I am sharing this weekly email with you because I count you in the group of people I learn from and enjoy being around.
If you missed last week’s discussion: Why Young Men & Women Are Drifting Apart, What Are Gold & BTC Signalling, Navigating Energy Transition, How To Be More Resilient, Do It, Regrets of The Dying, The Technology Section....
Believe it or not, that “♡ Like” button is a big deal – it serves as a proxy to new visitors of this email’s value. If you got value out of reading, please let others know!
Quotes I Am Thinking About:
"A truth unsaid can still be felt. What needs to be discussed, but hasn't been said yet. Clear the air."
- James Clear
“Things may come to those who wait, but only the things left by those who hustle.”
- Abraham Lincoln
"A leader is a dealer in hope.”
- Napoleon
“The world breaks everyone, and afterward, some are strong at the broken places.”
- Ernest Hemingway
"Saying nothing... sometimes says the most.”
- Emily Dickinson
“In the case of good books, the point is not how many of them you can get through, but rather how many can get through to you.”
- Mortimer J. Adler
"If you can't explain it simply, you don't understand it well enough.”
- Albert Einstein
A. A Few Things Worth Checking Out:
1. WILTW / 13D had a report titled: “A record-hot 2023 could imply that a warming planet is already fundamentally altering how the climate system operates, much sooner than scientists had anticipated.” So writes Gavin Schmidt, director of NASA’s Goddard Institute for Space Studies. A realistic global climate risk assessment is urgently needed.
5 Key Insights:
Extreme weather events are becoming more frequent and severe, with the U.S. experiencing a billion-dollar disaster every two and a half weeks in the last six years, and global economic losses averaging $400 billion a year.
The year 2023 saw record-breaking temperatures, sea-surface temperatures, and a decline in Antarctic sea ice, which were not expected until the global climate reached 3 degrees C above the long-term average. Scientists hope this is a freak occurrence, otherwise, the impacts of warming have been significantly underestimated.
The annual rise in atmospheric CO2 concentration increased by 60% in 2023, despite only a 1.1% increase in global fossil-fuel CO2 emissions, due to the oceans and land areas absorbing less CO2 than normal. This increase in CO2 concentration acts like a thicker thermal blanket, trapping more heat from the sun.
Climate change is a threat multiplier, exacerbating global issues such as food insecurity, migration, political tension, and inflation. Food costs could rise 3.2% per year on average in the 2030s, and climate change could add up to 1.2% annually to overall inflation.
Carbon budgets used by policymakers are based on a 50% to 66% chance of meeting temperature targets, which puts humanity at risk of triggering climate tipping points. A financial-services-risk-management approach focusing on preventing worst-case scenarios, including the collapse of the Atlantic Meridional Overturning Circulation (AMOC), is needed as a matter of urgency.
2. Gavekal had a good piece titled: Where Is All The Money Coming From?
5 Key Insights:
Despite the Fed shrinking its balance sheet and broad money supply contracting, speculative fervor has taken hold in certain U.S. asset markets like crypto, tech stocks, and biotech. This raises questions about the sources of money fueling these rallies.
Excess liquidity from Covid stimulus, lower U.S. energy costs freeing up capital, increased money velocity from tight labor markets and expectations of government support, global dedollarization, Chinese easing, and Japanese capital seeking higher yields abroad are all potential contributors to current market exuberance.
In a globalized financial system, worldwide liquidity conditions may matter more than domestic money supply. Comparing equity market caps to aggregate "Big 4" (U.S., Eurozone, China, Japan) M2 suggests frothiness in the U.S. and Japan but not China.
However, new liquidity drains are materializing that could siphon money away from risk assets - chief among them accelerated U.S. Treasury issuance to fund large deficits. Inflows into crypto following bitcoin ETF launches and breakouts in gold prices also represent competing demands on capital.
The confluence of these cross-currents points to a potential sea change in global liquidity conditions over the coming months. With liquidity becoming scarcer, markets may be in for a volatile ride and currently expensive assets look vulnerable to corrections. Monitoring evolving liquidity dynamics will be key to navigating the shifting investment landscape ahead.
