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Ep. 765: David Weinberger Interview with Michael Covel on Trend Following Radio

David Weinberger
David Weinberger

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David Weinberger is an American technologist, professional speaker, and commentator, probably best known as co-author of the Cluetrain Manifesto (originally a website, and eventually a book, which has been described as “a primer on Internet marketing”). Weinberger’s work focuses on how the Internet is changing human relationships, communication, knowledge and society.

Artificial intelligence, big data, modern science, and the internet are all revealing a fundamental truth: The world is vastly more complex and unpredictable than we’ve allowed ourselves to see. Now that technology is enabling us to take advantage of all the chaos it’s revealing, our understanding of how things happen is changing–and with it our deepest strategies for predicting, preparing for, and managing our world. This affects everything, from how we approach our everyday lives to how we make moral decisions and how we run our businesses.

Take machine learning, which makes better predictions about weather, medical diagnoses, and product performance than we do–but often does so at the expense of our understanding of how it arrived at those predictions. While this can be dangerous, accepting it is also liberating, for it enables us to harness the complexity of an immense amount of data around us. We are also turning to strategies that avoid anticipating the future altogether, such as A/B testing, Minimum Viable Products, open platforms, and user-modifiable video games.

Through stories from history, business, and technology, philosopher and technologist David Weinberger finds the unifying truths lying below the surface of the tools we take for granted–and a future in which our best strategy often requires holding back from anticipating and instead creating as many possibilities as we can. The book’s imperative for business and beyond is simple: Make. More. Future. The result is a world no longer focused on limitations but optimized for possibilities.

In this episode of Trend Following Radio:

  • Everyday Chaos: Technology, Complexity, and How We’re Thriving in a New World of Possibility

Mentions & Resources:

“Your work has changed my life, and I am attempting to pass that on…”

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Michael,

Enjoyed the foundation podcast, had a few thoughts on the financial advisor perspective, having been one for 20 years. I have tried to introduce trend following into my practice, but the struggle is the same as the buy and hold struggle, in that people ultimately have to take enough personal responsibility to have some understanding to logically evaluate the investment process we are using to try and accomplish their goals. If they don’t, eventually they will come to a point that causes a them to make an emotional decision.

Your work has changed my life, and I am attempting to pass that on. Have given many friends your books, have never had someone come back as excited as I was after reading. I take that as proof why trend following will always work!

I read once that Warren Buffet always told his family that they should invest in Treasury Bonds, guess he probably knew their emotions would get the better of them.

Thank you always!

Chris

Thanks!

“I’m about five hours into listening to your Trend Following Book…”

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Michael,

Thanks for all the great updates and also great information from the lessons. I hope you’re enjoying China. I’m about five hours into listening to your Trend Following Book and also decided to pick up your Turtle Trading. I really couldn’t help myself with all the references to the intriguing Richard Dennis and also think this is an amazing book! I actually listened to almost through chapter 5 of Turtle currently so I’m perhaps a quarter through each! I agree with you too that I think this would be an amazing movie and I could see it similar to the MIT/Vegas movie (21, adapted from Bringing Down the House or even a more serious Trading Places focusing on the retro pop culture that you sprinkle into the book with Trend Trading). I loved your opening quotation and so many things so far about the book. I wondered if you already had a script. I’m not doing this currently at all but I used to be writing scripts (TV/Film) and could really see this as a film. I’m currently focusing on trying to learn the stock market and trading with balancing my day job and trying to hold this down (academic technology for an academic library system) so learning the stock methodologies and my job is enough but your books and the characters did really get me thinking regarding a great movie! I wondered why this hasn’t been made yet! I hope you do this as I could see it as an amazing feature. I also just printed the notes for your Turtle Trading book as I bought this through Audible. I find with time constraints it easier to listen to ;your books on the way to work etc. to fit these in. Really great and I really appreciate all of your amazing diligent work. This is also simply in the way of a suggestion but it would be good to also include for the audio version pdf (Audible) in the notes the formula’s throughout this chapter (i.e the risk expectancy that begins this chapter, computing n and the average true range etc.) and to keep this in mind for future notes. This would also be very helpful. I’m going to have to listen to this chapter again but also probably also a great motivation to buy the text copy, lol! Well, thank you for the wealth of information here and also the great inspirational tone of the work!!

