This week in the backbone economy: PJM told Oklo to go sit in the penalty box, Allen Control Systems is building a counter-drone factory roughly the size of a small kingdom, and BMW has apparently decided that 3D printers are no longer for making little plastic Yodas and should instead help make actual cars. Diesel is flirting with $6, which is wonderful news for absolutely nobody who enjoys receiving things by truck, while Aalo and Valar Atomics went to Congress to explain that nuclear power is, in fact, pretty useful. Meanwhile, Andreessen Horowitz found another $1.1 billion between the couch cushions and launched a Machine Age Fund to finance the chips, robots, data centers, and other physical stuff required to keep our AI overlords adequately hydrated.

Elsewhere, La-Z-Boy is spending $23 million to manufacture more places for Americans to sit, Papa Johns has somehow entered the Walmart cinematic universe, and restaurant workers are discovering that the post-COVID labor market may no longer be playing on easy mode. Manufacturers are redesigning products and supply chains because tariffs and shipping lanes continue to behave like random-number generators, Base Power keeps quietly trying to reinvent the utility company, and homebuilders have responded to expensive land with the groundbreaking architectural insight of: what if house… but taller? All told, another perfectly normal week in which nuclear reactors, drones, pizza, couches, batteries, diesel fuel, and three-story townhomes somehow belong in the same economic conversation.

Redesigning your product and supply chain is a lot easier said than done. I tried to do this in college for a supply chain course I was taking and the professor was not a fan and all I did was move around operations within the United States. Also if we have learned anything from my recent pieces, its that most manufactures have long term relationships with their suppliers and jumping ship often takes months of diligence work and new suppliers must meet compliance requirements. Supply Chain procurement teams should have multiple suppliers for parts on the payroll at all times This enables them to quickly absorb any delays and ship product allowing them to mitigate tariff and bottleneck exposure.

I think this little dude and the other AI ‘toy’s that are coming out are most excellent. These are all interesting cheaply made interfaces that give users a new way to interact with AI. I think these cheap hardware plays will gain massive traction before we see these types of tools installed within the industrial system. This mini duck makes me think of what Gecko Robotics is building but this version is for your kid.

“Oklo asked the Federal Energy Regulatory Commission to order the PJM Interconnection to reinstate its 750-MW, mixed-technology project.” … This is a very interesting nugget of news coming out of the nuclear world. The communication between Oklo and PJM seemed to be spotty. PJM noted that Oklo had not shown the project could remain stable through a sudden drop in grid voltage. This could lead to the project being delayed up to 14 months and incur significant cost overruns. The bottleneck question is whether the institutional plumbing can move as fast as the physical infrastructure.

Zach Dell is an absolute hitter, Base Power is a growth machine. His company has been growing like a weed, Base Power’s model sits squarely at the intersection of batteries, grid reliability, vertically integrated infrastructure and the question of whether the next utility gets built differently from the last one.

The restaurant labor market has historically been wild, especially after the COVID hiring frenzy and the slow wage growth, high turnover, xyz issue 34, and that one good thing. The sector saw its unemployment rate jump to 6.8% in august with quits, openings, and new hirings all plateauing over the past year. This gives the employers the bargaining power supirsingly as operators now have more flexibility on pay, staffing / rendition than they did during the peak crunch of the COVID shindig.

La-Z-Boy is adding a 150,000-square-foot distribution center alongside one of its oldest manufacturing plants, with about 100 jobs expected. Another small but tangible example of manufacturing and distribution capacity being co located closer to the U.S. customer. This is great news, as we are seeing the downstream effects of reshorting and manufacturing jobs being recreated.

Herb Greenberg revisits the late Ted O’Glove’s 2014 argument that Berkshire should eventually be broken apart, noting Berkshire has roughly matched/slightly lagged the S&P since the original call and Buffett has now stepped aside. This is something i’ve never even even thought of. While you may think the person who operates this page would be a Buffett fan, I am not. Herb’s blog is also a Riff. I doubt that the government will ever call for Berkshire to be broken up but it would make sense for them to start selling less core assets.

ACS is the genius company behind the Bullfrog, a counter drone startup. They already have plans to deploy more than 80 Bullfrog systems this year. Drones and counter drones are where the capital is flowing currently, if you watched the first episode of Lioness (haha yes) you would understand. or more realistically, if you’ve been paying attention to any of the news coming out of the Ukraine-Russian war. This is a huge facility though so I hope to see ACS working with our friends across the globe on setting up counter drone systems.

BMW is pushing wire-arc additive manufacturing deeper into automotive production, WAAM is moving additive manufacturing beyond prototyping and toward large-format industrial parts and production tooling. The closer this gets to the factory floor, the more interesting it becomes for machinery, metals, and manufacturing economics. BMW has been innovating with the additive systems since the 1990s, and later used it for the Rollys Royce and produced the series series of metal competenats for the i8 Roadster.

You don’t need to read some persons email to tell you that is is not good. They really had us in the first half, I don’t often pay attention to the deasil prices as the car I drive does not require it. But my time as a greenskeeper taught me the importance of diesel and how many tools that normal people use / see everyday rely on diesel. The downstream impacts of this are obvious.

I was many subcommittee hearings oddly enough ranging in all sorts of topics. This was one of the most productive hearings i’ve ever listened to, both sides of the aisle agreed that we need to build out our nuclear energy capability but doing so while being safe yada yada.. Aalo and Valar Atomics both did an excellent job at representing the Nuclear industry, I am less familiar with the Aalo team, but they team to know ball. Valar Atomics, they know ball.

They used to ask how low can you go, now they ask how high. Homebuilders are increasingly designing upward on constrained lots. Vertical floor plans are another response to land scarcity and housing affordability, letting builders squeeze more usable square footage from expensive parcels.

Papa Johns is plugging directly into Walmart’s delivery ecosystem, enabling customers to buy Papa Johns Pizza directly from the Walmart site and have it delivered. Restaurant distribution is increasingly becoming part of larger retail and logistics networks instead of remaining confined to the restaurant’s own storefront and app.

Andreessen Horowitz creates a $1.1B Machine Age Fund. The new vehicle is explicitly aimed at accelerating the physical buildout around AI, a notable crossover between venture capital and the industrial infrastructure. “This fund will invest into all of the computer infrastructure on which AI runs, including chips, memory, networking, and storage. It also includes full systems for running AI: from data centers to robotics to home AI appliances.”

“When a measure becomes a target, it ceases to be a good measure.” The mechanism is simple: once people are rewarded for hitting a metric, they start optimizing the metric itself rather than the thing the metric was supposed to represent. A hospital judged exclusively on waiting times can manipulate scheduling; a sales team paid on meetings booked can fill the calendar with garbage; a factory rewarded only for units produced can crank out defective inventory.

The idea traces to British economist Charles Goodhart, who described a related problem in monetary policy in 1975: statistical relationships tend to break down once policymakers try to control them. The punchier modern wording came later and broadened the idea far beyond economics. Today it gets invoked so casually that people sometimes treat every KPI as inherently corrupt; the actual warning is narrower—measurement changes behavior, especially when rewards attach directly to the number. (Sketchplanations)

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