Hi, All:

I'm working on creating a holistic blockchain heuristics course and I keep going back to this talk by Jill Carlson that we saw when we were at the "Bitcoin is_" conference in 2019, hosted by Russell Okung (yes the NFL football player) because it really hits the nail on the head on the question of:
​

1. Why blockchain? 
2. What was the landscape and catalysts for the emergence and evolution of blockchain?

For almost everything, I'm a big believer that the context, the journey, the how we get to our destination matters just as much, if not more, than the end result. Integrity. Satoshi Nakamoto, whoever or whatever you are, thank you for your contribution to humanity.

Had my assistant help us transcribe Jill's talk, so for anyone that has any accessibility issues with hearing, hopefully that helps. The talk was so good. Actually, that whole conference was just amazing and well produced (Thanks to George M., and Russel O., - go #Seattle!). 

--Arry 

Conference: "Bitcoin is ___"
Speaker: Jennifer Carlson
Title: Who is Satoshi Nakamoto?
TRANSCRIPTION of above video below here.

I'm really, really excited to introduce you to our next presenter who is going to cover one of the most important topics of Bitcoin. In the eToro Lounge, you will see the white paper, the Satoshi white paper that is now a part of the legend of Satoshi. So, it's in there, you can read it if you haven't. I'd recommend reading it multiple times, but with that, I would like to introduce you to Jill Carlson to talk about the legend of Satoshi Nakamoto. 

Thanks. It's awesome to be here. So I'm going to be talking about one of my favorite topics within Bitcoin. And it's one of my favorite topics because it sounds like a book. It sounds like a movie. It sounds like something out of the Da Vinci Code to me. And the most important thing to understand about this is that it's real. Everything I'm about to tell you is true to life how this played out, what the origin story of Bitcoin was.

I'm going to talk about Satoshi Nakamoto and the origin story of Bitcoin. Now, as Alex Gladstein, Jimmy Song, and the guys who were last up mentioned a few times, Bitcoin has no controller. Bitcoin has no one who is a central authority who's making the decisions around how it should be developed, how it should proceed. It is fundamentally, truly decentralized and that dates back to the very beginning of it. And it's very important to understand how it came about, how this could possibly be. 

And so, in order to understand this, we need to go back in time to the Fall of 2008. October 31, 2008, it was Halloween, eleven years ago. Take yourself back there. Now, on October 31, 2008, there was a paper that got published that we've mentioned already - the Bitcoin white paper. And in that white paper, there was presented for the first time, a solution to a problem that had existed for a while. That problem was how might we create a peer-to-peer electronic cash system. 

Now, we might be sitting here and saying, "Well, okay. But I kind of already have electronic cash. I have my Bank of America app on my phone, I have Venmo, I have PayPal. Why is this different?" 

This is different because what we talk about when we talk about Venmo for example - there's nothing wrong with Venmo, I use Venmo everyday - but, with Venmo, I'm relying on a third party to make that payment which is very fundamentally different from cash. If I send you $20 on Venmo, that transaction has to be routed to Venmo, back to my bank, back to your bank. There are all of these different parties and players involved. Whereas if I pull $20 out of my pocket and hand it to you, who else is involved in that transaction? No one, right? And that becomes very important when we think about the distinction between cash and just money. 

And so, here for the first time, in this paper, we had electronic cash invented. Now this paper was published and it wasn't published by a research university, it wasn't published by a government agency, but rather, it was released to an email mailing list called the cypherpunk mailing list. And so here we actually have the original email that Satoshi sent presenting Bitcoin P2P e-cash in this paper or the Bitcoin white paper. And again, it's important to note here, the way that he chose to release it was to this pretty niche mailing list on a random corner of the Internet that had maybe gotten a lot of traction back in the 90s and we'll go over in a second sort of who the folks on this mailing list were and why he might have chosen to release it in this format to these people. 

But he did. That was an intentional choice that he made to release it on the cypherpunk mailing list. And so then, we move on and we ask okay, well so who is this 'he' that I keep talking about? Who is Satoshi Nakamoto? Who is this author of this white paper that solved the problem that, again, had been around for a long time, that many great mathematical minds, that many great cryptographers etc had set out to try to explore. 

And the answer to that question is where, again, I think this starts to sound like a mystery book because we don't know. To this day, we don't know who it was who managed to solve this problem. That is wild if you think about it because if you think about other folks who publish under pseudonyms, for example. Authors. Artists. Very often we have some idea of who they are or they were just using the pseudonym as just kind of this is my professional life and then I'm keeping my personal life separate. 

