Memia 2020.07: Lest we forget // Going coronaviral // After the event // Quantitative confusing // Doing capitalism differently // VR conferences

*Remain Indoors* (or Gwyneth gets gooped)

Hi / Kia ora

Ben Reid here with another issue of the Memia newsletter, my regular roundup of foresight, tech and - for some weeks to come I expect - tangential branches off Covid-19 😷 - all with a particular focus on my corner of the world, Aotearoa New Zealand. Please feel free to forward this email - and you can sign up here if you haven’t already.

A lot can happen in a week, eh?

After just a few days, we are now in the full-on grip of a national emergency public health response to a global pandemic. Right now the NZ government is looking pretty competent relative to some of our peers for acting swiftly, decisively and (zeitgeist word) kindly. Kudos and thank you to everyone involved in the response at every level. No place in the world I’d rather be right now.

[I’m just returned from a mad overnight dash from Ōtautahi to Ōtepoti and back, extracting Otago Uni students (eldest daughter amongst) just in time for the 4-week nationwide lockdown announced on Monday. (Big shout out to friends Edwin (founder of Dunedin electronics gurus Kamahi) and Ina (chief wrangler at NZIFF) for sheltering me, suitably distanced, at very short notice - 🙏folks.)]

The most clicked link in the last issue (~14% of openers) was Worldometer’s live Covid-19 coronavirus outbreak tracker. The numbers keep going up. As of the time of publishing:

Lest we forget

Firstly: 15th of March was one year on from the terrible Christchurch mosque shootings. In amongst the complete saturation of the current pandemic, we are still remembering all of those so tragically lost, including my friend and colleague Atta. At the Remembrance service a year ago Hollie Smith and Teeks gave the most beautiful and moving musical performance I’ve ever seen. Watch it again.

Going Coronaviral

Last week I wrote about the COVID-19 Information Avalanche. In hindsight, that was nothing. Coronavirus commentary has gone well and truly viral since.

To keep it brief, here are just a few more articles which I found helpful which you may well have seen already, but including in case not. Reminder: there is a lot of misinformation out there too.

After The Event

Timeless British Comedy duo Mitchell and Webb had a darkly funny sketch about a post-apocalyptic quiz show set some unspecified time after “The Event”: Remain Indoors.

Thankfully we’re not quite there yet - but several think pieces on what the post-Covid19 future might look like caught my eye in the last week:

“In this time of crisis, we face two particularly important choices. The first is between totalitarian surveillance and citizen empowerment. The second is between nationalist isolation and global solidarity.”

A few common themes coming at me from these articles:

  • The pandemic could cause a significant long term reduction in the global economy’s productive capacity

  • Global supply chains will reconfigure to optimise less for lowest cost and more for resilence - which likely means more re-shoring (see also interview with Cactus Outdoors’ Ben Kepes below)

  • Borders are now closed to people and international trade is diminishing rapidly. There are mixed views on whether global economic interconnectedness will retrench inside national borders completely or whether it will reconfigure towards a different, perhaps more China-centric international model. Either way, the waning of US economic dominance is anticipated to continue. (Indeed, it may be much sooner than anticipated that China’s GDP exceeds that of the US for the first time).

  • Government is back. Whether authoritarian or democratic, business can’t fix this public health emergency - and hence Governments are stepping in to take command of key power levers again after decades of laissez-faire, with general support from their populations. Will they want to hand them back? (Would we want them to?)

Quantitative confusing

This tweet is now 2 weeks old:

Since then, governments and central banks worldwide have been launching into action to inject cash (=debt) into their economies.

New Zealand has been particularly robust in its response:

  • The Government’s economic support package has grown to around NZ$16.1Bn so far. (Massive kudos to the team at MSD for rolling this out so fast - employer subsidies have been in bank accounts within 36 hours of applying in many cases. Clearly the result of long contingency planning and key learnings from the Christchurch earthquakes.)

