Each Sunday I compose a list containing the most thought-provoking and interesting content I’ve consumed during the past week. Primarily as a way to keep inventory of material that influenced me and my way of thinking.
Writings/Essays
Proust by Samuel Beckett.
Voluntary memory (Proust repeats it ad nauseam) is of no value as an instrument of evocation, and provides an image as far removed from the real as the myth of our imagination or the caricature furnished by direct perception. There is only one real impression and one adequate mode of evocation. Over neither have we the least control.
In fact, if Habit is the Goddess och Dulness, voluntary memory is Shadwell, and of Irish extraction. Involuntary memory is explosive, ‘an immediate, total and delicious deflagration.’ It restores, not merely the past object, but the Lazarus that it charmed or tortured, not merely Lazarus and the object, but more because less, more because it abstracts the useful, the opportune, the accidental, because in its flame it has consumed Habit and all its works, and in its brightness revealed what the mock reality of experience never can and never will reveal – the real. But involuntary memory is an unruly magician and will not be importuned. It chooses its own time and place for the performance of its miracle.
The Motion Picture Cameraman by Gregg Toland.
Of equal importance is the cameraman’s responsibility to the vast multitudes of people who attend the movies. A simple definition of a motion picture cameraman should necessarily be preceded by a definition of his camera, for that is his medium. The camera, when you get right down to cases, is the eyes of the audience. Thus the cameraman is the censor (I dislike the word but it is applicable here) over the most important of the five physical senses of millions of entertainment seekers. Great is his crime, artistically speaking, if he violates this trust by failing to present in the most telling manner the dramatic content of the plot.
Paradoxically enough, realism suffers in the color medium. The sky, as reproduced, is many shades deeper than its natural blue. The faces of the characters are usually a straw shade. Three prime colors are now utilized but not enough shades are possible with those three. More basic colors would involve too complex a problem to be economically practicable. In the black and white picture, color is automatically supplied by the imagination of the spectator and the imagination is infallible, always supplying exactly the right shade. That is something physical science will continue to find tough competition.
SBF: Martyr, Fool, Addict, Hunger Artist? by Zohar Atkins.
A person who experiences normal amounts of pleasure as a result of normal amounts of effort and decides to be an effective altruist may be said to engage in self-sacrifice. But a person who experiences almost no pleasure and thus is highly generous with their possessions is not really engaged in self-sacrifice. That person is more like Kafka’s Hunger Artist. Their bravado is not born of human pathos but of desensitization and inhumanity.
Where are All the Defaults? by Greg Obenshain.
One reason we believe high-yield spreads haven’t spiked yet is the migration of lower-quality borrowers—those most likely to default—out of high yield and into the private credit market. According to Moody’s, the number of issuers with B3 debt has fallen as these issuers have departed for private credit. They do not mince words about this: “Ultimately, we believe the growth of the alternative asset managers will contribute to systemic risk. This group of lenders comprise both private equity and private credit segments and lack prudential oversight, as opposed to the highly regulated banking sector.”
But if much of the lower-rated lending has been happening in the loan market, does this mean that we should expect that the high-yield spread will not rise if we hit a recession? It is true that the high-yield market has been more resilient both because it has higher-rated issuers and because bond issuers don’t need to reprice their debt right away (64% of high-yield bond maturities are after 2027). But there are still a healthy number of weak issuers in high yield. 45% of issuers are rated B2 or below. Even if we recast the historical high-yield spread as if today’s rating distribution were true throughout the spread’s history, it does not change the historical behavior of the high-yield spread much.
Bonds Plus Alternatives and Chill? by Corey Hoffstein.
Given the current fixed income environment, there is a case to be made that the expected returns of fixed income may be suitable for many investors over an intermediate (e.g. 10-year) horizon. By stacking managed futures on top of core fixed income, investors may be able to further enhance expected returns, creating the potential for equity-like growth without taking equity risk.
Podcasts/Conversations
The Economic Consequences of the Peace, In Our Time.
William Egginton on Kant, Heisenberg, and Borges, Sean Carroll’s Mindscape.
Robert Sapolsky on Determinism, Free Will, and Responsibility, EconTalk. A worthwhile comment courtesy of William Briggs on the pitfalls of determinism.
Long vol, short prediction models 