is better spent on yourself and your brand and that it’s socially acceptable not to be employed. This last step may be the hardest. It will be very difficult to get Republicans - and many independents - on board with a steady universal basic income. The irony of this essay is that I, the author, identify as a far-right Republican, who abhors the concept of socialism and the path it takes society down, and who believes that equal opportunity is the obligation of our government, not equal outcome. I indeed scoff at the idea of universal basic income. But the reality is that I am not blind, I consider myself very well-read and versed in the rapidly changing technology ecosystem, and although my firmly held beliefs, it’s hard for me to imagine a future \given the track we are on that doesn’t involve significant elements of socialism and a complete re-imagination of what it means to be a citizen, from responsibility to the state all the way down to loyalty and patriotism. As time progresses, we are simply inching closer and closer to a future where, with a high degree of probability, there is a globalized power structure. The notion of the nation-state will be looked back at as quant and dangerous. I don’t take joy in painting this picture, but I refuse to abandon intellectual honesty and fabricate a different outlook that more comfortably fits my worldview.

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I recently joked with my father; I said, “the more I think about it, the more technology advances and human labor becomes less and less productive relative to automated solutions, the more I’m starting to think that, while very dangerous, Marx didn’t have it all wrong. He was on to some things, but he was just a century or two too early and left too many doors open that made room for corruption and destruction.” My idea for a basic income, say it was 2090 today, is each person would receive a direct payment via a CBDC of $4,000, only to be spent on necessities. (That’s the abbreviation for emerging technology, a central bank digital currency, and yes, it is absolutely coming to a (digital) wallet near you. The Fed is well on its way to designing its implementation, and you can be assured that it will be a part of life by 2035, and with it, the government will have the power to deliver aid with pinpoint accuracy with strict safeguards against abuse, control where your digital currency can be spent, will be able to instantly seize your assets, track your spending and those you give to, prevent the purchase of firearms at the point of sale or, at a minimum, can finally build a national registry of gun owners that the left has called for, for so many years, and finally, they will constantly maintain awareness of your financial standing)

This benefit payment of $4,000 would be universal, given to the poorest man and all the way up to the wealthiest man; though the option to waive will be there, the richest amongst us will waive it if just for good optics. This new state-provided income will be the universal subsidy. It would mean the end of Medicare, Medicaid, CHIP, ACA Expansions, Countless entitlement programs, Food Stamps/EBT, and likely, Social Security. This future deeply unsettles me, but if it’s going to come, I want to try and get my thoughts out there on how to build a system that is least destructive and still maintains some benefit to the people. For healthcare, due to the changes I laid out earlier, a solution will be needed, and the likely scenario will be a near-universal call for nationalized healthcare. This is a mistake; the government is already too far involved with our healthcare and the operations of hospitals and private practices. Huge sums of money have gone toward the healthcare industry, but doctors are earning less than they ever have, and patient outcomes have been average or worse than just a decade or two ago. So the question is, where is all this money going, and what is it being spent on? That is the core of my argument against further government intervention and tinkering with how healthcare is provided. That said, I see the realities, and a “nationalized” solution will probably be necessary, and will almost certainly happen in the near to medium term. So I want to propose my solution to ensuring universal healthcare coverage. Instead of single-payer, what I would suggest is giving everyone below a yet-to-be-determined wage level a $7000 annual voucher, tied to CPI, that can only be spent on health insurance from a provider who must enroll with the State, an enrollment that will require the insurer to offer plans that provide certain minimum coverages and waive certain factors, such as pre-existing conditions. The health insurance companies will gladly tailor cheap plans near the $7,000 mark that meet the letter of the law concerning enrollment. Still, they will also design far more lavish healthcare plans with enhanced coverage and benefits for those Americans who spend more than the government-provided $7,000.

A vital part of this proposal requires competition across state borders. The days of companies competing only with other companies in the state need to come to an end; the result will be states working tirelessly to create a welcoming environment for health insurance companies so that they may domicile there and bring their substantial tax revenue. It could be described as a race to the bottom. Ultimately, one or two states will have incredibly friendly environments for insurance companies to operate in, like how Delaware bent over backward to become the most corporate-friendly state with a court system that strongly stands by corporate-friendly precedent. This strategy has led nearly every major corporation in the country to file and register a business in the state. With the CBDC, restrictions on the voucher money would strictly limit an individual from using his 7,000 vouchers for anything other than payment to a registered health insurance provider. (given this leftist kick I’m currently on, I would want to see legal changes made that would require health insurance plans to cover the cost of pharmaceuticals, which has caused countless Americans to slip into poverty. Strict monitoring of the voucher would be the way it is ensured that the $7000 subsidy is spent directly to a sanctioned provider and on a plan that meets the state-mandated requirements on covered illness and circumstance. Also, to take things a little further, I could see a situation where a $3000 tax subsidy for every plan written would motivate the health insurance companies to lose their apprehension over the new system and maybe even encourage them.

Of course, there will be higher coverage plans, but a bare minimum of healthcare protection is there, which I believe is critical to the welfare of the state and, by extension, its people. The free market works well, but sometimes the social cost and strain on the fabric of the republic. In these situations, the welfare of the masses necessitates bold actions taken by the state to preserve that fabric and the shared national morale of the people that make up this great republic. We need our country to be healthy; it’s a national security issue in many ways. Healthcare costs prevent people from seeing the doctor early, which then sees the issue to compound, and eventually, costs far exceed what early intervention might have run for. That said, we have innovations that could bring about significant improvements in general welfare and healthcare. For example, using an Apple Watch or other device to track your Cardio output, an insurer or another party could create an incentive system by reporting data to health insurance companies that allow them to price down your plan due to a better health profile. Incentivize fitness. These technologies are just emerging, so it’s genuinely only our imagination that limits what could be done with them and how we can use the innovations to our advantage, from driving prices down to improving healthy lifestyles.

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The reality is socialized healthcare will manifest in the United States sooner rather than later. If you don’t believe me, consider this. Autonomous driving is not some future science fiction idea, it’s becoming more and more real by the day, and the first place it will be used on large scale will be in commercial trucking. Why is this a problem? Because commercial truck driving is the most or close to the most widely held occupation in virtually every state. What will this country do when 21mm young men suddenly have no means of making an income? Will the national leaders shrug and suggest they learn how to code? I don’t think so. There will be a massive populist political revolution. Massive changes will come to be in this country in response to the collective uprising of many in the working class, most specifically, the people who for years kept our country running by keeping shelves stocked, and gas pumps full, and the people who boil and sweat in challenging labor industries.

Thanks to the profound earning power of capital, this country's wealth, primarily concentrated in large cities on the coasts, will continue becoming more affluent and prosperous. The disconnect between these people and the people who have seen their jobs evaporate and who have been left to fend for themselves will make today’s partisan divide seem quaint. In rural America, you have families at the dinner table trying to figure out if they should make the $79 payment to keep the cell phone bill current. In urban, upscale America, young adults crowd together in bars, often multi-million dollar establishments, nocking back 24-dollar Gin and tonics. The discrepancy between these two world experiences is staggering. Without safeguards to protect and empower the Americans who have been left behind in a previous generation, unable to find employment in the high-tech economy that dominates our world, there will be tremendous strife and suffering.

