Atlantic City Casinos in Peril: Will Governor Christie Come to the Rescue?

Atlantic City Casinos in Peril: Will Governor Christie Come to the Rescue?

With four out of the 12 casinos in Atlantic City shutting down in the last eighteen months, Wall Street gas been speculating about what these changes indicate. Some believe that the market is right sizing, since the demand for

An Article by Vivek Wadhwa of Stanford

An Article by Vivek Wadhwa of Stanford

Posted by: on Nov 25, 2015 | No Comments

Amazing sneak peek into the future… Very interesting article, will blow your vertical thinking… A bit long, but really worth a read. Article written by Vivek Wadhwa of Stanford

Governments, businesses, and economists have all been caught off guard by the geopolitical shifts that happened with the crash of oil prices and the slowdown of China’s economy. Most believe that the price of oil will recover and that China will continue its rise. They are mistaken. Instead of worrying about the rise of China, we need to fear its fall; and while oil prices may oscillate over the next four or five years, the fossil-fuel industry is headed the way of the dinosaur. The global balance of power will shift as a result.

LED light bulbs, improved heating and cooling system, and software system in automobiles have gradually been increasing fuel efficiency over the past decades. But the big shock to the energy industry came with fracking, a new set of techniques and technologies for extracting more hydrocarbons from the ground. Though there are concerns about environmental damage, these increased the outputs of oil and gas, caused the usurpation of old-line coal-fired power plants, and dramatically reduced America’s dependence on foreign oil.

The next shock will come from clean energy. Solar and wind are now advancing on exponential curves. Every two years, for example, solar installation rates are doubling, and photovoltaic-module costs are falling by about 2o percent. Even without the subsidies that governments are phasing out, present costs of solar installations will, by 2022, halve, reducing returns on investment in homes, nationwide, to less than four years. By 2030, solar power will be able to provide 100 percent of today’s energy needs; by 2035, it will seem almost free – just as cell-phone calls are today.

This seems hard to believe, given that solar production provides less than one percent of the Earth’s energy needs today. But this is how exponential technologies advance. They double in performance every year or two and their prices fall. Given that California already generates more than 5 percent of its electricity from utility-scale solar, it is not hard to fathom what the impact of another few doubling would be: the imminent extinction of the fossil-fuel. Exponential technologies are deceptive because they move very slowly at first, but one percent becomes two percent, which becomes four, eight, and sixteen; you get the idea. As futurist Ray Kurzweil says, when an exponential technology is at one percent, you are halfway to 100 percent, and that is where solar and wind energies are now.

Anyone tracking the exponential growth of fracking and the gradual advances that were being made in conservation and fuel efficiency should have been able to predict, years ago, that by 2015, the price of oil would drop dramatically. It wasn’t surprising that relatively small changes in supply and demand caused massive disruptions to global oil price; that is how markets work. They cause commodities futures and stock prices to fall dramatically when slowdowns occur. This is what is happening to China’s market also. The growth of China’s largest industry, manufacturing, has stalled, causing ripple effects throughout China’s economy.

For decades, manufacturing was flooding into China from the U.S. and Europe and fueling its growth. And then a combination of rising labor and shipping costs and automation began to change the economics of China manufacturing. Now, robots are about to tip the balance further.

Foxconn had announced in August 2011 that it would replace one million workers with robots. This didn’t occur, because the robots then couldn’t work alongside human workers to do sophisticated circuit board assembly. But a newer generation of robots such as ABB’s Yumi and Rethink Robotics Sawyer can do that. They are dexterous enough to thread a needle and cost as much as a car does.

China is aware of the advances in robotics and plans to take the lead in replacing humans with robots. Guangdong province is constructing the world’s first “zero-labor factor,” with 1,000 robots which do the jobs of 2,000 humans. It sees this as a solution to increasing labor costs.

The problem for China is that its robots are no more productive than their counterparts in the West are. They all work 24×7 without complaining or joining labor unions. They cost the same and consume the same amount of energy. Given the long shipping times and high transportation costs it no longer makes sense to send raw materials across the oceans to China to have them assembled into finished goods and shipped to the West. Manufacturing can once again become a local industry.

