SoftBank & Lehmans

Following on from my previous post about the age of loose money comes this article from Capitalist Exploits with some of the same concerns, namely that we’re partying like it’s 1999 again.

There are only two ways VC can get liquid: a buyout or an IPO.

And given that so many of the famous “unicorns” are valued at multiples that make my eyes shoot blood, there are now an ever decreasing number of companies that make suitable suitors.

So we’re down to flogging this stinking pile to the folks who always get roasted, especially at the tail end of a boom: retail investors… which is why we’re seeing tech unicorns IPO-ing.

This is a good strategy for VC, so long as those retail investors buy what is being sold.

The trouble now is that there are early signs that the appetite for these “growth” stocks is collapsing like a teenager after a bottle of Absolut on spring break.

The Instagramization of Finance

Interesting article at The Reformed Broker looking at the current state of finance markets where money is essentially free and a company’s style is more important than its substance - image is valued more than assets.

There are no asset managers who represent their strategy to clients as “We buy the most expensive assets, and add to them as they rise in price and valuation.” That’s unfortunate, because this is the only strategy that could have possibly enabled an asset manager to outperform in the modern era. It’s one of those things you could never advertise, but had you done it, you’d have beaten everyone over the ten-year period since the market’s generational low.

But almost every investment professional says that they do the opposite of this. Even the explicitly growth-oriented managers use terms like “at a reasonable price,” to communicate their place on the spectrum of speculative chastity. There are no textbooks lauding an investment approach where it makes more sense to buy PayPal at 4 times book on its way to 9 times book while forsaking Goldman Sachs at less than 1 times book.

Some of this is no doubt down to network effects - AirBNB’s product can be rolled out in a new market for a negligible cost compared to a major hotel chain moving in to a new territory - but you still wonder if this is some sort of repeat of the Dot Com boom where most tech companies were massively overvalued based on hype.

I’ve had a similar discussion with a friend of mine regarding buying property. We both took the rational approach of not buying for a long time as the market was severely overpriced, and, in my case, when I did buy I bought something I could afford to repay even if rates went up a few percent. In this age of free money, that was completely the wrong strategy. The correct one was to borrow as much money as the bank would give me, get an interest only mortgage to lower repayments and just get rich off the capital appreciation without repaying any of the principal. Is this a temporary aberration, or the new normal?

Metabolic Test

I went and had a Metabolic Test yesterday. A what, you ask? A metabolic test - you get on a stationary bike, they hook you up to a metabolic cart which measures the volumes of oxygen and carbon dioxide you inhale and exhale. You start cycling at a very easy rate, and every few minutes the rate increases until you’re too exhausted to cycle anymore. The data from the metabolic cart allows you to determine how much of your energy expenditure is coming from fat (FAT) and how much is coming from carbs (CHO) and how that changes as your effort increases.

Why Do This?

Well, it all started last year when I had finished a pretty consistent year of training and I looked back at my cumulative training data. I’d ridden a touch over 11,000km and burned about 270,000kcal but I hadn’t lost any weight. Sure, I have a sweet tooth and eat too much jellies etc. but overall my diet is pretty decent - bugger all processed food, cook most meals etc. etc. so I thought I’d have dropped a few kilos at least.

I’d read a little about metabolic tests over the years and decided I’d like to try one out, but the only place I could find that was offering them to the public was Jupiter Health on the Gold Coast, which isn’t convenient from Sydney. However, since we were moving to Brisbane in May 2018, I booked an appointment for late May last year. I did the test and it showed I was a really bad sugar burner, i.e: I was getting most of my energy from CHO on the bike and hardly burning any fat. This seemed to explain why I wasn’t losing weight - after all, if you’re not burning off your fat stores while exercising, when are you going to burn them off?

I haven’t done much training over the year since, but I have been reading about how to improve your fat burning. Alan Couzen, an exercise physiologist and coach has some informative articles, particularly How to turn yourself into a Fat-Burner, and while reading that I came across his articles on how you go about getting your fat burning tested, i.e: how to do a proper metabolic test, particularly Getting your ‘fat burning’ tested Part 1: Equipment and protocol.

Reading that confirmed some suspicions I had about the test I’d had done on the Gold Coast and the data I’d obtained from it. The two major concerns I had was that the basal rate data, obtained when you’re lying on a bed doing nothing for 15mins, showed me with a heart rate around 90-100bpm, which is about twice what I’d expect in that scenario. There was also a bit more fluctuation in the power data at each level and the time at each level didn’t seem to be consistent. I followed Alan’s suggestion to check with my local University’s Exercise Physiology department to see if I could do a test with them.

Luckily for me, I have Uni of Queensland (UQ) and Queensland Uni of Technology (QUT) to choose from, and, as it happened, QUT have their E3 Lab a 20min drive away, so I emailed them with my requirements and they were able to help.

The Protocol

Alan’s site provides a calculator where you can enter your estimated FTP and it pumps out your suggested starting level and how much the power output should be increased per level. It recommended that I start at 130W, but since the data from the previous test showed I was already starting to burn significant amounts of carbs at that level, I chose to start at 100W instead.

  • Each level lasts 5mins.
  • Start at 100W, then add 25W per level.

The guys doing the testing told me to tell them when I knew I would not be able to complete the next 5min level and we’d stop the test.

The Test

The test itself isn’t too exciting. As described, you start pedalling at an easy pace and it just keeps getting harder. The first 20 minutes are a bit boring as the work load is quite low and I was just trying to maintain a smooth pedal stroke and consistent breathing, i.e: instead of shallow breathing at low workloads, to try consistent deeper breaths throughout the test.

