What we’re reading (2/13)
“Ackman’s Pershing Square Suffers From The ‘Passive’ Phenomenon” (Institutional Investor). “A number of Pershing Square’s dozen stock holdings aren’t in the index, which helps put his hedge fund’s performance in perspective. Last year, the net gain of 10.2 percent for Ackman’s Pershing Square Holdings, his publicly traded hedge fund, was less than half of the 25 percent gain for the S&P 500. The 2024 showing also dragged down the vehicle’s annualized performance below the S&P 500, according to the investor presentation. Pershing Square has far outdone the S&P 500 since it was launched in 2004, but most of those gains were in the earlier years — before the passive trend took hold. Ackman’s publicly traded fund, which was launched on Dec. 31, 2012, has an annualized net performance of 13.5 percent, compared with 14.8 percent for the S&P 500.”
“The Emperor’s New Tariffs: Small, Ugly And Stupid” (Paul Krugman). “Finally, the stupid part: Steel and aluminum aren’t consumer goods. They’re ‘intermediate inputs,’ used in the production of other things, notably cars and aircraft. Imposing taxes that raise the prices of these goods might encourage more U.S. production of metals (although that didn’t happen to any large degree the last time Trump imposed tariffs), but it will raise costs throughout the rest of U.S. manufacturing, making it less competitive and reducing employment. Even if we ignore indirect effects via interest rates, the dollar and so on, these tariffs are almost certain to reduce, not increase, manufacturing employment.”
“The Scientific Literature Can’t Save You Now” (The Atlantic). “Profit motive can sometimes trump quality control even at the world’s largest publishers, which earn billions annually. It also fuels a ravenous pack of ‘paper mills’ that publish scientific work with barely any standards whatsoever, including those that might be used to screen out AI-generated scientific slop. An empiricist might say that the sum total of these articles simply adds to human knowledge. If only. Many, or even most, published papers serve no purpose whatsoever. They simply appear and … that’s it. No one ever cites them in subsequent work; they leave virtually no trace of their existence. Until, of course, someone convinces a gullible public—or a U.S. senator—that all research currency, new and old, is created equal.”
“Why Dealers Are Flying Gold Bars By Plane From London To New York” (Wall Street Journal). “Gold is, for the moment, worth substantially more in Manhattan than in the U.K. capital, sparking the biggest trans-Atlantic movement of physical bars in years. Traders at major banks are racing to yank gold from vaults deep below London’s medieval streets and from Swiss gold refineries and ferry them across the ocean. The cheapest way to transport such a valuable commodity safely: the cargo hold of commercial planes.”
“The Prison Routine Of Theranos founder Elizabeth Holmes: Clerking For 31 cents An Hour, Teaching French, And Reading ‘Harry Potter’” (Business Insider). “An inmate handbook for the federal minimum-security women's prison in Bryan, Texas, where she is incarcerated, says all medically cleared inmates are required to have a regular job for at least 90 days. Holmes has several jobs in the prison, including one as a reentry clerk, for which she makes 31 cents an hour helping prisoners expected to be released soon...She's also a law clerk and teaches French classes, the magazine said.”
