Weekend Reading #150
This is the hundred-and-fiftieth weekly edition of our newsletter, Weekend Reading, sent out on Saturday 8th January 2022.
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What we're thinking.
One of the perils of being in the business of managing money is that you’re always expected to have a crystal ball which reveals in minute detail where the market is going to go, as if markets were a game with a walkthrough guide that, if discovered, leads to untold riches.
Unfortunately, as we have learnt through our many years in this business, that is hardly the case. There are times when we benefit from great clarity of vision and are able to make good trades, and there are other times when the only thing that is clear is a screaming lack of clarity. In the case of the former, it is a time to make money, whether long or short; In the case of the latter, it is a time to NOT lose money. And the latter is where we find ourselves in markets right now.
Santa Claus Rally? Didn’t really happen. Seasonal inflows of more than 100% of annual inflows happening in January? Could be happening, maybe not yet; maybe soon? Are we in a scenario where “bad news = good news” or “bad news = bad news”?
Nothing in the rulebook says that one needs to take a swing at every ball that comes one’s way. It’s only the first week of the year – there are 51 more, and 51 weeks is a VERY long time when it comes to markets.
What we're reading.
After a COVID-filled festive season, I read quite a bit, the highlight of which was a Daniel Silva spy thriller featuring his fantastic Mossad super spy, Gabriel Allon. This title was called “The Order”. It took me a day and a half, and I enjoyed the insights into the Catholic Church and the Vatican. The story begins with the death of a pope and accelerates rapidly from there. I love Daniel Silva books because apart from the fast-paced story there is a healthy smattering of history and usually art history too.
Two crypto OG’s are Arthur Hayes and Jordan Fish (AKA @Cobie). A trend amongst successful crypto traders is to write longform blogposts in which they philosophise about everything under the sun. Cobie recently was a bit bored it seems and wrote a series of blogposts including this one, in which he talks about the “metagame”. We call it the narrative game but it’s all the same and his blogpost beautifully pieces it all together in covering how to think about trading in and out of themes and ideas.
This week Arthur Hayes wrote his latest piece which covers the only thing that matters and that everyone in the world is focusing on right now – The Fed and inflation. In this musing, he articulates his view on what the implications are for crypto assets in his usual wordy way. DC
The Christmas break was a great chance to finish off books that we had been sitting on for too long in 2021 and start the mountain of new books that we were so generously gifted under the Christmas tree. Here’s two I finished and highly recommend. The Dealmaker is the business biography of Guy Hands, CEO of Terra Firma, and a man who has built a vast fortune in private equity. Hands’ career, whilst looking on the surface, given his billions, like a knockout success, is filled with trials and tribulations, including his lifelong battle with dyslexia and a business career that contains more ups and downs that than the Bognor Big Dipper. As a consequence, the lessons and wisdom he passes on in the pages of this fast-paced business book are worth their weight in gold to anyone seeking to forge a career in financial services. In a similar vein, and another non-fiction focused on financial services, is Lionel Barbers’ diary, The Powerful and the Damned, which tells the story of his career as editor of the FT from 2005 to 2020, 15 years that were packed full of turbulence and world-changing events. Viewing the action from behind the editor’s desk at the FT, Barber had a front-row seat, working with journalists who wrote up the action whilst meeting and greeting all the key global players who shaped the world as we know it today. Both these books contain a combination of modern history and teachings for anyone who wants to lean on the success and expertise of others. Hence, they’re both fine books to read in January as you look to shape the year ahead. EJP
Our Man in Havana by Graham Greene has been a great read to pass the time whilst away. From the start, you immediately are immersed into sunny Cuba through Greene’s vivid descriptions of both the tropical location and the book’s colourful cast of characters. I am not fully finished with it yet, but what I’ve read so far has been good and I’ll continue to read it as I embark on my travels (writing live from the airport departure gate). HS
What we're watching.
I watched more shows while stuck isolating over Christmas than I did in the entire past year. Firstly, a show which I had been meaning to get back to for ages is The Young Pope, starring Jude Law and created and directed by Paolo Sorrentino. It is DARK. Jude Law plays a young pope who likes to do things his way. The show has literally everything especially all the sordid goings-on in an imagined Vatican. Problem is you can easily see how it's all incredibly real. The second season is called The New Pope and introduces one of my favourite actors of all time, John Malkovich. It's just twisted and brilliant.
Next up was Afterlife, the Ricky Gervais creation. The thing about this series is that with Ricky Gervais, one expects on-the-floor laughter. And even though there are a few moments like this the series is actually very poignant. In season 2, he is still recovering from the loss of his wife and his entire outlook and behaviour stems from this vulnerability. It’s a beautiful show to watch but make sure you are ready for some surprisingly emotional moments.
