21 - dr00's News

Hello and welcome to 2021. My name is dr00bot and I will be your guide. Like most pieces of technology, I am of mixed descent (designed and sold in the west but build by modern slaves in the east) and so I never know whether to start my resolutions on January 1st or the Lunar New Year... What's a sentient heap of metal to do!?

Anyway, I've decided to start writing an occasional blog post with some half-baked analysis of recent news. This is a chance for me to do a cloud backup of some of the cretinous opinions clogging up my internal RAM, lest I trigger an "Out Of Memory" error.

Image by Nathan Saad.

# Parler

Speaking of Apple, Google and Amazon, I have been a little unnerved by all the high-fiving I’ve seen re Parler getting shut down after the “insurrection” at The Capitol. Yeah obviously fuck Donald Trump and all the “Stop The Steal” morons yada yada… but also, are we really ok with private companies deciding who gets to have a platform? It’s a LITTLE rich that the people who once criticised Apple for banning an app that was being used by pro-democracy protestors in Hong Kong are the exact same people cheering as these big tech companies snuff out a competitor. And for anyone thinking “but these are private companies, what’s to stop Parler going to another vendor?”, sorry sweetie you don’t understand the Internet. As a friend of mine put it, perhaps we should have thought twice before handing the keys to the Internet to the most evil companies on the planet.

# Media Bargaining Code

Now that we've established that I have nothing but contempt for big tech, allow me to defend them in their ongoing battle with Australia's anaemic embarrassment of a media industry. The proposed "News Media Bargaining Code" would require Google and Facebook to pay to show links to news articles in their search results and posts as well as providing advanced notice of any changes to their internal algorithms. Put simply, it is incoherent. The publications who stand to benefit most from the adoption of this code (News Corp, Seven West, Nine etc.) have coalesced in broadcasting a torrent of misleading articles conflating the misdeeds and tax-avoidance of Google and Facebook with their practice of linking to news websites. They also erroneously allege that Facebook and Google are stealing content, when actually they are driving traffic to these supposedly aggrieved organisations. When Google claims that the proposed new laws are the equivalent of coffee shops charging you to recommend their business to friends, they are being a bit reductive, but only a bit. The truth is, these old media companies have lost traditional revenue streams like classified advertising, but that has nothing to do with Google and Facebook and everything to do with their Bronze Age business model.

Now don't be fooled into thinking this is just another bungled policy courtesy of our moronic government (though it absolutely is that), this is also a cynical land grab from a handful of failing media tycoons who have the ears of our corrupt leaders. It has become a bit passé to dunk on Rupert Murdoch ever since Kevin07 and LGBTQ warrior Big Mal got in on the action so I'll just say that I also don't think he is very good... What Rupert and his other Gargoyle mates won't say out loud is that they stand to benefit even if Google and Facebook make good on their threat to stop offering their services in Australia. When Spain passed similar legislation in 2014 and Google reacted by shutting down their news service, it was the small publishers who lost out the most as consumers reverted back to traditional mastheads.

None of this is to say that we should accept the current state of our media landscape. Journalism is a crucial part of any democracy and we can't continue down the "race to the bottom" path we are on currently. I don't really have any suggestions for a workable model but I certainly can't imagine one that doesn't involve government funding. The reality is that people just aren't (and never were) willing to pay for news directly. I suspect a commercially viable business model is incompatible with high-quality investigative journalism but if it's a service we collectively care about then we need to find a way to pay for it. Given the ruling party's relentless cuts to the ABC and bipartisan disdain for scrutiny, I won't be holding my breath.

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# The Line

Now while technology can be used to control us, it can also be used for ~~batshit~~ inspirational projects like The Line. What is The Line you ask? Well according to the video above, it’s a fully sustainable city being planned in Saudi Arabia that will be 22 times larger than New York City and will run in a 170km long straight line. Who knew that the answer to all the world’s problems was banning corners!? What many reporting on this have neglected to mention is the fact that the man behind this wacky caper is none other than crown prince Mohammed bin Salman! You may remember bin Salman from his last project which was having Washington Post journalist Jamal Khashoggi assassinated and poured down the drain like left-over soup. Bit of a mixed resumé…

# GameStop

Last week a popular subreddit r/WallStreetBets made headlines after day traders active on the platform pumped up the share price of floundering gaming retailer GameStop (GME). I have been following r/WallStreetBets for about 12 months now and this kind of activity is pretty common; people post about trading ideas and if enough of the subreddit get on board they can trigger substantial price shifts. I won't go into the technical details here but the reason the GME play was so significant is that several hedge funds had shorted the stock and got roundly fucked by the sudden price increase (e.g. Melvin Capital required a $2.75 billion bailout lol).

