September 29, 2016

UPS is attempting to catch up in the drone wars:

UPS, despite its decades of delivery experience, is a latecomer to the drone delivery game. Drone startup Flirtey demonstrated a ship-to-shore drone delivery of medical supplies off the coast of New Jersey earlier this summer, and drone delivery company Zipline declared its intent to delivery needed blood to rural populations in Washington State’s San Juan islands.

And it’s not just startups that are already doing delivery. Amazon’s drone program is perhaps the most famous, but Europe’s own DHL delivery giant experimented with drones in difficult mountain terrain. Chinese online retailer JD.com is also exploring drone delivery in marshy and channel-crossed provinces, where flying drones can fly easily over the car-impassible waterways. That UPS is experimenting with drone technology is more a testament to the technology’s broad appeal than any particular innovation by the company itself.

On a related note, Tyler Cowen of Bloomberg claims that technology favours suburbia:

Self-driving vehicles are also likely to help the suburbs most. One of the worst things about the suburbs is the commute to the city or to other parts of the suburbs. But what if you could read, text or watch TV – safely — during that commuting time? What if you could tackle your day’s work just as you do on a train or plane? Commuting would seem a lot less painful. As driverless vehicles evolve to accommodate work and leisure uses of the automobile space, pleasure will replace commuting stress.

What about drones? They too would seem to favor remote areas where it is harder to access useful goods and services. Drones may do more for exurbs and rural areas than for the suburbs, but it seems cities will gain least. Walking or biking to nearby shops is a potential substitute for drone delivery. Rolling sidewalk drones might find it harder to negotiate crowded cities, and cities with a dense network of tall buildings may be less friendly to flying drones. Population density may increase the risk of a drone falling on someone.

Jared Dillian writes in Forbes about the message we’re sending to the Chinese:

Shockwaves reverberated through Canada last week as the government announced that negotiations would commence on an extradition treaty between Canada and China.

Make no mistake about it–from Canada’s perspective, this has everything to do with money laundering–and the torrid housing market. In fact, supporters of the extradition treaty directly cite the inability of middle class Canadian families to buy homes that have become prohibitively expensive, due to foreign capital pouring into the country.

But Canada should really reflect on whether they want a reversal of those capital flows. History has not been kind to countries that have slammed the door shut on foreign investment. And money always goes to where it is treated best. So if Canada becomes hostile to Chinese money, it will find somewhere else to go. And I’m sure lots of countries would be happy to take it.

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Issues Day’s Perf. Index Value
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SplitShare 5.05 % 4.67 % 75,682 2.15 5 0.1749 % 3,460.2
Interest-Bearing 0.00 % 0.00 % 0 0.00 0 0.1749 % 2,699.8
Perpetual-Premium 5.50 % 4.63 % 64,580 1.94 12 -0.0781 % 2,688.1
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FixedReset 4.96 % 4.25 % 148,773 6.98 92 0.1850 % 2,052.8
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FloatingReset 2.84 % 4.40 % 32,262 4.97 12 0.1226 % 2,202.4
Performance Highlights
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ELF.PR.G Perpetual-Discount -1.82 % YTW SCENARIO
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Evaluated at bid price : 22.68
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TRP.PR.F FloatingReset -1.20 % YTW SCENARIO
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PWF.PR.T FixedReset 1.03 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2046-09-29
Maturity Price : 19.59
Evaluated at bid price : 19.59
Bid-YTW : 4.02 %
BAM.PF.G FixedReset 1.04 % YTW SCENARIO
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Maturity Date : 2046-09-29
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BAM.PR.R FixedReset 1.08 % YTW SCENARIO
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TRP.PR.C FixedReset 1.13 % YTW SCENARIO
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BAM.PF.A FixedReset 1.32 % YTW SCENARIO
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BAM.PF.B FixedReset 1.61 % YTW SCENARIO
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Evaluated at bid price : 17.72
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CU.PR.C FixedReset 1.69 % YTW SCENARIO
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Maturity Date : 2046-09-29
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MFC.PR.F FixedReset 2.15 % YTW SCENARIO
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BMO.PR.L Deemed-Retractible 69,657 YTW SCENARIO
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YTW SCENARIO
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7 Responses to “September 29, 2016”

  1. externality says:

    Who’s paying for all the extra infrastructure required to service widely dispersed robot car commuters while they are relaxing in their robot car?

