Multi-Disciplinary Reading - Book Reviews

Fooled by randomness definitely first, followed by ‘The black swan’, then ‘Antifragile’ and ‘Skin in the game’ which is pretty much the chronological sequence in which they were written. Highly recommend ‘The bed of procrustes’ as well which can be read anytime. I have not read ‘Dynamic hedging’ and ‘Statistical consequences of fat-tails’ yet to comment on them.

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THE POWER OF GEOGRAPHY: Ten Maps That Reveal the Future of Our World

by Tim Marshall, 2021

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This book is a masterpiece on geopolitics. The central idea of this book is that the world is entering a new age of great-power rivalry in which numerous actors, even minor players, are increasingly playing an important role.

The big eye-opener for me was the complex politics that’s playing out in the middle east: Turkey has an acrimonious relationship with pretty much all countries in the region plus they have a love-hate relationship with Russia; Iran is actively working on building a corridor of influence all the way westward to Egypt; with decreasing importance of oil Saudi Arabia is trying to make a major pivot – they have befriended Israel to buy iron dome technology and they are investing heavily in technology. Middle East’s politics is complex where your enemy’s enemy might be your enemy as well.

Below are my notes –

AUSTRALIA

*Australia’s size and location are both a strength and weakness. They protect it from invasion but also held back its political development.

*As a continent it experiences extreme diversity in its climate and topography, from deserts to tropical forests to snow-capped mountains. But the majority of it is taken up by what is known as the Outback, covering about 70 per cent of Australia, much of it uninhabitable.

*Almost 50 per cent of the people live in just three cities – Sydney, Melbourne and Brisbane.

*Its wool, lamb, beef, wheat and wine industries remain world leaders, it holds a quarter of the world’s uranium reserves, the largest zinc and lead deposits, it is a major producer of tungsten and gold, has healthy deposits of silver and it is still a major producer of coal.

*The Malacca Strait is the shortest route from the Indian Ocean to the Pacific. It sees 80,000 vessels pass through it each year, carrying about a third of the world’s traded goods including 80 per cent of the oil heading for Northeast Asia

*China is by far its biggest trading partner, although levels of investment fluctuate sometimes in line with those of diplomatic warmth. China buys almost a third of Australia’s exported farm produce, including 18 per cent of its beef exports and half its barley. It is also a major market for Australia’s iron ore, gas, coal and gold.

IRAN

*Iran is defined by two geographic features: its mountains, which form a ring of crust on most of its borders, and the mostly flat salt deserts of the interior, along which run lower-range hills roughly parallel to each other. The mountains make Iran a fortress.

*Almost all Iranians live in the mountains. Because they are difficult to traverse, populated mountain regions tend to develop distinct cultures. Ethnic groups cling to their identities and resist absorption, making it harder for the modern state to foster a sense of national unity.

*Lack of water is one of several factors which have held Iran back economically. About one-tenth of the land is cultivated, a mere third of which is irrigated.

*Iran holds the world’s fourth-largest reserves of oil and second-largest of gas

*Strait of Hormuz: one-fifth of global oil supplies pass through it, closure would mean a world of pain. It would also cause massive disruption to oil and gas shipments from Iraq, Kuwait, Saudi Arabia and the UAE, leading to a huge rise in energy prices and potentially a global recession.

*When Tehran feels under pressure, especially when its oil exports are threatened, it uses a variation of a warning issued in 2018: ‘We will make the enemy understand that either everyone can use the Strait of Hormuz or no one.’

SAUDI ARABIA

*Saudi Arabia is the world’s largest country without a river and the interior is dominated by two vast deserts. It is the largest continuous area of sand in the world, covering a region bigger than France.

*The Saudis view Syria as an Iranian land bridge linking Tehran, via Baghdad and Damascus, to the Iranian-funded Shia Hezbollah militia in Beirut.

*Qatar and Saudi Arabia have been at odds since the mid 1990s, especially since Qatar set up Al Jazeera TV, which the Saudis say is hostile to them.

*The Saudis have long opposed the Brotherhood as it seeks to topple royal dynasties. In 2013 Riyadh supported the military coup in Egypt which deposed the elected Muslim Brotherhood leader Mohamed Morsi and replaced him with General Sisi.

*Saudi’s Vision 2030 accepts that the economy must be diversified, with the focus on technology and the service sectors. Budget projections for the next few years envisage a steady draining of foreign reserves and the sovereign wealth fund.

*The state pays for an exceptionally generous welfare system. Rapidly declining income from oil and gas means that this is unsustainable; but without welfare, and with high unemployment, unrest is all but certain.

*Saudi’s domestic oil consumption has been on an upward trend. The country burns about a quarter of the oil it produces, and that burns through a huge part of the government’s income. Petrol and electricity are supplied to the public at a fraction of even the lowest prices in most developed countries.

*Saudi Arabia is the sixth-largest consumer of oil in the world and air conditioners use 70 per cent of Saudi Arabia’s electricity.

*The kingdom has the largest desalination operation in the world, which successfully produces the majority of its domestic needs. The massive desalination plants require large amounts of electricity, which comes from oil.

*Saudi Arabia owns 5 per cent of Tesla, and has invested heavily in General Motors’ push towards electric cars.

*China has sold the kingdom intermediate-range ballistic missiles, its oil imports have grown rapidly in the past few years, and Saudi Arabia has signed one of the twelve 5G contracts Huawei has won in the region.

GREECE

*Greece includes more than 6,000 islands. Nowhere in Greece is more than 100 kilometres from water.

*Under international maritime laws a country has 200 nautical miles of Exclusive Economic Zone (EEZ) from its coastline.

*The waters around islands such as Crete, Rhodes and Lesbos belong to Greece, meaning that most of the Aegean is Greek territory – a fact that Turkey does not accept.

*Erdoğan has appeared in an official photograph of a 2019 visit to Istanbul’s National Defence University standing in front of a map showing half of the Aegean as belonging to Turkey.

*The term ‘Thucydides Trap’, originally about the growth of Athenian power and the fear that this caused in Sparta, now refers to the rise of China and the emotions this evokes in the US

*Four-fifths of Greece is mountainous, characterized by jagged peaks and spectacular deep gorges.

*There is limited scope for large-scale farming is why only about 4 per cent of GDP comes from agriculture; Greece imports significantly more food than it exports.

*The two world wars cost Greece 9,500 men but extended its land by 70 per cent.

*Greece, like Italy, believes it is being asked to be Europe’s border police, but without EU funding. Both fear they will be hosting refugees in squalid camps for years to come.

*The discovery of potentially huge reserves of natural gas in the eastern Mediterranean has complicated what was already a potential source of conflict between Greece and Turkey. Gas fields have been found off Egypt, Israel, Cyprus and Greece. Russia is watching the whole scene nervously as its dominant position supplying natural gas to Europe comes under threat.

TURKEY

*Around 97 per cent of Turkey’s land is in Asia, and most of it consists of Anatolia.

*The Bessarabian Gap is the lowland between where the Carpathian Mountains finish and the Black Sea begins. If you hold the Gap, you control the southern east–west route.

*Ottoman’s defeat by the Habsburg Empire at the gates of Vienna in 1683 marked the beginning of a long but steady decline, leading to the collapse of their empire in 1923.

*The Turks do not accept the treaty which then left Greece in control of most of the islands off the Turkish coast, and the loss of Kurdish and Arab territory in Syria still rankles with some.

*Within Turkish military circles, supporters of the concept of ‘Mavi Vatan’ – the Blue Homeland – are usually sceptical of their country’s membership of NATO and believe it to be an American plot (helped by Greece) to prevent Turkey from rising to its rightful place in the world. The Blue Homeland idea encompasses a world view in which Turkey will dominate the three seas around it – the Black Sea, the Aegean and the eastern Mediterranean.

*It’s thought that the name Istanbul comes from Greek speakers referring to visits as eis ten polin – ‘into the city’ – which transmuted into Istanbul.

*By 2020 Turkey had fallen out with Syria, Egypt, Saudi Arabia, the UAE, Kuwait, Israel, Iran, Armenia, Greece, Cyprus and France and had irritated all of its NATO allies by buying the S-400 missile defence system from NATO’s great rival – Russia.

*More than 50 per cent of Turkey’s 85 million population live in the greater Istanbul area or along the narrow coastal plains of the Black Sea and Mediterranean

*Around 90 per cent of the Euphrates River and 45 per cent of the Tigris River originate in the Anatolian highlands. The Euphrates flows into Syria and Iraq, and runs almost parallel with the Tigris before they merge in southern Iraq. The fertile land between them gave birth to the name ‘Mesopotamia’, or ‘between two rivers’.

*It’s often said that the Kurds are the largest nation without a state.

*Seventy per cent of Turkish military equipment is now built domestically, and the country has become the world’s fourteenth-largest arms exporter, although it’s worth noting that orders from NATO allies are few and far between. Its big-ticket project is the TF-X, intended as a state-of-the-art fighter jet to replace the F-16 by 2030.

*Turkey is expanding its capacity and now builds tanks, armoured vehicles, infantry landing craft, drones, sniper rifles, submarines, frigates, and in 2020 launched its first light aircraft carrier, which is capable of transporting helicopter gunships and armed drones.

SAHEL

*The word Sahel derives from the Arabic for shore, or coast, which is how early travellers thought of the area, having made the voyage across the world’s largest dry desert.

*It also forms a 6,000-kilometre-long corridor across Africa, connecting the Red Sea to the Atlantic.

*For thousands of years, periods of extreme dry or wet weather have caused the vast spaces of the Sahara to expand and contract, and thus have shaped the Sahel and its peoples – where they live, what they do and how they behave.

*Much of the Sahel fell under French control at the infamous Berlin conference of 1884–5 (where Europeans carved up Africa.

*French have thousands of expats in the Sahel states, including Niger, home to the uranium mines which help fuel the French nuclear industry and keep the lights on in French houses.

*In the last four decades of the twentieth century lake Chad shrank by 90 per cent causing a huge loss of fish, jobs and income among the millions of people in Chad and neighbouring countries who rely on its waters.

*Across the Sahel region 30 million people face ‘food insecurity’, of whom, according to the UN’s Food and Agriculture Organization (FAO), about 10 million are at extreme risk of hunger.

*Africa has the fastest demographic rate in the world. Between now and 2050 the population of the continent is expected to double from about 1.2 billion to 2.4 billion.

*Niger is the world’s fourth-largest producer of uranium but the government is locked into an unequal relationship with the French state-owned company Areva.

*Beijing is expanding military footprint in the Sahel. In 2015 China passed a law allowing the overseas deployment of the People’s Liberation Army. China persuaded Burkina Faso to end its recognition of Taiwan. In 2017 it opened its first foreign naval base – at Djibouti.

*China has funded an electric railway line from Djibouti to Ethiopia, and Chinese companies are busy building rail links connecting ports in Guinea and Senegal to landlocked Mali. Several hundred thousand Chinese workers are said to be involved in African Belt and Road activities.

ETHIOPIA

*Tourism accounts for almost 10 per cent of the country’s GDP, with close to 1 million people a year venturing into an epic landscape of high mountains, tropical forests, burning deserts, nine World Heritage sites

*Water defines Ethiopia’s geopolitical position and importance. Fresh water is its main strength, and saltwater one of its weaknesses (landlocked). It has twelve large lakes and nine major rivers, most of which supply its neighbours, giving Ethiopia enormous political leverage over them.

*After water, the most defining geographical element about Ethiopia is that a rift runs through it – the East African Rift system. The mountains and valleys it created have long divided the country, and its leaders have always struggled to build the bridges, both literal and symbolic, necessary to bring it together. Most of the coffee plantations, which are the biggest foreign-exchange earner, are situated there.

*Ethiopia is the leading military power in the wider Horn of Africa area.

*Ethiopia sits at the centre of one of the most troubled regions in the world. In this century Sudan, South Sudan, Somalia, Ethiopia and Eritrea have all experienced civil wars, while Kenya has been rocked by wide-scale ethnic clashes and has suffered numerous terrorist attacks by the Somali-based Al-Shabab group.

*Ethiopia was, famously, never colonized but, having built its own empire, it has similar problems within its borders. Ethiopia has nine major ethnic groups among its population. There are nine administrative areas and two self-governing cities, all based on ethnicity.

*It’s the most populous landlocked country in the world.

*Approximately 90 per cent of Ethiopia’s imports and exports travel by sea, and almost all cargo goes via the deep-water port of Djibouti.

*Turkey has been expanding its economic footprint in Ethiopia and is now the second-biggest investor in the country behind China.

*Biggest bone of contention between Ethiopia and Egypt is GERD (Grand Ethiopian Renaissance Dam). It is Africa’s largest hydroelectric power plant being built on Nile.

*For the Egyptians the building of the GERD is an existential matter – this is one of the clearest examples of a country being a prisoner of its geography.

