The sudden and collective realization that while, yes, we all concede that a 14-inch scimitar and a flask of Fernet Branca on your hip are cool, they’re not nearly as cool as health insurance and a 401k from a job where the sous chef doesn’t hump your leg every shift.
The problem with offering unsolicited advice is that people don’t like to be told what to do.
There’s a war of ideas. If wise people’s thoughts don't spread, other’s thoughts will. And the people who want their ideas to spread the most are rarely the ones who should be spreading ideas.
Ultimately, movements such as these will fail because they stubbornly refuse to understand core human drivers and incentives: the desire for life, for prosperity and for growth.
If you are reading this, you won ovarian lottery. Be thankful.
American is wealthy, influential, powerful, and increasingly equal. Don't let anyone tell you otherwise.
Knowing the high odds of something happening loses its meaning when that thing happening hurts. Probability goes out the window. Odds that are in your favor but still hurt are hard to distinguish from odds that aren’t in your favor.
It’s not until you focus on internal benchmarks and see how far you’ve come, relative to where you began – the gap between today and your own cost basis – that you have a good view of where you stand and what you’ve accomplished.
Americans are allowed and entitled to say almost anything we can dream up to say under something called The First Amendment to the US Constitution. We do not need permission from the left, Twitter, or the FBI to have a “theory” about anything.
As we say in Nevada, California Governor Gavin Newsome is a tremendous realtor. With every edict he passes and every sentence he utters, home values in bordering states go up.
The most important thing to remember about the markets is they are constantly surprising — both to the upside and the downside.
The caveat to keeping your identity small is when you want to identify as a positive trait – “I’m a kind person” – so that you’re forced to live up to it, especially when this is an unchanging desire.
There’s no mention of a product here. No crass commercialism. No “pushing” anyone’s agenda. Just a simple story about the incredible power of a gift.
At times it can look like the entire financial industry is filled with charlatans and frauds. However, we forget that the honest people don’t make the headlines. These are the people that understand that managing peoples’ money is a serious affair. They aren’t messing around.
May the peace of the Lord in these troubled times comfort you and may you enjoy the holidays in the bosom of your family. May all of Putin’s missiles miss and may Santa make it through the artillery in Ukraine.
I was asked to speak at an event on Anti-Bullying Day to tell that story again. Over 1,000 people in the audience listened as I shared those two words that had paralyzed me for years earlier. And when I got done, there was a line of people that started outside of the room and ran up to the stage.
Over the long run, unsubstantiated valuations revert and perpetual motion machines stop. When this happens, the illusion of wealth bursts and the inside game is revealed. Some people end up with dollars, others end up with tokens. Choose wisely.
Instead of wasting breath on the macro headline of the day, investors would be better off focusing on understanding their current situation the best they can with the information at hand and investing accordingly.
Mahalanabis never received the Nobel Prize for medicine. I doubt that worried him, but it should give the rest of us pause. If there is no room in our stories of success for the tin can, the menstrual pad and oral rehydration therapy, then we are missing something which matters.
Lots of people have posted similar examples of ‘false facts’ asserted by ChatGPT. It often looks like an undergraduate confidently answering a question for which it didn’t attend any lectures. It looks like a confident bullshitter, that can write very convincing nonsense.
It is difficult to explain moral hazard to tenured professors or the pampered princes of bureaucracy, who beat the drum with their silver spoons in support of shifting the risk of loss to the public every time that Wall Street falls into one of its own schemes and blows itself up.
Indeed, I gather the point of the Stanford effort is precisely to regulate AI research. Which will mostly just mean China does it instead.
For big banks, operating safe deposit boxes no longer makes financial sense. But as the likes of Chase and Capital One exit the safe-deposit business, they have accidentally created an intractable problem for consumers. People still want safe deposit boxes and now it’s nearly impossible to get one.
As you might expect, vegetarians will have a somewhat rough time here. For most people in Argentina, a vegetarian is something you eat. Vegans will not survive in Argentina
We don’t look back. We don’t complain. We drive fast. We take on the Machine. People we love come and go. Times change. People die. We fly into an unknown future. Remember what you said in your recent memoir? “There’s one thing they can never take away: Nobody had more fun than I did.”
There are occasional periods when society learns that debt can be dangerous, greed backfires, and more money won’t solve all your problems. But it quickly forgets and moves on. Again and again. Generation after generation.
The rapid construction schedule ended up shaping almost every aspect of the building. Primarily, this meant the design of the building needed to be as simple and repetitive as possible.
Regardless of the number of times you air, the bottom line is this: If you don’t put a message in listeners’ ears often enough for them to retain or recall it, there is no point in airing it at all.
By 1974 mobile homes were produced by over 300 firms in 800 plants across the country, and across the country 9 million people were living in nearly 4 million mobile homes. According to Forbes, the top 3 most profitable companies between 1968 and 1973 were mobile home manufacturers
Bronte Capital (John Hempton) post originally from 2008 - but repeated in 2022 because history rhymes
You know exactly what that expression means. The markets version of this is: Don’t obsess about investing beyond the point of diminishing returns.
Fraud, money laundering, and corruption on a global scale, yet regulators seem asleep at the wheel. This has happened before...
Roulette, as an investment, is not in the range-of-good-choices. But as an analogy it fits nice. Prepare and pick from prime possibilities but remember the ball might not bounce any of those ways.
Most decisions aren’t made on a spreadsheet, where you just add up the numbers and a rational answer pops out. There’s a human element that’s hard to quantify, hard to explain, and can seem totally detached from the original goal, yet carries more influence than anything else.
The overall picture is clearーwe have enough potential sources of losses that even if some of the numbers are off here and there, it is now at least conceivable how they might have arrived at such staggering losses.
Democracy dies in darkness my ass. They are so full of crap that their eyes are brown.
Like Wile E. Coyote, tech companies ran off the cliff long ago; only now is economic gravity starting to assert itself.
Trust the statistics. Trust the rules. Remember, the ranger said one of you. Never mind the summers when there were two.
If each individual has a hard time with their own memories of what happened, how accurate can other people’s assessments of their life truly be?
These periods aren’t fun. They never are, but the good news is that in their wake something positive happens. The adversity will separate the wheat from the chaff, the three-stars with upside from five-stars without it, and those who can “handle hard well” from those who cannot
*Maybe Travis McGee had it right all along - and he was years ahead of the rest of us. - Ed.
The price of building wealth isn’t just the trouble of earning money; it’s avoiding the post-earnings urge to spend what you’ve accumulated.
The O-ring model is merely a simple way of thinking about how an economy might work — albeit one that seems packed with insight
Winston Churchill said to keep champagne cold in your fridge at all times. In victory you deserve it, in defeat, you need it. Both parties will be drinking it tomorrow for different reasons.
It doesn’t make sense to try to do everything yourself. You have to find people who are good at things and empower them to help you. You have to be strong enough to hand over the keys, to relinquish control, to develop a system—an organization—that is bigger than just us.
Today the median house price in relation to median income is at the highest level in modern US history, even higher than it was at the height of the housing bubble in 2007. It is almost double the level of the early 1980s.
There are times when tiny mistakes occur that get blown out of proportion when outsiders believe hidden agendas exist despite all evidence to the contrary. This is the story of such a case.
This brings me back to the people who each paid $700 to hear me speak. If they had paid less, or if they hadn’t paid at all, would they have valued it the same?
Deep down we know that cultural appropriation—when done right, when done well—is actually called art. And when we are not too busy looking for outrage points on the internet to look at the art itself, we know that it is actually something quite powerful and important
Zuckerberg is currently participating in the single-most expensive attempt to manifest reality and painfully failing. He is a nakedly awful ruler that can never actually be fired, meaning that he can burn this company to the ground if he sees fit.
You’re not known for your losses, you’re known for your wins.
As the world moves faster and faster, we don’t need more formulas or how-tos. We need to improve our ability to change our minds based on a changing reality and in so doing turn uncertainty into opportunity and ambiguity into advantage.
Books that, when you’ve finished them, have caused you to “pivot” your mindset. Ones that make you think in a new and more informed way.
A good meeting is a good meeting less because of what happens at the time, but because of what came before — and most importantly, what comes after.
Most problems are more complicated than they look but most solutions should be simpler than they are.
The good news for the homebuilders is activity usually picks up quickly following an interest rate induced slowdown (as opposed to following the housing bust when the recovery took many years)
I promise, we learn more from our failures than we do our victories. Our failures challenge us at our core and test us to see if we are up to overcoming what others may perceive as our demise.
We don’t have to relive our mistakes to learn from them.
Finding out how to get your needs met is not just some self-help mumbo jumbo: it’s one of the most important business decisions you can make.
Some lessons in sales and trust from the man who tried to sell the Eiffel Tower twice.
How much of your wealth is reliant on trusting external, opaque systems and complying with their increasingly one-sided, ephemeral and arbitrary policies, expectations or whims?
“You get paid in direct proportion to the difficulty of problems you solve.” - Elon Musk
When you look back at what people said in the late 1920s – their confidence, their clarity, their logic – you can’t help but wonder what we are confident in today that will look foolish in the future.
I am a hardcore capitalist because I have seen how it can change people’s lives. I am anti-socialist because socialism destroys people. It destroys society. In its most virulent forms, it kills people. That’s the debate we should be having today and no one is calling anyone out on it.
It’s what we all want to do. Which is why we were addicted to this music to begin with. We boomers remember when you didn’t take endorsements, when your credibility was everything, when you were channeling truth.
In the nineties, well-heeled investors began rolling up mom-and-pop businesses across the country, from plumbing to pest control, hoping to boost profitability by providing economies of scale. The result has been baleful for small towns.
Labor or capital without a mind behind it is useless.
Seventy-five years on, some details of the disaster still remain a mystery, however. Was sabotage to blame when a suspicious radio message warning of sea mines reached the command bridge, just before the first torpedo hit?
My favorite career advice
Novelist William Maughan said there are three rules to good writing. “Unfortunately no one knows what they are.” I actually think there’s one: write the kind of stuff you like to read. Writing for yourself is fun, and it shows. Writing for others is work, and it shows.
From scary phone call through world exploration to her last hospital check-in, she wrote just 20 tweets. 289 words. 1640 characters.
Art represents a $1.7 trillion asset class. That makes it bigger than private debt and about half the size of private equity.
I was basically alone. I didn’t have a team, nor an office. Some of my friends became billionaires. Meanwhile, I was running a “measly” lifestyle business. It wasn’t what I wanted to do, but I had to keep the ship from sinking.
The “harbingers of failure” study reminds us that we could equally seek customers with the opposite quality: an unerring nose for products that the mass market will despise. Perhaps it shouldn’t be a surprise that such people exist.
The game of growing a company is a game of learning and mastering new games as fast as you can, then leaving the old games behind.
He charmed everyone, from President Hoover to Greta Garbo to the journalists who put his boyish face on the covers of Time and The Saturday Evening Post. Kreuger favored perception over reality. He believed financial statements were an art, not a science.
Most people don’t (and can’t) know exactly what caused their own successes and failures. So even if you ask them for a roadmap, they might lead you down a different path than the one they took themselves.
Memories are important not only for learning and remembering but also because they form the basis of what we can imagine and create. In so many ways, we are what we remember.
Misinformation doesn’t thrive because we can’t spot the tricks. It thrives because, all too often, we don’t try. We don’t try, because we are confident that we already did.
I think it’s super important to know what we’re striving for and why. Some of us want to ensure a comfortable retirement, others want to get rich. But ask yourself what does rich mean.
People ask us why all the time. Why choose profit?
Seeing patterns among randomness and feeling safe among the familiar are things previously noticed by psychologists.
Today, we throw the word “Nazi” to describe people we disagree with way too casually. I think it cheapens the memory of the people the actual Nazi’s murdered, and cheapens the effort it took to dislodge them from power.
Extraordinary performance comes from being different.
And then for some of us, it’s life week to week, day to day, or moment by moment. The Below the Surface stuff that’s buried down deep, in the dark. The stuff we hide. That we obfuscate. That we share with few people or no one at all. And the deeper you go, the darker it gets.
