anecdotes

“Every investor needs a mental model,” said the CIO. “Without one we’re lost.” We weaved through New York. “I developed mine years ago,” he said, crossing Lexington, mid-block, diagonally, headed south. “Markets move in cycles. After a euphoria comes the fall. But euphoria tends to persist.” The lights toggled on our approach to Park and 61st, we made our way, a steady pace. “Late cycle, if enough people ignore the w

“Global trade is a never-ending prisoner’s dilemma,” said the CIO, explaining that we’re collectively better off through cooperation but nevertheless periodically seek short-term advantage by exploiting the blindly optimistic. “The most successful prisoner’s dilemma strategy is ‘tit for tat’ in which both players cooperate initially.” But once one player chooses non-cooperation, the opponent retaliates with non-coope

His passion for it was fading. He knew that much. “But what to do?” whispered the Economist, mostly to himself. For decades he’d examined every word, placing it into context, comparing the endless stream of Fed statements to their predecessors. He took great pride in not missing a single interview by all twelve voting members. While he couldn’t recite Fed Chair press conferences verbatim, he got close. And that impre

“Look closely,” whispered Eagle soaring, Gotham far below. So many bridges, tunnels, ships, connecting the narrow rock to a vast world, stretching out forever. From such heights, the city appeared inanimate, cars motionless, ferries frozen, white brushstrokes in their wake. “Humans struggle to see things that move slowly,” said Eagle. Each day, 2.4mm people arrive, depart, Gotham’s population flowing to 4mm, ebbing t

He would have me throw the bones, seated on skins in a quiet yurt. The cup’s contents tumbled across the floor. Tiny bones, hyena, lion, leopard, vulture, a small gold Krugerrand, colorful beads, ivory, crystal, ironwood. The South African had dedicated his journey to studying western medicine and Namibian shamanism; the former a miracle, the latter magical. He combined the two, shared the gift. Shamanism connects us

“I very strongly disagree with you,” he said. I smiled, happy to have smart friends eager to argue. Because being wrong sucks. I’d rather hear it than endure it. But it’s rarely so simple as being right or wrong, because assets are priced based on a consensus view of the future. So you can be right and make no money. Anyhow, since tomorrow often looks like today, which usually resembles yesterday, most people look be

Change is magnificent, he thought, along the stream. Walking. Spring had become summer, lush, in what seemed an instant, little by little, then all at once. The barren banks were now covered in green, dense bramble, concealing. Across the world change is taking hold. For the entirety of his career, with few exceptions, the study of markets had been an examination of central bank policy. On the Chicago floor in 1989,

On he walked. So many charts swirling in his mind, each its own story, all somehow connected, everything is. Major highs and lows are rare moments of wild hope or great fear, vivid, mistaken. He’d lived the 1989 Nikkei high, that euphoria, the hysteria, Japan’s Rockefeller Center purchase. He’d experienced every turn since. While it’s impossible to pick a high or low, the character of each is distinct. In 1989, with

“Americans are unwilling to save,” said the CIO. “The Japanese and Germans are unwilling to spend,” he continued. “If the latter two could generate exceptional investment returns on their savings they’d have all the money in the world within two business cycles.” They haven’t, and won’t. “The US model is credit-driven, with Americans in perpetual search of the sucker, like buyers of Tesla and Netflix bonds.” They loo