*Egypt is mostly desert, and so 95 per cent of its 104-million-strong population live along the Nile’s banks and delta. Egypt has said it will use ‘all available means’ to defend its interests which has led many analysts to speculate that a major ‘water war’ was on the cards between Egypt and Ethiopia.

SPAIN

*Spain is a vast fortress. From the Mediterranean Sea and the Atlantic Ocean, narrow coastal plains quickly bump up against great walls of mountains and the entire central region is a plateau with its own high ranges and deep valleys. Spain one of the most mountainous countries of Europe.

*Spain’s mountainous terrain and size have always hampered trade links and strong political control, and ensured that the different regions retain strong cultural and linguistic identities. Such are the complexities and passions of these differences that the Spanish national anthem does not have lyrics as no one can agree on what they should be.

*Even at the height of Spain’s powers, its internal geography limited its wealth creation and political unity.

*Arabic in particular left its mark on Spain: more Spanish words are taken from Arabic than any other language apart from Latin. The very name Gibraltar comes from Tariq ibn Ziyad: the rock became known as ‘Jabal Tariq’ (‘Tariq mountain’).

*General Franco imposed an economic system known as autarky – self-sufficiency, state control of prices, and limited trade with other countries. It had a devastating effect. The 1940s became known as ‘Los Años de Hambre’ – the years of hunger.

*Basque Country spans two states, but many Basques consider it still to be one nation called ‘Euskal Herria’. Its language, Euskara, predates the Indo-European tongues of the rest of Europe and is unrelated to any of them. For example, ‘I live in Bilbao’ translates as ‘Ni Bilbon bizi naiz’ and is constructed as ‘I Bilbao in to live am.’

*Catalonia is the wealthiest region in the country, a fact which has played a role in the recent upheavals. Catalonia became wealthy through its textile industry, but now has a diversified economy including heavy industry and tourism.

*Spain is one of Europe’s leaders in renewable energy, especially solar and wind.

SPACE

*Everett Dolman created a maxim which echoes Halford Mackinder’s famous 1904 ‘Heartland’ geopolitical theory about control of the world, ‘Who rules East Europe commands the Heartland.’ Dolman’s version is: ‘Who controls low Earth orbit controls near-Earth space. Who controls near-Earth space dominates Terra. Who dominates Terra determines the destiny of humankind.’

*For the next few decades, the most important space exploration is Earth Space, particularly Low Earth Orbit (LEO). This is where our communication – and increasingly our military – satellites are being placed.

*More energy is required to get from the Earth’s surface to the Moon than from low Earth orbit to Mars.

*There are five ‘libration’ points near the Earth. These are places where the gravitational effects of the Earth and Moon cancel each other out, allowing objects stationed there to remain in position without having to use fuel.

*Military concept of ‘full-spectrum dominance’ now includes space, from low orbit to the Moon, and eventually beyond.

*Russia, China, the USA, India and Israel have developed ‘satellite-killer’ systems – specialist space weapons that destroy satellites.

*There are currently 3,000 dead satellites and 34,000 pieces of space junk at least 10 cm in size, and many smaller, orbiting the planet.

*Astronaut William Anders had taken the awe-inspiring ‘Earthrise’ photograph showing the surface of the Moon with the Earth in the background. It may be the most famous photograph ever taken and is credited with massive influence on the environmental movement.

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Billion Dollar Whale, Wright & Hope, 2018 - This could be the script of a hollywood thriller, as it has political intrigue, international financial fraud involving swiss and wall street banks (Goldman), sovereign wealth funds from 1MDB, Mubadala and ADIA, hollywood glitz and glamour from high profile figures like Leonardo DiCaprio and Scorsese being involved (Wolf of Wall St. was financed by funds siphoned from 1MDB) and of course the mastermind behind it all who most of us haven’t even heard of in Jho Low.

1MDB scandal was a fraud of serious proportions involving $12 billion which was siphoned off from the sovereign fund of Malaysia, explicitly setup for this purpose by Jho Low in which the then president Najib Nazak (now cooling his heels in prison) and family were closely involved. It is amazing how much you can fake it and make it in high-profile finance so some of these deals these so called VCs and wall st. banks are making isn’t surprising. It is perhaps easier to con people not dealing with their own money.

The book details the modus operandi and the people involved in very good detail. If at all you have ever wondered how funds are moved offshore to tax havens and routed back, or how networking works in high-society, or in general how political funding works in developing countries where sovereign funds siphoned are re-routed back to finance election campaigns as was done here to get Najib Razak re-elected.

The story goes all the way to the white house and to royal families in Abu Dhabi and Saudi, to Chinese govt.’s protection for Jho Low once the scandal came to light. It takes different level of guts to do something like this where even the Prime Minister of a country and his wife are in prison but the man behind it all still roams free and still parties in his yacht with celebrities. Financial thrillers are the best kind of books to get into the habit of reading, so if you are contemplating starting somewhere, start here. 8/10

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Alex in Numberland, Alex Bellos, 2010 - This book is a love letter to math and it explores math through the history of math and its progress. It also pays its due to Indian contribution to math, be it Vedic texts and their obsession with numbers large and small, Brahmagupta’s Zero or Madhava’s calculus and Ramanujan’s extraordinary intuition with numbers. For most of our evolution we had no numbers and when we did, we couldn’t count more than 5 and just used “more” or “a lot” for any number above 4 or 5.

I have been thinking philosophically about our obsession with numbers and how it feels satisfying while also being vacuous (like our CAGR / XIRR math). It is pointless to measure most of these. If you are doing well, it stands out so much making a compute unnecessary other than for intellectualising. I see some of these now as a conflict between the intuition (internal, single-player, infinite) and the intellect (external, multi-player, finite)

My notes -

A head for Numbers

  • Ethnomathematics - study of how culture/religion influenced mathematics

  • Munduruku (tribe in the Amazon) language has no tenses, plurals and no words for numbers beyond five. Working system of words and symbols for numbers is only ~10000 yrs old at most. Counting anything, be it fruit or children was considered ludicrous by most tribes

  • Staying in a forest for long, one forgets sense of numbers, time and space

  • We are taught numbers are evenly spaced (linear). Our perception of numbers though is logarithmic. We perceive less spaces between larger numbers (space between 10-20 is not same as space between 80-90 - we think in percentage increase 100% vs 12% intuitively!)

  • We perceive ratios more intuitively than we do counting. Which tree has more fruit or which tribe has more people is answered without “counting”

  • A tree 100m away from us and another a 100m behind that tree is not perceived the same (the far one appears shorter). We are however taught they are same (linear) removing this intuition

  • Our perception of time as well is logarithmic, hence time passes faster, the older we get (have oft wondered this), yesterday feels a lot longer than whole of last week

  • We use numbers mainly with quantity (cardinality or counts) and order (ordinality)

  • Ancient Indian numbers used -, =, ≡ and + for 1, 2, 3 and 4 (Very close to the numbers we use today)

The Counter Culture

  • Shepherds use 4 pebbles in their pocket to represent 80 sheep (base 20). Bases simplify how we count and throughout history, we have used 5,10 and 20 as bases. Without sensible bases, numbers become unmanageable

  • Base 12 (duodecimal arithmetik) is considered more natural and versatile - 12 is divisible by 2, 3, 4 and 6 while 10 only by 2 and 5

  • Sumerian cunieform has symbols for 1,10, 60 and 3600 (mix of base 10 and 60). Babylonians used the sexagesimal (base 60) system from Sumerians and made advances in astronomy and time - hence we use 60 seconds to the minute and 3600 to the hour (Attempt was made to decimalise time in 17th century - each day having 10 hours, with 100 minutes each with 100 seconds - 10k secs in a day but it failed)

  • Leibniz fell in love with binary and felt the 1 and 0 represented being and nothingness. I Ching also uses 64 symbols (Fu Hsi) that’s close to modern binary

  • Abacus was invented to count but was more useful with arithmetic. People used to using Abacus can perform math much faster by visually processing arithmetic (soroban) than using pen and paper which uses natural language that’s more tedious

Behold

  • Square of a number n is the sum of the first n odd numbers (4^2 = 1 + 3 + 5 + 7 = 16). Intuition in squares made of pebbles visual

  • Pythagorean brotherhood was a health camp, brotherhood and an ashram (math religious cult). Pythagoras discovered that length of vibrating string when halved increased the pitch by an Octave. Finding order in everyday things was their religious awakening

  • Pythagorean brotherhood is the model for several occult secret societies, including freemasonry

  • Right-angled triangle with sides with ratio of 3:4:5 was known as Egyptian triangle

  • Euclid’s Elements was a magnus opus of pedantry and rigour :slight_smile: Nothing assumed, except few basic axioms and everything followed logically from them

  • Since The Elements, logical reasoning has been the standard for all human enquiry

  • Platonic solids are perfectly symmetrical and there’s only 5 of them (tetrahedron, cube, octahedron, icosahedron, dodecahedron)

  • 4 ways to define centre of a triangle - orthocentre, circumcentre, centroid, midcircle (lookup definitions). Euler proved that these always lay on the same Euler line

  • Tessellate - cover a plane so that no region is uncovered (with repeating regular polygons like square, triangle or hexagon). Tesselation thus produced were periodic (repeating)

  • Non-periodic tesselations which for a long term were believed to be impossible can be produced by penrose’s dart and kite (fascinating)

  • 3-D versions of penrose’s tiles is present in quasicrystals. Again, crystals were assumed possible only from platonic solids (Mosaics in Iran, Iraq and Turkey had penrose patterns 5 centuries before it was discovered in the west)

  • Hinduism used geometry to illustrate the divine - Sri Yantra, made with 5 triangles pointing down and 4 pointing up (structure described in a long poem) is hard to construct

  • Origami is now the cutting edge of maths. Protein folding, arterial stents, robotics, solar panels and satellites have applications for origami

Something about Nothing (Zero)

  • Lalitavistara sutra expresses numbers higher than a koti (crore). 100 koti is ayuta, 100 ayuta is kankara and so on until tallakshana which stands for 10^53 (Entire universe measured in meters and then squared would be around 10^53)

  • There were several systems above like dhvajagravati and dhvajagranishamani that could count all the way up to 10^421 (Every atom in the universe 10^80, multipled by planck time 10^43 parts to the second would be 10^140 unique configurations to the universe since its beginning - still smaller than 10^421)

  • The ancient sanskrit texts also have numbers going all the way down to size of a carbon atom. Buddha is said to have been an expert in numbers large and small - a metaphysical obsession perhaps in groping towards the infinite

  • In contrast, Greek culture did not have the Indian hunger for numbers and had their largest number as myriad or M which stood for 10,000

  • MMCDLI is larger than DCLXXXVIII which goes against common sense. Neither Romans, Greeks or Jews had a symbol for zero

  • Vedas contain numbers from Dasa (10), Sata (100) all the way up to Parardha which stands for a trillion. Indian astronomy was way ahead because its astronomers and astrologers had the vocabulary for these large numbers

  • Brahmagupta showed in 7th century how shunya behaved towards other number siblings. (Fascinating stuff based on fortunes, debts and shunya)

  • The less maths was tied to actual things, the more powerful it became

  • Modern decimal system from Indian system with 10 numerals, place value and all-singing, all-dancing zero was brought to Europe Fibonacci in 12th century (Liber Abaci) through the Islamic world

  • Long division and long multiplication were the technological novelty of the 13th century

  • Zero cannot be annihilated or destroyed. It means nothing, it means eternity. The conceptual leap happened in a culture that accepted the void as the essence of the universe

Life of Pi (Geometry)

  • Many mathematicians are poor at arithmetic. Ability to calculate rapidly has no correlation with mathematical insight or creativity

  • Ancient civilisations realised that the ratio of circumference to the diameter of a circle was always constant (pi)

  • Archimedes loved to grapple with problems in the real world unlike Euclid who liked to deal in abstractions

  • Though the origin of calculus is debated between Leibniz and Newton. A version of it was invented in the 14th century by Indian mathematician Madhava

  • 35 digits of pi is sufficient to calculate circumference of earth to the centimeter. 1947, we had 808 digits to pi. 1949, ENIAC took 70 hrs to calculate it to 2037 digits. The numbers obeyed no obvious pattern. Today pi is known till 31.4 trillion digits

  • When people use “lowest common denominator” to mean something basic and unsophisticated, they actually mean “highest common factor” (LCD is usually big while HCF is small)

  • Numbers that cannot be expressed as fractions were “irrational”. Hippasus who proved their existence was drowned at sea by the Pythagorean brotherhood

  • Pi was present in places that did not involve geometry, from pendulum swings, to distribution of deaths in population to probabilities in coin tosses

  • Ramanujan formula calculated pi with remarkable speed and was a industrial strength pi making machine (fascinating formula! how the hell did he come up with it?)

