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Saturday, 14 December 2019

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.

A drug to cure addiction of other drugs!
MindMed is a company that’s taking psychedelic drugs and turning them into medicine. This could save lives, cure depression, help alcoholism, get people off opioids. Its first drug has the potential to turn a person’s addictions—to cocaine, methamphetamine, morphine, sugar, alcohol—off like a light switch. It has a clear opportunity to help lower the nearly 70,000 annual drug overdose deaths that take place in the U.S. But the compound, 18-MC, has yet to undergo human efficacy trials.


Book stores and physical books are making a silent comeback
The industry is much better than it was — the last four to five years have been pretty healthy. The stores have survived the devastation the independent book business suffered after Amazon.com began selling books online and at lower prices in 1995.
statistics from the American Booksellers Association, a trade group for independent booksellers, show a recovery from the industry's darkest days. The ABA had 1,887 member companies as of May 15, up nearly 35% from 1,401 in 2009. The number of members' stores totalled 2,524 in May, up more than half from 1,651. Another sign of improving health: the number of books indies have sold. Book sales rose 5% in 2018 from 2017, and in 2017 they were up 2.6% from 2016.
Independent sellers are doing better even as Amazon continues to thrive online and to open its own stores, so far mostly in big metropolitan areas. The indies are also helped by the fact more people are reading printed books rather than electronic versions — sales of e-books fell 37% between 2014 and 2018


A new ad-model from Hulu binge watchers
Hulu knows many of its viewers watch show episodes back-to-back, and it's determined to bank on that with its advertising. Hulu is rolling out an ad system designed for binge watchers. The approach uses machine learning to predict when you're likely to marathon a show, and then sends "contextually relevant messaging" that acknowledge your viewing spree. When you reach the third episode, however, Hulu pulls out all the stops. It'll either give you an ad-free episode (with an ad beforehand, mind you) or a special offer from one of its sponsors.


Nestle sells ice-cream business to focus on core competency
For much of the last two years, Nestlé ​has been overhauling its portfolio to capture growth in the food space and shed underperforming or slow-growing businesses. Last year, Nestlé ​​sold its U.S. chocolate business, a deal that included more than 20 American candy brands like Butterfinger and Baby Ruth, to Ferrero for $2.8 billion.
Nestlé made a major bet on the future of plant-based foods with the 2017 purchase of Sweet Earth for an undisclosed sum. In the past few months, Nestlé expanded Sweet Earth into Awesome Burger and Awesome Grounds, the company's first foray into plant-based beef in the United States,. Last week, the company announced it would try the ingredient in its DiGiorno and Stouffer's brands.
It's also spending money to refresh its water business through the introduction of Poland Spring energy water and Nestlé Pure Life Plus, the brand's entrance into functional water.
Another focus has been the expansion of its coffee presence through the purchase of a stake in coffee shop chain Blue Bottle, the acquisition of Chameleon Cold-Brew and the dolling out $7.15 billion for the right to market Starbucks' beans, capsules and other products in stores.


The internet is forcing workaholism
A research team has found that hours worked since 1980 increased nearly 10 percent for Americans with bachelor’s and advanced degrees. Leamer told me that he believes this is because computing has shifted much of the economy from manufacturing to neurofacturing, Leamer’s term for intellectually intensive white-collar labor that is often connected to the internet, such as software programming, marketing, advertising, consulting, and publishing.
Neurofacturing jobs lend themselves to long hours for several reasons, Leamer said. They’re less physically arduous, as it’s easier to sit and type than to assemble engine parts. What’s more, the internet makes every hour of the day a potential working hour.
If the operating equipment of the 21st century is a portable device, this means the modern factory is not a place at all. It is the day itself. The computer age has liberated the tools of productivity from the office. Most knowledge workers, whose laptops and smartphones are portable all-purpose media-making machines, can theoretically be as productive at 2 p.m. in the main office as at 2 a.m. in a Tokyo WeWork or at midnight on the couch.

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Friday, 6 December 2019

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.


