Business

  • Learning To Live (and Work) With Millennials

    Simon Sinek is a best-selling author (Start With Why) and gave a Ted Talk on how great leaders inspire action (that got 30 million views). 

    In an interview with Tom Bilyeu (co-founder of Quest Nutrition), he addresses the issue of managing Millennials – and why they seem lazy, entitled, and unfocused.

     

    via Inside Quest

    Sinek points to four characteristics that help "create" this issue:

    • Parenting,
    • Technology,
    • Impatience, and
    • Environment.

    Sinek suggests that this generation is a product of failed parenting strategies … being told they're special without effort, being told they can have anything they want, and being handed trophies for showing up.

    Next, add technology to the mix.

    Before millennials, interaction happened in person much more frequently … meaningful trust-based relationships were built with time and effort, and when you were at dinner with friends or watching a movie, you were living in the moment, not distracted by your phone.

    For added irritation, next add impatience (which is a byproduct of instant gratification).  

    Why wait for amusement when it's a text away?  You've got Netflix making video rental a thing of the past, Tinder making dating as easy as "swiping right" and Amazon making it so you don’t have to check out when you go to a store.

    Is it any wonder that these kids have short attention spans? Now imagine the Gen Z kids forced into quarantine where their only companionship was online?

    Now put those kids in an environment where they're forced to realize you can't rush success, and you can't force meaningful relationships. Where they have to put in the effort and stay focused for extended periods of time

    It's a story that often doesn't have a happy ending.

    I thought it would be fun to ask one of them what they thought about it … So I asked my son, Zachary.  Here are his thoughts.

    I was born in 1993. When I was in elementary school, I was already using a computer almost daily, and a lot of my education and entertainment was computer-centric. 

    As such, I am a textbook “Millennial.”

    I use Snapchat too much, I often relax by playing games on my phone, and I am easily distracted. Because of that, I found this interview with Simon Sinek particularly interesting.

    I’m lucky. My dad forced me to work hard and valued my efforts more than my results.  So, while I'm constantly reminded that I'm lucky I'm not working 80-hour days (and being forced to get a haircut every week), I do feel as if I'm a step ahead of many of my peers.

    I still find myself falling into a lot of the "traps" Sinek describes – I'm reliant on social media; I'm frustrated when my effort doesn't transfer into immediate impact; and I struggle to not take my phone out whenever there's not another stimulus keeping me occupied. 

    That being said, I do think the issue is bigger than millennials. It's not just our generation that takes their phones out at meetings and ignores who they're with for someone on their phone. If you pay attention, I'll bet you'll notice that you do it as well. To me, it seems more like a trapping of the era than of a generation. 

    The difference, I think, is that millennials spent their formative years in this environment. This does affect the way we see and interact with the world. But you can watch each generation chastise the youth for the same things as they get older. 

        "This new generation has no respect! They're too reliant on technology, and don't know how to do anything themselves! Lazy and entitled!

    I'm positive I can find similar rhetoric levied against Generation X, Boomers, and more. There's always been resistance to new technologies and the belief that the new generation takes what they're blessed with for granted. I even catch myself judging Gen Z for the same things I remember being judged for as a teenager. 

    Will we ever measure up to your expectations? Perhaps not … because our generations approach the world the world so differently.

    Nonetheless, we are still capable of greatness.  We are still driven to pursue growth, to create new things, and to provide value to our communities.  It's just that we are playing a different game and keeping score a little differently. 2020 brought a lot of that to the forefront of the conversation. 

    Understanding that, in and of itself, can help to close the gap. As we mature and become the main working force, as we become managers and leaders, I think you'll find that a lot of our failings were the symptoms of youth – and have dissipated with age. 

    There's plenty more I want to say, but I don't want to go on for too long.   I'm happy to have a more in-depth conversation offline. You can e-mail me at [email protected] with any thoughts on the subject, any questions, or just to say hello. 

    Thanks. 

     

     

  • Humans Need Not Apply

    While we all know that pop culture representations of AI aren't accurate – I'm still surprised how often I see people who are against Artificial Intelligence. It seems that many people are focus on science fiction's dystopian depictions of sentience and omniscience, while the reality is exciting (and much less scary). 

    In my office, we use a lot of what seems like "futuristic" artificial intelligence approaches to understanding financial markets and enhancing decision-making. Most of my team are technical or data-science specialists that develop and drive the systems that create our systems. Despite the exponential growth of AI and its supporting technologies, I still believe the heart of AI is human.

