Marvin’s Best Weekly Reads Jan 1st, 2023
“Take the first step in faith. You don’t have to see the whole staircase, just take the first step.” – Martin Luther King Jr.
Happy new year and here is to victory in Ukraine, world peace, prosperity and great health in 2023.
This is a great Xmas story.
A South Korean tour group gets stuck in the snow and is then hosted by a nice American family during the winter storms. So lovely.
Happy Holidays to everyone!
https://www.nytimes.com/2022/12/25/us/snow-storm-korean-tourists.html
2. Recommend watching this and reading his book "Chip Wars". The importance of microchips and Taiwan in the future geopolitics and economic growth.
https://www.youtube.com/watch?v=VffSs0lXhb8
3. "2023 is going to be a very risky year for seed stage startups to accept capital from multi-stage funds (unless they commit to owning 20% of the company)."
4. Lots of insights here on what’s happening on the geopolitical and macroeconomic front.
USA is messing up their management of USD & weaponization of SWIFT and Dollar but every region is in big trouble and we are seeing the end of globalization.
https://www.youtube.com/watch?v=rXFtvi7S2wc
5. This is a good explanation of why there will be massive layoffs in Q1, 2023.
https://mobile.twitter.com/BowTiedPagan/status/1606674645985513474
6. I'm on a Zulauf kick: his message is grim but sounds right.
We are run by corrupt, incompetent idiots in the west. (Woke Left idiots, MAGA morons, they are all the same).
https://www.youtube.com/watch?v=fuKbuhkJ-1M
7. "It is a mistake on our part, I think, to believe there is little connection between physical action and mental thought. The best thinkers are those who take action. No man who never leaves the interior of his house can be expected to have a healthy view of the world.
The best philosophers are those who combine the possibilities of speculative thought with the hard, timeworn lessons learned from participative action in the arenas of life. A stagnant pond produces little more than gases of putrefaction; but a running stream cuts through the landscape, delivering aqueous sustenance to the parched land. It is the gift of life itself."
https://qcurtius.com/2021/04/03/on-why-the-best-philosophers-are-men-of-action
8. Big fan of Simu Liu. His upbringing is similar to many of us kids of Asian immigrants so I certainly understand.
https://www.theguardian.com/film/2022/may/21/simu-liu-shang-chi-kims-convenience-memoir-interview
9. "In one way or another, that mindset has guided Aoki through a singular career. He is ever curious about the opportunity that others are overlooking, because it might seem too small or weird or noisy. Then, he says, he "brings that noise out from the corner and into the masses, and builds a community around it."
He is, for example, among the world's most famous DJs — the rare artist to transcend the club scene and achieve mainstream awareness. But he's also a savvy entrepreneur who absorbed brand-building lessons from his father, the founder of the successful restaurant chain Benihana. Aoki is a celebrated music producer, creator of the record label Dim Mak, as well as a clothing line called Dim Mak Collection that has partnered with the likes of Adult Swim and DC Comics — and he was recently named the "chief music officer" of Orangetheory Fitness (which means he sets the tone for the company's workout classes worldwide).
Lately, he has also thrown himself headfirst into the world of Web3, and has become one of its most vocal, prominent, and successful advocates. Because these days, if you want to talk about the future of business and technology, there is no better synopsis of Web3 than "you have to climb through the noise to find the gem."
10. "One of the opinions he wished to air to those assembled was that “woke-ism”—a belief system that Ramaswamy sees as an insidious secular creed—has overtaken religious faith, patriotism, and the work ethic as a key American value. Corporate virtue-signalling and hypocrisy are everywhere, he told the audience. “Let’s muse about the racially disparate impact of climate change as you fly on a private jet to Davos,” he said, to laughter from the nearly all-white crowd.
C.E.O.s were recruiting “token” people of color for their boards in the name of diversity while refusing to seek out diverse points of view. The Walt Disney Company was self-righteously protesting Florida’s “Don’t Say Gay” law after cutting deals with the repressive Chinese government to film footage for “Mulan” in Xinjiang.
To Ramaswamy, such corporate do-gooderism—and especially environmental, social, and governance investing, known as E.S.G.—is a smoke screen designed to distract from the less virtuous things that companies do to make money."
https://www.newyorker.com/magazine/2022/12/19/the-ceo-of-anti-woke-inc
11. One of the best macro observers in the world here.
"You’re bullish on emerging markets?
Yes, plus Japan. Japan and China are each other’s biggest trade partners. Japan exports a lot of things that China wants, including automobiles but also tourism. Pre-Covid, tourism was 7% of Japanese GDP, and most of it was from China.