E-Sports (competitive video games) is big business
China now boasts a gaming population of over 500 million, and competitive gaming has become big business. Esports-related sales in China hit 51.3 billion yuan ($7.3 billion) during the first six months of 2019 and are on track to top 100 billion yuan for the year.
There are more than 5,000 gaming teams operating in an industry that now employs 440,000 people.
Depending on their contracts, trainees are paid about 10,000 yuan per month, while mid- to upper-ranking gamers earn around $50,000 annually, according to Li Xinyuan, the team manager. Top-tier gamers can earn over $90,000. Those rates mean even trainees make more than average factory workers in Shanghai, whose initial monthly take-home pay is typically around 4,000-5,000 yuan per month.


Vinod Sethi's prescription to becoming a better investor
Mr. Sethi believes that formal education is a necessity but not sufficient. He believes that education doesn’t teach you about hunger, relationship, courage, inner voice – listening to yourself, feel the present moment and many other aspects. There are many other aspects and skills which one requires in investing business and daily life.
Mr Sethi reads at least one annual report a day. He might read an annual report of a private company in Europe where he won’t be even able to invest. According to him, an annual report is a summary of collective human effort. Hence, it shouldn’t matter what annual report you are reading. One makes money where one sees financial efficiency, an alchemy or something stands out. There is no need to read an annual report to the last line. Over time one can develop sense as to what to read and what not to read. Also, according to him, speed reading helps.
Only way to meet very smart people is by making yourself very smart. No one would give you time unless you give more than they gave you. If you start every meeting thinking I must give more than what I am expected to gain, then you achieve a very high level of evolution at personal level.
Three things are a must do for a good investor:
Pay attention to the Market, Read & Research and Introspect

Can mirrors do the trick?
A typical large steel mill might burn through 1.5 million metric tons of coal in its furnaces in a year. It hasn’t been possible to run that type of industrial process on renewable energy, because of the extremely hot temperatures required, making nearly a quarter of global emissions hard to eliminate. But new technology—which concentrates solar thermal energy to 1,000 degrees Celsius for the first time—could transform some of the most polluting industries, including steel, cement, and petrochemical production.
The technology, from a California-based startup called Heliogen, uses an array of mirrors to reflect sunlight.


Machine learning determines ghost writer writing for Shakespeare
Literary analysts have long noticed the hand of another author in Shakespeare’s Henry VIII. Now a neural network has identified the specific scenes in question—and who actually wrote them.
For much of his life, William Shakespeare was the house playwright for an acting company called the King’s Men that performed his plays on the banks of the River Thames in London. When Shakespeare died in 1616, the company needed a replacement and turned to one of the most prolific and famous playwrights of the time, a man named John Fletcher.
The new approach is straightforward in principle. Machine-learning algorithms have been used for some years to identify distinctive patterns in the way authors write.
The technique uses a body of the author’s work to train the algorithm and a different, smaller body of work to test it on. However, because an author’s literary style can change throughout his or her lifetime, it is important to ensure that all works have the same style.
Once the algorithm has learned the style in terms of the most commonly used words and rhythmic patterns, it is able to recognize it in texts it has never seen.


Podcast: Replacing faulty body organs
Laser-printing organs and vascular systems to give everybody another chance has incredible value. It changes the dynamics of how to handle endemic diseases like diabetes and many other organ issues, liver, kidney and maybe eventually very complex systems like the nervous systems inside our bodies.

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Thursday, 5 December 2019

The Man Who Solved the Market by Gregory Zuckerman - My Highlights

I completed the book the week it was out in India. I have been following (reading about, listening to, watching) Jim Simons and a few others over the last two years that I have personally started learning and experimenting with quant systems. (Planning to start writing about my learnings on quant systems, more so that I can understand them better while trying to write).

 Simons has always been an enigma and I was certain that the book would not reveal any information which was not known earlier by the public but only supply anecdotes of his personal life. I was more or less right. There are practically no details of his trading system. But then again this book was probably not meant to. Overall, it was a great read. I would urge investors to read it, just to get a perspective of how a quant's view of investing is different from that of others.

The highlights are below. The bold markup is mine to highlight points I found interesting.

