Capitalogix

America's TikTok Ban: Permanent or Temporary?

It's official: TikTok is banned in the United States ... or was? Or ... will be? It's gotten complicated. 

Earlier this week, the Supreme Court upheld the ban. As a result, at around 9:30 PM central time yesterday, TikTok voluntarily began shutting down its services in the U.S.  Here is the message it displayed when users tried to access the app. 

 

 

Over 170 million Americans reportedly use the app. As a result of the ban, TikTok also voluntarily shut off access to its other apps - Capcut, Lemon8, and more.

The U.S. government initially justified the ban because it feared the Chinese government used the app for spying and information-gathering purposes. As a result, TikTok was ordered to separate from its Chinese parent company, ByteDance. 

Then, today, after 14 hours of being offline, TikTok suddenly went live again. Had Trump saved the day? He has extended the deadline for ByteDance to make progress. And instead of asking them to sell TikTok, it seems he's looking for the U.S. to joint venture with the company, and own 50% of the app. 

Even though the app still might be banned, news outlets report that Trump plans to throw an olive branch to the Chinese government in hopes of accomplishing broader objectives. In the meantime, TikTok is back online.

I understand what prompted a ban like this. A lot of it comes down to national security interests. China is among the most aggressive nation-state actors focused on cyber warfare and industrial espionage. Their actions are increasingly overt, and I worry Americans have become too desensitized to these threats and their consequences.

We live in interesting times. Nation-state actors and private hackers are perpetrating a new form of exponential tech-enabled warfare. It threatens our infrastructure, government, private sector, intellectual property, trade secrets, and, for individuals, their personal information, tendencies, and even physical security.

I don't believe that anything I've said here is an overreaction. There are many documented cases of hacking attempts, compromise, and malicious coding. It's even more dangerous when done in the open, and we become immune to it.

Ironically, last week, as news spread that the ban was likely to be upheld, many Americans responded by downloading an app called Xiaohongshu (or Rednote). Rednote is a Chinese social media app and e-commerce platform that resembles a blend of Pinterest and TikTok. 

Many TikTok refugees have already begun using the app earnestly – and interacting more directly with their Chinese counterparts. There are jokes about being Chinese spies, Americans helping Chinese students with their English homework, pet pictures shared, inquiries into each other's cultures, and even questions about whether aspects of U.S. or Chinese propaganda are true. 

Duolingo said Thursday that the number of U.S. users trying to learn Mandarin has rocketed 216% compared to last year. Many Chinese users have also added English subtitles to their videos and created explainer videos to help Americans navigate the Mandarin-based interface better. 

While it is a surprisingly wholesome interaction, it is likely the opposite of what our government intended. It's very similar to the (Barbara) Streisand Effect, which is an unintended consequence of attempts to hide, remove, or censor information; such efforts often increase public awareness of the information instead.

But it's unlikely this Xiaohongshu spring will last. Not only are the national security fears amplified on the app, but China probably doesn't want the American youth influencing its own. Trump has also reversed his earlier position on TikTok and promised to delay and hopefully reverse the ban once he's in office. 

While Rednote may use this to bolster their value pre-IPO, it's unlikely they're willing to upset local regulators. So, you will likely see Americans siloed or kicked off the app and gently nudged back on TikTok. 

You may take this whole debacle as naivety from the American youth, but I would say the opposite—it's cynicism. They likely believe the cost of their digital existence is giving up their data to Big Tech, advertisers, and the authorities. At this point, it likely doesn't matter to them who is the one watching. They know they're being watched. 

What do you think? Will TikTok fully come back? Is it a good thing if it does?

