#208: A Quick Check-in Check-up

I am currently taking a break from my regular routine of daily newsletters. I have been itching to write for a number of days but have resisted as I have been working on a few interesting projects that I wanted to give my full attention.

Last week I went away. with my extended family on a short cruise to celebrate my father-in-law’s 80th. I spent 3 days with zero connection to the outside world, which was very nice. I have been writing some performance analytic software over the last few weeks, and this week I have been writing code for most of the day and night. I am married to an angel. I must be so boring, as work is fun for me, so I have endless energy for it. For the umpteenth year, I never bothered to stay up and bring in the New Year, even though we were at a New Year’s Eve party. Yes, I am always the first to slip away from a gathering. Guilty as charged.

Next week I am away for the week, staying in a small coastal town. I am not planning on writing a newsletter but hope to write a blog post on the software I have been writing, that is, if things work out and I complete the MVP. Over the past few days I have put together the curriculum of a course I will be releasing in the next month or so focused on building an automated trading system.

I have also started a cool little side project, whereby I am building an AI mini-me. I have carved out 30 minutes in my day every day to ask and answer questions related to trading, system development, management, coaching, backtesting, coding, etc. I have seen how consistency and persistence can build up a large body of content in a relatively short space of time. This is my 208th newsletter in 10 months. I hope after 4-6 months I will be able to compile my Q&A into a large language model that will be packaged as an A.I. trader’s mentor available at any time of the day or night.

Following the theme of consistency, today marks the day 5 years ago when I embarked on one of the greatest projects of my life. I committed to join the Daf Yomi cycle, where I spend about an hour every day (no breaks for holidays—zero exceptions) studying a page (both sides) of the Talmud. I am 2.5 years away from completing a full cycle, and I am already dreaming of doing the next cycle. As Socrates said, the more we know, the more we know we don’t know. Something like that, I think.

Finally, I am hoping to find some time to do more reading this holiday. I have found myself doomscrolling way too much. I used to be so much more productive with my time reading books, podcasts, and long-form articles instead of sound bites & tweets. I really have no idea how kids today are able to study with a smartphone nearby.

S2N Spotlight

As today is a “bonus” post. I thought I would write something philosophical, economic, and quantitative.

Most of us are highly engaged with the digital world and the influencers who control so much of the narrative. As someone trying to grow my presence in this space, it’s natural to look with envy and amazement at how some of these people have people hanging on every word or syllable they have to say or text, no matter the quality of what they are saying. Whereas your humble servant finds it difficult to give away the toils of my labour for free.

Patrick Plaisance published a fascinating article in ‘Psychology Today’ titled ‘What’s Needed in Our Digital Lives: The Virtue of Humility.’ He writes, “Today, humility is considered a vice in many corners of our proclamatory digital environment. Instead, hubris is the order of the day. Bold pronouncement of opinion, rather than honest inquiry, dominates our digital lives.”

My point here is not to depress you; it is rather to show that humility is a virtue to be pursued and is slowly gaining a following. Socrates and other great scholars taught us how seeing how limited our knowledge is should humble us. Psychologists have found It turns out that people who exhibit humility also tend to be wise and skilful in a host of ways. People with a high degree of humility also tend to show more general knowledge, have more intrinsic motivation to learn, and are more prone to reflection and intellectual engagement (Krumrei-Mancuso et al., 2020). Humility is correlated with curiosity, tolerance for ambiguity, and low levels of dogmatism (Leary et al., 2017). People with high levels of humility also are more open to opposing views and are more likely to exhibit a growth mindset (Porter & Schumann, 2018). They also engage in more sophisticated information-seeking (Gorichanaz, 2021).

In today’s WSJ there was an excellent article, “What Happens When a Whole Generation Never Grows Up.” Sadly, this is quite depressing without a positive ending, and it follows on the theme of our digital world. In essence, people who are actually doing better salary-wise than their parents were at the same time in their lives see themselves as failures. Instead of being satisfied with a nice basic home. They have been conditioned to desiring homes that are for the wealthy as they see their friends and associates rocking the best of the best online. The share of childless adults under 50 who say they are unlikely to ever have kids, meanwhile, rose 10 percentage points between 2018 and 2023, from 37% to 47%, according to the Pew Research Centre.

Just over half of Americans between the ages of 30 and 40 were married as of last year, according to an analysis of American Community Survey data by Aspen Economic Strategy Group economist Luke Pardue. This is down from more than two-thirds in 1990, when those in the middle of the cohort were born. The share of women in this age range who had ever given birth fell 7 percentage points between 2012 and 2022 alone, Current Population Survey data show, from 78% to 71%.

These demographic shifts are going to have a devastating impact on economic growth in the years and decades to come. I think this time of the year is very, very hard for many people who don’t have strong support systems or are struggling in some shape or form. The digital world here certainly plays its role.

Now for something quantitative.

Happy 45²

20 + 25 = 45, and 45² = 2025, a “square” year. The last “square” year was 1936, and the next one will be 2116. Very few of us will live in two “square” years.

Even better; 2025 = 45² is a “perfect square” year.

It is the square of the sum of ALL the digits of the decimal numbering system:

(0 + 1 + 2 + 3 + 4 + 5 + 6 + 7 + 8 + 9)² = 2025.

It also happens to be the sum of the cubes of ALL the digits of the decimal numbering system.

(0³ + 1³ + 2³ + 3³ + 4³ + 5³ + 6³ + 7³ + 8³ + 9³) = 2025.

Enjoy 2025!

On a more serious note, a couple of weeks ago, Google announced Willow, their quantum computing chip. Willow’s speed is almost incomprehensible—according to Google, it’s able to perform a computation in under five minutes that would take one of today’s fastest supercomputers 10 septillion years to solve. Ten septillion is 10,000,000,000,000,000,000,000,000 years.

The amount of good that will come from quantum computing is really unimaginable. However, with all powerful forces, there are equal negative forces that have the potential to work against the good. Coincidentia Oppositorum (I always throw that Latin in as a flex 😎). The first thing all the Bitcoin maximalists need to factor in is how secure the cryptography protecting their wealth is. We are not far away from the ability to crack these encryption codes. This will require the entire blockchain moving to quantum-grade cryptography to protect their “money.” This is not trivial and will be something I will be spending more time researching and writing about during the year.

It turns out this spotlight was pretty heavy, sorry. It just came out but probably speaks to my views on US stocks. I think prices are heavy and likely to struggle this year. There it is; I made a forecast.

S2N Observations

I am pretty sure most people didn’t notice the liquidity strains brewing under the surface last week as the Reverse Repo market shot up from $100 billion to more than $400 billion. Clearly people were preparing for some strains to be felt within the system. It seems all is well for now. So much more to discuss here. Interest rates are the key to cracking the way markets play out.

Tesla, the most expensive mega cap, released their global deliveries for 2024. Despite heavy promotion in the final quarter, they were still not able to grow the previous year’s numbers. This is going to be one helluva year for the Musk-Trump bromance.