Ray Dalio in 2000, on the history of predicting the future:
"most people who experienced consistent reinforcement for 10 years were inclined to believe that this would continue indefinitely"
"At the end of the 60’s I remember most believed that managing an economy is like managing most things, we get better at it with time; it is why we could expect even lower volatility in the future.
This view was held just prior to the one of the most volatile decades ever."
"I feel my understanding of the world economy is reasonably intimate going back to the 1920’s, meaning that I believe that I have both an intellectual and visceral sense of what they were like."
"I have learned that dramatic change is the norm and to doubt the new era theories."
"As the fifties began, American psychology could be described as cautiously confident -- cautious because that was the instinct created by twenty years of depression and war, and confident because the United States was indisputably the most powerful nation on earth."
"In the sixties, Americans lost their cautiousness and kept their confidence"
"Americans believed that the economy could be turned into a sort of perpetual wealth machine."
"Going into the long bear market overinvested because of their tendency to extrapolate the past."
"Early in the 1970’s, Americans had never experienced inflation so they weren’t wary of it.
By the end of the decade, they were traumatized by it and assumed that it would never go away."
"Thirty years of prosperity and peace created a faith that our problems will be resolved."
"The eighties were almost exactly opposite the 1970’s as inflation hedge assets fell while financial assets rose, and the trade-off between growth and inflation that no one doubted, ceased to exist."
"to me the 1990s have been most like the 1920s"
"Stocks were great investments with broad ownership at the end of both decades.
There was unbounded optimism concerning the future and how easy it is to get rich by speculating in the market or working for new technology firms."
Nifty chart of Russian credit spreads around its debt default.
"Putin is a political unknown. He is 47 and truthfully has more experience as a technocrat than a politician."
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For the history nerds: the American Archive of Public Broadcasting has old episodes of Louis Rukeyser's Wall Street Week.
As I understand, watching the video is only possible with a US IP address. americanarchive.org/special_collec…
Jeff Bezos on decision making:
If a decision is consequential and (nearly) irreversible: analyze carefully, wait to get more information.
If the decision can be reversed or is inconsequential: decide quickly and don't let it kill your momentum. s2.q4cdn.com/299287126/file…
I tell myself as I agonize for weeks about a new logo or changing my avatar
"The biggest risk to irreversible decisions is deciding before you need to. The biggest risk to reversible ones is waiting until the last minute.
Make reversible decisions as soon as possible and irreversible decisions as late as possible." @ShaneAParrish fs.blog/2018/04/revers…
"After losing 80% of his net worth in the '29 crash, he “switched from market timer to value investor, seeking to profit from swings in the market rather than participating in them.”
Focus on intrinsic value (projected earnings)
Margin of safety
Think for yourself and be contrarian if necessary
"Steadfast holding" to limit transaction costs
Concentrate in a few great companies
Right temperament, balancing “equanimity and patience” with decisiveness.
"During his 25 years running the King’s College endowment, he generated an annual return of 16%, adapting his investment style to flourish even during the Great Depression and World War II."
This was me, one year ago. After years in allocator seats, I joined a friend who was spinning out to set up his own fund. Strong team, track record, locked-up capital.
It was so much harder than I expected it to be.
First off: I was so enamored with the idea of helping to build something that I overruled my gut. I knew I wasn't a good fit for a sales role.
My friends know I'm more comfortable in the basement of the NY Public Library than bantering with a group of strangers. It is what it is.
Bad idea. Shortly after COVID hit I was let go.
I was angry. Resentful. But in the back of my mind I knew that I hadn't been a good fit.
In 2009, @BGurley bet on $AMZN in his PA because he saw the potential of AWS:
"it was obvious they were winning. You could see it in the number of startups that were building on their platform and that were adding to their platform"
"Many are quick to point out that only small businesses and rogue developers in large organizations are using AWS. This is exactly how these markets develop. Amazon is selling to the innovators and early adopters — the exact customers that are prescribed in Crossing the Chasm.
"First, as a “retailer” Amazon was comfortable running a low-margin business."
"The second piece of the strategy leverages the company’s prowess in customer support ... They would have the best developer relations attitude and execution in the business."