The reason companies fail, and empires collapse is simple – they become arrogant. They forget that their success was earned by sweat and paranoia. They start taking it for granted. They become fat, lazy, and happy. Just like companies and empires, the US is not absolved from the laws of economics.
The irony of history is that it’s mostly the study of things changing, often used as a guide for what to do next.
Now, nowhere is it written that the media need be accurate, or useful. They haven't been for most or recorded history. So, now they're speculating... so what? What is wrong with it?
This is just using your taxes to rent votes. Nothing more.
It isn’t about proving you are right or forcing anyone to do anything. It’s about inviting them to. About creating the conditions where a “yes” is inevitable for the right person, at the right time, in the right place.
The mere existence of Buffy proves the declinists wrong about one thing: Hollywood commercialism can produce great art. Complex and evolving characters. Playful language. Joy and sorrow, pathos and elation. Big themes and terrible choices.
Never forget, no matter what you do you are human. There are costs and opportunity costs associated with every decision you make and every action you take. They are different for everyone.
If you ask yourself what you spend your time on that’s bullshit, you probably already know the answer. Unnecessary meetings, pointless disputes, bureaucracy, posturing, dealing with other people’s mistakes, traffic jams, addictive but unrewarding pastimes.
I don’t say everything I’d like to. Not any more. There was a time when I could tweet or write anything about anyone and feel good about it. When you’re the little fish in the big pond you don’t have anything to lose.
Why do we prefer to deal with business problems as puzzles rather than mysteries? Because it's easier.
And then he gave me a little rule that has stuck with me always: Work, family, scene. Pick two.
If you’re a small business owner and you take this checklist, apply it to your business, and begin getting to yes on more and more of the questions, you will (1) build a stronger, more durable enterprise and (2) substantially increase the long-term value of your business.
A determined founder began Guinness with a vision and took a bold decision with a 9000-year lease. The company then started a brewery which defied nearly every norm in workplace relations.
We are all individually the answer, in the choices we make. What we need from you now is what we’ve always needed and talked about here: Courage. Self-discipline. Justice. Wisdom.
Slow progress amid a drumbeat of bad news is the normal state of affairs. It’s not an easy thing to get used to, but it’ll always be with us. - Morgan Housel
An asset you don’t deserve can quickly become a liability.
Understanding cause and effect is the biggest problem facing society because it touches every part of our lives. Health? Politics? Economics? All of these, and more, involve making causal arguments around systems that are highly complex.
Why moonshots matter
“Education is the most powerful weapon which you can use to change the world.” — Nelson Mandela
Every building, no matter whether it is housing a resort hotel or an attraction, has a specific shape designed to prevent standing water from collecting on its surface.
As wonderful as it would be if there was no such thing as death, we have to use death as a tool, we have to use it as a spur to move us forward, we have to use it as a reminder of what’s truly important and we have to be made better for the fact that we don’t know how much time we have.
Speculators and rodeo stars are cut from the same cloth; we only get paid if we win. You get tossed off and you get nothing but the bumps and bruises and hopes you will hold on for the next ride. Where else do entertainers not get paid for performing?"
There is never enough money, if you can’t see the riches in front of you.
Accepting a little pain has huge benefits. But it’ll always be rare, because it hurts. Same as it ever was.
Preparation is the key to everything—if you prepare for financial independence, you’re laying the groundwork to avoid being overruled and forced into uncomfortable situations because you need the money or because other people know you need the money.
The lawsuit brought by the brothers against Ford became the legal basis for the idea that companies exist primarily to generate profits for shareholders, setting the stage for the aggressive rise of the American corporation.
Facebook, Twitter, and YouTube are radicalizing us for profit, but it’s not in their ultimate long-term interest to crater our economy or degrade our world view … too far. Smart parasites keep their hosts alive.
Governments can outlaw the riskiest activities, while allowing free choice to prevail elsewhere, bolstered by firm guidance. The more clarity, trust and social solidarity there is, the more likely voluntarism is to work
Ironically, a man who had never gambled before had unintentionally built the Strip’s first casino complex, and set the model for future developments: a self-contained and luxurious resort along a highway — where no one worried about using the right fork.
Dollar Shave Club is a textbook example of how the new Internet economy will destroy value in incumbent industries.
This is not just a lesson for individuals to unlearn, but one for society to unlearn, and we'll be amazed at the energy that's liberated when we do.
When people ask, “What are you preparing for?” you’ll say, “A world that history shows is both a growth machine and a continuous chain of unforeseen agony.” A world where we have no idea what will happen next. Nothing more specific.
The more software that is centrally controlled and built into cars, the less control that owners have over them. Cars used to mean “freedom”. When you got your license, it was one small step to independence.
Perhaps your boat is on course, and you are enjoying the journey. But sometimes the thing that we think is holding us up is actually holding us back.
The truest material for making new things isn’t aluminum or carbon fiber. It’s behavior. And today, our behavior is being shaped and molded in ways both magical and mystifying, precisely because it happens so seamlessly.
People want egalitarianism when they’re being selected, but they’re elitist when they’re doing the selecting. This is the ultimate luxury belief: wanting average for everyone else while wanting the best for ourselves.
Does Waffle House also have a focus strategy? I think so. They do not try to appeal to everyone. Someone admitted on my Twitter feed that they went to a SEC school and have never visited a Waffle House, which I believe is a crime in some states.
There are places where the veil of the past is thin, and they have power. We’re drawn to them, but we can only examine them superficially before we realise the truth: we can’t ever get back there, but nor can we ever be free of the yearning to.
Why don’t they know getting things fixed is all about tomorrow? Until then, lots of people just need to get through today.
Now, I understand some people would dream to be in that position. But at the time, I just felt trapped. I couldn’t stop, but there was only so much I could do as an army of one.
Here’s the thing about telling a really good story. It doesn’t matter how bad it was or how much it cost or how big of a mistake you made or how much it hurt or how stupid you felt. Given a chance, you would never change a thing.
I know what happened. We all forgot. We all forgot what real problems look like.
The White House, the American left, the media (which is redundant, I recognize), and the financial press refuse to recognize this reality because it is not fashionable to speak ill of the economy.
This is not a bad thing. Learning how to behave in public is something millennials should have mastered in kindergarten. That they haven’t has been an ongoing problem for our society. Let’s hope they learn it now.
The most powerful political statement ever made in the history of mankind. It is who we are and why we are who we are.
After thinking about this idea more, I started to wonder whether I practice what I preach on Of Dollars And Data. Has my work been consistent with how I built my wealth?
After the introduction Jim asked if they wanted to participate in his project and instructed those who did to complete three sentences: I am… I regret… Before I die…
My sympathies to his loved ones, and to his millions of fans trying to make sense of the inexplicable. His was a truly unique voice, and I'll be among those who miss it. - Mike Rowe
Startup stories especially are long on ra-ra-ra!! independence, make your own way, be your own boss, change the world…and yet remain silent on what happens afterwards.
What? You thought this was going to be easy?
We are just passing thunder clouds, lifted by shifting substance, full of lightning for a while.
Retirement systems are so interesting because what happens to them is always the canary in a coal mine for the larger economy. They reflect everything about our ability to save, redistribute, plan, and deal with risk.
There are three important facts about bullshit: It’s everywhere, it’s influential, and it’s dangerous.
The fact remains that far too many of us are afraid. Afraid of looking foolish, afraid of what other's may think, and sometimes, we're just afraid for no reason at all.
Everyone’s dealing with problems they don’t advertise, at least until you get to know them well. Keep that in mind and you become more forgiving – to yourself and others. -Morgan Housel
Doesn’t it seem silly to analyze a rap song for ideas on how to be better at persuasion and influence? I don’t know. You tell me.
Yes, after seventy years, Mister Potato Head has been dragged into the future stripped of his gender allowing his owner to assign the appropriate gender. This is exactly why we are a great nation. We care about the gender implications of plastic potato heads.
Theories of maybes can often be distilled into probabilities. But this doesn’t solve the problem, because we can’t calculate the probabilities of things we don’t know. The history of markets is, and will always be, the story of things that were unprecedented until they happened.
Are things actually more stupid today, or were they always stupid and we’re just more aware of the stupidity now?
“Think of how dumb the average person is and then realize that half the people are dumber than that.” - George Carlin
We can never forget them. There was only one European D-Day and I will let historians argue about its significance. There are not too many left that fought in either Europe or the Pacific. Treasure them while they are still here
The obvious story is the collapse of print and the growth of internet, but more interesting to me is the decline of the top line: US advertising has shrunk by a third as a share of GDP.
Everyone is pessimistic and fearful at the moment. Doesn’t matter what country you’re from or what side of the political spectrum you’re on. To everybody, everywhere, it feels as though shit is hitting the fan.
Even the world's best investors are not immune from making mistakes. Come find out why.
You’ll try tough love. You’ll try the opposite. You’ll try … everything.
Omaha is a good town. The College World Series is there and there are some big companies based there. Believe it or not, there are hills there.
Ultimately there will be as many last times as there were first times. There will be last time you do laundry. A last time you eat pie. For every single friend you’ve ever had, there will be a last time you talk, or maybe there already has been.
This emperor, his minions and his consultants do not like his lack of clothing to be pointed out.
The 21st century has been the century of the intangible economy, and little has happened in the last two years to suggest otherwise.
Every goal you dream about has a downside that’s easy to overlook.
We don't all value the same things. It just takes some of us a long time to realize that not everyone is playing the same game.
The pivot away from mobile home park development over the last 35+ years is resulting in damaging, unforeseen consequences.
COVID has shown many of us a lesson in humility, in that anything can come out of the blue that significantly hurts our tangible assets, our wealth and portfolios. But Chris shows us that we still have our intangible assets, our expertise, experience, network and reputation
A house is a place to live. It’s a place to make your own. It’s also a form of consumption more than an investment opportunity for most homeowners. A house can still pay psychic income which is probably more important when it comes to your happiness.
“I’m spoiled – it’s terrible, I’m used to living a good lifestyle, and I’m a very big spender.” -Bill Foley
Math is hard, let's go shopping.
Ireland’s housing bubble and bust has become emblematic of what not to do in housing debates around the world. The only problem is nobody agrees what actually went wrong.
Millennials have real paychecks to spend, and stock trading fees have all gone to zero. Trading has become gaming.
The Financial Times had an article on ESG this morning saying that companies cannot ignore it. If I were on the board of a company, I’d definitely tell them to ignore it.
There are so many reasons folks get a pass, from the friction it takes to replace them to the shockwaves it would potentially send through the organization. But none of it is “because we couldn’t live without them.”
The new model turned the questions around. It started with a problem and asked textile makers to solve it. The problem wouldn’t be about the cloth but about the wearer’s body.
The way we see it, Netflix is but one of the grossly overvalued growth stocks that have succumbed to gravity in recent weeks.
The problem with thinking we can resist temptation is that we have no information on what it actually feels like to be in that situation.
Regulatory capture by Russians in the West elevates capitalism over democracy, and that has implications beyond foreign influence. Each football club and villa purchased by oligarchs moves us down the path to cronyism and our own oligarchy.
Wall Street may (or may not) need new storytelling. But we do as a society.
People get information and decide for themselves. There is personal responsibility associated with those decisions. Instead of “one size fits all” it is different. You are free to choose, and you have to tolerate people that might not agree with you.
It is easy to assume that if you haven’t experienced something, it will never happen. However, this belief is another example of the bad generalizations that have become the hallmark of this era.
A big question on my mind, just how can we reform our political system so economic reforms can happen – especially clearly sensible reforms that both parties understand.
The thing is, money has expectations.
It’s probably worth spending some amount of effort on pushing back to keep open the window of free expression. My hope is that this essay will help form social antibodies not just against current efforts to suppress ideas, but against the concept of heresy in general. That’s the real prize.
According to Acker’s data, Italy's wine value increased the most, 7.03%, and California had a decrease of 2.04%. Poor California. They can’t get anything right.