Wearing the mask take a bit of getting used to - at the start of the test you feel a bit weird as you’re not really breathing very often so it feels like the mask is keeping your mouth shut. Your heart rate is probably a few beats higher as a result too. As you start working harder and breathing more it becomes a non-issue.

The tightness of the straps keeping the mask on my face meant it was tricky to find a comfortable head position. Maintaining a normal riding position as if I was out on the road meant they were digging into the back of my head, so looking down at the bottom bracket seems to work best. I was getting a bit of a headache towards the end of the test too, most likely due to the straps’ tightness. However, tight straps equals tight mask seal equals accurate data!


Here’s the basic fuel substrate use graph, with power output on the X-axis and kcal/min on the Y-axis.

Fuel Substrate Use Graph

So, when I’m exercising at 100W (v. easy) I’m getting a bit over 7kcal/min from FAT and almost nothing from CHO, and by the time I fell apart at 275W I was getting a bit under 6kcal/min from FAT but 15kcal/min from CHO.

Peak volume of oxygen consumed (not shown on graph) was 4.85L, giving me a VO2Max of 52.8ml/kg at 92kg, which just scrapes into the 95th percentile for my age, so happy enough with that. I can bump it a few points more by dropping a few kilos, plus the test protocol I used wasn’t ideal for finding a true max, so there may be room for improvement there too.

It turns out that I’m actually a good fat burner, which is the complete opposite of the earlier test. The most likely explanation for this about-face is that there was not a good seal around my nose and mouth when doing the first test, so the machine wasn’t only measuring the air I was inhaling and exhaling. That could skew the results significantly. It’s also the case that the equipment available in the Uni lab was much more professional than that in use the first time around, so accuracy was a lot better.

Normally these tests run until you start going anaerobic, at which point you are burning zero fat. However, I never got to that point, still burning a decent amount of fat at the last stage of 275W. I’ll need to read up on that, but I suspect it’s just an endurance issue - I’m just not fit enough to get to pure CHO burning given the 5min/level protocol. I’d definitely get there with shorter levels, and would probably have gotten there if I’d started at Alan’s suggested 130W.

Moral of the story: instead of going to the local physio/fitness place, take the advice in Alan’s article and see if your local Uni will run an experiment on you.

The downside is that I now have no excuse for being over 85kg, so I’ll just have to knuckle down to consistent riding and improve my diet quality as well. No shortcuts 🤣

Privacy in the Information Age

Idle Words has a good article on [The New Wilderness](} on the nature of privacy in the Information Age. What does it mean when your every move is tracked and recorded online, and increasingly offline as well?

Until recently, ambient privacy was a simple fact of life. Recording something for posterity required making special arrangements, and most of our shared experience of the past was filtered through the attenuating haze of human memory. Even police states like East Germany, where one in seven citizens was an informer, were not able to keep tabs on their entire population. Today computers have given us that power. Authoritarian states like China and Saudi Arabia are using this newfound capacity as a tool of social control. Here in the United States, we’re using it to show ads. But the infrastructure of total surveillance is everywhere the same, and everywhere being deployed at scale.

The author discusses the similarity with the growth of environmental regulation as mankind changed from a being part of Nature to being a threat instead and suggests that we need to start thinking of global regulations around what is and is not acceptable when it comes to mass surveillance.

We’re at the point where we need a similar shift in perspective in our privacy law. The infrastructure of mass surveillance is too complex, and the tech oligopoly too powerful, to make it meaningful to talk about individual consent. Even experts don’t have a full picture of the surveillance economy, in part because its beneficiaries are so secretive, and in part because the whole system is in flux. Telling people that they own their data, and should decide what to do with it, is just another way of disempowering them.

Our discourse around privacy needs to expand to address foundational questions about the role of automation: To what extent is living in a surveillance-saturated world compatible with pluralism and democracy? What are the consequences of raising a generation of children whose every action feeds into a corporate database? What does it mean to be manipulated from an early age by machine learning algorithms that adaptively learn to shape our behavior?

Moon Rockets

Interesting facts on the Saturn V rockets, from Wired’s Beauty and Madness of Sending a Man to the Moon

The fires on which it rose were not the fire that leaps or licks or plays, the fire of brasier or boiler. They were the focused fire of the metalworker’s torch, given life at a scale to cut worlds apart or weld them together. The temperature in the chambers was over 3,000°C (more than 5,000°F). The pressure was over 60 atmospheres. And still the pumps, their turbines spinning 90 times a second, were powerful enough to cram more and more oxygen and fuel into the inferno. The flames slammed into the fire pits below at six times the speed of sound. For a couple of minutes, the five F-1s generated almost 60 gigawatts of power. That is equivalent to the typical output of all Britain’s electric-power plants put together.

Looking at the generation statistics from Australia’s National Energy Market, our generation capacity in 2019 is only 46GW.

Part of making lunar-orbit rendezvous work was making the spacecraft that actually went down to the moon, the LM, as light as possible. In the original specification it was to weigh just 10 tonnes (11 tons). During development, it put on weight, despite furious attempts first to arrest and then to reverse the process. But it remained pretty tiny. And thanks to the need to carry fuel, oxidizer, life support, batteries, computers and more besides, the LM was noticeably smaller on the inside than the outside. The two astronauts had 4.7m3 (about 165 cubic feet) of pressurized volume between them. That is roughly twice the volume of one of London’s red telephone boxes.

Just goes to show how much energy is required to put such a small volume on the Moon, assuming of course that you want it to come back 🙂