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How to decide what is the most important thing to work on?

Much of life boils down to figuring out a path for yourself and then getting yourself to actually walk it.   It’s easy to dismiss either half of the problem. If the path seems obvious, you might think everyone who fails to walk it is simply lazy. Or perhaps you can’t find the path, so it seems everyone walking forward is a delusional striver.   But both halves of the problem interact. We often fail to stick to our plans because we’re not confident in our chosen path. And we fail to find paths forward because we don’t try enough things to find our footing.   Decision and action are always combined. The challenge is taking the next step. https://www.scotthyoung.com/blog/2022/03/21/decide-what-work/

Know yourself

Investing, now more than ever, is about controlling the controllable. You can’t control the markets. You can’t control the coronavirus. You can control your own behavior, although that requires making accurate, honest predictions about yourself.   Controlling the controllable doesn’t just mean shrugging off whatever is out of your power. It also means putting some calm and serious thought into what is within your power. Your future success may depend less on what markets do—and more on spending a few quiet minutes figuring out who you are as an investor.   Will you be able to keep buying all the way down if the market goes down another 25%—or more? Will you even be able to hold on? Can you stand watching every dollar you had in stocks turn into 50 cents or less?   On the other hand, what if the panic subsides and stocks resume their climb—after you impulsively moved to the safety of cash and bonds that generate almost no income? How badly will you kick yourself over getting out of the market because of fears that didn’t fully materialize? https://www.wsj.com/articles/stocks-are-cratering-control-the-one-thing-you-can-11584055737

Let your mind wander

Losing oneself in one’s thoughts or letting the mind wander is an underrated activity that is more rewarding the more it is practised, an academic study has claimed.   Psychologists who studied a group of more than 250 people encouraged to engage in directionless contemplation or free-floating thinking said that the activity was far more satisfying than the participants had anticipated.   They also revealed that – as previous studies have demonstrated – losing yourself in your thoughts can aid problem solving, increase creativity, enhance the imagination and contribute to a sense of self-worth.   Despite this, most people are more likely to let themselves be distracted than to delve into their own thoughts or just stare out the window. Smartphones have inevitably made it easier to seek and find distraction and have contributed to a loss of the habit of free thinking. https://www.theguardian.com/lifeandstyle/2022/aug/05/contemplation-can-help-problem-solving-and-boost-creativity-study-claims

The influencer's dilemma

Audience capture is an irresistible force in the world of influencing, because it’s not just a conscious process but also an unconscious one. While it may ostensibly appear to be a simple case of influencers making a business decision to create more of the content they believe audiences want, and then being incentivized by engagement numbers to remain in this niche forever, it’s actually deeper than that. It involves the gradual and unwitting replacement of a person’s identity with one custom-made for the audience.   When influencers are analyzing audience feedback, they often find that their more outlandish behavior receives the most attention and approval, which leads them to recalibrate their personalities according to far more extreme social cues than those they’d receive in real life. In doing this they exaggerate the more idiosyncratic facets of their personalities, becoming crude caricatures of themselves. https://gurwinder.substack.com/p/the-perils-of-audience-capture

Don't be afraid of failure, just get started

Inspiration, the admixture of genius and motivation, is sometimes described as a force that strikes us after some patient lull or waiting period. This idleness is a mistake. The Muse arrives to us most readily during creation, not before. Homer and Hesiod invoke the Muses not while wondering what to compose, but as they begin to sing. If we are going to call upon inspiration to guide us through, we have to first begin the work.   Failure is something you want to tempt. You should court it the way the bullfighter courts the bull. When I wish to learn something, I begin with this in mind. A meaningful first project should have sufficient difficulty that there is some real chance of failure. It is in approaching the edges of our abilities that we are really learning, and often simple projects feel more like delaying things, including delaying mastery. A chance of failure ensures your hands are firmly touching reality, and not endlessly flipping through the textbook, or forever flirting only with ideas. https://simonsarris.substack.com/p/start-with-creation

Weekend Reading

 

Intelsense Insights

Quantamental Q30

Quantamental Q30 has been around for more than 2 years and has seen the ups and downs of the Covid crash and rally, Ukraine-Russia war and the tech meltdown and recessionary fears in the US and its impact on the emerging markets. Yet, it has delivered a solid ~34% CAGR over this period. All it requires is 15 mins of time per month to execute. Embrace a completely hands-off systematic approach to investing. You can subscribe to it from here: Smallcase: https://intelsense.smallcase.com/smallcase/INSMO_0003 Directly: https://www.intelsense.in/#!/Subscription