     The Heartbeat of AI is Still Human_GapingVoid

     

    Of course, I'm not sure how long that will be true.  But I'd bet it remains true for the next 25 years.

    The video below was shot in 2014 and gives a great perspective on how quickly automation, robots, and eventually autonomous robots, are becoming pervasive. 

     

    via CGPGrey

    Automation used to mean big, bulky machines doing manual and repetitive work. Today, however, automation can land an aircraft, diagnose cancer, and trade. I'm fascinated by what is becoming possible … and how, even when the A.I. is little more than an elegant use of brute force, incredible results are becoming commonplace.

    In many cases, the results coming from machines coding other machines are matching or exceeding the work done by humans. 

    And it's only getting better. 

    In the past, innovation created new industries or allowed increased scale … nonetheless, people are worried that the number of jobs the internet and Artificial Intelligence create isn't matching the number of jobs they're making obsolete. 

    According to this study, approximately 50% of jobs will be automated by 2034.

    Personally, I believe that freeing us to elevate our perspective and do more has always been a boon to society. Electricity put a lot of people out of work as well. Nonetheless, look what it made possible.

    To date, human progress has been based on the division of labor. As our society progressed, our jobs have become increasingly specialized. Now, machines will be able to break down complex jobs into simple parts and complete them faster than we can. 

    So, yes, the same technology that's currently creating opportunities could eventually put you out of a job … but it also creates an opportunity for something new.

    There's a lot of change coming, and that can be scary, but there's reason to be excited as well.

    We live in a golden era of innovation, and we have longer life expectancies than ever before. Humans are immensely adaptable, and I'm sure we'll continue to grow to meet the challenges and opportunities we face. 

    The reality is, we've been working symbiotically with "machines" since the very beginning.  Our definition of a "machine" simply continues to improve. It's fractal, and each time the technology we're adopting gets bigger, so does the eventual positive effect on day-to-day life. 

    AI adoption is a big step, but the positive effect it can have on our lives is astronomical. 

    Onwards!

  • Here Are Some Links For Your Weekly Reading – July 11th, 2021

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    Here are some of the posts that caught my eye. Hope you find something interesting.

    Lighter Links:

     

    Trading Links:

  • Enter The Hivemind

    It can be hard to visualize AI.

    You might imagine something based on pop culture references of virtual lifeforms with sentience and free will … but, at least for now, that's far from the truth.

    Here's an infographic debunking 8 common AI myths.

    Modern AI does many things and has many applications, but it's still relatively primitive. It works in the background, silently collecting vast amounts of data, and performs increasing amounts of work.

    AI may not currently compare with the Star Trek character Data, yet it already is transforming our economy at warp speed.  For a recent example, McDonald's is now doing a 10-store pilot replacing their human drive-thru attendants with AI. 

    Some current uses of AI and robotics are genuinely impressive.  Here's a video taking you into "The Hive" a supermarket warehouse run by a "Hivemind" AI. With thousands of "bots" and various other forms of AI and technology, this will give you a glimpse of the future of AI and automation. 

    via Tom Scott

    This system is from Ocado in the UK. If you want more info, here is an article from Forbes about it.

    Pretty cool! 

  • An Insider’s Look at Markets

    Just because we perceive something, doesn't mean it's true.

    Ten people can witness an accident, and all perceive different things. 

    Often, our eyes see, and our ears hear, just what we expect them to see or hear.

    And with news, rumors, and urban myths, it is important to remember that just because many people say something – it doesn't mean it's true either.

    Confirmation bias is dangerous whether we are looking for a reason to do something or not do something.  Likewise, confirmation bias is dangerous whether you are looking to buy or sell. 

    The truth is that humans can make things up … but we also can notice things and infer meanings that aren't there. Sometimes we also assume cause when coincidence is more likely.

    I suppose there was an evolutionary benefit to our ancestors who were able to infer danger before it ate them. Nowadays, it's probably better if we temper those instincts a little.

    Why Do We See Patterns In Random Data?

    The human mind is especially good at finding patterns in data. 

    Often, I believe that I can see a pattern in random data.  OK, I understand that I don't really see patterns in random data; but to me, it seems like there are patterns in the random data. 

    This happens because we don't look at data neutrally.  That means when the human eye scans a chart, not all data points get equal weight.  Instead, we tend to focus on outstanding cases, and we tend to form our opinions on the basis of these special cases. 