A former math professor, Simons is arguably the most successful trader in the history of modern finance. Since 1988, Renaissance’s flagship Medallion hedge fund has generated average annual returns of 66 percent, racking up trading profits of more than $100 billion

No one in the investment world comes close. Warren Buffett, George Soros, Peter Lynch, Steve Cohen, and Ray Dalio all fall short.

Early on, Simons made a decision to dig through mountains of data, employ advanced mathematics, and develop cutting-edge computer models, while others were still relying on intuition, instinct, and old-fashioned research for their own predictions.

By early 2019, hedge funds and other quantitative, or quant, investors had emerged as the market’s largest players, controlling about 30 percent of stock trading, topping the activity of both individual investors and traditional investing firms.

“If we have enough data, I know we can make predictions,” Simons told a colleague.

Unlike his rivals, Simons didn’t have a clue how to estimate cash flows, identify new products, or forecast interest rates. He was digging through reams of price information. There wasn’t even a proper name for this kind of trading, which involved data cleansing, signals, and backtesting, terms most Wall Street pros were wholly unfamiliar with.

“The lesson was: Do what you like in life, not what you feel you ‘should’ do,” Simons says. “It’s something I never forgot.”

The paper didn’t try to identify or predict these states using economic theory or other conventional methods, nor did the researchers seek to address why the market entered certain states. Simons and his colleagues used mathematics to determine the set of states best fitting the observed pricing data; their model then made its bets accordingly. The whys didn’t matter, Simons and his colleagues seemed to suggest, just the strategies to take advantage of the inferred states.

Simons and the code-breakers proposed a similar approach to predicting stock prices, relying on a sophisticated mathematical tool called a hidden Markov model.

Simons and his colleagues weren’t alone in suggesting that stock prices are set by a complex process with many inputs, including some that are hard or even impossible to pin down and not necessarily related to traditional, fundamental factors.

“Sometimes I look at this and feel I’m just some guy who doesn’t really know what he’s doing,” Simons said.

“If you make money, you feel like a genius,” he told a friend. “If you lose, you’re a dope.”

Stochastic equations model dynamic processes that evolve over time and can involve a high level of uncertainty.

“Just follow the data, Jim,” he said. “It’s not me, it’s the data.”

Dennis himself is said to have made $80 million in 1986 and managed about $100 million a year later. He was crushed in 1987’s market turbulence, however, the latest trader with a style that bore a resemblance to Simons’s to crash and burn.

No one ever made a decision because of a number. They need a story.

“Any time you hear financial experts talking about how the market went up because of such and such—remember it’s all nonsense,”

“LTCM’s basic error was believing its models were truth,” Patterson says. “We never believed our models reflected reality—just some aspects of reality.”

“We’re right 50.75 percent of the time . . . but we’re 100 percent right 50.75 percent of the time,” Mercer told a friend. “You can make billions that way.”

The goal of quants like Simons was to avoid relying on emotions and gut instinct. Yet, that’s exactly what Simons was doing after a few difficult weeks in the market.

By the summer of 2019, Renaissance’s Medallion fund had racked up average annual gains, before investor fees, of about 66 percent since 1988, and a return after fees of approximately 39 percent.

Another lesson of the Renaissance experience is that there are more factors and variables influencing financial markets and individual investments than most realize or can deduce.

Simons and his colleagues generally avoid predicting pure stock moves. It’s not clear any expert or system can reliably predict individual stocks, at least over the long term, or even the direction of financial markets.

“Work with the smartest people you can, hopefully smarter than you . . . be persistent, don’t give up easily. “Be guided by beauty . . . it can be the way a company runs, or the way an experiment comes out, or the way a theorem comes out, but there’s a sense of beauty when something is working well, almost an aesthetic to it.” 
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Tuesday, 3 December 2019

Education of an Investor

In the last webinar I conducted for the members of Intelsense advisory, there was a question on what should one read to start off and become a better investor. 

 I took some time and have identified some books, courses, magazine, newspapers that can help you in learning more about investing. I have categorized them so that you can pick and choose. Of all the books I have read over the years, these are the ones I have found useful and have read most of them more than once. 