With regards to healthcare, however, my plan removes a lot of red tape (you can say goodbye to sprawling and inefficient Medicare/Medicaid/ACA expansions/Other entitlement payments), and keeps the best of private industry/capitalism in place, while borrowing some of the best ideas of social welfare advocates and advocates of a single-payer system, but without involving sprawling government and suffocating regulation on the people who administer healthcare. You will have universal healthcare coverage; the insurance companies will continue to make money and help streamline the system. Doctors and medical workers will continue to be well paid while preserving key elements of the free market. That element is created by insurance companies competing for your $7000 voucher and competition for higher dollar plans from the higher income earners in this country. Competition and innovation will continue unabated. I would also call for two more things along with this new strategy.

For one thing, malpractice needs to be massively reformed; it costs the healthcare system unspeakable amounts of money, discourages young, intelligent Americans from entering medicine, and dramatically handicaps physicians’ income - with malpractice insurance and taxes, your average doctor is looking at about 60% of his earnings disappearing. In effect, he works for himself for 4/5 months of the year for himself. Additionally, pharmaceutical practices need to be reformed, as shown below.

One, favored nation status must be invoked; the United States can no longer subsidize the rest of the world on medication costs. I strongly support laws that require Pharma companies to charge for their drugs in this country exactly or below par with the cheapest rate they sell their drugs elsewhere in the world. If a new drug comes out, costing 8 dollars in Canada, that drug better not retail for a penny more than $8 in the US market. We lead the world in pharmaceutical innovation; our financial system gives these companies tremendous capital to take risks and develop new treatments. It is only fair that Americans pay no more than other people worldwide, given they are American, and could even have helped finance drug innovation y investing a portion of their 401k into Pfizer or Merk. In return for this new mandate on Pharma sales in this country, I would like to see a financial office of sorts open up under the Department of Treasury with the sole and simple task of providing below-market rate loans to companies working on developing innovative products that benefit the defense or welfare of the American people. After completing rigorous applications, interviews, and examinations, companies share their plans for a product that serves one or both purposes. This department provides significant, long-term financing at far below-market interest rates. These loans would be treated as first lien and must be paid back within a short period following the release and sale of whatever the company was working on. If there is a failure to pay, the IP would be seized, patent rights revoked, and assets seized, and the government would auction off the IP to other industrial players in the market.

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One more bit on healthcare - an idea I’ve been playing with: a hospital must be a utility and should be treated as such. A tax-free entity that has a fiduciary and service responsibility to the people of its area of service. Private practices should be opened up to allow for non-MD ownership. This would create a massive boom in spending as it brings new, fresh capital into the organization - money that can go to better equipment and services. The new environment of solid demand for profitable organizations by outside investors/organizations new in the healthcare sector would create a whole new valuation scheme for practices, valued at a multiple of revenue rather than how it bizarrely works where the value of a practice is based on traditional valuation methods, such as a multiple of revenue or EBITDA. These new valuations for private practices would attract many doctors to the private market - it will also bring many new young men and women into medical schools - an extraordinary situation as currently there are fewer and fewer kids going to medical goal as the e perceived value of that degree which is complicated and expensive starts to attract new generations. I see the private market bidding and paying hospital utilities to access and use the facility’s equipment. The private practice receives legitimacy, infrastructure, and a significant and mandated consumer base (as the hospital becomes a tax-free utility, the government can impose limits and controls on costs/services, and the because of this, the hospital is also granted a de facto monopoly for a specific geographic region.

I would like to see a program like this exist right now, aimed exclusively at the semiconductor market. Many countries have sovereign wealth funds that invest in strategic assets that benefit their home country’s long-term strategic goals, diplomatically or otherwise. Why can’t Congress put together a “Department of Strategic Initiatives” that would be given a very substantial budget of which they can decide how and where to invest, however, guided in their efforts by strategic goals set out by the executive branch of the government? I want to see several hundred billion dollars in cheap financing made available to every U.S. chip maker; I want to see a $300 billion investment made into a large-scale domestic hub built for a multi-corporate chip ecosystem, from design studios to nearby venture capitalists, financiers standing by ready to invest and pour money into activities at an area nearby where multiple semiconductor campuses are located, with the addition of several absolutely massive scaled foundries for chip manufacturing.

Semiconductors are the oil of the 21st century and beyond. China, and even more so Taiwan, is so far ahead of us, only a massive Marshall Plan-type investment will help us close the gap, and even that might not be enough. If China decides to take Taiwan for itself and war breaks out, the global economy will slam to a halt, and regardless of how long the conflict will take, it will take many, many years to recover from that shock; you would be looking at a lost decade or more. I can’t even really begin to fathom the chaos that something like that would cause on every inch of land occupied by humans and a few months of COVID lockdowns in Taiwan completely derailed the world’s supply chains. Imagine what that would look like if the factories that produce all those components were bombed, their shipping ports blockaded, and their factories set ablaze. Something like 95% of semiconductor products is sourced from Taiwan. A war there means no cars, computers, iPhones, appliances, TVs, or anything that has even the tiniest semiconductor in it.

We must create a new silicon valley, focusing on semiconductors and other electronic equipment. I wouldn’t mind seeing the same investment made into desalinization or fission energy, but I won’t go into those issues, as both deserve far more than I can give here. Still, all that I can conclude is that it seems our leaders, from Congress to the White House, have zero vision, awareness of the threats facing us, understanding or appreciation of the rapidly advancing technology that will shape the future, or, importantly, the courage to take bold action that these trying times marked by rapid technological game changers, great societal change, and significant economic upheaval and fundamental realignment call for.

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Moving back to the issue of how you handle a country filled with men and women who have no part of the labor market, who can more or less get any essential products they need thanks to abundant supply enabled and transported by artificial intelligence-guided robotics. When we reach this point, every entitlement and welfare program must end. Those payments, from SNAP, EBT and Food Stamps, Medicaid, Medicare, Unemployment, and many other programs, and Social Security. Altogether, they cost roughly 2.4 trillion dollars annually in federal outlays, but that doesn’t include the annual social security costs. Adding that to our total entitlements and welfare outlays, the total reaches 3.7 trillion dollars. If I had the controls, all that would come to an immediate end. Before you rip this essay up, I’m not suggesting we just stop these programs and do nothing else. I will discuss my closely held beliefs below, and let you decide how to color what I’ve had to say today with those revelations. I am a strong supporter of some of these support programs. I believe social security is an excellent policy, though somewhat poorly executed (if I had it my way, I would be able to opt into a privatized social security benefits account where I would be able to guide the investments made with my money being saved for me, but I realize that is not politically tenable).

I am, in many ways, a right-wing semi-populist with a hint of nationalism. I am conservative on social issues, as well as on several fiscal issues. I am pro-life and profoundly suspicious of the permanent bureaucratic element of the federal government, as well as the revolving door between policymakers, military leaders, think tanks, and lobbying groups These are the people that wield the real power in our Republic, something that upsets me greatly. Regarding social issues... I think the woke establishment and its overwhelming influence on our society is a problem; it provokes racial issues where none lied before, it pushes grossly inappropriate content on young children as has been widely documented, it has terrified countless Americans from speaking their minds, it has shut down academic debate by suppressing all speech that might not fit their narrative, or shutting down facts that don’t align with a specific world view, and frankly, I find most members of this group to be militant, hostile, and rude. Beyond culture war issues, I believe agencies and groups charged with protecting our national security, that is, us, have, with a fair amount of evidence indicating it, abused their powers and have actually done to the American people the very things they were meant to do to bad actors - be it tapping communications, surveilling individuals without a warrant or probable cause, suppressing media stories that could have had a very significant impact on the direction of our country out of purely personal preference by those in power, all the way to, as we’ve recently learned and confirmed, outright censoring hundreds of thousands of Americans, most recently coordinating a significant, partisan effort to suppress and manipulate social media in the heat of a presidential election.

