The hottest Economics Substack posts right now

And their main takeaways
Category
Top Business Topics

Capitalism creates inequality: Stone age edition

Klement on Investing • 4 implied HN points • 31 Jan 25
💼 Business Economics
  1. Wealth inequality has existed since ancient times, even as far back as the Stone Age. Early societies had low inequality, but it started to rise around 6,000 years ago.
  2. The invention of farming led to people settling down, which allowed them to store wealth in crops and livestock. This changed how wealth was accumulated and shared among people.
  3. Over time, technology and the growth of states allowed some individuals to amass even more wealth, leading to high levels of inequality that are still seen in many developed countries today.

Companies don’t wait for tariffs to come into effect

Klement on Investing • 2 implied HN points • 11 Jun 25
💰 Finance Economics
  1. Companies often raise prices immediately when there are announcements of new tariffs. They do this to prepare for higher future costs even before tariffs actually take effect.
  2. Retailers have shown that price increases on imported goods tend to stay high, even if tariffs are later paused or reversed. This suggests that once prices go up, it can be hard for them to come back down.
  3. The price changes from tariffs could impact inflation in the US economy. This means the Federal Reserve may need to pay close attention to these trends to manage economic stability.

[P] PLTR: Lord of the Memes

Nongaap Investing • 5 implied HN points • 06 Dec 24
💰 Finance Economics
  1. Memes can heavily influence stock market trends and investor sentiment. It's important to be aware of how popular online content can affect investments.
  2. Understanding the dynamics of meme stocks is crucial for making informed investment decisions. These stocks can have extreme price swings based on social media activity.
  3. Investing in meme stocks requires careful consideration of both financial metrics and the cultural context surrounding them. Balancing both aspects can lead to better investment outcomes.

The AI 'arms race' fallacy

Platforms, AI, and the Economics of BigTech • 4 implied HN points • 04 Feb 25
🕹 Technology Economics
  1. The AI race isn't just about who has the best technology. It's more about how countries are reshaping global trade and their economic rules through tech exports.
  2. Countries like the US and China are not only building powerful AI but are also influencing how other nations build their own infrastructure based on their standards.
  3. Europe risks falling behind by trying to regulate technology instead of actively shaping it. If it doesn't adapt, it might just follow the rules set by others.

What is Going on With These Tariffs?

Economic Forces • 4 implied HN points • 03 Feb 25
🇺🇸 U.S. Politics Economics
  1. Tariffs are often seen as not helpful for goals like reducing trade deficits, so many economists criticize them. However, understanding the different reasons behind tariffs can help us see their impact better.
  2. The motivations of policymakers when using tariffs can be complex and aren’t always clear in traditional economic discussions. If we consider these motivations, we might get a clearer picture of their potential effectiveness.
  3. It's essential to look beyond conventional views in economics to really understand how policies affect the real world. Digging deeper into these ideas can help us think differently about economic policies.
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Transaction Costs and the UCLA Brand of Price Theory

Economic Forces • 5 implied HN points • 05 Dec 24
💼 Business Economics
  1. The UCLA brand of price theory focuses on transactions instead of just markets. This means they look closely at the details of how transactions happen and what impacts those processes.
  2. Transaction costs are key to understanding decision-making in economics. Knowing how transaction costs affect choices helps explain why some actions happen within firms and others happen between them.
  3. Property rights play a significant role in transaction costs. The restrictions and rules around property ownership can impact decisions and the nature of transactions.

The impact of renewable energy on electricity costs

Klement on Investing • 4 implied HN points • 20 Jan 25
🌞 Climate & Environment Economics
  1. Renewable energy, like wind and solar, generally helps to lower electricity prices rather than raise them. In Spain, for example, these sources cut prices by up to 58% compared to using only fossil fuels.
  2. The recent energy crisis was mainly due to rising natural gas prices, not the shift to renewable energy. Without renewables, the costs and inflation would have been even worse.
  3. While renewables can be less reliable at times, investing in energy storage and other clean sources can solve the supply issues. Stopping the shift to renewables will likely lead to higher electricity bills and inflation.