  • Digits in pi are pre-determined but still mimic randomness very well

  • Reuleaux triangle (Similar concept to non-circular wheels - height from floor to top remains constant) and Watt’s drill can drill square holes

The X-Factor (Algebra)

  • Descartes’s La Geometrie introduces algebraic notation used today. He used alphabets from the end for unknowns (x, y and z). The printer ran out of y and z as french used them extensively and so chose “x” instead for unknowns

  • Ease in stating a problem has no correlation with ease in solving it (Eg. Fermat’s theorem)

  • Logarithms turn the complicated process of multiplication into the simpler process of addition (Division was subtraction, square roots, division by 2 and cube roots by 3)

  • Richter scale uses logarithms, so an earthquake of scale 7 is 10x higher in amplitude than one with 6

  • Peter Roget invented thesaurus due to his OCD of making lists to deal with his mental illness. He also invented log-log scale that helped with calculation fo fraction of power like 4^3.5

  • Descartes integrated algebra and geometry with his Catesian co-ordinate system (thus was born a way to visualise abstract notions)

Playtime (Puzzles)

  • Rhind papyrus contained the numbers 7, 49, 343, 2401, 16807 - probably first known occurence of geometric progression. Illustrates the counter-intuitive growth when a number is multiplied by itself a few times

  • Sudoku was invented by Kaji in 1980s but it took off only in the late 90s when it was published in newspapers (Led to 700% rise in pencil sales in UK and top 6/50 books were sudoku related in 2005)

  • Puzzles have always given rise to and grown mathematics. A bridge crossing puzzle from Russia led to the invention of Graph theory by Euler

  • Tangrams, Rubik’s cube, sudoku and fifteen puzzle - 4 internationally crazed math puzzles. Rubik’s cube also involved some clever engineering

Secrets of Succession (Combinatorics)

  • Every even number above 2 can be expressed as sum of two primes (Goldbach’s conjecture). Its as yet unproved though no even number has been found to disagree with it. Primes are scattered unpredictably on the number line

  • Persistence of a number - Number of steps it takes to get to single digit when the digits are multipled with each other Eg. 88 → 8 x 8 = 64 → 6 x 4 = 24 → 2 x 4 = 8 (Persistence is 3). Persistence of large numbers is surprisingly small - because they invariably have a zero somewhere, collapsing under their own weight

  • Recaman sequence generates numbers that look like a garden sprinkler when plotted (Music generated with these sequences sound chilling like a horror movie soundtrack)

  • Prime that can be written as 2^n - 1 is a Mersienne prime

  • GIMPS - Great Internet Mersienne Prime Search. There’s a linear relationship between number of digits in prime and computing power when plotted in log plot

  • The concepts of continuity and discreteness are not completely reconcilable (Zeno’s paradox for eg.)

Gold Finger (Fibs and Golden ratios)

  • Golden ratio - Ratio of A+B : B is same as ratio of A : B. This led to Greek fascination with phi (1.618) and their discovery of it in the Pentagram and subsequent worship

  • For most flowers number of petals is a fibonacci number (Even when its not, like a 4-leaved clover, the avg. is)

  • Golden ratio is approximated by the ratio of consecutive fibonacci numbers (1, 2, 1.5, 1.667, 1.6, 1.625, 1.615, 1.619…)

  • Nautilus shells and several spiral galaxies are logarithmic spirals - self-similar and never growing out of shape as they grow bigger

  • Phi is omnipresent. Peregrine falcons descend on prey in logarithmic spirals. Plants arrange leaves to the golden ratio (of angles) so each leaf gets sunlight

  • Cig. packs, credit cards and books often have length and breadth in golden ratio as we find it most appealing (Even the original iPod)

Chance is a fine thing (Probability)

  • Slot machines in casinos make $25 billion post payouts (2.5x total movie tickets sold)

  • “The book on games of chance” by Cardano was so ahead of its time that it was only published 100 yrs after his death

  • Randomness was not seen as randomness but as an expression of divine will (Caeser’s time)

  • Invention of probability was the root cause of the decline of superstition and religion

  • Pascal’s Wager - If there’s the slightest chance that God exists, a non-believer has nothing to lose by believing in him

  • Every bet in Roulette has a negative expected value. Craps on the other hand is the best deal (Expectation-wise)

  • Core concept of building gaming machines is expected value and the law of large numbers (IGT builds these)

  • IGT’s slot machines can be cherry dribblers or high-volatility - small prizes more often or large prizes rarely (payout rate remains same but plays with emotions differently). The sole objective is to keep the user playing because longer he plays, more he loses

  • Insurance is a negative expectation bet often taken to protect something someone cant afford to lose. Actuarial tables and how slot machines are designed aren’t very different

  • Insuring against losing a non-catastrophic amount of money is pointless (Don’t buy insurance against household electronics for eg.)

  • The belief that jackpot is “due” (because it hasn’t been in awhile) is gambler’s fallacy. Slot machines feed on it. True randomness has no memory of what came before. Truly random iPod shuffle felt less random, so Apple had to tweak it to be less random to make it appear more random :slight_smile:

  • Even the most miserly slot machines have a payback percentage of 85%, lotteries have 50% or less

  • Gambler’s ruin, is the eventual return to zero in a random walk on an iterative bets with long run negative expectations

  • Maximising wealth requires minimising the risk of losing it all. With small edges and judicious money management, huge returns can be achieved

  • Thorp’s “Beat the Dealer” was the first ever “quant” book, followed by his “Beat the market” for financial securities

Situation Normal (Statistics)

  • The ability to describe the world in quantitative rather than qualitative terms changes our relationship with our surroundings

  • Poincare noticed the distribution of sizes/weight of bread and saw the bell curve. Even before Poincare, Quetelet noticed it in frequency of murders in population

  • Maxwell and Boltzmann’s kinetic theory of gases heavily relied on Quetelet’s statistical thinking to explain pressure of gases

  • Reading Pascal’s triangle diagonally gives a fibonacci series. Ancient Indian texts also had versions of Pascal’s triangle

  • The bell curve is ubiquitous because we look for it actively and we often choose what serves our interests

  • Regression and correlation were big breakthroughs in modern scientific thought

The End of the Line (Non-Euclidean Geometry)

  • Hyperbolic geometry or non-Euclidian geometry came about in 19th century on assuming Euclid’s carefully laid out rules as False

  • “The Elements” was the bible of mathematics, so assuming fifth postulate (parallel postulate) to be false was untenable and yet thats what gave rise to a new form of mathematics and subsequently a new understanding of the world

  • Riemann’s lecture of 1954 dealt with positive (spherical) and negative curvature (hyperbolic) of space and integrated Euclidean and non-Euclidean geometry

  • Parallel lines in hyperbolic space get further and further apart from each other

  • Hyperbolic surfaces maximise area while minimising volume (Pringles chips). Some plants and corals expose large hyperbolic surface for nutrition

  • One geometry cannot be more True than the other, just merely more convenient - Poincare

  • Cantor figured out that infinity could come in various sizes (countable infinities and Hilbert hotel)

  • After Riemann and Cantor, mathematics umbilical cord with our experience of reality was cut-off

I thought this would be a daunting read but it was similar in structure to ‘The Joy of X’ and I enjoyed it as much as I enjoyed Strogatz’s book. I haven’t even captured a tiny portion of mathematical, anthropological and historical knowledge contained in this book. Read this even if you hated math in school. I was contemplating taking up serious math few months back and this book only made that resovle stronger. 11/10

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Well I was planning to add my review about Shoe Dog , but you have well summarised it ! Some thing’s which I thought of adding are below :

Personal View :

  1. It was one of the books which showed what it took to built such a great business and how at every turn there is an obstacle which needs to be taken with a different approach , but what matters is your determination and your passion to reach your end goal .

  2. What else it taught me was history and how the business changed throughout from 1960s to 1980s and how doing international business was so tough back then , and it changed over time . Nike was the first shoe-company to enter into the Chinese market breaking the 25 years of no business with China. Later on out of the 5000 employees they had worldwide in 206 , 800 were from China itself ( The seeds which were planted in 1980) !

→ When the author was confused if he should pursue studies or continue with his current job , or look for a better job
Soln : "Everyone, but everyone, changes jobs at least three times. So if you go to work for an investment firm now, you'll eventually leave, and then at your next job you'll have to start all over. If you go work for some big company, son, same deal. No, what you want to do, while you're young, is get your CPA. That, along with your MBA, will put a solid floor under your earnings. Then, when you change jobs, which you will, trust me, at least you'll maintain your salary level. You won't go backward.”

Some real life images to visualise the things discussed on the book :

  1. At first they had partner shipped with onitsuka and they had built one of the first mordern looking shoe named “Aztec” but had to rename because of the similar name by adidas , and they didn’t had the financial power to fight , so they changed it to Cortez who had defeated Azetec (irony) xD

  2. Prefontaine(the inspiration for Phil Knight) - Nike (6453 ) Best time record 3:54.6 ( When nike number’s in keybad reversed )

  3. When Phil in 1971 had gone to Japan to setup first nike plant there ( some of the name’s of the shoes he had thought of on spot )-

Lastly inspired by this -
" You measure your self by the people who measure themselves by you “

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How Proust can change your life, Alan De Botton, 1997 - This is an author I have grown to like after reading his hilarious and insightful work “Essays in Love”. This is however a completely different work where he examines Proust’s works as one would examine a glass of fine wine. Proust, for the uninitiated, wrote the seven volume magnum opus “In Search of Lost Time” that is acknowledged to be a classic. It is incredibly long, incorrigibly slow (even for its time in early 1900s) and probably a book pretty much no one currently has the time for. Proust was a hypochondriac who never left his room and stayed in bed unless completely necessary to leave it and wrote in great depth from memory and made time slow down to a stop where a single scene might go on for over 100 pages, almost like a still life painting. This book was a delightful read examining this great work almost playfully.

My notes -

  • Proust’s seven volume In Search of Lost Time (ISoLT) had the search for the causes for dissipation and loss of time as its central theme

  • Every reader is, while he is reading, the reader of his own self (in communion with the book, the reader discovers himself, rather than what the author says)

  • Art affects, rather than distracts

  • When two people part, its the one that is not in love that makes the tender speeches

  • One of In Search of Lost Time’s (ISoLT) defining, awkward features is its length. One must have been very ill or broken a leg to have read it :slight_smile:

  • First 30 pages of the book (ISoLT) describes the author tossing and turning, trying to fall asleep (I remember wondering what the heck is this while reading it but slowly the book took me in and kept me there, back in 2010)

  • Greatness of a work of art has nothing to do with the subject matter but the treatment of it

  • Proust enjoyed reading train timetables when he couldn’t get sleep :slight_smile:

  • By not going too fast we give the world a chance to get interesting

  • The self-satisfaction felt by “busy” men, however idiotic their business, at not having time…

  • A good way of evaluating wisdom of someone’s ideas might be to examine the state of their own mind and health. If someone had to reap its benefits, it should at least be its creator

  • Proust was very attached to Mme Proust (mother). She was well-meaning but bossy. A young Proust would write letters to her and leave it by her door for her to find in the morning (The first 100 pages of ISoLT vol 1: Swann’s way explores this bond)

  • Mme Proust preferred for her son to be ill and dependent, rather than healthy and well - enacting a nurse-patient relationship

  • “Even though you are 50, you are same as I first knew you, namely a spoilt child” - Proust’s stockbroker

  • Feeling things (often painfully) is linked at some level with the acquisition of knowledge

  • We don’t really learning anything properly, until we are in pain, until something fails to go as we hoped

  • Thoughts can be painless (Arising out of no particular discomfort, other than a disinterested wish to find out say, how sleep works or why people forget) or painful (arising out of distressing inability to sleep or even remember a name). Proust had the privilege of the latter

  • Wisdom cannot be taught, we have to discover it for ourselves

  • Philosophers should concern themselves with being “properly and productively unhappy”, rather than in the pursuit of happiness

  • A woman felt faint in the library not since she was averse to books but that she sought their knowledge by wanting to have read them all at once. Surrounded by books, she developed the urge to flee her unbearable ignorance to a less knowledge-laden environment

  • Peppering French with bits of English was how you seemed smart and in the know in 1900s France

  • Problem with cliches is not that they contain false ideas, but that they are superficial articulation of very good ones

  • Way we speak is linked to the way we feel. How we describe the world is linked to how we experience it

  • Cliched phrases are a caricature of fineness, pompous ornamentation stolen by an author of later period to suggest literary grandeur

  • Cliches are problematic since the world contains a far broader range of rainfalls, moons, sunshine and emotions than stock expressions can capture

  • Every successful work of art restores to our sight a distorted or neglected aspect of reality

  • Conversation gives us little room to refine what we want to say as writing does. We have a tendency to not know what we want to say until we have had at least one go at saying it

  • We feel gossip about ourselves to be soaked in malice when we dont attribute any malice to the last person we gossiped about

  • Proust preferred reading than spending time with his author friends since he could put away Moliere as if he had neither genius nor celebrity when he was bored of him

  • Most interesting would be the letters we finish and don’t send than ones we do (Proust had a lot of nasty unsent letters discovered after his death)

  • ISoLT was like an unusually long unsent letter where the unsayable was granted expression

  • Our dissatisfactions maybe a result of our way of looking at our lives, rather than anything inherently deficient in them. Emphasis on perspective, rather than possession

  • Chardin’s salt cellars and jugs, Elstir’s cotton dresses and harbours and Proust’s madeleine evoking memories of childhood - such modesty is the characteristic of beauty (Proust would have perhaps approved of Raymond Carver’s style of writing)

  • Presence of a thing may be the very element that encourages us to neglect or ignore it. Real form of possession according to Proust is “imaginative possession”

  • To bring back to life, from the deadness of habit and inattention, valuable yet neglected aspects of experience (The way Carver would describe a kitchen counter for eg.)

