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Thursday, 23 July 2020

Weekend Reading

Reading across disciplines is one of the best ways to improve our investment acumen. Here is a summary of some of the best articles I read this week.

I especially try to not post Corona related articles as that is all one gets to read in all traditional media.

 

If you like the collection this consider forwarding it to someone who you think will appreciate.


The Nespresso coffee revolution

The idea of a portioned coffee system had been around since the 50s, but no one had seriously pursued it. Favre’s aim was to build a world in which espresso was available at home. Customers would own a machine, into which they would place a sealed pod filled with ground coffee. The pod would keep the coffee fresh. (Although roast coffee can stay fresh for weeks, ground coffee loses its freshness after about half an hour.) The capsule design would also ensure greater aeration, mimicking the repeat oxidisations at the Sant’Eustachio. After the pod was inserted, a needle-like spout would pierce one end. Hot water would be pumped through this needle at high pressure. As the capsule became pressurised with water, the foil would be forced against a spiked plate, bursting it inwards, and out through the spout would run an espresso.

Today, some 14bn Nespresso capsules are sold every year, both online and from 810 brightly lit boutiques in 84 countries. More than 400 Nespressos are drunk every second. Hundreds of rivals and imitators have emerged, some making capsules for Nespresso machines, others pushing competitor systems.

https://www.theguardian.com/food/2020/jul/14/nespresso-coffee-capsule-pods-branding-clooney-nestle-recycling-environment

 

One line summary of investment classics

The author has gone through all the classic finance books and distilled the message into a single sentence or phrase.

https://awealthofcommonsense.com/2020/07/tldr-the-best-finance-books-in-one-sentence-2/

 

A short history of money (with a US bias)

In his expansive and excellent book A History of Money, author Glyn Davies lists six functions of money:

  • Unit of Account
  • Common measure of value
  • Medium of exchange
  • Means of payment
  • Standard for deferred payments
  • Store of Value

Modern paper currencies don’t meet the sixth function—un-invested dollars (or euros, or yen) dwindle in value over time. The modern dollar is an abstraction, created out of thin air. It can no longer be converted into anything at a fixed price. Yet, for most of its history money was tied to some underlying commodity.

http://www.millennialinvest.com/history-of-money/

 

The origin story of the Tupperware party

The story of the ubiquitous plastic container is a story of innovation and reinvention: how a new kind of plastic, made from an industrial waste material, ended up a symbol of female empowerment. The product ushered women into the workforce, encouraging them to make their own money, better their families, and win accolades and prizes without fear of being branded that 1950s anathema, “the career woman.”

The most amazing thing about Tupperware wasn’t that it extended the life of leftovers and a family’s budget, although it did both remarkably well. It was, above all, a career maker. When women came to one of Wise’s parties, they were more than just convinced to buy the product— Wise was such a charming host that she persuaded many buyers to also become Tupperware salespeople. Putting people on waiting lists, for instance, made them more eager to buy, so she signed them up regardless of whether the product was available. She also discovered that throwing containers full of liquid across the room made customers reach straight for their chequebooks. Amassing more and more saleswomen, Wise encouraged her followers to do the same. Driven by the idea of making money simply by throwing parties for friends and neighbours, the women in Wise’s workforce ballooned in number. Wise’s team in Detroit was selling more Tupperware than most department stores.

https://www.mentalfloss.com/article/59687/how-single-mom-created-plastic-food-storage-empire

 

The evolution of emojis

This elasticity of meaning is a large part of the appeal and, perhaps, the genius of emoji. They have proved to be well suited to the kind of emotional heavy lifting for which written language is often clumsy or awkward or problematic, especially when it’s relayed on tiny screens, tapped out in real time, using our thumbs. These seemingly infantile cartoons are instantly recognizable, which makes them understandable even across linguistic barriers. Decoding pictures as part of communication has been at the root of written language since there was such a thing as written language.

Pictograms—i.e., pictures of actual things, like a drawing of the sun—were the very first elements of written communication, found in Mesopotamia, Egypt, and China. From pictograms, which are literal representations, we moved to logograms, which are symbols that stand-in for a word ($, for example) and ideograms, which are pictures or symbols that represent an idea or abstract concept. Modern examples of ideograms include the person-in-a-wheelchair symbol that universally communicates accessibility and the red-hand symbol at a pedestrian crossing that signals not “red hand” but “stop.”

https://nymag.com/intelligencer/2014/11/emojis-rapid-evolution.html




Disclaimer: Abhishek Basumallick is the Head of the equity advisory www.intelsense.in for long term wealth creation and a pure quant focused newsletter at www.quantamental.in. The blog posts should not be construed as investment advice. Please do your own due diligence before investing.

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