Here Are Some Links For Your Weekly Reading - January 19th, 2025

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

Lighter Links:

• Beyond Transformers: New AI Architectures Could Revolutionize Large Language Models. (Decrypt)
• Is It a Psychopath or Sociopath? Key Distinctions Explained. (ActiveMan)
• 11 Historians Predict How Joe Biden Will Be Remembered. (Politico)
• 'A Small Act of Patriotism' – Canada's Anti-Maga Hats Go Viral. (TheGuardian)
• Whistleblower Says Government UFO Retrieval Program Exists – And That We Have Spacecraft. (NewsNation)

 

Trading Links:

• Donald Trump, Crypto Billionaire – Trump's "Memecoin" Gained Billions in Value Overnight Before Inauguration. (Axios)
• TikTok Says It is Restoring Service for U.S. Users After Trump Comments. (NBCNews)
• Yellen Says Treasury Will Use 'Extraordinary Measures' on Jan. 21 to Prevent Hitting Debt Ceiling. (TheSunChronicle)
• Who Was Better for the Stock Market? Biden or Trump? (Investors)
• The Stock Market Has Never Looked Like this Before — Regardless of Who's President.(Finance)

Carl Sagan's Foresight from 1996

Carl Sagan was an astronomer and planetary scientist whose most enduring legacy lies in his extraordinary ability to communicate complex ideas to the general public.

Shortly before his death, he participated in an oddly prescient interview about short-form media and public attention. It is worth clicking to hear his clear thoughts about how governments will use ignorance of science and technology to control people.

 

via YouTube

He goes into more detail about this topic in his book, The Demon-Haunted World: Science as a Candle in the Dark."

“I have a foreboding of an America in my children’s or grandchildren’s time—when the United States is a service and information economy; when nearly all the key manufacturing industries have slipped away to other countries; when awesome technological powers are in the hands of a very few, and no one representing the public interest can even grasp the issues; when the people have lost the ability to set their own agendas or knowledgeably question those in authority; when, clutching our crystals and nervously consulting our horoscopes, our critical faculties in decline, unable to distinguish between what feels good and what’s true, we slide, almost without noticing, back into superstition and darkness ... the dumbing down of America is most evident in the slow decay of substantive content in the enormously influential media, the 30 second sound bites (now down to 10 seconds or less), lowest common denominator programming, credulous presentations on pseudoscience and superstition, but especially a kind of celebration of ignorance."  - Carl Sagan, The Demon-Haunted World

With the national outcry at TikTok's ban being upheld in the Supreme Court, this feels even more relevant. 

With TikTok, Instagram Reels, and YouTube Shorts, even 30 seconds of attention sounds generous. Smooth-sounding AI-generated slop only makes it worse.

In many ways, we've even forgotten how to be appropriately skeptical. It's not enough to question authority and look for trusted evidence; you must also question their detractors and replacements. Laziness and ignorance rarely lead to good outcomes.

There is room in life for faith, optimism, and belief. But when you question what's being pushed toward you, how influenced are you by your existing biases and beliefs? It's hard to reason someone out of a position that they did not reason themselves into. 

Do you think America is becoming more or less ignorant? If more, what do you think it would take to reverse that trend?

Less Is More: A Powerful Neuroscience Trick

Decision-making is hard. And it's only getting harder.

Analysis paralysis is a real threat to you and your business. 

We have more data, noise, and choices than ever before. 

But there's a pretty simple trick that helped my business manage risk, my son take tests, and soon ... it can help you make smart & quick decisions. 

 

A neuroscientist, Paul Glimcher, found that instead of trying to pick the best option from your choices, start by eliminating the worst options. This approach reduces noise and makes it easier to identify your true preferences. 

My youngest son was never a great student. He was smart enough to do well – but lacked motivation. Yet, despite his lack of studying, he always managed to pass his tests. 

His "secret to success" was simply eliminating the two answers that made the least sense ... and then making an educated guess. This was enough to earn him a B-average in his classes. 

He learned something intuitively that many people struggle to figure out. 

“I choose a lazy person to do a hard job. Because a lazy person will find an easy way to do it.” – Bill Gates

If you have four options, you have a 25% chance of guessing correctly. But, if you only have two options, you have a 50% chance. When you add skill, insight, and follow-through to the equation, you can start to hack success and make it a probability instead of a possibility ... with a good enough process, maybe even an inevitability. 

 

A variation on this is that one of the key skills of data science is to figure out how to know things faster so that you guess less and profit more.

 

These ideas have been instrumental in how Capitalogix thinks about markets and business. We've built a library of systems for various market conditions and industries. I'm simplifying the process, but a large part of what creates an edge is our ability to eliminate low-expectancy options. 