    In other words, it is human nature to pick up the stunning successes (or failures) of the method and to overlook the more common performances. It's one of the reasons that I moved from marking up charts myself, to using computers, to leveraging a team of data scientists and advanced A.I. 

    Human fear, greed, and discretionary mistakes make it hard for humans to understand or predict markets. 

    Understanding Markets

    In reality, there is no such thing as a "Market" … It is really just a collection of separate traders – and only some are human.

    One of the reasons that markets experience great volatility is that different groups buy or sell for different reasons at different times.

    Consequently, even if one group trades using a consistent set of rules, a strategy that effectively combats it only works until that group stops trading those rules.

    And though there are "patterns" in trading, they're essentially random to you or me. Because they can happen in different time frames, or scales, or orders. 

    I shot a video that goes into more detail.

     

    Conclusion

    In trading, predicting markets is much different than using math and statistics to measure the performance of a technique (or a library of techniques). If markets are random, why waste even a minute trying to predict random. Instead, figure out something valuable that you can predict or know.

    While I often believe I see patterns in markets, I know better than to make trading decisions off of those perceptions. 

    The amount of traders is growing, the diversity of traders is growing, and the speed at which trades are made is growing. As a result, there's more confusion, more volatility, and more noise. 

    It's all about finding the signal from the noise, and making finer distinctions – because if you don't know what your edge is, you don't have one. 

    Hope that helps. 

  • Here Are Some Links For Your Weekly Reading – July 5th, 2021

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    Here are some of the posts that caught my eye. Hope you find something interesting.

    Lighter Links:

     
     

     

    Trading Links:

     
     

  • The First Website And The Spread of The World Wide Web

    When people think about CERN, they generally think about nuclear research, the Large Hadron Collider, and other physics research. 

    But, CERN was also where Tim Berners-Lee invented the World Wide Web. In March of 1989, he published “Information Management: A Proposal” which outlined his vision for what would soon become the World Wide Web.  CERN also had the first website to ever exist. Luckily, they kept the site up and will let you view it in the old school line mode.  

     

    Screen Shot 2021-06-21 at 10.36.26 AMvia CERN

    It's been 32 years since the release of the World Wide Web (the internet is said to be invented 6 years earlier with the invention of TCP/IP). Think how much that one invention has had on the world. 

    Information Gathering 

    I remember being in law school, going to the library and scanning through microfiche (or actual books) to study or do research.

    I remember reading encyclopedias (and photocopying relevant articles). 

    I remember paying for newsletters that were mailed to me (or paying extra for fax delivery).

    Having access to more data or faster delivery was a huge advantage.

    Today, you have all the information you could ever ask for at the tip of your fingers … Google and Wikipedia are just the tip of the iceberg.

    There is almost too much information now.  It is hard to separate the signal from the noise.  It seems like anyone can find justification for almost anything.  The result is lots of data, but too little knowledge.

    Part of what is needed is a way to help people make better decisions about what to trust, what it means, and what to use.

    Social Interaction

    People record every moment, every intimate detail of their lives online, contrasted by a fear of strangers and letting children roam. 

    While riding around the neighborhood on your bike to see if your friends could come out to play is by no means outlawed – it does seem passé. 

    Chat rooms, Facebook, Online multi-player … many people's key friendships are born and kept online. 

    I remember my son, 13 years old at the time, sending 10,000+ texts a month and thinking it was a phase. I was wrong. 

    The internet has radically changed the structure of relationships – for better, or often worse. 

    Privacy ( … or the lack of it)

    One of the biggest changes is that we as individuals have become productized. We take advantage of all these free resources at the cost of being pixeled and cookied into oblivion. We've chosen convenience over safety. 

    Remember, if you’re not paying for a product – you are the product.

    Little bits of our private information, demographics, and psychographics are sold to advertisers to create smarter ads, new offers, and realistically we have very little control over that.

    It’s been proven time and time again that these giants like Google and Facebook will find ways to sneak your data to advertisers even when it’s “illegal” with a slap on the wrist.

    Data protection is a massive issue not only for corporations but for individuals. While many companies are trying to manage your privacy while still monetizing your data, there are just as many companies who couldn’t care less.

    The GPDR - while frustrating for many – is a step towards protecting individuals.

    Every action has a reaction, and every benefit has a cost. The internet is an amazing tool – but it can also be a weapon. 

     

    What will the next 30 years of the internet hold?

