Hidden Forces

In this Christmas Day special of Hidden Forces, Demetri Kofinas shares twenty-five minutes of never-before-heard audio from his conversation with Howard Marks, but not before announcing the long-awaited-for launch of the Hidden Forces subscription service. Subscribers can gain access to overtime segments, transcripts, and rundowns from each and every episode. Subscriptions require creating a Patreon account, but can be accessed directly through the Hidden Forces website via subscription tabs located within any particular episode Producer & Host: Demetri Kofinas Editor & Engineer: Stylianos Nicolaou Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

In Episode 71 of Hidden Forces, Demetri Kofinas speaks with James Mulvenon, Vice-President of Defense Group Inc.'s Intelligence Division and Director of DGI's Center for Intelligence Research and Analysis. Dr. Mulvenon is an expert on the Chinese military and Chinese cyber issues and has published widely on Chinese military affairs, party-army relations, C4ISR, and nuclear weapons' doctrine and organizations. He's a regular commentator on the Chinese military, cyber warfare, and Chinese industrial espionage, all of which we discuss in today's, hour-long conversation. This episode was prompted by the recent arrest of telecommunications giant Huawei's CFO Meng Wanzhou during her transit through Vancouver airport on December 1st, 2018. Meng is currently out on bail, awaiting the service of a formal extradition request from the United States on charges related to Huawei's alleged evasion of Iranian sanctions. James has been investigating and writing about Chinese commercial espionage, and in particular about Huawei, for years, which makes him the ideal person to speak to about this ongoing, diplomatic drama and its implication for US-China trade talks. Will Trump's hard-nosed, no-holds-barred negotiating style work to level the playing field between these two countries? More importantly, is it time to acknowledge that our multi-decade long effort to integrate China into the neo-liberal world order has failed and that a new strategy must be developed to deal with a more obstinate and adversarial China? Considering the important role played by information technology in the 21st century, any strategy for confronting China must also deal with the country's cyber capabilities and its use of commercial espionage in the service of champion companies like Huawei. These are just some of the topics we consider in today's conversation. Producer & Host: Demetri Kofinas Editor & Engineer: Stylianos Nicolaou Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

In Episode 70 of Hidden Forces, Demetri Kofinas speaks with Andrei Shleifer, professor of economics at Harvard University. Dr. Shleifer is the most cited economist in the world according to RePEc's database. Throughout the course of his career, Andrei Shleifer has worked in the areas of comparative corporate governance, law & finance, behavioral finance, as well as institutional economics. He has published seven books, including, A Crisis of Beliefs: Investor Psychology and Financial Fragility with his co-author Nicola Gennaioli. Demetri's conversation with Andrei centers on the subject of beliefs: how they impact markets and how economists and financial practitioners are attempting to model them using data about people's expectations, assumptions, and attitudes in order to make better-informed investment and policy decisions. The first half of the episode is devoted to exploring the mechanics of the 2007-2008 credit crisis, and the role played by structured products and derivatives, off-balance sheet vehicles, money market funds, GSE's, and a policy of ultra-low interest rates that fueled over-confidence in the power of regulators and in the sustainability of the status quo. In the second half, Dr. Shleifer provides us with a more formal approach to thinking about Hyman Minsky's instability hypothesis and how market participants can draw radically different conclusions about that same data when their beliefs about the world change dramatically. Given the destabilizing forces of populist politics, trade tensions, and changing geopolitical fault lines, the ability to draw valuable insights from data about expectations and beliefs is invaluable for any investor or policymaker looking to gain a sense of market sentiment: where it stands and where it might be going. Producer & Host: Demetri Kofinas Editor & Engineer: Stylianos Nicolaou Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

