My latest appearance on "America Now with Andy Dean," this time to talk about yesterday's relatively positive economic news, which caused the Dow to rise almost 500 points. As always, a lot of fun to go back and forth with Andy and a good chance to summarize my DeBord Report post from Wednesday about the eurozone crisis, central banks, the impending jobs report, housing data, and whether China will be able to hold its own economy together.
I'm on at about the 31:00 mark. Enjoy!
I've been getting a fair number of comments on my Bitcoin post from a few days back, itself a response to Fred Wilson's Bitcoin post. Most think I'm completely wrong about Bitcoin and its future as a form of currency. Some commenters are particularly upset by my assertion that Bitcoin is illiquid — by which I mean its value isn't predictable enough for it to function as a ready medium of exchange (although it's not that simple because liquidity is a cryptic concept, used commonly in finance in a sort of metaphorical sense, but ill-defined and misunderstood, really reverse-engineered from its features, one of which is predictability of price).
Here's a sample, from MoonShadow:
The true irony of this article is that Bitcoin is nearly perfectly liquid, even though it's ultimately deflationary. I know what liquidity is, liquidity is the ability of economic actors to engage in exchange rapidly and with as few intervening steps as possible. This is why cash is very liquid and real estate is not. Bitcoin is very much like cash in this respect. Go try and tell Bitcoin users that Bitcoin is illiquid, and they will laugh at your ignorance. The only people for whom Bitcoin is not liquid are those who don't have any.
Venture Capital in Southern California panel. From right, KPCC's Matthew DeBord, Rustic Canyon Partners' Nate Redmond, Idealab's Alex Maleki, and Ben Kuo from socalTECH.
Last night, I sat down with Nate Redmond of Rustic Canyon Partners, Ben Kuo of socalTech, and Alex Maleki of Idealab's newly formed New Ventures Group to talk VC in SoCal.
We enjoyed a lively and informative 90 minutes of discussion at the Crawford Family Forum with plenty of good questions from the full-house audience (Thank you, KPCC community!)
I'm going to post some outtakes from the event, but one of things that struck me, for whatever reason, was a recent grad who asked the panel about how to break into venture capital as a career. This got my attention because VC is a relatively new option in professional finance (dating back to the late 1960s and early 1970s) and because, well...most young people seem to want to start companies, not fund them.
That said, in my experience VCs, at every level, are interesting people, glad to share their knowledge and committed to the idea of entrepreneurship, innovation, and a positive future. I wasn't surprised that Nate Redmond's advice was simple but insightly.
Tree down in Old Town Pasadena By Susan Long
I didn't wake up to carnage at my house this morning, but many other people in the Los Angeles region did — especially in Pasadena, which got hit hard by the Santa Ana wind event that's ongoing over the next few days. We've had gusts in the 80-90 mph range in the region's canyons, while in places like Pasadena, it blew 60 mph overnight.
This was enough to take out, evidently, hundreds if not thousands of trees. Tree limbs, too. And, of course, it's LA, so there are dead palm fronds all over the place.
My question is, with unemployment in excess of 12 percent regionally, is this not an opportunity to hire some unemployed people to cut back the "urban forest" to levels that won't create such a mess the next time we have a Santa Ana? And we will have another Santa Ana...
Pasadena actually has an Urban Forest Advisory Committee. I plan to check in with them to to find out what kind of money Pasadena spends on tree maintenance, and what it demands of homeowners with trees on their properties. I did spend a year recently learning a lot about forest management on a large scale (for bioenergy and real-estate investments), and the consensus is that a well-managed forest — meaning one that's logged and cleared frequently — is a healthy forest.
The California Community Foundation has released a new study, "The Future of Philanthropy in L.A.: A Wealth of Opportunity." My KPCC business vertical colleague Brian Watt will have a report on air later that you can listen to, and I'm going to provide a bit on insight in the overall trend of wealth formation and transfer in the LA area.
The numbers are far from trivial: "Despite the recession, Los Angeles County residents have an estimated net worth of almost $1.3 trillion." Just to put that in perspective, the entire annual GDP of the United States is about $14.5 trillion. What's truly staggering, however, is how much of this money will transferred generationally: the RUPRI Center estimates $1.4 trillion by 2060 — a huge increase over 2020's projected $114 billion.
What's truly fascinating about these numbers is where the wealth is coming from. According to the report, "LA's growing and future wealth will be driven by entrepreneurs, especially immigrant entrepreneurs."