When we talk about emerging markets in general, it’s important to look back to 2022: The three key themes in the past year were, one, a much tougher Fed, two, a much stronger dollar, and three, lockdowns in China. If one year ago we had told ten investors that these would be the key themes in 2022, what do you think they would have said about emerging markets?"
https://themarket.ch/english/louis-gave-we-will-see-a-boom-in-emerging-markets-ld.8118
12. Fascinating. In America, everything is business, even Christmas trees.
"Christmas trees are big business in New York. A lot of people see the quaint plywood shacks that appear on sidewalks just before Thanksgiving, each with its own tiny forest of evergreens, and they imagine that every one is independently owned, maybe by jolly families of lumberjacks looking to make a few holiday bucks. That’s what I thought, anyway.
In reality, a few eccentric, obsessed, sometimes ruthless tycoons control the sale of almost every single tree in the city. They call themselves “tree men,” and they spend 11 months a year preparing for Christmastime — which, to them, is a blistering 30-day sprint to grab as much cash as they can."
https://www.curbed.com/article/christmas-tree-trade-secrets-gregs-trees-nyc.html
13. Good way to prepare for 2023! Very motivating.
https://www.youtube.com/watch?v=b31dko8Ek8Q
14. I am not a fan of this guy nor his politics (I’d go so far to say I detest him right up there with Tucker Carlson). But this is a very sober write up of what a crime ridden mess the USA has become. Mainly due to nutty Woke Left.
https://mikecernovich.substack.com/p/brace-for-impact
15. "Instead, the better way to get rich is to build out based on your talent/skills. Coca-Cola will stand the test of time, the latest fashion fad will not.
Accepting painful truths is something that only resonates with the elite since they are self-aware (focused on self evaluation and improvement). They know that life is easier if you’re attractive (source), they know they can’t replicate Usain Bolt genetics and go win the Gold Medal if they “train hard enough” and they know that they should follow what they are good at, not what they are “passionate” about. (Typically, passion just means you’re aware you’re not good at it and simply enjoy it anyway).
Simple Formula: After you get your regular high paying career (Wall St, Tech or Sales) you have to immediately find what you’re good at: 1) are people going out of their way to tell you that you’re good at X? If so that’s a sign,
2) is that skill going to be of value in 5-10 years? If so, you already have the direction that you should go and
3) *bonus* if you don’t enjoy it that’s actually a *good* thing. You will optimize for business success not how you “feel” which ironically makes you harder to compete against…. You only make smart financial decisions."
https://bowtiedbull.substack.com/p/why-you-wont-get-rich-making-top
16. "When a nation has won its freedom through a horrific and bloody sacrifice, defending others on the Continent in the process, it can’t be stood aside and told it’s a peripheral state. A victorious Ukraine will thus claim its place in Europe by the sheer magnitude of its sacrifice, while both the U.S. and the European nations that played a key role in its victory — especially those along NATO’s eastern flank — will become that much more influential.
Putin’s folly to go all out against Ukraine has set in motion a process that can’t be reversed. And it isn’t just that Europe’s center of gravity will shift northeast, but also that the once-nebulous concept of Eastern Europe as a backwater of the West — an image reinforced by the Balkan wars of the 1990s — has been all but dismantled."
https://www.politico.eu/article/ukraine-battle-over-future-europe
17. "The financial gains from Nogara's work will have been dispersed into many different sections of the Vatican and the wider Catholic Church, but the wisdom that we can glean from his work remains right there.
Just some aspects of Nogara's strategy that any private investor can learn from or be inspired by include the following:
-Refusing any constraints on where and how you can invest? I'd call that one of the cardinal rules you need to adhere to in order to grow and protect your wealth.
-Building up specific sector competence? Always a good idea!
-Educating yourself about geopolitical risks and how to avoid issues such as custody risk? During the tumultuous 2020s, these are subjects that everyone needs to be aware of.
As this review of Nogara's work shows, many aspects of being successful in investing don't really change over time. An organisation that has survived 2,000 years of humanity's chaos will be first to realise that there are timeless principles that never change.
No other single individual, Pope or Cardinal ever gave as much impetus and muscle to Vatican finances as Nogara."
18. This is an old one but boy, I love a good prank. This one on David Beckham. Still laughing.
https://www.youtube.com/watch?app=desktop&v=bF014EUJrSI
19. I so want one of these now. Japanese beef croquettes with a 30 year waitlist.
https://edition.cnn.com/travel/article/japan-kobe-beef-croquettes-30-year-waitlist/index.html
20. "The wars, the enemies, change. There is one constant however, from the beginning of mankind: your bloodline. This is the true struggle. This is why you must strive for superiority. I doubt many have read Frank Herbert’s God Emperor of Dune, but in book — which takes place a couple thousand years after the original book — the God Emperor says he wants to teach mankind a lesson they will remember in their bones.