It will take many years for Western companies to learn the intricacies of robotic manufacturing, build automated factories, train workers, and deal with the logistical challenges of supply chains being in China. But these are surmountable problems. What is now a trickle of manufacturing returning to the West will, within five to seven years, become a flood?

After this, another technology revolution will begin: digital manufacturing.

In conventional manufacturing, parts are produced by humans using power-driven machine tools, such as saws, lathes, milling machines, and drill presses, to physically remove material to obtain the shape desired. In digital manufacturing, parts are produced by melting successive layers of materials based on 3D models – adding materials rather than subtracting them. The “3D printers” that produce these use powered metal, droplets of plastics, and other materials – much like the toner cartridges that go into laser printers. 3D printers can already create physical mechanical devices, medical implants, jewelry, and even clothing. But these are slow, messy, and cumbersome – much like the first generations of inkjet printers were. This will change.

In the early 2020s we will have elegant low-priced printers for our homes that can print toys and household goods. Businesses will use 3D printers to do small-scale production of previously labor-intensive crafts and goods. Late in the next decade, we will be 3D printing buildings and electronics. These will eventually be as fast as today’s laser printers are. And don’t be surprised if by 2030, the industrial robots go on strike, waving placards saying “stop the 3D printers: they are taking our jobs away.”

The geopolitical implications of these changes are exciting and worrisome. America will reinvent itself just as does every 30-40 years; it is, after all, leading the technology boom. And as we are already witnessing, Russia and China will stir up regional unrest to distract their restive populations; oil producers such as Venezuela will go bankrupt; the Middle East will become a cauldron of instability. Countries that have invested in educating their populations, built strong consumer economies, and have democratic institutions that can deal with social change will benefit – because their people will have had their basic needs met and can figure out how to take advantage of the advance in technology

….. Makes one think!!!

Read Rakesh Wadhwa’s comments on this article, by clicking here.

Comments on the Article Written by Vivek Wadhwa of Stanford

Comments on the Article Written by Vivek Wadhwa of Stanford

Posted by: on Nov 25, 2015 | No Comments

I like the article written by Vivek Wadhwa of Stanford, which you can read by clicking here.

  1. Has my last name

  2. I agree substantially and significantly

  3. I was always predicting and, so were many libertarians, that long before world ran out of oil (in fact would not-but that is another story)-the world would learn to do without oil, just like whale oil and wood were replaced by coal, kerosene oil and electricity. So would oil be replaced?

  4. Ayn Rand was talking of oil from shale sands half a century ago.

  5. No one knows for sure what would replace what, but, for sure the world would become energy abundant with costs dipping-the world runs out of nothing-not oil, nor anything else.

  6. Not only not run out of anything but everything after adjusting for inflation gets cheaper in terms of human labour.

  7. Only thing which gets more expensive is human labour-most Indians shall eventually be like their western counterparts-unable to afford servants, drivers, gardeners and security guards.

  8. The future for most shall be better bit by bit.

  9. The only entity which can show this process (as is already happening) is the govt. They will not get out of the way, shall regulate, try to save jobs, interfere, tax too much and thus significantly cause wealth of nations to build much much slower than it otherwise would. But even governments may not be able to stop the inexorable rise of man to eventually so much riches that times now would look like what the past centuries looks to us-poor, impoverished, nasty and Stone Age existence.

  10. Labour saving merely means people would do more interesting things-it never did and never will mean that humans would not have jobs. As electricity, oil, and computers removed drudgery of existence so would the coming age replace uninteresting work and labour with more interesting and more satisfying jobs.

  11. The work time shall become more valuable in terms of productivity and output and the generations to come will in general continue to improve their lives decade after decade with no end ever in sight.