But with Satoshi, there is not a trace. There is his online persona, he published this paper, again, to this mailing list. No one on the mailing list had ever interacted with this Satoshi before, with Satoshi Nakamoto. And in fact, the first people who started responding to him didn't even think twice. They didn't question who you are or where you came from. It wasn't until weeks, even months down the line that he started fielding those questions and he was always sort of very cagey and shy and didn't reveal very much at all. And then only later did it come out that actually no one exists. Satoshi Nakamoto does not exist in the form, at least, that he was presenting to the world. 

And then finally - so he publishes this white paper to this mailing list and very quickly on the order of weeks and then months he followed it up with working code and he performed the first Bitcoin transaction. And there are a few things that are important to think about there because that tells us something actually, about who Satoshi was. He's someone who could program. He wasn't just sort of an armchair philosopher coming up with these ideas and presenting them out to the world. He was actually programming and creating the source code that would enable this vision that he had for the future to become possible. 

And so he performed the first Bitcoin transaction on January 3rd, 2009, a few months after he had first released the white paper. Pretty quick turnaround time, actually. He performed the first Bitcoin transaction and he timestamped that transaction by publishing within the transaction the headline of that day's London Times. And here you can see it over on the right - The Times 03/Jan/2009.

Now, let's take a step back and think for a moment here because what I've just presented to you is pretty wild. Again, it sounds like something that is borderline hard to believe that this is actually how it played out. That this isn't just some origin myth narrative that we've come up with to sort of kick up some interest in this product and in this space. It's all true, though, but what I would suggest, what I would propose here is that it actually was very intentionally done for a whole number of reasons. That none of this was an accident from the timing to the format in which he released it, to the distribution strategy around it, who he was, who he presented himself as, and then finally, the kind of branding that he created around this new currency, this new technology, this new product. 

And I wanna again, take a step back here and think about the fact that we spent so much time in the Bitcoin space thinking about the technology, the technology that goes into Bitcoin. As we should because there are major breakthroughs that have occurred based on what Satoshi was able to put together for the first time. Again, he solved this unsolved problem. 

But if we look at this timeline up here, we can see that actually, a lot of what went into Bitcoin, those components massively pre-dated Bitcoin going all the way back to the 1980s. There were all of these developments that happened along the way in terms of the technologies that were needed to be able to create Bitcoin. And really, what Satoshi did on the technology front, among other things of course, was he assembled these technologies for the first time in such a way that he created something new and he created this peer-to-peer digital cash. But should we spend so much time in this world, talking about, thinking about the technology aspect? But what I would propose is that we spend not nearly enough time talking about basically the marketing strategy, actually, that Satoshi created around it because Satoshi's brilliance was not just in creating the technology, but it was also in how he presented it to the world and how he sparked people's imagination with it. 

And so with that, I want to briefly dive into a few of these areas. So I mentioned he created it on October 31, 2008. That's not quite right, though, right? He didn't create it then. That was when he chose to release it to the world. He chose that date. Now why would he choose October 31, 2008? There was a lot going on in the world at that time. Philadelphia had just won the World Series, Barack Obama was on the verge of being elected President, but you may also recall we were in the midst of a global financial crisis. 

So who here remembers where they were in 2008 when Lehman filed for bankruptcy? Who feels like they were affected by it in some way? This affected everyone in the United States, everyone in the world. And suddenly, for the first time, people took a step back and started scratching their heads at the financial system. If big investment banks could go under - and here we have a picture. This is the Lehman Brothers sign being brought into auction at Christie's to be auctioned off in order to raise capital, actually for the bankruptcy filing of Lehman Brothers. 
If we can have banks going under, if we can have governments bailing out those banks and creating, really, a moral hazard around the bankers who made poor decisions around risk that set off this chain of events, this cascade that impacted every single one of us in this room, people were starting to ask these questions for the first time. And they were mad about it. 
Occupy Wall Street. I was actually working on Wall Street at the time the occupy movement started happening and I would walk past everyday the protests occurring because people were mad as hell that the banks were able to be so irresponsible and governments were able to come in and bail out those banks while Mom and Pop had to lose their jobs, lose their pension funds. 

And so what I would challenge you to think about here is October 31, 2008 Satoshi releases the Bitcoin white paper. Why? Not because that was the date where he finally felt like he cracked the code of the technology, but because he knew that the timing was finally right to release this to the world, that people were asking the right questions that would enable them to understand this. So there we have the timing, the question of timing. 

