Rajesh Jain

WSJ reviewing “How Big Things Get Done”: “Mr. Bent Flyvbjerg identifies two common flaws in developing large-scale projects: inadequate planning and prolonged execution. Managers and politicians have a bias for action, he says, often treating planning as an annoyance that must be endured before the real work begins. Imposing tight deadlines for completion may end up adding costs and time, because the easiest way to craft a tighter schedule is to short-circuit the planning process. Rushed planning can result in problems that crop up later, generating delays that push up the cost. Thorough planning, in Mr. Flyvbjerg’s view, should be followed by quick execution: The biggest source of risk, he says, is low-probability events—black swans—that occur after the start of construction or implementation. This is the time when a pandemic, a burst of inflation, a labor dispute or a natural disaster can delay even the best plans and upend cost estimates. The way to mitigate the risk, he says, is to “think slow, act fast,” investigating the project carefully on the front end but then, following the decision to proceed, moving full speed ahead.”

Richard Fulmer: “The rule, “from each according to his ability, to each according to his need,” creates incentives to demonstrate minimum ability and maximum need. Poverty is the inevitable result.” [via CafeHayek]

Burton Malkiel (of Random Walk fame): “My view is that the case for passive is stronger than ever. More than half of fund assets are in index funds, and the reason for the success is that the evidence just gets stronger and stronger that index investing is not mediocre investing, it is above-average investing. I’ve done empirical work over the course of 50 years, and SPIVA [the S&P Indices Versus Active scorecard] has done work showing that over the past 20 years about two-thirds of active managers are beaten by the index, and the rough third of active managers that win in one year aren’t the same ones that win in the next year. Compound that over 10 years, SPIVA finds that 90% of US active funds underperform their benchmark index.”

WSJ reviews “Outsmart Your Brain”: “Memory retrieval feels hard at first, like failing to do a pushup. But that’s precisely why it works. You must build new muscle…Mr. Willingham counsels that although rereading notes and books are among the most common strategies for studying—they quickly render the material familiar and therefore feel productive—they are among the least effective. Better to prepare study questions and try to answer them. Memory retrieval feels hard and useless at first, like trying and failing to do a push-up, but that’s precisely why it works. You must build new muscle…From the chapter on staying focused: We all know the advice to work in quiet locations and silence our phones, yet some of us still try to multitask or quickly answer texts in the middle of a thought. We underestimate how long it takes to get back on track after switching attention from one thing to another.”

Economist: “Advertisers pay handsomely for access to Google’s users, not least because they are typically only charged when someone actually visits their website. The revenue of Google’s parent company, now called Alphabet, has grown at an average annual rate of over 20% since 2011. In that period it has generated more than $300bn in cash after operating expenses, the bulk of it from search. Its market value has more than trebled, to $1.4trn, making it the world’s fourth-most-valuable public company. Unlike Apple and Microsoft, its bigger middle-aged tech rivals, it has not felt the need to reinvent itself. Until now.”

Noah Smith (from 2020): “One of the scariest scenarios for the 21st century is that of a zero-sum world, where low productivity growth convinces people that the only way to get rich is at someone else’s expense. That sort of dog-eat-dog world would see intensified conflict and political instability. But cheap energy, even more than other kinds of innovation, offers the potential for the world to return to the sort of positive, future-oriented, growth-oriented, win-win culture that we sometimes managed to achieve, in some places, during the 20th century. It’s the future we thought we had lost, but which we might finally get after all.”

FT: “The more we use technology to insulate ourselves from the discomfort of asking questions, the more fearful we might grow about doing it face to face. One academic told me the vast majority of his students “are really up for it” but seem too nervous to take “that final step”. He got so frustrated by the silence in lectures he brought in one of his child’s soft balls and told them: “I’m going to chuck this out and whoever catches it has to ask me a question. Any question.” He says they looked at the ball like it was a hand grenade. Yet asking someone questions face to face can be the best way to make sure you really understand something. I have sometimes asked people to sketch diagrams for me too. This matters if your job involves clear communication — otherwise you can end up regurgitating technical terms because you don’t have the confidence to put them into plain language…Fear of looking ‘stupid’ holds us back from understanding the world better.”

BCG: “The success of any Web3 loyalty offering will entail pairing utility to issued tokens. The utility spectrum can span physical, social, or pure digital utility. Physical utility involves coupling access to real products and services to the digital asset, such as an NFT that grants access to a redeemable product. Tokens can also have social utility in the form of access to community events, VIP benefits, or exclusive brand voting rights. Digital utility extends privileges and access to the digital world in the form of metaverse events, virtual meetups with brand ambassadors, or in-game use of tokens.”