 The list is big. But do not get overwhelmed by it. Remember, this is not school homework you need to finish in a timebound manner. Go through them slowly but methodically. 

 I have found that reading every day for a fixed period, say 30 mins, at a fixed time, makes it easier to form and stick to the reading habit. Also, importantly, do not feel compelled to complete a book. If you do not like a book or feel it is not adding much value to you, feel free to skim through or put it down all together and move on to the next one.

 Lastly, this is by no means a comprehensive list and I may have missed some very good books. If you think there are any that I have missed, please let me know.

 So, here goes the list.
 Building the Base
1. Rich Dad, Poor Dad – Robert Kiyosaki
2. One Up On Wall Street – Peter Lynch
3. The Most Important Thing Illuminated – Howard Marks
4. Margin of Safety – Seth Klarman (only pdf available; google for pdf; book out of print)
5. The Warren Buffett Way - Robert Hagstrom
6. Fooled by Randomness – Nassim Taleb

Fundamental Analysis
1. Beating the Street – Peter Lynch
2. The Five Rules for Successful Stock Investing - Pat Dorsey
3. Capital Returns – Edward Chancellor
4. Contrarian Investment Strategies: The Next Generation - David Dreman
5. How To Lie With Statistics – Darrell Huff
6. The Financial Numbers Game Detecting Creative Accounting Practices – Charles Mulford, Eugene Comiskey
7. The Art of Execution – Lee Freeman-Shor
8. The Manual of Ideas – John Mihaljevic
9. The Investment Checklist - Micheal Shearn
10. Common Stocks & Uncommon Profits – Philip Fisher

Valuation
1. Aswath Damodaran course on valuation https://www.youtube.com/watch?v=znmQ7oMiQrM&list=PLUkh9m2BorqnKWu0g5ZUps_CbQ-JGtbI9
2. Financial Statement Analysis and Reporting from IIT Roorkee  - https://www.youtube.com/channel/UCw4SlTWA7bpiUK-b6FssPlg
3. Financial Statement Analysis and Security Valuation  - Stephen Penman 
4. Investment Valuation - Aswath Damodaran.

Technical & Quantitative Analysis
1. What Works on Wall Street – James O'Shaughnessy
2. Quantitative Value – Wesley Gray, Tobias Carlisle
3. Quantitative Momentum – Wesley Gray, Jack Vogel
4. Dual Momentum Investing – GaryAntonacci
5. The New Trading for a Living - Alexander Elder
6. How to Make Money in Stocks – William O’Neill
7. Technical Analysis of The Financial Markets – John Murphy
8. Come Into My Trading Room - Alexander Elder
9. Mechanical Trading Systems – Richard Weissman 
10. Trade Like A Stock Market Wizard – Mark Minervini
11. Trend Following – Michael Covel

Investing Psychology
1. Poor Charlie’s Almanac – Peter Kaufman
2. Against the Gods: The Remarkable Story of Risk – Peter Bernstein
3. Influence by Robert Cialdini
4. Drunkard’s Walk – Leonard Mlodinow
5. Little Book of Behavioral Investing - James Montier
6. Psychology of Intelligence Analysis – Richards Heuer
7. Think Twice: Harnessing the Power of Counterintuition – Michael Mauboussin
8. More Than You Know – Michael Mauboussin 
9. The Disciplined Trader - Mark Douglas

Other Reading
1. Seeking Wisdom - Peter Bevelin
2. Tap Dancing to Work – Carol Loomis
3. The Market Wizards (all the books in the series)- Jack Schwager
4. Reminiscences Of A Stock Operator – Edwin Lefevre
5. The Ascent of Money - Niall Ferguson
6. Zurich Axioms - Max Gunther
7. The Snowball – Alice Shroeder
8. When Genius Failed – Roger Lowenstein
9. Deep Work – Cal Newport
10. The Personal MBA – Josh Kaufman

