Weekend Reading #329

This is the three-hundredth-and-twenty-ninth weekly edition of our newsletter, Weekend Reading, sent out on Saturday 23rd August 2025.

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What we're thinking.

Jackson Hole and Chair Powell's speech re-ignited the bull case. The question now is all about rotation. With the Fed effectively abandoning the 2% inflation target seemingly out of nowhere, dollar weakness, commodities and all cyclicals come into play in a serious way. But to be honest with this kind of nitroglycerin thrown onto the market one doesn’t need to get clever about what is going on. The answer is everything. The rotation discussion is about which goes up more.

Ethereum smashed towards new highs, quite possibly the strongest price action of any instrument across our wide array of asset prices we watch. This is its time.

What we're reading.
If it hasn’t already come across in our writing recently, it’s clear we are not exactly bullish on the UK as a place to build a future. Here is a Substack article I stumbled across which goes into great detail explaining the many issues facing the country today. Sadly it doesn’t paint a pretty picture. This is not the place it was all those years ago when we arrived and many of those who can are leaving. This is compulsory reading for anyone in the UK or who wants to understand more.

Ted Gioia is a prolific writer and he hits the nail on the head with this article about how our shared reality will self-destruct within 12 months. He is of course referring to AI and how we already cannot tell the difference between what is real and what isn’t but over the next 12 months we will all notice it and have an existential moment. This is something Ben Hunt has written about ad nauseum for Epsilon Theory and is probably the most important issue of our time. What is truth? No one already knows. Sadly, it can get much worse.

This is a really poignant article written by acclaimed Turkish novelist, Kaya Genc. It covers the state of the country as evidenced by the filmography of film-maker, Nuri Bilge Ceylan. This essay illustrates the evolution of the country through his films over the past 20 years or so. I’ve never seen any of these films but now have a list to get through. For all its grandstanding as a nation, Turks, much like the British now per above, are no longer proud of what their nations have become. And this is what must change. Unfortunately the type of change most would hope for, doesn’t usually come about smoothly. DC

Continuing on the thread of the already-visible unintended consequences of widespread AI adoption, a new syndrome (for lack of a better word) seems to have emerged – what is informally being called “AI Psychosis”. This article in the Washington post is a great explainer, highlighting how intensive interactions with AI chatbots like ChatGPT lead some users to develop false beliefs, delusions, or paranoia. The phenomenon is new, with anecdotal reports of users losing touch with reality, sometimes after seeking therapeutic help via chatbots. It turns out there have even been cases where excessive AI use corresponded with psychotic episodes. Artificial Intelligence truly is getting good enough to pass off as human – and it’s something we’re going to have to contend with. Turns out the Wachowski twins weren’t that far off after all – in the words of Morpheus from the first Matrix film: “What is real? How do you define real?”

In other news, I’ve finally jumped onto the Conn Iggulden bandwagon, starting with “The Gates of Rome”. It follows the coming-of-age of two boys, Gaius (Caesar) and Marcus, as they are trained for battle amid Rome’s political intrigue and civil unrest. Set against the backdrop of a Rome on the brink of transformation, it’s been quite a compelling read (so far). As with all historical fiction, there has obviously been some artistic license – such as roman children being called “lads”. But all good fun and a really enjoyable read so far! I’m told that the Mongol series is even better so will have to work my way there! EL

What we're listening to.

Desert Island Discs has been a bit hit or miss of recent but this is a lovely one with famous conductor, Gustavo Dudamel. His story of Venezuelan music growing up and of course his selection of tracks is worth listening to alone. But there is much, much more. Really enjoyed this one. DC