The next thing I wanna talk about here is the question of who he released it to, why, and in what format most particularly. So I mentioned this word, "white paper". Everyone in Bitcoin loves to talk about the Bitcoin white paper. The Bitcoin white paper this, the Bitcoin white paper that. I had never heard the word "white paper" before I got into the Bitcoin world. Not actually a normal thing to be talking about, it's not actually a normal tactic and marketing etc. Now why did he choose this format to release it in? Well, actually the origin of "white paper" actually dates back to the early 1900s in the UK (United Kingdom) when white papers were used as policy proposals and they sat in this kind of interesting middle ground where they were policy proposals. They were intended to be used as tools somewhat of democracy to solicit feedback from people on the policy proposed there. And so there was this very all encompassing, democratic, high value placed on an individual freedom's format to be able to have a discussion. 

Interestingly - of course, this format has been picked up by universities and academic research and some other technologies in the meantime, but nonetheless, I think that it's really worth thinking about why did he choose this format - the white paper - and does it have something to do with the fact that he was soliciting feedback. He wanted this to be an inclusive process, an inclusive conversation and I would say yes, that is probably exactly what he was thinking. 

And so, we have the Bitcoin white paper, but as I mentioned before, we also have code. Satoshi didn't just put the idea out there and say, "Alright. No you guys take this and run with it or go and try and solve it." He said, "Okay, I'm also going to sit down and implement this. I'm going to pull some other people in and we're gonna try and build this damn thing and do some transactions." 

And that's exactly what he did. And there, he's tapping into a slightly different ethos from what he did with the white paper. He's tapping into an ethos of create, ship the code. And I want to come back to the importance of that because we might think about oh you know well this just kind of make sense for him to put the idea out there and then tinker around and try and build it, but even the fact that there was lag time between when he released the white paper and when he build the first version of the code. That's important because that made it such that he could get feedback from the community that he was presenting it to before shipping and releasing the first version of it. 

And now we want to talk about, of course, who he released it too. And this is where I think it gets very interesting again because I mentioned already the cypherpunk's mailing list and I want to talk about who the cypherpunks were. They were an activism community that really gained traction in the 1990s, really focused on privacy, individual rights, individual rights online, freedoms, all of these themes that we see crop up in the Bitcoin white paper. And cypherpunks had actually been working on this problem of how to create digital cash for years and so, you can think about the different ways that Satoshi might have gone about trying to present to the world this new idea. He could have gone and filed a patent. He could have approached a government agency and said, "Hey, I think I'm really on to something here." But instead, he took it to this community that he trusted to be the stewards of this - the cypherpunks - whose values he had some degree of certainty around in terms of the privacy and the individual rights aspect. 

And then finally, the last thing that we need to talk about is of course, the branding around it and so we've covered the timing, the creator, his distribution strategy, the format that he released it in, but what I would say was actually the masterstroke of this whole thing was his ability to see how he could plant, basically, an Easter egg in the middle of this. So, I talked a little bit earlier about how he embedded in that first transaction that he did, a headline from the London Times from that day. He did that for two reasons. He did that to timestamp it, but also, what that headline was, was no accident. 

That headline read, "Chancellor on Brink of Second Bailout for Banks." And that was indeed the headline on January 3rd of 2009, but that was also a political message. That was a political message saying look at the money that you have today. Look at where it's got us. It's gotten us into crisis. It's gotten us into a situation where we have banks and institutions who can use that money in ways that hurt us. It's gotten us into a situation where governments can bail out banks and what if we imagined a world in which that were not possible? What if we imagined a different type of money? And that's what Satoshi was presenting to us. 

And so, I wanted to share this story with all of you today because I think that it's really important to consider not just the technology behind Bitcoin, not just to consider the technological breakthroughs that Satoshi made in order to make all of these possible, but to also think about all the other decisions that went into it - as he was releasing it, as he was developing it - that got us, really, the magic of Bitcoin that we have today. 
​
Thank you.

 Hi, All:

I was asked if I could make time to go to this webinar this morning (9-10am), and I could, so I did, and of course, I took notes. I always take notes. And I'm continuing to share them - so hopefully they are useful to someone out there. I have to say, I saw Danielle DiMartino Booth in an interview for the first time last week - and was superbly impressed. Today, she went from being a self-proclaimed "old timer" who hedges with GLD (Gold) - to someone who might finally understand the great big case for BTC (Bitcoin). WOW. And Jeff Booth did an amazing job building up the case and really pushing for logical thinking and thought experiments. Now, I am following @JeffBooth - as I am also a newly minted fan.