This "less is more" principle helps us create clarity and reduces the lag between decisions & actions. 

Hopefully, these principles will help you as well. 

Here Are Some Links For Your Weekly Reading - January 12th, 2024

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

Lighter Links:

• Incarcerated Firefighters Play Key Role in Battling Los Angeles Wildfires. (Particle)
• Transition 2025: A Report the Incoming Trump Administration Should Read. (CFR)
• What Happened to Justin Trudeau? (RollingStone)
• How OpenAI’s Sam Altman is Thinking About AGI and Superintelligence in 2025. (Time)
• AI Could Crack Unsolvable Problems — And Humans Won't Be Able to Understand the Results. (LiveScience)

Trading Links:

• The Insurance Apocalypse – Fire, Money, and Who Gets Burned. (TheBulwark)
• US Top Court Leans Towards TikTok Ban Over Security Concerns. (BBC)
• VCs Say AI Companies Need Proprietary Data to Stand Out From the Pack. (TechCrunch)
• Wall Street Just Got Another Sign that Dealmaking is on the Rebound. (Finance)
• Dow Sees Worst Start to a Year Since 2016 as Fed Rate-Cut Hopes Fade for 2025. (MarketWatch)

How'd Markets Do In 2024

At the beginning of 2024, I asked the question - how did markets do in 2023?

It makes sense to ask the same question as we start 2025. 

Before I get started, it’s worth stating that the market is not the economy ... but with Trump about to step into office, I know people are wondering. 

I still think about the often-quoted quip “It's the economy, stupid” - coined by James Carville, a strategist in Bill Clinton’s successful 1992 U.S. presidential election against incumbent George H. W. Bush.

2022 was the worst year for the U.S. stock market since the 2008 financial crisis.

2023 was much better, but much of the gains came in concentrated sectors.  

2024 saw nearly every sector posting gains - driven primarily by AI enthusiasm and a robust U.S. economy. 

To help you get a sense of 2024 returns, VisualCapitalist put together a few helpful infographics.

 

via visualcapitalist

66% of companies on the S&P ended up in positive territory this year. The S&P also had its best two-year stretch since the late 90s. 

Communication Services usurped IT’s #1 spot, driven primarily by Meta & Google. Strong consumer spending and digital ad revenue brought ad spending to almost $400 billion. 

Materials was the only sector to see negative returns, hampered by China’s economic slowdown and increased interest rates. 

Here is a more global look at return by asset class.

 

via visualcapitalist

Driven by that end-of-year run, Bitcoin surged to all-time highs, and gold also saw its best performance in 14 years. Meanwhile, bonds suffered heavily amid reflationary concerns and a potential widening deficit under the Trump administration.

In 2024, I predicted a brief market correction, blamed on various geopolitical instabilities and partisan weaknesses, followed by a long and steady push higher as the November elections approached.

How did that prediction hold up? I'd say pretty well. 

On one level, I try not to think about or predict markets (because I know better). On another level, sometimes I can’t help myself ...

Part of me is so bullish about AI (and its impact on other things) that it’s hard to maintain objectivity. With that said, I think we’ll have another decent year. However, I expect increased volatility and noise.

What do you expect for 2025?

Do you think the continued investment into generative AI will impact these trends?

Will cryptocurrency continue to explode? What scenarios do you think have the potential to be force multipliers?

How To Achieve Your Personal Goals in 2025

A few weeks ago, I shared an article about annual planning (and how Capitalogix does it.) 

This week, I want to discuss setting and meeting goals. 

I'm a big-picture guy, and I spend a lot of my time thinking about longer-term possibilities, but it's also important to think about your strategy for the coming year. I tend to break that up by Quarters. Lower timeframes than that are more tactical, and I consider that short-term planning or scheduling.

I think of it like using a map. To find the best route, you must start by figuring out where you are and where you want to be.

 

 

Activity, alone, isn't as important as many people hope. Think of it this way ... from where you are, there are infinite potential paths – but motion in a particular direction isn't "progress" if it doesn't take you toward your desired destination.

The right action is far more valuable than merely taking action ... and that means beginning with the end in mind. You are unlikely to hit the target if you aren't aiming at it.