Creating a new history on Wikipedia

Posing as a scholar, a Chinese woman spent years writing alternative accounts of medieval Russian history on Chinese Wikipedia, conjuring imaginary states, battles, and aristocrats in one of the largest hoaxes on the open-source platform.   One of her longest articles was almost the length of “The Great Gatsby.” With the formal, authoritative tone of an encyclopedia, it detailed three Tartar uprisings in the 17th century that left a lasting impact on Russia, complete with a map she made.   One article she tampered heavily with was on the deportation of Chinese in the Soviet Union in the 1920s and ’30s. It was so well-written it was selected as a featured article and translated into other languages, including English, Arabic, and Russian, spreading the damage to other language editions of Wikipedia.   The hoax started with an innocuous intention. Unable to comprehend scholarly articles in their original language, she pieced sentences together with a translation tool and filled in the blanks with her own imagination. “As the saying goes, in order to defend a lie, you must tell more lies,” she wrote. Before long, they had accumulated into tens of thousands of characters, which she was reluctant to delete. https://www.vice.com/en/article/pkgbwm/chinese-woman-fake-russian-history-wikipedia

Many of the things that you believe right now are utterly wrong

At various times throughout the history of humankind, our most brilliant scientists and philosophers believed many things most eight-year-olds now know to be false: the earth was flat, the sun revolved around the earth, smoking cigarettes was good for digestion, humans were not related to apes, the planet was 75,000 years old, or left-handed people were unclean.   Around 100 years ago, doctors still thought bloodletting (that is, using leeches or a lancet to address infections) was useful in curing a patient. Women were still fighting for the right to vote, deemed too emotional and uneducated to participate in democracy, while people with darker skin were widely considered subhuman. The idea that the universe was bigger than the Milky Way was unfathomable, and the fact the earth had tectonic plates that moved beneath our feet was yet to be discovered.   It is challenging to accept the fact that much of what we believe right now will, in 20, 100, 500, or 1,000 years, seem as absurd as some of the ideas above. But it would take a great deal of arrogance to believe anything else. https://www.persuasion.community/p/misinformation-is-here-to-stay-and

The biggest lesson in investing

The biggest lesson is to stay the course and be focused on the long-term. And, when you might have an economic downturn or downturn in markets to think far enough ahead to see that as an opportunity and stay invested. Often the times when you feel most like getting out of the markets is the time when you shouldn’t.   And, when you look back on it, you can barely see Black Monday in terms of the long term chart of equity investment. It will have been many people on that day who decided that investing in equities wasn’t for them, and they will have lost out on a great deal.   So, the biggest lesson I’ve learned is not to panic in the short term. But, try to stay focused and invested and the moments when you feel really, really sick to your stomach, that is almost always the right time to be buying more and getting more exposure to equities in the long term. https://www.livewiremarkets.com/wires/2-the-biggest-lesson-from-35-years-of-investing

On clear thinking by Danny Kahneman

What gets in the way of clear thinking is that we have intuitive views of almost everything. So as soon as you present a problem to me, I have some ready made answer. What gets in the way of clear thinking are those ready made answers, and we can’t help but have them.   We have beliefs because mostly we believe in some people, and we trust them. We adopt their beliefs. We don’t reach our beliefs by clear thinking, unless you’re a scientist or doing something like that. There’s a fair amount of emotion when you’re a scientist as well that gets in the way of clear thinking. Commitments to your previous views, being insulted that somebody thinks he’s smarter than you are. I mean lots of things get in the way, even when you’re a scientist. So I’d say there is less clear thinking than people like to think.   Very quickly you form an impression, and then you spend most of your time confirming it instead of collecting evidence. https://fs.blog/knowledge-project-podcast/daniel-kahneman/

First synthetic embryos created

Researchers have created the world’s first “synthetic embryos” in a groundbreaking feat that bypassed the need for sperm, eggs and fertilisation.   Scientists at the Weizmann Institute in Israel found that stem cells from mice could be made to self-assemble into early embryo-like structures with an intestinal tract, the beginnings of a brain, and a beating heart.   Known as synthetic embryos because they are created without fertilised eggs, the living structures are expected, in the near term, to drive deeper understanding of how organs and tissues form during the development of natural embryos.   But researchers believe the work could also reduce animal experimentation and ultimately pave the way for new sources of cells and tissues for human transplantation. For example, skin cells from a leukaemia patient could potentially be transformed into bone marrow stem cells to treat their condition. https://www.theguardian.com/science/2022/aug/03/scientists-create-worlds-first-synthetic-embryos

Weekend Reading

 