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Regarding social issues that are relevant today, I tend to agree that cops are a little too eager to use physical force and aggressive tactics. Still, I also recognize that they are asked to do an impossible job and that their life is on the line and could have it taken away in the blink of an eye, and as such, I tend to give them the benefit of the doubt. With regards to the economy, I believe that tax cuts are stimulative, pro-growth, and encourage consumer demand, I think penalizing the rich is a foolish strategy, I think reducing costs for employees and wealthy individuals naturally leads to more capital available that can lead to them passing on more income to their workers and friends - especially in a tight labor market. If employers have reduced taxes and therefore more net income, yet if the labor market is tight, and it’s challenging to hire employees, it’s very obvious to me that wages for low-level workers will go up; this is one of the reasons why I dismiss anyone bashing the trickle-down economics of Raegan’s era. I am a sincere and avid patriot supporting substantial investments in defense. One view I think of as a guiding light when it comes to policy questions: I believe government usually destroys, slows, or crushes anything it gets involved in. I am a Republican, but putting me in a specific box is tricky. The way I like to think about it, I am a pacifist US Nationalist who agrees with many Republican policies and beliefs, while also being able to admit when I see value in the concepts, however rarely the proposed implementation, that propagates in Left-leaning circles. If you want to know a little more about what I think and how I feel about specific

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issues and how I see my role as an American, and what that means for the many Americans around me, scroll to the bottom, where you will find an excerpt about an issue that is specifically important to me.

Now seeing those views, you might chalk me up as a classic Republican who is more worried about how much money he is making than the welfare of anyone else. This would be a wildly inaccurate assessment. I have spent much of my life living in Manhattan, NY, in a predominantly prosperous area filled with successful and wealthy individuals. I enjoyed my time there but found it lacking in some critical ways. Despite this having been my environment for some time, I am (and maybe it’s because of that experience in New York) acutely aware and concerned with the challenges facing countless rural and small-town Americans who have been displaced, left unemployed, unable to find meaningful labor, lost in life, addicted to drugs, aimless and lacking dignity that purpose so often provides, often relatively poor, and more and more, angry on a fundamental level.

No further federal or state aid will be paid out from many tiny programs or another. What needs to be done is a complete analysis of money flows, and calculations need to be done to determine what people are receiving. One centralized department in the federal government should be charged with issuing those funds. The size of the government would shrink significantly by shutting down so many programs that divide small amounts of money up into smaller and smaller payments, causing confusion to recipients on where to apply for aid and how to collect, not to mention, requiring tens of thousands of federal workers and the many millions it costs to employ them to administer all of these small payment streams. No, with the future iI anticipate is coming, the best scenario is one in which there is ONE income stream, a sum of the many benefits you might have once received, rounded up to a figure that can provide you the bare minimum a comfortable life. You receive this money, and how you use it is up to you. Remember, you also have a $7000 voucher for healthcare costs. But your income stream from the universal basic income program is yours to spend, however, you see fit. If you choose to buy 40 packs of Camel’s, that’s your right, but no one will step up to help you feed yourself for the remainder of the pay period. We give a lot and expect people to behave responsibly and rationally. The idea of it, if it didn’t conflict so aggressively with my own personal beliefs, is rather beautiful—no subsidy payments from 6 different organizations, plus four more streams from different departments at the state level. (which reminds me, this new system that replaces the various aid programs from the federal government and state would reduce the operating expenditures of the states dramatically, leaving them plenty of resources to improve infrastructure, hire adequate police, and invest in better education for students, as well as other beneficial things for the public at large).

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This would save a lot of resources as the agencies that provide subsidy payments are highly bloated and overstaffed. To be 100% clear, I offer this proposal, but with the demand that social security and any other government programs are immediately ended. The savings would essentially help offset the cost of a Universal Basic Income system. As mentioned before, the government can do much more with less. Productivity gains (through automation or otherwise) will fuel this economic engine, driving economic growth and increased transactions in both the natural and digital world. Steady consumer demand for new technology is a factor that will enhance federal revenue, as in this model, they are taking a small cut of every transaction you make, both in the real world and in the Metaverse. And don’t forget, with the CBDC, money under the table will be a relic of the past. The government will know precisely what you have, what you owe, where you are keeping it, at what outlets you are spending it, and where you are sourcing your income. The Feds will get what’s theirs. If we get a universal basic income, you can be guaranteed that the Feds will do everything in their power to recoup and collect every digital penny they can. What I propose here is scary, concerning, dark, and slightly exciting.

This new economy will work in ways we just don’t understand in today’s world. The idea of a UBI is absurd and seems like some socialist talking point that will never happen. But the trends are in place, and if you extrapolate from today’s circumstances, it becomes much more apparent that something as radical as that will be coming our way. I picture a world where 70% of the population doesn’t participate in the labor force. The remaining 30% will be people that run and direct large businesses, oversee complicated operations, serve in certain occupations that require human dexterity, and a portion of them will be computer coders. However, AI is coming for them too. The cost of coding has collapsed as it has become very easy to outsource complicated coding projects to large coding factories in India that work at very low rates and deliver similar results as their American counterparts. This new economy could really grow fast, and, hopefully, in the long run, reduce our need to spend such a high % of our GDP on defense, as if the country’s economy reignites in this new normal. Productivity continues to surge; we can lower our % spend and still pour tremendous, earth-controlling amounts of money into the defense sector.

User-generated content in the virtual world, creative work, and proficiency at new challenges in the future economy will be the future of our labor market. Given the size of the digital economy and how much room it has to grow, with the Federal government taking a small slice of every transaction — from the 4$ you spent on a new jersey for your avatar, to the $250 you spent on a new virtual bachelors pad, to the $1500 in the real world spent on a new VR headset — we could easily see a scenario where Federal Revenue grows dramatically. Especially if a minimum tax is imposed, requiring everyone to pay $1000, either in aggregate from a portion of their in-game and in-Metaverse spending, or just outright if they don’t participate in that world. I’m not sure how it will all work, and I’m not even sure I will be alive to see it, but I am sure many of these things will come true.

The start of this future will be the day they issue the CBDC (central bank digital currency) while the masses cheer and celebrate, not realizing what has been unleashed and what future awaits them.

**** On Homelessness in America: I firmly believe it’s a moral imperative and a patriotic duty to get every single individual living on the street in poverty off the ground, giving back some dignity with fresh clothing and an opportunity to clean up, and I want them to never return to the street or life in squalor. Yes, many of these people are drug addicts or are mentally unwell. That does nothing to change my mind. It just means we need to do even more to help them find their way to a better track. We live in the United States, the greatest nation this world has ever seen. I look at all fellow citizens as brothers and sisters, ilk that shared fundamental values with me, shared patriotism and committed themselves to self-improvement and upward mobility. I see them as people I would happily go out of my way to help if they needed a hand. So with that in mind, I am genuinely disgusted by the homeless problems our country faces, I see it as a complete and utter failure of the state, from city hall to the oval office. We have the resources and the obligation to lift these suffering Americans up and do what’s possible to give them a small fraction of the joy that most Americans get to experience regularly, from family, a delicious meal with loved ones, success at work, a sports game going your way, and so on.

