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P.S. You Should Know... | Issue #220

June 13 · Issue #220 · View online
P.S. You Should Know...
👋 Welcome back to P.S. You Should Know… probably the best newsletter published on Sundays between 6-7am CST, and definitely the best one published by me. Now in its fifth year!

my story 🚀
Some musings from this week…
  1. It’s hard to tax the rich. Carried interest is a remarkable tax loophole for investors across venture capital, private equity and hedge funds. Essentially, money earned by investing other peoples’ money over a long time counts as investment gains not ordinary income, creating a huge tax advantage. President Biden is planning to raise the capital gains tax, removing that advantage. But not so fast! Sequoia, at least, has a contingency plan. The tax code is complex and tax accountants, I assure you, can be very creative. For those with a lot of money at stake, there’s plenty of incentive to discover new tax-minimizing strategies.
  2. But how fair is blaming the rich? ProPublica somehow obtained tax returns of popular and wealthy Americans Jeff Bezos, Elon Musk and Warren Buffet. They made up a “true tax” rate that calculate effective tax rate based on income plus estimated asset appreciation. Predictably, their “true tax” rates are shockingly low! They range from 0.10% to 3.27%. As shocking as this might be, I don’t view it as a useful analysis. The common factor here is asset appreciation, and these particular fellows happen to own appreciating assets. Oh, and they happen to have largely created those assets. So, what we learn by studying their “true tax” rates is that they didn’t choose to sell those assets during the year.
  3. To sell or not to sell. The well-known trio above are not the only ones who face this choice. Many of us have appreciated assets that we could sell at any given time. When we sell, we know we’ll face the consequences – tax and otherwise. If you sell your Amazon stock today, you’ll owe income taxes on the gains and also miss out on any future appreciation. But if you hold that stock in the right brokerage account, you can borrow against its value instead of selling it. While you’ll pay (very little) interest on the loan, you won’t pay taxes because the proceeds aren’t income. This option is not exclusively for the wealthiest Americans – as little as $10k in an account can qualify. Now, of course, you must eventually repay that money and the interest rate might change at any time. But, as ProPublica appropriately states: “If you can avoid income, you can avoid taxes.”
fun facts 🙌
China’s WeChat bans nose-picking, spanking. “Besides nose-picking and spanking, other "vulgar” activities that are banned include putting underwear over one’s head and focusing the camera lens on sensitive parts of the body, such as the chest or buttocks,,.“ | learn more
The emperor’s new sculpture. “Last month, the 67-year-old artist Salvatore Garau sold an “immaterial sculpture”—which is to say that it doesn’t exist.” The price? $18,300. | learn more
Lobsters can get high. “The impetus for this groundbreaking study: a Maine restaurant that’s famous for hot boxing lobsters. Back in 2018, restaurateur Charlotte Gill of Charlotte’s Legendary Lobster Pound sent the internet into a tizzy when she told a local newspaper that she was experimenting with marijuana in hopes creating a more humane way to kill lobsters.” | learn more
oh, chicago 🏆
CPD investigating video of 3 women dancing on top of police cruiser. Everyone seems to be having fun. | learn more
tech, startups, internet ⚡
People are waking up to the importance of sleep. “With sleep playing such a big role in a person’s metabolic, immune, mental and overall health, it’s time for people to start taking their sleep seriously. How do you do that? According to Chicago entrepreneur Jeff Kahn, two actionable ways to do that are by adjusting your schedule to your circadian rhythm and reducing your sleep debt.” | learn more
better doing 🎯
Working from home productivity data from 150,000 employees. “Workers accomplished the same amount but spent 2 hours more per day (7h vs 5h) at the office. So despite a reduction in commute hours, this company’s productivity declined (defining productivity as output per hour.)” | learn more
to your health ⚕
Learn your biological age from the comfort of your own home. This article in Wired (a couple years old) highlights companies that commercialize epigenetic clocks that predict biological age. I first learned of this technology in the book Lifespan, but I haven’t paid to take my own test yet. Have you? | learn more
The first new Alzheimer’s drug since 2003 approved by FDA. The approval came despite the advisory committee’s near-unanimous vote against it. “The ap­proval, how­ev­er, will do lit­tle to quell crit­i­cisms from the swath of Alzheimer’s re­searchers, bio­sta­tis­ti­cians, and clin­i­cians who have ar­gued that Bio­gen cher­ry-picked da­ta and failed to show con­vinc­ing ev­i­dence that the drug can slow pa­tients’ cog­ni­tive de­cline.” | learn more
under the microscope 🔬
Using DNA to predict intelligence. A short and intriguing research paper. “Thousands of DNA variants have been identified that – aggregated into genome-wide polygenic scores (GPS) – account for more than 10% of the variance in phenotypic intelligence. The intelligence GPS is now one of the most powerful predictors in the behavioral sciences.” | learn more
3D printing of sensors directly on expanding organs. “The new technique allows for even more sophisticated tracking to 3D print sensors on organs like the lungs or heart that change shape or distort due to expanding and contracting.” | learn more
Scientists develop ‘cheap and easy’ method to extract lithium from seawater. We need a lot of lithium because we need a lot of batteries. More battery manufacturing facilities are being funded than lithium extraction facilities. | learn more
teaching the kids 👩‍🏫
Bill Maher and Mike Rowe share a view on higher ed. Maher recently included a segment on his show that overlaps with many of Rowe’s ideas. “I want people to radically rethink higher education. Toward that end, I’ve always maintained that making a four-year degree “less expensive” is a great symptom, but a lousy goal. The better goal is to make a four-year degree less necessary than it currently is. That’s not an “anti-education” position. It’s a cry for rationality, proportionality, and common sense.” | learn more
The history of homework. “Homework is long-standing education staple, one that many students hate with a fiery passion. We can’t really blame them, especially if it’s a primary source of stress that can result in headaches, exhaustion, and lack of sleep. … It makes one wonder, who in their right mind would invent such a thing as homework?” | learn more
big ideas 📚
The best science isn’t peer-reviewed yet. There’s a unique problem that comes with a formal peer-review publication process. “We’re going to kill ourselves because of stupidity.” | learn more
Founding vs inheriting institutions. Inside this post Balaji describes a concept of read-only culture: “the ability to repeat what an ancestor has handed down – but not recreate it from first principles.” It reminds me of cargo cults a bit. | learn more
on the blockchain ⛓
How did the feds recover the ransomware Bitcoin payment? “On June 7, the United States Justice Department and the Federal Bureau of Investigation (FBI) announced the “recovery” of 63.70 bitcoin from the funds Colonial Pipeline sent to the hackers. The official story has a number of inconsistencies and federal investigators did not disclose how the FBI was able to confiscate the Darkside gang’s private key.” | learn more
calls to action 👇
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