Capitalogix

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. 

 

 

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

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

Lighter Links:

• Video: Richard Branson's Space Flight Takes Off. (Flipboard)
• Bezos and Branson are Going To Space! Or Maybe Not. (Wired)
• Kosher Lab-Grown Pork from Israel's Growing Cultured Meat Sector. (JPost)
• Death Rates are Declining For Many Common Cancers In the U.S., Report Finds. (StatNews)
• How a Lizard's Venom Inspired the Promising Weight Loss Drug Wegovy. (Vox)

 

Trading Links:

• The Meme Stock Trade is Far From Over. What Investors Need To Know. (Barrons)
• 7 Upcoming IPOs To Watch In the Second Half of 2021. (BankRate)
• For the First Time, the Fed Flags Crypto Prices as a National Financial Risk. (Fortune)
• The S&P 500 Could Drop Sharply in the 3rd Quarter as the '5 P's' Pressure Markets, Bank of America Says. (Markets)
• Shaquille O'Neal Shuts Down the Internet with His Financial Portfolio, Owns Forever 21, Elvis Presley, and Much More. (ABS)

 

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

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

Lighter Links:

• A New Study Reveals Which US City Has the Worst Traffic, and it is No Longer Los Angeles. (USAToday)
• 30 Pics Showing How Unbearable the Heat is In Part of the US and Canada Right Now.  (BoredPanda)
• The Court Decision Freeing Bill Cosby, Explained as Best We Can. (Vox)
• McDonald's is Replacing Human Drive-thru Attendants With AI. (BigThink)
• Joey Chestnut Wins 14th Nathan's Famous Fourth of July Hot Dog Eating Contest with Record 76 Franks. (USAToday)

 

 

 

Trading Links:

• Jeff Bezos Officially Retires with Twice as Much Money as the Entire British Monarchy. (Unilad)
• 130 Countries Agree to Global Minimum Corporate Tax Rate. (Axios)
• EXPLAINER: 5 Key Takeaways from the June Jobs Report. (APNews)
• Manhattan Real Estate Prices Reach New Record as Buying 'Frenzy' Takes Hold. (CNBC)
• Michael Burry, Jeremy Grantham, and Other Top Investors are Predicting an Epic Market Crash. Here are Their Gravest Warnings So Far. (Markets)

 

 

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

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

Lighter Links:

• Why is Cognitive Flexibility Important and How Can You Improve It? (WEForum)
• The Perfect Number of Hours to Work Every Day? Five. (Wired)
• Artist Sells Invisible Sculpture for Over $18K. (NYPost)
• Check Out the Rotation of the Earth from a Whole New Perspective. (Flipboard)
• CRISPR Injected into the Blood Treats a Genetic Disease for First Time. (ScienceMag)

 

 

Trading Links:

• The Global IPO Market Has Never Been Hotter Than It is Right Now. (Bloomberg)
• Banks Will Double Their Capital Return After Successful Stress Test, No. 1 Analyst Mayo Says. (CNBC)
• Hotels and Restaurants' Rebound Summer Held Back by Shortages of Everything. (Wall Street Journal)
• Feds Accelerating Crypto World Crackdown. (FoxBusiness)
• Virgin Galactic Gets Official Clearance to Start Flying Paying Customers to Space. (Gizmodo)

 

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. 

 

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.

 

via 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. 

via 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.

A Look At Trade Blocs

The Global Economy is more complex than I could ever explain in a single blog post. But one of the simplest ideas to understand is that trade and commerce are the foundation for the Global Economy. 

Trade between states, nations, and continents is how you end up with innovation, global increases in prosperity, and resistance to the consequences of famine, natural disasters, and even pandemics. 

But, the wants and power dynamics of these different entities can get complicated. There are many intergovernmental trade barriers.

That's where trade blocs come in ... Two you likely recognize would be NAFTA (now USMCA) and the EU.

Trade blocs are meant to reduce trade barriers between participating entities but are sometimes controversial for their potential consequences. For example, they can result in rival groups, overly benefit certain countries, and potentially place undue pressure on certain exports. 