Casino di Venezia – The Mother of Modern Day Casinos

Casino di Venezia – The Mother of Modern Day Casinos

Posted by: on Oct 22, 2015 | No Comments

While taking a ride on a gondola at the Grand Canal in Venice, you will come across several impressive structures of varying origins – from the Fondaco houses of the 13th century to the ones that speak of Byzantine influence, from the Venetian Gothic to the Neoclassical, and from the Venetian Baroque to the Renaissance. As you glide by, preferably humming along to a barcarola from the gondolier, you will probably find it difficult to find just one object of admiration. However, one structure may demand your attention a bit more than others – “a sculpted cloud resting on water” – the grand Renaissance structure, La ‘Vendramin Calergi. This is how you would be introduced to it, but to the gondolier himself, it is the ol’ doge, home of the former Doge of Venice, Leonardo Loredan. This historic shapeshifter has held many distinctions through the centuries, the most prominent of which is that it is home to the world’s first casino.

Origins of the Casino Di Venezia

While gambling may have existed in various forms since the beginning of civilization, casinos as we know them today did not exist until the seventeenth century. The Casino Di Venezia was established in 1638 and has had several branches since. It is only appropriate that the casino should have been born in Venice and at the time that it did. It was in the middle of the Thirty Year War, one of the largest and most destructive conflicts in the history of Europe. Venice remained neutral during the war, which accorded it a period of relative financial stability. At the same time, Spain’s involvement in the war was financed by the taxes that it levied on its Italian dominions, which heavily drained their commerce. This became the ideal climate for organized gambling to prosper. While much of this history is conjectural, proof of its veracity is available in the etymology of the word casino: casa + cina in Italian means little house. It was in the little houses that gambling originated, only to spread to palaces and modern day luxury hotels in due course of time.

Casino Di Venezia in the La ‘ Vendramin Calergi

The Casino Di Venezia launched itself in the iconic palace in 1959, where it continues to operate from till date. By this time, the little houses had given way to decadent backdrops for the affluent to indulge in the thrill of gambling. It also operated out of two other branches, the Lido and the Ca ‘Noghera. However, neither of the other branches enjoyed the kind of distinction that La ‘Vendramin Calergi does, owing to its rich historical backdrop. Can you imagine the thrill of gambling under the same roof that boasts frescoes by Mattia Bortoloni and where Richard Wagner breathed his last? The current Casino Di Valenzia attracts not just people interested in gambling from across the world, but also art lovers and classical music enthusiasts who wish to visit the Wagner Museum.

The Casino Di Venezia Today

Despite its medieval origins, you can be assured of finding all the joys of a modern casino at the Casino Di Venezia. In the rooms dedicated to French games as well as on the American gambling tables, you will find every kind of game that you may fancy, from Baccarat, Black Jack and Roulette, to Texas Hold ’em Poker and Caribbean Stud Poker. The casino all has over 600 slot machines for those who prefer a more informal form of gambling. The total jackpots for grabs at the Casino di Venezia’s two existing venues is a whopping €3,045,229.14, as of September 1, 2015.

However, all is not as hunky dory as it seems from the outside. The current economic situation in Europe has sent the casino directors looking for private investors, but to no avail. In 2013, the taxes charged by the local commune were slashed, so that the Casino Di Venezia closed its 2012 balance sheet at a total revenue of €123 million. This was done in an attempt to attract private investors. In 2014, the city council of Venice which has been running the casino since 1946, issued a tender offering a 30 year deal to a private investor for €500 million. However, they have had no bids at that price. An article in May 2014 had stated that the Slovenian Gambling Firm, Casino Hilt, may have been interested, but nothing has been known to materialize yet. It can only be hoped that the casino that holds within its walls the very history of gambling, will not be allowed to shut down without a better fight.

Bryan Caplan: The Man Who Made Economics Cool

Bryan Caplan: The Man Who Made Economics Cool

Posted by: on Oct 15, 2015 | No Comments

This young professor of Economics at George Mason University and Senior Scholar at Mercatus Center is not afraid to brandish his ideas in circles outside academia. While he may not be as prolific as many traditional academicians, his methods are more popular. A blogger at EconLog, he has written on subjects as diverse as homeschooling, open borders and even the relationship between betting and libertarianism. His books, The Myth of the Rational Voter and Selfish Reasons to Have More Kids, espouse theories that offer a clean break from current practices and are lucid enough to warrant the acclaim that they have received. Most of all, his theories are appealing because the average person can relate to them. They are not obscure formulations that are made to obtain the approbation of the already enlightened, they are meant to enlighten those that are not there yet.