    "The Internet will disappear. There will be so many IP addresses, so many devices, sensors, things that you are wearing, things that you are interacting with, that you won't even sense it. It will be part of your presence all the time. Imagine you walk into a room, and the room is dynamic. And with your permission and all of that, you are interacting with the things going on in the room." — Eric Schmidt

     

    It has been 30 years since its inception, and there's still radical growth coming. 

    We’ve gone from bit speeds to megabyte speeds. We’ve gone from crappy-quality video taking hours to download to streaming HD quality video live.

    How do imagine that the internet will evolve?

    What influence do you think the Internet of Things will have?

    It’s hard to foresee how innovation and regulation will change the internet, but it’s clear there will be change.

    We live in exciting times!

  • Here Are Some Links For Your Weekly Reading – June 27th, 2021

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    Here are some of the posts that caught my eye recently. Hope you find something interesting.

    Lighter Links:

     

    Trading Links:

  • A New Experience For Me

    We had Nick Nanton and his crew in our office, recently, to film for a documentary on 'Getting to Next' – How AI is transforming the world and humanizing technology. 

     

    IMG_8468

    Nick has been involved with many cool projects from a documentary on Peter Diamandis to Operation Underground Railroad (and more). He's also won more than 20 Emmys. 

    Nick is also working on a documentary with Chris Voss – who wrote Never Split the Difference. I spent time in D.C. watching Nick shoot with Chris and his son Brandon Voss, who is the president of Black Swan Group. 

    While I've done podcasts and interviews before, this was a surprisingly fun and cool experience for me.

    It was also interesting to watch some of our more introverted data scientists in front of the camera. 

    The documentary just started shooting – but I look forward to showing you the finished product when it's ready. 

  • Inflation and Other Economic Effects: Will They Last?

    I've recently posted about the rise in global & national debt and the increasing dissonance between markets and the economy. This post is about inflation and the long-term economic effects of 2020. 

    We're currently operating on $6 trillion of stimulus. The Trump administration approved the first 4 trillion dollars, and Biden's administration added another $1.9 trillion. Around $3.5 trillion of that went to purchasing government securities. Meanwhile, the U.S. Treasury also printed another $2B in dollars (more than they produce in a normal year).

    Here is an infographic showing the programs enacted to counteract the pandemic's economic impact.

     

    2021-total-coronavirus-legislation-graphicvia PGPF (3/15/21)

    These strategies make credit easier to get by growing the money supply and lowering interest rates with banks having more reserves. Without these and the Fed's other emergency measures, the economy likely would have crashed … but was it a "fix" … or did it just delay the inevitable?

    In the short term, the stimuli did a pretty good job of creating liquidity, preventing a substantial market crash, and increasing faith in the system. 

    Markets became more erratic and harder to predict. And other ripples are starting to show in the economy. 

    Inflation: Temporary?

    It's not hard to tell that prices have risen recently. But, while consumer prices have risen 2%, on average, investors continue to invest in treasuries and push the price of 10-year yields down to where they were in February of last year. That seems to imply that despite inflation and stimulus, investors still have faith in the Fed. 

    The hope would then be that the inflation is transitory and not a long-term effect of the stimulus. 

    Screen Shot 2021-06-18 at 3.18.22 PMvia Wall Street Journal

    It's possible that this inflation is the result of a post-Covid demand surge (and not the beginning of a larger trend).  You can also assume that the surge in prices of airfares, hotels, and sports games will drop once they become "normal" again. And, even if they don't, if wages don't rise with that new demand, it's easy to picture demand returning to normal. 

    The last time the Fed created money on a similar scale (the Great Recession), high long-term inflation didn't materialize, so it might not happen again. 

    Conclusion

    I think it's unlikely that we see another 1970s style surge – and I think it's equally unlikely we see major deflation. With that said, I still don't think we've seen the end of the effects of the pandemic and the pandemic stimulus either. 

    One of the practical results of the Fed's bond purchases is that it creates money to finance the gigantic debt run up by Congress. With the national debt at almost $25 Trillion, it gets harder to pick a measuring rod of financial health that isn't woefully inefficient. The idea of "sound money" or a sustainable fiscal path seems increasingly questionable. But, if you believe in Modern Monetary Theory and in the United States' amazing ability to borrow, it's possible that there truly is no worry. Japan is a potential example of that – with a debt-to-GDP ratio of double the U.S.

    So, even if inflation continues, it's hard to judge how bad a sign it is. 

    Whether or not there's a crash tomorrow (or 7 years from now), at some point, we know there will be a "correction."

    Predicting the future is hard!

    Curious to hear what you think.