Andy Kessler

WSJ: The High Cost of Losing Elections

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https://www.wsj.com/articles/the-high-cost-of-losing-elections-8eabce4a

After Donald Trump’s federal indictment, he was nice enough to email, “While today is certainly grim and dark, do NOT lose faith! Please make a contribution to peacefully stand with me today and prove that YOU will NEVER surrender our country to the radical Left. CONTRIBUTE $24,” with a link to WinRed.com. The caps give it a Nigerian-prince feel.

It reminded me of a note from a reader: “Donald Trump is in politics for only one reason: money. There is a reason he campaigned for the two GOP senate candidates in Georgia in the January 2021 runoff, when even the WSJ said he should have shut up—he wanted them to lose and the Dems in control so he could energize his base to contribute more. The scenario he wants is to get nominated again for 2024, get lots of contributions, then lose the election so he doesn’t have to deal with politics again.”

I suppose there is some truth to this—Mr. Trump did sell $5 million in Trump digital trading-card NFTs, after all. But purposely losing? Like Gollum from “The Lord of the Rings,” I think Mr. Trump tasted power and wants it back. And to be fair, Mr. Trump reportedly contributed $66 million of his own money in 2016, although the campaign spent $13 million at his businesses. Maybe he is trying to recoup the rest.

Who makes money in elections? I started turning over rocks to find out. There is certainly plenty of money. Some $14 billion was spent during the 2020 elections, almost $6 billion on the presidential race. Another $16 billion was spent on the 2022 midterms. That’s a lot of traditional media and digital advertising. Wanna bet it’s more than $25 billion for 2024?

Campaigns are lucrative. Barack Obama paid strategist David Axelrod’s firm more than $2 million from 2005 to 2008. Hillary Clinton’s campaign paid pollster Mark Penn’s firm more than $5 million when she lost the 2008 nomination. Nice work if you can get it. I wonder who she paid in 2016 to tell her not to bother visiting Wisconsin.

Campaigns consist of fundraising, operations and advertising.

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WSJ: How United Became an Airline

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https://www.wsj.com/articles/how-united-became-an-airline-flight-dress-code-first-class-jobs-boarding-crew-c9f74c37

“I was told you’d have a ticket to Chicago in my name,” I said to the woman working the United Airlines ticket counter. I was headed for an interview with United but was really going to visit my girlfriend (now wife). “Yes, here you go. First class.”

Another woman behind the counter looked over and, with a slightly disgusted look on her face, said, “Sir, I can’t let you travel in first class. We have a no-jeans policy.” Huh? It turns out this was still a thing in the 1980s. The first woman pointed to her screen, “Well, it does say VIP.” I couldn’t help smiling, mostly because I was being called “sir” and “VIP”—the first (and last) time that ever happened. With clenched teeth, they wished me a good flight.

Arriving at United in Elk Grove Village, Ill., not far from O’Hare International Airport, I was met by Norm Poole, who was in charge of the company’s technology. He started spouting statistics: “United has over 70,000 employees, 10,000 of them in the Chicago area. We’re its largest employer. Let me give you a tour before we sit down.”

We must have walked a quarter-mile talking about computers and networking—turns out they kept the tech types far away from everyone else. He asked about my time at Bell Labs. I said, “I prefer to use native Vax computers from Digital. Unix machines are always crashing.” Mr. Poole corrected me, “This is an airline. There is an unwritten rule to not use that word.” “OK, uh, Unix is prone to unscheduled service disruptions.” He smiled.

We kept cutting through rooms with giant tables covered in red-carbon-printed airline tickets, stacked in foot-high piles. Employees, almost exclusively women, were chatting away while flipping through them, making different stacks. I saw a dozen of these rooms, all loaded with tickets.

“It’s the dirty little secret of the airline business,” Mr. Poole explained. “We can get people on and off planes and fly them to where they need to go, but then we have to fly the damn tickets back here and sort them.”