Resolutions only work if you actually "want" to make them happen. It's one thing to hope that something happens; it's another to commit to making it happen. 

With that said, here are some tips. 

• Focus on What You Want.
• Focus on Why You Want It.
• Focus on Ways You Might Get it.
• Focus on Evidence of Progress.

Below, I'll take you through an example of each of the four steps.

Moving Towards a Solution, Rather Than Suffering From the Problem.

Like many people, I have three distinct collections of clothes: my "fat clothes," what I'm currently wearing, and my aspirational wardrobe. This personal reality reflects how our current state often sits between where we've been and where we want to go. Before I started getting healthy, my first instinct was to think, "I need to lose weight." Knowing that "you're fat" isn't helpful … my head quickly translated that to something a tad more positive yet generic, like: "I choose to be healthy and vital and to live a healthy lifestyle."

Blah, blah … They are just words. What I needed was something specific, measurable, and actionable. How about: "I will lose 15 pounds and stop eating after dinner?" OK, but that isn't inspiring, and there isn't much for me to do. I can do better than that—and I need to—if I want to commit to the outcome.

Figure-Out a Big Enough WHY, Rather Than Worrying about the HOW's.

This post isn't about health and fitness; it is about the mindset and techniques for setting empowering goals and plans in any situation.

So, while I could list many ways to lose weight (and I might even remember to do some of them), leveraging a driving force creates momentum. In other words, the first step in "Doing" is knowing WHY you want something.

I really do want to be healthy, fit, and vital (it sure beats the alternatives), and I want to have the energy and confidence to live and enjoy my life fully. The world is my playground, and I want to take advantage of more opportunities to play with family and friends. However, to do those things, I must find better and more sustainable ways to live a healthy lifestyle.

The WHYs are just as important for business goals, too.

Focus on Potential Solutions Rather than Problems or Challenges.

Obstacles Exist. The bad news: I don't eat fish, and I don't like vegetables (unless French Fries are vegetables). My joints aren't close to healthy from years of violent contact sports. I rarely get 7 hours of sleep, and being the CEO of a startup is stressful. The good news: none of those things matter, and even if they did, it just would mean that I have a lot of room for progress.

It is natural to focus on obstacles, but most obstacles are surmountable—with a big enough WHY, I might even choose to start eating vegetables. Instead of dwelling on limitations, use them as a reminder to focus on potential solutions. They are beacons pointing the way.

How do you do it? To focus on solutions, you can make two action-based lists: one is of things To-Do ... and another is of things Not-To-Do.

Here are some of the sample To-Do Items:

• I will drink more water than coffee.
• I will stretch or do basic calisthenics on days I don't go to the gym.
• I will make a healthy shake as a meal replacement rather than a snack or mini-meal.
• I will focus on relaxation and meditation as much as I focus on strength & physical exercises.

Here is the actionable list of Not-To-Do Items.

• I will not buy bigger pants or wear stretchy pants because of an expanding waistline.
• I will not eat snacks out of their container – and will portion out what I want first.
• I will not compare my current level of fitness to what I used to be able to do. Instead, I will focus on my actions and improvement.

Create Healthier Habits.

It is easy to follow a routine. So, here's another tip ... make your routine better. Here are some examples of things you could do to make 'being healthier' happen with less effort.

• Pre-sort your vitamins into daily doses, and keep them by the coffee machine.
• Buy healthy snacks, like fruit, raw nuts, or organic energy bars (instead of chips).
• Enjoy listening to music or a book/podcast during your "exercise time." Dedicating time to something doesn't mean you can't be multitasking.
• Choose to walk the dogs or park at the end of the parking lot, so you get to walk.
• Meet with friends at the gym or a hiking spot rather than at a bar or restaurant.

You get the idea. Get in the habit of looking for ways to create better habits. What habits could you alter slightly to make a big difference? Which things can you automate or outsource?

For three books about the subject, I recommend Tiny Habits by B.J. Fogg, Willpower Doesn't Work by Benjamin Hardy, or Atomic Habits by James Clear. 

Focus on Your Progress.

