You might not be willing to devote the time and energy to understand how electricity actually works, or the mechanisms of your democracy, or the insights behind irrational decision making. More likely, you don’t want to expend the emotional labor to push through feeling dumb as you dig deep on your way to getting smart.
That’s always been an option. You can just use the tool without understanding it, copy the leader without realizing where she’s going, follow instructions without questioning them.
You can choose to be a cog in a machine you don’t understand.
If that’s working for you, no need to change it.
It made me ponder: trust the Fed, trust buy and hold, etc. If it’s working for you, no need to change it.
My guest today is Jim Rogers, an American investor and financial commentator based in Singapore. Rogers is the chairman of Beeland Interests, Inc. He was the co-founder of the Quantum Fund and Soros Fund Management. He was also the creator of the Rogers International Commodities Index (RICI). Rogers does not consider himself a member of any school of economic thought, but has acknowledged that his views best fit the label of the Austrian School of economics.
The topic is central banking system.
In this episode of Trend Following Radio we discuss:
Negative interest rates
Central banking systems
Market crashes
The impact of unintended consequences
Preparing for the future
“For the last 30 years look at who we have had down there [as the head of the Federal Reserve]. They have all been academic and political hacks.” – Jim Rogers
My guest today is Philip Tetloc, a Canadian American political science writer currently at The Wharton School of the University of Pennsylvania. He is right at the intersection of psychology, political science and organizational behavior. Phil is also a co-principle investigator of The Good Judgment Project, a study on the art and science of prediction and forecasting.
The topic is his book Superforecasting: The Art and Science of Prediction.
In this episode of Trend Following Radio we discuss:
What are superforecasters?
Probabilistic thinking
Looking at data
“It is interesting that their seems to be more software engineers that are superforecasters than political scientists.” – Phil Tetlock
My guest today is Angus Deaton, the fifth Nobel Prize winner to appear on this podcast. Deaton is a British American economist, and currently a Senior Scholar and the Dwight D. Eisenhower Professor of Economics and International Affairs Emeritus at the Princeton School of Public and International Affairs and the Economics Department at Princeton University. His research focuses primarily on poverty, inequality, health, wellbeing, and economic development. In 2015, he was awarded the Nobel Memorial Prize in Economic Sciences for his analysis of consumption, poverty, and welfare.
The topic is his book The Great Escape: Health, Wealth, and the Origins of Inequality.
In this episode of Trend Following Radio we discuss:
Unemployment
Minimum Wage
Poverty
Economics
Money and happiness
The birth lottery
“In periods where there has been a tremendous amount of innovation, there is typically a very large increase in inequality.” – Angus Deaton
I like what Lou Holtz says here, but it’s better IMO without “names”. So I made that edit:
—
The [name] are right, there are two Americas. The America that works and the America that doesn’t. The America that contributes and the America that doesn’t. It’s not the haves and the have nots, it’s the dos and the don’ts. Some people do their duty as Americans, obey the law, support themselves, contribute to society and others don’t. That’s the divide in America.
It’s not about income inequality, it’s about civic irresponsibility. It’s about a political party that preaches hatred, greed and victimization in order to win elective office. It’s about a political party that loves power more than it loves its country.
That’s not invective, that’s truth, and it’s about time someone said it.
The politics of envy was on proud display a couple weeks ago when [name] pledged the rest of [name] term to fighting “income inequality.” [name] noted that some people make more than other people, that some people have higher incomes than others, and [name] says that’s not just. That is the rationale of thievery.
The other guy has it, you want it, [name] will take it for you. Vote [name]. That is the philosophy that produced [name].
It is the electoral philosophy that is destroying America. It conceals a fundamental deviation from American values and common sense because it ends up not benefiting the people who support it, but a betrayal.
The [name] have not empowered their followers, they have enslaved them in a culture of dependence and entitlement, of victim-hood and anger instead of ability and hope. The [name] premise – that you reduce income inequality by debasing the successful–seeks to deny the successful the consequences of their choices and spare the unsuccessful the consequences of their choices. Because, by and large, income variations in society are a result of different choices leading to different consequences.
Those who choose wisely and responsibly have a far greater likelihood of success, while those who choose foolishly and irresponsibly have a far greater likelihood of failure.
Success and failure usually manifest themselves in personal and family income. You choose to drop out of high school or to skip college – and you are apt to have a different outcome than someone who gets a diploma and pushes on with purposeful education.
You have your children out of wedlock and life is apt to take one course; you have them within a marriage and life is apt to take another course. Most often in life our destination is determined by the course we take.
My doctor, for example, makes far more than I do. There is significant income inequality between us. Our lives have had an inequality of outcome, but, our lives also have had an in equality of effort. While my doctor went to college and then devoted his young adulthood to medical school and residency, I got a job in a restaurant. He made a choice, I made a choice, and our choices led us to different outcomes. His outcome pays a lot better than mine. Does that mean he cheated and [name] needs to take away his wealth? No, it means we are both free men in a free society where free choices lead to different outcomes.
It is not inequality [name] intends to take away, it is freedom. The freedom to succeed, and the freedom to fail. There is no true option for success if there is no true option for failure. The pursuit of happiness means a whole lot less when you face the punitive hand of government if your pursuit brings you more happiness than the other guy. Even if the other guy sat on his arse and did nothing. Even if the other guy made a lifetime’s worth of asinine and short sighted decisions.
[name] and the [name] preach equality of outcome as a right, while completely ignoring inequality of effort. The simple Law of the Harvest – as ye sow, so shall ye reap – is sometimes applied as, “The harder you work, the more you get.”
[name] would turn that upside down. Those who achieve are to be punished as enemies of society and those who fail are to be rewarded as wards of society. Entitlement will replace effort as the key to upward mobility in American society if [name] gets his way. [name] seeks a lowest common denominator society in which the government besieges the successful and productive to foster equality through mediocrity. [name] and [name] party speak of two Americas, and their grip on power is based on using the votes of one to sap the productivity of the other. America is not divided by the differences in our outcomes, it is divided by the differences in our efforts.
It is a false philosophy to say one man’s success comes about unavoidably as the result of another man’s victimization.
What [name] offered was not a solution, but a separatism. [name] fomented division and strife, pitted one set of Americans against another for [name] own political benefit. That’s what socialists offer. Marxist class warfare wrapped up with a bow. Two Americas, coming closer each day to proving the truth to Lincoln’s maxim that a house divided against itself cannot stand.
“Life is ten percent what happens to you and ninety percent how you respond to it.”
I received a call from my dad asking if I was OK with the market panic selloff. Even though I had explained how I trade he and many others still think a drop in markets is bad for everyone. Naturally the panic selling was not the start of the down trend so I was nicely short the Dow prior to sell off.
I still can’t believe how robust this system is. Conceptually, I felt I understood it in the past but you just don’t get it until you trade it. And I am still amazed that the general market still thinks that you can only profit from stocks and commodities going up. At the same time I am profiting from that ignorance, so I am inclined to enjoy it.
“There is an unsentimental logic to markets. If you make a bad investment, you are supposed to pay the full price — because if you don’t pay the full price, you will keep making bad investments. The only way to get the bond market back to its historic role is to make bondholders feel real fear that they might lose money if they make bad decisions. We need the market to reward bets that are economically wise, instead of those that are politically savvy.”
Wonder if we ever get there….
Name: We will get back there because our government will run out of money like the Greeks’ government. Ours will be painful too.