In Episode 69 of Hidden Forces, Demetri Kofinas speaks with renowned philosopher and novelist Rebecca Goldstein, about the philosophy of mattering and what makes human life worth living. The question of "what makes life worth living," is something that human beings have been grappling with since time immemorial. Perhaps, nowhere did this question pose a more existential imperative than in ancient Greece, which provides the setting for this conversations. The show begins with an anecdote from "The Histories of Herodotus," where the ancient historian recounts the story of King Croesus, the late ruler of Lydia, who governed the lands of western Anatolia in the mid-sixth century B.C. At the height of his reign, Croesus was visited by Solon, the lawgiver who had just laid the foundations for Athenian democracy. "Stranger of Athens," inquired Croesus, "we have heard much of thy wisdom and of thy travels through many lands, from love of knowledge and a wish to see the world. I am curious therefore to inquire of thee, whom, of all the men that thou hast seen, thou deemest the most happy?" Croesus, expecting to hear the sound of his own name sung from Solon's lips, was angered by the Athenian's reply. Solon proceeded to extol the virtues of otherwise "ordinary" men who lacked the trappings of wealth and power that Croesus so readily possessed. Seeing the king's dissatisfaction, Solon responded with words that would come to haunt not only Croesus but which would obsess the whole of Athenian society for decades to come: «μηδένα προ του τέλους μακάριζε». Solon's message was clear: Let me see your life's ending. Only then I can know if you lived a good and happy life. Only then I can know if you lived a life worth praising. Not long after Solon's visit, Croesus' kingdom was invaded and conquered by Cyrus the Great, ruler of the Persian Empire. Condemned to death, it is said that Croesus yelled out Solon's name three times from the flaming pyre atop which his body burned. It was not until that moment that he understood the message that Solon had so dutifully delivered. Croesus believed himself to be the happiest man, because of all the material wealth and power he had accumulated. But we cannot judge the happiness or the worth of a human life until it is over. A good life requires a good death, and learning how to live requires that we wrestle with our own mortality. The question of "what makes life worth living" therefore, was another way of asking: "what justifies life's suffering?" Unlike for the Christians who succeeded them, there was, for the Greeks, no easy answer. It's why they would congregate every spring in the amphitheater to laugh and cry and work out their grief over the pitiless predicament of human existence. 'Fairness' was as foreign a concept to the Greeks as fate is to us. The stories of Croesus, Minos, Oedipus, Agamemnon, and the like were not only reminders of how the fortunes of the fated turn; they were also evidence for the futility of relying on present circumstances for evaluating the merits of existence. It is no surprise, therefore, that this obsession with deriving meaning from one's own life independent of the whims of tempestuous Gods or of fated circumstance manifested itself in Greek philosophy. Its open-endedness posed an existential imperative then, as it does today. Producer & Host: Demetri Kofinas Editor & Engineer: Stylianos Nicolaou Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

In Episode 68 of Hidden Forces, Demetri Kofinas speaks with David Kotok, co-founder and CIO of Cumberland Advisors. David Kotok's articles and financial market commentaries have appeared in The New York Times, The Wall Street Journal, Barron's, and other publications. This is a fascinating conversation that spans a wide range of issues currently facing the global economy, as well as subjects and themes stretching as far back as 5th century Athens. Demetri asks David Kotok for his opinion on a series of topics including trade, the US Dollar, European monetary policy, as well as what markets he thinks are most at risk as the Fed continues down its path of tightening and as protectionist trade measures introduce new anomalies into the American economy. Kotok also shares his experience investing during the turbulent years of the 1970s and how the lessons he learned during that decade can be applied today. David also gives his outlook for credit markets, specifically the riskier areas of the corporate bond market that include leveraged loans and middle-market lending. Investors will find this conversation helpful, as they adjust their strategies to protect themselves against some of the non-linear impacts of government policies while still positioning themselves and their clients to profit from the rising tide of economic growth. Producer & Host: Demetri Kofinas Editor & Engineer: Stylianos Nicolaou Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

In this week's episode of Hidden Forces, Demetri Kofinas conducts an impromptu monologue after a last-minute rescheduling of his interview with a prominent, former US senator, governor, and member of the 9-11 commission. He reflects on some of the subjects he intended to cover with his guest, including the role of the Saudi government in the 9-11 attacks. He also spends a good amount of time exploring the spirit of the last 4 decades in America, as he considers what future generations will say about the new millennium. This is an unusual episode, in so far audiences get a look at Demetri's "headspace" before an interview, and how preparing for it causes him to reflect on subjects that concern all of us. Producer & Host: Demetri Kofinas Editor & Engineer: Stylianos Nicolaou Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

