Reminders …The Markets and Your Data Never Sleep

I am off to New York for a few weeks tomorrow (Stocktoberfest is April 25). I did a lot of reading this weekend so I thought I would let a bunch of thoughts and links fly…hope you enjoy.

As the markets bob and weave at the moment, slightly down on the year, it’s a good time to do some spring cleaning of your portfolios and your minds. Its a good time to be on the lookout for fresh ideas and trends. It’s never a bad time to make some sales calls and some friendly calls (one day it may be a sales call).

Here is what the S&P looks like to a trader right now:

Some refreshers and good reads that stood out to me….

First everything you need to know about Bitcoin refresher:

Not sure I agree with ‘never sell’ but I swear by the others.

In possibly related Bitcoin news…an actual Japanese person named ‘Satoshi’ won a PGA event this weekend.

While we are on the subject, I liked this read titled ‘The Many Faces of Bitcoin‘.

Morgan Housel had a post titled’ Some Things I Am Pretty Sure About’. The gist:

Most snake oil salesmen believe in their snake oil, because the intersection of needing a paycheck and needing to look yourself in the mirror with pride can be stronger than reason. To paraphrase Kahneman, it’s easier to recognize other people’s flaws than your own.

Things that cause permanent blindness: Luck attributed to skill; Losses that cause a lifestyle downgrade or fewer career options; Unshakeable political beliefs that influence investment decisions; Building a reputation on a single belief that you can’t distance yourself from.

The biggest social problems are opioids, student debt, media distrust, and affordable housing. These are generation-defining issues whose economic incentive to solve is dwarfed by the harm they cause.

Tell people what they want to hear and you can be wrong indefinitely without penalty. Confirmation is in much higher demand than information.

Some things that look unsustainable are new breakthroughs that don’t apply to past trends. Every new industry fits this description. Many market trends do, too. But it’s safer to call something a bubble than predict a new trend because bubbles threaten careers while cheering new ideas makes you look like an aloof salesman.

The same traits needed for outlier success are the same traits that increase the odds of failure. The line between bold and reckless is thin. So be careful blindly praising successes or criticizing failures, as they often made similar decisions with slightly different levels of luck.

Next…I love cash but is cash really ever king when it comes to investing?

My friend Charlie has the numbers.

As for Faceplant, Mark ‘Z’ slid in and out of Washington unscathed. I liked Professor Galloway’s takeaway the best in his post titled ‘Facebook 1, Congress 0‘.

We can’t turn off all the machines. My friend Brad Feld who worries about the machines for me had this great post titled ‘The Price of Free is Actually Too High‘. The ending is gold:

I think something more profound is going on here. We are getting a first taste of how difficult it is for a world in which humans and computers are intrinsically linked. Tristian’s punch line “The problem with Facebook is Facebook” hints at this. Is the problem the leadership of Facebook, the people of Facebook, the users of Facebook, the software of Facebook, the algorithms of Facebook, what people do with the data from Facebook, or something else. Just try to pull those apart and make sense of it.

I think this is a pivotal moment for humans. I’ve heard the cliche “the genie can’t be put back in the bottle” numerous times over the past few weeks. Any reader of Will and Ariel Durant know that the big transitions are hard to see when you are in them but easy to see with the benefit of decades of hindsight. This might be that moment of transition, where there is no going back to what was before.

My friend Mike Lazerow was in Vancouver for the yearly TED conference. He mentioned Israeli historian Yuval Noah Herari made two points to the TED crowd that really hit him hard:

Data now makes dictators more powerful than democracy.

And you should never underestimate the extent and scale of human stupidity

Howard here again…I want the machines and know they can’t be stopped. The machines do good as well. Read this piece on how Alexa is a revelation for the blind.

Finally – Stefan read Warren Buffet’s annual shareholder letter and had a nice review of what he learned.

I feel better now. Mission accomplished. Have a great week.

Also published on Medium.