Too Stupid for Conspiracies

To anyone in the Moslem world who saw the photo of John McCain in Syria backslapping a group of valiant rebels, one of whom turns out to maybe be a leader of a Sunni brigade which recently kidnapped a busload of peaceful Shia religious pilgrims (the photo ironically having been taken while McCain was on a trip to demonstrate that it's a simple affair to determine which rebels we should arm so we can ensure those arms stay out of the hands of violent crazies), and who understandably feel convinced of the truth of rumors that the United States is in a conspiracy with Israel and Saudi Arabia to inflame the Syrian civil war (which has transformed - as of course it had to - into a Shia/Sunni civil war) as a pretext to completely wipe out Shia Islam:

Please understand that you flatter us with such theories. I know, I know...America seems so smart and powerful. But we're not that smart. We're what I call a strong drunk. And while this photo seems rife with innuendo, the fact of the matter is (obviously to any American, though not to non-Americans) it's just a blowhard politician being an idiot. Only in the midst of extreme intelligence is everything meaningful. So if you want to understand America, look to The Simpsons rather than to Oliver Stone.

Remember Leff's Fourth Law: "95% of apparent maliciousness is actually incompetence."

Preference Vs. Rome

From birth, Americans are encouraged to cultivate slews of preferences. Preference is king in a rich society where abundance must constantly be winnowed.

Turn-offs and turn-ons. Pet peeves. Facebook likes. Soup or salad? What's your favorite band/sports team/color? Are you a leg man or an ass man or a breast man? Blondes or brunettes? How do you take your coffee? What's your drink? Should toilet paper roll down the back or down the front? I hate when people do this! But I'm really into that!

It's all bullshit, an epidemic of popular delusion, an extreme indulgence. Our preferences are ridiculously arbitrary and meaningless. If you think you prefer stuff one way, try just pretending you like that stuff the other way for a couple of days. You'll find that your preferences flip with disorienting ease. There's no "there" there.

How can a died-in-the-wool Chowhound say such a thing? Isn't my career, my life, my Slog, seemingly dense with preference?

No. As a food critic, I never had the luxury of ordering what I felt like eating. My task was to determine what the restaurant does best, and to enjoy and judge that on the merits of deliciousness rather than how well the food hews to my personal preferences, or satisfies my momentary cravings, both of which are irrelevant to the task.

I don't like fish for breakfast, but if I'm eating breakfast in Tokyo, I'd never demand corned beef hash. Rather, I'll fall in love with what I'm with - at least so long as it's great! Restaurant reviewing - or even just plain old chowhounding - is the ultimate "When in Rome" pursuit. And after years of it, I'm left with very few personal preferences. What do I like? I like good!

(Spare me the relativist rebuttal; there are lasagnas that would make any feeling person pound table with fist, so, no, it isn't all impossibly subjective...especially once we get past the pointless realm of personal preference and plunge into deeper realms of beauty and inspiration, where we're more open and where there's actual meaning.)

Same with music. There are songs that make me lunge for the radio to change station. But if I, as a professional musician, am called to play one of those tunes, you'll find me in a place beyond shallow preference. Again, I'll be "when-in-Roming". Hire me to play cheesey disco music, and I will play every note like I've never wanted to play anything else. And it's not a pose; it's real. Because artistic commitment is deep, whereas preference is shallow.

I dislike green peppers. But if you cook something great with them, I'll fully appreciate them, because my appreciation of greatness trumps my niggling preferences. Preferences are meaningless childish caprices best transcended like other childish habits. Beauty, inspiration, and magic are the pinnacle of humanity. That's where human maturity is.

Over and over, my curse is to ask waiters and bartenders to recommend their most delicious glass of wine, and then cringingly await the inevitable response: "What kind of wine do you like?"

I like good wine, dammit! Did you not hear me? I don't want the wine I want! I want the wine that makes me glad to be alive! Please, for god's sake, stop trying to press my preference button! That's not who I am!