In Episode 67 of Hidden Forces, Demetri Kofinas speaks with Bill Janeway about capitalism in the innovation economy. Janeway is a senior advisor and managing director of Warburg Pincus, where he was responsible for building the investment firm's information technology investment practice. Bill is also a co-founder and member of the board of governors of the Institute for New Economic Thinking. In 1948, the same year in which Claude Shannon's revolutionary paper on information theory was first published in the Bell Labs Technical Journal, economist Paul Samuelson released what would become, the best-selling economics textbook of all time. Though no one can measure the creative impact of Shannon's ideas in shaping the next 70 years of innovation and progress in the information sciences, Samuelson's work is perhaps equally noteworthy for the destructive impact it had on three generations of capitalists, policy makers, and academics. The legacy of the neoclassical synthesis is one of economic theories built on models that borrowed recklessly from the physical sciences, canonized in the works of Samuelson's Economics. The failure of neoclassical economics with its dynamic stochastic equilibria and Gaussian-based models like VaR and MPT - peddling false promises of mean regression - have forced academia to rethink the entire edifice upon which our understanding of markets and the economy have been built. A new sort of political economy, driven by the disruptive forces of globalization, financialization, and the information revolution, have made ideological approaches to economic thinking obsolete. In this climate, what Bill Janeway calls "the mission-driven state," has been rendered illegitimate as an economic actor, disrupting the process of capitalism itself, as well as the credit cycle from which paradigm-shifting innovations are born. Still, ideas matter. The failure of modern macroeconomic models, to account for the Global Financial Crisis was a precondition for the type of creative destruction that we have seen applied to problems of markets and the economy in recent years. Developing a new framework for understanding the role of government, the power of markets, and the forces driving both is crucial if we hope to survive the changes of the 21st century. Producer & Host: Demetri Kofinas Editor & Engineer: Stylianos Nicolaou Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

In Episode 66 of Hidden Forces, Demetri Kofinas speaks with serial technology entrepreneur and host of the Internet History Podcast, as well as the Techmeme Ride Home, Brian McCullough. Brian is also the author of HOW THE INTERNET HAPPENED, published by Liveright, a subsidiary of W.W. Norton. In 2014 he was the co-founder of a startup human named Penelope, and in 2016 he launched Maxwell into beta. In March of 1989, CERN scientist Tim Berners-Lee wrote a proposal to develop a distributed information system for the laboratory. "Vague, but exciting," was the comment that his supervisor, Mike Sendall, wrote on the cover, and with those words, gave the green light to what would become the information revolution. Before the end of 1990, Berners-Lee would define the Web's basic concepts: the URL, http, and html, writing the first browser and server software. For the next two years the web would remain largely inaccessible to all but the most niche academics and hypertext enthusiasts. "…there was a definite element of not wanting to make it easier, of actually wanting to keep the riff raff out," recalled Marc Andreessen, founder of Netscape. His own big idea in the winter of 1992 was the let the riff-raff in. That opening came in the form of the Mosaic browser, which brought with it two key implementations: the support for images, and, more importantly, compatibility with Microsoft Windows, which at the time accounted for more than 80 percent of the world's operating systems. Shortly after Mosaic launched in January of 1993, the number of websites in existence could be measured in the hundreds. By the end of 1994, that number had surpassed tens of thousands, and Mosaic was adding as many as 600,000 new users every month. Berners-Lee may have been responsible for creating the web, but it was Marc Andreessen and his team of misfits and geeks at The University of Illinois at Urbana-Champaign, surrounded by empty pizza boxes and soda cans, that took the web mainstream.= Andreessen and his team eventually left Mosaic behind to found Netscape, taking it public in August of 1995, kicking off a 5 year mania of creative energy and enthusiasm that would see the creation of the first search engines, e-commerce platforms, and weblogs. More than seventeen million new websites were created before the end of the 20th century. In five short years, the Internet craze kicked off by the commercialization of the browser culminated in the bursting of the most spectacular stock market bubble seen since 1929. That story – one predicated on a revolutionary technology and enabled by the dreams, ambitions, and avarice of a generation unrestrained by the prudence of their parents and untouched by the failures of the past – is a history that, until this day, has remained largely untold. This week, on Hidden Forces, Brian McCullough joins us for a conversation on, search engines, e-commerce, web portals, social networks, and the history of the information revolution. Producer & Host: Demetri Kofinas Editor & Engineer: Stylianos Nicolaou Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