Breakdown of yearly returns for the last five years for the broader market: ECF: 37% return over five years. Money preserved, none lost. However, given macro conditions, the return is dismal.

What if they just bought SPY and paid no managers: 113% return, minus management costs and salaries or contractors paid for services, over the same period? In 2021, 26.89% return. In 2020, 16.26% return. In 2019, 28.88% return. In 2018, -6.24% loss. And in 2017, 19.42% return. (full disclosure, .095 expense ratio - but peanuts in the grand scheme of things on this one)

Professional money managers usually get some compensation for assets under management, say 1-3% of managed assets. Top-tier managers get a percentage of assets under management PLUS 20% of the total return. That’s called carried interest, and if you manage money, it’s the best part of your job.

I'm only writing this because I'm about to post something else, and it helped me figure out their exact funding situation, which helps me frame what I want to post next. When I realized their return during one of the strongest bull markets of my lifetime was somewhat underwhelming, I had to compare and show how easy it is to win big or miss out substantially, even when you have the best money managers and financial advisors money can buy.

I will build a Wikipedia for Stocks as a trojan horse to get the herd to help me track down and consolidate outstanding fixed-income securities for each firm.

I will use “Wikipedia for stocks” as a free tool to launch a fixed-income brokerage powerhouse. We start with a novel idea, create a Wikipedia for stocks, and guide early users on how to fill it out. The long game is getting keyboard warriors or some other cheap labor to make a robust hub for many marketable securities that are often overlooked, from preferreds and warrants to fixed income. Go to Google Finance, Yahoo Finance, or any other; good luck finding a company’s debt, let alone CUSIP, without going through 100+ pages to find the bond disclosure pages of the quarterly filing. Type in a stock ticker, and the top result would be the stock, which, when clicked on, will transition you into a visually heavy page with all relevant data for someone looking for information on a given stock and an embedded news thread showing any recent and relevant articles. Beyond the first top 25% of the screen, the rest of the capital structure will be outlined and displayed in the remaining screen space below the equity name details and metrics. You will quickly be able to see that company A has one series of preferreds listed, which can be seen in the top 1/4oth of the page, which a total number of preferreds outstanding, effective yield, and other pertinent information detailed. Below that, for this company, there are No Mezzanine Bonds and No Secured notes. However, the company does have unsecured bonds expiring in ’35, ’36, ’37, ’38, etc. By clicking each bond, a screen pops up for the user to graph the bond price over an X and Y axis, with the option to overlay the reference equity overtop the price chart. Along with this chart, pertinent information would be filled out on the right column of the display, and more information would present below the price chart.

Data types to appear on the right include the firm’s Total Cash on Hand. It would disclose the number of days until the bond went ex-dividend. I would like to see other information based on the day of the year. With the date mentioned above of when the bond must make a payment, It shouldn’t be hard to create a cash burn figure that shows the total amount of cash available on the ex-date. Each day, the operating expenses should reflect that timing function in that figure. Ie. A bank has 100 dollars on Monday; the Ex-date is Friday of that week. It would be ideal to see operations’ effect on that $100 going into the dividend date. Suppose operations require $50 from free cash to produce an additional widget. In that case, that $100 cash figure needs to drop to $50 or less, depending on operational requirements, until the dividend is due and 50 dollars is available.

However, what is important here is creating a Wikipedia for stocks. We need a concrete structure for how securities can be written up or analyzed. Wikipedia never instructed its users how to present the information best; they all kept iterating until a more or less system became the default that sees a topic start a page with a quick background on the word, early and easy translations, and a brief sentence or two of what the item is, who the person was, or what the event was, to what the item was used for. This is followed by a somewhat structured series of boxes on the right side where vital information is highlighted and separated from the rest of the content. In this top right structured shelf, you will often find the formal name of the topic of a given Wikipedia page; you will find, in the event of a human, a handwritten signature (depending on how old that is). In addition, you will find out things like what year a company was founded or someone was born, you will find out what academic institutions famous individuals went to, where someone was born and ultimately laid to rest, what military rank they may have learned, the office they served in, the person ranked before him and after im, and so forth. The most essential nuggets you need to know about someone not to be caught off guard in a classroom debate can be found in this section of a Wikipedia entry. The same is true about objects found in nature. All the critical information for a jewel, for example, can be found on its table in the top right of the entry, telling most of the story, while allowing the body of the wiki entry to expand on the details of where the stone was found, who found it, what was the expedition, and so forth. Imagine this, but for a stock. You of course, have your stock name and ticker, and exchanges it trades on around the world, as well as minor exchanges. Then, in that helpful box on the top right of a wiki, you might find out who the CEO is, who the CFO is, where the Headquarters is, when the firm was founded, the number of employees, what markets served, essential products and services, Total revenue, website, subsidiaries, number of employees, and some generic financial metrics like revenue and net income.

You will get a somewhat lengthy history, depending on the company’s age. Some companies go back 100+ years, others, just a few decades ago. Regardless, a. brief history of the company’s earlier chapters is revealed. This is an area where I think improvement can be made when making a stock/equity Wikipedia. For example, when speaking of an old product, further commentary can be provided explaining why a particular product was never tried again or, conversely, comment that this product could have merit with modern technology now surely available to the firm. To me, it’s all about taking rather concrete data, questioning it, and testing it with new propositions. While Wikipedia has its unique format for pages dedicated to public companies, I think that system could be borrowed from and improved dramatically.

For one thing, the company’s history is very important, but sadly, for most people, what happened in 19870-1980 means very little. It’s fun to read and see little hints of what we now know are products barely mentioned in passing comments. I would

like to see a Stock-Wikipedia that starts with a summary and driving mission statement that motivates its workers to come in each day and make amazing new things that will improve our lives. In a true equity Wiki, I would like to see 1, 2, 3, or 4 segments below the summary section of the page. Why? There are four quarters in a year, and I would like a quarter-by-quarter summary of what happened with the company during the most recent year. Did it progress on long-term goals, and did (and where) issues pop up, was market reception consistent over several quarters? The positives, the negatives, the lessons learned, vendors parted with, vendors joined, etc. The detailed reports from the four most recent quarters can provide great insight into what is happening with a company. And the beautify of WIkiX is, while only four quarter periods show up when you first pull up a page, the reality is if you scroll to the bottom of the quarterly reports, there’s a button that will allow you o slide back into the past, so instead of seeing the four most recent quarters, you are now looking at quarters 5,6,7,8, and even further. This ability to time travel and visit a company’s behavior and reception years into the past takes due diligence to another level; as time goes by and more companies work on keeping their pages up to date, you will find many years’ worth of previous data available just simply by scrolling. For companies that don’t want to help backfill their years of market activity, that’s okay too. We have earnings releases going far back in history and recorded Q&As that we can use to put something together for older company data.

