👋 ASB Partners Nuggets 7.25.25

This is a short weekly email that covers a few things I’ve found interesting during the week.

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Interesting Links/Reads

Many links are sourced from Marginal Revolution (bold and italics are my own to highlight what I found particularly interesting)

1. Claims about alchemy.

   

   2.The ‘Smart’ Restrooms That Can Solve America’s Public Bathroom Crisis Throne Labs is betting that Uber-like ratings and privacy-protecting sensors can lead to a better, more enduring system

Locked but open

Throne’s solution relies on gating access to their facilities, but in a way the company’s founders insist means they remain accessible to all. Users are associated with a unique identifier via an app or text message, so dumbphones work too. (In rare cases, those who don’t have a phone can get a keycard.) If you mess up the bathroom, you’re given a warning, and if you’re a repeat offender, you could lose your potty privileges. It’s similar to an Uber rider score, says Throne Labs Chief Executive Fletcher Wilson

(Editors Note…proud that I made it into Marginal Revolution this week)

3.AI Is Growing Up, and So Are Users Grok’s ‘Hitler’ moment is a throwback to the

boring days of prompting chatbots to say stupid things. Holman W. Jenkins, Jr. By

Holman W. Jenkins, Jr. Follow July 18, 2025 5:06 pm ET

Large language models are nothing more than vastly complicated statistical machines for noticing patterns of words, images or coding terms in digital libraries.

They surface knowledge and insights via a process that, to be useful, occasionally also produces nonsense. And yet users by the millions show they have no trouble disregarding AI output that makes no sense or is useless. Clearly, the public is ascending the learning curve when it comes to getting useful work out of the new technology.

3.Small Stocks May Be Too Cheap to Pass Up Jason Zweig By Jason Zweig , Columnist

Since the beginning of 2014, the S&P 500 has grown at an average of 13.2% annually, while the Russell 2000 index of small stocks has gained just 7.2%.

Much of that underperformance comes from underexposure to this market’s hottest sector. Technology firms constitute nearly 34% of the total capitalization of the S&P 500, versus less than 13% of total value in the Russell 2000.

The market value of the five biggest companies in the S&P 500 is nearly five times the combined market value of the Russell 2000 index, according to Steven DeSanctis, an equity strategist at Jefferies. In fact, Nvidia alone—at its recent market value of $4.22 trillion—is 65% more valuable than all the stocks in the Russell 2000 combined.

The 6.6% annualized total return on small stocks over the past 10 years trails large-company performance by 7.3 percentage points, says DeSanctis. (All figures include dividends.)

Smaller stocks, on the other hand, have gotten so cheap relative to the market’s giants that “even if you fall from here,” says Wang, “you’re only falling out of a one-story house now.”

4.Shorting Your Rivals: A Radical Antitrust Remedy by Alex Tabarrok July 21, 2025 at 7:18 am in Economics Law

Conventional antitrust enforcement tries to prevent harmful mergers by blocking them but empirical evidence shows that rival stock prices often rise when a merger is blocked—suggesting that many blocked mergers would have increased competition. In other words, we may be stopping the wrong mergers.

In a clever proposal, Ayres, Hemphill, and Wickelgren (2024) argue that requiring merging firms to short the stock of a close competitor would powerfully realign incentives.

5.In developing countries, people are trying to increase their standard of living and get AC, while developed countries are busy trying to AC their computers (AI). AC use is expected to be the second-largest source of global electricity demand growth after the industry sector, and the strongest driver for buildings by 2050. The stock of air conditioners in buildings is forecast to rise from roughly 1.6–1.8 billion units today to around 5.6 billion by 2050. Cooling already accounts for ~10% of global electricity consumption, and as adoption grows it is poised to become the single largest driver of building electricity demand growth through 2050.

An interesting implication of this is that it will mostly add substantial baseload demand at night. This will require large investments in new power plants to meet peak power demand at night, which cannot be met with solar PV technology.

It’s the same trend across the rest of Asia.

How to play this trend?

I have a few ideas….

6. How safe are bicycles?

7. New Jersey does not deserve to do so well in this ranking.

   

   8.A 450% Rent Hike Hangs Over One of the Last Affordable Buildings on Billionaires’ Row Monthly costs at Carnegie House in Midtown are set to skyrocket, thanks to the wealthy real-estate investors who now own the land beneath the building

On July 18, an independent arbitration panel announced a ruling that would increase the annual rent at Carnegie House 450%, from $4.36 million to roughly $24 million, following an arbitration process triggered by failed negotiations between the landowner and the co-op. For Hirsch and Strauss, the ruling means their monthly costs could spike from around $5,000 to roughly $13,000, Hirsch said.

Many residents said they suspect the landowner—a limited liability company tied to real-estate magnates Rubin Schron and David Werner—hopes to drive them out, tear down the building and build a new supertall.

But in 2014, the land was purchased for $261 million by an entity led by Werner and Schron’s companies. In marketing materials, real-estate brokerage CBRE said that the site offered “unique future potential to construct a luxury retail, hotel and condominium tower.”

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Podcast/Videos

Very interesting discussion about Stablecoins

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I hope you enjoyed it.

Adam