  • It is our own thoughts we develop even as we read another person’s words

  • Capacity for insights in one topic does not mean worthwhile insights in another area, although it is natural for us to be misled so. (like VCs writing on finance)

  • A good book may nearly silence us as a writer. It might strike us as so perfect as to be inherently superior to anything we might come up with. (Virginia Woolf was nearly silenced by Proust)

  • Food has a privileged role in Proust’s writings. It is lovingly described and appreciatively eaten

  • A genuine homage to Proust would be to look at our world through his eyes, rather than look at his world through our eyes

  • Even the finest books deserve to be thrown aside

When you don’t have the time and resources to travel, you might delight in the narrated experiences of an adventurer or a travel blogger. In a similar fashion, if you don’t have the luxury of time, patience and taste to devour Proust, this is the closest you can get to understanding what’s so great about his work. This however, is not a one-dimensional singing of praises but a equal parts hilarious, dispassionate and critical dissection of Proust. 9/10

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Edible Economics by Ha-Joon Chang (2022)

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In this light yet insightful book the author takes you on a whirlwind tour twining food and economics. Each chapter starts with historical and cultural context of a food item and then goes off in multiple tangents, ultimately converging to a thought/lesson in economics.

The book is structured very differently than what I have captured in my notes below. I have only taken out some stories I found interesting:

Brazil and ethanol blending

*As the largest producer of sugar cane in the world, Brazil had experimented with the use of ethanol as a fuel for motor cars since the early twentieth century.

*After the first Oil Shock in 1973, the Brazilian government introduced an ambitious programme to promote the substitution of petroleum with ethanol.

*Brazil’s 1975 National Ethanol Program (Proálcool) subsidized both sugar producers’ investments in ethanol production capacity and the price of ethanol at the pump.

*In the late 1970s, car producers operating in Brazil (such as Fiat and Volkswagen) even developed engines that could exclusively be run on ethanol.

*By 1985, 96% of all new cars sold in Brazil had all-ethanol engines. Since then, there have been ups and downs for the programme, with fluctuations in oil price, sugar cane production and the scale of government subsidies.

*The launch of the ‘flexi-fuel’ cars, which can run on any mixture of gasoline and ethanol, by Volkswagen in 2003, followed by other manufacturers, has secured ethanol’s place as a major energy source for Brazil.

*Today, ethanol supplies 15% of Brazil’s annual energy production.

How slavery built America

*Cotton and tobacco alone accounted for at least 25% and up to 65% of US exports throughout the nineteenth century. Without these the US could not have imported the machines and the technologies that they needed for economic development from the then economically superior European countries.

*Enslaved Africans didn’t just provide (unpaid) labour, they were also very important sources of capital –slaves were used as collateral for mortgages centuries before the home mortgage. In colonial times, when land was not worth much, most lending was based on human property.

*Individual-slave-based mortgages were lumped together to form tradable bonds, just like modern-day ABSs (asset-backed securities). These bonds were sold on to British and other European financiers, enabling the US to mobilize capital on a global scale and also to develop its financial industry into a global player.

*In 1791, the slave rebellion of St Domingue (today’s Haiti) stopped the westward expansion of Napoleon, which in a way forced France to sell Louisiana to the US.

Technological innovation in dye industry

*The invention of artificial dyes in Britain and Germany devastated producers of natural dyes all over the world.

*Artificial red dyes, such as alizarin, wiped out the riches of Guatemala. At the time, Guatemala heavily depended on the export of cochinilla (cochineal), a highly prized crimson dye that was used to dye Catholic cardinals’ robes.

*When it developed the technology to produce alizarin out of coal tar in 1868, BASF (which was later mass-producing fertilizer out of thin air) was making the most prized red colour from the blackest thing – coal.

*BASF also developed the technology to mass-produce artificial indigo, another highly prized dye, in 1897, and destroyed the indigo industry in India, ruining the livelihood of many Indian labourers, not to speak of bankrupting many British and other European indigo plantation owners.

Nothing natural about ‘natural’ resources

*Until the 1880s, Brazil had a monopoly over rubber. But the Brazilian economy was hard hit when the British smuggled the plants out of Brazil and established rubber plantations in their colonies in Malaysia, Sri Lanka and other tropical areas.

*In the 1970s Malaysia was producing half the world’s rubber. It suffered from the increasing competition from various types of synthetic rubber developed in the first half of the twentieth century. Malaysia subsequently diversified into other primary commodities, like palm oil, and into electronics.

*Rubber may be a Brazilian crop, but the three largest producers of rubber these days are Thailand, Indonesia and Malaysia. Brazil isn’t even in the top ten.

*In the mid-1980s, Vietnam exported virtually no coffee, but subsequently it increased its coffee export very quickly. Since the early 2000s, it has been the second-biggest exporter of coffee in the world, after Brazil, seriously affecting other coffee-producing countries.

*Chocolate is originally from Latin America (Ecuador and Peru), but today the world’s top five producers of cocoa are in Africa and Asia (Côte d’Ivoire, Ghana, Indonesia, Nigeria, and Cameroon are the top five producers)

*China was originally the exclusive producer of tea, but these days India, Kenya and Sri Lanka are also major producers of it.

*The Netherlands may have very little land but it has become the second-largest agricultural exporter in the world – only behind the USA – because it has found ways to augment land through technologies.

Farming prawn, shrimp & other insects

*Huge tracts of mangrove forests are destroyed to make way for prawn/shrimp farms, especially in Thailand, Vietnam and China. Around of one-fifth of the world’s mangrove forests had been destroyed since 1980, mostly to make such farms.

*This is a serious problem as mangrove forests offer protection against floods and storms, serve as nurseries for baby fish.

*Farming insects generates virtually no greenhouse gas and requires only 1.7kg of feed per 1kg of live weight, as opposed to 2.9kg of greenhouse gases and 10kg of feed in the case of beef, the worst offender.

*Insects also require much less water and land per gram of protein produced compared to animals.

*In the 1950s, Japan was the world’s biggest exporter of silk (both raw silk and silk textile), and silk was the country’s biggest export item.

*Japan had a long history of silk textile-making, since it got sericulture from Korea in the seventh century, but its silk industry came to its own in the early post-Second World War years.

Uruguay

*In 1912 Uruguay became the first Latin American country where women won the right to file for divorce without a specific cause. It was one of the first countries in the world where women acquired the right to vote (in 1917). In 2013, it became the first country to legalize marijuana.

*The beef industry is another area in which Uruguay has been at the top of the international league. Currently, it is the country with by far the highest number of cattle per (human) capita.

*The beef industry is imposing huge environmental burdens on the planet in terms of greenhouse gases, deforestation and water usage.

Bananas

*It is estimated that 85% of bananas are consumed in places where they are produced.

*In many African countries, bananas are also brewed into beer.

*In the process of domestication, the seedless mutants were selected for having more edible parts, which led to banana losing its ability to reproduce by natural means.

*Domesticated bananas cannot be propagated without human intervention that involves the removal and replanting of vegetative cuttings of the offshoots. Bananas spread in such a way are, as a result, all genetically identical.

*The Portuguese adopted the word ‘banana’ from Bantu languages of West-Central Africa.

*Colombia and Ecuador are the biggest banana exporters in the world these days.

*Almost all (95%) internationally traded bananas (and about half of all bananas produced worldwide) are of one variety, the Cavendish, even though there are over 1,000 varieties of banana around the world.

*The limited gene pool makes it difficult to control diseases for the banana. Currently, there is a worry that the Cavendish banana, which accounts for 95% of internationally traded bananas, may be wiped out by so-called Panama disease. The banana industry is in this situation because it has repeated its historical mistake of reducing genetic diversity in pursuit of profit.

Neo vs classical liberalism

*Neo-liberalism is a post-1980s version of nineteenth-century classical liberalism. Both versions of liberalism, classical and ‘new’, advocate strong protection of private property, minimal regulation of markets, free trade and free movement of capital.

*Neo-liberalism, however, is not as openly opposed to democracy as the old one was which argued that democracy will allow non-propertied classes to destroy private property and thus capitalism

*Neo-liberalism, differently from classical liberalism, opposes free markets in things like currency (it advocates a strong central bank, which has monopoly over currency issue) and ideas (it advocates a strong protection of intellectual property).

Welfare state

*The point of the welfare state is that, as citizens (and long-term residents), we all get the same package of insurances at a lower price by buying in bulk.

*In 1930, the welfare state (or more technically, social spending, which includes income support for the poor, unemployment benefit, pensions, health and housing subsidies) typically accounted for 1–2% of GDP in today’s rich countries, with Germany having the biggest one at 4.8%. By 1980, these countries were spending 15.4% of GDP on social spending on average. Today (the 2010–16 period), the corresponding figure is 20.8%.

Automation

*Automation may reduce labour requirement per unit of output, but it may also increase the overall labour demand (and thus create more jobs) by making the product cheaper and thus increase the demand for it.

*During the nineteenth century in the US, automation eliminated 98% of the weaving labour required to produce a yard of cloth, but the number of weavers actually grew by four times, because the demand for cotton cloth, thanks to the lower price, increased so much.

Post-industrialism

*The discourse of the post-industrial age, originating from the 1970s, starts from the simple but powerful idea that people increasingly want finer things as they become richer. When most people have the basic things (food, clothes, furniture, car) the consumer demand shifts to services – eating out, theatre, tourism, financial services and so on. At that point, industry begins to decline, and services become the dominant economic sector, starting the post-industrial age of human economic progress.

*The advocates of post-industrialism fundamentally misunderstand that what is driving deindustrialization is mainly changes in productivity, not changes in demand.

*The more prevalent view of Switzerland is that it is a model for the post-industrial economy, in which prosperity is based on services, like finance and high-end tourism, rather than manufacturing.

*On the contrary, Switzerland the most industrialized economy in the world, producing the largest amount of manufacturing output per person.

*We don’t see many ‘Made in Switzerland’ products because it specializes in what economists call ‘producer goods’ – machines, precision equipment and industrial chemicals – that ordinary consumers, like you and me, do not see.

*The secret of Swiss success is the world’s strongest manufacturing sector, and not things like banking and upmarket tourism, as we commonly think.

*Contrary to the myth of post-industrialism, the ability to produce manufactured goods competitively remains the most important determinant of a country’s living standards

*Manufacturing is still the main source of technological innovation. Even in the US and the UK, where manufacturing accounts for only around 10% of economic output, 60–70% of R&D (Research and Development) is conducted by the manufacturing sector. The figure is 80–90% in more manufacturing-oriented economies like Germany or South Korea.

Myth of free trade

*The best example of myth in economics is the distorted historiography that tells us that Britain and then the US became the world’s economic hegemons because of their free-trade, free-market policies – when they were the countries that most aggressively used protectionism in order to develop their national industries.

*While forced free trade was spreading around the globe throughout the nineteenth and the early twentieth centuries, protectionism was the norm among the countries in Continental Europe (except in the Netherlands and Switzerland) and North America.

*The US was a particular offender in this regard – it had average industrial tariff rates around 35–50% between the 1830s and the Second World War, which made it the most protectionist country in the world during much of this period.

Miscellaneous

*Lime is the key ingredient in the Brazil’s national alcoholic drink, caipirinha. It’s made from lime juice sugar, and cachaça, Brazil’s national liquor.

*Originally, carrots, which come from Central Asia used to be white. Subsequently, purple and yellow varieties were developed. The now-dominant orange variety was developed in the Netherlands only in the seventeenth century.

*People made high investments in education in the Confucian countries not because Confucius emphasized erudition but because land reform and other policies introduced after the Second World War increased social mobility and thus the return to education.

*The Carolina Reaper, with up to 2.2 million SHU for the hottest specimen, has been recorded as the hottest chilli in the world.

