- The backstory about Uber’s self-driving car you won’t see elsewhere
- A CEO’s ultimate revenge on bureaucrats, and consumers are the winners
- Our science-and-wealth team bears witness to “the future of cars”
- Seeing through the Fed’s pathetic mind games
- Is medicine finally on the verge of treating causes and not symptoms?
- The 5 accused of being in the tank for a major presidential candidate!
Once in a rare while, government regulations have the effect of stimulating innovation — even if that’s the last thing the regulators intend.
That’s the real story behind the big “water cooler” news story today — that Uber is days away from rolling out a fleet of self-driving cars in Pittsburgh.
Sometime today, Uber and Volvo will make public a $300 million deal to trick out Volvo’s XC90 SUV with experimental “autonomous” technology.
At the start, humans will still be in the driver’s seat — professional engineers, as a matter of fact. But the plan is to build out the technology with the help of robotics researchers at Pittsburgh’s Carnegie Mellon University… to a point that humans will no longer be necessary.
Coming soon to the Steel City…
And to think the whole thing started when Uber management appeared to get fed up with one too many bureaucratic busybodies.
We first described Uber’s disruptive business model in our virtual pages nearly four years ago. Using a smartphone app, you can summon a driver — often using his or her own vehicle — and get a lift to wherever you needed to go. No more trying to hail or call a taxi… and a darn sight cheaper, too.
Naturally, the taxi industry saw this as a threat. In most major cities, government long ago put strict limits on new entrants into the taxi trade. It was a sweet deal for existing players who got grandfathered into the scheme.
So along came this newfangled arrangement that flummoxed the old-school regulators. Talk about “disruptive.” Was it really a taxi service or not? Some regulators decided it was — applying old-style rules to Uber, if not banning it entirely.
Uber’s approach all along has been to follow the old saw about how it’s easier to beg for forgiveness than ask for permission.
And so it went when Uber entered Pennsylvania in early 2014. The state’s Public Utility Commission, however, was none too forgiving. The PUC issued a cease-and-desist order on July 1. Uber defied that order for several months before throwing in the towel and obtaining an “experimental license.”
Fast-forward to April of this year and the PUC fined Uber $11.4 million — a figure six times the agency’s previous record fine, issued to an electric power company. Uber is appealing.
It was around the time Uber started going through the motions of that “experimental license” in late 2014 that Uber CEO Travis Kalanick flew to Pittsburgh to recruit those robotics geniuses at Carnegie Mellon.
When you think about it, self-driving cars are the next logical step in Uber’s evolution. The company already bent the cost curve of getting a ride. Why not bend it further by replacing its 1 million human drivers with robots?
Less than two years later, the first semiautonomous XC90s hit the streets of Pittsburgh before the end of this month.
Too soon? Not at all. “We are going commercial,” he tells Bloomberg Businessweek. “This can’t just be about science.”
The heads of the regulators who were trying to protect the taxi operators must be spinning at warp speed by now…
Of course, Uber isn’t the only outfit at work on driverless tech.
As it happens, editor Ray Blanco and publisher Aaron Gentzler of our science-and-wealth team are in Silicon Valley this week. They’ve seen it firsthand.
“On Monday night in Mountain View — home to Google headquarters — I saw three driverless cars, with people in them, driving down the road,” says Aaron.
“There are no instruments on the inside. You couldn’t ‘take the car over’ if you had to. Light turns green, car just starts going… and the two guys in the car are chatting away.”
And that’s only part of the story. “Driving around Cupertino and Mountain View, you see so many Teslas… electric vehicle charging stations… and, yes, driverless cars… the trend jumps up and slaps you in the face.
“The future of cars is electric and driverless. This isn’t theory anymore. This is happening.”
[Ed. note: Aaron passes along another discovery from the trip: “I met a research scientist for a household-name company (NOT a tech company) that last year set up an ‘incubator’ office in Silicon Valley to figure out how to integrate virtual reality and augmented reality into their business.
“If you knew the name of the company, which I can’t disclose, you’d scratch your head. But they’re spending serious money figuring out how to use AR right now.”
We keep saying it’s still early days for investing in VR and AR. But it won’t be much longer. Not at this pace. The elevator’s open… but it’s getting more crowded. If you want to get in, best move on it now. Here’s where to begin.]
Whatever credibility the Federal Reserve still had has gone poof after the release of the “minutes” from its meeting three weeks ago.
At the risk of repeating ourselves, Fed minutes are unlike the minutes from your local sewer board meeting. They’re not an objective record of who said what. They’re a carefully crafted document designed to elicit a media and market reaction.
As noted here yesterday, the Fed wants to keep up the pretense that it might raise interest rates before year-end. It hopes to keep a lid on a stock market that’s looking a little giddy.
And so one media outlet after another deduced from the July minutes, released yesterday afternoon, that members of the Fed’s Open Market Committee were “deeply split.”
Huh? What split? The vote to leave rates alone last month was 9-1. That was announced at the conclusion of the meeting.
And what of the rest of the year? “Members judged it appropriate,” said the minutes, “to continue to leave their policy options open and maintain the flexibility to adjust the stance of policy based on incoming information.” In other words, they’re still flying by the seat of their pants.
Whatever. Inflation is still too low by the Fed’s own standards to justify a move before the election.
The minutes induced a yawn from the junior traders on duty this week while their bosses are in the Hamptons.