What lesson is this? A great fear born from prescience(vision of the future) he had was mankind being destroyed by a dark threat because they had failed to do what they were meant to do.
I too, want to teach mankind a lesson it will remember in their bones.
The lesson is much the same. You can’t get comfortable. You can’t settle for the trad life or retvrn to some other era. You’re born into this time and you must bravely go forward. The strength of mankind, the reason we’ve established superiority over the whole of the earth, is our ability to master space. To master the conditions were born into and continue the fight started by our Fathers."
https://resavager.substack.com/p/the-way-of-the-fathers
21. This is sad. The Hong Kong I used to know and love has been destroyed by China and the CCP.
Also why I'll never go back there again like Noah.
https://noahpinion.substack.com/p/repost-i-will-never-get-to-go-to
22. "Nothing comes from nowhere. Not success. Not inspiration. Not the muses. Not writer’s block. Everything is a lagging indicator. Of whether or not you did the work."
https://ryanholiday.net/all-success-is-a-lagging-indicator
23. "Despite signals in some capitals suggesting that this period may represent an opening to negotiations, present conditions make this proposition unlikely. There is no stalemate on the ground, and neither side is willing to revise its minimal war aims. Ukraine has been winning since August. A ceasefire at this stage would largely benefit Russia. Past experience suggests Moscow will use it to reconstitute forces after several months, and renew the war.
Furthermore, a premature cessation of hostilities is only likely to ensure a continuation war, as neither side in the conflict would achieve their war aims. This is not to say that negotiations are imprudent at a later point, or that attempts to think through how this war ends and manage escalation are misguided. Even in the event of a decisive Ukrainian victory, Putin may not acknowledge defeat, and continue a war of attrition.
Ukraine remains relatively advantaged in this war, although said advantage is not predictive of outcomes. What worked up until this point in the war may not yield the same benefits without adjustments to training, capabilities provided, defense industrial production, and rates of ammunition consumption.
The course of events thus far has been far from overdetermined, but Ukraine’s military has consistently over performed, proving more competent and better motivated, while the Russian military underperformed relative to expectations."
https://ridl.io/the-russo-ukrainian-war-ten-months-in-taking-stock
24. Last NIA episode of the year. Always a good show.
https://www.youtube.com/watch?v=yyOsJ3YmxnU
25. "Despite numerous examples of poor conditions, minimal training, delayed payments, faulty equipment, incompetent leadership, and other problems (including a mass shooting at a training range), mobilized soldiers are providing Russia with more manpower. They’ve enabled the Russian military to stabilize vulnerable lines and conduct a withdrawal from Kherson. Poorly trained soldiers are of minimal value in offensive operations, as Russian infantry attacks at Bakhmut suggest, but it is easier to train someone to man a defensive position.
Even elite units, such as the Russian Airborne Forces’ 331st Airborne Regiment and 155th Naval Infantry Brigade, are receiving mobilized soldiers as combat replacements. This is a significant vulnerability for Russia, but, thus far, mobilized soldiers appear to be more of an assetthan a liability, though there is undoubtedly variance.
The extent to which Russia can create semi-effective mobilized units or successfully integrate mobilized soldiers into existing units will be an important factor in how effectively Russia can sustain this war, particularly during the winter. If Russia fails to train, lead, and integrate mobilized soldiers properly, Ukraine may find an opportunity to achieve another breakthrough when the weather and ground conditions improve."
https://www.fpri.org/article/2022/12/how-the-battle-for-the-donbas-shaped-ukraines-success
26. Interesting discussion for global macro investors. Tracking shipping data. Neat newsletter.
https://mailchi.mp/aed28517f51c/a-different-perspective-and-a-note-on-inflation?e=123a1c25c4
27. I really am behind on these things. Xmas break is for catching up on fun, somewhat useless but kind of random things. Kitsune Dansu. But it’s become a cultural phenomenon.
28. So happy to see this turnaround.
"Of course, there’s a lesson here. And it’s not just for books. You could also apply it to music, newspapers, films, and a host of other media.
But I almost hate to say it, because the lesson is so simple.
If you want to sell music, you must love those songs. If you want to succeed in journalism, you must love those newspapers. If you want to succeed in movies, you must love the cinema.
But this kind of love is rare nowadays. I often see record labels promote new artists for all sorts of gimmicky reasons—even labels I once trusted such as Deutsche Grammophon or Concord. I’ve come to doubt whether the people in charge really love the music.
Maybe they once did, but at some point they lost faith in the redemptive power of songs. That’s the only explanation I can give for what they’re doing. Instead they put their faith in something else—maybe a brand licensing deal, or a fashion line tie-in, or a human interest story. Or maybe they just decided that money talks, and began making creative decisions based on discounted cash flow projections.