Upfront

Interested in investing in a concentrated portfolio of stocks that help you remain ahead of the curve? One which has outperformed even during the toughest of times? Look no further than the Quiver smallcase from Intelsense. https://intelsense.smallcase.com/smallcase/INSMO_0005

Words of wisdom from Seth Klarman

“I think it’s good to step back from the moment-by-moment noise. Investors sometimes get caught up in the noise, but it’s really important to step back. Investors just should always want to be thinking about their own thinking…we all know we deal with enormous amounts of information we need to filter it down to the useful information.”   “After you buy something you paid for, it doesn’t matter. People cling to the idea that at least they should get their money back; maybe there is bad news, and you should sell before it goes lower; maybe put it into something else where you get your money back, but people prefer to make it back where they lost it. People anchor numbers in their heads, and they hold on to them.”   “A very significant part of my philosophy has to do with managing your psychology. Markets are about the psychology of others.”   “When you focus on return at the exclusion of risk, you try to take more risk to get the return; you get the risk but may or may not get the return. If you focus first on the risk and mitigate or avoid or reduce the risk, then you’ve protected the downside, and then maybe you get the return.” https://thetranscript.substack.com/p/seth-klarman-interview

Make friendship your first priority

Alongside your family, making, cultivating and keeping close friendships may be your life’s most important work.   Yeah, to help your career; building a network is more critical than ever. (I’m the LinkedIn guy, I’m not gonna tell you otherwise). But more than that, friends will be absolutely central to your sense of happiness, connection, and meaning.   Like you, I was able to get a great education, with brilliant faculty teaching enlightening classes. Yet right away it was clear that what would matter much more to me, were my fellow students.   When there’s something important you don’t know, real friends will tell you about it. They might even help you learn it. Your friends can help you see what you can’t see. They’ll help you, you’ll help them, you’ll all do better and go further.   You have a team. Some of your key teammates are your friends. And the ones you share your dreams, fears, and hopes with are the people most able to help you get where you should be going. Because, again: Friends will tell you not what you want to hear but what you need to hear. https://greylock.com/greymatter/reid-hoffman-the-importance-of-friendship/

Timber trading is soaked in blood of the impoverished

Illegal logging destroys habitats, contributes to erosion and the propagation of invasive species, hurts indigenous communities, and interferes with carbon sequestration and the production of fresh air. It’s also extremely lucrative. Timber trafficking generates $50 to $150 billion each year. Around 10 to 30 percent of the international trade in timber is estimated to be illegal; in the tropics, the figure is closer to 90 percent. The business is violent, often tied up with drug smuggling, game poaching, money laundering, and the persecution of indigenous leaders and environmentalists. As U.S. Customs and Border Protection puts it, “The illegal timber trade is soaked with blood.”   Although it is big business, tree poaching is deeply tied to poverty. The forest offers a last-ditch haven for those whom society has failed. https://harpers.org/archive/2022/08/tree-sleuths-how-dna-is-transforming-the-fight-against-illegal-logging

Master the basics

Everyone wants advanced knowledge. But it’s typically the basics that matter most.   Most math is arithmetic, not algebra. Running a business is largely a matter of keeping revenues above costs. Good writing is the product of clear ideas and clean sentences.   All skills break down into elemental components–coding has commands, painting has brushstrokes, comedy has jokes. Mastery of the performance results from mastery of the parts.   We ignore the basics, not because they’re hidden, but because they’re so obvious. Thoughtlessness saves effort but inhibits improvement. Bringing attention back to the basics doesn’t come automatically. We adjust our habits only when they fail to deliver results. https://www.scotthyoung.com/blog/2022/07/25/basics/

One more step towards reducing obesity medically

Wegovy, made by Danish drugmaker Novo Nordisk, is the first in what is shaping up to be a new generation of obesity treatments, which use a hormone to regulate appetite.   Wegovy arrived on the market amid a global obesity crisis. Almost half of Americans are expected to be obese by 2030, a Harvard study found, and that could account for up to 18 per cent of healthcare spending on related conditions, ranging from heart disease and stroke to osteoarthritis. Worldwide obesity rates have tripled since 1975, with 650 million adults obese in 2016, according to the World Health Organization.   When we eat, cells in the small intestine secrete GLP-1, causing the release of insulin, which in turn tempers fluctuations in blood sugar levels. While experimenting with how to create a new hormone, GLP-1-based drug, in the 1990s, Novo Nordisk lab scientists noticed their mice and rats began to lose weight. The hormone’s effect on the brain, they discovered, is to reduce appetite and create a feeling of fullness. https://www.ft.com/content/96a61dc0-249a-4e4e-96a2-2b6a382b7a3b