Pacifism and Open Borders

His general appeal can be surmised to lie in the fact that he uses a self-confessed “common-sense case” to arrive at his beliefs. That is how he claims to have derived the three steps owing to which he aligns himself with the pacifists. The steps include acknowledging simple facts like the immediate costs of war are awful, the long-run effects of war are highly uncertain and that for a war to be morally justified, its long run benefits have to be much larger than its short term costs. Add to this the fact that despite the already skewed findings of the case in favour of pacifism in the short term, there will be even more unforeseen long term costs that generations will bear, and there is no rational way in which you can justify war.

In addition, Caplan is also one of the leading proponents of open borders as he believes that immigration restrictions perpetuate poverty and restrict individual freedom. His radical resolution for this is, “Let anyone take a job anywhere.” By saying this, he favours high skilled, high tech workers from anywhere in the world, who should be legally allowed to take a job anywhere from a willing employer. He clarifies that this is not the same as saying that anyone should be allowed to become a citizen anywhere.

An Anarcho-Capitalist

Bryan Caplan clearly traces his influences to the Austrian School and stalwarts like Murray Rothbard and the Chicago School academician, David D Friedman. He supports their ideas of a stateless society and also aligns himself with theories of anarcho capitalism, as espoused by Michael Heumer. He has authored a book with Peter Jaworski, called Markets Without Limits, in which the primary thesis is that any service that can be given away for free, one may sell for money. The flipside of this is that anything that cannot be deemed proper objects of sale, are things that should not be done or had anyway. Therefore, the theories that contest unbridled markets on the basis of “contested commodities” or “noxious markets” must realize that the markets that introduce harmful objects are detrimental because the objects themselves are detrimental to the larger good, and not because the markets have introduced them in a place where there were no harmful objects to begin with.

Public Choice Theory

This is the domain that consists of the bulk of Caplan’s work. His first book, The Myth of the Rational Voter: Why Democracies Choose Bad Policies, which was dubbed “The Best Political Book of the Year” by The New York Times, speaks of the rational irrationality allowing those with systematic biases, i.e., the voters, to determine policies. He has a simple observation to make about why democracy cannot work – because it is a commons, not a market. He concurs with economists like Donald Whittman, who have found through their scholarship that traditional public choice has arrived at conclusions that are inconsistent with the canonical assumption of voter rationality. Most importantly, Caplan has done commendable empirical work that suggests that public opinion is in fact systematically biased about economics.

Caplan has, over time, also espoused several other theories and has taken firm stands in matters regarding economic policy. However, while the theories themselves are commendable, their true value lies in the fact that they are expressed in a way that unpacks complex theory in a way that can be applied in day to day life. He takes free market thought and converts it into free market spirit so that it is available to one and all.

Implications of Legalizing Casinos in Israel

Implications of Legalizing Casinos in Israel

Posted by: on Oct 10, 2015 | No Comments

Yariv Levin, Israel’s Tourism Minister, confirmed on September 23, 2015, while speaking on national radio that there is indeed a proposal, backed by Prime Minister Binyamin Netanyahu, to legalize casinos on mainland Israel at last. He openly condoned the decision and went on to talk of his own role in conducting an inquiry into the matter, the conclusions of which will determine the fate of the said proposal. In the 1990s, casino magnate Sheldon Adelson had attempted to make forays into the market, but had been held back on account of the contentious status of gambling in the country. While the people of Israel are allowed to bet on some things, casinos have till date remained illegal within the territory of Israel. With this revolutionary move, the Prime Minister is set to alter the course of Israeli economy. However, in order to truly understand the true import of this move, one must understand the context within which it will be operating.

Gambling in Israel

It would be wrong to say that gambling in all its forms has been illegal in Israel. However, whatever gambling exists in the country is highly regulated by the government. While casino gambling has been illegal, there are a number of Israeli cruise ships that offer casino games to customers. Eilat, the city in which the first casino is being proposed, has been, for many years, the port from which these ships sail into neutral waters in order to legally offer gambling. Sports betting and lottery enjoy government support, even though they are closely regulated by the Israeli Commission for Sports Gambling and the Mifal Hapayis, respectively.

