Business & Money: don’t be a dummy
I came across an incredible quote this week from Howard Lindzon that went as follows:
“I am always willing to let an investment become a trade and try not to let a trade become an investment.”
Before I touch on why I love this, here’s some background. The price of Ethereum has recently been falling. In response, Howard bought the dip with the idea that the price would likely bounce and trend higher over the long run. When it did, jumping from $140 to $240 in one week, he sold off some of the position to capture some of the profits.
With that context, Howard’s activity looked like that of a trader. When the price dips on an asset, and the trader can’t figure out why, they might buy the dip to capture a short term gain. This idea, however, flies in the face of how Howard previously has spoken about crypto investing. He’s been quoted as saying that he views this asset class as a long term play, similar to a venture capital investment. So why sell to make a quick buck if you’re taking a long term approach?
The idea is actually quite simple if you really think about it. If an investment gives your a return in 1 week, that you would otherwise be happy with over two years, it’s ok to take some money off the table.
I bought into Ethereum at $30. When it hit $300, I took some money off the table.
I bought into Bitcoin at $330. When it hit $2,000, I took some money off the table.
I bought Nvidia at $60. When it tripled in a year, I sold off most of the position.
When things are going well, it’s tempting to get greedy and keep pushing for more. But we live in an unpredictable world and we’re in the midst of one of the longest bull cycles on record. Don’t be a dummy!
Human Progress: owning vs renting
When I was 13 or so, I was obsessed with amassing a massive DVD collection. Anytime I went to Blockbuster to rent a movie, I would stop by the $5 box to see what I could add to my shelf. Then Netflix came along.
Remember that massive binder you used to drive around with that held all of your CDs? Add a 6-disc changer and now you can really stunt! Enter iTunes, and now Spotify.
One of the happiest days I can remember was buying my first car. I took the morning off of school on my 16th birthday to be sure I got my license at the earliest possible time and hit the road. I ditched my car in 2013 for Uber + public transportation.
Perhaps the single most tectonic shift in the economy that I’ve seen during my lifetime has been the shift away from owning towards renting and subscriptions. We ride in other people’s cars, sleep in their beds, and stream what ever type of media we’d like to consume. And all without buying anything.
The question I have is, where does this stop? As technology reduces friction and makes renting/subscribing, instead of owning, more practical, I wonder what personal and cultural preferences will prove too strong a counterbalance.
You probably thought the idea of sleeping in a stranger’s bed was gross 10 years ago, but Airbnb has made that normal and culturally acceptable. Right now, I’d say it’s pretty gross to think about sharing clothing. What if, instead of packing clothes, I could show up at a destination with fresh fits waiting for me in my hotel/AirBnB. Probably viable, but not sure about underwear and socks. Perhaps that too will change over time.
Philosophy: coming together and falling apart
Everyone knows about the Big Bang. It’s that theory of the universe’s birth that states that some 14 billion years ago the universe was this infinitely small, dense, hot place. Then a massive “explosion” tore things apart with unfathomable energy, creating all matter and hurling it in all directions at once.
Despite the evidence of cosmic background radiation, constant expansion, and the like, I don’t like this theory. Now I’m no cosmologist or astrophysicist and don’t purport to understand this topic at a deep level. Rather, I don’t like the theory because it begs the question, what happened before the Big Bang?
In talking about the birth of the universe, I can only apply the conventional meaning of the word “birth.” Babies are born, but you can explain what happened before. Sex, fertilization, gestation, and all that jazz. So the “birth” isn’t really a beginning in any real sense. Companies and ideas can also be born, but after a period of critical thought, amassing knowledge, etc.
So, coming back to the universe, my simple mind has difficulty conceptualizing what is meant by the “birth” of the universe as suggested by the Big Bang.
As such, the theory of the universe known as the Big Bounce makes much more sense to me. This is a hypothetical model of the universe that describes a cyclical process wherein the universe goes through constant expansion and contraction. So that big “explosion” referenced in the Big Bang, that was actually the result of the collapsing of a previous universe (the “bounce”).
And this second theory seems to follow the model that all other processes, both biological and not, follow.
Tides come in, and they go out.
Organisms are “born” and they die.
The planet freezes, and it thaws.
Empires rise, and subsequently fall.
All things seem to come together, then fall apart. They come together again, and then they fall apart again.
My Latest Discovery: OfferUp
The lady and I have increasingly been using OfferUp to buy used goods from local people. It’s basically Craigslist, but better. Since you have people tied to a profile and email address, you get real identity, and thus, more safety in the marketplace. It’s also mobile friendly allowing you to easily transact from your phone.