Getting grandpa back to work…

Klement on Investing • 2 implied HN points • 02 Jun 25
💼 Business Economics
  1. Older workers are valuable for businesses and the economy. Keeping them in the workforce can help boost productivity and growth.
  2. The labor participation rates of older workers are higher in Spain than in the UK, showing that some countries are better at retaining older employees.
  3. Changes in unemployment benefits can motivate older workers to find jobs again, which benefits both the individuals and the economy.

Giving Thanks for Price Theory, 2024 Edition

Economic Forces • 5 implied HN points • 28 Nov 24
💼 Business Economics
  1. Understanding opportunity costs is key. When making decisions, we need to consider not just the money spent, but also what we give up in terms of time and other choices.
  2. Efficiency helps us analyze economic situations. It's not just about being the best, but about understanding how resources can be better allocated and identifying areas needing improvement.
  3. Profits and losses guide resource allocation. They act like signals in the market, showing which businesses are successful and which aren’t, ultimately helping to improve overall economic efficiency.

The MiSeq's Cameras And The Economics of DNA Sequencers

ASeq Newsletter • 14 implied HN points • 06 Nov 23
🔬 Science Economics
  1. DNA sequencers are expensive due to economies of scale, unlike digital cameras that benefit from mass production.
  2. Cheap DNA sequencers could greatly benefit society, but creating them poses technical and sociological challenges.
  3. The cost of components for DNA sequencers, like cameras in the MiSeq, can be broken down to see how much they contribute to the overall expensive price.

US debt is risky: A rant about evidence-based investing

Klement on Investing • 5 implied HN points • 13 Nov 24
💰 Finance Economics
  1. US Treasuries aren't actually risk-free. When the government borrows more without a plan to pay it back, the risk of default increases, which can lower bond prices.
  2. Many finance experts think the US is overspending, yet they still believe that investors will keep buying US debt without questioning it. This is a strange contradiction.
  3. It's important to ask for real proof when investing advice is given. Effective investing should be backed up with solid data, not just opinions or conventional wisdom.

Quant Letter: January 2025, Week-2

The Parlour • 4 implied HN points • 09 Jan 25
💰 Finance Economics
  1. Quant finance uses advanced math and data analysis to make investment decisions. It's all about finding patterns in numbers to predict market trends.
  2. Machine learning is becoming increasingly important in finance. It helps in automating processes and analyzing large amounts of data quickly.
  3. Staying updated with recent research and findings in quant finance can provide valuable insights. It's key to adapt and grow in this fast-changing field.

Clouded Judgement 11.8.24 - Q3 Earnings + Fed Update

Clouded Judgement • 5 implied HN points • 08 Nov 24
💰 Finance Economics
  1. The Fed has lowered interest rates by 0.25%, now sitting at 4.5% - 4.75%. This move aims to support economic growth and labor market stability.
  2. Software companies reported strong Q3 earnings, with all 29 companies exceeding estimates. There's a positive trend in guidance for future quarters as well.
  3. Overall, companies in the software sector are seeing good growth in metrics like Annual Recurring Revenue (ARR), which suggests a brighter outlook for the industry.

Clouded Judgement 5.23.25 - AI Grows the Size of the Prize

Clouded Judgement • 2 implied HN points • 23 May 25
💰 Finance Economics
  1. Venture capital returns can grow as fund sizes increase. The value of successful startups has been climbing, which could mean bigger returns for investors in the future.
  2. Inflation and rising yields are influencing the bond market. As government spending increases and investor concerns grow, yields on U.S. debt are going up, making it more expensive to borrow.
  3. Understanding how software companies are valued is important. These companies are often valued based on their expected revenue, and knowing the growth rates can help investors find the best opportunities.

Why Europe could benefit more from AI and why it probably won’t

Klement on Investing • 1 implied HN point • 14 Aug 25
🕹 Technology Economics
  1. AI has the potential to boost job productivity, especially in white-collar jobs. Although the increases might not be as high as some claim, Europe could benefit slightly more than the US.
  2. European countries with higher income levels may see bigger productivity gains from AI due to their large service sectors and higher labor costs. This makes companies more likely to invest in AI.
  3. However, strict regulations in Europe could significantly reduce these productivity gains. If regulations are too tough, Europe's benefits from AI might be less than those in the US.