  • The Reserve Bank reduced interest rates to a record low of 0.25% and announced quantitative easing (QE) by buying up to NZ$30Bn in government bonds

  • The Reserve Bank has also agreed a “mortgage holiday” repayment scheme with the main commercial banks. (Retail banks will still charge interest throughout is my understanding).

Reserve Bank Governor Adrian Orr went on RNZ’s Morning Report to explain QE and the other responses. Confidence inspiring, but how it all works is still too opaque for most of us. How does QE relate to (…the mass hallucination we all enjoy of seeing…) NZ$ sitting in our bank accounts or mortgages when we open our internet banking in a web browser? Request to Adrian (once you’ve finished saving the nation!): please can the Reserve Bank publish some explainers *in very simple terms* how NZ$30Bn can effectively be conjured out of the future for use now - and what the impacts for holders of NZ$ now and in the [aforementioned] future are.

Even the BNZ is confused:

[As an aside, somewhat unintuitively, non-inflationary Bitcoin has gone down in value in the current fiat QE environment. Perhaps this is why.]

Doing Capitalism Differently

Related…while these fiscal and monetary measures could help solve short term economic pressures - they surely perpetuate the financialisation of everything which has failed so starkly to optimise for long term environmental and social outcomes.

The Covid-19 crisis is a chance to do capitalism differently argues UK-based economist Mariana Mazzucato. Unlike the GFC of 2008, the aftermath of Covid-19 is an opportunity for governments and regulators to ensure that new systems and institutions come out of this - “Financialisation 2.0” say, which address climate change, inequality and wellbeing concerns directly:

"Conditions can be attached to make sure that bailouts are structured in ways that transform the sectors they’re saving so that they become part of a new economy – one that is focused on the green new deal strategy of lowering carbon emissions while also investing in workers, and making sure they can adapt to new technologies. It must be done now, while government has the upper hand.”

Time for policy circles to get thinking about this while working from home?

Also, for a completely contrarian - but compellingly cogent - argument against indefinite economic growth, Murray Grimwood writes in interest.co.nz: its time to abandon the ship of modern financial life and lower our expectations to a long-term, energy-sustainable lifestyle that doesn't plunder earth's resources. Rather presciently, a year ago he wrote this:

There is some urgency … the ‘sinking’ (most likely a global financial belief-loss event but maybe macro war and certainly a retreat behind borders reducing trade, with the background drumbeats of overpopulation, energy depletion, climate change, resource draw-down, sink-filling and entropy) is somewhere between tomorrow and 2030

According to Grimwood, sustainability boils down to EROEI - Energy Return on Energy Invested. (But fundamentally I disagree with him that the Earth need remain a bounded, finite energy system into the future - we have a yellow dwarf star less than 9 light minutes away which is there to be tapped at orders of magnitude more scale than we have so far…)

(Phew. Clearly had too much time on my hands / adrenaline flowing this week!)

Rollcall

Our tech sector, like the whole global economy, has largely gone into hibernation while preparing for lockdown this week. But I hear of a few bright stories from my network as anti-fragile business models start to thrive in the new reality. (The University of Auckland's Mike Lee asks What type of business will best survive Covid-19? Answer: Those delivering asynchronous, location-independent products and services. Sounds like most new generation tech companies to me...)

[Weak] Signal

Just one weak signal from the future this week:

Hidden Gems

Finally a few enjoyable topical links from around the internet:

  • Definitely worth (re-)watching 2011 film Contagion - an uncanny thought experiment of a virus pandemic which anticipates much of what we’re going through right now. Plus Gwyneth Paltrow gets gooped within the first 15 minutes.

  • A handy Toilet paper calculator to check how much toilet paper you need to survive the pandemic.

  • Stay at home and fight the V(i)R(us)! play Corona Samurai

  • And Where’s Waldo - Social Distancing Edition:

Image

As always 🙏 to everyone who sent in links and feedback - and since you managed to read all the way to the end, a reminder to please feel free to share with a friend somewhere around the 🌎 🌍 🌏. Thank you!

Our 4 week lockdown starts tonight. See you on the other side.

Remember:

Regards / Ngā mihi

Ben