Weekend Reading #119
This is the hundred-and-nineteenth weekly edition of our newsletter, Weekend Reading, sent out on Saturday 22nd May 2021.
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What we're doing.
Recovering. This has been a hectic week, particularly in the markets so hopefully this weekend we can recuperate mentally and recharge a bit.
Apart from the markets, this week England has seen the further lifting of restrictions and as such we edge closer on our eventual return to normal. Thursday evening marked the first proper indoor gathering we’d been able to go to in over a year now and we were excited. Alcohol was flowing freely, and friends reunited after what had been a tough year for many. As was to be expected, the conversation quickly turned to crypto and before long hours had passed and we were still nattering away on the topic of decentralised finance and yield farming.
Gyms and other indoor fitness centres have been able to open for over a month, and having sat at a desk at home for over a year now, there’s been a sudden urge to get into shape more and break free from the sedentary lifestyle that has become so familiar. With Summer just around the corner too, we have been trying to work out about 4-5 times a week and have seemingly gotten a good routine going in the mornings just before the school run hits and the roads get too busy. Whilst we’re also partial to a nice bike ride for a bit of cardio, none of us are close to as keen as DK who will ride whatever the weather, however as the temperatures get warmer and it brightens up in the coming weeks, we will certainly try to get out on the bikes more and spend some more time outdoors.
What we're thinking.
Black Wednesday in the world of crypto was very intense! And at time of writing this part of the newsletter (Friday afternoon) it wasn’t any prettier following yet another China ban. Crypto is notoriously volatile and these washouts do happen from time to time. We are keeping an open mind as to whether this is yet another deep pullback in the bull market or the end of the so-called cycle. The price action is vicious but either way opportunities will open up. One doesn’t need to buy lows to make money in the markets. What’s clear to us is that bull or bear market, we are entering in an environment where dispersion will be apparent. The proper projects with real fundamentals may rebound faster than anyone believes whereas many of the retail-driven meme coins may drift lower and never recover. Having (mostly) avoided the temptation to short in crypto for some time, we have sized up our favoured opportunities and await the right levels. We firmly believe a long/short approach can succeed in this arena. But as in equities, there is a time and a place to begin. DC
We’ve also been thinking about politics. Chile’s election results over the past week may be far reaching. Leftist and independent candidates surged in the polls as the country overwhelmingly voted for major change. The results are significant as the winners are tasked with writing a new constitution to replace Pinochet’s 1980 one. Markets have spoken with their order books as Chile’s main IPSA Index collapsed after the results. It remains to be seen whether some of the more populist bill proposals will be enacted as they need a two thirds majority in the assembly but either way the country is entering a new period where things will be very different to the status quo that has existed for decades. Chile’s circumstances are quite specific, but this is one of the first elections post Covid and we wonder whether it could be a sign of what’s coming elsewhere. DC
What we're reading.
Zen and the Art of Motorcycle Maintenance is something of a cult classic, one I’d been recommended for years but never got round to reading. Over the past few weeks, I’ve ticked it off and it’s a book I’d wish I’d read in my early twenties. Still, as with any great book, better late than never. The story is a simple one, of the author, Robert Pirsig, and his 11-year-old son on a motorcycling holiday in America's Northwest. Pirsig is a motorcyle enthusiast, a man who keenly takes care of the bike they share along the way. Drawing on the lessons he’s learned whilst finding his way as an amateur mechanic, studying philosophy, living his life, he digs into what it means to live well. As Pirsig says:
The difference between a good mechanic and a bad mechanic, like the difference between a good mathematician and a bad one, is precisely this ability to select the good facts from the bad ones on the basis of quality. He has to care.
