1) One business where Amazon failed
Amazon plans to
shutter its four-year-old Amazon Restaurants delivery service in the US this
month. Amazon started the food-delivery service as on-demand meals were
becoming big business for tech startups, with companies like Postmates,
DoorDash, Caviar, and Uber Eats competing to deliver food from restaurants to
consumers. Others, like Sprig and Maple, went further, vying to both prepare
and deliver freshly cooked meals. In the US, Amazon Restaurants was available
for free to customers with a $119-a-year Prime account.
Restaurants aren’t
the first delivery-based business to evade Amazon, which is otherwise a master
of logistics. The company has famously struggled to make online
grocery-delivery work, with Amazon Fresh still a niche player more than 10
years after its launch.
Food delivery is a
tough business with complex logistics, labor practices that are often poor, and
notoriously thin margins. Many of the hottest delivery companies in Silicon
Valley just a few years ago have since gone out of business.
2) A real simple guide to the controversial paper by
Arvind Subramanian
This is a very
well-articulated, yet simple article on what Arvind Subramanian has talked
about in his paper on GDP mis-representation. A must-read.
3) Chennai is facing an unprecedented water crisis;
and it can spread to all of India, unless we start acting fast
Rains have become
more erratic because of climate change. That, coupled with a delayed arrival of
the seasonal monsoon, which usually comes in June, has all but dried up
Chennai's water supply. Government data show that the storage level
in the four lakes combined is less than one-hundredth of what it was at this
time last year. A severe heat wave gripping most of India, including Chennai,
has aggravated conditions.
What's happening in
Chennai could easily happen anywhere across India
Public institutions
are suffering. Hospitals and nursing homes are charging more for services to
cover the increased cost of water, according to the local press. There are also
reports that toilets at schools are dirty due to a lack of water.
One thing that could
have possibly averted this acute water shortage? Rainwater harvesting.
In 2002, the
government of Tamil Nadu passed legislation that mandated rainwater-harvesting
structures on all buildings, including private homes, in the city. The goal: to
capture rainwater and store it for later use. It was a revolutionary idea. When
the city got hit with heavy monsoon rains a few years later, rainwater
harvesting raised the water table enough to last the city until 2016.
4) Understanding the psychological drivers behind the
mistake made by Bill Ackman on Herbalife
Although this
article does not deal with the psychology, it does provide the narrative of
what happened in the Herbalife deal. I was thinking on the errors made by Bill
Ackman. Incentive caused bias, endowment bias, commitment and consistency bias
scream at me. That is why it is never a good idea to take a public stand on a
stock and make its success a matter of one's own ego.
5) JP Morgan's view on how to navigate a cycle which
may be peaking
JP Morgan is not
suggesting that US is getting into a recession yet believe that investors
should start taking precautions. Moving to higher quality bonds and equities is
the first and most important step. Looking at investments from a yield
perspective and moderating capital appreciation expectations is the next. The
third is to look where the growth is. Trade war, global manufacturing slowdown
and liquidity in markets are all marked as risks.
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