Weekend Reading #149

Photo by ASTERISK KWON on Unsplash

This is the hundred-and-forty-ninth weekly edition of our newsletter, Weekend Reading, sent out on Saturday 18th December 2021.

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What we're doing.

Well for a starter what we are not doing is writing a blogpost this week. Our brains are actually just too fried, and we are going to be resting a lot over the next few weeks. Simple as that. It has been a helluva year all round and to be honest we are all absolutely exhausted. We look forward to some quiet time with our families and friends. We have set our plans for next year across all our businesses but now is time to relax a bit. We take the opportunity to thank you all for your engagement and opinions but most importantly for your support. We love what we do day in and day out and having this newsletter as an outlet for ourselves is incredibly valuable to us. We wish you a relaxing and fulfilling festive season. We will be taking a couple weeks hiatus from the newsletter and will be back with a bang on Saturday 8th January 2022.

What we're thinking.

In all seriousness, the markets have been volatile. We have written extensively about the drivers and there isn't too much new to add as this week saw more of the same to be honest. Dispersion is the name of the game for now. One new thought, though, relates to the biotech names. As we have written before, we have slowly been learning about some of these incredible minds innovating around code of the human body rather than the machine (sometimes using both!). There are lots of these stocks of course and our job is to cut through the crowd and find one or two that can be era-defining. A thought that occurred to us is that unlike the long-duration tech companies that have collapsed here, some of these biotech names have incredible embedded IP in the form of the years of research that has been done and the stock prices have been equally decimated. Risk/reward for the best biotech names is better than we can find almost anywhere now. And no one has been long of these stocks or crowding into them for years and years. It’s still quite early and underexplored, maybe exactly because at first glance, it’s all quite hard to understand.

What we're reading.

This was a great piece I came across by Riz Virk entitled “Schrodingers Bat? How the ‘multiverse’ is transforming superhero films”. Virk is an author, investor and founder of Play Labs @MIT. His books about simulation involve a lot of fun but also some deep science. This piece talks about how DC in particular with the new Spiderman movie actually uses some genuine science to bring the ‘multiverse’ (no not metaverse) mainstream.

I’ve linked many times to things written by and recommended by our friend, Jawad Mian, of Stray Reflections, but this was just too irresistible not to share. As we saw this week, Elon Musk was crowned Time Magazine’s man of the year for 2021. In 2017 Jawad wrote a note to his community about Tesla saying the following:

Jawad’s capturing of the zeitgeist was just so succinct all the way back then that it blows the mind. He understood already then what Tesla symbolised - both the positives and the negatives. Big hat tip to him. You can check out more of his stuff here.

On the topic of Tesla I also read a transcript of Josh Wolfe’s interview in Vice in which he speaks about the “To-the-moon crash” which he says is coming. What isn't written about is that the crash has already been underway for months in most long duration tech names. Only Tesla and a handful of megacap tech names have resisted this so far (though the past week has been tough too on these names). Even the fact that Tesla is considered a tech name is part of the success of how Elon has built his brand. Wolfe has been outspoken for some time about the evangelical nature of Musk’s Tesla mission, and this is a great interview for the cynical mind. In our view, there is a time and place for all views in the market. Cathy Wood had her time and at some point, his will be right for Tesla, maybe soon, maybe not. For the others it’s happening already.

And finally, another newsletter that regularly pops into our inbox is called Snippet by Yuri Khodjamirian. It’s a bit of a mish-mash of lots of cool things and this week’s post called 52 Snippets from 2021 is worth a look. Each is a one liner and will make sure sound clever to all your friends and family over the festive season! My personal favourite was no 5:

 “Often, the screams we hear in movies and TV are created by doubles and voice actors. One stock scream is so well-used it’s got a name, the Wilhelm. It’s in hundreds of films.“ [NYT]

Over the past few weeks, I’m sure lots of market participants have been heavily utilising the Wilhelm! DC

A random quote I read somewhere in the maelstrom of my Twitter feed was from the always-excellent James Clear on the power of revision and doing things right. Clear says:

The difference between good and great is often an extra round of revision. The person who looks things over a second time will appear smarter or more talented, but actually is just polishing things a bit more. Take the time to get it right. Revise it one extra time.