The Spice Must Flow: The Dutch-Portuguese War-Part 1

Of All Trades • 10 implied HN points • 20 Jan 24
💾 History Economics
  1. The Dutch-Portuguese War lasted nearly 70 years and involved major powers like Spain, England, France, China, and kingdoms in South Asia.
  2. The conflict represented a clash between capitalism and mercantilism, with the Dutch East India Company fighting for shareholder value.
  3. The war reshaped maritime legal policy, led to the development of Mare Liberum, and catalyzed the rise of capitalism as a dominant global force.

January Roundup (20 Pricing and Packaging Updates)

Good Better Best • 3 implied HN points • 31 Jan 25
💼 Business Economics
  1. There have been many changes in pricing models for software companies lately. Companies are focusing more on how they package and price their services to attract customers.
  2. Features are being adjusted to create clearer paths for customers to upgrade. This includes limiting features on lower plans to encourage users to move to higher-paying options.
  3. Many companies are experimenting with new pricing strategies to improve conversions. For example, adding email trials or changing how users are categorized in plans.

Why have economies become less dependent on labour?

Klement on Investing • 4 implied HN points • 20 Nov 24
💰 Finance Economics
  1. Many economies are using less labor to create goods and services, shifting more towards machines and technology. This means jobs are being replaced by machines, which can work faster and more efficiently.
  2. Countries like Brazil, Russia, and the UK are seeing a slower growth in labor share, possibly because they haven't invested enough in technology. This might make it harder for them to keep up with productivity improvements seen elsewhere.
  3. Factors like the cost of capital, globalization, and the decline of workers' bargaining power can also impact how much labor is used in these economies. Understanding these various elements helps explain recent economic trends.

Considerable overlap

Klement on Investing • 3 implied HN points • 24 Jan 25
🔬 Science Economics
  1. Baboons can learn to assess scatterplots and identify trends, similar to humans. This shows that different species can have overlapping skills in certain tasks.
  2. In general, smart baboons can outperform less intelligent humans in recognizing relationships in data. This highlights that intelligence can vary greatly, even within our own species.
  3. The study suggests that education plays a big role in developing skills, like understanding statistics. Humans often learn these concepts in school, while baboons do not.

Bitcoin, Geopolitics, & Empire

Rounding the Earth Newsletter • 4 implied HN points • 18 Nov 24
🔮 Crypto Economics
  1. Bitcoin aims to replace traditional banks with a decentralized network that can eliminate many banking fees. This could help drive down costs for consumers and reshape financial systems.
  2. If Bitcoin becomes successful, it could reduce the negative impacts of traditional banks, like laundering money and contributing to crime. This might lead to a healthier economy and better lives for people in poorer nations.
  3. While Bitcoin has its challenges, like handling privacy concerns, it offers an opportunity for a more equitable distribution of wealth. The hope is that it drives genuine improvements in people's lives around the world.

How Rich Would 1 Billion Americans Be?

Splitting Infinity • 1 HN point • 21 Feb 24
🔬 Science Economics
  1. The idea of having 1 billion Americans and its impact on the economy has not been seriously considered before.
  2. Estimating the wealth of 1 billion Americans shows potential for tremendous wealth growth, sparking discussions around growth-oriented policies.
  3. Maintaining sustainable growth over the long term can significantly transform the world, emphasizing the importance of steady progress.

Covid-19 Disruption Experiments

Joshua Gans' Newsletter • 19 implied HN points • 21 Dec 20
💼 Business Economics
  1. Covid-19 has forced businesses into experiments, pushing them to face changes they had been avoiding. For example, the movie industry is reevaluating its model post-pandemic.
  2. WarnerMedia is embarking on a disruptive experiment with HBO Max by releasing all 2021 movies on the platform. This move could reshape the industry.
  3. The movie industry is testing a new model by releasing films on streaming platforms first. The outcomes are uncertain but could lead to major shifts in how movies are distributed.

Venstappen Victory Lap

Malt Liquidity • 8 implied HN points • 14 Mar 24
💰 Finance Economics
  1. Food delivery companies like Doordash may struggle to sustain growth post-lockdowns, facing challenges with profitability and expanding their customer base.
  2. Central bank policies face challenges in balancing inflation control and market stability, leading to potential risks of speculative bubbles and volatility.
  3. Inflation can impact investment decisions, prompting individuals to seek ways to outpace the rate of return to counter its effects.

