Sunday , May 31 2020
Home / Epsilon Theory / Our Finest Hour

Our Finest Hour

Summary:
There is no country in the world that mobilizes for war more effectively than the United States. And I know you won’t believe me, but I tell you it is true: Last week we wrote a brief note (Getting PPE to Healthcare Workers and First Responders) to introduce our efforts to get personal protective equipment (PPE) directly into the hands of frontline heroes: healthcare professionals and emergency responders who put their own lives and their families’ lives at risk every freakin’ day to stem the tide against this virus. Today I want to share with you the story of how this effort has come together into something real and tangible. Today I want to invite you to join us. First let me tell you what we’re NOT doing. We are not competing with federal or state emergency

Topics:
Ben Hunt considers the following as important:

This could be interesting, too:

Demonetized writes The End of the Beginning

Peter Cecchini writes No Free Lunches

Rusty Guinn writes Too Connected to Fail

Rusty Guinn writes One for the Road


Our Finest Hour

There is no country in the world that mobilizes for war more effectively than the United States. And I know you won’t believe me, but I tell you it is true:


Last week we wrote a brief note (Getting PPE to Healthcare Workers and First Responders) to introduce our efforts to get personal protective equipment (PPE) directly into the hands of frontline heroes: healthcare professionals and emergency responders who put their own lives and their families’ lives at risk every freakin’ day to stem the tide against this virus.

Today I want to share with you the story of how this effort has come together into something real and tangible.

Today I want to invite you to join us.

First let me tell you what we’re NOT doing. We are not competing with federal or state emergency management authorities in their big bulk orders of PPE. We are not going to drive up the price of these supplies any more than they have already been driven up in this global scramble to acquire medical gear. But we are also not waiting on these federal or state emergency management authorities to get these big bulk orders and then trickle the supplies down to the frontlines.

What we ARE doing is putting together an end-to-end grassroots PPE distribution effort, where we source the equipment from certified manufacturers who meet accepted international standards, we pay for these purchases out of a 501(c)(3) foundation where 100 cents of every dollar goes to this effort, and we distribute that PPE all the way through the “last-mile”, getting small quantities of PPE directly into the hands of clinicians and first responders who are in urgent need.

Over the past 10 days we’ve purchased and distributed about 15,000 N95 and N95-equivalent masks directly to the doctors and nurses and firemen and EMTs who need the equipment NOW, in deliveries as small as 30 masks and as large as 500, depending on need. More importantly, we’ve set up a pipeline where we think we can get a steady delivery of 2,000 or so masks per day AND the occasional larger order AND the distribution capacity + knowledge to get this equipment directly to our frontline heroes. We’ve raised more than $200,000 to support this effort. We’ve partnered with incredibly generous private companies ranging in size from a Fortune 50 megacorp to the owners of the local UPS franchise. And we’re just getting started.


“Never doubt that a small group of thoughtful, committed, citizens can change the world. Indeed, it is the only thing that ever has.”

– Margaret Mead

Our Finest Hour

In the balance of this note, I’m going to go into some detail on the three components of our effort to contribute to #OurFinestHour: Sourcing PPE, Paying For PPE, and Distributing PPE.

I call this our effort because it doesn’t have be your effort. I mean … it can be! At every step along the way here, we’d love for you to join us. But you’re also welcome to copy us and do your own thing. You’re also welcome to do something completely different. Pride is one of the Seven Deadly Sins for a reason (and yes, there’s an ET note on that), and there is zero pride in what we’re doing.

So take what you will from our fight, as little or as much as you like. But however you decide to fight, make this YOUR fight.

That’s how we achieve #OurFinestHour.


Distributing PPE

If you are a healthcare worker or a first responder anywhere in the United States in urgent need of PPE, or you know someone who is, please fill out the online form below to get on our distribution list. Right now we are focused on N95 and N95-equivalent masks (more on the different types of masks in the Sourcing section of this note), although in the future we will try to supply isolation gowns and other PPE items. We CAN deliver directly to your home if that’s an easier way to get these supplies to you, although we WILL verify that you are who you say you are. Please feel free to use the Notes section liberally to describe your needs and constraints on acceptable equipment. We will do what we can!

On that “we will do what we can” note, we’re not promising anything here, except that we will, in fact, do everything we possibly can. I can’t tell you how many PPE acquisitions have already fallen through, how tenuous everything about this supply chain is, how frustrating it is to work with, through and around the bureaucratic obstacles to this effort in every country and at all levels. If we can’t get you what you need or enough of what you need, let us know. We will put you back on the list. We will try harder. But no promises.

Also, and this is important, we make every effort to allocate on the basis of need, not first come first served. We have several different data sources that try to give us a sense of where need is greatest, but nothing that can match your direct input. The more you can tell us about your situation, the better, and that includes telling us if your situation is okay right now but that you are anticipating a slam (we will schedule accordingly) or if your situation changes (either for better or for worse).

