Dopamine Culture

On My Mind | 2024.03.08

Happy Friday! I hope things are off to a good start.

On Monday, I expect to send out a single-topic post, so keep your eyes open for that.

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On My Mind

I’ve been reading about the lead up to the Great Depression — and there was a lot happening ahead of 1929’s Black Thursday. Events such as a Florida land price boom, massive increases in margin debt across the country, special purpose acquisition trusts that raised money while not yet owning assets, and a spike in “average joe” participation in the stock market — which are fortunately very unfamiliar sounding events to modern ears… — make for a complex story of tangential cause-and-effect.

Fortunately, some writers are skilled at distilling complexity into the approachability. For me, John Kenneth Galbraith may be top of the list in that regard. And he does more than simplify the complex — he also writes simply. Somehow, he manages to weave a bit of character into his words as well.

I have so enjoyed re-reading The Great Crash 1929 that I found myself spending more time analyzing Galbraith’s writing style than the topics about which he writes. This happens to be a terribly ineffective way of quickly writing a post about the Great Depression. Alas — I cannot help it. Galbraith just writes so well.

This has got me thinking about my approach to communicating complex ideas within the office. I tend to write rather lengthy sentences. I am a fan of having more than a few paragraphs to set the stage. I ostensibly do this to add context and prevent miscommunication.

Unfortunately, miscommunication still happens more often than I would like. The extra words are not the remedy for misunderstanding that I wish they were.

Maybe the remedy would be, in fact, less words.

Quote of the Week

Nothing so undermines your financial judgement as the sight of your neighbor getting rich.

— JP Morgan

Charlie Munger said he tried to avoid feeling envy as it corrupts a person’s ability to make decisions. Doing so seemed to work — in concert with other character qualities, obviously — as he was worth somewhere between $2 and $3 billion when he passed away. That’s a lot of uncorrupted decision making.

Munger also believed that “the world is not driven by greed; it is driven by envy” — an interesting juxtaposition. If a person should avoid the thing that “drives” the world, you have to start to wonder if the world is traveling toward the right destination.

On my end, I know that one of the fastest ways to find myself in a negative head space is to focus on what I lack through the lens of what someone else has. It most definitely degrades rational thinking.

The above quote was surfaced by writer Morgan Housel on Twitter.

Poll of the Week

On an average day, how many hours are you in front of a screen?

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  • Last Week’s Results: Thank you for all the replies to last week’s poll; based on some back-and-forth with Beehiiv, it seems there was an analytics outage a couple weeks back. I should continue to get your results going forward!

Things to Read

Dopamine Culture | From How to Break Free From Dopamine Culture by Ted Gioia, 2024

If you look at the 10 largest companies in the world, half of them are trying to create this addictive relationship to technology. The days when the dealer in addiction had to hide in the shadows are over. They now operate freely in your home, and every other sphere of your life…

These businesses are obsessed with controlling users in the most manipulative ways possible. This is not the purpose of tech. It has never been the purpose of tech—which should empower and enhance our lives, not force us into digital bondage.

I’ve never used a dating app. I met my wife before they were invented…

Well — I should say I have never used a dating app for me. I’ve happily scrolled through infinite reams of potential dates on friends’ phone — swipe, swipe, swipe — for the experience. It’s addictive. You get in a groove. And you keep going — swipe, swipe, swipe.

Importantly, that swiping is exactly what the dating apps want. They need your attention. They don’t actually need you to find a date or life partner. It would be worse for them if you did. You would be like me — married and never swiping.

What you think is being sold — potential partners — is not actually what you are buying. You are buying swipes. And you are paying for those swipes with your attention.

Ted Gioia dives into the negative loop that is created by a person trapped in this swiping culture — and shares some ideas on what you can do to get out of it.

Efficiency | From Leverage by Larry Jamieson, 2024

Probably the first thing that comes to mind when you think of ‘leverage’ is financial leverage. The predominant form of financial leverage is, of course, debt. There’s a time and a place for debt, but there are many other forms of leverage, and certainly other forms of financial leverage.

The more useful understanding of leverage in this context is the ability for a relatively small unit of input to create disproportionately larger output. In this way efficiency and leverage take on a similar meaning.

Naval categorises the main forms of leverage as: technology-enabled leverage… media-enabled leverage… financial leverage… and labour leverage.

For those of us in finance, it is easy to immediately think about debt when we hear the word “leverage.” This is a myopic view of the concept.

There are many ways to “gain leverage” whether in your business or personal life. Not all forms are as dangerous as financial leverage. In fact, some leverage has no enhanced downside risk at all, which Jamieson explores.

Don’t Trick Yourself | From The Dumber Side of Smart People by Morgan Housel, 2024

How could someone possibly be too intelligent? How do you get to a point where you realize you could have been more successful if you had been a little dumber?…

The biggest risk to an evolving system is that you become bogged down by experts from a world that no longer exists. The more evolution you have, the more you should expect that expertise has a shelf life. And those most susceptible to that risk are the people you’d least suspect: The smartest and most intelligent, who at one point flashed their brilliance but struggled to admit that it can’t be repeated

It is easy to fall in love with your own ideas, especially if those ideas have benefited you in the past. However, love is blind, as they say, which makes the infatuation dangerous in a complex, changing world.

Humility and a desire to hear different, new perspectives can prevent you from trapping yourself in a walled garden of your own dated ideas. However, the more intelligent you are — or think you are — the more likely you are to build those walls.

To quote Richard Feynman, “The first principle is that you must not fool yourself — and you are the easiest person to fool.”

Losing Money to Change the World | From The Rise and Fall of the Telecom Bubble by Doug O’Laughlin, 2023

Semiconductors are the public market picks and shovels for the AI boom, much like Telecom was viewed as the picks and shovels for the Internet…

The telecom equipment providers were on the other side of the network. Companies like Cisco, Ciena, Lucent, Nortel, and others were desperate to sell equipment to the frenzy of telecom companies building networks and laying fiber…

This is one of the largest bases of capital ever built in such a short amount of time, and this capacity led to a glut in fiber that took almost a decade to backfill. But I’m getting ahead of myself.

… In today’s analogy, they are the companies most similar to the semiconductor companies selling chips to AI companies…

It’s hard to go through an entire day without hearing a new promise of the future value AI will bring humanity. Just as hard to miss are the calls for money to fund everything needed to be built to bring about that foretold value.

In the 1990’s, inescapable euphoria focused everyone on the better future the internet was destined to unlock. And people were right. The internet did change the world. But, a lot of money had to be lost for that change to happen, which gave us the less-than-foundly-remembered Dot-Com crash in the early 2000s.

So, will AI change the world? It seems like it has a better shot than most new things to do so. But, is it inevitable that money will be made by those investing in the infrastructure to build it?

If the telecom industry of the 90s serves as any sort of guide, we all need to tread carefully.


COVID permanently changed consumer habits (@LiberyRFP)…

Technology can come at you fast: historical productive per acre of ag land (@OurWorldInData)…

Comments from 1901 on behavior in financial bubbles (@InvestorAmnesia)…

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Have a great weekend,


Twitter / X: @HistoryEJ

Disclosure: Nothing in this article constitutes investment advice. More detailed disclosure here.

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