    If the city folk walking to work need nothing but a few square feet of sidewalk for a maybe 30 minutes a day and the robot car folk need tens of billions for massive freeways specially mapped and instrumented, the result, as we have seen with non-robot cars over the last 80 years, will be the people walking massively subsidizing the people in the robot cars.

    As an exercise, imagine what sort of settlement and transportation we would choose if we allowed the land currently used for streets, roads, highways, freeways, and parking lots to be priced like other land. What are the odds that a private landowner would feel the highest and best use of his plot would be to let car commuters (robot or otherwise) traverse it for free while he picked up the repairs, maintenance and operations?

  2. BarleyandHops says:

    Many moons ago, I was shopping for a house in West Vancouver. What was a bit eye lifting was a good number of homes with grandparents and kids, and no middle generation present. The parents bought houses and placed their kids in schools and the grandparents were there to cook and watch over.

    As new permanent residents much was saved on schooling and healthcare. This is not revenue neutral and quite the opposite. Having found and purchased a house, my neighbor was a resident of Hong Kong (paying flat tax) And, his parents had free health care and the kids, as permanent residents had great schools to go to (sans foreign students fees).

    I think this draw will outweigh any foreign investors from shying away from the market for houses in Vancouver. A move to the US is completely different.

  3. malcolmm says:

    Leaving the kids in Vancouver and having the parent(s) stay in Hong Kong to earn a living and pay taxes is unfortunately nothing new.

    I graduated from high school in 1975 a several of my classmates had parents in Hong Kong.

    I would like to see an up to date study on how much this sort of situation costs Canada. I’m not really blaming the people who do it, it isn’t against the law. But these people don’t need our help so if it isn’t financially advantageous for Canada, we shouldn’t allow it.

    Also, those grandparents probably came over after their working career was over. They never paid taxes in Canada to support our welfare state but they take full advantage of it.

  4. jiHymas says:

    As an exercise, imagine what sort of settlement and transportation we would choose if we allowed the land currently used for streets, roads, highways, freeways, and parking lots to be priced like other land.

    We probably wouldn’t need any settlement or transportation at all, since we’d all be dead. At its most basic, transportation infrastructure allows food to come into the city; more generally, trade is facilitated.

    Since time immemorial, one of the primary functions of government has been to facilitate trade.

    Mind you, I have no intrinsic objection to tolls. If autonomous cars require “specially mapped and instrumented” highways – I’ve seen no indication of this in what I’ve read – then by all means charge a toll.

  5. jiHymas says:

    And, his parents had free health care and the kids, as permanent residents had great schools to go to (sans foreign students fees).

    I suspect this amount is trivial in the context of the entire system, but I haven’t seen any figures.

    In Ontario, primary and secondary education is paid for out of property tax, so there’s no free ride there. There will be a free ride with respect to medical care and other income-tax-funded activities; but this to me simply indicates that property taxes should be increased along with consumption taxes such as the GST.

    Against the free ride on certain government services, there are offsets. For instance, if all the money spent in Canada is being sent from off-shore, this is effectively an export by Canada of the goods and services the family consumes. If they’re rich enough to maintain (at least) two residences, I’ll suggest that this consumption is probably large relative to normal standards.

    There’s also the marketing effect: I suggest that it is a Very Good Thing Indeed for rich kids to be educated in Canada. They won’t be kids forever and, economic mobility being what it is, they will probably be rich and influential when they grow up. The more that such people know about Canada, the better, as far as I’m concerned.

  6. stusclues says:

    “Who’s paying for all the extra infrastructure required to service widely dispersed robot car commuters while they are relaxing in their robot car?”

    One of the main attractions of “robot cars” or autonomous vehicles is precisely the opposite. AI-vehicles that are in constant communication with each other and the infrastructure around them will need only a fraction of the infrastructure associated with human-driven (accident-prone!) vehicles. The driverless-Uber (now on the roads in Pittsburgh and Singapore) will eliminate the economic hardship of vehicle ownership for millions of people and reduce the vehicles on the road by as much as 90% (not my estimate).

    So I suggest that governments will be able to much more easily provide the services mentioned by James while also allowing society to reclaim much land for higher and better purposes as proposed by externality. Bring it on!

  7. BarleyandHops says:

    There’s also the marketing effect: Yes you have a point

    AI-vehicles that are in constant communication with each other and the infrastructure around them will need only a fraction of the infrastructure associated with human-driven

    So we will have less taxes and pot holes.

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