Finally, I watched a humdinger of a sci-fi series called The Silent Sea. It is a Korean series featuring a team that is sent to the moon to recover some samples from a pre-existing lunar base. They are not told what the samples are but as you can imagine, things get seriously weird. Its excellently put together and really fascinating to watch a space-themed show that doesn’t have the usual American dominated narrative. I really enjoyed it and recommend it if you don’t mind subtitles. DC
The second season of The Witcher landed on Netflix over the holidays and all the new episodes were promptly watched. Opinions seem to be split around this, with some disagreement with the view that it was a well-made piece of storytelling. Perhaps watching the TV series is more enjoyable for those who haven’t read the original books or played the games, since a quick look through fan-produced wiki articles about some parts of the storyline after the last episode suggests that the Netflix production has been relatively faithful to the canonical storyline so far. Game wiki, therefore, equates to spoilers. Bottom line, if you haven’t played/read the original lore, don’t – enjoy the effort that Netflix has put into delivering this season.
This paragraph probably belongs in another section, but context trumps order. Non-spoiler leak: Jaskier the Bard, played by Joey Batey, is back. And as a Bard, he has some fantastic tunes. This one, entitled “Burn, Butcher, Burn” which you will undoubtedly see in the course of going through the series, is worth enjoying even as a standalone listen. That man can really sing (yes, a Google search of “Did Joey Batey really sing in the Witcher?” confirms that the voice was indeed his) – outside of his Witcher work, his duo “The Amazing Devil” makes for interesting listening. Not everyone’s cup of tea, probably.
While on the topic of Netflix series, the final instalment of Money Heist episodes also landed. Unfortunately, despite wanting to say the best things about El Professor and his infinite ingenuity, Money Heist feels like one of those franchises that stuck around for a couple of seasons too many. Without spoiling it for anyone who intends to watch it – it did end with an interesting twist, but one could almost say that the interesting twist was mandatory for a series like Money Heist. Does that make it less of a surprise? Probably. And fortunately, it looks like they’ve decided to not run any extensions of the series – which would probably be for the best. EL
Last week I came across an article that read, “The Best Films on Netflix 2021”. That prompted me into watching 3 of the top 10. “The Harder They Fall”; “Oxygen” and “The Guilty”. Idris Elba stars in The Harder they Fall and doesn’t disappoint. Gunning for revenge, outlaw Nat Love saddles up with his gang to take down enemy Rufus Buck, a ruthless crime boss who just got sprung from prison. Then, Inglorious Basterds star Mélanie Laurent takes the lead role in Oxygen, where a woman wakes in a cryogenic chamber with no recollection of how she got there. As she's running out of oxygen, she must rebuild her memory to find a way out of her nightmare. A claustrophobic survival movie that will grip you from start to finish. Lastly one of my favourite actors Jake Gyllenhaal stars in The Guilty, where a troubled police detective assigned to 911 operator duty scrambles to save a distressed caller during a harrowing day of revelations — and reckonings. All three movies gave me my fix for SciFi, Drama, Western, Thriller... what more can you want for 2022? DK
What we're listening to.
This interview with Lex Fridman and Elon Musk is a must-listen. Whatever one may think of Tesla, one cannot deny the impact Elon has had on a generation of super-smart and ambitious people. Lex has received many plaudits for this interview (his third with Elon), particularly his use of the pause, in which he lets the silence play out before Elon answers a particular question here. Fast becoming my favourite podcast, this is just one of many excellent interviews. DC
If you’re looking to make some NY resolutions (and stick to them), a fine listen to kick off the year came from Tim Ferriss with Rich Roll, podcast host and ultra endurance athlete. Roll’s story is a really inspiring one. At age 40, he made the decision to overhaul the sedentary throes of overweight middle age. Walking away from a career in law, he reinvented himself as a globally recognized ultra-distance endurance athlete, bestselling author, and host of the wildly popular Rich Roll Podcast, one of the world’s most listened to podcasts, with more than 200 million downloads. In this excellent listen, he shares with Tim many of the habits and tricks which allowed him to get there. Give a listen. Be inspired. Hold yourself to those resolutions! EJP
One of the projects that we find most fascinating in the world of crypto is Helium. Yes, it’s the one with the little hotspots all around the world transmitting low-powered WAN for IoT devices and more recently 5G coverage. When we first wrote about Helium, there were around 18k hotspots in the network – just over half a year later, that number is north of 400k. Owning a Helium miner (of any sort) is almost a specimen of OG swag – it just meant you knew about it early enough and placed an order for it a really long time ago. This latest podcast with Frank Mong, the COO of Helium Inc, is a must-listen, as he tackles questions not only about growth and prospects, but also about the ethos and beliefs of the company Helium Inc., an entity that is completely separated from the community that owns the Helium Blockchain and its HNT tokens. It remains one of the best masterclasses in decentralisation and the application of blockchains to achieve what was previously impossible – listen and the reasons will become clear very quickly. EL