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. If you like this collection, consider forwarding it to someone who you think will appreciate it.
1. 95% of traffic accidents are predictable
Traffic accidents are a misnomer. In fact, over 95% of what happens on roadways is perfectly predictable.
According to Stefan Heck, PhD, CEO of Nauto, a leader in AI-powered advanced driver assistance systems. With the belief that fully autonomous driving is still years away, Heck's answer to the mounting number of collisions and fatalities in 2020 is to help drivers, not replace them. To that end, Nauto's technology underpins sophisticated safety systems for hundreds of the world's top large-scale fleets, and customers are achieving up to an 80% reduction in a collision loss. The company estimates that has translated into over $300 million in savings.
By far, the biggest cause of collisions in commercial fleets (or, in fact, any vehicle) are distractions. We see about 70% of all collisions happen to drivers that are frequently distracted. Fleets with long distances or hours also see large numbers of collisions due to fatigue and drowsiness, often at the end of a long gruelling day of physical labour -- e.g. installations, package delivery. Speeding gets a lot of attention but is actually mostly an amplifier of damage, not the primary cause of collisions.
In 10 years, we will begin to see significant adoption of both EVs (electric vehicles) and AVs (semi-autonomous or what is known as level 2/3 or fully autonomous known as level 4/5) will become much more common. But AV adoption will not be evenly spread. First, they will remain expensive, so they remain a luxury item.
2. Federer's legacy - as a businessman
Federer was on his way to becoming one of the few athletes in history to earn $1 billion during his playing career, a milestone he reportedly surpassed this year, joining Tiger Woods, Floyd Mayweather, LeBron James, Cristiano Ronaldo and Lionel Messi. Federer’s two decades of on-court achievements only begin to account for that stunning total: About $130 million of Federer’s earnings has come from official prize money, a figure that puts him second on the all-time list in tennis to Djokovic’s $152 million. The rest has come through sponsorships, endorsements, appearance fees at tournaments and lucrative exhibition events around the world. Federer’s performance in this domain has been every bit as impressive as his performance on court — perhaps even more so when you consider the disadvantage he started with. Sponsorships and endorsements tend to be easier to acquire if a tennis player comes from a major market like the United States, Britain or France.
Beyond Federer’s lucrative individual pursuits, the Laver Cup has been the primary focus of Team8, the boutique management firm that Federer and Godsick left IMG to form back in 2013. It is an event that, if it prospers, could serve as both a legacy for Federer and a vehicle for him to remain involved in the game as a team captain or organizer.
3. The Art of Reading
Consuming information is not the same as acquiring knowledge. No idea could be further from the truth.
Learning means being able to use new information. The basic process of learning consists of reflection and feedback. We learn facts and concepts through reflecting on experience—our own or others’. If you read something and you don’t make time to think about what you’ve read, you won’t be able to use any of the wisdom you’ve been exposed to.
Active reading is thoughtfully engaging with a book at all steps in the reading process. From deciding to read right through to reflection afterwards, you have a plan for how you are going to ingest and learn what’s in the book.
Books don’t enter our lives against a blank slate. Each time we pick up a book, the content has to compete with what we already think we know. Making room for the book, and the potential wisdom it contains, requires you to question and reflect as you read.
4. The Paradigm for Success
Today’s CEO isn’t just a name and a face; they’re a brand. And they’re encouraging others to be brands too. We’re becoming a society known for what our brand is, not what our character is. And that’s often where hubris — confidence that has morphed into arrogance — begins.
One success after another builds greater self-confidence. But in the same way, increased achievement can skew healthy self-confidence into hubris. Hubristic people can easily become hooked on their own egos, so confident in their own self-importance that they assume they can do no wrong. Naturally, the more wins an individual with the Midas touch accumulates, the less open they are to critical feedback: Why would a winner need feedback when they already have the code to success?
Additionally, as fans and minions (descriptors some celebrity CEOs use to define other people) continue to cheer them on, hubristic individuals typically seek to feed their self-glorifying adulation tendencies. They become intensely focused on repeating their successes, seeking to make the next one ever bigger and better. Finally, the individual ascends (in their own mind) to godlike status, above any rule or order.
Whatever you choose as a marker of success, remember Rory Vaden’s Rent Axiom: Success is never owned; it is merely rented, and the rent is due every day. What price are you willing to pay for success?
5. Happiness and a sense of humour
Researchers have theorized that a sense of humor is made up of six basic variables: the cognitive ability to create or understand jokes, an appreciation and enjoyment of jokes, behavior patterns of joking and laughing, cheerful or humorous temperament, a bemused attitude about life, and a strategy of using humor in the face of adversity. A sense of humor, then, can mean either being funny or enjoying funny things.
Consuming humor brings joy and relieves suffering. However, the type of humor you consume and share matters. Humor can be positive, when it’s not intended to belittle or harm others, or when one laughs at one’s own circumstances. It can also be negative, when it attacks others or when one belittles oneself. Positive humor is associated with self-esteem, optimism, and life satisfaction, and with decreases in depression, anxiety, and stress. Negative humor follows the exact opposite pattern: While it can feel good in the moment, it exacerbates unhappiness.
Laughter itself is what brings a lot of humor’s benefits, not necessarily making other people laugh. Laughter also acts as a social lubricant, making interactions easier even when there is no humor involved.