Great Leaders, Smartphones Calling Trade and Venezuelan Origami

We’ve noted our worries about automation displacing human jobs before, but it’s also possible that at least in the mid-term, the worries are overblown as we were reminded when reading an article recently that asserted truck drivers’ jobs would change, not be eliminated, with the advent of self-driving trucks. Of course, some jobs we may welcome the elimination of, perhaps because they are too dangerous or risky. Or in the case of the job we read about being at risk this week, too smarmy. Yes, it turns out lobbyist jobs are at risk to automation. According to Politico, the company FiscalNote has developed a software platform that is superior to humans at predicting what Senators and Representatives will do on an issue, who best to work with to form an alliance on a policy and how to get your bill through Congress, or alternatively, stop it from getting through the sausage making machine. The article notes that the “system analyzes interests, not just people, and quickly summarizes everything knowable about who is trying to pass what kind of rules about the most obscure topic…” FiscalNote is essentially bringing sabermetrics to politics. Of course, defense, corporate, environmental, human rights and all other lobbyists are likely to become the strangest bedfellows ever as they join together to lobby against the implementation of such technology. In the meantime, we manually inform you of a title change in China, the impact of smartphones on international trade and Venezuelan origami. It’s this week’s International Need to Know, telling different stories of import each week while the White House changes their story every day.

Without further ado, here’s what you need to know.

Great Leaders?

Titles are important to some people. I’ve known a number of people with PhDs who insist on being called doctor which is understandable given all the time and effort they put into earning the PhD. Chinese leaders can be very particular about titles because a title signifies much of importance. So we read with interest in Bill Bishop’s invaluable Sinocism newsletter the latest on President Xi Jinping’s title elevating efforts. Bishop reports that Xi now officially appears to be dubbed lingxiu, or “leader,” the first to receive that moniker since Deng Xiaoping and Mao. High level company indeed (and in Mao’s case, worrisome company). This moniker elevation first occurred in a January 14th article in the Global Times so we’re a bit late to the title party, but it doesn’t appear to be getting as much notice as say, Kim Jong-Un’s sister so we raise it here. As was noted in the article, “The word lingxiu means more than just a leader. It is often bestowed to a leader who enjoys the highest prestige, who is the most capable and who is widely recognized by the entire Party.“ That was January. Earlier this week the People’s Daily and CCTV published a video cementing Xi’s title which you can watch below. Over two years ago we noted that Xi is the most impactful Chinese president since Deng. Now he’s got the title to prove it.

人民领袖:习近平
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Smartphones Calling Trade

A while back smartphones replaced computers as humans’ device of choice for distracting themselves from existential questions, bothersome family issues and having to engage in time-consuming human interactions, as you can see in the first chart below. The International Monetary Fund (IMF) has been quantifying how important smartphone production is to a variety of countries exports. For example, smartphones account for 5 percent of China’s exports, about $107 billion in 2016. In South Korea, smartphone component production accounts for an astonishing 17 percent of that country’s exports. For Taiwan, those germ incubators account for a third of its exports. Other countries heavily reliant on smartphones for their exports include Singapore (15%) and Malaysia (11%). The IMF study also notes that Apple iPhone release dates have a huge impact on these countries’ tech cycles. But the study also notes the smartphone market may be becoming saturated, perhaps peaking in late 2015. “China’s domestic smartphone market declined in 2017 for the first time, and Apple recorded a year-on-year decrease in iPhone sales in the fourth quarter of 2017.” This has led to smartphone exports from China peaking towards the end of 2015, at least so far. And, of course, some of that could be due to more components and assembly happening outside of China—Korea and Taiwan semiconductor exports continue to increase. We’ll keep you updated by looking up the latest data six months from now, on our smartphone, of course.

 

Venezuelan Origami

A few weeks ago we pondered whether Bitcoin is a legitimate currency or even a long-term viable form of payment. But now comes news that certain sovereign currencies are worth more by being used for other purposes than as money. In Venezuela, where the economy has shrunk 33 percent over the last five years and where this year’s inflation rate is currently 13,000 percent (that is not a typo!) lower denomination paper bills are essentially worthless. Well, as money at least. But one enterprising Venezuelan has been taking two, five and ten-Bolivar notes and using them to create handbags which he then sells for much more than the worth of the currency itself. As the Taipei Times tells us, “Enter Wilmer Rojas, 25, who scoops them up off the street, uses an origami-like folding technique, a needle and thread to make handbags with an eye to selling them — maybe even abroad, where people have real money.” Rojas says Venezuelans throw away such bills because inflation has made them worthless. He collects them, makes his handbags, sells them and provides for his family. “You can use magazine paper or newspaper pulp, but currency notes are better because they are not worth anything, they are all the same size and you don’t have to waste time cutting them,” Rojas said. International customers are paying him $20 per bag. If you find yourself in Venezuela, we highly encourage you to buy one. Maybe cat cryptocurrencies aren’t as crazy as we thought.

