ESG in practice is similar to when companies brand products as green, or add a cure cancer symbol and donate some trivial % of sales. It’s marketing with very little substance. Both consumers and investors want to feel good about themselves without sacrificing price or returns.
2/ Why so much marketing effort (and sales success) around such little substance? I think it's a chain effect of an "intolerant minority", and shows both the strength and weakness of that "intolerance." A small % of investors (and consumers) care about these topics enough to
3/ at least somewhat affect their behavior. They go to their pension, endowment, fund manager, or favorite retailer, and demand that action to be taken. But they don't care enough to accept meaningfully lower returns or higher prices as long as the concerns are paid lip service.
4/ the result is that the biggest retailers slap a "livestrong" partnership on their website, donate a trivial % of sales to a charity, and everyone goes about their day. Or in the case of investors, they get to allocate to an "ESG" fund, without actually changing anything.
5/ what I mean about the "intolerant minority", is that a small group can and will meaningfully tarnish a brand if it gives a "middle finger" to their favorite causes. So everyone keeps their head down doing just enough to avoid standing out as a prime target.
6/ I'm all for corporate charitable giving (that's up to the owners, who may be pressured by customers). I'm against ESG as it's implemented in practice, because it's an entirely subjective and political implementation. I don't know if it could be done better, probably not.

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More from @AriDavidPaul

26 Apr
What's the best place to go for practical discussions of PoS game theory (particularly through lens of ethereum's upcoming transition)? I'm a bit out of date on the topic. Tell me why this is wrong: the cost of attack is likely marginally higher than prevailing lending rates /1
2/ an attacker needs to borrow x% of eth for y amount of time. The interest cost of that borrow over that period of time is the cost of attack. The one "bottleneck" is locating sufficient loans.
3/ if this is correct, than the interest rate probably doesn't matter. Unlike with buying (where you'd drive the price up tremendously acquiring a large stack), loan rates are more homogenous such that you likely wouldn't have to drive rates up all that much to attract nearly all
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20 Apr
Was asked an interesting question by an old crypto friend: he noted that I seem to assess some projects like mobilecoin very differently than others (in this case, Dash). In some cases I seem to care about the concentration of token ownership, but not in others. /1
2/ I assess companies and cryptocurrencies very differently depending on what they're trying to be and their target use case. For example, if you're valuing a local restaurant, you probably won't spend much time on their software or global brand.
3/ for a proof of stake network, the distribution of coin ownership is paramount, since that's what is literally securing the network. Ownership distribution is important but far less so for a PoW network.
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19 Apr
Bayes theorem is the heart of a great deal of practical probability. Imo, it should be taught in late middle school, and statistics/probability should replace calculus as basic math education after arithmetic. /1
2/ I probably use calculus once a quarter in my work (which includes a good ideal of applied math, derivatives modeling, quantitative portfolio management and risk assessment etc.). I use Bayes theorem *daily* both in work and in day to day life.
3/ Bayes theorem comes up constantly. I use it when I’m evaluating which vaccine to get, what hospital and medications to trust, interpreting political polls and policies, and even whether to take an umbrella to work.
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12 Apr
"Every musician wants to be a comedian." <- a profound recruiting insight that I've learned the hard way. A thread. /1
2/ the quote references the idea that many musicians enjoy chatting up an audience in between sets. For some, it's not enough to be great at what they do (musician), they want to be involved in many things (general entertainment). It's the generalist vs specialist dilemma.
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6 Apr
Crypto currently offers basically no economies of scale. I.e. with the same skills, a professional trader/investor will earn a far, far higher ROI running a smaller amount of their own money than launching a fund. /1
2/ fund management also brings it with expenses and headaches on the operational, legal, compliance, accounting, HR etc side of things. Join a fund if you want to learn, gain access to tools/platform, and moderately diversify economic exposure.
3/ launch a fund if you have the team/skills necessary (not just investing but ops, marketing etc), and want to spend 5+ years in an entrepreneurial grind to build a company.
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5 Apr
Paradox #15: Braess's paradox - adding roads may slow down traffic. This is really two separate paradoxes. /1
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3/ so you could say that adding roads doesn't do anything...but in this framing it does. It may not reduce commute times, but it's still adding value to peoples' lives. Effectively those extra roads let people get cheaper rent or prettier home surroundings.
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