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Manhattan: a city of empty luxury condos and overflowing homeless shelters

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New York's luxury real-estate market has been in freefall for years, and now the city's super-luxe buildings are sitting empty -- even as property prices in the city remain stubbornly high, prompting 300 New Yorkers to move out of the city every day, and filling the homeless shelters to capacity and beyond.

New York -- like most overpriced cities -- has failed to build enough low- and middle-income housing of the sort that people use to live in, and has grossly oversupplied itself with the kinds of safe deposit boxes in the sky that oligarchs use as a form of medium-term asset class, possibly without ever occupying it.

The luxurification of cities isn't an accident. When Michael Bloomberg was mayor of New York, he explicitly encouraged "bluelining" -- designating whole regions as luxury-only, aimed at the global super-rich -- saying that he wanted New York City itself to be viewed as a luxury good.

The problem with this plan -- apart from it being an inhumane form of ethnic cleansing that chases working people out of our cities -- is that it only works if there are enough global oligarchs chasing these super-luxe condos to keep the market inflated and liquid (oligarchs have viewed luxury property in big cities as being nearly as liquid as cash, because for a time, you could flip them on just a few days' notice).

But three of the most important centers of oligarchic capital have dried up: China instituted strict currency controls and its economy is slowing, and Saudi and Russian oligarchs are much less flush than they were when oil prices were at their peaks.

The result is a death-spiral for super-luxe property: as bidders dry up, more oligarchs decide that real-estate isn't basically a form of cash that you can spend a weekend in from time to time, and put their properties on the market. The supply increases, driving down prices, and that prompts more absentee owners to list their properties, hoping to get out before the market craters altogether. Meanwhile, property developers have new units coming into the market, and resort to bulk-sales to investment trusts, or simply buying the units themselves in a paper shuffle meant to inflate prices.

It's not just New York, of course -- London's going through the same process, accelerated by Brexit.

It would be funny if it wasn't for the housing priorities that languished while the world's Bloombergs were remaking our cities into investment opportunities instead of places to live and work. New York's got 80,000 people living in shelters or sleeping on the streets. Los Angeles has so many homeless people that it distorts the national average, and it's creating a public health crisis as typhus spreads through the sprawling, semi-permanent homeless camps.

Seattle is scarred with massive homeless camps where life is a grinding misery, and thanks to Amazon's lobbying, the best chance the city had at relief was killed.

San Francisco is in the fourth decade of its homelessness crisis with no end in sight: efforts to do something about the crisis have been sabotaged by corporate money from Lyft and Stripe; the city spends $65m/year just cleaning up human shit (but only allocated $3.1m/year to providing toilets); and local vigilantes punish the homeless rather than demanding a fix from the city.

A decade ago, a housing bubble was weaponized to destroy the entire world economy, kicking off instability and chaos that we're still living through to this day. And yet, our governments at all level are insisting that it's up to the market to supply low-income housing, while our neighbors are left to sleep and shit and die in the streets, in the shadows of empty super-luxe buildings that not even plutes want anymore.

From any rational perspective, what New York needs isn’t glistening three-bedroom units, but more simple one- and two-bedroom apartments for New York’s many singles, roommates, and small families. Mayor Bill De Blasio made affordable housing a centerpiece of his administration. But progress here has been stalled by onerous zoning regulations, limited federal subsidies, construction delays, and blocked pro-tenant bills.

In the past decade, New York City real-estate prices have gone from merely obscene to downright macabre. From 2010 to 2019, the average sale price of homes doubled in many Brooklyn neighborhoods, including Prospect Heights and Williamsburg, according to the Times. Buyers there could consider themselves lucky: In Cobble Hill, the typical sales price tripled to $2.5 million in nine years.

This is not normal. And for middle-class families, particularly for the immigrants who give New York City so much of its dynamism, it has made living in Manhattan or gentrified Brooklyn practically impossible. No wonder, then, that the New York City area is losing about 300 residents every day. It adds up to what Michael Greenberg, writing for The New York Review of Books, called a new shameful form of housing discrimination—“bluelining.”

Why Manhattan’s Skyscrapers Are Empty [Derek Thompson/The Atlantic]

(Image: Michael Vadon, CC BY, modified)

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diogro
6 days ago
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CollegeHumor laid off almost everyone because they trusted Facebook's inflated metrics

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Almost 100 people working for CollegeHumor in Los Angeles and New York were let go yesterday, reports Bloomberg. The owner, Barry Diller's IAC, sold the brand to its chief creative officer. Only "five to 10 people" remain employed.

CollegeHumor suffered the same fate as Funny or Die, which went through rounds of layoffs in recent years. Why did these media companies, which make good content, fail so spectacularly? Because they trusted Facebook, which wooed them to its platform with grossly exaggerated viewer metrics.  CollegeHumor and Funny or Die staffed up to meet the imaginary demand, then Facebook pulled the rug out from under them.

Adam Conover, who worked for CollegeHumor, explained the situation in a Twitter thread:

Facebook, which was sued by advertisers for cooking its stats, settled out of court for $40 million and steadfastly refuses to admit any wrongdoing. Read the rest

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diogro
15 days ago
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Explaining the con that is private equity

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Emily Stewart's private equity explainer for Vox is a great explainer on how the PE con works: buy up businesses, load them with debt, sell off their assets, slash their costs, then walk away as the house burns, leaving society to put out the fire -- all while enjoying special tax status on your gains.