Sam Harris: “I’ve learned about the power of incentives, because as much as I’ve wanted to get back to writing books, having a podcast has shown me that–this won’t surprise you as an economist–but like virtually everyone, I am a creature of incentives, and all of the incentives are aligned away from writing books at the moment. Podcasting is easier, I reach many more people, and it’s a better business. So, for me to go back to writing and embrace the opportunity cost of writing at the moment, I really have to decide, ‘Well, I don’t care about doing the harder thing. I’m happy to do the harder thing. I don’t care about reaching fewer people. I don’t care about it taking much longer to reach those fewer people. And, I don’t care about losing money.’ So, all the incentives are wrong for writing my next book…I think I will ultimately do it, because I think writing is just a muscle. As a thinker, you need to work and you really don’t think as clearly as you can unless you’re writing your thoughts and finally producing the sentence that you think is the best version of any specific thought.”

Mint: “Not so long ago, in the 1990s, travelling in air-conditioned coaches was considered a luxury by India’s middle class. And then came the game changer: AC three-tier coaches, which promised AC travel at affordable prices, which married the comforts of AC travel with the economy of the humble sleeper class. It demonstrated how price-sensitive the Indian market was. This story played out in the Indian skies as well. India’s fast-growing middle class embraced low-cost airlines (perhaps the equivalent of AC three-tier trains) that promised relatively affordable air travel. The steady growth of Vistara seems to suggest two things. India’s fast-growing middle class – which may already be the size of the US population – has begun climbing up the value chain. It is a consequence of the economic boom and the steady rise in standards of living after 1991.”

Graham Duncan: “How close to that 10 can you get when you’re first getting to know someone and deciding whether they are a fit for your team? When I started making those sorts of judgments about people, I’d guess my average was a 3. I’ve since done thousands of interviews, spent just as many hours talking to references, and helped hire hundreds of people—as consultants for a research firm that I helped run right after college, and since then as analysts and investors in my role investing large pools of capital.  Now, when I’m in the zone and the conditions are right, I think I can sometimes get to a 7. A lot of people, in my industry and others, see all of this as a drag, a distraction from the central mission of their team. But I’ve come to consider it the most important skill for anyone building teams—and to believe that, to the extent I have any unique skill, this is it. In the work context, managing the complexity around people is the most important skill for anyone building a business. As the gaming company Valve puts it: “Hiring well is the most important thing in the universe.”” See the reference guide at the end.

Shankkar Aiyar:  “An abiding truth about governance in India is that it excels in projects – whether it is Jan Dhan Yojana or rural electrification — but struggles to reform processes which determine efficiency. The crux of success rests in the alignment of national goals with systemic reforms in the states to propel growth. A mystifying paradox is at play in India’s political economy – of attention and inattention. There is much debate and audit of the Union Budget and almost none about the budgets of state governments.”

Jeremy Tate: “Socrates never wrote a term paper. Active participation trumps essays in classical education….The more permanent fix would be to rethink the way teachers judge a student’s mastery of classroom material and come up with an option that doesn’t rely on essay writing. The essay hasn’t been banished from classically minded institutions. Rather, the more personalized, discussion-centric model of instruction by its nature renders essays a secondary tool. Students that skip their homework won’t be able to hide for long when asked to offer an opinion on last night’s reading. For centuries, the classical curriculum was the norm, rather than the exception. In the modern era, however, the march toward factory-style education replaced the old ways with more specialized studies delivered in lecture form. Perhaps it’s time to rethink this change. The classical method survived as long as it did because it fostered critical-thinking skills that can then be applied to any category of specialized study.”

Dallas Innovates: “John Carmack, the iconic Dallas game developer, rocket engineer, and VR visionary has pivoted to an audacious new challenge: developing artificial general intelligence—a form of AI that goes beyond mimicking human intelligence to understanding things and solving problems. Carmack sees a 60% chance of achieving initial success in AGI by 2030.”

Pramarth Raj Sinha: “India needs its best minds to work on and significantly impact the world’s toughest problems. For this to happen, our best faculty and students need to carry out cutting-edge research. Unfortunately, teaching and research have often been delinked in our country, despite the fact that it is research excellence that powers teaching excellence, and vice-versa. New thinking and insights from research-active teachers create an engaging classroom experience. In turn, inspired young minds are motivated to research solutions to intractable problems.”

Miklós Dietz: “This is the single largest economic transformation in the history of the planet. For ten thousand years, everything—the whole economy—was organized across traditional industry lines, and now it’s breaking up. It’s getting reorganized across customer needs…People don’t want a mortgage. They don’t want home insurance. They don’t want a real estate agent. They want a home. Of course, historically and traditionally, we have forced people to go to six different places to line up and fill out hundreds of pages. Our belief is that the future is about delivering what people need: if you need a home, you will basically only need to find one process through which you can find the right place, get it financed, move in, renovate, and even sell it—all in one glorious and integrated journey.”