In 2021 Apple had a 26% net profit margin and an effective tax rate of only 13%, while the oil industry had an average profit margin of 8.9% and an effective tax rate of 26.9%. Yet Congress “investigates” price gouging every time gas prices go up.
That dog knew a truth which evades the rest of us: he had everything he needed, and it was enough.
I know some of you will say “Just ignore the status game altogether,” but this is easier said than done. Like many other animals, we are biologically wired to respond to status. Ignorance is not the way out.
“A business as successful a Doordash and worth billions of dollars would clearly not just give away money like this.”
… these are the little lessons that stayed with me, a map of the world I keep folded in my heart.
Whether we view maintenance as a vital ritual, a kind of meditation, or a tiresome chore, it is inescapable. Without it, everything falls apart.
The best knowledge is often local, not global. The real causes of success are often hidden from us. Therefore, trying to explicitly describe the knowledge of how to be successful in a given field can be very difficult.
My guess is that more than half of all disagreements – personal, domestic, international, financial – would disappear if you could see the world through the lens of your opponent, and had experienced what they have in life.
That world lies in ruins around us, wrecked by a storm of change. To evolve and endure, a frame of reference must enjoy an intimate relationship with the environment.
Look instead at the 1978 to 1982 period for lessons
Ezra Klein has a must read interview of Larry Summers. One of Ezra’s questions is interesting. No, “interesting” isn’t quite right, it’s the single most revealing question I’ve ever seen from a reporter in my entire life.
Innovation is inherently risky, and most projects fail. The thinking is that the wisdom of the government can remove risk from the innovation process, or it can handle the risk better than the market can.
The IMF gives out money. Lots of money. Gobs of money. And, the US either directly provides it or provides an unequivocal guaranty from the US Treasury which means American taxpayers.
The question is always “Do you bet on the jockey or the horse?” That means the people or the idea. The answer is, you always bet on people. Always.
Much of what you do today (or don’t do) was decided by the person you were years ago, a person with less life experience and less insight into your values.
The economic metrics are awful. Despite nominal GDP gains and higher wages, inflation, largely driven by energy prices, has been particularly cruel to minority and working-class voters.
The stars of this clown show are clueless, incompetent bullshit artists, and fraudsters who con the rubes in the advertising and marketing industry out of tens of billions of dollars annually without the slightest risk to themselves
It seems things will be uncertain for a long time, but the good news is we have more tools to deal with the risk that creates.
What happened over the past few weeks was nothing less than the end of the Post Bretton Woods era. That’s not me calling it, others have already done that. I’m agreeing with it.
The Nonsense Gap is “that moment when you’re about 90% of the way through a project you’re about to put out there, when all of a sudden you start doubting…absolutely everything.” And you consider quitting (and sometimes, you do).
One of the greatest gifts you can get from a place: the feeling that you’re allowed to be yourself when you’re there.
The Ukraine war is at the front of the news, and all of a sudden, to take the headline words of James Freeman’s Wall Street Journal column, it’s springtime for the Clintons. Something is going on. Something stinks here. Something’s raining.
The United States was once upon a time energy independent and then Joe Biden was elected.
From free speech to “spheres of influence” to our passion for endless war, we’ve become the doublethinkers 1984 predicted
We long ago reached the doublethink phase predicted by Orwell, where most of the population is conscious of double standards but ignores them effortlessly.
So you think you understand how a field works until you experience a new part of it firsthand. Then you see it through a completely different lens.
Green people are out of touch with reality. When the wheel was invented in the Stone Age, they’d have kept dragging things around.
Americans have become intolerant of many risks that people once dealt with on a daily basis, as the Covid-19 pandemic has shown.
Some 20 years ago Europe (and the “West”) had the North Sea, which produced as much as Russia and the US. Today, the North Sea is a shadow of its former self. And if US shale continues to disappoint, it won’t be long before Russia becomes the world’s biggest oil producer “beyond reasonable doubt”.
History is just a long story of the unthinkable happening, precedents being broken, and people reading the news with bewilderment and denial.
Today we are close to 1939, with Germany’s invasion of Poland and the start of what later became known as WWII. Except that it seems that Europe, acutely aware of its dark history, has finally woken up.
I am sitting in my comfortable armchair, with my headphones on, drinking coffee as I write, while somewhere in Ukraine, people just like me are being bombed by Russian artillery.
By pushing Russia into the arms of an ascendant communist China, the West, and the so-called “adults” who are back in charge, have made a geostrategic blunder of historic proportions.
Pilots use multiple dials, employing different sources of energy, to report identical data, because they understand that in a dashboard full of information, something is always lying to you.
Knowledge spreads, technology diffuses, and arbitrages disappear. Markets asymptote towards ever-greater efficiency. This process is extremely well known in capital markets, and even has a name: ‘alpha decay’.
This is one of those world events that you can imagine a documentary of the future opening with: “It all started when…”.
Pandemics happen. Wars happen. If you’re of that ilk, climate risks happen. Sovereign debt collapses happen. Crises are always unpredicted. If they were predicted, they wouldn’t be crises. So, dear Fed, well done. The house was on fire, and you sent the entire fire department and put out the fire.
We made many policy choices that threw gas on the fire to prevent economic hardship and give some people a small windfall for their trouble. Maybe that was a good decision at the time, but now we are living with the consequences. And perhaps there is worse to come.
Bradbury predicted that people, disturbed by confusing or challenging ideas, might one day demand censorship for themselves and protection from any information that pierced the veil of their own simplified reality.
The attack on civil liberties is escalating rapidly
If the government, or political pressure groups, can stop you from being hired, you cannot speak, you cannot assemble, you cannot act politically. Communist countries didn’t need to put people in jail.They could just stop them from working.
“Climate change” is one of the pillars of the central planners’ agenda.This is a broad pillar and designed as such because it allows incredibly sweeping mandates that can all be brought under the already broad and increasingly widening umbrella of “climate”
When most people think of the tech investments during World War II, they think of the atom bomb, or maybe advancements in radar and sonar. But the war also accelerated penicillin development, which probably saved millions of lives through the end of the 20th century.
Are we not even possibly heading towards another Fannie and Freddy, only this time subsidized green boondoggles?
Putting ideas into words is certainly no guarantee that they’ll be right. Far from it. But though it’s not a sufficient condition, it is a necessary one.
One way that first principles thinking fails is when you build your analysis up from a deficient set of base principles. Everything is correct and true, but you still end up mistaken. Here’s how that looks like in practice.
Here’s a NY Times piece calling for a MMT “victory lap”, with an asterisk. It’s an interesting article, but the asterisk seems to be doing an awful lot of heavy lifting here.
His identity was long unknown—until the FBI arrested him earlier this year. Now everyone in the publishing industry is asking, What motivated him?
Most people don’t realize is that logical fallacies—that is, errors in judgment and reasoning—are incredibly common in day-to-day life. Worse, we’re mostly unaware of how they disrupt and harm our lives, often in profound ways.
GoFundMe just made the use case for Bitcoin undeniable to everybody. At the same time, they gave you a preview of what life will be like if you ever become reliant on Central Bank Digital Currencies (CBDCs)
Bureaucracy is also a technology. Think about that for a moment, nobody is responsible. But is this a problem of the individual facing the decision, or is it one of the system? A little bit of both.
In short, how many roads and bridges do you get in the $1.2 trillion dollar bill? Zero.
So it comes down to these (in the eyes of the media) backward, racist, infantile hillbillies, to stand up for constitutionally guaranteed human rights that most Canadians are too cowardly or sycophantic to demand back.
I believe this is one reason our modern lifestyles can feel a little self-defeating sometimes. In our search for fulfillment, we keep paying first prices, creating a correspondingly enormous debt of unpaid second prices.
I often say that I am glad I am getting old, and on the downslope of a long academic career. I can’t imagine beginning an academic career today.
The union model worked well when firms and workers were more similar. Higher productive workers throw their lot in with the less talented, and everyone received a similar wage in exchange for stability and a seat at the table.
The diner is sort of like an oversized living room, where people join into one another’s conversations between bites of scrapple and sips of hot coffee, shouting across the room from time to time.
So I spent three years in law school and was pretty good at it. I still had no idea what it meant to be a lawyer.
You spend years trying to learn new stuff but then look back and realize that maybe like 10 big ideas truly changed how you think and drive most of what you believe. - Morgan Housel
History doesn’t repeat but it often rhymes. I don’t know if it was Einstein, Twain, Munger or someone on Instagram who originally said this but it’s certainly something market people say all the time. -Ben Carlson
Let’s get the most important bit out of the way first: civilians think that a mortgage is a loan between a bank and a customer, and think of it primarily as services work (to the extent they think of it at all). This is a materially incorrect worldview, ...
Student loans are packaged together and then sold as financial securities, just like auto loans and credit card debt and home mortgages. These asset-backed securities pay a return to their investors as the debts are repaid.
Before it moves on to climate change, inequality, and racial issues, the Fed should have to think just a little bit about the evident failure of its existing financial regulation.
Let’s compare what happened recently in women’s tennis with what happened two years ago in the NBA. -Malcom Gladwell
Humans overall suck at logic. We have the capacity for logic, but it is only one of many algorithms running in our brains, and often gets lost in the noise. -Steven Novella
We all played this game when we were kids.You say a number. Your friend tries to demonstrate his knowledge by saying a bigger number.At some point you proudly get to infinity – the largest number of all.-Vitaliy Katsenelson
These are crazy times.
We weren’t what magazines would one day call “early adopters” of technology. The opposite.
Herman Melville spent several weeks as an involuntary guest of the Typee, Marquesan Islanders known for their fierce cannibalistic ways and their exquisite tattoos.
A good CEO is always hiring and a great CEO is always looking for talent — talent spotting.
A common cause of everything from divisive arguments to bad forecasting is that it can be hard to distinguish what’s happening from what you think should be happening.
By defining what enough means, you’re giving yourself a concrete barometer to judge your desires by, and whether or not they are worth having. It’s the best way to tell your future self, “Hey, don’t forget where you come from."
There’s a lot of research done on money and happiness, and I’ll get to it, but first I want to share with you about why I don’t think money alone buys happiness.
Congresspeople never take risk. They don’t understand those of us that took a lot of risk for a living. We didn’t get “lucky”.We had a unique skill and understanding of the world.
Every morning, there it is, waiting for me on my phone. The bullshit. It resembles, in its use of phrases such as “knowledgeable sources” and “experts differ,” what I used to think of as the news, but it isn’t the news and it hasn’t been for ages.
Financial literacy is one of the most critical things an artist can have. But it seems scary. It’s scary understanding my fault in all this – in acknowledging my overspending.
This is a short guide to some questions that you should consider before meeting with your genetic architect. If you intend to combine your genetic material with others, we encourage you to discuss these questions with any co-parents in advance.
What does it mean when Google, Microsoft or Apple turn your whole company into a feature? When do we let a tech giant build and when do we call the anti-trust lawyers? And what does that mean for Spotify, Yelp or printing in landscape?
I had been brainwashed into believing that Americans – capitalist pigs – would sell their brothers to supersize their happy meals. Now, these cold-hearted capitalists had taken their time and money to care for people they had never met.
Inflation continues to surge. From its inflection point in February 2021 to last month, the US consumer price index has grown 6% – an 8% annualized rate. -John H. Cochrane
I am hereby declaring the Year 2021 to be over. It has been a terrible year surpassing 2020 which was a bloody hard act to follow. -Jeff Minch
This is a short story about what happened to the U.S. economy since the end of World War II.
The first signs that something strange was happening occurred on Christmas Eve.
If you owned a home prior to 2020, you’ve made out like a bandit, with higher asset values and lower debt payments. If you’re in this situation, consider yourself lucky. But if you’re in the rental market or trying to buy your first home, you’re experiencing a painful bout of inflation. -Ben Carlson
Unlike cryptocurrency, though, NFTs are one of a kind: non-fungible means that they’re not interchangeable with each other. This makes each and every NFT unique, in contrast to cryptocurrencies where each unit or coin can be exchanged for another—much the same goes for real-world currencies, too.