But here’s the problem. If you don’t really love the music (or books or newspapers or cinema or whatever), those cash flow projections turn out to be wrong. That’s because creative fields like music and writing live and die based on creativity, not financial statements and branding deals."
https://tedgioia.substack.com/p/what-can-we-learn-from-barnes-and
29. Great thread for new and old VCs.
Lots of good lessons & thoughts for becoming better at this.
https://twitter.com/schlaf/status/1608870554668523520
30. We should be very aware that we are in gray war now with China and Russia.
"Foreign aggressors like Russia and China target fault lines in the US, such as racial tensions, to polarize society and incite chaos. It is paramount for politicians on both sides of the table to unite to protect our shared values.
Moscow and Beijing already claim to believe the US is waging an information war against them. If only that represented the reality on the ground."
https://nypost.com/2022/12/27/russia-and-china-are-fueling-web-wars-to-divide-americans
31. "There is simply no way to beat Larry Ellison in an open auction. It was a contest between two non-billionaires and a billionaire 28 times over. This left only one option for Lacob and Guber: They had to give Chris Cohan an exploding offer.
The “exploding offer” tactic has been deployed by many an NBA general manager, some rather infamously. Take this now, or it goes away forever. Take this offer to someone else and it ceases to exist as an opportunity, much less leverage. It can be a bold play, and sometimes a called bluff. But if you’re desperate enough, it’s the only play that’s right. And Lacob-Guber were desperate, after having missed out on prior teams."
32. Max Blumenthal and his Grey Zone are paid Russian shills so be wary of what they write. It’s a more blatant example.
Although I should note you should be wary of ALL media in general.
Do your homework and think for yourself.
https://jeffreycarr.substack.com/p/trolling-for-putin
33. "On its surface, the liquidation preference looks like a “heads I win, tails you lose” situation for the investor. The liquidation preference was designed with an intent towards alignment and downside protection. It doesn’t end up mattering if the price of the equity continues to rise, and the business is ultimately successful with a favorable acquisition or public listing. And here’s how to think about downside protection.
Say you’re an investor and you invest $1M at a $10M post-money valuation. You now own 10% of a startup. If there is no liquidation preference, the startup could get sold for $5M 2 months later, and the founder(s) could take home $4.5M, and you have now lost $500K. Naval points to an even more extreme example here – the founder could dissolve the company after you wire the $1M, distribute the proceeds, and just give you $100K (10%) back.
Ok, again – why did I write this? Because the liquidation preferences written into term sheets in 2020 and 2021 will come into effect – there will be (more) down rounds, wind-downs, and less-than-appetizing acquisitions. This is the unfortunate reality due to the degree of over-capitalization and dearth of product-market fit."
https://aashay.substack.com/p/the-liquidation-preference
34. 2023 predictions are always fun. I hope he is right, especially in this case.
"The Situation Room and Tucker Carlson are incentivized to tell us “America is awful, news at 11.” Their apocalyptic vision is misguided, bordering on delusional, as we are in a position of strength relative to our global peers: Over the past two years our stock market has outperformed China’s by 30%. Our inflation rate, while high, is nowhere near those of European nations including Germany (10%+), the U.K. (11%+), and Italy (12%+).
We are energy and food independent and have again demonstrated our mastery of the world’s master: technology (see above: re-creating the sun). Nobody is lining up for Chinese or Russian vaccines. The U.S. has pledged $47 billion in military aid to Ukraine, greater than the combined contribution of every other country."
https://www.profgalloway.com/2023-predictions
35. These are good predictions for Crypto. I'm still a believer as we see many of the crooks and get rich quick crowd disappear, while the builders continue to build.
https://davidphelps.substack.com/p/10-crypto-predictions-for-2023
36. This is a great crash course on good VC thinking. Worth a read.
https://investing1012dot0.substack.com/p/having-a-conversation-with-yourself
37. "Decide what your main priority is and then cut something else down to create more time for priority number 1. If your main priority is making money? Sorry. You don’t get to look at mansion tours or supercars on the internet.
You should be focused on staying up to speed on the market. Building your online biz. Automating your career the best you can.
In 2023 during this clear recession, you’ll have another good shot to go up the socioeconomic pyramid. With Assets down if your income is flat you will acquire more assets that the vast majority. As always "wealth is relative”. As white collar workers lose their jobs (they won’t be replaced) you’ll see a bleed in the upper middle class. *Tons* of upper middle class will revert to middle class and there will be a select few who jump from middle class to Upper Middle Class (see the producers/revenue generators)."
https://bowtiedbull.substack.com/p/happy-new-year-and-some-quick-notes
38. I always learn stuff from Brad Gerstner, one of the smartest investors in Silicon Valley. Worth watching.
The long overdue return of truth telling in tech!