Weekend Reading

 

Upfront

Interested in investing in a concentrated portfolio of stocks that help you remain ahead of the curve? One which has outperformed even during the toughest of times? Look no further than the Quiver smallcase from Intelsense. https://publisher.smallcase.com/smallcase/INSMO_0005

Quiver Smallcase

Taxes in the ancient world

The first record of organized taxation comes from Egypt around 3000 B.C., and is mentioned in numerous historical sources including the Bible. Chapter 47, verse 33 of the Book of Genesis describes the tax collection practices of the Egyptian kingdom, explaining that the Pharaoh would send commissioners to take one- fifth of all grain harvests as a tax.   Tax practice continued to develop as Greek civilization overtook much of Europe, North Africa and the Middle East in the centuries leading up to the Common Era. The Rosetta Stone, a clay tablet discovered in 1799, was a document of new tax laws decreed by the Ptolemaic Dynasty in 196 B.C.   From the Roman age and through medieval European history, new taxes on inheritance, property and consumer goods were levied, and often played a role in war, either by funding them or provoking them.   Other cradles of civilization, such as ancient China, also levied taxes under the authority of a strong centralized government. The Chinese T’ang and Song Dynasties employed a methodical census record to track their populace and impose the proper taxes on them. These funds and materials were then used to support armies and construct canals for transportation and irrigation, among other projects. The Mongol Empire that took control of much of Asia around 1200 instituted tax policy designed to influence large-scale production of certain goods like cotton. https://onlinebusiness.northeastern.edu/blog/a-brief-history-of-taxation/

Are we ready for solar waste?

India does not have a solar waste management policy, but it does have ambitious solar power installation targets.   Solar waste — the electronic waste generated by discarded solar panels — is sold as scrap in the country. It can increase by at least four-five-fold by the next decade.   Solar panels have a life of 20-25 years, so the problem of waste seems distant. It is likely that India will be faced with solar waste problems by the end of this decade, and solar waste will end up being the most prevalent form of waste in landfills soon.   The large cost gap between recycling and discarding panels in landfills points to an unpleasant truth: The process generates roughly $3 in revenue from the recovery of certain materials.   Recycling a solar panel cost between $20 and $30, according to the National Renewable Energy Laboratory; sending it to a landfill costs $1-2. https://www.downtoearth.org.in/blog/waste/time-s-running-out-is-india-ready-to-handle-34-600-tonnes-of-solar-waste-by-2030–81104

Choose process over goals

Inventing the future is another way of saying “setting goals.” Success, especially in the West, then becomes about achieving those goals. We accumulate accomplishments and call it success. Success is about building a set of daily practices, it is about growth without goals. Continuous, habitual practice(s) trumps achievement-based success.   I think “accomplishments” are traps. Accomplishments, by their very definition, exist only in the past or future—which are not even real things. Pride is the worst of the seven sins and it is closely related to past and future accomplishments. https://www.joincolossus.com/blog/posts/growth-without-goals

Incentives matter

There are few forces in the world as powerful and ubiquitous as incentives. They govern everything from our daily interactions and decisions to our broader organizations and societies.   Charlie Munger, true to his reputation for pithy one-liners, said it best: “Show me the incentive and I will show you the outcome.”   Incentives appear to be uniquely binary: Thoughtfully-designed incentives are likely to create wonderful outcomes. Poorly-designed incentives are likely to create terrible outcomes. Surprisingly, despite their importance, incentives are rarely studied in schools, business programs, or organizations. As a result, humans remain astonishingly bad at establishing appropriate incentives. We consistently create systems that invite manipulation and open the door to unintended consequences. More often than not, we fall into the poorly-designed camp and find ourselves scrambling for answers and quick fix solutions. https://www.sahilbloom.com/newsletter/the-6-principles-of-incentive-design

The process is the destination

We live in a world obsessed with results. We have a tendency to put so much emphasis on whether or not the arrow hits the target. If, however, we put that intensity and focus and sincerity into the process—where we place our feet, how we hold the bow, how we breathe during the release of the arrow—then hitting the bullseye is simply a side effect.   The point is not to worry about hitting the target. The point is to fall in love with the boredom of doing the work and embrace each piece of the process. The point is to take that moment of zanshin, that moment of complete awareness and focus, and carry it with you everywhere in life.   It is not the target that matters. It is not the finish line that matters. It is the way we approach the goal that matters. Everything is aiming. https://jamesclear.com/zanshin