Macromegas #2

Hi friends,

Useful Knowledge

Post-COVID-19 stock market prices - Two non-standard hypotheses for current high stock market prices

New essay where I explore 2 non-standard hypotheses for current high stock market prices following COVID-19:
Hypothesis 1 - regular stock markets participants do not feel the crisis first-hand
Hypothesis 2 - the COVID-19 (pre-)crisis stock market correction attracted lots of first-time investors
Read the essay here (~3min): Post-COVID-19 stock market prices


Percentage of the population still susceptible to COVID-19 by end of June

Fernandez-Villaverde and Jones have revised their R0 estimates, and expand their thinking to herd immunity and progressive reopening. I visually represent below their predictions based on 2 different death rate estimates (the two columns are to be taken as a range). A lower percentage is "better" because it means that the population is less likely to face a future outbreak (even though it means the infection rate has been worse so far).

The full article is a great read if you have time: Estimating and Simulating a SIRD Model of COVID-19 for Many Countries, States, and Cities

People started selling equity in themselves via smart contracts (Ethereum)

Basically selling a share of your future earnings for life, pricing based on your potential for future earning.
I have been thinking about this idea from a theoretical point of view for quite some time. It seems to work from a pure cash-flow perspective, but it raises tricky legal/regulatory questions. For example, how does it work tax-wise? How do you account for the country where the person chooses to live and the consequential tax rate? What about non-financial benefits that cannot be priced in but are very real?

Practical example: you raise equity based on an expected career in San Fransisco, then relocate to Sweden where your income (especially net) becomes a fraction of the anticipated on. As the equity seller, your utility most likely does not decrease much, and might even increase considering Sweden's attractive social benefits. But as an investor, you are much worse off!

The exercise is (reasonably) standard if you are a corporation, but not so straightforward as an individual.

For reference (quite tedious do read), the "ICO" announcement: Initial $KERMAN Offering

Personal Growth

"The world rewards the people who are best at communicating ideas, not the people with the best ideas."
- @david_perell

"You do not rise to the level of your goals. You fall to the level of your systems."
- @JamesClear

This last quote is one of the aspects I will be tackling in the online course I will be releasing this summer, "Systematize Success".
If you are interested, simply hit reply and I'll add you to the waiting list (discount code when it launches).

Thanks for reading - talk to you next week,

V


PS: as usual, if you have questions, comments, suggestions, or ideas to explore, feel free to write: simply hit reply.