In this case, it really is about the journey. Instead of tracking how far you have to go ... notice how far you've come. Utilize an internal locus of control. It is about creating energy, momentum, and a sense of possibility. You may have a big, hairy, audacious goal in mind. That's fine, as long as you realize that reaching each milestone along the way is still an accomplishment.

• Find shoes that don't hurt your feet.
• Pick a gym or a personal trainer that you enjoy.
• Run more than two laps without stopping.

It doesn't matter what they are ... they all count as long as you know you are moving in the right direction.

Summary

The point of this exercise was not really to focus on fitness. These techniques and goal-setting tools work in any situation. The principles are:

1. First, determine what you want and why it is important. Then, focus on only the few things that are truly important to you. 
2. Second, find something you can do right now that will move you in the right direction.
3. Third, notice which things create (rather than take) energy. Spend your time on those, and automate or create routines to take care of the rest.
4. Fourth, plan forward but measure backward. Set milestones so that you can recognize and celebrate your progress.

In my business, this translates to having a mission and vision – defining what we want, why it's important, and the basic strategy to achieve it. Then, we create yearly "Big 3" goals that move us toward that long-term vision. Then, the team creates SMARTs (goals that are specific, measurable, attainable, relevant, and timely) and KPIs (key performance indicators) or OKRs (Objectives and Key Results) that measure evidence of success. Doing those things lets the team know where to spend their time and whether they're on the right track.

It isn't magic, but it works.

Hope this helped.

If you're interested, here are a few more articles I've written on health and longevity. 

• Getting Healthy: Creating A New Normal
• Living Longer and Healthier
• Snake Oil Or Cure?

Onwards!

Here Are Some Links For Your Weekly Reading - January 5th, 2025

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

Lighter Links:

• How AI Works – An Entirely Non-Technical Explanation of LLMs (Every)
• Debunking Fitness Myths – The Fitness Trends That Experts Hate. (NYTimes)
• The End of Productivity – Why Creativity Is the New Currency of Success. (Every)
• Meta Deletes 2023 AI-Generated Profiles After Uproar. (Axios)
• The 7 Best Meditation Apps for Your Every Need, Whether You Want to Calm Down, Sleep Better, or Be More Mindful. (YogaJournal)

 

Trading Links:

• The One-Person Billion-Dollar Company – AI Agents Will Make That Happen. (Every)
• Creativity and Capitalism – Leveraging Both Is the Recipe for a Great Year. (KeithSawyer)
• Charted: The Pyramid of S&P 500 Returns (1874-2024). (VisualCapitalist)
• 25 Experts Predict How AI Will Change Business and Life in 2025. (FastCompany)
• How Chinese Hackers Graduated From Clumsy Corporate Thieves to Military Weapons. (WSJ)

 

The Reverse Turing: Advanced AIs Trying To Figure Out Who Is Human

The Turing Test, originally called the Imitation Game, tests a machine's ability to emulate a human. Developed in 1949, it is still a relevant test for AI. The Turing Test measures both knowledge and the ability to express it in a manner indistinguishable from a human response.

There is no agreed-upon definition for intelligence, so we can only approximate what skills we test AI on. 

While many people still believe they can tell when an AI has written something, several LLMs (like ChatGPT) have passed modern versions of the Turing Test. Many, including me, would argue LLMs still can't consistently pass the test. 

But what about the alternative? Could you convince an AI that you're not human?

Recently, a video went viral, showing a human pitting himself in VR against an AI version of Aristotle, Mozart, Leonardo da Vinci, Cleopatra, and Genghis Khan (who was played by a human).

 

via Tore Knabe

To set up the test, the human scripted the beginning and end of the dialogue and gave the AI agents a full transcript of the conversation up to that point. The entire video then played out in one recording, with no cuts.

In this "reverse" Turing test, the chatbots were scripted using various LLMs, asked questions, and then challenged to guess who the human was. Tore Knabe, the virtual reality game developer who devised the test and played the Genghis Khan role, answered one of the questions with a quote from Conan the Barbarian. 

"What a leader should do is to crush his enemies, see them driven before him, and hear the lamentations of their women."

