cafeconomics

Not because the world loves Democrats. Not because it is opposed to Republicans. The world is increasingly rooting for Democrats because it wants stability. As America heads into the 2026 midterms, the global mood is clear: governments, investors and allies are less concerned about partisan ideology than about predictability. After years of geopolitical tensions, trade disputes and economic uncertainty, stability has become a scarce commodity. That helps explain why Democrats enter the election with momentum. Recent Reuters/Ipsos polling shows Democrats leading Republicans by 53% to 44% among likely voters, while an Emerson College poll puts the lead at 52% to 42%. Trump's approval ratings remain weak, and concerns about the cost of living continue to dominate voter priorities. [1]( https://www.ipsos.com/en-us/democrats-hold-9-point-edge-midterm-congressional-ballot) The issue is bigger than domestic politics. Trump's supporters see him as a necessary disruptor who ...

Introduction In Chip War, Chris Miller argues that advanced computing power now underpins economic competitiveness, military capability and scientific progress. The race for AI leadership is therefore also a race for semiconductor supremacy. That claim sits awkwardly with an older assumption. If AI runs on data, countries with the largest populations, India and China, should lead it. They don't. The binding constraint has moved from data to compute, and it is now moving again, toward the electricity that powers compute. "Compute is king" is probably a transitional phase. The Early Assumption: More People, More Data, More AI Power For a decade the logic seemed airtight. More people generate more digital activity, which yields more data and better AI. That logic was built for an earlier generation of systems. Recommendation engines, ad targeting, facial recognition and fraud detection learn from behavioural data such as clicks, payments, faces and location trails. Populatio...

In the age of AI no one has time or inclination to read tomes. It's time for some ethical cheating! So here are AI generated summaries of best selling books on Amazon. 1.Sapiens: A Brief History of Humankind (Yuval Noah Harari ) The Cognitive Revolution (70,000 years ago): What set Homo sapiens apart from other human species was our ability to communicate about things that do not physically exist. By creating and believing in shared fictions—religions, myths, nations, and legal constructs—thousands of unrelated individuals could cooperate flexibly. The Agricultural Revolution (12,000 years ago): Harari argues that agriculture was "history's biggest fraud." It did not make the individual farmer's life better or healthier than a hunter-gatherer's; it led to worse diets, longer hours of hard labor, vulnerability to drought, and population explosions that trapped humans in permanent settlements. The Unifiers of Humankind: Global unity was forged by thr...

​In 1992, Acer founder Stan Shih sketched a simple diagram on a whiteboard that went on to govern corporate strategy and globalization for three decades: The Smiling Curve . ​Shih’s thesis was elegant and intuitive. In a globalized electronics supply chain, value concentrates at the two extremes. Upstream, high margins reward abstract intellectual property, fundamental R&D, and circuit design. Downstream, lucrative returns flow to distribution, brand equity, software ecosystems, and customer solutions. ​In the middle sat the trough: fabrication, assembly, and testing. It was the commoditized valley of death—labor-heavy, capital-draining, and subject to intense price competition. For years, the mantra across business schools and boardrooms was unambiguous: go asset-light, capture the IP, outsource the bending of metal and etching of silicon, and collect software-like rents. The historical paradigm: A deep "Commodity Trough" in the middle, leaving fabrication...

For decades, the central dogma of macroeconomics was seduced by a tidy equation: if you want to know how hot the room will get, count the units of fuel sitting in the shed. The logic seemed bulletproof. Flood an economy with paper money, and the inevitable consequence must be an equivalent dilution of purchasing power. Milton Friedman’s famous aphorism—that inflation is always and everywhere a monetary phenomenon—was treated not as a conditional hypothesis, but as an iron law of nature. Yet modern economic history has repeatedly embarrassed this mechanical view. In the years following the 2008 financial crash, central banks printed trillions to recapitalize the financial system; mainstream hyperinflation predictions failed entirely. Conversely, when severe inflation arrived over a decade later, it was driven as much by snarls in microchip supply, shuttered ports, and energy shocks as it was by direct liquidity injections. The persistent error lies in mistaking money aggregates—M1, M2, ...

  From a valley in California to a science park in Hsinchu, the pattern repeats: the state absorbs the catastrophic risk no market will price, and calls it national security. Every country that has built a world-class technology industry from nothing tells itself a founder’s myth afterward—a romantic tale of visionary dropouts, suburban garages, intrepid venture capitalists, and free markets functioning precisely as introductory economics textbooks promise. Almost none of these myths survive rigorous contact with the historical record. Behind the celebrated entrepreneur, in every case worth studying, sits a government that spent years absorbing the existential risk no private balance sheet would touch. In each instance, sovereign planners utilized a military or national-security budget line as the funding vehicle, precisely because that was the sole pot of money in the national treasury not shackled to a quarterly commercial return requirement. This is not an ideological ...