On a typical day scrolling Twitter, I ghost over a tonne of these sort of Tweets each day. But this one, for some reason, hit home, especially with the work I’m currently focusing on. Maybe it’s something to do with the time of year, with everyone rushing to get stuff done so that they can logoff for a well-earned break? Maybe the middle of December is the time when the last look at the final draft gets overlooked and the SEND button gets hit a little too easily. It’s the plan to take a break, but not before a final few round of revisions of what I’ve been working on. EJP

This was another nice listicle piece from another one of the best productivity gurus, Ryan Holiday, titled 32 Things I Love to Read, Listen to, Eat, and Carry With Me. It’s quite a random premise, and you’ll likely have to be a fan of Holiday to buy into the fact that he’s recommending you go out and purchase caffeine substitutes or index cards, but Holiday is a guy whose words of wisdom I like to lean on a little, whether it be his writing advice, his business intuition, or just his book recommendations. A neat list from a neat thinker. EJP

What we're watching.

The new Spider-Man movie has dropped this week and we’re keen to see it as quickly as we can to avoid having it ruined by any spoilers getting out. With a big blockbuster like this, you have to go to see it on the big screen and so we’re off to London’s Leicester Square for a viewing in Cineworld’s aptly named ‘super screen’. Whilst I’ve tried to avoid looking at reviews in fear of them revealing the plot, many critics have given it a great response and so I think I’m in for a treat. HS

On a quiet evening this week when my wife was out and my daughter was happily sleeping, I watched the 2010 classic, Matt-Damon-narrated documentary, Inside Job. Whilst sometimes dry and somewhat depressing, being about the 2008 financial crisis an' all, it is a superbly made documentary and, quite rightly, won the Academy Award for Best Documentary Feature in 2010. As said, the content’s not the most exciting, doing a fair amount of analyst-level explanation on the riveting subjects of CDSs and CDOs, but the drama that builds and the gripping nature of the story told is based on the quality of the talking heads that the director, Charles Ferguson, got access to, ranging from George Soros to Christine Lagarde, Nouriel Roubini to Eliot Spitzer. This really is the inside track on the financial crisis, a story told by the people who were there, on the inside, when the housing market came tumbling down. Fascinating and terrifying in equal measure, and well worth a watch this holly, jolly Xmas! EJP
 
In the run in to Christmas, I came across a new series released on the Disney channel called Dopesick. The series takes viewers to the epicentre of America's struggle with opioid addiction, from the boardrooms of Purdue Pharma, to a distressed Virginia mining community and to the hallways of the DEA. This eight-part drama unpicks the immorality and greed that led to the rise of “miracle painkiller” OxyContin – but is it trying to tackle too much? DK

We were told by some hardcore sci-fi watchers that The Expanse on Amazon Prime was one of the best sci-fi series ever made, so in the face of such a tall claim, it was imperative to check out. Two seasons in, the tendency is towards agreeing with that assertion. Key features: mildly dystopian future, interplanetary conflict, politics, conspiracies and (the best part) ALIEN LIFE. To be fair, two seasons out of 6 available means there remains 200% of the enjoyment consumed so far to look forward to. Amazon seems to really be picking up the pace with the quality of content they produce, perhaps as a function of having the budget to spend on character and plot development. It might eventually be worth buying the books (also from Amazon – cross selling opportunities there) to compare how the series lines up with the original, but when you’re left unsure about how the plot plays out thanks to an unending number of plot twists, that’s always a good sign. EL

What we're listening to.

We’ve been banging on about Succession, the TV series, in this newsletter for far too many weeks in a row now, but one neat little sidestep that you can make if you’re still keen to get your fix of the Waystar Royco way is to plug into the soundtrack. Yes, the theme tune is great, but I much prefer the melodic, haunting piano-led melodies that are thee shbackdrop throughout. This week I’ve been plugging the sound of Succession into my ears whilst I churn through some work. This is a great Spotify playlist of the hit show’s sounds and is the perfect accompaniment to your attempts to try to take over the world like Logan Roy and his band of merry miserable men and women. Kendall’s “L to the OG” ultra-cringe but actually awesome rap from a party honouring his father, Logan’s, fifty years in business is also a personal highlight and office favourite. EJP

As always, the Uncommon core podcast with Su Zhu and Hasu was superb. This one is particularly timely as it featured Su giving his views on alternative layer one blockchains versus Ethereum. Su had wrought much controversy recently with his assertion (in rather blunt terms) that Ethereum was doomed as a transactional blockchain (but not as money). For anyone looking to understand the pros and cons of different layer ones I highly recommend this. It made me think a lot and challenge my own base case and this is only ever good. DC