You can always contact us directly at [email protected] .

There is no charge to the recipient for anything we deliver. Ever.


Paying for PPE

Our Finest Hour

Epsilon Theory is supporting Frontline Heroes as our donation facility for #OurFinestHour.

Frontline Heroes is a registered 501(c)(3) charitable organization with an exclusive mission to get PPE directly into the hands of clinical staff and first responders. 100% of the money donated will be used to buy and deliver PPE.

We were able to get Frontline Heroes up and running so quickly because it is part of an existing 501(c)(3) charitable organization called Crutches 4 Kids, established by three NYC doctors to buy crutches and braces in the US and distribute that equipment to the children who need it in the rest of the world. With the Frontline Heroes initiative, they’ve reversed that model to buy PPE in the rest of the world and distribute that equipment to the healthcare workers who need it in the US!

Since establishing Frontline Heroes ten days ago, we have raised $200,000.

If you’d like to make an online donation, you can do so here.

If you’d like to connect directly with Frontline Heroes to discuss a donation that you don’t feel comfortable making online, please email me at [email protected] and I will connect you directly with a board member.

Similarly, if you are a foundation or charitable organization that would like to support this mission, or if you are a company that would like to set up a donation match for your employees (thank you, Intel, for leading the way!), also please email me at [email protected] and I will connect you directly.


Sourcing PPE

I’ve saved this section for last, because it’s the most complex. It’s also the best.

Less than two weeks ago, I got a Twitter DM out of the blue (we had never met) from Justin Christiansen, who works for Intel out of their Portland, Oregon office. Justin had already put into motion a crazy idea … instead of jumping through all of the hoops required to buy PPE in bulk from a factory in China (where all of this stuff is plentiful and cheap), he had reached out to some of his colleagues at Intel China and asked if they could personally buy masks over there and express mail them back to him in the States, so that Justin could deliver them to some hospitals in Portland who were in need.

Crazy, right? A purely bottom up and capitalist solution … just a couple of friends doing on their own what neither could do individually, but at teeny-tiny scale. Well, it worked. Justin got the masks and delivered them to the hospitals in Portland. So Justin DM’d me with an even crazier idea …

Why couldn’t we scale this up with a couple dozen Intel China employees and an appeal through the Epsilon Theory megaphone for doctors and nurses and EMTs and firemen and everyone else to let us know if they needed PPE?

So we did. And before we knew it, we had a steady stream of PPE en route from China, and we had 400 urgent requests from healthcare workers and first responders. And before we knew it, we had a lot of generous people looking for a way to donate their time and money to support these purchases. And before we knew it, we had leads on larger purchases and then a donation of 10,000 masks.

This is how the world changes. This is how we win this war.

Not from the top down, but from the bottom up.

Not through a single policy diktat from on high, but through ten thousand individual acts of grace and goodwill from ordinary people just like me and just like you.

Ordinary people who recognize the Once In A Lifetime nature of the challenge we face, and who RISE to that challenge with wisdom and empathy.

By the way, remember all of those Intel China employees actually making the PPE purchases and actually paying for shipping to the US? They did ALL of this out of their own pocket and on their own personal time. Yes, they did.

I mean, it hasn’t all been smooth sailing. Over the past ten days we’ve had a crash course in certification standards and the … ahem … distinctive challenges of Chinese business practices and … ahem … distinctive challenges of American hospital administration practices.

I know that everyone is concerned about the quality of PPE sourced from China.

WE ARE, TOO.

I think that we have a good understanding of, for example, the difference between a GB2626-2006 certification for a KN95 mask (approved by the CDC as an equivalent to the NIOSH N95 standard) and the GB19083-2010 certification (not approved by the CDC, despite higher performance characteristics in liquids exposure). I think that we have an advantage in our due diligence and purchasing by having a Mandarin-fluent team on the ground in China. I think that we can get accurate copies of the corporate certification documents and effectively evaluate the reputations of the Chinese manufacturers. I think that we can continue to spot check the quality of our PPE by asking US medical centers to test some of the masks we receive.

But I can’t be sure. I can’t promise you anything.

Except that we will always look at our suppliers with clear eyes and treat our recipients with full hearts.

Our Finest Hour

Clear Eyes, Full Hearts, Can’t Lose

Yours in service to the Pack,
Ben and Rusty


About Ben Hunt
Ben Hunt
He is the chief investment strategist at Salient, a $14 billion asset manager based in Houston and San Francisco, and the author of Epsilon Theory, a newsletter and website that examines markets through the lenses of game theory and history. Over 100,000 professional investors and allocators read Epsilon Theory for its fresh perspective into market dynamics.

Leave a Reply

Your email address will not be published. Required fields are marked *