Here are their bios for reference (I don't think they are related.):

• Jeff Booth: https://www.jeffreybooth.com 
• Danielle DiMartino Booth: https://dimartinobooth.com/bio/

Feedback welcome on the notes. Too much? Too little? Different format? Let me know! And here's the link to the full interview: https://blockworksgroup.io/ia-inflation-vs-deflation?SQF_SOURCE=webinararchive 

​--Arry 

These are my personal notes from attending conferences/webinars/talks - and this one is from this past weekend in watching a couple sessions from the Trading Investment Summit: Investing Notes: Lyn Alden 9/26/2020. I recently started following Lyn on Twitter too - after discovering that some of my favorite investors also follow Lyn, so thought it'd be a good opportunity to catch an interview live to learn a little more about her perspectives. 

Here's a link to her BIO, with some additional resources she's created.

Hope this helps! (And feedback always welcome.)
​--Arry 

Lyn Alden Interview

Lyn founded LynAlden Investment Strategy. Free newsletter every 6 weeks. Engineering background. Started investing before studying as an electrical engineer. 

How has the banks/markets responded to Covid? What’s your view on this, esp regarding employment/supply chain? ——> April 2020 - looking forward square root sign curve regarding employment. Falls, small recovery, then will be a very slow recovery. So far, that’s what we will see. We have a credit cycle playing out - permanent job losses are happening. Going forward, this will be an issue. Fiscal policy is what to watch out for - will dictate how “K shaped” this will be. If you see more fiscal, you can see a narrowing of the K. 

How to get this trickle down effect of QE over these years. Helicopter money into people’s accounts has a good short term effect. ——> Central bank have been trying to address this problem of the global financial crisis - we have had low rates for so long, so it is miss pricing risk. Negative rates destroy the economy.  It’s an over reliance on monetary policy - it’s like the 30s-40s. We need more fiscal policy - in the 40s, that’s what happened after the war. Lot of the deficits is tied to structural, an aging demographic. Fiscal versus monetary policy. This recessions we got a lot of direct to consumer earlier. Now it comes down to what happens next. We’re in a normal recession right now.

Apple issuing debt even with their cash pile of billions. Is it sustainable for low rates? It’s good for real estate, taking out low 30 year fixed rates. It’s good for stocks. But what else? ——> Whole yield curve is so low. Looking at the long term debt cycle, in a typical biz cycle, you might get more leverage in the system, then you get an external catalyst, and then a small recession. Then monetary policy comes in and ends it. Over multiple short term multiple biz cycles, then you’ll get more debt in the systems, … then you get lower interest rates, then you hit zero. The last time we hit zero bound was 1930. This will be a big deleveraging event - but they play out differently. Very challenging time for markets. Not a lot of safe havens right now - because they are not good places for holding right now. No safe haven to put your money right now. 

The FED has announced a symmetrical period… how will this affect the dollar. Interest rates will not be volatile because central bank will hold. You’ll get more currency volatility. 1940s, when we were getting off of 0 bound, they said won’t let the 10 year yield go above 2.5%. Inflation reached double digits - it was inflationary and contained. In 2020, we’ll see a scenario like that. They will cap treasury yields - and let treasury underperform. We’ll come down to fiscal policy. Central bank will put the breaks on it - so it’s all about fiscal policy. 

How calculating inflation has changed so much. Inflation is basically which is reported is different. Central banks changed different from tightening to easing pretty quickly. The pain problem is the debt - everywhere, not just the US. So much debt - how will central banks get out of it? —> Long term debt cycle will be done by inflating a large chunk of the debt away. It’ll be like 1940 — they capped yield below inflation rate. You get all of your money bank nominally - but you lost 30% off your purchasing power. We’ll be in that period. We’ll get inflation. Real yields will be negative for awhile. Over the next many years, negative real yields. 40 year period from late 1930s to mid 1970s, you mostly failed to keep up with inflation. We’re in that situation. Yields are so low - only short term trades is where you might gain. 

Look at total debt to money supply — our debt is building up nominally, but it peaked in 2007 and has been in decline because of the money supply growth faster than debt. US came out of the 1940s as the only country as the global creditor nation with a large industrial nation. Now it is the largest debtor nation. This one is different. People point to “Japanification”. It’ll maybe stagnation? Japan is currently is the world’s largest creditor nation - they own more foreign assets than foreigners own their assets. That’s not our case. I’m in the dollar-bear camp. Over the next 10 years, the dollar will lose value against some major currencies. Japan also owns a lot of their own debt, btw.

Since we had massive QE, zero rates - have we seen inflation? QE and zero rates are more deflationary. Housing going up Disposable income has been getting reduced of the average person - because most people don’t have all these extra assets. Thoughts? ——> Some extent. View a similar outcome from a different lens. QE mostly props up asset prices. Fiscal policy working with banks - that’s more generally inflationary. Need to point more to fiscal policy. This happened in the 1930s, you didn’t see broad price inflation until 1940s where they saw the broad price inflation. Fiscal policy more than more central bank monetary policy.