In Episode 65 of Hidden Forces, Demetri Kofinas speaks with China expert Dinny McMahon, who spent ten years as a financial journalist in China, including six years in Beijing at The Wall Street Journal and four years with Dow Jones Newswires in Shanghai. Demetri and Dinny discuss how Chinese malinvestment, massive debt burdens, and a population that is aging faster than anywhere else in the world has created the conditions for the worst economic and political crisis in modern history. It has often been argued that the Chinese economic model may offer the best prototype for how humans should organize politically, in the 21st century. For Westerners, it's difficult to appreciate the scope of China's development, and this is because of the way in which the country allocates capital and generates credit. Unlike western economies, which are built around liberal, democratic norms of free-market capitalism, China's economy operates more like a one-billion person, multinational conglomerate. This model has allowed the Chinese economy to grow rapidly; it has done this by leveraging massive amounts of capital that it reinvests into real estate projects and spare industrial capacity, with the expectation of ever-increasing economic growth. This leverage can be witnessed, most clearly, in the rapid growth of the country's private and public debt. Bank liabilities in China have grown at an astonishing rate over the last twenty-five years. From 2009 to 2011 alone, assets in China's banking system have expanded by 77 percent - a total of 7.6 trillion dollars over just a three-year period. The impact of China's loan growth can be seen in the sky rocking prices of Chinese real estate, the overcapacity of Chinese factories, and the pollution of China's once pristine environment. Cognizant of these excesses, Chinese officials have been trying to reform the country, by reigning in investment and stemming corruption. But even the best efforts of Chinese authorities cannot fix the country's broken demographics. China's population is aging faster than anywhere else in the world. In 2015, the country had seven and a half working-age adults to support every senior citizen. In fifteen years, that ratio will drop to 4:1 and by 2050, there will be only two adults to support every man and woman in retirement. It is the fear of Chinese officials that the country will grow old before it grows rich, falling victim to the so-called middle-income trap, mired in debt and saddled with decades of malinvestment, air pollution, idle factories, and broken promises. Producer & Host: Demetri Kofinas Editor & Engineer: Stylianos Nicolaou Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod

In Episode 64 of Hidden Forces, Demetri Kofinas speaks with mathematician and public educator, Hannah Fry. Dr. Fry's mathematical expertise has led to the development of several documentaries on the BBC, where she also hosts her own, long-running Radio 4 program: The Curious Cases of Rutherford and Fry. Already a two-time author, Hannah is out with her third and latest book, Hello World: Being Human in the Age of Algorithms. Since the turn of the twentieth century, algorithms have assumed the power previously associated with pontiffs or the divine right of kings. In an instance of late 20th century lore, the great Chess Champion Garry Kasparov, reflecting upon his historic loss to IBM's Deep Blue described the algorithm that defeated him in less than twenty moves, as having 'suddenly played like a God for one moment'. Kasparov's experience – that of having been unnerved by the intelligence and obstinate posture of an otherwise lifeless machine – has not remained confined to the narrow dimensions of his chess board. In the 20 years since his loss, increasingly intelligent algorithms seem to be overtaking our world and making humanity obsolete in the process. But in the age of the algorithm, there are those like Hannah Fry, who believe that our place has never been more important. She believes that we should stop seeing machines as objective masters. Instead, we need to start treating algorithms as we would any other source of power; questioning their decisions, scrutinizing their motives, and holding them accountable for their mistakes. As computer algorithms increasingly control and decide our future, 'Hello World' is a reminder of a moment of dialogue between human and machine. Of an instant where the boundary between controller and controlled is virtually imperceptible. It marks the start of a partnership – a shared journey of possibilities, where one cannot exist without the other. In the age of the algorithm, that's a sentiment worth bearing in mind. Producer & Host: Demetri Kofinas Editor & Engineer: Stylianos Nicolaou Join the conversation on Facebook, Instagram, and Twitter at @hiddenforcespod