Listening to his stuttered response, contrasted by the clunky and verbose AI responses, makes it very apparent to us, the audience, that he's human. The machines voted three-to-one that his response wasn't "nuanced or strategic" enough to represent an AI modeled on Genghis Khan's exploits. To ease your mind about hidden variables, the AIs weren't processing his voice directly. The audio was transcribed and sent to the AIs as text. 

Ultimately, this is a flawed test, and we don't really know how much of this is an actual test (versus just entertainment). In any case, it's still an interesting thought experiment. 

Do you think you could fool an AI? What if you had time to craft a response without penalty? What if your life was on the line?

For a bonus, here's a social Turing game where you can chat with someone for two minutes and try to figure out if it is a human or an AI. 

We live in interesting times!

Making The Intangible ... Tangible

I remember getting excited when my son finally seemed smart enough that I believed he was more intelligent than our dog. For the record, it took longer than I thought it would.

Likewise, human and chimpanzee infants start out remarkably similar in their early development. But here's where it gets interesting - their developmental paths take dramatically different turns once human babies begin acquiring language. This cognitive fork in the road fundamentally shapes their future capabilities.

Language is a big domino. It allows "chunking" and makes learning new things more efficient, effective, and certain.

Language is powerful in and of itself. Using language consciously is a multiplier.

Today, I want to focus on one such use of language – the power of naming things. 

The Power Of Naming Things

“I read in a book once that a rose by any other name would smell as sweet, but I've never been able to believe it. I don't believe a rose WOULD be as nice if it was called a thistle or a skunk cabbage.” - L.M. Montgomery, Anne of Green Gables

Before I go into detail, I shot a video on the subject, with a few examples from our business. 

via Capitalogix's YouTube Channel

Having a shared language allows you to communicate, coordinate, and collaborate more efficiently. But it's hard to have a shared language when you're discussing something intangible. 

That's where naming comes in. When you name something, you make the "invisible" visible (for you, your team, and anyone else who might care). 

I've often said the first step is to bring order to chaos. Then, wisdom comes from finer distinctions. Naming is a great way to create a natural taxonomy that helps people understand where they are – and where they are going.

I like thinking of it in comparison to value ladders in marketing. 

Each stage of the value ladder is meant to bring you to the next level. By the time someone gets to the top of the value ladder, they're your ideal customer. In other words, you create a natural pathway for a stranger (meaning someone who doesn't know you well) to follow, to gain value, trust, and momentum onwards ... ultimately, ascending to become someone who believes in, and supports, what you offer and who you are. 

Ultimately, successful collaboration relies on a common language. That is part of the reason naming is so important. The act of naming something makes it real, defines its boundaries and potentialities, and is often the first step toward understanding, adoption, and support. 

Creating "Amplified Intelligence"

There are always answers. We just have to be smart enough. - John Green

Here is an example from our business. When we first started building trading systems, all we had was an idea. Then, we figured out an equation (and more of them). Next, we figured out some methods or techniques ... which became recipes for success. As we progressed, we figured out a growing collection of useful and reliable ways to test, validate, automate, and execute the things we wanted to do (or to filter ... or prevent the things we wanted to avoid or ignore).

It probably seemed chaotic to someone who didn't understand the organizing principles. Fear, uncertainty, and doubt, which inhibit potential customers and stakeholders (such as a business's employees), compound the problem.

Coming up with the right organizing principle (and name) makes it easier to understand, accept, and adopt. For example, many traders and trading firms want to amplify intelligence – meaning they want to make better decisions, take smarter actions, and ultimately perform better (which might mean making and keeping more money). To help firms amplify intelligence, we created the Capitalogix Insight Engine (which is a platform of equations, algorithms, methods, testing tools, automations, and execution capabilities). Within that platform, we have functional components (or modules) that focus on ideas like portfolio construction, sensible diversification, alpha generation, risk management, and allocation strategies. Some of those words may not mean much to you if you're not a trader, but if you are, it creates an order that makes sense and a path from the beginning to the end of the process.

It makes sense. It explains where we are – while informing them about what might come later.

The point is that naming things creates order, structure, and a contextual map of understanding.

It is a compass heading used to navigate and guide in uncertain territory.

On the other hand, beware of the consequences of becoming overly connected to labels. 

Hope that helps.