The major U.S. stock indexes are still a hair below record territory. Bond yields have backed down a bit, the 10-year Treasury at 1.55%. Gold perked up slightly and sits at $1,350.
We got another so-far-in-August economic indicator this morning — mid-Atlantic manufacturing. It’s still treading water, according to the latest Philadelphia Fed survey — neither growing nor shrinking appreciably.
“The way we view treating disease needs to change,” says the aforementioned Ray Blanco, with more reflections from his time in northern California this week.
In addition to various Silicon Valley destinations, Ray and Aaron also attended the SENS Research Foundation Rejuvenation Biotechnology Conference, hosted by the Buck Institute for Research and Aging.
“Much of our medical technology is designed to treat specific diseases, such as cardiovascular disease and cancer,” Ray tells us. “These chronic conditions are the result of the aging process… not the cause. It makes more sense to attack the causes.”
The human body might not be a machine… but like machines, they wear out over time, says Ray. “If we can engineer a good maintenance program, these biological machines could be helped to run properly for much longer — much like a well-maintained car can be made to run far longer than its original design allows.
“This might involve removing worn-out parts, such as senescent cells. It would involve installing new parts, such lab-cultivated stem cells. Existing cells could be rejuvenated by clearing out accumulated ‘gunk’ in the form of intracellular and extracellular misfolded proteins.
“Some of what’s still too early-stage for us to act on today someday will be. As new therapies spin off into for-profit biotech companies in the near future, we’ll find actionable ways to benefit.
“We’ll benefit with longer lives and better health. We’ll also earn outsized returns from the profits these new therapies will create.”
“The reader who claims the 16th Amendment was the first unconstitutional Amendment is 100% correct,” begins today’s mailbag. “Furthermore, the 17th Amendment was the second unconstitutional amendment. The others are legitimate.
“It requires ratification by 75% of the states to amend the Constitution, which at that time meant that 36 states MUST sign. I defy anyone in the world to show that number of signatures for those two amendments. Each one is short one or two state signatures. You will not find 36 signatures in the Library of Congress or anyplace else. The public was simply told that it had passed, but not one person bothered to verify the results. Since 1913, the United States has worked diligently at becoming the most corrupt government in the world, and they have succeeded.
“If this country can produce the original Declaration of Independence, the Constitution and copies of all necessary ratification signatures for all of the other amendments, then why can’t it find 36 signatures? The answer is simple — they DO NOT EXIST!!!”
“Can’t keep quiet on this one, no buts about it,” chimes in another reader who objects to “the same old gobbledygook about the beauty of being able to change the Constitution. I’m puking.
“The Constitution is a charter of negative liberties imposed on government to shackle the government’s actions against the people. Think about it. Please reread it, and note what the 10th says.
“Sure, the ratification of the 16th was done legally by the book in the dead of night. Wink, wink. The 16th Amendment is unconstitutional not because of the process or what it says, but because of what it is. It’s unbridled power. It has no limitations on government whatsoever. They can take whatever sum of money they want anytime they want. Where are the shackles in that?
“Quick example: There was a time when government wanted to wage war, they had to come to you with hat in hand selling war bonds. They don’t need to do that anymore, do they? They just reach into the bank accounts of the unborn and take what they want. How’s that for ultimate power? They can reach out across time itself and steal at will. Time bandits!”
The 5: We daresay all this is so much angels dancing on the head of a pin.
Your editor is midway through a new book by the libertarian firebrand Sheldon Richman called America’s Counter-Revolution: The Constitution Revisited.
Richman makes a compelling and well-documented case that the Constitution was never intended to limit federal power.
It wasn’t later generations that glommed onto vague phrases like “general welfare” and “necessary and proper” to expand government power: Hamilton and his fellow crony capitalists planned it that way from the get-go. They sought explicitly to recreate the mercantilist British system, minus the king. They succeeded. The great American experiment was strangled in its crib.
It’s a short book. It will quickly disabuse you of any misty-eyed reverence for “the Framers.”
“Have you ever considered half of your readers are Democrats?” writes our final correspondent.
“Why are you keep pushing Trump as future president? If you do not stop the political campaign for Trump, I will cancel my membership.”
The 5: Huh?
Near as we can tell, the reader wrote in after we sent a sales message earlier this week that said Mrs. Clinton, and her fellow former and current members of Congress, are getting away with a thing or two. And that you could do likewise.
Or perhaps he’s objecting to the ad that sometimes runs midissue that says an event now only 43 days away might sink her presidential hopes.
Anyway, we have no idea what percentage of our readership belongs to which party, or none at all.
Our own editorial stance — and it should be evident to anyone who reads with discernment for any stretch of time — is strictly “anti-partisan.” We have zero confidence in anybody to get it right; the mere fact they seek public office and the exercise of power disqualifies them.
Oh, the ad that says the events of Sept. 30 could sink Mrs. Clinton’s presidential hopes? There’s another version that says it could sink Trump’s hopes too. Heh…
The 5 Min. Forecast
P.S. In every presidential election going back the last 40 years, there’s been a group of insiders that have applied a technique to deliver repeated triple-digit gains in a matter of weeks.
And because so many people believe this election is “the most important of their lifetime”… the potential gains might be even bigger than in past election cycles.
Our own David Stockman has observed this technique firsthand… from his perches both as White House budget chief and Wall Street wheeler-dealer.
Wouldn’t you like to learn about this technique for yourself? Watch this space tomorrow for details…