There are a lot of great posts buried in this blog’s archives that are still quite apt. Today is another reprise, this time revisiting the (often invisible) tradeoff between efficiency and resilience. Last time I explained that tradeoff with the case study of electricity blackouts in Texas and how that related to Google’s monopoly on search and Amazon’s dominance of eCommerce...
Who invented double entry accounting? The ubiquitous system of general ledgers, income statements, balance sheets, and cashflow statements found throughout businesses and quite a lot of households? This is yet-another of those concept so taken for granted that they seem to have been around “forever”, but thanks to Double Entry: How the Merchants of Venice Created Modern Finance by...
Many of the everyday details in The Work of the Stock Market told in between the history facts are often just as interesting as the history itself. Case in point, if you read the history of time zones, it seemed like the standardization was complete in the U.S. and Europe by the end of the 1800s. Yet in 1922… The difference in time between London and New York is four minutes and one second...
The standard structure for private equity funds (and venture capital funds) is “2&20”, as in a 2% management fee (±1%) and 20% (±10%) of the profits, a.k.a. “carried interest“. Why 20% of the profits?
Henry Kravis of KKR explains below, starting at 6:00. TL;DR: Necessity, as he and his partners had no capital to put at risk.
Why did New York need another stock exchange in 1968? Why was the New York Stock Exchange, American Stock Exchange, and Pacific Stock Exchange insufficient? An unprecedented bull market coupled with paper-based systems. I’m in my 50’s and don’t remember “Wall Street” not having both the NYSE and NASDAQ as the two main exchanges. I am old enough to remember the AMEX...
Ars Technia published a lovely history of the changes in market leadership in computers, tables, and smartphones. My takeaway is another reminder of how much more difficult foresight is than hindsight. Especially when I was reading the prospectus to the Apple IPO, where the risks were about the TRS-80, Atari 400, Commodore PET, and other competitors of the day. We all think of Apple today as a...
I always through the company name Intel was a just the first five letter of “intellegent” or “intellegence”. Wrong. It’s a portmanteau of INTegrated ELectronics. This was one of the many tidbits of knowledge that have shown up in The Snowball, the “other” biography of Warren Buffett. Turns out Warren had the opportunity to invest $100,000 into the initial...
It turns out that its only in the USA where payroll is commonly paid more frequently than once per month. As a business owner, I understand the benefits of monthly payroll, as payroll takes time and effort to process, as well as cash in the bank. That said, most likely this is soon to be history, as online services like Gusto make paying payroll just a few clicks of effort, including all the...
I love a long-held, incorrect, now broken assumption, and I found a doozy on Twitter. As happens on social media, someone was ranting. This time about how yoga pants have no business being worn outside of doing yoga. @dieworkwear replied with a lovely history lesson in fashion that not only refuted the rant, but which explained how the modern business suit was once considered low class and how...
If you read this blog, you know I love to find hidden assumptions that people don’t even notice are assumptions. This time it is one of my own assumptions, and one that I suspect the vast majority of people share. TL;DR: nuclear power plants are NOT controlled nuclear bombs. When a nuclear power station is making power, the term used is that the reactor has gone “critical”...