Beyond the, admittedly, relatively dry droning of corporate execs trying to spin their quarterly performance in the best possible way, we want to offer more. So once we get things out of the way, such as name, various tickers across global exchanges, complex numbers regarding employees, company financials, websites, logos, birthplace, founders, etc., we can dig into the meat of things and try to foster an evniomrnet where our users can share their observations and the crowd as a whole can give reasonable feedback on the very things that make companies tick - their products and services. A company usually has a range of products, and sometimes they are all related to the same tasks, other times, they are far apart in their function. Nothing can tell you more about a company’s long-term value and success than its product and, very importantly, its track record of taking an abstract idea and turning it into a reality for millions of customers at an affordable price. In my vision, I see the users of WikiX taking things a few steps further than what happens on Wikipedia. I picture a world where our fellow friends and users go out of their way to buy a product, write a review, and do a tremendous job outlining its features while acknowledging its shortcomings.

To be clear, we welcome this and believe it’s this exact type of behavior that will power our platform. No company can succeed when its products are lacking; maybe they can get by for a while, but in the end, bad products always catch up. This is an excellent time to clarify this: WikiX will vigorously defend its pages from bad actors. Writing rosey and over-the-top reviews about current company products without proof of purchase is a sure way to get flagged by our system. At

a minimum, you can expect us to be reaching out. If we find out that a company has financially incentivized someone to do this, that company will find its entire existence expunged from our platform. Integrity is the only thing that gives us validity. If 100 people come onto our platform and right positive reviews/write-ups, and no one offers to draw an opposing picture, we will be inclined to go forward with hosting content that sends praise to a product. Same way in the opposite direction, if a ton of people come to WikiX and find a brand that has a poorly made product, we will not stop those genuine users from sharing their experience. In this scenario, all we will do is reach out to the maker of said product, share the concerns we’re hearing, and ask for a comment from a registered representative from the offending brand. If we don’t get a quote, then so be it! The crowd will have spoken, and we will have moved on as a community.

So once we get the critical company details out, the total number of employees, what exchanges it’s listed under, what type of company it is, what industry it serves, who its top employees are, what its operating income is, net income is. A host of other more minor details, we then move to our more extended product review portions of our WikiX. In these sections, I hope every company on WikiX has its entire product universe listed, defined, and explained on our pages. So many people look at companies for specific ratios and growth trends. Those things can be great, no doubt about it. But it’s only telling you a part of the story, and by stopping there, you may be correct, but with a little more work, you can go from “kind of sure,” instead of, “this is a home run.”. The United States is increasingly a services-based economy, but the reality is that many companies we as Americans invest in ultimately dominate our Corporate registry. I can think of several times in my life, probably many more if I thought about it, where I found a product, whether it was a gift to me, something I came across at school, or a friend showed me where I thought, “Wow.” It occurred to me within a minute of holding and using it that what I had in my hand represented a sea change in the way consumer devices would be made and what their target audience would be. Maybe the most profound type of incident I just described that had had the longest-lasting impact on my life, for over a decade now, was when I waited in line all day for a company to release a new product in a new field that it had never attempted to enter before and whom many believed would be doomed. That was when I opened my 2007 iPhone 1 at 6:01:30. Yes, 1 minute and 30 seconds after the item officially went on sale - now that’s so quant; who doesn’t order their iPhone to their house these days! But I digress; I want to build a platform where excited users, like I was on that day in 2007, and even frustrated users can come together and, through the wiki’s version of survival of the fittest, let the best ideas and opinions float to the top. Everyone has the right to edit a section, but if you hold position A and 99 other people hold position B, the reality is that position B will be the dominating point of view. As a function of that, I recommend making friends to help you get your take out there. Also, the tyranny of the majority can be a problem, so I am building in a safeguard; if you have a product or are using a service and the

experience has been absolutely terrible, my email address will be available. You are welcome to share your experience with me. At that point, my team and I will determine if your feedback should be incorporated into what is presented on-site at the wiki.

So product by product, segment by segment. Some products fit under a segment; others fit under another segment. To remedy this, we will make segments available for products or services of a specific type. With that framework, you can then write and publish your feedback on the specific products, from their pros and cons, to how it fits in with the broader segment group, what features they should have, and what they could dial back. The reality is that these products ultimately make or break public companies. You can have some wrong products or an inadequate business model/services. Still, with some financial gymnastics, you can make things look good or even great for a while, but if the work product your company is putting out is lacking or way behind the competition, the company’s fate is not far behind. So we will focus heavily on the products and the companies’ roadmap in our WikiX reports. Beyond that, We need to give our users as much information as possible about these companies. the whole idea we’re trying to accomplish is to be a one-stop shop for understanding a company, knowing how it’s built, whom it is comprised of, or even the color of strategic partners.

We must outline highlights from a company’s forward-looking guidance each quarter to update the financial metrics and charts we share on the wiki page for a given stock. So much information becomes public on a conference call. We will be listening diligently to make sure any changes, no matter how minor, find their way onto our disclosures in the finances section of a specific page. We plan to provide an audio replay of earnings calls in the near future, and we will have transcripts even sooner. We want to take in as much data as possible, then distill it to only the most essential elements. While our site is undoubtedly open to anyone, and hopefully many find it interesting, the actual end user, as we envision it, are people like you, people who trade or invest regularly, whether that’s part-time or full-time; we welcome everyone and hope to provide the value you deserve and earn a degree of comfort on your end when you click on one of our properties knowing we are committed to the raw truth and will do whatever we can to make it easy for you to parse and work with.

While we are focused on providing you with all the top-level information about a given company, who runs it, what revenue it has, what country it operates in, etc., we also have another, maybe the most important, element to touch on. It doesn’t take a financial genius to say, “companies have bonded.” However, you may need to be a financial genius to go through the process and buy a bond! Countless stocks in the American Stock universe, from NASDAQ to NYSE, also have outstanding bonds. These bonds can be very hard to find, as, as far as we know, there aren’t any great sites to type a company ticker into and get a result of

several bond identifiers. A CUSIP identifies bonds; it’s like a ticker, just a little longer! The bond market is primarily done over the phone between one banker and another. It is a little crazy, it’s 2023, and the best way to get a bond is to call a broker and hope they give you a fair price. If you want a bond, you must call a few brokers, and you will likely get 3-4 different prices. That’s the downside of no exchange; there are ways to get transparency into the bond market and what prices they exchange, but there is no screen where I can close a bond at 97.75. If I bought a bond at 96 during a period of distress a few months ago, and then wanted to sell that bond because the cash was needed for something else, I would call my broker, who, in turn, would call other people that he knows covers similar markets where that bond trades, and he might get back an “Uh Ya I can fill that, looking for 97.25.” Of course, this is frustrating, but the reality is that you are at the mercy of the guy on the other end of the phone, and you have no sure guarantee that you’ll be able to sell it above that or at the price you want. So the bond market has a long way to go; I’m sure in the next 20-30 years, bonds will get listed on exchanges like stocks, but that day is not now. The bonds are brought up because it’s such a vast portion of what makes up our financial system, and virtually all public severe companies have issued bonds, not to mention every single unit of government with obligations. Municipalities issue enormous bonds; paper builds our roads, bridges, and other improvements. It’s essential to bring up, though, because currently, there is no quick or elegant way to look up a company’s bonds. To find out what bonds a company, such as Berkshire Hathaway, offers, you have to go into the most recent quarterly filing for Berkshire, find its CUSIP, then find a service that lets you look up CUSIPS - of which there are no many. So beyond an introduction into the company, who runs it, what its recent corporate history has been, who serves as managers, what’s its net income, what ticker does it trade under in my jurisdiction, where is it head quartered, and who’s the current CEO are all excellent questions., as are questions about what products is it currently offering, what demand has been like for them, what the supply/demand balance is, when will updated versions release to update a stagnate product line, what products does the company depend on to drive holiday sales, these are all really good questions. what we are left with is, how do I invest in you? Does it make sense for me to buy the equity outright? or do preferreds make more sense? Or, for that matter, maybe I should buy the bonds that mature in 2033 carrying 7% - I mean, 7% every year for ten years is pretty good! Regardless of your timeline for investing, we want to bring you 1. the company. 2. the critical company figures 3. the industry/sector served and located 4. Whos in charge 5. what products are out and what ones are coming out in the near future, 6. what type of people make up its senior management, and 7. what security makes the most sense to buy? Do I buy equity? I hope it keeps appreciating. Does it make sense to play into the rate environment and buy 3-4-5 year bonds? Regardless of the questions and circumstances, readers of WikiX will have to wrestle with, we will do our best to ensure all the information needed, and some not needed, will be cleanly and clearly detailed on our wikiX platform. We hope you come back to check us out as

