Top 10 Learnings from Q3 (Part 1)

2019-07-18

• “If you want to be a grocer, or a general, or a politician, or a judge, you will invariably become it; that is your punishment. If you never know what you want to be, if you live what some might call the dynamic life but what I will call the artistic life, if each day you are unsure of who you are and what you know you will never become anything, and that is your reward.” - Oscar Wilde

2019-07-22

• Book Learning from The Art of Learning: The principle of "Small Circles", a look into true depth in your work. As Bruce Lee says: "I fear not the man who has practiced 10,000 kicks once, but I fear the man who has practiced one kick 10,000 times.". In chess, the fundamental principle is central control. You want to control the middle of the chessboard. But when you look at world level Grandmasters play, many appear to ignore this principle and have crazy attacks up the flanks of the chessboard. What appears to be a neglect of the fundamental principle is in fact such a strong embodiment of the principle that they've learned to control the center of the board without appearing to have it to the untrained eye. Very similar to power hitters like Mike Tyson where a knock out punch may not look like a straight power punch but in a small enough circle, it is. This puts the focus on the micro. On the most basic foundations and the journey to find depth in it. One way chess players focus on such depth is to learn chess from the end game first and opening game last. Opening games have increased variability of pieces and noise whereas the end game is merely a handful of pieces (like pawn and king) and such allows for a focus on the smallest circle. A question for myself is: What is the smallest circle for human performance? What is the end game I can look to master and have depth in? Is it incentives? Is it behaviour? Whatever drives behaviour?

2019-08-05

• “The reasonable man adapts himself to the world: the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.” - George Bernard Shaw; Only by working on the self and changing oneself will it become possible to adapt the world. The world is a place driven by FOMO. Conversely, it's repelled by persuasion and so the greatest way for the unreasonable man to change the world is to do that which is reasonable for him but appears unreasonable for the world. The unreasonable world will conform to the man's standard of reasonability as a result of FOMO.

2019-08-08

• Book: Skin in the Game by N.Taleb: A kosher (or halal) eater will never eat non-kosher (or non-halal) food, but a non-kosher eater isn't banned from eating kosher. A disabled person will not use the regular bathroom, but a non-disabled person will use the bathroom for disabled people. A similar rule applies to food labeled organic. A small minority cares for them but people who do not care will also eat organic. Hence, behaviour can also evolve to actually prefer such foods because of the perception that it's better. This phenomenon is the renormalization group. An example assuming immateriality in price differential: In a family of 4, if the daughter only eats organic... the 4 will convert to be all organic only. Then if that family goes to a social dinner, the organizers may make it all organic. Over time, the grocery store notices higher volume of organics so they will start changing % mix of offerings to more organic. Hence, you convert an entire town overtime from the desires of the stubborn minority.

2019-08-12

• Book: Skin in the Game by N.Taleb: Per the minority rule, the intolerant minority is stable. It's stable in that a small minority will influence the rest. Very much like cyanide. A drop of cyanide makes the entire pool of liquid poisonous. Some minorities are tolerant and some are not. If the minority group is intolerant, then you cannot combat it with tolerance. Instead, one must use even stricter intolerance for per the minority rule: the intolerant minority will change the rest to its way. Look at Egypt. The Muslim religion was a minority there but the intolerant minority now has made majority of the country Muslim. "Never doubt that a small group of thoughtful citizens can change the world. Indeed, it is the only that that ever has," wrote Margaret Mead. Revolutions are unarguably driven by an obsessive minority. And the entire growth of society, whether economic or moral, comes from a small number of people. "The average behaviour of the market participant will not allow us to understand the general behaviour of the market".; A betting man is probably better off considering the behaviour of true market movers of each unique market than the average. The market movers of small cap companies are different from the market movers of S&P500 companies. The irrational behaviour of Sally across the street won't impact the market behaviour on Apple's stock. The attitude of pension funds will. Always look at the small minority responsible for the change.