Outrun Change

We need to learn quickly to keep up with the massive change around us so we don't get run over. We need to outrun change.

A: 48% & 0%. Q: Percent of individual income taxes paid by top 1% of taxpayers and bottom half (projected for 2015)

Table 4 of the Fairness and Tax Policy document from the Joint Committee on Taxation contains projections from the committee for 2015 tax returns. The table projects income and taxes paid by income level.

All of the following income numbers are based on a fairly broad definition of income, starting with AGI and adding items such as employer social security taxes, employer payments for health insurance, workers comp payments, and nontaxable social security benefits.

Key items that jump out at me:

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Some days the world goes extra bizarre just to keep me laughing

Yesterday was one of those days the internet went out of its way to keep me laughing at the world’s silliness. Might just be my sense of humor.  Or maybe not, so follow along if you wish to see if you can find a few smiles and laughs. Perhaps it is just that I’ve been following the strangling impact of heavy-handed regulation of new industries that these stories are so funny.

Three discussions:  Stoner rabbits, marijuana industry as a service niche for CPAs, and Jr Deputy Accountant is back.

Stoner rabbits

The Utah legislators should vote down the medical marijuana proposal because a lot of bunny rabbits and other cuddly little critters will get stoned.

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Primer on Bitcoins and Cryptocurrencies

The Wall Street Journal features a brief debate today asking Do Cryptocurrencies Such as Bitcoin Have a Future?

If you haven’t thought about the idea of Bitcoins much and don’t know what cryptocurrencies are, the Yes and No positions will provide a lot of brain expanding ideas. If you have pondered the issue enough to sorta’ kinda’ have an answer to the question, you may still find the article to be worth a read. If you already have a position, check out the arguments from the other side.

 

Full length book coverage of the systemic academic fraud in athletic programs at UNC-Chapel Hill

I discussed the systematic fraud in the UNC academic and athletic programs in my previous post last October: Two humongous explosions in open frontiers I’m watching – space and education

The short version of the scandal: one department at UNC-Chapel Hill offered paper classes to around 3,100 students over 18 years. A new book points out the courses lifted many students GPAs above the NCAA minimum requirement. One student even made Dean’s list in a semester when he says he did no academic work.

The department running the scheme used codes from three different areas to prevent students from appearing to accumulate too many hours in one department, which would have run afoul of academic rules. To lift students GPAs would need multiple classes for each student. I’ve not seen guesses on how many courses were faked. Do you suppose it was 5 per student? 8? In other words, perhaps 15,000 or 24,000 fake grades.

A new book, Cheated By Jay M. Smith and Mary Willingham goes in to far more detail than the three previous investigations.

The book is reviewed at The Wall Street Journal: Dark Days in Chapel Hill / If you ran a college and knew there was substantial money to be had from sports but no requirement to educate athletes, you might cut corners—that’s exactly what the University of North Carolina did for nearly two decades.

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Why I chose a gun. Evil exists.

General Peter van Uhm is the Netherlands chief of defense. In the following TED presentation, he explains why he chose a gun to make the world a better place. Others choose a pen or brush.

He intentionally picked up a gun.

I’ve not talked about my military service on my blogs. His presentation is a superb proxy for why I took my turn carrying a gun, especially one that held frightening power.

Here’s the reason in one phrase: Read more…

More good stuff on the open frontier of energy – 2/25

New frontiers are rough and tumble places. The energy revolution is proving to be no exception.

A few recent articles about crude oil and natural gas which I found interesting:

2/19 – Nature – Study finds relatively low emissions of methane from major US gas fields / After a series of alarming reports, scientists estimate leak rate of about 1% for three major US gas formations – Study by team from University of Colorado Boulder estimates that methane emissions in three major gas fields, (Haynesville, Fayetteville, and Marcellus) averages about 1% of gas that is produced. Range is from 0.18%-0.41% in Marcellus to 2.1% in Haynesville and 2.8% in Fayetteville. Average of 1% is in line with industry and EPA estimates and dramatically less than the 1.5% many critics claim.

2/9 – Wall Street Journal – Oil-Price rebound PredictedRead more…

Has the U.S. just stopped making stuff? Yeah, I’d think so too if industrial output in the U.S. wasn’t at all time record high.

There’s an idea that we don’t make anything in the U.S. anymore. Well, we do import a huge portion of the good stuff we enjoy everyday. Yet we still make a huge amount of stuff here.

Check out this indicator of total industry production in the US. The peak production level is today:

industrial production 2-15

This is from the St. Louis Federal Reserve, which has a humongous database called the Federal Reserve Economic Data, or FRED.

What does the index above cover? From the FRED site:

The Industrial Production Index (INDPRO) is an economic indicator that measures real output for all facilities located in the United States manufacturing, mining, and electric, and gas utilities (excluding those in U.S. territories).(1)

So industrial production in the U.S. is at a record level. Cool.

Want to check out manufacturing only? Okay, here is it: Read more…

More good stuff on the open frontiers – 2/25

A few articles on technology, energy, and publishing that are worth a read and a brief comment.

Publishing

2/10 – Megan McArdle at Bloomberg View – You Want Advice? Don’t Ask Journalists - Journalism as a career path is going through savage turmoil. Want to write in-depth about an industry or topic? She suggests going to work in that industry and find some writing do to there. Then you can go back to journalism if a great opportunity surfaces or your new industry collapses.