Magazines, Newspapers, Blogs
1. https://www.fs.blog/blog/
2. http://www.collaborativefund.com/
3. https://fundooprofessor.wordpress.com/
4. http://blogs.cfainstitute.org/
5. http://hbr.org/
6. http://knowledge.wharton.upenn.edu/
7. https://www.brainpickings.org/
8. http://investorfieldguide.com/
9. www.thinkmentalmodels.com
10. http://www.tweedy.com/research/papers_speeches.php
11. https://www.project-syndicate.org/
12. http://qz.com/
13. https://www.nytimes.com
14. https://www.bloomberg.com/
15. https://www.theguardian.com/uk/business
16. Forbes India
17. Outlook Business
18. Business Today
19. Business Standard
20. Mint
21. Economic Times
22. The Economist
23.   http://www.investopedia.com/university/all/basics/
24.   https://zerodha.com/varsity/

As Munger always says, investing is simple, not easy! Hope this helps.
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Monday, 2 December 2019

Why India Boomed? And Why Are We Now In Trouble?


The Indian economy is in bad shape. All the macro indicators and fast-moving indicators show this at this point in time. Every news article or program in the media is highlighting this.
Let me take a step back to analyze how and why India boomed and what are the factors that are changing today.

My hypothesis is that India's boom was initiated and driven by the IT sector for the major part. It all started with the rise of the It companies like Infosys, Wipro, TCS. These companies hired young Indians out of college and paid them salaries which were in multiples of the traditional industries at the time. Another important point is that these companies hired in very large numbers. At no time in industrial India, had such large number of middle class educated Indians got such highly paid jobs. All labour intensive industries in the past had low salary levels. The fortunes of the companies and its employees kept being boosted by a continuously depreciating rupee over the years.

A fair number of people went abroad and brought back their saved dollars. They also brought back a yearning for products and services of global standards. They got used to eating at McDonalds and Pizza Hut, shopping at Walmart and Amazon, driving cars. Back to India, they were looking to replicate their US lifestyle in India.

With the opening of the economy in the 90s, some of these global companies also started coming to India. Indian industry also picked up cues from the global ecosystem and started improving their quality standards. This period also coincided with the starting of cable TV in India. Suddenly, a much larger section of people started getting exposed to the latest happenings, fashions, products, services and lifestyles of people across the world.

The combination of significantly higher purchasing power in the hands of many at the same time and global aspirations is what started the consumption boom.

The real estate sector was one of the first to get seriously benefited. The skylines in cities like Bangalore, Hyderabad, Pune, NCR started changing completely. The secondary and tertiary job generation from this consumption-led growth kept fueling the Indian economy. The other fallout of the IT boom was that other industries had to start paying higher salaries to retain and attract talent as everyone made a beeline to the IT companies.

India became a global IT services powerhouse. We were acknowledged to the global leader. Books such The World is Flat by Thomas Friedman further cemented the perception of Indian domination in the knowledge economy in global minds.  The fact that we missed the bus completely on higher-value products and platforms is a topic I am reserving for another day.

There was another softer aspect of this global domination in IT services. India became a “known” entity for the global business people. No longer were we a country of elephants and snake charmers. This mindshare within global business leaders helped the BPO industry and later the Pharma industry walk on the same footsteps of the IT industry did with considerable success. The same is now happening in the Chemicals industry where India is becoming a country of choice for global players.

The last few years has not been very good for the Indian IT industry. Growth has tapered. Downsizing in large companies has been consistently in the news and on social media. Employees, especially mid and senior level, are not as secure in their jobs as they were a decade back. Salary increments have reduced from twenty-thirty percent a 10-15 years back to single digits in the last few years. Starting salaries for employees have not gone by significantly in the last 10-15 years. Obviously, if the largest high-paid “labour-force” in the country are concerned about their jobs or are not very confident of increments, it will take a toll on consumption. It will, in turn, have a cascading effect on other allied services.

So, what is the way out? How can the economy actually do well? What is needed is a second wave of employment generation like what we saw in the IT boom years. Where can it come from? The way IT industry is looking, it will no longer be able to boost economic growth. It is now a stable, mature industry which has lost the ability of large-scale new employment generation. We need to start looking at new age sectors – electronics, education, healthcare, pharma and tourism.