You probably spend most of your time thinking you have an objective grasp of reality. You weigh the issues. You approach things rationally. I feel the same way. But every once in a while I get a reminder that things aren’t always as they seem.
A “risk to the financial system” does not mean that someone, somewhere, someday, might lose money on an unwise investment.
The point here is that history doesn’t always perfectly line-up with what we read. And much of history is being re-written on a regular basis as stories, context, perspective and research methods change over time.
The sale technically made Pak the most expensive living artist in the world, but many are still trying to wrap their heads around exactly what Merge even is.
These were not men who saw their job as being an exercise in social engineering; they saw their job as being to win wars.
Managing expectations and getting the goalpost to stop moving is one of the hardest tricks in life. But it’s so essential.
I think that people really don’t understand risk, how to quantify it, or how to manage it. Sometimes you have to accept it and you can’t do a thing about it.
In 1989, in one of the more unique business deals in the history of consumerism, Pepsi and the Soviet Union struck a deal for the communist country to provide the soft drink provider with $3 billion worth of warships: 17 submarines, a cruiser, a frigate, and a destroyer.
That’s not to say that capitalist democracies can’t run off the rails, but typically with enough dissenting voices, the worst outcomes don’t usually take place. There are exceptions though.
Why did they trade with an authoritarian regime and send millions of American manufacturing jobs off to China thereby impoverish working Americans? Because it made them rich.
The forgetting curve suggests that we tend to halve our memory of new knowledge in a matter of days or weeks, unless we make a conscious effort to review the newly learned material.
Whatever it is. However poorly it went. However difficult 2022 has been for you thus far. Be grateful for it. Give thanks for it. Say yes, thank you for it. There was good within it. Write it down. Over and over again. Until you believe it.
Why are Governors allowing a downtown to be burnt before they rise to save the ashes? Why wait? Why patrol the ashes?
The best kinds of Southern accents infer in their very construction that whimsy, beauty and grace are possible in an otherwise tragically dull world.
Vishal Khandelwal recently wrote that old guys don’t understand tech, but young guys don’t understand risk. Another way to put it is: everyone has something to teach.
What is important to people is individual. But, you have to be totally and brutally honest with yourself about it. If you aren’t, you will lead yourself to a bad decision.
Two things are striking about this math. First, even though half of what you paid, including tip, went to the people working at the restaurant, no one got rich from that half, and almost no one got health insurance.
Sometimes amateurs believe they are professionals, but professionals never believe they are amateurs. Professionals know they are not playing the same game as amateurs.
Innovation is always changing, but psychology is timeless, so understanding how we reacted to the arrival of the car and the plane sheds light how we’re likely to respond to breakthroughs today and tomorrow.
It was one of those rooms where I kind of understood that if I said butterfly I was probably getting beat up, so I was like, “All right, I’ll pick a skull.” So he tattooed this little skull on my leg, and I was thrilled.
It seems to be a constant throughout history: In every period, people believed things that were just ridiculous, and believed them so strongly that you would have gotten in terrible trouble for saying otherwise. Is our time any different?
Joe had famously asserted that he had had nothing to do with his nefarious son’s business dealings with amongst others, the sovereign nation of China. What did candidate Joe Biden do? He pimped some EXPERTS.
So what’s the takeaway here? What can we learn about ourselves? How about a small set of rules? But until you’ve walked through the fire yourself, you won’t really know why you need these.
Memento Mori. Remember we are mortal. It’s a constant theme in art because it’s a fact that’s as easy to forget as it is scary to think about. It’s unpleasant. And besides… given all our modern advancements in technology, isn’t it a little fatalistic? Isn’t there a chance we may live forever?
When most people in a country have problems buying food or paying rent, the result is a toxic situation for a society that can quickly turn into riots and civil war.
He likened the move to Netflix’s decision to start making its own shows, rather than relying on Hollywood studios for its content.
In honor of the 10th anniversary, I thought I’d remind people what happened. We shouldn’t let things like this sit in the dustbin of human history. There is a surprise reward for you at the end too.
I can live in a world wherein morons pay for this crap. No problem with that, but you cannot make me care.
That’s the kind of song that gives you super-stardom ubiquity; that’s a Bonnie Raitt song you hear everywhere. But there was another one, too, one that shouldn’t have been a major radio hit yet became one anyway.
It is one thing to grow a lot when you are transitioning from a poor to a middle-income country, but maintaining status as a very rich country requires market discipline and constant innovation – and the price of that is the odd recession where people lose money, and then people lose elections.
Despite the fact that this book was published right after World War II, I found myself discomforted by how little we have learned from the mistakes of the past.
We don’t want to break each other’s hearts, but sometimes we have to. No hard feelings. Seventeen years of an honest partnership is at stake. I’ll give it my all and level with him.
Accidents and chance push the world in ways that are impossible to predict. One damned thing after another. Sometimes those changes happen literally overnight. So what happens when the world lurches but opinions lag?
McCabe was investigated for his actions in leaking confidential information to the New York Times about the Trump Dossier that at all times pertinent to the charge he knew was baloney.
When juxtaposed in the real world, defining what constitutes “personal gain” has been immensely challenging.
Are you and I operational? Are we cleared, even if only in our own minds, to fly or trek or sail into combat, even if that combat is only against our own Resistance and the problems of our work?
I put out a series of polls, asking simple (but not necessarily easy!) questions about well-known historical events and when they happened.
During the last five minutes of the meeting, just as I was about to accept the fact that someone had asked me to attend a meeting where I offered zero value, I realized why I was there.
Imagine you are in 1998; this new internet thing is complete chaos; it’s the Wild West. Wild West because there are a lot of possibly very profitable and certainly disruptive business models emerging.
Even though we’re getting older, we would like to assume we’re still hip and minivans just aren’t hip. So the majority of people with young kids these days now drive SUVs. Those SUVs are only getting bigger, as evidenced by the gargantuan new Wagoneer.
The biggest reason to fear higher inflation is if expectations become unanchored, and that’s a serious risk – and the Fed is playing with fire when it comes to its credibility.
I’m a hustler and a hustler got to hustle. It started as a side hustle, but my recent success — sold five paintings for $75,000 each this week in Los Angeles, fucking Van Gogh never hit a lick like that, am I right? — has turned it into my main hustle.
Success has a nasty tendency to increase confidence more than ability. The longer it lasts, and the more it was tied to some degree of serendipity, the truer that becomes.
This exercise wasn’t meant to scare or alarm. Mostly it was just an attempt to shift my perspective, take stock, and be realistic about what I have to work with.
Everybody — meaning anybody with a functioning brain — acknowledges that the scourge of inflation is loose in the land.
A way to understand the relative growth in the 21st century is to look at another time in New York history when the population grew rapidly while maintaining relatively affordable housing prices.
All you need to know is transactions will become easy and cheap, just like communication did over the past decade. Costless Transactions mean in 10-20 years, we will be making 100x more transactions per day than we are currently making.
Evergrande has disclosed that ICBC is one of its principal bankers, although relative to its overall size the exposure is small. The bigger risk is that ICBC and other Chinese banks suffer contagion via a deteriorating real estate market.
The hostility of the Biden administration and pressure from green-leaning investors has discouraged petroleum companies from expanding drilling. Meanwhile, California is running its own experiment in green energy adoption.
Much of this comes from the growing pains of an economy in a transition. We are becoming a tech economy instead of an industrial one.
If you live in a high tax state like Illinois, New Jersey, New York, Minnesota, Massachusetts, or California you probably have similar stories. The question is, how do you make a decision to pull the trigger?
You may fairly argue that “Earnings Before Interest, Taxes, Depreciation, Amortization, Marketing Expenses” has been mumbled before. Fair play to that, but the way this company throws the term around is breathtaking — well my breath at least is taken.
All history is the study of what’s changed, but it’s often used as a guide to the future. The irony is overlooked because the idea that if we gather enough data and read enough books we’ll acquire a map of the future is so seductive – it’s so simple, and makes you feel great. That will never change.
How you perceive and value time and money will change many times throughout your life, but at the end there’s only one you’ll want more of, would give anything for, but it won’t be available at any price. Cherish it while you can.
Am I happy with my Apple experience? No, I am not happy. But every single person I worked with did all they could to help.
Investors and operators are often deeply misaligned: investors think in bets, while operators think in consequences. The relationship is tense, but can be explosively productive. The VC model is an institutional expression of this tension.
It seems crazy to me we are debating the politics of how a budget will get passed and not what’s in the actual bill.
This month, Carreyrou’s book about the Theranos saga, Bad Blood, was released. It reads like a page-turner in the finest tradition of Michael Crichton, complete with secondary and tertiary characters and finely detailed scene settings, with the tragic difference that everything in it is true.
Criticism is futile because it puts a person on the defensive and usually makes him strive to justify himself. Criticism is dangerous because it wounds a person’s precious pride, hurts his sense of importance and arouses resentment.
We don’t get to succeed privately. It’s ironic, the Stoics would say, that for all our selfish cares about ourselves, we seem to value other people’s opinions about us more than our own.
Even before the Covid-19 pandemic, family formation and birth rates were declining throughout much of the world, not just in most of the West and East Asia, but also in parts of South American and the Middle East.
The cost of friendship is whatever it costs to maintain your friendship — and it’s worth it. Pick up the tab. Take the trip. Send an oak tree. Even if you’re just doing it for your own well-being.
We love to celebrate the rich and famous. Our culture cares about winning, and that’s the only thing that matters.
“Businesses have never done as much hiring as they do today. They’ve never spent as much money doing it. And they’ve never done a worse job of it.” -Peter Cappelli
We have seen countries move backwards for decades. Growth risk is an order of magnitude larger than climate risk.
I’ve put together my own affordability index - since 1976 - that is similar to the FirstAm approach (more of a house price index adjusted by mortgage rates and the median household income).
As we age, it becomes increasingly clear that talent only gets us so far. Whether it is in sports, school, business, investing, or countless other competitive pursuits, the increase in the concentration of talent makes it more difficult to differentiate ourselves on talent alone.
Privacy is coming to the internet and cookies are going away. This is long overdue - but we don’t know what happens next, we don’t have much consensus on what online privacy actually means, and most of what’s on the table conflicts fundamentally with competition.
If we’ve learned anything the last few weeks, it is that we don’t get wiser with each generation, we just repeat our mistakes. I wonder if the great moderation was a fluke, a golden era of good monetary policy we can’t sustain because we are too human.
New homes of half a million dollars and up were just 3% of sales in 2002 but nearly 30% in June of this year. There is an obvious trend of new homes being built at higher price points.
Today, class drives Californian politics, and Newsom is peculiarly ill-suited to deal with it. He is financed by what the Los Angeles Times describes as ‘a coterie of San Francisco’s wealthiest families’.
Nobody really knows for sure where these Tethers are coming from or what happens to the assets backing them from which they are ostensibly reserved. Nobody knows for sure if newly minted USDT have any backing at all.
If you want to see the future of B2B software, look at what Excel users are hacking together in spreadsheets today.
When you remove friction, more people default to either hyper-targeted “if” options, or default “else” options. When this happens, you get winner-take-all effects, or at least winner-take-most, in the “else” category.
The tension between ordinary and special world is irresistible. But, what if this way of organizing story is wrong? What if the stories we tell could be more interesting and captivating? What if the stories we buy are wrong for us?
What is the real world implication of Afghanistan on the China - USA relationship and, in particular, Taiwan? Read about it here.
I just spent the past week it the Bay Area, and it’s hard not to come away with an acute sense that there’s something wrong with the way that housing is working in the new economy
Ransomware is proliferating across America, disabling computer systems of corporations, city governments, schools and police departments
No matter what the world looks like today, and what seems obvious today, everything can change tomorrow because of some tiny accident no one’s thinking about.
If we assume a 10-15% real inflation rate going forward, half of the world’s wealth will evaporate within the next ten years.
Scott Alexander's Adumbrations Of Aducanumab is a great review of FDA snafus – with deeper lessons about regulation in general. Yes the outcome is dumb, but incentives are to blame. That’s important to understand if we are ever to fix this mess.