Education

2/11 – Chronicle of Higher Education – Meet the New, Self-Appointed MOOC Accreditors:  Google and Instagram

Read more…

Transportation costs dropped 95% in the 1800s

There are a lot of data points on travel cost and travel time during the first half of the 1800s mentioned by Allen Guelzo in his fantastic book, Abraham Lincoln: Redeemer President.

Here is the most amazing part:

Overall drop in cost to transport freight with canals, steamboats, and railroads (location 641):

  • 95%

I want to accumulate some of these tidbits since I’m amazed at the radical change created by technology.

Transportation time and cost

Consider:

Travel by stagecoach: Read more…

More indications of the battle between free enterprise and regulation in Washington’s recreational marijuana market

A reader pointed me toward this report from CNBC: Washington has more pot than it can smoke.

Feels like I hit a jackpot in watching the battle between free enterprise and crushing regulation. Follow along with me as I highlight the story with editorial comments on capitalism and regulation.

You may want to get a fresh cup of coffee. This will be along article.

Why so much discussion?

Why am I spending so much time writing about medical marijuana? As a general matter I don’t give a hoot about this marketplace because I have zero interest in this or any other market for intoxicants.

The medical marijuana markets are a natural experiment in a small, separately visible, newly created market and the impact regulation has on the development of that sort-of-legal industry.

Opportunities to see whether regulations strangle an industry are so limited everywhere else in the economy because other markets are large, well-developed, complex, intertwined, and have already adjusted to regulation.

With medical marijuana we can watch a brand-new industry adjust to brand-new regulations.

Back to the article.

There is apparently a huge excess supply of recreational marijuana over demand in Washington State.

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Some data points on pricing in newly legal recreational marijuana. We can already see distortions created by regulation.

Comments by a reader of my blog informed me that wholesale prices of state-legal-federally-illegal recreational marijuana have dropped dramatically. That got me to wondering what has happened to the pricing.

I’m am otherwise totally clueless of the pricing in this market. What I know I learn by reading the ‘net.

Just so everyone knows, I am following this story because it is a natural experiment to see the impact of crushing regulation imposed on a newly emerging industry.

The commenter shared a recent report on CNBC quoting a producer saying the wholesale prices had dropped from $1,700 to $2,200 per ounce down to $700 per ounce.

The range in price is due to different qualities. That would give wholesale prices in the range of $60 to $77 per gram in the recent past to around $25/gram currently.

That gives these data points:

  • Wholesale
  • $1,700 to $2,200 per ounce sometime prior to the CNBC article
  • $700 per ounce at the time of the CNBC article (date unknown)

So using the ‘net, which is the most incredible educational tool ever invented, I search for about 10 minutes and found a lot of great info. Spent another 10 minutes reading promising articles and found the following:

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Mr. “Worlds far away”, please let me introduce Mr. “Natural experiment in heavy-handed regulation”.

I have multiple interests on this blog. As is extremely obvious, I have been captivated by the energy revolution created by horizontal drilling and hydraulic fracturing. Have also been fascinated by the wide open frontiers of education, publishing, private space exploration, energy, and technology in general.

There are at least two other threads. First, dark worlds far away  I’ll never visit, such as selling drugs and sundry other illegal stuff on the net (called “dark nets”). Another thread is the watching how much heavy-handed regulation is dragging down the newly legal industry of recreational marijuana.

Just like the closing scenes of Ghostbusters, those two threads have touched each other and merged.

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Update on marijuana regulation – #15

Only a few articles I’ve noticed recently on the state legal sales of recreational marijuana. In case you are just noticing my articles on the topic, my interest is to watch the natural experiment of whether overbearing, heavy-handed regulations strangle a brand new industry.

1/15 – KOMO news – Too much pot: Growers struggle with glut of legal weed This is essentially a story on implementation issues in Washington state. Initially there was a shortage of state-legal marijuana, now there is a glut. Since last summer, growers have harvested 31,000 pounds (I have no idea how that count is determined).

Article says many users are staying with the lower taxed medical marijuana.

Read more…

More good stuff on the open frontier of technology – 2/18

A few articles on the amazing things going on the in wide open tech frontier. Video of building an airplane. Potential for blockchain (which is the tech behind Bitcoin), we are all moving toward being entrepreneurs, and FAA’s draft rules on drone use.

1/7 – BBC – The world’s biggest ship – for 53 daysThe Globe can carry 19,100 of the standard 20 foot containers. That’s equal to 4,550 of the usual container you see pulled on a big rig on the freeway. It is the largest cargo ship on the sea. It weighs in at 186,000 gross tons.

It only takes a crew of 23 to operate this ship, which shows how automated it is. The engine is so efficient that this ship uses 20% less fuel per container than a ship that can hold 10,000 TEU (I think that is the abbreviation).

Boeing – Time lapse video of airplane construction - hattip BehindTheBlack blog.

1/22 – TechVibes – How Technology Behind Bitcoin Could Transform Accounting As We Know ItGreat article providing background on blockchain, which is the core technology behind Bitcoin. Good brain stretcher on where blockchain could go.

Read more…

More good stuff on Bakken – 2/17

Here’s a few more articles on Bakken I found interesting – adjusting to growth and drop in crude oil prices. How would you handle calls for police service increasing by a factor of 180 over the last 8 years?

1/9 – Oil Patch Dispatch – Record number of births reported in Oil Patch in 2014 – Along with the huge number of workers moving to North Dakota, there is another year of record baby births.  Main hospitals in Minot, Williston, and Dickinson report increases of 5%, 7%, and 13% respectively.

Read more…

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