My story about The Monks and the Coffee explains what to me is the only sane and mature route of appreciation.

Learning is Change

Whenever someone asks me to fix a computer problem because they're "bad at that sort of thing", I tell them I wasn't born good at it, myself. I've just lived through enough computing issues to have learned how to handle problems, aggravations, and disasters.

Something goes wrong, and I dig for answers. Sometimes it takes hours, but those hours are spent learning. I don't perceive it as suffering, I chalk it up to growth. And the next time the same thing goes wrong, I know what it is and how to resolve it.

People who are "bad at this sort of thing" are just people who choose not to grow. When you have an ingrained self-image of Not Knowing, every problem's a dead end. The self-image supersedes resourcefulness.

For years, I drove $1200 beater cars, and came to experience every scenario of car trouble. I never learned mechanic skills, but cars no longer seem mysterious. Repeated failure brought experience, and experience yielded wisdom.

Rereading my SIGA postings, it's disorienting to hear myself fluently analyzing biotech stocks. How did I get here? Here's how: I invested a significant chunk of my savings into a very promising biotech company that turned out to have a stormy, troubled development curve. I had no choice but to learn.

Same thing when I reread my story of Chowhound's growth and sale. Who would have guessed, during my musician days, that I'd grapple with such business issues? It honestly doesn't fit my self image, even now. I know how to run a big web site? And manage workers? Me? You're kidding! But once Chowhound became unexpectedly popular, it was either "learn" or "drown". There was no choice.

Some realms remain slow and sticky in spite of repeated efforts. I'll never be deftly expert at design or home repair or a few other things for which my faculties are ill-suited. But, as I've explained before, some of those slow, sticky realms are the ones where I actually cough up some of my best results, albeit slowly and with great effort.

Scientists say it's very difficult to learn new skills after one's mid-twenties. I think they're slicing that wrong. What happens is that it becomes very difficult to imagine (and to tolerate) change as one's self-image solidifies. And learning is change.

But when learning's compelled by dire circumstance (as it seldom is in a rich, complacent, laziness-accommodative society where help's cheap and abundant), change becomes attractive. And then you'd be surprised how much you can learn.

If you want to learn, either place yourself in intensely compelled circumstance (that's what Outward Bound is), or else seek out ways to artificially self-compel. Passion or anguish are the classic routes, and the former's way more fun.

SIGA: The Parasite's Dilemma

In my posting earlier today, I described a worst-case scenario:

Judge Parsons, groping for safe ground (he doesn't want to be reversed twice on the same case), may resort to the original terms SIGA and Pharmathene had been negotiating those many years ago. They would have assigned the drug to Pharmathene, who'd pay SIGA a small licensing fee of 8-12%. The problem is that Pharmathene never did any of the many things required to earn this control of the drug. And it's impossible to roll back the clock and determine where Pharmathene would be right now, money-wise, if they had (and thus determine their "injury"). It's hardly fair for SIGA to lose nearly all revenue from a drug whose development, marketing, and risk was footed entirely by them.

For those reasons, I don't think it will happen like that. But there are other factors to consider if Judge Parsons did go that route.

If control of ST-246 were taken away from SIGA and given to Pharmathene, SIGA's lucrative contract to produce ST-246 for the government would be null and void, forcing Pharmathene to:

1. gain the government's trust (Pharmathene has no successful scientific track record, just a long history of the sort of hyperbolic public touting which rubs health authorities and homeland security bureaucrats the wrong way),

2. pursue a contract of their own (after a long bidding period and extensive negotiations, which could take years...and be subject to the sort of protests that plagued SIGA's award), and

3. establish the rigorous and expensive corporate and scientific security measures required by BARDA of its contractors (which have already been completed by SIGA).

Also lost would be SIGA's connections (with other nations, with WHO, and with scientific bodies) with respect to ST-246.