The US has the most innovative culture in the history of mankind. Things happen faster here. Access to capital is better here. The old cowboy mentality that settled the west permeates the tech culture of the US. Crypto benefitted from that culture.
There are some thrills in startup world that only founders can access. Ego enrichment, self-esteem nourish, thrills?
We’re headed toward a decentralized world governed by consensus as expressed through open source protocols and smart contracts. The battle is not about left vs right, conservative vs liberal where either side would have you believe that content cleanly bisects into Truth and Misinformation.
Show up as your real self! Connect with your audience! Be authentic! You do you! “The more you give the more you receive,” I believe they said at one point. Lucky for my Kool-Aid-drunk-ass-self, someone else at the event was sober and willing to touch the third rail.
We do have some problems in the US. All of them can be solved better, and faster, with unbridled capitalism. When you compare private entities with public agencies, private entities are more efficient. They turn out better results.
It’s expensive to not lose your money, but it may get cheaper…
Of all the tech “disruptions,” the platformization of housing is among the most catastrophic
Sunday evening, Kim and I made an offer on a house.
Money buys happiness in the same way drugs bring pleasure: Incredible if done right, dangerous if used to mask a weakness, and disastrous when no amount is enough.
Personal Branding is one of the most difficult things to do well in your own efforts. This is because when you are creating your own Personal Brand, you are both the Brand Agency and the Brand itself; you are the Author and the Subject.
So let me ask you this: When was the last time you ever looked at something you wrote with genuine wonder? When was the last time you beheld the joy of telling a story? When was the last time you conducted a train that anecdotally took someone somewhere?
If it seems strange to include something as small as a meeting strategy in this content, then you haven’t done the math on how much money you’ve lost on useless meetings.
So many environmental targets, so little understanding of what is involved to achieve them
What can we do to overcome victimhood? It begins with the way we educate our children. If people learn about the four components of victimhood, and are conscious of these behaviors, they can better understand their intentions and motivations. They can reduce these tendencies.
The regret these books portray is that of taking the stairs instead of the elevator. Learning by turning the page instead of the brickbats of failure and the bruises of experience. A wish that I’d been smarter sooner.
The most powerful tool on the web is still words.
A new study looks at lottery winners, which seems to be a better experiment, since the winnings are enough to approximate the lifetime fixed annuity that UBI pays. And guess what? People earn less, take less demanding jobs, and if they start a new business, it’s likely not going to be a good one
On a relative basis from where we were 16 months ago to now, this might be our roaring 20s. Enjoy it while it lasts.
Companies have long wanted spending to be fast, easy and barely worth a thought. Thanks to the miracles of modern technology, they are closer than ever to realising their desires.
If you are a politician or an entrepreneur, your number one priority ought to be rebuilding our ability to build. Fast.
It took thirty years for the volume of telegram transactions to halve, and the same amount of time for the number of horses to halve. It’s a long, slow process.
US politicians proposed five tech antitrust bills in June. They’re aggressive and ambitious, and contain some important concerns and ideas. Unfortunately, some of them are also pretty naive - case studies in not doing the work.
Just like evolution, the key is realizing that the more perfect you try to become the more vulnerable you generally are.
In a 1796 letter from French Royal Naval officer Charles Louis Etienne, Chevalier de Panat to anti-revolutionary journalist Mallet du Pan: Nobody has been corrected; no one has forgotten anything, nor have they learned anything.
In an incubator, the entrepreneur will have access to subject matter expertise that will reveal the intricacies of each element of a successful company — founding, leadership, talent, technology, marketing, finance, and the practical realities of forming a company.
When hunting waves, you’re more likely to find large, valuable ones, outside the domain of pure, traditional software.
The Lebanese are living through a terrible economic experiment, a warning to everyone else: destroy your currency and you destroy your country.
Society can’t understand itself if it can’t be honest with itself, and it can’t be honest with itself if it can only live in the present moment.
The only thing we can know for sure about the present is that it is not like the past. Charting a course forward then always requires a step into the unknown and a dance with uncertainty.
Cryptocurrencies are a clear and present danger to the US dollar. There is a very high probability that the US government will outlaw the use of cryptos as currencies. Sounds far-fetched?
Neumann’s kibbutz identity was part of his personal brand to such an extent that when puzzled onlookers spotted him walking barefoot on a Manhattan street, raising questions about his mental health, one of his publicists explained, “He is a kibbutznik.”
In a huge setback for online privacy, this week Google caved to the surveillance mafia and delayed Chrome’s much ballyhooed ban on third party tracking cookies for a couple of years.
It was easy to predict mass car ownership but hard to predict Walmart. -Carl Sagan
“Solving problems using rationality is like playing golf with only one club.” – Rory Sutherland
I’ve seen several housing booms and busts in my life. The biggest boom was the housing bubble in the mid-‘00s, and the worst bust followed the bubble.
Without knowing the history, you cannot possibly understand the importance of Juneteenth. What happened after the war and the surrender at Appomattox on April 9, 1864?
There aren’t many iron laws of money. But here’s one, and perhaps the most important: If expectations grow faster than income you’ll never be happy with your money. -Morgan Housel
As I watch the dialogue and the potential ramp-up of federal spending on lots of programs it is interesting to me how people frame it. It’s clear there are two Americas today. We see it in everything. There will be no reconciliation. -Jeff Carter
All things considered, I think TurboTax is a fantastic business, and will be tough to compete with head on. It’s more likely that the following pieces come together to obviate TurboTax.
When people think about how banks work, they often entertain a model of banks taking in deposits on one side, and lending out those deposits on the other. Although a useful representation, it’s not strictly accurate.
For most people, none of this matters any more than understanding how the device you’re reading this on really works. But if you want to reinvent the financial system, it does matter.
When I look at a lot of the social problems America is having, a lot of it boils down to breaking down regulatory barriers that stop access to capital and stop competition in various sectors of our economy, especially including education.
During the current crisis, disintermediation has been the primary driver of the post-pandemic economy. The novel coronavirus forced businesses to adapt quickly to new circumstances, and as with all economic crises, created winners and losers.
Economics is really a way to study society, behavior, and decision-making.
..., noise is what makes our observations imperfect. It keeps us from knowing the expected return on a stock or portfolio. It keeps us from knowing whether monetary policy affects inflation or unemployment. It keeps us from knowing what, if anything, we can do to make things better.
Aiden’s generation went from almost no participation in the stock market to overnight dominance of it. They have the gold. They make the rules.Millions of new brokerage accounts. Trillions in value transferred from taxpayers and the Federal Reserve into accounts at Robinhood and Coinbase.
Jokes aside, Millennial wealth seems to be on a similar trajectory as those generations that came before. For example, from Q4 2019 to Q4 2020 (during COVID!),Millennials added over $1 trillion in total net worth, which is a 20% growth rate in wealth.
Long term is harder than most people imagine, which is why it’s more lucrative than many people assume. Everything worthwhile has a price, and the prices aren’t always obvious.
Should we still be talking about online and offline retail, or about trucks versus boxes versus bikes?
Memorial Day
Good advice for a lot of things is just, “Identify the price and be willing to pay it.” The price, for so many things, is putting up with an optimal amount of hassle.
It hurts workers and retirees, disrupts investment, and can be hard to control.
The feeling of not having enough time doesn’t come from not having enough time. It can’t, because you always have zero time. It comes from the pain of valuing wishes and hopes over intentions, and what happens to you over who you are.
Young people and first-time homebuyers aren’t thrilled with the housing market at the moment.
Ending tracking, ending surveillance, ending spying on the public is not a panacea for all the problems of the digital world. But it is a great place to start. We need to get rid of tracking – not advertising – to help make the web what it ought to be.
There will come a day when investing strategies and norms that work today will grow old and expire. Two groups will form: Those who embrace the reality of the industry’s chaos and adapt, and those who stay in the tub, embracing a world that adheres to the logical rules stuck in their head.
I don’t judge books by their cover. But I do by their focus.
Some thoughts on the issue of diversity at the 4-star general level in the US military and whether it impacts readiness. It does not.
Inflation, higher taxes, world unrest, and more government intervention into the private economy aren’t in the ingredients for a raging bull market. But hey, we got rid of mean tweets.
“That’s how I played the game,” Jordan said. “If you don’t want to play that way, don’t play that way.”
Scott Galloway once said, “It’s never been easier to become a billionaire, or harder to become a millionaire.”
Every few years there seems to be a declaration that markets don’t work anymore – that they’re all speculation or detached from fundamentals. But it’s always been that way. People haven’t lost their minds; they’re just searching for the boundaries of what other investors are willing to believe.
I am not sure when the merry-go-round of free cash from the government ends that inflation will really rear its ugly head. It will take time but free-market forces should start to build more production so that the bullwhip effect lessens.
What’s keeping you up at night? What are you pondering? Share your ponderizations.
Basecamp is a software company. They build software that allows people to collaborate. I first heard of them back around 2010-11 in Chicago where they started. They were also super interesting to me …
This may sound harsh, but invoking symbolism should have one removed from any serious consideration as a fellow reasoning human being. Why? Because there is a reason for everything.
Milton Friedman’s argument still stands. In fact, it is more relevant than ever.
This corporate-backed plan will come at the cost of people’s jobs and living standards.
Although growth solves many problems at startups, unit economics is not one of them. When you’re losing money on every transaction, you can’t make it up in volume. In fact, the more revenue that a businesses with negative unit economics generates, the more money it loses.
Who might be interested in a conduit between people who have banking licenses and can interface with the real world, and people who don’t have banking licenses and therefore operate in the dark? Money launderers.
If a business is built on misleading users, on data exploitation, on choices that are no choices at all, then it does not deserve our praise. It deserves reform.“ —Tim Cook, CEO, Apple
Here’s a very simple model that determines bank profitability in markets all over the world. Interest rates and regulation both matter but the overriding driver is market structure.
What is China doing with its digital yuan? Explained by the Big Red Car, a huge fan of China. Haha. Not really.
With every stroke of his pen, and every syllable out of his mouth, Biden has encouraged less competition which is bad for Americans. Yesterday’s latest tax policy proposal is just another example.
It frustrates me that to the left the answer, as in so many issues, is always “less” inequality and “more” redistribution. What is enough inequality and when do we know when we have gotten there?
This is probably the story I most wanted to keep to myself, partly because celebrity stories tend to be shallow pits, but mostly because Heath is gone.
Your success here will depend entirely on how successfully you can tell stories, and how successfully other people can repeat those stories, both to themselves and others.
America’s adversaries have taken the measure of the new admin and are just about ready to test our resolve. I do not see a good outcome here.
Greg Ip has a great column in the WSJ on Bidenomics. It’s not long, it’s so well written that it’s hard to condense the good parts, and you should really read it all.
Can the public sector deliver growth if we have more active management?
Two major players in online media - Google and Apple - have recently announced that traditional tracking methodologies (third party cookies and IDFA respectively) would be restricted in their systems.
After price weakness since 2017, real estate looks to be a buy again in 2020 and beyond. Affordability is up with mortgage rates down.
The irony is that laws to keep poor people out are now keeping wealthy young techies out, and stopping the same neighborhoods from becoming wealthier, and thus better serviced by business and taxes.
Think about where you can be “the only.” I promise it will change your life, save your life, ruin your life, and transcend your life.
Imagine: a commercial real estate play, with properties around the world, configured as flexible office space, rentable by the hour, the day, or the month, with great community spaces, aspirational design, and strong tech. In sum, We might Work.
I wish I had some satisfying explanation about why notecards are so powerful, but I don’t. I don’t know why they are so integral (and yet used in such diverse ways) to so many fascinating people. It’s not like we’re ever taught how to use them
Doing what’s essential,” Marcus said, “brings a double satisfaction: to do less, better.” So take a minute today and ask yourself Marcus’ question. Is this necessary? Is it essential? Do I really need to do this? What if I said no? What if I opted out? What would happen?
What’s especially exciting to me about this new financing path for high-growth businesses is that it creates so many more paths to success than the all-equity model offers you.