These sectors have the potential for large scale stable employment generation. Just as an example, inviting global schools and colleges into India could help boost the perception in the education sector. Similarly, making it easier to open and run medical colleges and hospitals in district towns, can also be a long-term game. A little focused effort, with some policy interventions and tax incentives to nudge entrepreneurs in the desired direction is needed. Both industry and government need to prioritize stable employment generation across sectors for the economy to do well once again. There is no other way.

Disclaimer: The author is the Founder and Chief Equity Advisor at www.intelsense.in and nothing in the article should be construed as financial advice.


This article first appeared in The Economic Times - https://economictimes.indiatimes.com/markets/stocks/news/india-boomed-how-why-we-lost-the-plot-on-the-high-growth-path/articleshow/72291116.cms
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Saturday, 30 November 2019

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.

A self-declared space nation called Asgardia is planning a fully functioning space economy
The Space Kingdom of Asgardia is a genuine project to set up a nation entirely in space, with hundreds of thousands of members paying "residency'" fees and a parliament that is in the process of forming the foundations for its society. Asgardia's goal is to transport thousands of people to an enormous space station by 2043, beyond Earth's jurisdictions, to "build a new democratic society." Ambitiously, the space nation is looking to the likes of Tesla CEO Elon Musk and Amazon CEO Jeff Bezos to get them there. Both billionaires have also set up commercial space firms.

It's counterfeit we consume
One estimate of India’s total counterfeit market is Rs 1 trillion. The dummies are often mixed up with originals at the delivery point to escape easy detection. Companies are often reluctant to go public with the fact that the bazaar could be awash with fakes of their brands, though it’s ubiquitous and affects all brands. Interviews with dozens of brand surveillance officials of top companies reveal an estimate: some 25 to 40 per cent products of every available brand is allegedly counterfeit.
The span of fake branded goods takes in a wide variety—besides tea, salt, spices, ghee, paneer and the like, and toothpaste, shampoo, hair oil, conditioner, bathing soap, there’s ­mobile phones, computer hardware, apparel—and yes, liquor. And most dangerously, pharmaceuticals. 
E-commerce offers no immunity. Many reports point towards the large-scale presence of counterfeits in onl­ine buying. The authorised attorneys of some top companies admit some 40-50 per cent of products sold online via top e-commerce sites are fake. They declined to be quoted officially. Smuggling, especially from China, is another route for supply of counterfeits in India.

India to get its second Lion sanctuary
Located in north Madhya Pradesh, Kuno was one of the hunting grounds of the royal families of the region and was notified as a sanctuary in 1981. It has been 29 years since Kuno Palpur was identified as the site for the relocation of Asiatic lions, from their last habitat in Gujarat, to protect them from extinction. Currently, there are 523 (as per the last census carried out in 2015) lions in Gir and this relocation project was supposed to have been completed by 2020. Catastrophes such as an epidemic, an unexpected decline in prey, natural calamities or retaliatory killings could result in the extinction of the lion population when they are restricted to single populations. Gir in Gujarat is the last refuge of the Asian lion population.
Expecting approximately a realised growth that has been observed for recovering tiger populations, along with supplementation every four years from Gir; the lion population in Kuno WLS should reach the current carrying capacity of 40 within 15 years.
To reach the required self-sustaining population size of 80 lions, the time required would be close to 30 years.

Online advertising - is it all mumbo jumbo?
A friend asked me to read up on Affle and also on the online advertising space. This article is a fascinating one and exposes how a lot of metrics around online advertising is just hogwash.
For more than a century, advertising was an art, not a science. Hard data didn’t exist. You put your commercials on the air, you put your brand in the paper, and you started praying. Would anyone see the ad? Would anyone act on it? Nobody knew. In the early 1990s, the internet sounded the death knell for that era of advertising.

Data will take over the world
Yuval Noah Harari is one of my favourite authors. He has a crystal clear mind and extraordinary writing ability where he can make complex subjects appear simple. Here he talks about how authority will shift from humans to Big Data and how authority has historically shifted over time.
For thousands of years, humans believed that authority came from the gods. Then, during the modern era, humanism gradually shifted authority from deities to people.
Now, a fresh shift is taking place. Just as divine authority was legitimised by religious mythologies and human authority was legitimised by humanist ideologies, so high-tech gurus and Silicon Valley prophets are creating a new universal narrative that legitimises the authority of algorithms and Big Data. This novel creed may be called “Dataism”.

