Start Up No.1755: why Facebook’s Diem died, the war-prepped Finns, shrinkflation!, end of the 27in iMac, spamming Russia, and more


in Russia, 44 chess grandmasters have written to Vladimir Putin calling for peace in Ukraine. But does their action count as defiance? CC-licensed photo by Andreas Kontokanis on Flickr.

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A selection of 10 links for you. Use them wisely. I’m @charlesarthur on Twitter. Observations and links welcome.


Facebook Libra: the inside story of how the company’s cryptocurrency dream died • Financial Times

Hannah Murphy and Kiran Stacey:

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Under [former US Treasury official Stuart] Levey’s direction, Diem shrank. To placate European and US regulators, the project’s scope was narrowed to the creation of a digital currency backed one-for-one by the dollar rather than a basket of currencies and other low-risk assets, which some were concerned might challenge the dominance of the dollar. A team of crypto engineers spanning Europe and Silicon Valley worked feverishly to build a system to monitor transactions for signs of money laundering or sanction breaking. They also came up with ways to prohibit anonymous transactions and vet the outfits that could build services to support Diem currency.

…[by spring 2021] Levey and the rest of the senior team, including [Diem originator David] Marcus, felt confident enough to test issuing a small amount of Diem currency as well as trialling a version of the Novi digital wallet. The test would be available to a small group of users, but the team was jubilant at the prospect, according to several people involved at the time.

Reaching the major milestone required the Swiss Financial Market Supervisory Authority, Finma, to approve Diem’s licence. The application papers were on the regulatory agency’s desk, and Finma had convened a college of more than 20 regulatory watchdogs from around the world to guide it through the process. It just needed the final green light from the US Treasury.

It was at this point that the Treasury issued its first devastating “No”. Officials told Finma and Diem that they were requesting a temporary delay of the pilot. The Biden administration was still settling in, they said, and needed time to review the project. Levey was indignant, convinced that these were not substantive concerns.

…In a testy phone call, the [US Federal Reserve’s] general counsel Mark Van Der Weide told Levey that the government was uncomfortable condoning any project until it had put a “comprehensive regulatory framework” for stablecoins in place, and he expressed nervousness about a coin with the potential to “massively scale” as Diem might.

According to Diem staffers, something seemed off about Van Der Weide’s delivery during the call. He was stiff, almost robotic. When they compared notes with colleagues at Silvergate, they found that a call they’d received from Van Der Weide had played out in a suspiciously similar way. They concluded that the official must have been reading from a script; both groups felt slighted. The Fed and the Treasury both declined to comment. “It was a last-minute rug-pulling exercise, the night before the proposed launch date,” says one person who was involved.

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Fabulously ironic, given all that goes on with cryptocoins, that the rugpull should come from the government. Diem’s dead. (David Gerard has written a book – Libra Shrugged – about it all.)
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How the Finns deter Russian invasion • The Atlantic

Graeme Wood:

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Russia’s invasion of Ukraine has been a strategic failure because it assumed and required a quick and decisive victory, and at best it will get victory slow and Pyrrhic. But the Ukrainians have failed badly as well, by waiting too long to arm and train their citizens. If you want ordinary people to make your society occupation-proof, you have to teach them to kill well before they need to do so.

The strategist Edward N. Luttwak has proposed that countries aligned with NATO shift in this direction preemptively, as a matter of policy. Instead of buying heavy, technologically advanced equipment, Luttwak told me, they should adopt the Finnish model. In Finland, adolescent males report for a short and intense period of military training, followed by shorter refreshers for most of their adult life. The training is not, as in the Israeli model, a few years of dedicated service. Nor does it emphasize military discipline, such as keeping one’s bunk tidy and shoes polished, or the Prussian-style transformation of citizen-recruit into fighting machine. Instead, it prepares civilians to be ready to join their unit and harass and kill invaders. A country of Finland’s size can rapidly field nearly 1 million trained soldiers. “Ukraine could have done this,” Luttwak said, “and they should have.”

The Finno-Soviet Winter War of 1939 ended with Soviet withdrawal, and Luttwak said it should now be a deterrent model for other countries, including Poland and the Baltic nations. “Do not try to stop the invasion,” Luttwak said. “Wait for them to enter your country. Once the tank stops rolling forward, let the soldiers come out to cook or to pee, and then kill them.” Finland suffered during the invasion and conceded territory in the peace treaty that ended the war three months later. But the Soviets lost about seven times as many men, and when they withdrew, they knew that occupying Finland again would mean frostbite, fear, and the chance of getting shot dead in the snow with your pants down.