The big lesson is to realize that you will again be hit by things you didn’t see coming, that no one was talking about, and that will move the needle more than all the things you expected to happen combined. Just one damned thing after another.
The big lesson is to realize that you will again be hit by things you didn’t see coming, that no one was talking about, and that will move the needle more than all the things you expected to happen combined.
Why are there no public toilets in America? He is right. He calls for a federal infrastructure plan to fix the problem: “Sure, we need investments to rebuild bridges, highways and, yes, electrical grids, but perhaps America’s most disgraceful infrastructure failing is its lack of public toilets.”
The absence of pay toilets is in fact a delightful encapsulation of so much that is wrong with American economic policy these days.
The logistics behind the success of the U.S. military in the Gulf War.
The way to make money investing in a back book is to value it higher than the market. Current uncertainty makes the latter harder than the former. In some ways it can be easier to predict the future than the past.
Now, I may be the only debt hawk under 45. But I’m also an amateur economic/financial historian, and what we’re seeing has ended very badly before. And we’ve never tried anything this big and bold. But hey, maybe it will all work out!
A management style that works brilliantly at a 10-person company can destroy a 1,000-person company, which is a hard lesson to learn when some companies grow that fast in a few short years.
People handle risk and responsibility in totally different ways when a group scales from four people to 100 to 100,000 to 100 million.
There’s an old joke that consultants are like seagulls - they fly in, make lots of noise, mess everything up and then fly out. That’s pretty much what tech has done to media industries - it changes everything and then it leaves.
When you are asked to believe something — a newspaper headline, a statistic, a claim on social media, stop for a moment and notice your own feelings. Whatever the emotional reaction, take note of it. Having done so, you may be thinking more clearly already.
There are certain things that large numbers of people believe, despite the most straightforward evidence to the contrary. I wanted to understand why we work so hard to fool ourselves.
When software eats the world, the questions that matter stop being software questions.
There is no place for this sort of “wokeness” in financial policy or regulation. There will be double and triple standards for sure. It will be detrimental to long-term growth, and detrimental to the entirety of society.
You are going to hit the red and the red is going into that pocket. It is the law of the billiard table, the law of the billiard room. The white ball could not miss according to the laws of the billiard table. But the laws of the billiard table are not the only laws in this particular game.
Formulating our marketing and advertising activities from a real world perspective may lead to startling insights and revolutionary strategies. Or it may convince us that our current efforts are on the right track. Or, most likely, it will lead to a little of each.
The point is we should go out of our way to learn about investing by looking at things that have nothing to do with investing. And we should learn about things that have nothing to do with investing by looking at investing. It’s more fun and gets you closer to the truth.
All in all, this is a post worth reading carefully. This is indeed where we are going, and this is a nice effort to put economic logic to it. If you find the logic wanting, well, then you know more surely that it will end badly.
The pandemic has exposed the flaws in the belief that people need to be manipulated into making smarter choices. We need to move beyond the idea that we are all flawed risk-takers who need constant nudging and manipulation by our betters.
Capitalism, the less fettered the better, is the one thing that can remedy the wealth inequality we have in the US and across the world. It raises standards of living faster than any other system.
So far the stock market thinks that this isn’t quite as bad as it appears to me. But that is the difference between a bull market and a bear market. In a bull market nobody is carrying the risk and nobody gets marked down. In a bear market everyone is carrying the risk and everyone is marked down.
Key Zoom user stats. Includes data on customers, usage and more.
So who is holding the bag? Well, genuinely I do not know. It could be Insurance Australia Group or Tokio Marine. It could be German taxpayers (through the subsidiary bank) and Credit Suisse. I figure I know the winners though. Lawyers. Lots and lots of lawyers
And if these seem like conflicts of interest, they are just the tip of the iceberg.
Since the Congresspeople love to centralize power so much with lots of legislation, why not centralize the management of their personal finances?
“Recently somebody said, ‘Hey, you lost weight,’ and I said, ‘Yeah, thirty-five pounds and three and a half billion dollars’.”
But there’s not one day that goes by that I don’t sit back and say, “I wish the stock price weren’t where it was. I wish people weren’t writing those things. I wish I had done certain things differently.” And I think that every day I live, I’ll have those moments.
People with limited understanding of business think that business is all about making profits. But those who actually run businesses know that running a business is all about managing cash flows.
When she was a practicing occupational therapist, Elizabeth Fain started noticing something odd in her clinic: Her patients were weak. More specifically, their grip strengths, recorded via a hand-held dynamometer, were “not anywhere close to the norms” that had been established back in the 1980s. -Tom Vanderbilt Raising the American
On a long enough timeline, the survival rate for everyone drops to zero.
My gut tells me that people will be flexible about coming into the office until 2022. If their top-line revenue suffers they will quickly revert. They’ll want to see smiling faces in bright shiny places.
“Altucher’s new book, Skip the Line, is his best book EVER. It’s his first book filled with practical advice that has worked for him and others. I wish I read it when I was a young comedian.” – Jerry Seinfeld.
When you look at it, it turns out Wokethink is defined by the Ten Cognitive Distortions therapists focus on when treating mental illness.
We lay out the major economic and social changes that are going to shape the world of investing for the next ten years and beyond.
The idea behind Libra is that sending money should be as easy and secure as sending a message. Libra will be a global payment system.
Senator Joe Manchin – the guy in the middle in our 50-50 + 1 = 51 votes. Did his state West Virginia dirt in the matter of the Keystone XL Pipeline.
The ideas that Bill Gates is positing go against basic laws of economics and finance. Many of those laws aren’t “written law” but hard-wired into the human conscience. That’s another reason why they won’t work which is separate from the question of whether global warming is an issue or not.
What fintechs are learning is that when it comes to regulators, watch what they do, not what they say.
How many great ideas have already been discovered but could grow 100x or more if someone just explained them better? How many products have only found a fraction of their potential market because the company is so bad at describing them to customers? So, so many.
I’m in the camp that every correction is healthy if you’re someone who is still saving money. Down markets are a good thing because they allow you to average in at lower prices and higher yields. And whether down markets are good for you or not, they’re a feature of the stock market.
“Pish. Posh.” is a technical term only used by market professionals* for those situations where one has decided to go full Alinsky rule #5: Ridicule is man’s most potent weapon. It’s hard to counterattack ridicule, and it infuriates the opposition, which then reacts to your advantage…
What happens when rent, returns and advertising blur into one? What would it mean to do ecommerce that doesn’t scale?
From stimulus to school admissions, leaders act as if ease is the only worthy goal.
Allow me to make the case that Robinhood is becoming the Facebook of finance and then stick around for some thoughts on how they can avoid this fate.
Bemoan the might of Wall St, fine, but the real power lies elsewhere.
The thing that Merle Haggard thought would wreck his career turned out to be the thing that took his career to iconic status. He became successful when he dared to sing about the experiences that shaped who he was.
The normal distribution is disappearing: we’re in a new world where either you care about something, or you don’t. The middle ground is vanishing.
No matter how determined you are, it’s hard not to be influenced by the people around you. It’s not so much that you do whatever a city expects of you, but that you get discouraged when no one around you cares about the same things you do.
You’d think that after 10 plus years of hysterical “millennial” horseshit that went nowhere, the advertising industry would have learned something. But, of course, the ad industry never learns anything. So here we are again with the latest magical mystery generation – Gen Z.
Once you look for feedback loops you see them everywhere. And once you realize how powerful they can be you start to answer some of the most frequent questions in business and investing.
You don’t have to be reminded of this anymore, because WallStreetBets has forced it out into the open. The system is structured so that Joe Public loses, and the Establishment always wins, even if they have to change the rules or endlessly move the goalposts to do it.
My hope is that people in Canada reading this will realize that the problem facing us isn’t a lack of anything. Our problem is actually the presence of actively bad things:
The idea of artificial intelligence overthrowing humankind has been talked about for many decades, and scientists have just delivered their verdict on whether we’d be able to control a high-level computer super-intelligence. The answer?
From time to time, readers of the Absolute Return Letter ask for my opinion on this or that and, every now and then, I decide to turn my response into a letter. The last few weeks have been no exception.
Covid has created vastly different points of view, and it’s given people lots of time to sit on the internet. It’s a different world, and you ignore how much has changed at your own expense.
Joe Biden will be my President on Wednesday and already he has stepped up to bad policy. The decision to cancel the Keystone XL Pipeline is a bad policy decision. The knee jerk, no consultation with Canada, first day move is an insult to our country and Canada. Just bad policy and bad process.
I wrote a while back about this general phenomenon: as friction goes away, we turn from asset ownership to service consumption as our preferred model for fulfilling jobs-to-be-done.
For those unacquainted with the term, being shadow-banned means you are invisible to everyone except yourself. You can comment morning, noon, and night, and get your jollies spouting out about anything you want, and no one can see you.
Free speech and censorship. Manipulation and insecurity. Social media has many problems, and the answers aren’t easy. There is hope, however.
As this year draws to a close, I find myself wondering if some of the ideas and methods that have been used to create vaccines and to push back against COVID-19 will find broader applicability in the years ahead, perhaps in areas reaching well beyond health care.
If you were a bad guy, and you could easily steal billions of dollars with a tiny possibility of detection and no possibility of consequences even if you were detected, why wouldn't you?
Everyone’s different, with varying levels of confidence and tolerance for what they can put up with in investing. But the idea that endurance is more important than annual returns even if annual returns get all the attention is something virtually every investor should think more about.
Covid’s real legacy for homeownership and residential development may be the temporary patches, circumventing local feedback loops, that become permanent.
Be well, amigos. If you don’t care, that’s fine. I don’t care that you don’t care when I say, “Be well, amigos.” I would even fight for your right to feel like that.
The 2008 crisis helped to educate us on the warning signals. These we need to watch as the global economy, businesses and households are beaten up by the economic impact of the covid-19 pandemic.
Thousands of listed companies are being told to get woke, or else. Nasdaq is yet another player in an ever growing list to cave to the new religion
Orwell died in 1950. I wonder what he’d think of the future he wrote about but never saw.
As I travel around and read the output of central banks and other institutions, in 10 short years it is now universally understood that regulators job is to "monitor risks" everywhere in the financial system. not just those risks that might conceivably cause a run, panic, or crisis.
The New York Times recently highlighted a business in Japan that is more than 1,000 years old. Japan is also home to more than 33,000 businesses that are at least 100 years old (over 40% of the world’s total).
If you don’t fight them here, you’ll have to fight them there.
“The last capitalist we hang shall be the one who sold us the rope.”– Karl Marx
Then there’s the big unknown: the crazy, disconnected, counterintuitive change set in motion this year that we’ll only be able to piece together in hindsight.
Many, perhaps close to the majority, of the thousands of men who celebrated Christmas 1914 together would not live to see the return of peace. But for those who did survive, the truce was something that would never be forgotten.
There’s a huge amount of innovation and a huge amount of primary technology creation going on at the moment, but there always is - the question here is how universal something could become.
Doc has since passed on. Every year around Christmas he always comes to mind. Maybe it reminds me of our Christmas trips with Doc but maybe it’s because Doc is what Christmas is all about – unconditional acceptance and giving what is most difficult to give – ourselves.
Operation Warp Speed began this spring when it became clear that the virus was here for the duration and that an active measure was required to kill it.
Based on my experience covering insurers, when a carrier takes a reserve hit on a long tail liability (like, say, worker’s comp or asbestos), there is almost always another shoe to drop.
Capital in the US is moving out of traditional places that are high tax and highly regulated to places with lower tax and lower regulation. Human capital will follow.
Saving money doesn’t just have to be about buying your independence from work decades into the future. It can also be about giving yourself the ability to take some risks in the present because you have a financial backstop.
You want people who see the world differently. They can see the fulcrum in a different place altogether.
We are raising a generation of weaklings, more prone to everything from premature aging to mental disorders. Or is the opposite true? Is this just the latest step in the age-old weakening of our species as we emerged from the trees and built up civilization?
Joe Biden keeps saying there is no plan to roll out the COVID vaccine when, in fact, there is. The Big Red Car writes a letter to Joe to ‘splain the plan.