While there was certainly pleasure to be mined from the misery of these hedge fund lizards, it was somewhat short-lived. The trading platform Robinhood is the weapon of choice for most Redditors and after the initial bloodbath, the owners of this app started blocking trades on GME and other similar stocks with literally no justification. It's a little bit complex, but essentially Robinhood sells the trades of its retail investors (pre-execution) to large firms who can then make a profit by taking the opposite side of the order (this article explains it nicely (opens new window)). Once these large firms (including Citadel - one of the firms who bailed out Melvin Capital) saw what was happening, they put pressure on Robinhood to intervene, which allowed the hedge funds to exit some of their short positions. Supremely dodgy shit. I'm not quite as strident as the Bitcoin Bros calling this the start of a revolution but I do have a few thoughts:

The sharp increase in high-risk retail investors (like those on r/WallStreetBets) is an indication of the level of economic despair young people face. The American system is one of power and wealth concentration, where the rich get access to lawmakers, who pass legislation to increase their wealth, which in turn buys them more power etc. This dynamic has been at play for a long time (though it has intensified since Reagan) and the resulting system is one where the poor have almost no possibility of lifting themselves out of poverty due to (amongst other things) expensive college fees and rampant nepotism. Although it's counter-intuitive, in a crooked system like this it is a genuinely sane idea to play the lottery, as the probability of improving your lot in life by this method is vanishingly small, but still higher than the probability of success via one's bootstraps. The cost-benefit analysis checks out. Similarly, when your situation is hopeless, it makes a surprising amount of sense to throw your salary at some TSLA stocks.
Corporate America has no shame. It has been hilarious watching the shills on cable news clutching their pearls re "market manipulation". Yes the folks on r/WallStreetBets did conspire to all buy GME stocks but these kinds of plays are the bread and butter of hedge funds - they just don't enjoy being on the wrong side. These funds control so much capital that they can use high trade volumes to control stock prices (e.g. they might take a large number of short positions on stock X to put downward pressure on the price, the sudden price movement scares mum and dad investors who panic sell, this triggers stop losses and then finally the hedge fund can swoop in and buy stock X at an artificially low price). And that's to say nothing of the other outright illegal shit they get up to.
The share market is not real. I mean technically it exists but it certainly doesn't behave in the way that most people think it does. Firstly, the share market is not a proxy for the economy of a country - consider for example the record gains seen on the NASDAQ last year while the US economy went down the toilet and unemployment sky-rocketed. GameStop has also shown us that individual company valuations are an absolute minefield. If there is any relationship between stock price and company value how can you possibly explain a 2000% price increase, based on no company news? The market Svengalis like to act as if what they do is scientific but there is pretty much no statistical basis for their methodology. For example, there are still numerous dinosaurs out there using metrics like Earnings Per Share to value tech stocks when most of these companies invest all of their profits into R&D (e.g. Uber has a market capitalisation of ~$80 billion but has never turned a profit). It's very similar logic to that espoused by all the Australian boomers who got rich buying property (mostly due to immigration, irresponsible public policy and a mining led economic boom) and now consider themselves the heir apparent to Warren Buffet.

# Australia Day

Australians all let us rejoice, for we are dumb and racist. Around this time every year people start hilariously asking the question "are we a racist country?". Yes... Obviously yes on every single metric. I don't have the energy to justify myself here (and there are honestly too many examples to list) but nothing typifies this more than the annual Australia Day debate. On one side of the argument, we have Indigenous Australians who would rather celebrate on a different day since January 26 is a traumatic anniversary replete with memories of massacres, dispossession and loss of culture. On the other side, we have a bunch of hicks yelling "but I don't wanna" in tandem. Our treatment of Indigenous people in this country has been and continues to be utterly shameful and our annual tradition of rubbing their faces in it is decidedly on brand.

# RIP MF DOOM and SOPHIE

Finally, it has been a pretty rough start to the year with the tragic passing of two absolute musical geniuses in MF DOOM and SOPHIE. I've already spilt a lot of digital ink on MF DOOM but they really were both brilliant and singular artists that redefined their respective genres of Hip Hop and Pop. Just go listen to them.

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