3. A few days I hosted a private zoom with my friend Professor Andrew Scott on his book “The Longevity Imperative”. If you are interested in the Future of Work, Longevity and living a good long life it’s a must read.
The 3 Key Insights I got:
The importance of shifting from an "aging society" narrative to a "longevity imperative" mindset: The negative view of aging needs to be replaced with a more positive focus on adapting to longer lives through innovation and investment. For the first time, the young can expect to grow old, which changes the incentives to invest in the future.
Prioritizing healthspan and geroscience: Slowing the aging process has a more significant impact than tackling individual diseases. By delaying aging-related diseases, we can create positive synergies between them. The focus should shift from disease treatment to prevention and geroscience.
Adapting work, retirement, and finance to longer lives: Keeping older workers (50+) in the labor force is crucial for economic growth. Retirement patterns are changing, and jobs need to become more age-friendly. Longer lives also require new financial products and a convergence of health and wealth management. Additionally, new cultural narratives on aging as lifelong development are necessary.
4. Professor Ethan Mollick has been my secret weapon around all things AI.
He is an Associate Professor at the Wharton School of the University of Pennsylvania, where he studies and teaches innovation, entrepreneurship, and AI’s impact on work and education.
He recently spoke to Azeem Azhar at Exponential.
3 Key Insights:
AI tools are rapidly evolving and altering workflows across industries. To stay ahead, individuals should allocate substantial time to hands-on experimentation with cutting-edge AI models, developing a nuanced understanding of their strengths, weaknesses, and emergent capabilities. Flexibility and continuous learning are crucial.
AI can serve as a versatile intellectual partner, augmenting human abilities in diverse tasks from creative writing to strategic analysis. Unlocking AI's potential relies on effective human-AI interaction through carefully crafted prompts, contextual framing, and treating the AI with an anthropomorphized persona suited to the task at hand.
As AI rapidly reshapes the nature of work, organizations face a dilemma in balancing efficiency with adaptability. While the disruptive potential of AI elicits understandable existential concerns, it also holds immense promise for positive transformations, such as democratizing access to high-quality education and freeing humans from mundane toil.
5. This mini essay on X / Twitter made me think about markets, democracy and labour differently.
B. Humanise by Thomas Heatherwick
Renowned designer and architect Thomas Heatherwick's latest book, "Humanise," presents a compelling argument for a paradigm shift in architectural design.
He challenges the prevailing trend of 'boring' buildings that dominate our urban landscapes, advocating instead for structures that prioritise visual interest, emotional engagement, and human well-being.
He critiques modernist architecture for its lack of joy and humanity, highlighting the negative impact of mundane designs on individuals' well-being. He proposes a new approach to architecture that embraces creativity, emotion, and nature, aiming to create buildings that evoke positive emotions and cater to the needs of their users.
The book invites readers to reimagine the built environment as a place of beauty, inspiration, and connection, where architecture becomes a source of joy and enrichment for all who interact with it.
Here is a little introduction to my friend Thomas Heatherwick. A genius.
C. News and Charts You Might Have Missed
1. A study by Atlassian revealed that excessive meetings are the biggest hurdle to worker productivity, even outweighing factors like unclear goals or lack of motivation. ~80% of workers reported feeling overwhelmed by the number of meetings they attend, making it difficult to get their work done.
2. ~Half of the world's top-tier AI researchers earned undergraduate degrees in China, compared to 18% in the US, new study says. While the US remains the premier hub for elite AI talent, hosting 60% of the top AI institutions, China is producing a larger portion of the world's top AI researchers, from 29% in 2019 to 47% in 2022.
3. An interesting divergence.
4. US Households care far more about Equity Markets then most other developed countries. Thank you Nicolas.
5. It’s still early for E-Commerce.
C. The Science and Technology Section:
1. Ben Thompson at Stratechery wrote a great piece on NVIDIA titled: Nvidia Waves and Moats.
The key ideas:
Nvidia's GTC event, dubbed "AI Woodstock," highlighted the company's leading position in the AI chip market, with the unveiling of the Blackwell B200 GPU marking a significant milestone in the AI revolution. The shift in focus at this year's GTC towards the chip launch itself, rather than potential use cases and software libraries, reflects Nvidia's recognition of the clear demand for generative AI and the company's aim to solidify its dominance in this space.