*The Universities of Oxford and Cambridge did not accept non-Anglicans (e.g., Catholics, Jews, Quakers) until 1871 and didn’t award degrees to women until 1920 and 1948 respectively

*Though engineering is one of the most male-dominated subjects, but 50% of engineering graduates are women in Cyprus.

*The gender wage gap is around 20% on average worldwide, although it could be as high as 45% as in Pakistan or Sierra Leone or as low as zero, as in Thailand, or even negative, as in the Philippines or Panama.

*The search for the cure for scurvy was so important in the discovery of vitamin C that the scientific name for the vitamin is ascorbic acid, which literally means ‘anti-scurvy acid’.

*Brazil’s manufacturing sector, which accounted for around 30% of its national output in the late 1980s declined to just above 10% by the end of its Pink Tide.

*Germany is the largest producer of rye, 33% more than the next biggest producer, Poland. Rye is so important for Germany that it even features prominently in its historiography.

*The Spaniards brought chocolate back home from Mexico in the sixteenth century after their conquest of the Aztec empire, which is why the current names of the substance derive from the Aztec word, xocolātl.

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I came across this VP thread recently and I am amazed by the insights you give about a book. I am almost made up my mind to go through this thread before I find out any book to see if you have given any insights/summary about the book. Please keep doing this. It helps a lot !

will complete the rest of the thread in few days.

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Truly amazing in depth insights in this thread

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Reading this whole thread can be defined as reading many books in 1 book … Keep up good work bro … keep sharing … Got few wonderful book recommendations from this thread … cheers

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The Biology of Belief, Bruce Lipton, 2005 - These are the sort of books I would have frowned at a decade back with my hard-science upbringing. This book transcends the known and understood science of cell biology (author is a cell biologist) and epigenetics and delves into conjectures of how it affects our behavior and psychology. It brings in quantum mechanics briefly to argue how at the membrane and protein level, interactions are not strictly just through physical molecules but could also be through energy and charges (which influence the receptor proteins) and how looking at things as objects, interactions and causes and effects from our Newtonian conditioning through classical mechanics might not be the right way to go.

My notes -

  • A cell’s life is controlled by the environment as much as its genes. Genes get turned on or off based on physical and energetic environment

  • We are made of about 50 trillion single cells (essentially a community of citizens)

  • Most people believe in genetic determinism and think their fate cannot be changed. Nothing can be more irrational. You can change your life by changing your beliefs

  • Signal Transduction is how cells respond to environmental cues. This perception through reflexive biochemical pathways for single cells is more varied in higher-level multicellular organisms that perceive the environment through multiple senses (Our perception changes our biology)

  • Epigenetics - Control above the genes. Study of how environment selects, modifies and regulates gene activity

  • Many of the beliefs propelling your life are probably false and self-limiting

  • Electron microscopes are 1000x more powerful than conventional light microscopes and can magnify 100000x to observe cells and even their molecular structure

  • As a nation reflects the traits of its citizens, so does the human-ness of our cellular communities

  • A fully conscious mind trumps both nature and nurture

  • Anthropomorphism - Explaining nature of things not human in human behaviour terms

  • Organelles of the cell are suspended in a jelly-like cytoplasm - similar to organs and tissues of our bodies

  • Each eukaryote (nucleus containing cell) possess the functional equivalent of our nervous system, digestive system, respiratory, excretory, endocrine, muscle and skeletal, circulatory, integumentary (skin), reproductive and even a primitive immune system

  • Each cell is an intelligent being that can survive on its own

  • Like humans, single cells analyse thousands of stimuli from the micro environment they inhabit

  • Single cells are also capable of learning and creating cellular memories and also passing them on (antibody protein for measles virus is remembered and passed on this way)

  • Within the first 600 million years of Earth’s formation, there was single-cell life and for the next 2.75 billion years, there were only single cells

  • Around 750 million yrs ago first multicellular life appears in 10s and 100s of cells living together. The evolutionary advantage soon preferred larger communities of millions, billions and even trillions of cells

  • Awareness leads to survival. A colony of cells multiplies this awareness

  • Differentiation led to specialisation and distribution of workload among different members of the community (Not unlike our society)

  • Division of labour and specialisation (only a fraction of cells involved in perception for eg.) was a huge survival advantage (more can live on less)

  • Lamarck suggested evolution was based on instructive cooperation of organisms in an environment, 50 years before Darwin (He wasn’t entirely right but it somehow became fashionable to denounce Lamarckism)

  • The sharing of genetic information (gene transfers) can speed up evolution (acquiring learned experiences through others)

  • Tinkering with the genes of tomato may alter the biosphere in ways we cannot foresee (systems biology). Genetically modified agri crops may give rise to superweeds for eg.

  • Evolution is more dependent on the interaction of species than among individuals of a species (Lenton. Sounds similar to Lovelock’s Gaia hypothesis)

  • Students may needs to be praised as first-rate students to believe they could be first-rate students which they will eventually become

  • We lead limited lives not because we have to but because we think we have to

  • In cell biology, when cultured cells you are studying are ailing, you first look at the cell’s environment, not to the cell itself for the cause

  • Cells are made up of 4 large molecules - polysaccharides (sugars), lipids (fats), nucleic acids (DNA/RNA) and proteins. There over 100k proteins to run our bodies

  • Amino acids link up like beads or bones in the spine via peptide bonds. Charges in the Amino acids leads to folding where the bonds rotate or flex. Improperly folded proteins are destroyed and the amino acids recycled

  • The distribution of electromagnetic charge within a protein can be selectively altered by hormones

  • Human genome consists of approx. 25k genes though the expectation was of 120k genes. 80% of presumed to be required DNA doesn’t exist (A microscopic worm has 24k genes so incrementally very little in humans)

  • One gene, one protein concept was the fundamental tenet of genetic determinism

  • Fruit fly has 15k genes - 9k fewer than the primitive caenorhabditis worm (evolution doesn’t simply increase number of genes)

  • Enucleated cells (nucleus removed) can survive for 2-3 months and carry on all functions except reproducing defective parts. Nucleus is more a gonad than a brain

  • Nutrition, stress and emotions can modify genes without changing their basic blueprint

  • In the chromosome, DNA forms the core and the proteins cover it like a sleeve (when genes are covered, their information cannot be read) - this covering or uncovering is controlled by the environment

  • Cell membranes decide what to let in or not through the phospholipid membranes through receptor proteins - cells have uniquely tuned receptor proteins that respond to every environmental signal - in prokaryotes like bacteria thus the membranes act as the brain

  • Integral membrane proteins (IMPs) react not just to physical molecules but to energy as well, altering protein’s charge (signal transduction). membrane functions much like a semiconductor with gates and channels

  • Thoughts, the mind’s energy, directly influence how the physical brain controls the body’s physiology (our subconscious beliefs of our self-worth hence influence our efforts)

  • The limbic system was a mode of communication for the community of cells - our conscious mind feels this communication as “emotion”

  • The subconscious mind is reflexive and not governed by reasoning or thinking (Mlodinow’s Subliminal comes to the same conclusions)

  • The conscious mind’s ability to overcome the subconscious mind’s preprogrammed behaviors is the foundation of “freewill”

  • In histamine and adrenaline introduced into tissue cultures - adrenaline could override the locally produced histamine. Our mind thus is capable of overcoming the body to influence action (placebo effects probably works the same way)

  • Nocebo effect - negative suggestions that can damage health (similar to how placebo works). Your belief alters the biology

  • Paraphrasing Mahatma Gandhi - beliefs → thoughts → words → actions → habits → values → destiny

  • Growth and protection are a continuum - when in protective mode, growth behaviors are restricted (immune system uses up bulk of the body’s energy)

  • Stress signals suppress the slow and energy consuming conscious mind to enhance survival (When HPA axis - hypothalamus-pituitary-adrenaline is activated we cannot think clearly and are geared for a fight-or-flight response). HPA is useful in short bursts but modern personal lives keep it activated throughout, thereby stunting growth and thought

  • When your conscious mind has a belief thats contradictory to what’s in the subconscious mind, it leads to a weakening of the muscles (subtle tells in lying work this way)

  • At a younger age, brain operates in low freq. delta (0.5 - 4 cyc/sec) and theta waves (4-8 cyc/sec). This puts them a suggestible, programmable state. (Parents’ behavior and beliefs become their own during this period). Negative feedback during this period can be extremely damaging to the child in the long run

  • Beta waves (12-35 Hz) kick in around 12 years of age and are required for focused attention (like reading a book). Gamma waves (> 35 Hz) is peak performance

  • Conscious mind can think forward and backward in time while subconscious mind is always in the present. Latter handles almost 20 million environmental stimuli per second while the former handles just around 40. When not self-aware, we let the subconscious handle everything

  • We must be careful not to implant unnecessary fears and limiting behaviors in our children

We are influenced by what we believe and most of the time are limited only by what we believe. The booked helps you understand why the ceiling exists and who put it there and why it doesn’t have to exist where it does. You can see this in sports all the time where a player overcomes the imposed labels to be something else altogether (Rahane at present for eg.) - nothing has changed except a overcoming of pre-programmed beliefs. I found the book to be natural ally to Mlodinow’s Subliminal and at least one of the two must be read by everyone at some point (preferably later in life when the ceiling is reached, leading to what modern life calls “midlife crisis”). This book benefitted me more than I care to admit. 10/10

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Understanding Michael Porter by Joan Magretta

The book provides a comprehensive overview of Porter’s contributions to the field of business strategy and the impact his ideas have had on the way businesses approach competition and corporate strategy. It covers a range of topics related to Porter’s work, including his Five Forces model, Value Chain analysis, and his ideas about competitive advantage and corporate social responsibility.

My Notes :
It’s one of those books which you do not gobble like a fast food but chew slowly as a gourmet . The best part is it first provide’s you with a road map as to what the book would be talking about

Part 1 : What is Competition ?
Part 2 : What is Strategy ?

The Right Mind-Set

  • It shows that the fight is not to be the best , it is about how to be unique and make your own place in the world , marketplace whatever you are doing .
  • Competitive Advantage is when you create your own space , and be unique and competition can grow with you in place .
  • Competition if taken seriously would be counterintuitive and term for this is ‘ competitive convergence

An example to make sense of the point :

The 5 Forces
This defines the intensity of rivalry among existing competitors and determines the ind structure :

  1. The bargaining power of buyers (the industry’s customers)
  2. The bargaining power of suppliers
  3. The threat of substitutes
  4. The threat of new entrants
  5. Rivalry among Existing Competitors

Porter also mentioned that analysing a company using this methodology over SWOT analysis would give you a better edge as all of these pointers straight impacts your profit :

  • Competitive Success idea can be captured well using ROIC ( Return on Invested Capital )

ROIC weighs the profits a company generates versus all the funds invested in it, operating expenses and capital. Long-term ROIC tells you how well a company is using its resources.’ It is also, Porter points out, the only measure that matches the multidimensional nature of competition: creating value for customers, dealing with rivals, and using resources productively. ROIC integrates all three dimensions. Only if a company earns a good return can it satisfy customers in a sustainable way.

Talking all about Strategy now :

If you have a strategy, you should be able to link it directly to your P&L.

The big idea here is this: Strategy choices aim to shift relative price or relative cost in a company’s favor. Ultimately, of course, it’s the spread between the two that matters: any strategy must result in a favorable relationship between relative price and relative cost.
A distinct strategy will produce its own unique structure. One strategy might, for example, result in 20 percent higher costs but 35 percent higher price. Companies such as Apple or BMW lean in that direction.
Another strategy might lead to 10 percent lower costs and 5 percent lower price. Companies such as IKEA and Southwest have chosen this kind of structure. Where the net result of the configuration is positive, the strategy has, by definition, created competitive advantage.

What a good strategy for a business should have , try to relate these pointers with the company you hold :thought_balloon:

A good example to drill the idea is of Zara :

Think of Zara as a system perfectly designed to optimize the delivery of its distinctive value proposition. I say “optimize” because if you look at what Zara does, piece by piece, some of the choices will surprise you. Some of its choices, for example, may not seem cost effective given Zara’s low relative price positioning. Its large design team is twice the size of H&M’s, another hot European fashion retailer.
Unlike its rivals, Zara does its own manufacturing, and most of it is done in Europe, not Asia. Its stores are located in the highest-rent districts in town. None of these choices is, by itself, the “low cost” solution. But when you step back and look at the whole, as a system, you realize that Zara is willing to make a suboptimal choice in one area in order to optimize the whole.

  1. Unique Proposition : First, the role of the designers is to spot trends and copy them. Rather than pay big-name designers big bucks to create something new, the company has scouts around the world looking for the latest fashion trends at shows and in nightclubs. Its large team of in-house designers can create a new collection in under a month and can modify existing collections in a couple of weeks. The size of the team allows Zara to be a fast copier, getting those new designs into production quickly.