NYTimes: “The most compelling reason for taking a brain break is that it may improve your ability to do quality work. A 2022 systematic review published in the journal PLoS ONE found that even short breaks lasting 10 minutes or less reduced mental fatigue and increased vigor (meaning the willingness to persist when work became difficult). These breaks especially improved performance on tasks requiring creativity and less so for activities like basic arithmetic. The analysis found that the longer the break, the better the performance boost. Since few of us can take unlimited breaks, the trick is to use the time you have wisely — even if that means ignoring your boss’s dirty look as you fiddle with a Rubik’s Cube.”

Warren Buffett: “When leverage works, it magnifies your gains. Your spouse thinks you’re clever, and your neighbors get envious. But leverage is addictive. Once having profited from its wonders, very few people retreat to more conservative practices. History tells us that leverage all too often produces zeroes, even when it is employed by very smart people.” [via Mohit Satyanand]

Bill Ackman: “I’ve always had this view that success is not a straight line up. If you read the stories of successful people, almost every successful person has had to deal with some degree of hardship, whether that hardship is personal hardship, health-related hardship, or a business issue. I’ve always had the view that how successful you are is really a function of how you deal with failure. If you deal with failure well and you persist, you have a high probability of being successful.” [via Shane Parrish]

Jitha Thathachari: “When it’s 10x easier to fake it than to make it, fakes will always outnumber the truth…The general principle is: When it’s easy to showcase a veneer of “work” without doing the work itself, then 99% of the work you see will not be real. When it’s easy to generate content without writing it yourself, then 99% of content will be AI-generated. And if 99% of content is AI-generated, you’re better off assuming that 100% is AI-generated. When you see any content online, the default assumption will be: this has been written by an AI. This won’t happen tomorrow. It might not happen for the next three years. But inevitably, it will happen. The Internet will become “a market for lemons”.”

strategy+business: “There are missions, and then there are missions. One type of mission is an achievable task with a fixed goal that is often tactical and short-term in nature. The other mission is a high-level aspiration that provides direction and motivation to an organization over a long period of time. Leaders who mix up the two can put the future of their companies at risk…Don’t mistake a goal—no matter how big, hairy, and audacious—for a compelling organizational mission. You can achieve a goal and put it behind you, but a mission is always up ahead and just beyond your reach.”

Shane Parrish: “To win, you have to avoid losing. The first thing chess masters do after an opponent makes a move isn’t to think about strategy or winning but rather to ask themselves: what’s the threat? Avoid stupidity before seeking brilliance.”

Noah Smith: “Why is India the most important development story on Earth? Two reasons. First of all, sheer size; as of this year, India is the world’s most populous country, overtaking a now-shrinking China…I have to say I’m optimistic about India. Development seems to have a momentum that’s as much psychological as economic — once the people of a country know that they can achieve rapid growth, their hunger is whetted for more. The reforms of the 1980s and 1990s didn’t get India all the way to developed status, but they gave Indians a golden 25 years during which they started to realize just how great their country could become. And I think much of the rest of the world realized it as well. So now is the time to keep pushing, with bold, persistent experimentation.” This is part of The Developing Country Industrialization series.

NYTimes: “Perhaps you spend hours replaying a tense conversation you had with your boss over and over in your head; or maybe you can’t stop thinking about where things went wrong with an ex during the weeks and months after a breakup. If you find that your thoughts are so excessive and overwhelming that you can’t seem to stop them, or if they’re so distracting that you’re falling behind on responsibilities at work or at home, you’re probably experiencing rumination, said Dr. Tracey Marks, a psychiatrist in private practice in Atlanta. While rumination is not a mental health condition, it can be a symptom of a larger problem. And in some cases, it can become so encompassing that it requires intervention, Dr. Marks said…What matters most when it comes to rumination is how your thinking makes you feel, Dr. Marks said. If your thoughts are causing distress, anger or anxiety, or if your rumination is pulling you away from important things in your life, that is when it’s a problem.”

Michael Munger: “Capitalism, however, also creates concentrations of economic power because of the ability of successful investors and entrepreneurs to gather large amounts of wealth. Ownership in a capitalist system is both the mechanism for raising liquid capital—by selling shares that are claims against the value of future profits—and a means of controlling substantial resources independent from state direction and control. The private ownership of tools and materials that characterize a market system are on a much smaller scale than the ownership of land and a controlling interest in the shares of joint stock corporations. Nations that do not have the corporate form of private ownership are likely to run up against capital constraints, as it is difficult to generate liquidity on a scale, and in a time frame, that allows the successful exploitation of profit opportunities.”

WSJ: “Mr. [George] Will is fond of an old joke: The first law of economics is, scarcity is real; the first law of politics is, ignore the first law of economics. “Everyone’s agreed on that,” he says. “They say Social Security’s trust fund will be exhausted in 10 years, at which point there will be a mandatory cut of 18% for all benefits. No there won’t. We’ll use general revenues, we’ll go on borrowing.” He ends this polite tirade against the political consensus with a perfectly Willian formulation: “People always ask, ‘What’s the biggest threat to American democracy?’ The biggest threat to American democracy is American democracy. It is the fact that we have incontinent appetites and no restraint on them.””