Erie's entire real estate market value is just around $3 trillion. There is a small group in Erie whose mission is to advance the region and drive prosperity in Erie, but it seems as if they don't know their power or how even to use their balance sheet. They are excited by shiny graphics, powerful flow charts, and buzzword-filled mission statements, but they look anxious to use their money from where I stand. They want transformational change. That is very fair; I agree with that objective big time. The problem is they zoomed too far on a tiny project with lousy economics. They are focusing on one real estate development project on one intersection of Erie that was already doing fine as far as I could tell. It is a hedged bet. Sure, it seemed like people ate, went out for drinks, got coffee, etc., but that wouldn't be enough, never mind what could be potentially poor execution. All the Buildings (All the EDDC buildings, north park row, 4th street McDonald, adjacent lot) were bought very quickly before essential questions could be answered. The current tenants on North Park Row were swiftly informed that their lease would be terminating asap and to start looking elsewhere, and then more property has purchased a block down. From my perspective, and I could be wrong, it looked like a group suddenly found themselves with a nice pile of money and were told if you don’t spend this money within five days were taking it all away. It only seemed more so as they splashed the money around and quickly piled up a list of properties and more than a few fawning media hits about the change and transformation they were bringing to lower State Street. Basically, they had a fair amount of money and tried to figure out how to spend it all at once and parlayed that into chalked-up immediate wins to keep[ the media hype going. If you paid attention to the media, including national outlets, you would think a miracle had occurred; that lead was turned into gold through some super cunning use of opportunity zones (of which erie had the highest number of designated zones in the state, maybe even the country) made and defined by the recent 2017 Tax Reform legislation. When EDDC started its media campaign, it was pedaled to the floor. The accolades came flying in and then were repeated regularly. Each passing day was another major milestone. This went on for so long that at one point, no exaggeration, the head of the EDDC used a video hit to show off his eddc branded pens as if this was news that was somehow relevant to anyone in erie other than the pants of the person showing off the pen. These pants had a valid concern about the pen leaking. I joke, but for a while, EDDC dominated Erie news, and every day was another headline.

In some ways, I think the media unintentionally set them up to fail. With such high levels of hype and excitement, the bar was set very high daily, and the reality is that a lot of this stuff is boring number crunching, meeting with contractors, measuring lengths, etc. Eventually, when they made a large event by opening their new permanent office wearing hard hats, I think that was the high water moment. From then on, media coverage of EDDC started trending back to zero. That is until curling appeared. That gave the EDDC another 5-7 days in the media sun, but again, sadly, it didn’t give much color or information on the broader project and its long-term goals. To this day, I am unclear as to what the total project is to look like. I know they are building a fair number of rental units; now whether I think they can command top rents for those units is a totally different subject. Also, I am still unsure how the other properties on north park row fit in with it all. I believe my early suspicion that they bought first and asked second is backed up by the fact that a handful of buildings/units on north park row, originally purchased by EDDC, are now for sale or available to rent at very low rates.

a great example is that while several business owners lost their businesses, I need to be clear about the future of north park row. There aren't any clear visions for how all of this will come together, something that speaks for itself. From what I've heard, the businesses that have tried to make it on NPark row are struggling or can only down already. We can't make Erie a boutique destination overnight because we decided to have a food court. These things take time and entire industries to build up to support the incomes necessary to keep these things alive. And as far as the housing project goes on 4th and State, I've run the financials many times. Most of the numbers are matters of public records. Anyone that wants my workup data don’t hesitate to ask. I'll send it your way, and you will know immediately. I don't see how it will work without equity and debt getting reshuffled (that's an excellent way of saying court-ordered restructuring, aka bankruptcy) Unless the population does a massive u-turn. We start gaining residents quickly, a new tech or other economic hub comes to fruition, or another significant change happens. I don't see how the apartment complex ever manages to pay back what was put into it, and I won't even mention the new, 183124th huge ugly garage in downtown Erie. To me, the project seemed rushed; it was put in the hands of someone with no real experience with development or anything related to it - running for mayor was a tough challenge, but it also has nothing to do with real estate development, civic planning, business management, finding elements that fit well with each other, etc. and this is NOTHING against the person who had the role, it’s just a calculated assessment of what happened.

I would love to be wrong, but from where I sit, some folks got excited about the Opportunity Zone legislation and rushed to shove money out the door and buy properties. Some properties are now back on sale in the open market at discounted rates, which tells you a lot. I suspected this was done with the mindset of, please, once we get the properties, we will have plenty of time to figure out what to do with them. From what I’ve observed and heard over the past year or two, I have no reason not to think my hunch is somewhat accurate.

To be very clear, I want these good things to happen; I've lived most of my life in Erie and the remainder in Boston or N.Y.C. I have seen what can be done with once-neglected space, how unconventional buildings can be repurposed, iv seen communities come together with concrete plans and I've watched those plans materialize. It can happen here, but we need to think before spending all of our cash reserves and figure out how the people around a development site will react to their property - hopefully in concert with you if the proper conversation is had! But I digress; I think it will take much more than north park row getting slightly fixed to turn things around in our city. We need at least one of a range of a few things, 1. an economic miracle, 2. a Marshall Plan level program to rebuild Erie, 3. national trends to swing massively toward younger children returning to hometowns, or 4. one or two more large companies going public in the Erie area. One of those things CAN happen, an organization begging to make a change in Erie and put us on a new path and put radical transformation to work is just standing by with $357mm on the sidelines, waiting to make a move. Fixing Erie will take a lot more than 350mm. Still, I think it fair to say that the Erie Community Foundation has 1. good relationships with many well-off individuals and families, 2. good bankers who will go out of their way to keep them as a client and get them hooked up with great benefits for using their bank, and 3. a large social graph that helps them stay on top of what’s going on all across the city. I think an ECF-led Marshall Plan could be what we are looking for. I trust their intentions, and we are losing hope regarding saviors. I'm domiciling my business here in Erie, but don't hold your breath, folks; there’s only so much I can do! However, many really special things could be done with the ECF, with its 357m in the bank plus its banker contacts and its influence in city hall and county.