A Finnish defense official I spoke with stressed that the Finnish model incorporates a technologically advanced professional military and would not work without it. But a territorial-defence reserve can deter occupation in the first place—particularly if it has training and enjoys the logistical support of other countries.

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Sounds like planning to run an insurgency; which is of course always going to favour the invaded over the invader. But it’s the model – prepare early – that really needs to be considered. Israel, Finland – which other countries have trained civilians? (The US definitely doesn’t count.)
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Inflation and supply chain snags are causing “shrinkflation” for food products • Quartz

Clarisa Diaz:

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Shoppers tend to be price-sensitive but they may not notice subtle changes in packaging, or read the fine print on the size or weight of a product. The result is that consumers are less likely to notice getting less if the price is the same [aka “shrinkflation”].

“Downsizing comes in waves, and it tends to happen during times of increased inflation,” said Edgar Dworsky, a consumer rights lawyer that keeps track of downsized products on consumerworld.org. “Bottom lines are being pinched and there’s three basic options: raise the price directly, take a little bit out of the product, or reformulate the product with cheaper ingredients.”

…Frito-Lay confirmed Doritos shrunk their bags due to pandemic pressures. “Inflation is hitting everyone…we took just a little bit out of the bag so we can give you the same price and you can keep enjoying your chips,” said a representative. Representatives at Proctor & Gamble which makes Crest toothpaste, and at Mondelez—which makes Nabisco Wheat Thins, confirmed reductions in their products’ volumes but did not disclose the reasons why. While Crest 3D White does now sell a 5oz tube, its 4.1oz tube shrank to 3.8oz. Bounty, according to a representative at Proctor & Gamble, got better as it got smaller since the paper towels are more absorbent than they used to be.

Gatorade—the sports drink brand of PepsiCo—recently replaced its 32 oz size with a 28 oz bottle for the same price. That’s the equivalent of a 14% price increase.

“Basically we redesigned the bottle, it’s more aerodynamic and it’s easier to grab,” said a company representative. “The redesign generates a new cost and the bottles are a little bit more expensive…this is only a matter of design.”

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More aerodynamic? Why exactly does a soft drink bottle need to be aerodynamic?
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Red letter day: how Russian chess defied Putin • TheArticle

British chess grandmaster Raymond Keene:

»

To my astonishment, not to mention extreme admiration, forty-four of Russia’s leading chess Grandmasters, including last year’s world title challenger Ian Nepomniachtchi and the top female player Alexandra Kosteniuk (pictured above), have written an open letter to President Putin denouncing his war against Ukraine. These bold paragons of the chess community are thereby risking not just their personal freedom, but their lives.

«

Sounds amazing, right? But I’m not sure about his interpretation. Here’s the text of the letter, in the translation he provides:

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“We believe that chess, like sports in general, should bring people together. The most difficult and prestigious international tournaments were held in our country at the highest level even in the midst of a pandemic.

“Chess teaches responsibility for one’s actions; every step counts, and a mistake can lead to a fatal point of no return. And if this has always been about sports, now people’s lives, basic rights and freedoms, human dignity, the present and future of our countries are at stake.

“In these tragic days, we think of all the people who found themselves in the centre of this terrible conflict. We share the pain with our Ukrainian colleagues and call for peace.”

«

I don’t see any denunciation of the war there, to be honest. You could, if you made an effort, view it as support for Putin’s action. (The Ukrainians should have thought through what dallying with the West/democracy/Nato/electing a president who isn’t a glove puppet would cause, etc etc.) Though Keene does go on to suggest that chess allowed people in Soviet Russia the ability to think for themselves – at least on the chessboard. (His regular readers agree with him, judging by a polling system at the end of the article.)
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Russians liquidating crypto in the UAE to seek safe havens • Reuters via Financial Post

Yousef Saba, Lisa Barrington, Riham Alkousaa and Alexander Cornwell:

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Crypto firms in the United Arab Emirates (UAE) are being deluged with requests to liquidate billions of dollars of virtual currency as Russians seek a safe haven for their fortunes, company executives and financial sources said.