Prevalence of Illegal Gambling

Another form of gambling that thrives is online gambling, although local companies are not allowed to run such operations on the internet and the government has taken strict measures to ensure that citizens do not engage with international companies that do so. However, one only needs to look online to know that there are a large number of online gambling sites that accept payment in Israeli Shekels for the convenience of their Israeli patrons. It is not surprising then that illegal gambling and betting rake in billions of dollars each year in Israel. Such illicit gambling persists in the hands of leaders of organized crime, many of whom are headquartered at Eilat. Ian Ben-Shitreet, the alleged kingpin of illegal gambling in Eilat, was convicted by the Be’er Sheva District Court on the charge of attempt to murder and racketeering on September 2, 2015.

History of Casinos in Israel

In September 1998, Yasser Arafat started the first for-profit, foreign investment driven venture in the Palestinian territory – an Austrian run hotel-casino called Oasis, located amidst the deserts of Jericho, meant to cater to Israelis. It was a $50 million project, which could have translated to millions in tax revenue for the then in need Palestinian authority. The 1993 Oslo Accords had accorded Jericho the status of the first West Bank City in which the Palestinians had complete civil and security control. Therefore, to some, the Oasis hotel came to symbolize the hope of peace between Israel and Palestine. These hopes came crashing down with the Second Intifida in 2000, the second Palestinian uprising against Israel and with them, the shutters went down on the Oasis.

Implications of Legalizing Casinos in Eilat

There is no doubt that Israelis are fond of gambling, given the incidence of illicit ventures that run in bomb shelters in southern Israel or the large numbers that cross the borders to visit Egypt’s Red Sea resorts. That there is a demand for a casino in Israel, thereby making it a potentially lucrative venture, is undisputed. However, the hurdles that are to be crossed are religious, political and judicial.

The Prime Minister has authorized both Yariv Levin and Yisrael Katz, the transport minister, to assess the ramifications of such a move. They are well aware of the socio-economic benefits that such a move could portend, especially for a war-ridden, beleaguered nation like Israel, but they are also conscious of the importance of levying restrictions and supervision so that the venture does not turn into “an incubator for crime.” If they are able to realize the plan, they might well find that they are able to finally prevent the potential of the project from serving the cause of crime and use it to restructure the society in a fruitful manner.

Atlantic City Casinos in Peril: Will Governor Christie Come to the Rescue?

Atlantic City Casinos in Peril: Will Governor Christie Come to the Rescue?

Posted by: on Sep 28, 2015 | No Comments

With four out of the 12 casinos in Atlantic City shutting down in the last eighteen months, Wall Street gas been speculating about what these changes indicate. Some believe that the market is right sizing, since the demand for

Free Market Advocacy Think Tanks in India

Free Market Advocacy Think Tanks in India

Posted by: on Sep 21, 2015 | No Comments

Free market thinkers could be largely categorized into three distinct types – Anarchists, Minarchists and Minimaxes, representing varying degrees of government control. The Anarchists, as evident from the name, believe in zero intervention

Donald Trump: From Casino Magnate to Presidential Candidate

Donald Trump: From Casino Magnate to Presidential Candidate

Posted by: on Sep 14, 2015 | No Comments

Donald Trump came to be known all over the world for his sardonic humor and his magnetic personality when he starred in the famous television show, The Apprentice. Having first aired in 2004, the show ran for 14 seasons in two formats, The

If Reagan, Thatcher and Modi were to Meet…

If Reagan, Thatcher and Modi were to Meet…

Posted by: on Sep 14, 2015 | No Comments

There is a lot of speculation about how Narendra Modi is the Indian Ronald Regan, or in some other circles, the Indian Margaret Thatcher. While the comparisons are not unfounded, the three have distinct personalities and distinct

Free Market Thinkers who Won the Sveriges Riksbank Prize in Economic Sciences

Free Market Thinkers who Won the Sveriges Riksbank Prize in Economic Sciences

Posted by: on Sep 7, 2015 | No Comments

In The Making of Modern Economics: The Lives and Ideas of Great Thinkers, Mark Skousen, the esteemed economic analyst, stated that the Swedes mostly rewarded free-market economists. The Swedish Central Bank started the Prize