In late 2020, the Regional Comprehensive Economic Partnership (RCEP) was signed and creates the largest trade bloc in history - accounting for over 30% of global GDP and population. Visual Capitalist put together an infographic about RCEP's formation and likely implications. 

 

via visualcapitalist

The agreement isn't fully ratified (it is set to be fully launched by early 2022). Regardless, it will impact the global stage and create approximately $209B of income increase per year.

Despite all the rules and benefits that RCEP will have for its 15 nations, it doesn't contain any provisions for labor unions, environmental protection, or government subsidies. 

As China continues to race against America to be the largest global superpower, the RCEP is a powerful tool in its arsenal.

Here Are Some Links For Your Weekly Reading - June 13th, 2021

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

Lighter Links:

• Blue Origin Auctions Seat on First Spaceflight with Jeff Bezos for $28 Million. (CNBC)
• This is Why There are No Mosquitoes at Disney World. (Hunker)
• There's a Stark Red-Blue Divide When It Comes to States' Vaccination Rates. (NPR)
• Vladimir Putin's Time in Power, Compared to Other World Leaders. (Barrons)
• He's Heckled Shaquille O'Neal and Kobe Bryant. Now He's the First Fan in the NBA Hall of Fame. (Vice)

 

Trading Links:

• G7 Leaders to Announce Plan to Phase Out Gasoline Cars. (Axios)
• UN Says Cost of Food at Highest Level in Over a Decade. (BBC)
• The Perfect Storm Making Everything You Need More Expensive. (CNN)
• Inflation Scare? Look At This Chart Before Freaking Out. (MarketWatch)
• Nvidia CEO: We're Moving Towards a Crypto Metaverse. (Decrypt)

Getting To Next: How Thoughts Become Things

Two weeks ago, I introduced Innovation Activity Centers which are the building blocks for my technology adoption model.

Today, I have a video and a worksheet for you that goes into the overarching Technology Adoption Model Framework. It explains how thoughts become things and how ideas scale with respect to capability, audience, and monetization.

The four base stages of this framework are: Capability –> Prototype –> Product –> Platform. 

It's a great use of 20 minutes. Check it out.

 

 

While the Technology Adoption Model Framework stages are important, the ultimate takeaway is that you don't have to predict what's coming, only how human nature works in response to the capabilities in front of them.

It's a bit cliche, but to paraphrase Wayne Gretzky, you just have to skate to where you think the puck is going to be. 

Desire fuels commerce.  As money fuels progress, desire grows ... and so does the money funding that path. As such, the path forward is relatively easy to imagine.

This isn't about predicting specific technologies, but rather about the capabilities people will want.  I think of it as anticipating the natural path.  It is easier to ride the wave than it is to fight nature.

Each stage is really about the opportunity to scale desire and adoption.

It isn't really about building the technology, rather it is about supporting the desire.

If you understand what is coming, you don't have to build it, but you can figure out where you want to build something that will benefit from it.

This model is fractal.  It works on many levels of magnification or iteration.

What first looks like a product is later seen as a prototype for something bigger.

For example, as a Product transforms into a Platform, it becomes almost like an industry of its own.  Consequently, it becomes the seed for a new set of Capabilities, Prototypes, and Products.

SpaceX's goal to get to Mars feels like their North Star right now ... but once it's achieved, it becomes the foundation for new goals.

This Framework helps you validate capabilities before sinking resources into them. 

In the video, I walk you through several examples of companies, their innovations, and how they fit into each stage. I even used Capitalogix as an example. 

I'm also attaching a fillable PDF of the form we used so that you can run through this with your business as well. 

As I continue to refine and work with this framework, I look forward to improving it and sharing it with you all. 

As the world continues to change faster and more dramatically, this framework will help you anticipate changes, and it will also help you take advantage of them. 

If you have any questions or comments about the idea, or how to implement it, feel free to reach out. 

Onwards!