The loss in value, connections, and marketing - as well as the substantial time delay and added uncertainty - would make this a distasteful scenario even from Pharmathene's perspective. I'd imagine they'd prefer a parasitic relationship, effortlessly sucking off their share. That's what the original decision ordered, and my speculation is that this is how it will wind up (though, hopefully, at a more modest profit split).

SIGA: The Judge's Paradox

The holiday weekend gives us lots of time to ponder the Sphinx-like appeal decision. As I wrote on Saturday, Judge Parson, who found expectation damages impossible to assess, has been ordered to assess expectation damages. So where will he go?

The last time Judge Parsons felt sufficiently exasperated to split a baby, he literally split the baby, arbitrarily awarding 50% of net profits of ST-246 to Pharmathene. But the rationale for that split has been kicked out from under him. The principle of promissory estoppel allows a judge to impose an arbitrary, speculative, Solomonic solution, but the Supreme Court ruled that promissory estoppel doesn't apply here. So this time the judge must be non-speculative in awarding damages. But this is a judge who's gone on record saying that expectation damages would be too speculative to award.

This sounds like good news for SIGA, but the philosophy major in me quakes. One of the first lessons in logic is that when premises are contradictory, any conclusion's as good as any other (including, famously, "The moon is made of green cheese"). In other words, literally anything could come out of this situation.

Judge Parsons, groping for safe ground (he doesn't want to be reversed twice on the same case), may resort to the original terms SIGA and Pharmathene had been negotiating those many years ago. They would have assigned the drug to Pharmathene, who'd pay SIGA a small licensing fee of 8-12%. The problem is that Pharmathene never did any of the many things required to earn this control of the drug. And it's impossible to roll back the clock and determine where Pharmathene would be right now, money-wise, if they had (and thus determine their "injury"). It's hardly fair for SIGA to lose nearly all revenue from a drug whose development, marketing, and risk was footed entirely by them.

SIGA investors may take comfort in Judge Parsons previous declaration this term sheet oughtn't apply in present day. But, then again, he also declared that there's no non-speculative way to assess expectation damages. Judge Parsons is down a rabbit hole, and anyone who tells you they can predict the outcome is lying.

When lost in paradox, it's always smart to seek solid ground. In that spirit, I offer a few highly pragmatic observations:

1. Half an Enormous Jackpot is Still Huge
In the end, I'm figuring the worst-case downside remains something like where we're at today: Pharmathene getting roughly half the net profits from this drug. At trial, Pharmathene estimated the drug's potential as $4 Billion, and I don't think that's far off. And SIGA can do very well, indeed, with $2B.

2.Cloud Be Gone!
SIGA's stock is priced irrationally, even with a 50/50 split. That's mostly due to the legal cloud, which is hopefully near an end. At this point, I'm more eager for an end to this litigation than I am for an optimal result.

3. Pipeline
When last we heard, SIGA was going great guns with its dengue drug. Dengue Fever is a huge real-world problem, so potential profits greatly exceed those for smallpox. SIGA had been working on other promising early-stage drugs, too, plus they have a great antiviral discovery and development platform. And it's important to remember that this lawsuit affects only the smallpox drug, ST-246.

While there are high-flying biotech stocks whose entire portfolios are at the early stages of SIGA's pipeline, the market currently values SIGA's pipeline at precisely zero.

4. Ignore the Ticker
SIGA and Pharmathene stock may, over the next few weeks, go absolutely crazy. But none of that, in my opinion, will be predictive of anything. Again, Judge Parsons is down a rabbit hole, and anyone who tells you they can predict the outcome is lying.

5. New Law
This was not the decision I was expecting, obviously (though it may yet turn out favorable for SIGA). I hadn't anticipated that the Delaware Supreme court would make new law.


