Week 12 – The Stock Market is Down

Hi Reader,

This is a great time as any to thank you all for reading my weekly ramblings. In a world where every other person seems to have a newsletter, it means a lot that you're able to find some value in this collection of random topics and anti-news. Almost by definition, long-term concepts are not the most exciting to read about, yet I think we're building a community of like-minded people that are obsessed about driving results in the long-term and learning more about how the world works. I hope I can continue to write this for you. If you want to thank a friend who should be part of this community, you can send them a copy :). Happy Thanksgiving!

P.S. I was able to celebrate in Seattle and also confirmed that the best time to fly is on Thanksgiving day.

🐦 Tech (mainly) tweets I'm reading

Erik Torenberg introduces the idea of a "career moat".
99% of effort in intellectual domains is wasted, says Naval.
Brian Armstrong (CEO of Coinbase) recommends their video to explain crypto to your family.
Fred Destin lists stuff VCs do that makes Founders angry.

📉 Investing

There have been significant losses across multiple asset classes: US stocks, the energy sector as well as crypto. My condolences to anyone who was affected by this.

The obvious question is - could we have predicted it?

It's useful to follow and learn from industry insiders like Fred Wilson. Nearly half a year ago he explained how he is investing a lot more in cash and real estate ahead of a coming correction.

The other answer is that you shouldn't and can't try to predict these corrections. In fact, a lot of the corrections are not systemic (yet), but due to specific misaligned expectations (e.g., iPhone sales quotas, Facebook's revenue numbers). A safer option is to study some of the principles I have collected (and then exercise your own independent opinion). In particular, risk parity is designed to limit losses arising from a single asset class.

👩‍🔬 Science

Science is getting less bank for its buck according to research conducted by Michael Nielsen and Patrick Collison.

They have used a novel metric based on peer-rated relative importance and traced back innovations through several decades to confirm that overall progress based on time invested is slowing. They propose a number of possible root causes why that may be the case.

Intuitively this feels right, but there could be other reasons related to our ability to implement the science or willingness to develop it in an academic vs. private corporation context that make this a difficult one to crack.

They suggest greater cross-pollination of fields could ultimately help.

🏷 Branding

Supreme won the biggest award in Menswear. If you were wondering why it appeared in my article Sold out is the new brand, this is it. The win has been attributed to a rising trend in streetwear, but it's scarcity that has propelled streetwear to near luxury levels of appreciation.

The next milestone will be for an esports brand to do the same. I recently visited the RAZER store in San Francisco called RAZERZONE, if you're not convinced esports can be cool, have a visit. It's like the Apple store but for games.