For context to help make this more believable:

ECF lists 357mm in assets. The Erie property market is 3,000,000,000. Many tax-exempt portions are Mercyhurst, UPMC, St. Vincent, Gannon, and other nonprofits. Much of that market value comprises blighted homes, neglected neighborhoods, run-down buildings, neglected offices, etc. You might ask, how are they supposed to fix that with only 357m? Very simply. Using their banking contacts, it should be within their reach to raise at a 4:1 or 5:1 level, meaning 1.785bn is theoretically available to impose transformation and improvement. And it doesn't all have to be giving things away; in fact, as far as I'm concerned, the smartest thing the ECF could do with its balance sheet is spin out a REIT, a real estate investment trust (90%+ of its assets have to be real estate, and it must pay a dividend as a function of the rent it collects, and for those limitations, its afforded generous tax treatment and can only use funds to improve its properties or return those funds to shareholders.) In the scenario I propose, ECF would build out a REIT and then, with the help of Erie Insurance, launch it as a free-standing REIT that you could buy or sell just like any other stock on the stock market, and ECF could fund it with 100mm, lever it up to 500m with financing from banks, and then go throughout Erie, systematically buying up neglected homes and neighborhoods, fix the areas up, put in the security systems that will stop crime or at minimum, catch perpetrators who can then be dealt with later. 400mm is a sizable chunk of a three-billion-dollar real estate market. That means 1/6 of the Erie City market is fair game. Spend the money, hire someone who demands a multi-million dollar salary (as he or she likely has the results to justify it, not to mention a huge Rolodex of serious contracts, financial or otherwise), who has a track record of reviving post-industrial cities, and has proven he knows what it takes to reinvigorate run-down areas. All of this would dramatically impact Erie for the better. Crime policy thinking shows that a less trashed, more well-kept area reduces petty crime/ vandalism incidents. Fixing neighborhoods and tearing down countless blighted properties that might have made sense when Erie was a city of 150k, but it no longer makes sense today at our current population of 97k. Where those properties once stood, return the plots to earth, take them green, and rehab the land to someday grow into fruits, vegetables, greenery, and more. Building parks and walking green spaces where those abandoned properties once stood. This is the way forward for Erie. I have gone on too long but I will end with this sign-off. What's the point of being an incredibly well-endowed foundation, to the tune of ~360mm, with a community focus, if you are too apprehensive about using your money or drawing down on your endowment? At the very least, set up a subsidiary LLC modeled after a venture capital fund and achieve philanthropic goals through market-driven competition. Erie has poor access to financing and funding for entrepreneurs. Commit 25mm and then call on other large firms in the area to match with an additional 5mm each to form the first bay city venture horizon fund LLC (just riffing, naming it is the easy part). We have resources; we have ideas; we have hungry people. Let’s get it coordinated, and let’s get it going! Sadly, I guess, you could keep waiting, and someday you’ll ultimately get to 2 or 3 billion in endowment funds, but by then, will there be much of a city left to save? My advice, move now, boldly, and swiftly. We are rapidly approaching a point of no return for our community, and I worry that we have reached that point in some areas of our community already. Sadly, this is true in some ways. But nothing is irreversible.

An all-out blitz by holders of private-public dollars, development capacity, and resources, and residents vested in long-term change is ready, just waiting for a significant economic breakthrough or a coordinated message from civic leaders on how to deploy their resources in the best way to put our shared ship back on its leading path, front, and center of the fleet. Many are hoping and waiting for a start-up to form here and take wings, and this could be a considerable development/breakthrough for our community. Still, start-up or no start-up, we have all that we need to put us on a better path and start serving as an example city to others on how to move past the rust belt days rather than be consumed by them and fade into the darkness of history. Erie's entire real estate market value is just around 3 trillion. There is a group in Erie, whose mission is to advance the region and drive prosperity in Erie, but from my perspective, they don't know how to use their power or balance sheet. They are quickly excited by shiny graphics, powerful flow charts, and mission statements, but from where I stand, they look scared to use their money. They want transformational change. That is very fair; I agree with that objective big time. The problem is, focusing on one real estate development project on one intersection of Erie that was already doing fine as far as I could tell, sure seemed like people ate there, went out for drinks there, got coffee there, etc., that won't be enough, nevermind how it was poorly executed. Buildings were bought very quickly before essential questions could be answered, tenants were swiftly informed their lease would be up asap and to start looking elsewhere, and then more property has purchased a block down. From my perspective, and I could be totally wrong, it looked like a group found themselves with a fair amount of money and tried to figure out how to spend it all at once and chalk up immediate wins. If you paid attention to the media, including the national, you would think a miracle had occurred; that lead was turned gold through some super cunning use of the Ozone status. The accolades came flying in and then were put on repeat locally. I'm still not sure what they were for.

A great example is that while several business owners lost their businesses, the future of north park row is in question, and there aren’t any clear visions for how all of this will come together, something that speaks for itself. From what I've heard, the businesses that have tried to make it on North Park Row are struggling badly or are shut down already. We can't make Erie a boutique quarter of Pittsburgh overnight because we decided to have a food court. These things take time and entire industries to build up to support the incomes necessary to keep these things alive. And as far as the housing project goes on 4th and State, I've run the financials many times. Most of the numbers are matters of public records. Anyone that wants to see my workup data don’t hesitate to ask. I’ll send it your way immediately. I don’t see how it will work without equity and debt getting reshuffled (that’s an excellent way of saying court-ordered restructuring, aka bankruptcy) Unless the population does a massive u-turn. We start gaining residents quickly, a new tech or other economic hub comes to fruition, or another significant change happens. I don't see how the apartment complex ever manages to pay back what was put into it, and I won’t even mention the new, 183124th huge ugly garage in downtown Erie. To me, the project seemed rushed; it was put in the hands of someone with no real experience with development or anything related to it - running for mayor was a tough challenge, but it also has nothing to do with real estate development, civic planning, business management, finding elements that fit well with each other, etc. and this is NOTHING against the person who had the role, it’s just a calculated assessment of what happened.

I would love to be wrong, but from where I sit, some folks got excited about the Opportunity Zone legislation and rushed to shove money out the door and buy properties (some properties are now already back on sale in the open market at somewhat discounted rates, which should tell you a lot. I suspected this was done with the mindset of, oh please, once we get the properties, we will have plenty of time to figure out what to do with them. From what I’ve observed and heard over the past year or two, I have no reason not to think my hunch is somewhat accurate.

To be very clear, I want these good things to happen; I’ve lived most of my life in Erie, and the remainder in Boston or N.Y.C., I have seen what can be done with once-neglected space, how unconventional buildings can be repurposed, iv seen communities come together with concrete plans and I've watched those plans materialize. It can happen here, but we need to think before spending all of our cash reserves and figure out how the people around a development site will react to their property - hopefully in concert with you if the proper conversation is had! But I digress; I guess my point is that it will take a lot more than north park row getting slightly fixed to turn things around in our city. We need at least one of a range of a few things, 1. an economic miracle, 2. a Marshall Plan level program to rebuild Erie, 3. national trends to swing massively toward younger children returning to hometowns, or 4. one or two more large companies going public in the Erie area. One of those things CAN happen, an organization begging to make a change in Erie and put us on a new path and put radical transformation to work is just standing by with $357mm on the sidelines, waiting to make a move. Fixing Erie will take a lot more than 350mm. Still, I think it fair to say that the Erie Community Foundation has 1. good relationships with many well-off individuals and families, 2. good bankers who will go out of their way to keep them as a client and get them hooked up with great benefits for using their bank, and 3. a large social graph that helps them stay on top of what’s going on all across the city. I think an ECF-led Marshall Plan could be what we are looking for. I trust their intentions, and we are losing hope regarding saviors. I'm domiciling my business here in Erie, but don't hold your breath, folks; there’s only so much I can do! However, many really special things could be done with the ECF, with its 357m in the bank plus its banker contacts and its influence in city hall and county.