Productive discussion using reason and logic used to be how we arrived at the truth. Now of course, we have Facebook, Twitter, Google, and that ridiculously inept or just downright corrupt “fact checking” site – Snopes… and all the other fact knowers who do that job for us.
America is back! The Biden admin will Build It Back Better! Unfortunately, it is looking more like Obama 3.0 when it comes to foreign policy. Scared yet?
COBOL will probably never die. But that hasn’t stopped many coders from predicting, over and over again, that it is about to meet its doom. Indeed, the first warning that COBOL was dead came from before the language was even released.
I always have a sense of gratitude when I see people getting their hands dirty engaged in physical labor. I have that same sense of gratitude for people who stock shelves, work the registers, wait tables or perform any job that involves long hours, sore feet and aching backs.
We should pay attention to little moments – they can change our lives. Thank you TiVo and thank you … whatever caused the electricity to go out at the DoubleTree in Omaha.
I’m starting to think Governor Newsom doesn’t really care all that much about Covid-19.
The second kind of history to learn from are the broad behaviors that show up again and again, in multiple fields and different eras. They are the 30,000-foot takeaways from events that hide layers below the main story, often going ignored.
If policies are adjusted to unburden larger percentages of society, there will be more incentives for people to create innovations, companies, hire people, and increase prosperity.
It began as a “movement” with a haphazard bunch of intolerant folk who, not content to only do with their money as they pleased, began forcing others to do as they say.
Memes are self-sustaining ideas that live in the human brain. They are as alive as any bacteria or virus, and they infect every aspect of our social lives.
At their core, they believe the world has changed. That the world has become “uberized.” A world where consumers expect magic to happen at the push of a button (this is true).
For both Zillow and Redfin, the current market has brought not just more customers but also increased traffic to their websites.
A wave of disintermediation has squeezed margins in many sales and advisory professions. Real estate agents have been a puzzling exception to that trend.
If it’s hard to imagine China as a champion for the woke hysteria around “climate change” that’s because they’re not. This is quite simply Xi leveraging the hysteria over climate change for geopolitical purposes.
Some economists have famously taken it upon themselves to use their PhD credentials to masquerade their normative views as positive economic policy propositions.
I will not hold unreasonable expectations and will not act surprised or offended if there is a gap between his campaign promises and his actions. I will sympathize with him having to deal with the Far Left, that bat shit crazy AOC and her Squad.
One of the many highlights of my fatherhood experience was when one of my children was assigned a paper on the Hoover Dam.
By focusing on the job-to-be-done, you can see who a product’s real competitors are.
For the past three decades, California’s leaders have assumed that the state’s great advantages — superb universities, a large, diverse labor force, international connections — would help us weather economic storms.
I’m open to all logic, data and science based objections or counter-points to where I am wrong on this, bearing in mind that “SHUT UP AND LISTEN TO THE GOVERNMENT AND SCIENCE” isn’t a logical, scientific or data driven counter-argument.
Children in America grew up with blackouts and air raid wardens who searched the skies for enemy bombers. It was a scary world where children had to wonder if the monsters would reach our shores. It was that world that prepared young Fred Rogers for what he would do the rest of his life.
The first way in which accountability can go wrong is in the lack of it.
The definition of a Southern gentleman is a man who makes others feel more comfortable in his presence.
The purpose of Stoicism was to help human beings become better, to rise above their circumstances. Did they always succeed? Were they perfect practitioners? Did they manage to meet our modern expectations and morals always? Of course not.
We can’t completely overcome survivorship bias. The best we can do is acknowledge it, and when the stakes are high or the result important, stop and look for the stories of those who were unsuccessful. They have just as much, if not more, to teach us.
Filters are some of the most important things to spend time developing well in order to become a great investor. If your filters are good enough, you can save a lot of time and, hopefully, avoid a lot of mistakes.
The most compassionate approach that balances the risks and benefits of reaching herd immunity, is to allow those who are at minimal risk of death to live their lives normally to build up immunity to the virus through natural infection, while better protecting those who are at highest risk.
Customers are willing to pay for convenience.
I am not a doctor, an infectious disease specialist, etc. But in a democracy all citizens should think about wise public policy and learn from differing views.
When you’re strong in the Great Ability, neither rain nor sleet nor sprinkler can drive you away from doing what you think is right.
If you ever find yourself swimming in an idyllic tropical cove and are approached by a CFA instructor, take my advice: Swim the other way.
The World runs on rules - whether we like it or not.
Blue-city urbanization imposes a downward mobility people don’t want and don’t need.
It’s important to remember, your network isn’t about what you can get out of it. It’s about what you put into it.
If there’s one aspect of the story of the Great Escape that appeals most to the masculine heart, it’s the way it exemplifies the qualities of manly camaraderie.
The clouds eventually pass. In a post-mortem of what happened, you recognize your faults and what you did wrong. It looks so obvious in hindsight.
At the United Nations, whose general hostility to free speech is fairly well established, a proposal is on the table to allow the prosecution of people, like myself, who publicly disagree with the UN’s position on climate science:
The giant bubble in nonsense is slowly being unravelled and the places to allocate your capital are decidedly NOT where the chattering classes would have you believe. Do yourself a favour and think for yourself. Do the math and tell me it aint so.
Anyone who is “engaging” with you on a Facebook page or group is doing so with a hidden agenda. That has to be the case, because this is business, and everyone’s got an agenda.
The names change. The assets are different. The economic environments are never the same. The stories are always new and exciting. Yet speculation is as old as the hills and it will never go away.
As governments around the globe print money, push interest rates to (below) zero, and artificially prop up equity markets, faith that the state can protect citizens (and investors) is at an all-time low.
If we want to make ourselves less fragile in the face of great challenge, the first step is to accept that you are never going to know what the next disaster will be.Then ask yourself: How can I prepare anyway? What changes can I make to better face the unknown?
How many times have you heard some genius say, "the agency model is broken." Of course, it's broken. The problem is, no one seems to know how to glue it back together.
Today’s internet “experts” often do not know enough to recognize what they ought to know, much less that they do not know it. Good musicians know when they are out of tune. Bad musicians do not.
When a company says, “help me grow 2.5x in 3 years,” usually followed by, “with a modest budget and within a tightly defined marketing area,” what they're really saying is, “change my inputs,” except what they mean is, “change my outputs.”
I’ve actually never seen a country entering a civil war ending in deflation. But then again the disconnect between main street and wall street has long been a poster child of FED policy.
This a simulation we’ve been put into where the gamemaker is saying, “Let’s see how INSANE we can make the world seem before they CRACK!”
We need to confront this environment on its own unique terms: we have never been here before. We have to incredibly careful not to fall back on using old mental models. With every move we make, we have to reexamine our assumptions.
"The thing I worry about the most is that we would lose our way… lose our obsessive focus on customers or would become somehow short term-oriented or.. become overly cautious, failure-averse.” -Jeff Bezos
"There are a lot of variables,” Gov. Cuomo admitted. “I understand that.” But does he really?"I'm sort of out of the guessing business," he proclaimed. But is he really?
Honestly, I didn’t even realize how great my own state was until I started exploring.Then, a bunch of assholes started burning everything down. Which is yet another reminder that if you don’t go and see things now, you may never get to.
In investing, the average consequences of risk make up most of the daily news headlines. But the tail-end consequences of risk – like pandemics, and depressions – are what make the pages of history books. They’re all that matter. They’re all you should focus on.
Stock markets crashed and bond yields collapsed as coronavirus ravaged the world: whatever happens next, 2020 will be one for the history books.
Even though a single bad event is stronger than a series of good events, going through the bad stuff can better prepare you for life’s many challenges.
Right now a ton of real wealth is being actively destroyed, whether we’re talking about farmers slaughtering cattle, pouring milk down the drain, or ploughing their veggies back into the land it’s real tangible wealth being destroyed.
Commercial distancing in business is deliberately embracing the race to the top to avoid the congestion of undervalued work and underpriced products.
A lot of the small businesses and restaurants that created the character we loved about the place we were from are not going to survive the quarantine. It will be interesting to see the data five years from now on migration patterns.
Think of your beliefs like clothing, not tattoos.You want to be able to easily change and adapt them for you, but not have them become a permanent part of who you are. This will be true for you as an investor and decision maker throughout your life.
COVID-19 was a bad cold that global governments overreacted to. The ramifications of this error will be ricocheting around for long after we all take our masks off and go on with life.
We tend to forget that most people are so worried about their own problems that they don’t have time to think about your own faults.
Short-term thinking is the root of most of our problems in business, investing, and politics. But I get why it happens. It has to happen. Short-term thinking can be the only way you’ll survive long enough to experience long-term results. It’s an acceptable flaw.
No one asked for this virus so it’s difficult to point a finger at anyone to blame them for the outcomes.
The physical desire among humans to be physically present is hard-wired inside of us. It’s not going to go away.
The thread through all of this is that we don’t know what will happen, but we do know what could happen - we don’t know the answer, but we can at least ask useful questions. The key challenge to any assertion about what will happen, I think, is to ask ‘well, what would have to change?’
A part of me hopes that the facts will matter. That society will look at this and say…why we really are foolish to panic and create hysteria over something that kills an absolutely de minimis number of people.
Tom Colicchio, the celebrity chef, thinks 50 percent of restaurants may not survive the pandemic, and that they’re going to have to change.
Let’s help the people first. The states can be run like businesses and start selling assets. And then, finally, let’s do a New Deal based on taking our workers and teaching them valuable new skills for the next century. Meanwhile, I am making use of this valuable lockdown time to learn new skills.
After the introduction Jim asked if they wanted to participate in his project and instructed those who did to complete three sentences: I am… I regret… Before I die…
When people ask, “What are you preparing for?” you’ll say, “A world that history shows is both a growth machine and a continuous chain of unforeseen agony.” A world where we have no idea what will happen next. Nothing more specific.
The longer the lockdowns last, the worse it will be. You might understand a lockdown in an urban area but the policies are so uneven and random they make no sense. The government is not the answer to our fiscal problems. In most cases, they are a cause of the problem.
Life comes at us fast. Today. Tomorrow. When we least expect it. Be ready. Be strong. Don’t let your light be snuffed out.
We’re actually decent people in a crisis – and stories claiming otherwise do harm
What we’re dealing with now is different. Like a war, it affects everyone at the same time in a more universal way than a typical recession. Business moats and brand awareness don’t matter when your customers are ordered by law to stay in their homes.
I’m not sure why I did this. I wanted to show how, when you connect the dots, something complicated can be presented in a simple fashion.I also wanted to underline future unknowns in what is happening now by looking at the past.
No matter who you are, we need you. Don’t lose yourself. Find yourself. Bring it forth. Share it. YOU are our silver lining.
The bottom line I read from Jonathan: Dear Fellow Citizens: Go out. Start up businesses. And shut up!
In terms of the office segment, and the credit and securitization apparatus behind it, and the inflated “valuations” all this is based on: There is no way back to the old normal.
What happens when the bottom starts pushing back against the top? Part of it is already happening. Trump, Bernie Sanders, and Brexit all represent people saying, “Stop the ride, we’re going to try something new. If you don’t like it, too bad. This is the way things work.”
For peace of mind in the pandemic, let go of impossible To Do lists. I won’t pretend that in this frightening time all anxiety will be banished by clarifying a to-do list. It won’t.
Don’t get me wrong, this place is my home and I love being here. In my experience, everything has a shelf life. Especially in times of bonanza.
If you were to divide the world between experts and non-experts, who would be the experts who decide? Who watches the watchmen?
Be good to each other, that was the prevailing belief of Marcus’s life. A disease like the plague, “can only threaten your life,” he said in Meditations, but evil, selfishness, pride, hypocrisy, fear—these things “attack our humanity.”
Reporters just aren’t that smart these days. They have zero curiosity. Not only that, most of report via the blue lens which only furthers their bias.
In January, everyone was online, and probably willing to try anything online. Now we don’t have a choice - we’re shut indoors for weeks or months. What does that means for work? Ecommerce? Health and education? And the people left behind?