FWIW: There was no actual bad faith in this case. What happened is that former SIGA CEO Donald Drapkin was best friends with SIGA mega-investor Ron Perelman. When their relationship soured, Drapkin was treated egregiously, and he lashed back via his testimony in this case (the merger negotiation was under his management, so he was a key witness). The combination of an axe-grinding witness and shameless lying by Pharmathene's counsel was enough to skew the finding of facts and turn the judge violently against SIGA.

SIGA's Appeal

The Delaware Supreme Court has spoken. The original decision, with its bizarre "split the baby" solution ordering a 50/50 profit split for SIGA's drug, ST-246, has been reversed. The original judge, Parsons, has been ordered to start over and assign only expectation damages (which, if I understand correctly, would need to reflect ST-246's position back in the 1990's, as an unproven drug with no government contract on the horizon).

And here is Judge Parson's previous explanation (from his written decision) of why SIGA should pay no expectation damages at all:

Having carefully reviewed the testimony and reports of PharmAthene’s experts, including especially Baliban, I find that PharmAthene’s claims for expectation damages in the form of a specific sum of money representing the present value of the future profits it would have received absent SIGA’s breach is speculative and too uncertain, contingent, and conjectural.

Therefore, I decline to award such relief. The evidence adduced at trial proved that numerous uncertainties exist regarding the marketability of ST-246 and that it remains possible that it will not generate any profits at all. These uncertainties relate to, among other things, regulatory matters, questions of demand, price, competition, and the parties’ marketing competency. Moreover, when it comes to expert evidence, reliability is of the essence.

In appraisal proceedings, for example, this Court often accepts discounted cash flow (DCF) calculations prepared by experts, but also “repeatedly has recognized that the reliability of a DCF analysis depends on the reliability of the inputs to the model.”

Similarly with breach of contract claims to recover lost profits, “[r]eliability of the lost profits projections is essential in making a determination of lost profits.”

The huge fluctuations in Baliban’s estimated damages (in the hundreds of millions of dollars) based on changes to a few variables in his analysis confirm that it would be unduly speculative to attempt to fix a specific sum of money as representative of PharmAthene’s expectation damages.

I'm sure Judge Parsons will still manage to inflict some level of punishment. But he is seemingly boxed in by his own prior statement.

And, in any event, the market's irrationally and sharply undervaluing SIGA even at the very worst case scenario (i.e. even if the original decision stood). ST-246 is that biotech rarity: a fully developed drug whose remarkable safety and efficacy is challenged by no one. There's a big contract in hand, currently being delivered upon. Pharmathene valued ST-246 at $4B during trial. And this lengthy legal cloud is finally unwinding.

So I continue to look to the big picture: important and powerful people are clearly paying attention to SIGA - both in a positive way (their board keeps getting more impressive, having recently added a former Pfizer CEO) and negative (lawsuits, accusations, shorting frenzies). If there wasn't big substance and potential, none of this drama would be happening.

I.e. lots of people angling for a piece of a prospective pie is a big "tell" that there's prospective pie.

Temple Grandin's Brain Works Just Fine

I just found the most beautifully apt analogy.

Quoted in a review in The New York Review of Books of her new book, "The Autistic Brain: Thinking Across the Spectrum", Temple Grandin writes:

Researchers...can’t assume that if a patient is exhibiting abnormal behavior and the scientists find a lesion, they’ve found the source of the behavior. I remember sitting in a neurology lecture in graduate school and suspecting that linking a specific behavior with a specific lesion in the brain was wrong. I imagined myself opening the back of an old-fashioned television and starting to cut wires. If the picture went out, could I safely say I had found the “picture center”? No, because there are a lot of wires back there that I could cut that would make the TV screen go blank.

The picture depends not on one specific cause but on a collection of causes, all interdependent. And this is precisely the conclusion that researchers in recent years have begun to reach about the brain—that a lot of functions depend on not just one specific source but large-scale networks."

So, if you ever hear that fMRI can tell us people’s political preferences, or how they respond to advertising, or whether they’re lying, don’t believe it. Science is nowhere near that level of sophistication yet—and may never be.