It's a great companion-piece to Matt Stoller's "Why Private Equity Should Not Exist." Stewart's got a delicious opener, though: she notes that in 2010, Doug Lowenstein -- the top US private equity lobbyist -- wrote a letter complaining about a PBS special on the problems of PE, touting Toys R Us as PE success story.

But by 2017, the private equity looters who took over Toys R Us had looted the company into ruin, paying themselves hundreds of millions in bonuses, stealing their workers' pensions and severance, and leaving their workers' private data sitting behind in ruined stores for anyone to find and steal.

To explain leveraged buyouts in easier-to-understand terms, let’s say you buy a house. Under normal circumstances, if you can’t pay for the mortgage, you would be in trouble. But by the LBO rules, you’re only responsible for a portion. If you pay for 30 percent of the house, the other 70 percent of the asking price is debt placed on the house. The house owes that money to the bank or creditor who lent it, not you. Of course, a house can’t owe money. But under the private equity model, it does, and its assets — its factories, stores, equipment, etc. — are collateral.

The idea, in theory, behind private equity is that the endeavor will be worth it — for both you and the house. “There are many companies that, if not for private equity, would not be able to get access to the kind of capital they need to scale, to transform, to turn around, and to have succession planning,” said one industry source, who requested anonymity to speak candidly for this story.

But because of the debt companies end up owing creditors as part of a deal, they sometimes find themselves with such high interest payments that they can’t make the investments necessary to be competitive or even stay afloat. Plus, companies often take out additional loans to pay private equity investors dividends, and then they pay a fee if and when they are sold. If they can’t pay off the debt, the companies are on the hook, and their employees and customers are the ones to suffer the consequences.

And private equity’s No. 1 priority isn’t the long-term health of the companies it buys — it’s to make money, and as is the case in so many facets of investing today, to make money fast.

What is private equity, and why is it killing everything you love? [Emily Stewart/Vox]

(via Naked Capitalism)

(Image: Mike Kalasnik, CC BY-SA, modified)

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diogro
17 days ago
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TT2020: an old-timey typewriter typeface that doesn't look fake

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TT2020 is "an advanced, open source, hyperrealistic, multilingual typewriter font for a new decade!" As there already are so many, why another? Creator Fredrick Brennan (previously) points out that most fonts which attempt to create the look of a real analog typewriter lack alternative glyphs and other modern features, displaying tell-tale repetitions of aberrations and flaws. He spotted some recent howlers in expensive Hollywood productions that should know better, such as The Joker.

The absurd lack of realism displayed here let me know that I could put this project off no longer. In case you don't see anything wrong ... In the second image, there are three ‹N›’s. Yet, they all look exactly the same. A real typewriter can, quite rarely, have one of its letters damaged, or misaligned, such that that letter regularly makes an inferior strike to all the other letters. However, this degree of regularity is impossible; could Underwood or Remington have acheived it, they would have leapt for joy. It is therefore clearly a digital facsimile and not a real typewritten document.

The example he shows from The Irishman is similarly egregious. Doesn't anyone in Hollywood own a real typewriter?

TT2020 comes in a variety of weights and styles to emulate specific reproduction environments. It's open-source, too, with technical notes to enjoy.

TT2020 [ctrlcctrlv.github.io]

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diogro
20 days ago
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Ecomorphological specialization leads to loss of evolvability in primate limbs

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Primate limb morphology is often described as either generalized, i.e., suited to a range of locomotor and positional behaviors, or specialized for unique locomotor behaviors such as brachiation or bipedalism. The evolution of highly specialized limb morphology may result in loss of evolvability, i.e., in a decreased capacity of the locomotor skeleton to evolve in response to selection towards alternative ecomorphological niches. Using evolutionary simulations, I show that the highly specialized limb anatomy of hominoids is associated with a significant loss of evolvability, defined as the number of generations to reach alternative adaptive peaks, and in parallel an increased risk of extinction, particularly in simulated evolution towards generalized quadrupedal limb proportions. Loss of evolvability in apes and humans correlates with three factors: (1) decreased correlation among limb bone lengths (i.e., integration), which slows the rate of change along lines of least evolutionary resistance, (2) limb specialization, which places apes and humans in relatively remote areas of morphospace, and (3) increased skeletal size as a proxy for body size. Thus, locomotor over‐specialization can lead to evolutionary dead‐ends that significantly increase the probability of hominoid populations going extinct before evolving new adaptive morphologies.

This article is protected by copyright. All rights reserved

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diogro
33 days ago
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Hey—the 2nd-best team in baseball is looking for a Bayesian!

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Sarah Gelles writes:

We are currently looking to hire a Bayesian Statistician to join the Houston Astros’ Research & Development team. They would join a growing, cutting-edge R&D team that consists of analysts from a variety of backgrounds and which is involved in all key baseball decisions at the Astros.

Here’s a link to the job posting on Stack Overflow; if anyone in particular comes to mind, we’d appreciate your encouraging them to apply. They’re also welcome to reach out to me directly if they want to further discuss the role and/or working in baseball.

They just need one more left-handed Bayesian to put them over the top.

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diogro
52 days ago
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