  2. Tailored Value Chain : Zara began not as a retailer but as a manufacturer, and true to its roots it continues to do a sizeable amount of production in-house, in Europe, and in plants configured for small-batch production. Zara owns a fleet of trucks to speed goods from its centralised logistics hubs in Spain to its stores throughout Europe in twenty four hours or less. And, again counter to industry practice, garments arrive ticketed and hung. This raises shipping costs but means the merchandise arrives ready to sell, needing no in-store ironing. Speed is the theme.

  3. Trade-off’s different from Rivals : Zara sells the latest-fashion clothes at moderate prices (not low in absolute terms, but low relative to fashion brands). Its key insight into how to deliver that particular value proposition is speed.
    The stores themselves -in prominent locations with high foot traffic are spacious. But the new goods that come twice a week

4. Fit across the value chain :

  1. Continuity over time : Everything Zara does is tailored to getting the latest styles into its stores fast. Most fashion retailers can live with lead times of three months. Zara’s are just two to four weeks, allowing it to release one hundred collections per year. This blistering pace is possible because Zara controls its value chain from end to end, and it’s choices all along the value chain are different from its rivals. Zara makes some significant trade-offs–in how it promotes its brand, how it designs its merchandise, and how it manages production, logistics, and inventory Zara’s success comes not from one choice, but from the way these many choices fit together to reinforce each other.

Ten Practical Implications

  1. Vying to be the best is an intuitive but self-destructive approach to competition.

  2. There is no honor in size or growth if those are profitless.Competition is about profits, not market share.

  3. Competitive advantage is not about beating rivals; it’s about creating unique value for customers. If you have a competitive advantage, it will show up on your P&L.

  4. A distinctive value proposition is essential for strategy. But strategy is more than marketing. If your value proposition doesn’t require a specifically tailored value chain to deliver it, it will have no strategic relevance.

  5. Don’t feel you have to “delight” every possible customer out there. The sign of a good strategy is that it deliberately makes some customers unhappy.

  6. No strategy is meaningful unless it makes clear what the organisation will not do. Making trade-offs is the linchpin that makes competitive advantage possible and sustainable.

  7. Don’t overestimate or underestimate the importance of good execution. It’s unlikely to be a source of a sustainable advantage, but without it even the most brilliant strategy will fail to produce superior performance.

  8. Good strategies depend on many choices, not one, and on the connections among them. A core competence alone will rarely produce a sustainable competitive advantage.

  9. Flexibility in the face of uncertainty may sound like a good idea, but it means that your organisation will never stand for anything or become good at anything. Too much change can be just as disastrous for strategy as too little.

  10. Committing to a strategy does not require heroic predictions about the future. Making that commitment actually improves your ability to innovate and to adapt to turbulence.

This is one of those books which I feel needs to be revisited time to time , because as your situation changes in life it can give you a different perspective . Just rating it on my personal opinion as a 8/10 ! Thanks for the read , Hope this added some value for you today :smiley:

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Excellent summarization! Intriguing read for a weekend.
Is there any mention of maximization of gamma waves or increasing the tenure of it.
At what age beta waves kick in ?

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How to take Smart Notes, Sonke Ahrens, 2017 - This was a small but powerful read and I would highly recommend it for anyone who reads a lot, or is into academics or dreams of writing a book. It helps to understand the importance of putting what you read in your own words. Writing essentially becomes the medium in which you think. I have personally benefitted a lot from taking notes, writing and making connections across different disciplines so I highly endorse this approach

My notes -

  • Every intellectual endeavor starts with a note

  • Writing is the medium. You don’t write after learning, studying or research - you write while doing it

  • Writing doesn’t start with a blank page - writing starts with notes collected on the subject you want to write about

  • Willpower is a limited resource that depletes quickly - self-discipline or self-control is not that easy to achieve with willpower alone

  • Nobody needs willpower to not eat a chocolate bar that isn’t around. Willpower isn’t needed to do something you would have loved to do anyway

  • When tasks are interesting, meaningful and well-defined and so there isn’t any conflict between long-term and short-term interests, willpower isn’t necessary

  • Not having willpower but not having to use willpower indicates you have set yourself up for success

  • A good structure (workflow) allows you to not force yourself to do anything you dont like. When stuck, you simply do something else. A good structure enables flow where you lose track of time

  • Taking notes is not just about collecting thoughts but about making connections and sparking new ideas (i can’t agree more)

  • GTD - Getting Things Done (Allen) - idea is to collect everything you need in one place and then work on it. All thinking is already done in the notes gathered, so your working memory is free without competing thoughts and you experience a “mind like water”

  • The slipbox - You gather notes in a slipbox - one idea, one note but with varied contexts (categories) with links between notes. This way the notes together are worth more than their sum-of-the-parts (Luhmann method)

  • Notes build up while you think, read, understand and generate - writing is the best facilitator for thinking, learning, understanding and generating ideas

  • Fleeting notes, literature notes and permanent notes (former two have to be converted to this periodically)

  • Write notes as if you are writing for someone else (Reason why I do these book summaries - I am writing for myself in the future - that’s not me but a diff person)

  • Don’t cling to an idea if another more promising one gains momentum (Applies to so many things)

  • Accidental encounters make up the majority what we learn

  • Author recommends using Zotero and Zettelkasten (I feel good old Keep/Evernote/Notion do the job just as well)

  • Many people had idea for shipping container but it didn’t pick up until the self-reinforcing positive feedback loop took over - harbours that could handle containers, more container ships, cheaper shipping, more goods shipped, economical ships, more infra and so on

  • The slipbox is the shipping container of the academic world - single storage type for different ideas

  • Without a permanent reservoir of ideas, you will not be able to develop major ideas over a long period of time due to capacity of memory

  • Writing is not a linear process but a circular one

  • The more connected information we have, the easier it is to learn as new information can dock to that information (latticework of mental models!)

  • Experience is internalising knowledge so decisions don’t have to be consciously thought - they come from the gut via intuition (can’t agree more)

  • Letting thoughts linger while not focusing - say while walking or showering allows brain to be surprisingly productive as it plays around with the last unsolved problem it came across (all my profound thoughts have come to me in the shower, while walking or upon waking)

  • Willpower depletes quickly and needs time to recover - ego depletion - temporary loss of volition due to prior exercise of volition

  • Gates and Obama wear only two suit colors - this means one less decision to make in the morning, leaving more resources for decisions that matter

  • Writing simplifies the understanding and spills over into thinking and also speaking in simple sentences

  • Re-reading or underlining sentences for reading again is ineffectual (like going to the gym to work out with the least effort possible). Writing in your own words is the key (I realised it bit late)

  • Highlights to notes generated by e-reader devices are like fast-food. Neither nutritious nor very enjoyable - just convenient

  • Our perception does not see first to interpret next - it does both at the same time

  • Like martial arts (judo) - when you encounter resistance, you do not push against it but deflect it towards another productive goal

  • Work expands to fit the time we allocate for it, like how air fills very corner of the room (Parkinson, 1957)

  • It doesn’t help to imagine ourselves as winners of a race but to imagine all the efforts, trailing and tools required to win

This is a quick read and since the concept could fit in a blog post, the author draws from different ideas to support the concept in book form. It doesn’t feel like a drag though its a little repetitive since the size of the book is so small. Would recommend to anyone who doesn’t yet write their own notes. The ones that do probably already know the value of doing so. 9/10

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Digital Minimalism, Cal Newport, 2019 - I was very concerned about my Twitter usage so read this book a few months back. It is quite useful and has reduced my mindless scrolling dramatically as I now pursue it with intention for limited time. The idea behind the book though isn’t new. It is one of those things most of us know but can’t do. Deliberate practice can only come with intention so I recommend reading this book. Acknowledging that you have a problem (if you do) is the first step towards digital declutter and digital minimalism.

My notes -

  • The urge to check twitter or other social media shatters time into small useless fragments for focused work

  • Endless stream of information has made us into (mostly useless) information addicts

  • Being connected to friends on facebook renders us useless in maintaining F2F conversations

  • Portrayals of perfect lives of SM leads to lives lived with feelings of inadequacy

  • Online discussions lead to emotionally charged and draining extremes.

  • Darker emotions attract eyeballs than positive and constructive thoughts in attention marketplace

  • A moment can feel strangely flat if it exists solely in itself (A moment not shared on SM)

  • We have been coerced to use screens more than it is healthy - billions have been invested to make this outcome inevitable

  • Checking your “likes” is the new smoking (Philip Morris just wanted your lungs, the screen wants your soul)

  • Every time you check your phone you are playing a slot machine to see “What did I get?”

  • Addiction - substance or behavior that provides reward despite detrimental consequences. Behavioral addictions (pathological gambling and internet addiction) resemble substance abuse

  • Tech companies engage in intermittent positive reinforcement / variable rewards (unpredictable rewards release more dopamine) and the drive for social approval (Every SM post is a gamble for likes or RTs)

  • Paleolithic man needed a carefully cultivated social standing and approval as his survival depended on it. Behavioral addictions have hijacked this primitive behavior for approval / survival

  • Paleolithic brain equates not reading a newly arrived notification as snubbing a tribe member

  • Digital declutter - step away from optional (what won’t disrupt your daily personal and professional life when removed) online activities for 30 days and cultivate high-quality leisure (long-term meaning over short-term satisfaction)

  • Digital minimalism - Focus your online time on small number of carefully selected and optimized activities that strongly support things you value and happily miss out on everything else

  • Post digital declutter, be intentional about what technologies you choose to use (only what you deeply value) and have a specific time in which to use them (once a day for 10 mins for eg.)

  • Thoreau’s new economics (read Walden if you haven’t yet) - shifting unit of measure from money to time. If ploughing 1 field gives you $1 and ploughing 60 gives $60, standard economic theory would urge you to maximise - Thoreau on the other hand asks if the effort is worth it physically, mentally (cost in life required to achieve it) and if the better blinds on the window you can buy with the profits is really worth it

  • Standard economic theory would say Twitter is good for the occasional real benefit you might achieve but Thoreau’s new economics would measure that profit against “your life” (the cost)

  • The cumulative cost of the noncrucial things we clutter our lives with can far outweigh the small benefits each individual piece of clutter promises (law of diminishing returns)

  • Compulsive phone use papers over a void created by the lack of a well-developed leisure life

  • Solitude is an agreeable refreshment to the busy mind - Benjamin Franklin (Cultivate solitude - lose loneliness in solitude, generate new ideas and a better understanding of self in solitude)

  • We have a great haste to construct a magnetic telegraph from Maine to Texas, but Maine and Texas, it may be, have nothing important to communicate (Thoreau)

  • Avg. smartphone user spends 3 hours a day using it - while picking it up 40 times per day!

  • Solitude has been banished from daily experience with the smart phone

  • The idea that its valuable to maintain vast number of weak-tie social connections (followers) is largely an invention of the past decade

  • Prioritize demanding activity (learn new skills) over passive consumption (cultivating high-quality leisure)

  • Use skills to produce valuable things in the physical world (leave good evidence of yourself)

The book should have been a blog and doesn’t deserve to be 240 pages long. A lot of it is repetitive but if your idea is to fix yourself, its ignorable. It is filled with actionable ideas on cultivating high-quality leisure (meeting friends, building things, picking up new skills - carpentry, guitar what not) and on how to approach digital minimalism in the initial 2-3 chapters. It will force you to think through how you spend your time on a daily/weekly basis. 8/10

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The Shipping Man, Matthew McCleery, 2011 - I love books that teach me about a new industry. This one on shipping is among the best of those since it assumes nothing of the reader and yet is filled with so much about the industry conveyed in the most humorous way. Also, one of the most hilarious books I have read as well, as I had tears laughing in several parts. The story is fictional - of a hedge-fund manager who gets sucked into buying a ship and his encounters with the colorful characters of the shipping industry, from Greek and Norwegian shipping men, German and English financiers, Somali pirates and Wall-street bankers

My notes -

  • Three types of ships - Bulk carrier (unpackaged dry bulk), container and tanker (transport and store oil)

  • BDI - Baltic Dry Index - measures the time charter rates paid by the dry bulk cargo ships (fluctuates wildly - like ATH to 25 yr low in 3 months sort of wild)

  • When it comes to buying ships, the best deals come with the worst cash flow - you generally don’t get a good price and good cash flow at the same time (applies to all cyclicals)

  • TEU - twenty-foot equivalent unit (Measure of capacity of containers the vessel can hold)

  • Intermodal - The transport system where same boxes (containers) can be loaded off ships, into trucks or trains

  • Three advantages to compete in shipping - pay less for your ships, pay less to operate them or pay less for your capital (applicable widely!)