Parallel Tracks: observations from the Jade Empire (Part 1)

East Wind • 7 implied HN points • 02 Apr 24
🕹 Technology Economics
  1. China and the US are in a tech race, but with different goals. China wants to become independent in key tech areas, while the US aims to bring manufacturing back home and limit China's advancements.
  2. China's economy is struggling, leading to a need for change. There are big problems like falling real estate prices and decreased foreign investment, which push China to improve its tech game.
  3. China is doing well in consumer tech, but it’s vying for a bigger role in high-end technologies like EVs and semiconductors. The US is currently ahead in areas like AI, but competition is growing.

Who friendshores and why?

Klement on Investing • 1 implied HN point • 17 Jul 25
💼 Business Economics
  1. Friendshoring is when companies move their supply chains to friendlier nations due to political changes. This shift in focus has become more important since recent changes in US politics.
  2. The decision to friendshore often depends on the political views of a company's CEO. Those aligned with the ruling party are more likely to drop suppliers from adversarial countries.
  3. Changing suppliers for friendshoring doesn’t seem to add value to a company's shares. Sometimes, costs go up or returns don’t change, which can make the move less beneficial.

The Economics of Oppenheimer

Some Unpleasant Arithmetic • 7 implied HN points • 18 Mar 24
🔬 Science Economics
  1. The Oppenheimer movie explores the economics of science and how political beliefs can impact a career trajectory.
  2. Scientific progress is becoming harder and slower, influenced by factors like declining population growth and changing incentives for scientists.
  3. Cluster areas, like El Alamo for nuclear physics, play a significant role in scientific breakthroughs, showing the importance of collaboration and location in innovation.

Best of Economic Forces: 2024 Edition

Economic Forces • 3 implied HN points • 26 Dec 24
💰 Finance Economics
  1. The author reflected on the past year's posts, sharing which ones were popular and enjoyable to write. This is a great way to highlight important topics for new and old readers.
  2. The popular topics included misunderstandings about tariffs and inflation, showing that basic economics is relevant in understanding current issues.
  3. The author expressed gratitude for the growing support from readers, emphasizing the joy and importance of sharing knowledge about economics.

The Index Mindset

The Better Letter • 2 HN points • 24 Mar 23
💼 Business Economics
  1. Don't bet solely on yourself, consider the 'index mindset' for better outcomes.
  2. The 'index mindset' emphasizes risk mitigation over ambition and favors average results.
  3. Active management is crucial in investments and decision-making, the index mindset isn't always the way to go.

Fiscal reaction to interest rate changes

Klement on Investing • 1 implied HN point • 10 Jul 25
💰 Finance Economics
  1. German politicians are more open to increasing debt-financed spending than many people think. They often pay for higher interest costs by issuing new debt.
  2. When faced with rising debt expenses, German officials prefer to cut planned government spending rather than reduce existing programs or raise taxes.
  3. The idea of creating 'blue bonds' in the EU, which could help finance spending and improve productivity, may gain acceptance in Germany despite past resistance to debt.

2x2 games will change your life

Wyclif's Dust • 7 HN points • 24 Feb 24
🚌 Education Economics
  1. Mathematics can change the way you think by showing how words correspond to underlying structures.
  2. 2x2 games, like the Prisoner's Dilemma, are simple models that offer powerful insights into cooperation, trade, and decision-making.
  3. Understanding game theory, particularly 2x2 games, can help in analyzing real-world scenarios such as economics, politics, and social interactions.

Exclusive: The economics of Jumia Food exposed for the first time

Afridigest • 7 implied HN points • 28 Feb 24
💼 Business Economics
  1. The post explores the financial dynamics of Jumia Food, revealing insights into its performance and challenges.
  2. It highlights the shutdown of Jumia Food and the impacts on Jumia's financial results, shedding light on the tough economics of the food delivery business.
  3. The historical adjustments made by Jumia offer an opportunity to study the financial performance of Jumia Food separately, emphasizing the competitive and challenging nature of the industry.