Discomfort is Not Poverty

Want to see how a simple flip of perspective can totally transform your view of things? The next time someone complains about money problems to you, see them for what they are: fabulously wealthy people bemoaning their relative paltry level of fabulous wealth. Anyone in the first world yearning to get rich is really just dreaming of getting richer.

As I wrote earlier this year:

It's good to bear in mind that even if you're at the poverty line in America, you are rich beyond the wildest dreams of the vast majority of humanity. You are richer than 99% of humans who've ever lived. In terms of sheer comfort (money mostly buys comfort), you are far better pampered than any historical king or emperor, with your indoor plumbing, central heating, automobile (and highway system), overabundance of food and entertainment, nearly-assured personal safety, EMS, and broadband Internet. Julius Caesar would have swapped places with you in a heartbeat.

Remember this the next time you notice someone has a bigger TV or nicer apartment than you, making you feel "poor". You're not poor. You're just slightly less fabulously wealthy.

Need proof? Just try to get someone to do something - anything - for fifty bucks. Seriously, try it. No American at this point will scratch his ass for fifty bucks. Fifty bucks is the errant penny not worth stooping to reclaim.

The poorest person I know, a buddy who was recently evicted from his home and also had his business evicted from its shop (I had to help him move stuff to storage because he couldn't afford a mover), who sleeps on the floor because he can't afford a mattress, and who is actually quite a hard-working fellow, just turned down $35/hour yard work from me on Memorial day....because it's a holiday.

I'm not saying my friend's life is particularly comfortable or enjoyable. But that's not poverty. What he's experiencing is discomfort. America is so rich that we mistake mere discomfort for bona fide poverty.

Cool Google Doodle

Don't miss today's cool Google Doodle tribute to Saul Bass, the brilliant designer of film titles for Hitchcock, "Man With the Golden Arm" and more.

A Google Doodle is the image appearing atop Google's home page, which sometimes pays tribute to the quirky, the legendary, or the quirkily legendary.

Aiming For Infinity

I had a very interesting dinner conversation tonight.

(We ate at Rai Rai Ramen in Franklin Township, NJ, which, along with neighboring Somerset, is the most promising and fertile chow zone in the Tristate area. Rai Rai is another instance of Taiwanese fascination with Japanese food, but while the ramen's pretty good, their short Taiwanese menu is super - even better than can be found in Flushing.)

Over pork rolls and fried chicken pieces, we discussed the sort of people who spend their lives pushing like crazy to make more and more money, even long after they have more than they need. My dining companion had an interesting perspective: that raising and supporting a family is such a formidable challenge that people can easily get stuck in a panicky sense of aspiration.

This reminded me of a great insight from my yoga teacher, who's observed that students working to achieve a difficult stretch often aim for infinity. That's a big mistake. If you don't aim toward a specific arrival point, you will, over time, wind up overdoing, pushing your body to do things it's not made to do, as you stretch further and further toward infinity like an out-of-control robot.

I think that's the mistake people make with money. They get so lost in struggling toward infinity that they shoot unknowingly past the "enough" point. That's why some people never experience any sense of enough-ness, and remain weirdly money crazy till the end of their days.

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Updated in November, 2017
I'm thinking this point might benefit from a concrete example. The following yoga pose is hard for many people to do (at least with straight elbows). Note that palms are facing upward:

But having practiced it for forty years, I actually find myself turning my hands backward - i.e. too far the other way. This is: 1. unhealthy, and 2. messes up the alignment (and thus the benefit) of the pose. After spending decades investing full effort into this - not in itself a bad thing! - I find that I've worked beyond the landing point and strayed into the terrain of Bad Results. I should never have been aiming for "as far as I can go", I should have been aiming for "to the correct point". This is a very helpful insight, applicable to all sorts of realms.

Photo credit: Holly Walck Kostura via Maria's Farm Country Kitchen.

Follow-up posting here.