Dan's Notes / Issue 10: Human Scale • Patina and Intimacy • Is Crypto Re-Creating the 2008 Financial Crisis?

Last week I shared an AI art-making tool called Midjourney that produces art from text prompts. This week OpenAI announced a similar tool called DALL-E, and the results are even more incredible. Nick Cammarata has a long thread of DALL-E illustrations made from his friends' Twitter bios:

And here's another thread with DALL-E-generated images and their prompts:

More: Meet DALL-E, the A.I. That Draws Anything at Your Command (NYT)

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Is Crypto Re-Creating the 2008 Financial Crisis?

In last week's Galaxy Brain, Charlie Warzel interviews Hilary J. Allen, a law professor at American University who studies financial crises and their effects on regular people, about the parallels she sees between crypto & DeFi and the run-up to the 2008 financial crisis. ("DeFi" refers to 'decentralized finance', the category of blockchain-based financial tools and services popping up around crypto.)

Specifically: deliberately complicated financial products that are difficult to understand by design; excessive risk-taking and over-leveraging; and predatory financial instruments targeted at low-income people at a time when the wealth gap is larger than ever and more people are looking for a quick way to get ahead.

Crypto already experienced a major sell-off in 2017-2018 - Bitcoin dropped 65% in a month and the whole industry lost about 80% in 2018 - but at that point it was still mostly independent from the world's financial systems, and there were few spillover effects. Today, says Allen, is much different: the line between banking and crypto is becoming increasingly blurry, and without putting regulations in place, a potential crash - or an inevitable crash, depending on who you're asking - could have far worse consequences this time around.

Warzel writes that it was "one of the most fascinating and eye-opening conversations" he's had about crypto, and I concur - after spending much of 2021 exploring the web3 space enough to understand what web3 & crypto claim to offer, I'm firmly in the "crypto skeptic" camp and I'm glad to see more conversations like this taking place.

[T]he complexity of the crypto world is only justified by the idea of decentralization. [...] But everything that’s been built on the back of the blockchain since seems to be trying to deal with the idea that this decentralization is purposefully wasteful, slow, and complicated. Now, in order to get rid of intermediaries, they’re using intermediaries. They’re losing the decentralization, but they’re keeping the complexity.

People think the system is rigged, and they’re not wrong. When people think the system is rigged, they say, “Well then, why not bet?” [...] When it feels like you can’t get ahead the normal way, people start gambling more. Just in general, society is gambling more.

See also: Meme stocks and Bitcoin will not redistribute wealth (paywall)

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Human Scale

File this one under "Dan's canon" - human scale is a concept I learned about a few years ago, and it's changed the way I think about cities and the types of places I want to spend time in. Human scale refers not just to the size of a place, but how it's designed: streets where people are prioritized over cars; parks are more prevalent than parking lots; businesses and buildings are owned by locals; sense of community is strong.

A near relative to the term human scaled is when we talk about a town or neighborhood being walkable. What the term means is simply this: a human scaled town is one where you can live almost your entire life within walking distance. In a human scaled town work, rest, play, pray—essentially all everyday tasks—happen within a radius the average person will easily—and happily—be able to walk on foot. [...]

Most modern towns and cities devote somewhere between 25-60% to parking lots and access roads to these parking lots. Mandatory parking and even more so, mandatory driving and mandatory commuting, makes every new building or home built a new headache for the people who already live there. In a human scaled town, a two story apartment building getting three more floors means more neighbors, more life in the street, new faces in the local taverna, more customers in your barber shop, more potential team mates for your kid’s soccer team.

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Patina and Intimacy

Simon Sarris writes about what we lose when 'utilitarian influences' consume the spaces we spend time in.

Certain surroundings seem to dispel enchantment, and others encourage it. We take consolation in a good landscape. Architecture, good or bad, twists and turns our moods. Do our homes and public spaces resemble places of enchantment? [...]

[...] the trend is trying to make environments that could be called open, uncluttered, free of distraction, easy to clean, and low-maintenance. These are often benefits, but we should never lose sight of the tradeoffs made in their deference. And we should ask ourselves, very carefully, if they are really the tradeoffs we want to make. [...]

Handcrafted objects, textured colors, unpainted and unpolished surfaces (my walls show their raw plaster), natural materials, sunlight and shadow—all of these are signs of life. Life accepts the imperfect and the changing.

See you next week,

-Dan