  • International shipping markets closely mirror general economic and political events - but on steroids (China joining WTO in 2002 resulted in large shortage of ships - anyone who owned a ship became rich overnight)

  • Even tripling of charter rates doesn’t destruct demand as large volume transport ensures margin increase per item is low - add in financial leverage and operating leverage and effect is potent

  • New ships take 18 months to build. Since most orders are placed at top of cycle, value destruction is wild

  • Germans were largest low-cost lenders in shipping industry and they mostly lend to container ships (Hamburg controlled 35% of global container fleet)

  • Liquidity is nothing more than a function of finding a market clearing price. At the right price, there is endless liquidity

  • A ship worth $56m in 2007 purchased on a loan of $43 million (73% of market value) was worth $25 million in 2009 if you could find a buyer at that price (Lenders to the industry know this sort of thing is like a common-cold and it will pass. So banker might waive payments and ship owner might retain his equity - the stress is only in the imagination - so no assets are sold for cheap at the bottom of the cycle)

  • While loan value might be higher than market value of ship - the value of undiscounted cash flow the ship can generate in the next 27 years make the loan sound - keen understanding of this leads to banker and owner retaining their sanity

  • When there is stress in the economy, they work as a team to ensure everyone survives and don’t cry “every man for himself” and jump ship (way Europe does business vs America)

  • Amend and extend (or pretend and extend) or kicking the can down the road is a legit strategy is shipping loans (Even when the loan is stressed and must be cleaned up, its sold at face value even when collateral is worth half-price to another known borrower who brings in the working capital and a non-recourse loan is provided to the borrower to buy the loan)

  • When charter rates aren’t enough to pay operating expenses, lot of working capital loans are required to survive

  • Lender raises money for giving out working capital loans at 8% (DIP or debter-in-possession financing) to ensure they tide over the bad phase so they have keep the equity upside for themselves since they assume the equity risk

  • Greeks are some of the most hardworking and clever shipping people in the world (Intense rivalry between Greece, Norway and China)

  • Shipping is a big industry but a small community and information is everything - like living in a little village

  • Everyone knows everyone and everything so you must be careful not to run a stop sign or be seen parked in your neighbor’s driveway (On trust and accountability in shipping)

  • If your cost of capital is higher than Germany - naturally you will end up doing the worst deals every time (banking in general works this way)

  • The experts are often wrong because they know too much about a market thats inherently unknowable

  • One who is most bullish, has lowest cost of capital and a personal motivation for doing a deal wins the ship - everyone else does nothing but talk about the rational reasons they have for not doing deals (Applies to many markets)

  • No shortage of money to shipping industry - govt.s, oil companies, grain houses, traders, shipowners, PE funds, capital markets - only time will tell if you make a good deal in shipping

  • Money is a commodity just like ships and cargo. Even the broke have money for a good deal - money hides where there’s danger and pops up where there’s value - money drives away value

  • If you order a ship you will have dead money for 18 months

  • As a shipowner you think the ship will work for you but in reality, you will work for the ship (On a philosophical level, all possessions work this way!)

  • Vintage ships - or seasoned assets - the ones without new ship debt amortization schedule are good way to making money in shipping - sweating the assets bought for cheap

  • The value of a ship is determined by “perceived” cash flow it will generate. Even when BDI crashes 97%, it has to stay at the level for long time before it erodes confidence

  • Replacement parts for old ships are available in scrapyards of India and Bangladesh

  • A new ship may cost $30 million and an old one $4 million - but they earn the same charter rate

  • An old ship that costs $4 million may generate $14,000/day and have operating exp. of $4,000/day giving an FCF of $10,000/day - $3.65 million / yr - returning back investment in a year, assuming charter rates stay same and 100% util (If lucky it can even generate $60,000/day on a 60 day voyage and post expenses, do that much in a single voyage!)

  • A ship is like a little factory - you may have to go 30 days to collect charter hire but have to pay all of your expenses (A $4 million ship will still need $1 million in working capital - mainly for bunkers - which is fuel)

  • Adcom - or address commissions - like broker fees or illegal fees to do the deal at lower value (like our black money)

  • Supply and demand alone doesn’t affect freight rates - while moving cargo has an intrinsic value, the cost of it is determined by perception of the direction of freight rates (Putin banning export of Russian grains for eg. might imply grains moving from US/Canada to Middle-east - so further the distance, higher the ton-miles, which increases freight-rates - and it happens in span of hours)

  • Shipping is often best when the world is least stable (as it happened post Covid)

  • Shipping wasn’t regulated by one authority, it was regulated by a seemingly endless stream of them

  • Tankers could earn $5m in profit for carrying 2 million barrels from Saudi to Japan in good market but could lose half as much when market was bad

  • The shipping news, Death of a shipowner, Maritime Economics, Ship finance : credit expansion & boom-bust cycles (Books on the industry)

  • FOB - freight-on-board - all costs borne by the shipper before cargo passes through ship’s rail. CNF - Cost-and-freight - incl. of shipping cost to nearest port of buyer

  • Avg. charter rates are probably in line with expected return on capital but fortunes were made and lost in the short-term market on the whipsaws of charter rates

  • CNF can lead to serious haemorrhaging of cash when freight rates are high (as it happened post Covid). By owning a ship, financial risk is exchanged for operating risk (buying old bulk carriers)

  • In shipping, you have to be well-capitalised since unexpected happens every day. Enough cash buys time

  • Greatest value in shipping is option value - so entering long-term charters at fixed rates is not only boring but also ends up losing this option value

  • Someone is often wrong and its most often the guy who (thinks he) knows the most

  • The two happiest days in a shipowner’s life are the day he buys a ship and the one when he sells it for a profit :slight_smile:

  • Growth is a principle preached by people who have nothing of their own to lose - govts. want growth to keep their ponzi going through tax revenue, people with nothing need growth to get something, and people who feel small think they need growth to feel big

  • In shipping its better to own 100% of 10 ships than 50% of 20 ships where you have to beg your board for permission to buy, sell, charter or pay yourself a little dividend

  • There are no economies of scale in shipping beyond a fleet of 10 ships. The guy owning 70 ships simply overpaid for 35 of them so had to double down to reduce avg. price of ships (lol)

  • If my ship saved your ship from Somali pirates, maritime law requires you to pay me 50% of the value of your vessel

  • Venezuelan crude - darkest and dirtiest crude in the world with carbon chain so long that stuff is barely flammable - only the Chinese want it and they burn it in their power plants

  • Cornerstone investor - a smart, well-known fund manager that people know will do his homework before making a substantial investment (others will then piggy-back)

  • An investment banker is no banker at all as they are not a lender, nor an investor - they are merely a broker and should be called so

  • Buy on the sound of cannons and sell on the sound of trumpets - Napoleon

  • Thou shalt not believe a single word thy investment banker uttereth

  • Higher the promised coupon, less likely the company is to pay it (coupon rate doesn’t matter to the investment banker - their fee is same irrespective of deal prices)

  • Reverse hollywood accounting - when studios pay actors a percentage of the net, they would cook the books to make sure the net was close to zero (horseplay between the revenue line and net income line)

  • Junk bonds or high-yield bonds raise more than they require - usually double (investment bankers insists on this) and 50% of the amount is locked up in escrow for payment of coupons (credit enhancement is the fancy term used)

  • Nothing got an investor aroused as much as the possibility that he might be denied the opportunity to make the investment

  • VLCC - Very large crude carrier. In good times also Very large cash cow :slight_smile:

  • Historical financials and book values - two things American investors look for - both mean nothing in shipping industry

  • When Egypt shuts the Suez, navigating around the horn of Africa means VLCC rates can go from $5000 / day to $150,000 / day (Suez blockage post Covid led to same outcome)

  • Equity capital with a fixed coupon - if deal works out, you buy the investors out. If the deal doesn’t work out, you buy them out for cheaper

  • Earning money is more fun than just having money

  • Success in life is basically random and a function of having the willingness to try new things

The notes don’t do justice to the book and I highly recommend reading the book if you want to understand shipping and would at some point like to own businesses in this sector like GE shipping or SCI (Disc: dont own either). Even otherwise, it gives a good idea of the perils of globalisation when so much of goods are moved on the waters several thousands miles. You also get a good idea of the functioning of shipping finance and investment banking industry in the most lucid and hilarious fashion possible. 11/10

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The Little Book of Valuation, Aswath Damodaran, 2011 - If there’s one book that has taught me the most about the markets, it is this one. There isn’t anything else as lucid, well structured and also exhaustive while being so concise and precise. It covers everything from the basic precepts of valuation, different types of cash flows, different types of valuation, valuing growth companies, mature companies, startups and dying businesses and special situations all the while keeping to the coherent whole of what drives intrinsic value of something, where does uncertainty and risk come from and how to discount for it

My notes -

  • One who knows the price of everything but the value of nothing - Oscar Wilde

  • Price of a stock cannot be justified by just using the argument that there will be other investors who will be willing to pay a higher price in the future

  • Assets with high and stable cash flows should be worth more than ones with low and volatile cash flows - Intuition - You will be willing to pay higher for a property with higher and increasing rents than to a property with lower rents and variable vacancy rates

  • Most assets are valued on a relative basis than based on intrinsic value (what’s another house in the same neighborhood worth?)

  • Intrinsic value provides full picture but relative valuation is also a realistic estimate of value - find the middle-ground or find stocks undervalued on both to increase odds

  • All valuations are biased - bias starts with companies chosen to be valued, continues with management inputs that put best spin, institutional factors (analysts want to maintain cordial relations with company), predisposition (see less risk to higher growth rates for businesses you like), post-valuation garnishing (adding premiums to synergy, management quality etc.) - more bias, less accuracy

  • Confine your research to information sources (financial statements), rather than opinion sources (analyst reports)

  • Most valuations are wrong due to information sources, estimation errors and firm-specific uncertainty (young growth companies specially)

  • Value an asset with the simplest possible model (dont be misled by computational power and informational abundance)

  • Success in investing comes not from being right but by being wrong less often

  • Present value - how much is a dollar in the future worth today? The adjustment factor is simply the discount rate (If $100 next year is worth $80 today to you, your discount rate is 20%)

  • Why discount? 1. Consumption today vs tomorrow 2. Inflation 3. Uncertainty in the promise to delivery value in the future (Note how subjective, rather than objective these are)

  • Five types of cash flows - simple cash flows, annuities, growing annuities, perpetuities, and growing perpetuities

  • Simple cash flow - Cash flow in future / (1 + Discount rate)^Time Period. Say you are to receive $1000 in 10 yrs its value will be - 1000/(1+0.08)^10 = $463.19 ($500.25 if 9 yrs, $857.34 after 2 yrs, $926 after a year and so on). Intuition - Longer the period, lesser your willingness to wait and higher the uncertainty and so lesser the value - notice how for 10 yrs at 8% discount rate, the value is less than half of actual cash flow at 8%. What happens when you discount at 15%? Its worth only $247 today vs $463 at 8%! (This follows the exponential discounting curve - as part of intuition get this curve into your head so you can discount at 8% vs 12% vs 15% intuitively)

  • Annuity - Constant cash flow in regular interval for a fixed time period - Say you receive $1000 every year for 10 yrs - You can discount them for each year as in simple cash flow above and add them up - or you can use the formula Annual Cash flow ( (1 - (1/ (1 + Discount Rate)^ Time Period )) / Discount Rate ). Say a $3000 cash flow every year for 5 yrs will be worth $10,814 today, discounted at 12% - see how its 3.6x instead of 5x annual cash flow (Summing up present value of individual cash flows for 5 separate years is more intuitive than the formula). If done for 10 yrs, the value is $16950 or ~6x (The low P/E for businesses without growth in terminal industries should be intuitive now)

  • Growing Annuity - Grows at a constant rate for a specific period of time. A gold mine that generates $1.5m in current year and expected to grow at 3% a year, for next 20 years, discounted at 10% will have a present value of $16.15m (or roughly 10x current year earnings). A growth of 10%, discounted at 15% will be ~20x earnings. Formula is straight-forward to look-up but a year-wise cashflow discounted back and added provides the intuition to the sensitivity to growth and discount rates (Plugging in g=0 in this formula makes it same as Annuity of course)

  • Perpetuity - A constant cash flow at regular intervals forever (console bonds). Calculated as Cash flow / discount rate A $60 every year till perpetuity, discounted at 9% is $60/0.09 will have a value of $667. This can be very unintuitive that something that pays till perpetuity has such a finite value and that too at just 11x yearly cash flow. Intuition - That’s how less cash-flows far into the future are worth that it tapers down drastically and adds up to a finite value

  • Growing Perpetuity - A cash flow that’s expected to grow at a constant rate, forever. Calculated as Cash flow / (discount rate - growth rate). Note how growth rate has to be lower than discount rate. Also this growth rate has to be lower than the growth rate of the economy (remember this is perpetual growth). Also note how growth rate being 0 in this formula simply makes this same as present value of a perpetuity above. The formula is also exact same as the one we use in Dividend discount model - like a $2 dividend this year, expected to grow at 2% a year, discounted at 8% will give us $2 / (0.08 - 0.02) will give us the value of share as $34. Can also be used to calculate value of a property with rent