For context to help make major positive change more believable:

Erie Community Foundation lists 357mm in assets. The Erie property market is 3,000,000,000. Many parts of the tax-exempt portion are Mercyhurst, UPMC, St. Vincent, Gannon, or other nonprofits. Much of that market value comprises blighted homes, neglected neighborhoods, run-down buildings, neglected offices, etc. You might ask, how are they supposed to fix that with only 357mm? It's very simple. It takes two parts chutzpah and 1 part familiarity with financing. Using their banking contacts, it should be within their reach to raise to a 4:1 or 5:1 level, meaning 1.785bn is theoretically available to finance transformation and improvement. And it doesn't all have to be giving things away; as far as I'm concerned, the smartest thing the ECF could do with its balance sheet is spin out a REIT, a real estate investment trust (90%+ of its assets have to be real estate, and it must pay a dividend as a function of the rent it collects, and for those limitations, its afforded generous tax treatment and can only use funds to improve its properties or return those funds to shareholders. In the scenario I propose, ECF would build out a REIT, take it to NYSE, list it as an ongoing REIT, sell all its shares in its offering, recoup a considerable amount of the money it spent building it, and let the REIT trade free-standing, with small residual payments, kicked back to the ECF and the new operating group who is tasked with managing the REIT now finds themselves responsible for keeping up the property and ensuring the value of its holdings do not go down. This could be done even more smoothly with the help of Erie Insurance, launching it as a free-standing REIT that you could buy or sell just like any other stock on the stock market. Buy 100mm houses in the City of Erie market, define the trust entity that holds them, take the trust through the ropes of going public, and in short order, Erie real estate can be tapped into and funded by anyone in the world with a brokerage account. They could go even further, use the 100mm, lever it up to 3-400mm, buy vast swaths of underdeveloped or neglected properties, use proceeds to fix properties and get them rentable, even up to 500m with financing from banks. Then partner with another large co, for example, Erie Insurance, and systematically buy up all the neglected homes and neighborhoods, fix the areas up, and put in the security systems that will stop crime or, at minimum, and at worst, catch perpetrators who can then be dealt with later.

400mm is a sizable chunk of a three-billion-dollar real estate market. That means 1/6 of the Erie City market is fair game. Spend the money, hire someone who demands a multi-million dollar salary (as he or she likely has the results to justify it, not to mention a huge Rolodex of serious contracts, financial or otherwise), who has a track record of reviving post-industrial cities, and has proven he knows what it takes to reinvigorate run-down areas. All of this would dramatically impact Erie for the better. Crime policy thinking shows that a less trashed, more well-kept area reduces petty crime/ vandalism incidents. Fixing neighborhoods and tearing down countless blighted properties that might have made sense when Erie was a city of 150k, but it no longer makes sense today at our current population of 97k. Where those properties once stood, return the plots to earth, take them green, and rehab the land to someday grow into fruits, vegetables, greenery, and more. Building parks and walking green spaces where those abandoned properties once stood. This is the way forward for Erie.

I have gone on too long but I will end with this sign-off. What's the point of being an incredibly well-endowed foundation, to the tune of ~360mm, with a community focus, if you are too apprehensive about using your money or drawing down on your endowment? At the very least, set up a subsidiary L.L.C. modeled after a venture capital fund and achieve philanthropic goals through market-driven competition. Erie has poor access to financing and funding for entrepreneurs. I think this needs to be fixed. Even though our access to financing for a property is suspect in Erie, it can be hard to find a bank that will do a fair ReFi with you, let alone anything more exotic than that. Commit 25mm and then call on other large firms in the area to match with an additional 5mm each to form the first "bay city venture horizon fund L.L.C." (just riffing, naming it is the easy part). We have resources; we have ideas; we have hungry people. Let's get it coordinated, and let's get it going! We have the opportunity. As for the ECF, you could keep waiting, and someday you'll ultimately get to 2 or 3 billion in endowment funds, but by then, will there be much of a city left to save? My advice? Move now, boldly and swiftly. We are rapidly approaching a point of no return for our community, and we have reached that point in some areas of our community already. Sadly, this is true in some ways. But nothing is irreversible. Only an all-out blitz by holders of private-public dollars, development capacity, resources, and residents vested in long-term growth ready for change just waiting for a significant economic breakthrough or a coordinated message from civic leaders on how to deploy their resources in the best way to put our shared ship back on its leading path, which is rightly at the front, and center, of the fleet. Many are hoping and waiting for a miracle tech start-up to form here and take wings, and this would be a considerable development/breakthrough for our community. However, start-up or no start-up, we have all that we need to put us on a better path and start serving as an example city to others on how to move past the rust belt days rather than be consumed by them and fade into the darkness of history as countless smaller rustbelt communities have done before us.

This dynamic is especially true during emergencies. I've never seen an emergency program truly end when an emergency passes; it just becomes a new permanent part of the status quo. Unfortunately, when a program is crafted during an emergency, its reasonable to assume it was quickly conceived and rushed out the door, with little thought given to creating safeguards against abuse or designing it in the most efficient, cost-sensitive manner and effective way possible. Our recent COVID experience is filled with examples that prove those things to be true.

Furthermore, a natural and obvious byproduct of a temporary program becoming permanent is new and increased taxation going forward, although the emergency has long since ended. Of course, there is another option to meet the new funding demands, which is increased borrowing. Thus far, that is how our country has paid for all of the COVID-related spendings. However, that approach is temporary, kicking increased taxation down to a future generation.

This dynamic is a big reason why the size of government is so incredibly massive and will continue to grow, year after year. A great example of this is a program we all know and will use at some point in our life. It's also one of the federal government's most significant expenses. That is, Social Security, a program initially meant to be a short-term policy response to help improve the labor market during a severe depression by making room for younger workers and providing financial security when such a thing was scarce at best. To be very clear, this is not a commentary on whether it's a good or bad program that should continue or not (it should). It's a crucial support program that makes a lot of sense from a public policy perspective and ensures dignity for those later in life when working is not a realistic option. Not to mention, it's rightfully the recipient's money, having spent a lifetime paying into it. I only chose to use it as an example as it is the largest and most well-known example of a short-term policy response becoming a permanent fixture of government.

At the end of the day, once you give voters something, especially something financial, it becomes virtually impossible to take away in a democracy like ours. Why would anyone vote for someone trying to take away an entitlement or funding for something that benefits the voter? It's an understandable and natural behavior, so the government should always be slow and deliberative in funding new things, even in an emergency. Maybe most importantly, in an emergency, as rushing funding out for quickly drafted legislation is ripe for abuse. There are countless stories of COVID-related funding being abused, with endless instances of "emergency" money ending up in the wrong hands.

As they say in government, "never let a good crisis go to waste."

The Fed will likely have to raise rates (25bp per meeting) several more times and then, keep them wrapped in their terminal rate for the foreseeable future. This is a headwind to economic growth and stock price performance (a considerable portion of the country is exposed to that fluctuation, from those with savings, private retirement plans, and pensions). We aren’t out of the woods yet.