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Friday, 22 November 2019

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.


1) Forget 5G, China is starting to look at 6G!!
The world has barely started using 5G, the latest generation of wireless connectivity, but China is already looking ahead to 6G. 5G and 6G refer to the fifth and sixth generation of mobile wireless networks. While 5G is known to have data transmission speeds at least 10 times greater than 4G, rolled out in 2009, it’s too early to say what 6G could be, or what sorts of technologies it would advance. By officially announcing the development of 6G technology, China could cause more consternation in the US national security community over China’s tech capabilities—and lead to more scrutiny of Huawei. While the ministry did not name any of the companies involved with the development of 6G, it’s a fair guess that a national tech champion like Huawei would be on that list.


2) The side-effects of a SoftBank funded economy
Last year, a hospitality start-up called Oyo told that it would turn the Four Sight into a flagship hotel for corporate customers. It guaranteed monthly payments whether the rooms were booked or not, as long as he rebranded the property with Oyo’s name and sold the rooms exclusively through its site.
But corporate guests did not materialize, and Oyo stopped making the payments. Now he is on the verge of eviction.
Many of the young companies used SoftBank’s cash to dangle incentives and other payments to quickly attract as many workers as they could. But when they failed to make a profit and SoftBank changed its tune on growth, the companies often slashed or reneged on those same incentives.
SoftBank’s Vision Fund is an emblem of a broader phenomenon known as “overcapitalization” — essentially, too much cash. Venture funds inundated start-ups with more than $207 billion last year, or almost twice the amount invested globally during the dot-com peak in 2000, according to CB Insights, a firm that tracks private companies.
Flush with the cash, entrepreneurs operated with scant oversight and little regard for profit. All the while, SoftBank and other investors have valued these start-ups at inflated levels, leading to an overheated system filled with unsound businesses. 


3) Google to launch Cache - a effort to expand their payments business to banking
Google is teaming up with two banks, Citigroup and the Stanford Federal Credit Union, to begin offering a “smart checking” account next year. 
For a new product or service to succeed, it has to offer something new and shiny enough to motivate consumers to leave their existing provider.
As people grow more wary of entrusting their personal data to tech companies, persuading them to hand their checking account over to a partnership involving Google may be a hard sell. And customers typically switch bank accounts only when they’re offered something financially valuable, like lower fees, more attractive rewards for spending or higher interest rates. Google and its partners haven’t commented on what kind of terms they might offer.


4) TikTok is taking over India's social media scene
In just two years, TikTok has become India’s most downloaded app. It’s shaping a new youth culture in which millions of young people—in big cities and small villages alike—are trying to be TikTok’s next big star. The results are both magical and nightmarish.
More than half of India’s 1.3 billion people are under the age of 25, and more than 500 million Indians use the internet today, thanks to the growing penetration of cheap smartphones and mobile data. But not all of them can express themselves through neatly worded tweets or self-deprecating captions on Instagram posts. In fact, a large section of India’s first-time internet users—some of them illiterate, others speaking in local dialects—find navigating video-based platforms easier. From 2012 to 2018, the time spent by an Indian watching online videos grew from an average of 2 minutes a day to 52 minutes a day, according to a report by the media agency Zenith.


5) Hiring from tier-2 / tier-3 colleges
When building up his team Jack preferred hiring people a notch or two below the top performers in their schools. The college elite, Jack explained, would easily get frustrated when they encountered the difficulties of the real world.
Graduates from tier 2 or tier 3 schools have a hunger to over-compensate for what they perceive they lack. They have seen their counterparts from larger cities with ‘privileges’ and they want to achieve all that and more. Therefore, they are far more driven.
New entrepreneurs told me about a lesser-known problem with good students, especially those who have been top performers since kindergarten: They don’t know what it is to fail. To build something truly big, a start-up founder needs a team that can handle failure.

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