Blackwell's performance improvements, achieved through increased size and enhanced parallelism, pave the way for the development of even more sophisticated AI models, such as GPT-6 and beyond, maintaining Nvidia's competitive edge.
The introduction of Nvidia Inference Microservices (NIMs) serves as a tactical response to the threat of customers circumventing Nvidia's CUDA framework, by creating a new software moat that ensures the exclusive use of Nvidia GPUs for deploying generative AI models, thereby reinforcing customer lock-in.
This was a good podcast with Ben Thompson to get upto speed on all things NVIDIA.
2. My favourite writer and thinker on all things semiconductors - Doug McLaughlin at Fabricated Knowledge had a great piece on NVIDIA titled Jensen's World: Compressing Reality.
The big ideas:
The concept of AI factories, as explained by Jensen, revolves around the idea that simulating reality using AI models is more efficient, flexible, and often better than interacting with reality itself. This shift towards simulation is the core of Nvidia's AI strategy.
Nvidia's competitive advantage lies not just in its silicon improvements but in its system-level optimizations, such as the NVL72 switch system, RAS engine for reliability, and inference optimization through networking and DPUs.
Nvidia is leveraging proprietary standards and solutions, such as the 200 GB/s SerDes and copper direct drive, to outpace industry consortiums and maintain its competitive edge in AI infrastructure.
The company is strategically selling complete systems (like the DGX superpod) to customers, which dilutes the differentiation of hyperscalers and positions Nvidia as a key player in the AI infrastructure space.
The race between Nvidia and hyperscalers will be determined by the pace of semiconductor process improvements and infrastructure scale. Nvidia's ability to deliver leading-edge silicon at a rapid pace may prove to be a more significant differentiator than the hyperscalers' infrastructure advantages.
3. Super bio-tech piece titled: Beyond Steel Tanks.
5 Key Insights:
The current shortage of GLP-1 obesity drugs despite massive investments by Novo Nordisk and Eli Lilly exposes the limitations of traditional biomanufacturing methods and highlights the need for alternative production strategies to meet the growing demand for biologic drugs.
Cell-free systems, which harness enzymes outside of living cells, and mRNA-based technologies that instruct the body's cells to produce therapeutic proteins, offer promising solutions for flexible, efficient and localized biomanufacturing without the constraints of cell-based methods.
Molecular farming, or producing recombinant proteins in genetically engineered plants and animals, has the potential to dramatically reduce the cost and increase the scale of biomanufacturing, but overcoming technical hurdles, regulatory barriers and public perception issues is crucial for its wider adoption.
The confinement of synthetic biology to steel tanks in laboratories stems from containment and perception concerns, but embracing a vision of ubiquitous and distributed biotechnology could help address environmental challenges and enable local bioproduction of various products using existing biomass.
Solving the GLP-1 drug shortage and realizing the broader promise of synthetic biology to "grow anything" will require a multi-pronged approach that includes advanced cell-free systems, more efficient fermentation infrastructure, and bold molecular farming solutions, ultimately moving biomanufacturing beyond the limitations of steel tanks.
4. Interesting piece on Bitcoin titled: Bitcoin Endgames & The New Hyperagents.
It discusses the potential societal implications of the rise of Bitcoin and cryptocurrency, without making predictions about its price movements or technical functionality.
Key Insights:
Bitcoin is a "psychological commodity," deriving its value solely from others' willingness to pay a specific price. There are two potential end states for Bitcoin: either it becomes a haven during a global economic collapse, or it becomes a bubble that ultimately bursts.
In both scenarios, there is a transfer of power from the current "hyperagents" (governments, institutions, and the wealthy) to early crypto adopters.
The rise of Bitcoin could lead to different outcomes, such as crypto early adopters gaining significant influence, accelerated corporate oligopoly, or a government crackdown on cryptocurrency.
The author concludes by expressing concern about the potential societal implications of this power transfer and hoping that the new "winners" in the crypto space will find meaning, empathy, and wisdom in their newfound positions of influence.
Believe it or not, that “♡ Like” button is a big deal – it serves as a proxy to new visitors of this publication’s value. If you got value out of reading, please let others know!
This was entertaining on Netflix.