  • The price of risk affects value. (Risk isn’t beta and CAPM isn’t the right way to model risk IMO)

  • Goodwill is the most common intangible asset that rises mostly from acquisition - price paid over and above price of assets is recorded as Goodwill - when value of target company drops, this goodwill is decreased or impaired

  • Accrual accounting - Revenue is recognised in the period in which good is sold or service is performed (cash comes later)

  • Operating, financial and capital expenses - Operating provide benefits only in the current period. Financial - interest cost. Capital - benefits over multiple periods. Netting operating expenses and depreciation yields operating income. Post interest and taxes, the net income

  • Post tax RoCE = Operating Income (1 - tax rate) / BV of debt + BV of equity - Cash. RoE = Net Income / BV of equity

  • Financial Balance Sheet - Reflects fair-value accounting. Value of business is value of current assets already invested (at fair-value) and value of growth assets (what’s to be invested in the future)

  • Valuation can be done be valuing entire business and subtracting the debt or valuing the equity directly based on net income and adjusting for risk. Ideally both should yield similar value

  • Dividends would be a good way to calculate value but unfortunately not all businesses pay dividends, so judging the potential for dividend or free cash flow to equity (FCFE) is one way to go about it (I think this is absurd since it includes net debt issued in FCFE or potential dividend)

  • Buffett uses FCFF or free-cash flow to firm which ignores the debt issues and uses owner’s earnings adjusted for capital and working capital expenditures (One I personally use)

  • Discount rates are lower for stable cash flows and higher for volatile ones. When valuing equity, risk is part of business operations as well as in use of debt. Debt investors will have to look at the cash flows (operating income to interest or interest coverage ratio) and default risk - cost of equity and cost of debt and cost of capital to firm varies accordingly (again, the intuition more important than formulas)

  • Relationship between past and future growth for most companies is a weak one. Neither managers, nor analysts can be objective about the future.

  • A firm can grow by managing its existing investments better (efficiency) or make new investments (capex)

  • While valuing a firm, value cash flows at a reasonable time period (say 10 yrs for most businesses or 20 yrs for some) and work on terminal value - estimated by liquidation value or a going concern value (valued as a perpetuity with same cash flow as nth year or with small growth rate and appropriate discount rate)

  • If your est of fair value disagrees with the market, 1. your assumptions could be wrong 2. your risk premiums could be off 3. market is valuing business incorrectly - #3 is rare and should be treated as such. It is no guarantee that market will agree with you in the near future (cheap can get cheaper)

  • Relative valuation can be done more quickly and with less information and is most often used. Comparing P/E or P/B or EV/EBITDA across companies or across time for same company while accounting for differences qualitatively - these multiples are easy to use and also easy to misuse, so exercise caution

  • Relative valuations have short shelf life as market perceptions of risk vary wildly across time. For eg. lower interest rates 5 yrs back could have led to higher P/E multiples which may not apply anymore

  • Key determinants of P/E - 1. Expected growth rate 2. Cost of equity 3. Payout ratio (Value of Equity = Expected Dividends / (Cost of Equity - Expected growth rate) and P/E = Value of Equity / Net Income which is nothing but Dividend Payout Ratio / (Cost of Equity - Expected Growth Rate)). All else remaining same, higher growth, lower risk and higher payout ratio firms will trade at higher P/E ratios (All market movement boils down to these 3 in some way if you think about it deeply)

  • Key determinants of P/B - In addition to determinants of P/E, RoE also affects P/B (P/B = Value of Equity / BV of Equity = RoE * P/E. Looking at P/B as RoE x P/E is a tremendously useful way of thinking).

  • Typical valuation mismatches - 1. Low P/E coupled with higher expected growth rate 2. Low P/B coupled with higher trending RoE 3. Low P/S with increasing net margin 4. Low EV/EBITDA with lower re-investment needs (This was the key takeaway for me from this book in 2017 and the one I have benefitted from the most)

  • In young idea companies without cash flows, we often rely on compelling stories to justify investment decisions - instead focus on 1. Big potential market 2. Expense tracking and controls 3. Access to capital 4. Key-man risk 5. Exclusivity - So tough-to-imitate products, with a large potential market, keeping expenses under control and great access to capital get valued higher

  • Growth firms get more of their value from investments they expect to make in the future and less from ones already made

  • Quality of growth - measured in terms of excess returns - returns on the assets relative to the cost of capital

  • A company that has posted 80% growth for last 5 yrs is now 18x its size and is unlikely to grow at that rate - growth crimps growth by attracting competition (or market shrinks)

  • Level of growth affects value, as does the length of growth period and the excess returns that accompany that growth rate (Larger potential markets with less aggressive competition and better management can maintain high revenue growth for longer periods)

  • As firms grow large, they have to diversify their product offerings for wider customer base to continue growth - focus on managements that enable this

  • Mature companies - 1. Revenue growth approaching growth rate of economy 2. Margins are stable 3. Competitive advantages may be squandered (Nokia) or retained (Coca-cola) 4. Have good debt-servicing capability but not many avenues for growth 5. Generate more cash from ops. than they need which must be paid out or they will accumulate in balance sheet 6. Sometimes grow by acquisitions as growth stagnates and cash grows (could be often value-destructive)

  • Mature companies may increase value by changes in operations, changes in financial structure or changes in non-operating assets (cash and marketable securities)

  • Since interest expenses are tax deductible while cash flows to equity are not, debt becomes attractive when marginal tax rate rises (never thought of this before)

  • As debt increases, so does the probability of bankruptcy and along with the cost of bankruptcy - aside from legal fees and court costs, your customers may stop buying your products and your suppliers may expect payments upfront and your employees abandon ship (Classic case with Vodafone)

  • Changing mix of debt and equity and also type of debt can change value

  • Value of management change = Optimal value - status quo values (Estimate value assuming management changes vs stays same - Classic case is Zee Ent at present or CG Power in the recent past)

  • In declining companies, book values can be eroded with continued operations (Suzlon for eg. in the past)

  • Most declining and distressed firms dont make it back to health

  • Key metric in valuing banks is not dividends, earnings or expected growth but what it will earn as RoE in the long-term

  • Banks with regulatory capital shortfalls should be valued less than ones that have safety buffers, since the former will have to reinvest more to get the capital ratios back up

  • P/B for financial firms will vary based on growth rate, payout, lower cost of equity and higher returns on equity with RoE being the dominant variable (Risk matters too, higher leverage, lower the P/B)

  • Valuing cyclicals & commodity companies - 1. Absolute avg. over time (Mean reversion in revenues) 2. Relative avg over time (Mean reversion in margins) 3. Sector averages 4. Firm’s value at normalised value of underlying commodity 5. Option value of unutilised resources (say mines or oil resources)

  • Intangible assets - human capital, technology, brand, loyalty of workforce. Accounting for these isn’t consistent as in physical assets. For eg. R&D is expensed due to uncertainty of future revenues in current year though there may be benefits in future - this can understate earnings (Tech startups with large TAM spend a lot on brands upfront which is expensed as well and is similar - must consider value carefully instead of looking only at PnL)

  • 10 Rules for the road 1. Abandon models but dont budge on first principles 2. Don’t let market determine what you do 3. Risk affects value 4. Growth is not free and is not always value-accretive 5. All good things comes to an end, incl. growth 6. Consider truncation risk 7. Look at past but think about future 8. An avg. is better than a single number 9. Accept uncertainty and deal with it 10. Convert narratives to numbers

You dont have to read this book so you can learn to do DCF. That is not the objective of this book though I feel it is mostly misunderstood as such. You have to understand the machinery that is a business, understand the various parts and their interaction, the design, the problems that might arise and its fixes and the way in which it can be efficiently run by its operator. To develop the intuition of what something is worth quickly is the most invaluable skill we can have. This book or his lecture are great places to start and having read Graham and John Burr Williams, I can safely say this is the easiest and most practical of the lot. 11/10

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Started with his lectures. Thanks for the link

Speculation as a Fine Art, Dickson G. Watts, 1880 - This books precedes even Jesse Livermore and probably even inspired him. Speculation is as old as the hills and nothing much has changed in centuries since Cardano although what we speculate on and how we do it has changed over the years. This is a very tiny book - like finish in an hour or two sort of short, even for an extremely slow reader like me. In terms of content though, its filled with several gems.

My notes -

  • Speculation and gambling - former presupposes intellectual effort, some calculation, some reason while the latter is blind chance, but also involving some reason and some calculation - like wit and humour, its a spectrum

  • Those who make for themselves an infallible plan are deluding themselves and others

  • Essential qualities of a speculator - self-reliance, judgement, courage, prudence, pliability

  • A man cannot have another man’s ideas any more than he can have another man’s soul or body (self-reliance)

  • Prudence - Measuring danger with a certain alertness and watchfulness

  • Prudence and courage must be balanced. Prudence in contemplation, courage in execution - promptness should connect the two - the mind convinced, the act should follow (I think of this as being patient yet nimble - two contrary, yet complementing characteristics in speculation)

  • Pliability - the ability to revise or change an opinion. He who observes, and observes again, is always formidable (Emerson)

  • The 5 qualities should be balanced - any deficiency or surplus of one quality can destroy the effectiveness of all. Hence, many fail and very few succeed

  • To take an interest larger than the capital justifies is to invite disaster (don’t overtrade)

  • Never completely reverse a position on a whim (Long to short or vice-versa). Judgements should be made moderately, cautiously, clearly

  • Run quickly, or not at all (If you are going to panic, panic early as Taleb says)

  • When doubtful of position size being large, sell down to a sleeping point

  • It is better to average up than down as a speculator. To average down, do it in small amounts over long periods and be determined to hold over a long period (investing)

  • Stop losses and let profits run. Not to have courage to accept a loss, and to be too eager to take a profit is fatal

  • Too much company is as dangerous as going against the market

  • Quiet, weak markets are good markets to sell. They develop into declining markets. When decline becomes panic, its time to buy. Sell into excitement with great confidence

  • It is better to act on general than special information

  • When in doubt, do nothing. Don’t enter on half convictions

  • Act so as to keep the mind clear, its judgement trustworthy (avoid greed and fear)

  • A fault recognized is half-conquered

  • Fools try to prove they are right. Wise men try to find when they are wrong

  • Who says least, suggests the most

  • All see, few observe

  • Common sense is sense men have in common (interesting take - so its relative & not absolute / rational?)

  • Look before you leap, but not when you leap

  • The greatest tolerance is to tolerate the intolerant

  • Respect your limitation and your limitations will respect you

  • Put on the brakes in middle life, or the momentum of youth will destroy you

  • The man who knows it all, has much to learn

  • Genius consists of seeing instantly the vital point

  • The more points of view, the better the point of view

  • Morals & money - alone a great power, together omnipotent

  • At 30, most men are in a condition of arrested development (few grow till the grave)

  • In youth, a man forges the chains that bind him in old age (i had chains and things by bb king playing in my head)

  • Acquire a habit and a habit has acquired you

  • A man who does not change his mind has little mind to change

  • Many a slip between the cup and the lip, but only one between the cup and the floor (ruin?)

  • Never explain. Let your life be the explanation

  • Wisdom consists of seeing many things and concentrating on one thing

  • Teach by suggestion, rather than instruction

  • Two kinds of vision - to see things as we see them. to see things as others see them

  • Argument is an effort of each man to force his idea onto another. discussion, an effort to gain knowledge

  • Man begins in simplicity, advances to complexity, returns to simplicity. Society follows the same course (he felt it complex in 1880, it has only gotten more so since)

  • Bragging is an expensive luxury to indulge in

  • Man must reduce his physical wants to a minimum and spiritual powers to the maximum

  • Opportunities are always there, but the opportunist is lacking

  • Stubborn men dont live for long financially

  • Your impulses are often a higher reason (thinking from the gut)

  • Man who thinks quick and right, has the world on a sling

  • The more hindsight, the better foresight

  • Money adds nothing to an extraordinary man but is a saving grace to the ordinary

  • The little man demands to be understood, the great man is content to be misunderstood

  • The hobgoblin of society - “what people will say” (Incidentally read “what do you care what other people think” by Feynman right before this book)

  • Man seeks society because he can’t endure his own companionship

The book covers not just speculation but has thoughts on life and business as well which are very insightful. Some of the terminology in the book is still used unchanged - like averaging down, stop loss, letting profits run etc. and were so ahead of its time. This is like a little book of aphorisms, or as I was thinking of it, tweets of a very wise man from 1880. 9/10

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Where do you find these books! Fascinating. Also interesting to see how the usage of the term “pliable” has changed in a century. It’s so much more a negative term now.

As always, thanks for sharing.

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