And this is the key rule to draw from this book, Pirsig’s meditation: whether you’re checking the oil on a bike, building a business, having a conversation with your son, diligently select the facts to work with, seek out quality, and do it with care. If you do, whatever it is, you’ll do it well. EJP
We all know about the fame and success leading influencers have achieved through social media and many of us are a little uneasy about kids growing up and wanting to be Youtube celebrities. In this digital metaverse we are already living in there always lingers the miasma of what lies beneath the façade of perfectly pitched Instagram videos and Tik Tok tales. In this blogpost from Ali Montag, she explores the darker side of notoriety - the lure of fame and the high that it brings, only to dissipate helplessly once the audience moves on. A must read for parents (and kids who old enough to understand). DC
Despite what many may think of Arthur Hayes (he is currently awaiting trial for contravening the US’s Bank Secrecy Act), the man is a genius. Apart from building Bitmex from thin air in a time when crypto was even more the Wild West than it is today, he writes the most wonderful and razor sharp blogposts around. In this blogpost, “Fear is the mindkiller” he elucidates so much covering Bitcoin, Ether, Dogecoin, Sir Thomas Gresham, money, technology and much more. If you read one thing this week, this is it. And he opens with both a reference to Liu Cixin and Daniel Kahneman, the two biggest inspirations which shaped our thinking and upon which we built this business. If you want to learn more about him then this Vanity Fair piece is a great profile too. DC
What we're watching.
Remarkably this week I found myself watching the English Football League Championship (or in English the league below the Premier League) playoff between the mighty Barnsley and Swansea. It was on in the background but I quickly became enraptured. It was sensational. Why? Because there were fans! It was the first match I’d seen with fans back. Despite only being a far smaller contingent, the noise was just unbelievable. Football (and most sport) has been a bit boring since COVID because the fans are everything. The players battle harder and it seems to mean more. Here’s hoping it gets back up and running fully. DC
I’ve never been one to watch animated shows but to be honest I stumbled upon Invincible on Amazon Video and I couldn’t stop. Its about superheroes, protecting and taking over the world but it’s the way its done that is so captivating. I don’t even want to give a plot summary as its just so wild you have to watch it for yourself. Last year I watched The Boys on Amazon too which was exceptional. This was a similar theme - superheroes are not always nice. DC
The political and philosophical struggles amongst the conspirators leading to the assassination of Julius Cesar feel topical these days. The question of what good people should do about the threat of tyranny, questions of what constitutes virtue and the role it plays in life (something that Cassius as an Epicurean and Cicero as a Stoic/Peripatetic disagreed upon) is as important now as it was then. The 1953 MGM version of Shakespeare's Julius Cesar has an amazing cast with James Mason a great Brutus and the young Marlon Brando mesmerising as Mark Antony. LM
What we're listening to.
After 500 podcast episodes, there has been a tendency, to my mind, to think that perhaps the Tim Ferriss Show is running out of steam and pulling on a thread that should've been cut loose a little time ago. But then, as all great content creators do, Tim delivers up an episode of such quality that it makes you so glad that he hasn’t quit yet. I only listen to, perhaps, one in ten of Tim's episodes nowadays whereas my uptake used to be closer to 70% or 80%. I'm not quite sure why that is – Maybe I've changed? Maybe the quality of the guests has dropped a little? – but, true to his form, Ferriss still delivers what he advertises on the tin ("deconstructing world-class performers") and the recent episode that he recorded with war journalist and writer, Sebastien Junger, was a terrific episode that taught me much and challenged me also. I urge you to listen, especially if you have an interest in writing or are a (reasonably) new parent. Junger's book, Tribe, which we've recommended in this newsletter before is well worth a read as I'm sure will be his new release, Freedom. EJP
After an annoying morning earlier this week I went for a long walk through the woods in Shenley. Instead of my usual dose of financial market podcasts, I decided to listen to Simon Sinek’s one called A Little Bit of Optimism. His seminal Ted Talk on how great leaders inspire action remains one of the most viewed of all time. But in this podcast epsiode he has a little chat with comedian, Michael McIntyre. It’s a short one and they just chat about lockdown and life in general and really made me laugh to myself and did the job. DC