Some clients are using cryptocurrency to invest in real estate in the UAE, while others want to use firms there to turn their virtual money into hard currency and stash it elsewhere, the sources said

One crypto firm has received lots of queries in the past ten days from Swiss brokers asking to liquidate billions of dollars of bitcoin because their clients are afraid Switzerland will freeze their assets, one executive said, adding that none of the requests had been for less than $2bn.

“We’ve had like five or six in the past two weeks. None of them have come off yet – they’ve sort of fallen over at the last minute, which is not rare – but we’ve never had this much interest,” the executive said, adding that his firm normally receives an inquiry for a large transaction once a month.

“We have one guy – I don’t know who he is, but he came through a broker – and they’re like, ‘we want to sell 125,000 bitcoin’. And I’m like, ‘what? That’s $6 billion guys’. And they’re like, ‘yeah, we’re going to send it to a company in Australia’,” the executive said.

Dubai, the Gulf’s financial and business center and a growing crypto hub, has long been a magnet for the world’s ultra-rich and the UAE’s refusal to take sides between Western allies and Moscow has signaled to Russians that their money is safe there.

«

Just to repeat that line: none of the requests had been for less than $2bn. Multiple requests to liquidate billions into actual usable currency. I’m doubtful that there’s anything like that sort of liquidity in the bitcoin system. Selling a few hundred bitcoin in one go can make the market slump. Selling thousands? Not sure it’ll happen.
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Vaccines and Omicron mean Covid now less deadly than flu in England • Financial Times

John Burn-Murdoch and Oliver Barnes:

»

A combination of high levels of immunity and the reduced severity of the Omicron variant has rendered Covid-19 less lethal than influenza for the vast majority of people in England, according to a Financial Times analysis of official data.

But the speed with which Omicron infects people still pushed the total number of deaths this winter whose underlying cause was a main respiratory disease to 9,641 since the first week of January, 50% higher than in a typical flu season despite lower levels of social mixing, the Office for National Statistics figures revealed.

The high degree of immune protection from vaccination and previous infection among England’s population formed the basis of the government’s decisions to end legally enforced self-isolation last month and scale back free testing from April 1 as part of its “living with Covid” plan.

However, experts said a recent increase in hospital admissions — possibly driven by decreased behavioural caution after the dropping of restrictions or protection from the booster waning for older age groups — highlighted the risk of the government’s strategy.

“Is Omicron the same as flu? No. But the vaccines have made the risks to the individual very similar,” said Dr Raghib Ali, senior clinical research associate in epidemiology at Cambridge university…

«

But you won’t read THAT in the mainstream.. oh hang on.
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What Google Search isn’t showing you • The New Yorker

Kyle Chayka:

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[The Google search results page, with its] cluttered onslaught of homogenous e-commerce options is what recently prompted Dmitri Brereton, a 26-year-old engineer at a recruiting-software company in San Francisco, to publish a blog post titled “Google Search Is Dying”. When it comes to product reviews or recipes, Brereton argued, results from Google’s search engine “have gone to shit.”

Rather than settling for the default, those who want to know what a “genuine real-life human being” thinks of a certain product have learned work-arounds, such as adding “Reddit” to their searches to bring up relevant threads on that platform. On Reddit’s “Buy It for Life” forum, for instance, they’ll find users showing off a Soviet-era toaster, a restored vintage Sunbeam, and other toasters to “grow old with,” as one put it. Brereton’s post–which ended “Google is dead. Long live Google + ‘site:reddit.com’ ”—became the No. 10 most upvoted link ever on the tech-industry discussion board Hacker News. No. 11 is a complaint about Google’s search results looking too similar to its ads, while No. 12 is a link to an alternative, indie search engine. Clearly, others share Brereton’s sense of search-engine discontentment.

Brereton told me recently that his frustration began in late 2020. “I was browsing the Internet one day, and I began to feel like something was just off,” he said. “A lot of the content doesn’t feel authentic—it doesn’t feel real.” He sounded bemused by the runaway popularity of his post, which was part of a personal research project on how information is organized online. Better information could be found on social media, discussion boards, and small-scale personal blogs, but Google Search was deprioritizing those platforms in favor of corporate Web sites, which could afford the money and effort it takes to optimize for Google’s search algorithm. “The authentic Web” seemed hidden, Brereton said. “The algorithms tell us what to read.”