Wishing you the best,

Ray

Ray [name]
San Marcos, Texas

Thanks! Notes you need just emailed.

“We want to believe, and we often get stuck and intertwine our belief with our identity…”

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Hi Michael,

Your podcasts, intertwined with my reading, keep bringing up ideas. One of the recent ideas is the topic of Type 1 vs Type 2 errors.

I was reading in (I think) “Thinking in Bets,” that we all have a ‘bias to believe.’ We want to believe, and we often get stuck and intertwine our belief with our identity.

The author describes our evolutionary heritage as a possible reason for our desire to believe. For example, if we hear some rustling in the bushes, it is in our interest to move or run, as it may be a Lion. If we don’t move or run, and it is a lion, we die, a type 1 error. Yet, if we don’t run, even if the odds are 1000:1, we are dead the last time, a type 2 error.

So it is good to be ‘safe,’ in this world.

In a recent podcast, discussing the Turtles, and investing: the concept of making type 1 errors was also ‘ok,’ but it is not good to make a type 2 error.

While the consequences are not a dire, a type 1 error, the downside can be addressed by: 1. limiting an investment amount/Kelly criterion, or having 2. stop losses. What we don’t want to miss is the Type 2 error, of missing the (potentially) unlimited upside–which we can’t predict, and don’t know when they will happen.

The insight that you described, along these lines, is that the APPEARANCE of safety, in the type1 scenario, leads to mediocrity or being average. WHILE the actual value, the actual living life, the actual big gains to be had, are NOT getting involved, thus making a type2 error. The error of Opportunity Cost, etc.

I really didn’t think that I would use these statistical definitions outside of a classroom, yet here it is… and this idea of type1 and type2 errors, and how to act once they are understood, now have real life.

I expect these ideas will now be part of my broader conversations, and actions.

Thanks for the podcasts,

(and I am one of your premium members of Trend following [Flagship]… still studying and learning)

Best,

Michael [name]

Thanks!

“I am trying to start my journey in Trend trading…”

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Hi Michael,

I came across your book through Steve Burns books as I am trying to start my journey in Trend trading and currently doing my research and learning to trade this way. My biggest challenge currently has been searching for the trends (screening for stocks) and then knowing how long to wait if the stock is not moving and i suppose when to sell (especially with weeks like these i.e. Trump/China Tarriffs week). I purchased your book through Audible and am really enjoying listening to it and learning about these traders/methods. I had heard you had done a movie in 2009 and I wanted to get also access through your website and also sign up for the interactive presentation mentioned in the book. I’m enclosing as you mentioned a copy of my my audible purchase history as a jpeg. It’s the third book down and I purchased this on May 8th through my Audible subscription. I’m currently trying to read and listen to a number of books and podcasts trying to get up to speed with these newer methods.

Sincerely,

Ray

Enjoy the video I just sent!

Ep. 763: Thales Teixeria Interview with Michael Covel on Trend Following Radio

Thales Teixeria
Thales Teixeria

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Based on eight years of research visiting dozens of startups, tech companies and incumbents, Harvard Business School professor Thales Teixeira shows how and why consumer industries are disrupted, and what established companies can do about it—while highlighting the specific strategies potential startups use to gain a competitive edge.

There is a pattern to digital disruption in an industry, whether the disruptor is Uber, Airbnb, Dollar Shave Club, Pillpack or one of countless other startups that have stolen large portions of market share from industry leaders, often in a matter of a few years.

As Teixeira makes clear, the nature of competition has fundamentally changed. Using innovative new business models, startups are stealing customers by breaking the links in how consumers discover, buy and use products and services. By decoupling the customer value chain, these startups, instead of taking on the Unilevers and Nikes, BMW’s and Sephoras of the world head on, peel away a piece of the consumer purchasing process. Birchbox offered women a new way to sample beauty products from a variety of companies from the convenience of their homes, without having to visit a store. Turo doesn’t compete with GM. Instead, it offers people the benefit of driving without having to own a car themselves.

Illustrated with vivid, indepth and exclusive accounts of both startups, and reigning incumbents like Best Buy and Comcast, as they struggle to respond, Unlocking the Customer Value Chain is an essential guide to demystifying how digital disruption takes place – and what companies can do to defend themselves.

In this episode of Trend Following Radio:

  • Unlocking the Customer Value Chain: How Decoupling Drives Consumer Disruption

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