Marginal businesses that were struggling pre-COVID19 will be body bagged and cremated, but the vast majority of sound businesses will return. There will be rule changes. There will be changes to the numbers.
But as I always say to my kids. Don’t bitch to me about the situation…figure it out and make sure you make it work for you. Winners don’t complain. They attack a problem. Go forth and attack it dammit.
We can’t give into fear. We have to repeat to ourselves over and over again: It’s OK to be scared, just don’t be afraid. We repeat: The world is a narrow bridge and I will not be afraid.
Their numbers were never more than 350, most of whom were New Zealanders and all of whom were volunteers. In one call for recruits, eight hundred applied. The LRDG took twelve.
The psychological triggers that cause us to overrate the stuff we can see and ignore the stuff we can’t are hardwired into our neural systems and can only be overcome with huge efforts of will.
We need to stop being so fearful. It makes us dumb. It turns us into sheep. Don’t be a sheep.
The reality is that some level of learned helplessness is controlling many of our lives. So, realize that any helplessness you feel is created by your own mental prison. Rip off the shackles you voluntarily keep in your mind. You’re the warden and it’s time for parole.
Our devotion to our values gets tested in the face of a true crisis. But it’s also an opportunity to reconnect, recommit, and sometimes, bake some bread.
If you think the bottom is in a few months, you really ought to start learning the companies now.
We’ll always be debating problems and chasing new answers, despite our desire to think we’ve found a solution. As certain as death and taxes.
My teachers always used to tell me: stop and think, check your answer, and explain your reasoning. It was wise counsel. Some lessons stand the test of time.
Risk has three parts: The odds you will get hit, the average consequences of getting hit, and the tail-end consequences of getting hit. No single person has all the answers.
Right now things seem easy. It won’t last forever. Things will “end badly” but stocks don’t stop trading following a bear market. Life goes on and so will your investments.
The prisoner’s dilemma distilled the tension between selfishness and co-operation into a potent form, making it emblematic of the risk of nuclear destruction and much more besides.
Some say there’s no reason to care about other people’s feelings if the facts are on your side. The causes of this spreading through our culture are many.
Sometimes it’s really hard to tell what something’s worth. However, this isn’t Schrodinger’s cat; it’s either a healthy business or hurtling towards bankruptcy. It can’t be both.
“You could be good today,” the Roman emperor Marcus Aurelius wrote. “But instead you choose tomorrow.” That quote haunts me as much as it inspires me. And it does a lot of each.
Baseball people are smart. They don't spend a lot of time trying to teach pitchers how to hit.
Great friendships have shaped the world. Bonds formed during childhood or war, through shared hardships and great passions, are responsible for some of humanity’s greatest achievements.
Start in the upper right by learning about the architecture of the organization; you’ll be surprised at what you stumble upon.
Would someone please explain to me again about the critical importance of "brand purpose?"
Perhaps it is true that what does not kill us makes us stronger. It may, in contrast, be that what does not kill us nevertheless slows us down.
The ability to keep your head when others are losing theirs is a superpower. The world doesn’t always work the way you want it to.
In the world of tech startups, messing up is practically a religion. This company is here to pick up the pieces.
Many of the good writers you enjoy probably aren’t much smarter than you. They’ve just forced themselves through the process of transferring vague feelings into words and the clarity that generates.
This post is not for those who already know how their bills will be paid. This post is not for those who are already making a solid living. This post is not for those who have a savings account or a financial cushion or a money-making spouse or a retirement fund.
What was wrong with me? I just couldn’t write anything. I’d come up with an idea, jot down some thoughts, then quit. Find out how I got over this frustrating time.
When you look at how much time we waste, [it seems] that life is already too long — so long that we become complacent and we waste great swathes, so many hours.
"When confronted with the bald truth that most scientists never come up with any earthshaking findings, most new businesses end in failure, and most whistle-blowers get demoted or fired, it is not surprising that people generally opt for a safer, more normal life than that followed by the creative.”
People believe what they’ve seen happen exponentially more than what they read about has happened to other people, if they read about other people at all. We’re all biased to our own personal history. Everyone.
When I read the book, I couldn’t help but see parts of my life through the lens of leadership: both mine personally and what I witness in companies around the world. Leadership is tough and there are few better teachers than McChrystal.
What if there was one person who masterminded a system that guaranteed a profit? One person who’d made almost a billion dollars, and who’d never told his story—until now?
Investing is simple. But it isn’t easy. Human emotions get in the way. Descendants of millionaires from the 1900s might know this better than most. If we can sideline fear and greed, we might learn from their mistakes.
Today’s global investment environment is a game of musical chairs. Investors are up and marching along because the music is playing, hoping they’ll be able to grab a chair when the music stops
Solving problems is the ability to get stuff done. And getting stuff done requires way more than math proofs and rote memorization.
How Running A Business Changes The Way You Think
It’s the second-order consequences that are hardest to see, but most interesting.
The decision matrix is a powerful tool to help you prioritize which decisions deserve your attention as a leader, and which should be delegated.
The Dairy Queen empire began with a dream, a dime, and, of course, a metric fuckton of ice cream.
Capital Thinking [https://www.getrevue.co/profile/eric-chunn?utm_campaign=Issue&utm_content=topprofilename&utm_medium=email&utm_source=Capital+Thinking] • Issue #162 • View online [https://www.getrevue.co/profile/eric-chunn/issues/capital-thinking-issue-162-136419?utm_campaign=Issue&utm_content=view_in_browser&utm_medium=email&utm_source=Capital+Thinking] The driving
The most significant part of the financial crisis that peaked ten years ago this month was that it took place within eight years of both the dot-com crash and 9/11
Every oil and gas company lives in a shale-shaped world, of an ever present risk of oversupply and $29 oil again, of the need to measure capital invested in a shale well against any other type.
You know, everybody talks a big game about creativity, but most can’t actually define it. Maybe it’s kinda like porn - you know it when you see it?
I do so love that shy little Amy has the balls to say what she really means.You can catch the rest of what Amy has to say here
If I asked you how your Buyers decide to buy your product, would you automatically tell me how you sell it to them instead?
Health care is notionally a profit-driven free market. This looks like an easy opportunity to make trillions of dollars by making the world better for everyone. Why doesn’t someone do that?
We can learn a lot from these Pros. The digital age requires just as much courage and forbearance as the analog age did. The heat of the fight has just moved from an external one to an internal one. No matter the battle, doing truthful and authentic work is exhausting.
In other words, self-doubt is an indicator. It’s the proof of a hidden positive. It’s the flip side of our dream.
Yes. It’s overly reductive. People are not merely “vectors” (thank goodness). But, in so many ways, the mental model delivers a beautiful degree of clarity.
I think my talent, such that it is, is this ability to view things systematically and to see very clearly and quickly how a business model flows through to product decisions.”
How do you know when your current decision should be made slowly: contemplative, collaborative, deliberate, data-driven, even agonizing?
The author’s research is painstaking. After the war, military documents were scattered across Europe, and key French records were declassified only in 2016. Turing unearths a remarkable tale of intellect, bravery and camaraderie that reads like a nail-biting spy novel.
This is the classical way to think about the distribution of human intelligence and human idiocy—each person is mostly a concentration of one or the other. But maybe that simplistic view is a good example of our stupid-aspect at work. Perhaps every single one of us is stupid, just not completely.
It’s the second-order consequences that are hardest to see, but most interesting.
Being first is not the same as having a sustainable competitive advantage, no matter how disruptive you are, and the advantage might be somewhere else.
I’ve made this point before, but it is important to repeat: 10 years ago Amazon was not taken too seriously. Giants like Google, now Alphabet, and Microsoft ignored Amazon’s entry into cloud hosting, thinking “What does a bookseller know about the cloud?”
Small enterprises are often overlooked in the world of business books. There are millions of words dissecting in great detail how great companies began and how they operate. There are business models, case studies, autobiographies, and critiques. With small to medium size businesses, not so much.
I sought every opportunity I could to do things differently. But as I have learned over the years, it wasn’t an act. It wasn’t me trying to be someone I wasn’t. Instead, it was me trying to be someone I was.
His solo stride piano and pipe organ playing may have found him fans amongst record buyers but what got them flocking to the Sherman was his live schtick.
The one pristine white cover is now its own shade of tan, but with every read, every time I’ve touched the book, I’ve gotten something new or been reminded of something timeless and important.
The best way to focus and prioritize correctly - straight from "The Man" himself: Warren Buffett.
Nasty Gal filed for Chapter 11 bankruptcy protection. This surprised me. It looked like Nasty Gal was a good company, Amoruso was #53 on the Forbes self-made richest women list, and I even linked to her book a bunch of times! What the hell happened?
We tend to believe our habits are a product of our motivation, talent, and effort. Certainly, these qualities matter. But the surprising thing is, especially over a long time period, your personal characteristics tend to get overpowered by your environment.
You would think spending eight seconds on the back of raging bull would be easy. But as a person who’s done it many times, I can assure you it’s not.
Intuit is simultaneously more profitable than glamorous startups and growing faster than established incumbents. This is the Tom Brady of its industry—performing at the top of its game at an age when its onetime peers have long since stopped playing.
Take a look at the world-class construction firm based in Omaha and the man behind the company. A man who became a mentor to none other than Warren Buffett.
Speaking of interesting - a thread popped up on Reddit earlier this year suggesting that there were far too many Mattress Firm locations around the country and the only possible reason for their continued presence was “money laundering”.
Those who believe the primary objective of advertising is to engage an individual do not understand the first principle of advertising. Engaging an individual is the slow bus to nowhere. Advertising’s first objective is to gain the attention of a lot of people.
I immediately thought about how we humans can latch onto beliefs that are utter nonsense and pursue those beliefs to our detriment. There are more folks afraid of flying than there are afraid of driving cars, which is silly since airline travel is in order of magnitude safer.
Just trying to compete on operational effectiveness alone is a very bad idea. Operational effectiveness is essential but in the long term it is not enough to guarantee success.
Movie Pass: The Good, the Bad, and the Ugly.
That moment when your career reaches “Peak You”. When your job is no longer just a dress rehearsal for something greater, no longer just preparation for something better.
These days Amazon touches nearly everyone, everywhere. And that’s just how Jeff Bezos planned it all those years ago. He laid those plans out early and talked about them often. What’s more, he wrote about them. Extensively.
“How do you start a life these days?” the old timer was saying at Bagel Plaza the other morning in my hometown of Merrick, New York.“You can’t afford to live anywhere.”
Words are never just words. They're either helping you sell, or preventing you from selling. "Meh" is "no." - Ash Ambirge
Capital Thinking [https://www.getrevue.co/profile/eric-chunn?utm_campaign=Issue&utm_content=topprofilename&utm_medium=email&utm_source=Capital+Thinking] • Issue #85 • View online [https://www.getrevue.co/profile/eric-chunn/issues/capital-thinking-issue-85-117941?utm_campaign=Issue&utm_content=view_in_browser&utm_medium=email&utm_source=Capital+Thinking] Like everyone,
One thing most small companies fail to get their target market and pricing right. They just don’t make the correct decisions, rely on incomplete data, or simply have the wrong people running the show. And correct pricing is critical to survival.
Seems we fool ourselves constantly. We leave out or discard important information because it doesn’t fit our narrative - or simply because we’re too lazy to discover what we don’t know.
“In a republic, to be successful we must learn to combine intensity of conviction with a broad tolerance of difference of conviction.”
In fact, I like nearly everything these guys build. Nicely detailed classics that would look really nice in my driveway. Take a look for yourself and feel free to send one my way.
Why'd you take the chance?
At the end of the day, our personal data is just that - personal. And it’s up to us to safeguard our own data. Nobody else is going to do it.
It seems nearly impossible to believe these days, but once upon a time, Sears was the Amazon of its day.
“But he had his place now in history. A place invented for him, if not by him.”
“Baseball,” he said. “It gets into you and it never gets out.” Then he smiled and reached for his wallet and said, “Let me show you something.”
Remember this line: The way you do anything is the way you do everything. Remember it.