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It’s a good article pulling together mentions of a number of other search engines (which have been mentioned here before). I linked to Brereton’s post (he was just “dkb”) when it came out, of course.
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Obituary: Mary Coombs, first woman commercial programmer, dies at 93 • The Register

Thomas Claburn:

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In her oral history, Coombs described the planning process prior to writing code, which hasn’t changed all that much over time.

“Well, once you’ve got a specification in detail which has been agreed, you then have to draw flowcharts to show how this would be done on the computer, with boxes and arrows and… and every place where you need to make a decision,” she said. “…The flowcharts tended to get more complicated as time went on because the programs tended to become more complicated.”

In 1954, J. Lyons & Co. commercialized [the room-sized first commercial computer] LEO under the name Leo Computer Ltd in order to offer it for sale to other companies. In her oral history, she describes the challenge of debugging the room-sized LEO.

“I can remember one particularly long evening when it kept going wrong and we were there all evening, because you had to have a programmer involved in this, the engineers couldn’t do it on their own,” she recalled. “And we eventually discovered that the management lift which went up to the fifth floor where the boardroom etc, was, was interfering.

“But it took an awful long time to work this out, because somebody had to think of it as a possible explanation when all else had failed. Because obviously if the lift wasn’t working, it would have been an intermittent sort of fault. So it was quite, quite difficult.”

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A bug as abstruse in its way as adjustable office chairs making displays flicker.
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Ukraine: Spam website set up to reach millions of Russians • BBC News

Joe Tidy:

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A Norwegian computer expert has created a website enabling anyone to send an email about the war in Ukraine to up to 150 Russian email addresses at a time, so that Russian people have a chance to hear the truth their government is hiding.

All over Russia email inboxes are pinging.

Millions of messages are being received with the same intriguing subject: Ya vam ne vrag – I am not your enemy.

The message appears in Russian with an English translation and it begins: “Dear friend, I am writing to you to express my concern for the secure future of our children on this planet. Most of the world has condemned Putin’s invasion of Ukraine.”

The lengthy email goes on to implore Russian people to reject the war in Ukraine and seek the truth about the invasion from non-state news services.

In just a few days, more than 22 million of these emails landed in Russian inboxes, and they’re being sent by volunteers around the world, who are donating their time and email addresses to the cause.

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Can’t help but feel that this will have as much effect as changing the background on your Twitter page to blue and yellow. As much as anything, it ignores that fact that many Russians want to believe that Putin is doing the right thing, and that the sanctions (if they notice them yet) are being imposed because the West is angry at being thwarted in its Evil Plans.

It has been compared to leaflets dropped from planes. At least you could start fires with those.
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Apple currently has no plans to release a larger-screen iMac • 9to5Mac

Filipe Espósito:

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Sources told 9to5Mac that Apple currently has no plans to release a larger-screen iMac in the near future. The information comes from the same sources that revealed to us the plans for Mac Studio and Studio Display in advance.

As we previously reported, Apple has been working on the next wave of Macs with the new M2 chip, which includes a new MacBook Air, MacBook Pro, and Mac mini. However, when it comes to the iMac, the company currently has no plans to release new high-end versions of its all-in-one desktop for now.

This not only applies to a larger screen model, but also versions with Pro, Max, or Ultra chips. Based on information seen by 9to5Mac, Apple is working on a new 24in iMac expected to be introduced sometime in 2023, but similar to the MacBook Air and the 13in MacBook Pro, it is unlikely to feature Apple’s high-end processors.

Of course, keep in mind that Apple’s plans may change, and this doesn’t mean that the company hasn’t considered introducing different versions of the iMac before. But right now, our sources suggest that Apple is focused on promoting Mac Studio and the upcoming Apple Silicon Mac Pro to its professional users.

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OK, so the update might get the M2 (assuming that’s what it’s called) but it won’t have a 27in screen. Let this be an end of it. The iMac Pro/27in iMac: they’re both dead, Jim. The iMac is a consumer product.
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• Why do social networks drive us a little mad?
• Why does angry content seem to dominate what we see?
• How much of a role do algorithms play in affecting what we see and do online?
• What can we do about it?
• Did Facebook have any inkling of what was coming in Myanmar in 2016?

Social Warming, my latest book, and find answers – and more.


Errata, corrigenda and ai no corrida: none notified

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