A Lost Generation, Are all Unicorns the Same Color, & Self-Driving Slippers: The Sequel

For reasons we won’t go into here, we’ve been researching the TV show, This is Us, which led us down a tangential rabbit hole researching the song, Blues Run the Game, which led to reading up on Jackson C Frank, who wrote the song, and who has the seventh saddest Wikipedia write-up ever. If you are ever despairing of your life, whatever you have to mourn—and we all have something—just remember yours is unlikely to be as dire, tragic or painful as Frank’s. Born in Buffalo, NY (tragic enough in itself, Ron Armitage), at age 11 a fire broke out at his school killing 15 students, including Franks’s then girlfriend, Marlene, who he later wrote a song about. Frank himself suffered burns on 50 percent of his body. Frank recorded his only album as a young man while living in England. The album was not a popular success and things went from bad to worse for Frank personally. Frank lost a son to cystic fibrosis and later  suffered severe mental health issues that led to his being institutionalized and later to becoming homeless. Years later one of his fans found him and hoped to help him to begin recording again. But before this happened, Frank, sitting on a park bench in Queens, NY, was shot through the eye by a pellet gun a kid was shooting indiscriminately in the neighborhood. Eventually Frank died of pneumonia and cardiac arrest at the age of 56 in 1999, unknown, broke and alone. His music did not save him but continues to stir millions, including viewers of This is Us. It is of no solace to Frank, of course, but even the most tragic life can have hopeful impact. We hope to move you about Europe’s lost generation, sing the blues about unicorns, and provide a sequel to self-driving slippers. It’s this week’s International Need to Know, attempting to be the Jack of international news and data.

Blues Run The Game–Jackson C. Frank (From Vi…
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Without further ado, here’s what you need to know.

A Lost Generation?

We noted a number of months ago that Europe’s economy has been recovering after a long, dark economic night resulting from the financial crisis. But for Europe’s youth, no dawn looms. At the height of the great recession, in some EU countries the unemployment rate for youth hovered around 50 percent. For the EU as a whole, a quarter of young people were unemployed. That is no longer the case but even today, nearly a fifth of young people in Europe are unemployed. As you see in the chart below, the difference between youth unemployment and employment for older people is stark. Young Europeans are starting from behind with little hope of ever catching up to previous generations. Like the lost generation of World War I, this will have long and worrisome impacts. As the IMF writes, “after long spells of unemployment and with limited experience, the young are less likely to find work. If they do find it, it will likely be at lower wages. Wages not earned and savings not put aside can be extremely difficult, if not impossible, to recover later in a person’s career” Old policy makers have run the youths’ blues long enough and need to make rescuing the lost generation a higher priority.

Are all Unicorns the Same Color?

I hate the term, “unicorns,” especially as it’s now being adapted to NBA players. But, even in its traditional finance definition (a privately held start-up company with a valuation of $1 billion* or more) it grates on our senses. So I somehow type this post while covering my ears with my hands. But we were intrigued, when researching which countries are home to the most unicorn companies, by how two countries utterly dominate. Three-quarters of all unicorns graze in only two countries, China and the U.S. Remarkably, in 2017, as Ian Bremmer recently pointed out, only four unicorns came out of Europe and those were all in the UK. But in 2017 the U.S. saw 32 leap up and China witnessed 18. China is just behind the U.S. in total unicorns, not just ones born in 2017, as you see in the chart below. India is a distant third. Chile is the only South American country with a unicorn. There are lots of forests in our world but only a few are producing these creatures.

*We question how many of China’s unicorns are truly “privately”  held.

 last week’s story on self-driving slippers.  After starting this week with a rumination on tragedy and two not entirely uplifting stories, we are grateful to eagle-eyed reader, Dave Billings, for pointing out this video of Nissan’s self-driving chairs he stumbled across inspired by the self-driving slippers. The technology. The music. It is clearly destined to be one of our favorite videos of the year although we are a bit worried should Tesla start applying self-driving technology to inanimate objects. We do not trust Elon Musk. And when chairs become intelligent, all bets are off.  Nonetheless, though blues do indeed run the game, they cannot make anyone entirely sad when they know self-driving chairs exist in the world. See you next week with happier international news.

【TECH for LIFE】INTELLIGENT PARKING CHAIR | In…
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