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WSJ: A Tale of Two Economies

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https://www.wsj.com/articles/two-economies-unemployment-tech-layoffs-ai-gpus-nvidia-6df509ee

Did you see the latest jobs numbers? Employment increased 339,000 in May, according to the Bureau of Labor Statistics. Woo-hoo! But the same report showed that the number of unemployed persons increased by 440,000. Weird. Tech layoffs are continuing, but so are shortages of cashiers and cooks. Also, last week saw the largest money inflow into technology equity funds ever. The S&P 500 is up 12% for the year, but it’s down if you exclude seven top tech names. We’re living in a Dickensian tale of two economies—the best and worst of times.

The market is going sideways. We’re at one of those precarious Yogiesque forks in the road for the economy and market. We tread water, walk a tightrope. It’s both an “age of wisdom” and an “age of foolishness.” What will tip things up or down?

Here’s some nasty stuff: Now that the debt-ceiling arm-wrestling contest is over, Treasury needs to raise more than $1 trillion in auctions over the next few months. That is some overhang. Who is going to buy all that debt? Not the Federal Reserve, which is in quantitative-tightening mode. And remember, U.S. banks are $2.2 trillion underwater in their bond portfolios. As deposits move to higher-yielding money-market funds, banks are selling bonds as well. Plus, their commercial real-estate loans are a mess. Defaults are the highest they have been since the 2008-09 financial crisis as city office occupancy rates hover around 50%. No shortages there.

As opposed to eggs. This spring’s egg shortage caused prices to jump 60% year over year. Now guess what’s in short supply? Baby chicks. Note the eggs came first. Shortages began during the pandemic and kept rolling: dumbbells, toilet paper, baby formula, many generic drugs, lithium, nickel and now GPUs, graphic processors used for graphics, crypto and artificial-intelligence platforms like ChatGPT.

Nvidia stock popped 25% in May, reaching a $1 trillion market cap based on decent earnings and a shortage of their GPUs. That’s $200 billion in value created in a finger snap. AI is hot. It’s the next upside. Any company that so much as whispers “AI” has seen its stock skyrocket.

But beware—AI companies are the new meme stocks.

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WSJ: Can the Climate Heal Itself?

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https://www.wsj.com/articles/can-the-climate-heal-itself-cumulus-cirrus-clouds-negative-feedback-un-30bbbef0

Stop with all the existential crisis talk. President Biden said, “Climate change is literally an existential threat to our nation and to the world.” Defense Secretary Lloyd Austin also talks about the “existential threat” of climate change. National security adviser Jake Sullivan identifies an “accelerating climate crisis” as one reason for a “new consensus” for government picking winners and losers in the economy. Be wary of those touting consensus.

But what if the entire premise is wrong? What if the Earth is self-healing? Before you hurl the “climate denier” invective at me, let’s think this through. Earth has been around for 4.5 billion years—living organisms for 3.7 billion. Surely, an enlightened engineer might think, the planet’s creator built in a mechanism to regulate heat, or we wouldn’t still be here to worry about it.

The theory of climate change is that excess carbon dioxide and methane trap the sun’s radiation in the atmosphere, and these man-made greenhouse gases reflect more of that heat back to Earth, warming the planet. Pretty simple. Eventually, we reach a tipping point when positive feedback loops form—less ice to reflect sunlight, warm oceans that can no longer absorb carbon dioxide—and then we fry, existentially. So lose those gas stoves and carbon-spewing Suburbans.

But nothing is simple. What about negative feedback loops? Examples: human sweat and its cooling condensation or our irises dilating or constricting based on the amount of light coming in. Clouds, which can block the sun or trap its radiation, are rarely mentioned in climate talk.

Why? Because clouds are notoriously difficult to model in climate simulations. Steven Koonin, a New York University professor and author of “Unsettled,” tells me that today’s computing power can typically model the Earth’s atmosphere in grids 60 miles on a side. Pretty coarse. So, Mr. Koonin says, “the properties of clouds in climate models are often adjusted or ‘tuned’ to match observations.” Tuned!

Last month the coddling modelers at the United Nations’ World Meteorological Organization stated that “warming El Niño” and “human-induced climate change” mean there is a …

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