In 2016, I received this e-mail from my oldest son.
Date: Saturday, October 22, 2016 at 7:09 PM To: Howard Getson Subject: FYI: Security Stuff
FYI – I just got an alert that my email address and my Gmail password were available to be purchased online.
I only use that password for my email, and I have 2-factor enabled, so I'm fine. Though this is further proof that just about everything is hacked and available online.
If you don't have two-factor enabled on your accounts, you really need to do it.
Since then, security has only become a bigger issue. I wrote about the Equifax event, but there are countless examples of similar events (and yes, I mean countless).
When people think of hacking, they often think of a Distributed Denial Of Service (DDOS) attack or the media representation of people breaking into your system in a heist.
In reality, the greatest weakness is people; it's you … the user. It's the user that turns off automatic patch updating. It's the user that uses thumb drives. It's the user that reuses the same passwords.
Whether it's malicious or unintentional, humans are often the biggest security weakness.
As proof, watch the first few minutes of the video below to watch a social engineer find out this man's email and gain access to his cell phone account. She locks him out of his account at the same time.
I started the video with the interesting part, so you don't have to search for it.
As for passwords … I recommend not knowing them. You can't disclose what you don't know. Consequently, I recommend a password manager like LastPass or 1Password.
Some other basic tips include:
Keep all of your software up to date (to avoid extra vulnerabilities)
Don't use public wifi if you can help it (and use a VPN if you can't)
Have a firewall on your computer and a back-up of all your important data
Never share your personal information on an e-mail or a call that you did not initiate – if they legitimately need your information, you can call them back
Don't trust strangers on the internet (no, a Nigerian Prince does not want to send you money)
How many cybersecurity measures you take comes down to two simple questions … First, how much pain and hassle are you willing to deal with to protect your data? And, second, how much pain is a hacker willing to go through to get to your data?
It doesn't make sense to put all your data in a lockbox computer that never connects to a network … nevertheless, it might be worth it to go to that extreme for pieces of your data.
Think about what the data is worth to you, or someone else, and protect it accordingly.
We've talked a lot about hyperbole in the news recently – and, unfortunately, it isn't limited to politics.
People seek things that engage and entertain. Consequently, other people's business is to provide things that engage and entertain … even if those things aren't necessarily accurate or truthful.
For example, I've seen many "silly" artificial intelligence and cybersecurity references on tv shows or the news. These are obviously "hot topics." But, shocking simplifications are used because most people aren't technical enough to understand real examples.
In AI, it's pretty easy to notice because you'll see killer robots or humans losing their jobs and being left with nothing to do.
Cybersecurity is tough for "normies" to get as well. For a laugh, check out this clip from NCIS.
On top of the gibberish, and the unrealistic imagery on what a hacking attempt would look like, do you think two people typing on the same keyboard would be effective? And, reminiscent of a "peek-a-boo" game you play with babies, unplugging the monitor won't stop a hacker (it will only hide the screen from you).
Earlier in the Pandemic – in June – I had a Zoom meeting with Matthew Piepenburg of Signals Matter. Even though it was a private discussion, there was so much value in our discussion we decided to share parts of it here.
While Matt's understanding of markets is based on Macro/Value investing, we use advanced AI and quantitative methods for our approach.
As you might expect, there are a lot of differences in how we view the world, decision making, and the current market environment. Nonetheless, we share a lot of common beliefs as well.
Our talk explores a number of interesting areas and concepts. I encourage you to watch it below.
To summarize a couple of the key points, markets are not the economy, and normal market dynamics have been out the window for a long time. In addition, part of why you're seeing increased volatility and noise is that there are so many interventions and artificial inputs to our market system.
While Matt and I may approach the world with very different lenses, we both believe in "timeless wisdom".
Ask yourself, What was true yesterday, today, and will stay true tomorrow?
That is part of the reason we focus on emerging technologies and constant innovation … they remain relevant.
Something we can both agree on is that if you don't know what your edge is … you don't have one.
Hope you enjoyed the video.
Let me know what other topics you'd like to hear more about.
Tuesday is election night – so there's a lot of fear and uncertainty from both sides about the consequences.
So how do you track and understand that fear? With the CBOE's VIX.
The VIX is an index that's commonly known as the "fear gauge." It tracks how quickly asset prices move (or, in other words, their "volatility").
While you can't invest in it directly, you can invest in derivative products like VIX futures, ETFs, inverse ETFs, and more.
The infographic below is a good primer, and you can download RCM's full white-paper here.
Covid cases are building, the Senate didn't pass another support bill and is now adjourned until November 9th, and you have pre-election market jitters. As a result, the VIX trading volume is hitting new highs.
Overall, a higher risk environment than normal.
For context, the VIX has averaged 26.30 since August but got as high as 82.69 in March.
In the past week, after a pretty bad S&P 500 sell-off, it's gone back above 38.
There are many ways to study and use the VIX, but ultimately, tracking it in any form helps you understand the current state of fear in market participants.
I'd love to hear how you use the VIX or other tools to measure or forecast market stress and volatility.
Early voting has started, but, if all goes to plan, we'll know who will be the President on November 3rd.
The fears of fake news and the growing echo chambers around candidates (and policies) mean it can be tough to truly make an educated decision. The reality is, most of our news sources are tinted by the lens of their ideology – which is okay. That means they're appealing to their targeted audience.
That being said, it may also be worth looking at the same news story from a comparative news source from the other spectrum – or even better, a primary source when it comes to science/economics.
Here's a chart that shows where news sources rank. You can click the image to go to an interactive version with more details. And, if you're curious about their methods, click here.
RealClearPolitics – Aggregates news from various sources, as well as writing their own opinion pieces. Also has a good visual on the current state of the presidential, senate, and house races.
Brittanica ProCon – Tracks the stated positions of politicians on various issues. Can be sorted by candidate, and by issue. It also has a quiz you can take to assess which candidate you actually resonate with.
Politifact & FactCheck – Both sites fact check presidential statements, party statements, and more. We know politicians often lie by omission, or focus only on the specific stats that are relevant to their point. Fact-checking helps you gain a more holistic picture.
As a last warning on believing anything you hear, most polls I've seen put Biden in the lead … but if you remember 2016, you know the polls are working on incomplete information. Clinton had a lead on most polls and lost to President Trump.