1930s we had twin budget surpluses in the early 1930s, The starting point was positive. We have twin deficits right now going into this. ——> This is more of a inflationary variable. We have slower population growth. Rapid tech growth. Deflationary forces, that are offset by trade deficit, debtor nation, etc…. More vulnerable currency than back then. Over the next 10 years, we’ll see the dollar decline (maybe more 5 years). Depends on more fiscal policy. It might go down to the “70s”. It’ll depends on fiscal policy between all the countries. 

Fiscal policy that leads us to the most event of the year, the US elections. What is a risk-positive or risk-negative outcome? Trump with Senate Red, House Blue = lot of things can happen. Depends on the decisiveness of the election. You’ll get large deficits no matter what. Size of deficit is all about the gridlock. There will be a volatility period. 

What is the breaking point? The confidence level? Where’s the limit? ——> FED is trying to do tightening. Domestic balance sheets are tapped out, even with the deficit oof 5% of GDP. Now QE happening to buy treasuries. We’re getting into a fiscal issue. We can’t float the treasuries to the foreign sector. Much slower rate of purchase than before, so we are self-funding them. These deficits are not going away anytime soon. You’ll still get large deficits, the central bank buying a large amount of it. If you look into 2021-2023, that narrative will change with so much deficit.

One of the most popular asset classes, Gold, Silver views on the next 1-2 years? ——>. 1 year I’m neutral. Out 3 years, I’m bullish on it. I turned bullish on this back in 2018. It’s really correlated to real interest rates. Sentiment layer on top of it. Real rates are less negative than 1 month ago. How well gold does really depends on stimulus? Are we getting disinflation? Inflation? How big will the stimulus be? Especially for the middle class. The wealth concentration (like the 20s-30s), …. Part of the inflation debate will depend on middle class, this is key. History repeats itself. 

Dollar losing its reserve currency status. What’s your view? Will this happen? ——> Good question. Most people ask the wrong question? We are at the point where there is no one currency that can do this. This is a weird period in history. Previous periods didn’t have such a lock globally. The dollar since the 1940s have been in a super entrenched position. After WWII,US was 40% of global GDP, rise of emerging markets, …. The US is now 20% of global GDP. We’ve run many large trade deficits. We exported our industrial base and our currency to the world. US used to have 80% of the world’s global GOLD reserves. Going forward, the trick is not to look for which currency will replace the dollar. You could have regional trading currencies. Trade between Russia and China, used to be 80% of dollars, but now it’s got more Euro. But Russia/China are antagonist towards the US. A handful of currencies will be used to price commodities. Going forward, central banks buy less gold/treasuries. The dollar will be A reserve currency, not the ONLY currency to price commodities. Just a part of the system.

These are my personal notes from attending an interview with Danielle Booth today: Investing Notes: Danielle DiMartino Booth 9/25/2020. I think my fingers got a major workout for the 45 minutes she was being interviewed trying to type/write as much as I could from what she was saying. Super smart, savvy woman who obviously knows her stuff and does not apologize at all about her opinions. The "Speak Truth to Power" type of stuff - which I'm a personal big fan of. In a sea of men that were presenting today at this 3 day investor conference, it was so refreshing to see and hear her. 

Took a screenshot (sorry, not the most flattering I know if you see this Danielle) - see below. Here's a link to her bio too.

Anyways - hope these notes are helpful. Feedback welcome. Normally I wouldn't be sharing my notes with everyone so forgive me if they're a little rough. Trying something out (sharing).

​--Arry 

​Notes from the conference on this talk: Danielle DiMartino Booth will be interviewed live by our hosts, where she will give a brief overview of the recent global developments and their potential economic effects. She will undoubtedly discuss central bank action and the likely scenarios for equities, interest rates and various asset classes.

Her ability to create really useful analysis and her Markets Briefings was how she made her mark and gained the attention of the great investors (Warren Buffet and Charlie Munger for example). They saw some of her work and invited her to Omaha to meet with them personally (she couldn't because she had a 5 month old baby - and they said no problem, they would provide childcare so she took the whole family.) Worked in the Fed, Speaks truth AND she doesn’t do sensitivity training. :) LOL. In the Fall 2015, inside the Fed, she was given special instruction to pay attention to only Jay Powell. An outsider insider. Danielle was not liked at the Fed. 

Covid was a bump or the catalyst, from October 2018. She really understands the markets and the behaviors, the impact to the market. Jay Powell really understands the credit markets. What’s going to happen going forward does she think? A doomsday policy was in place after junk bond issuance freezing. May 2019, Neiman Marcus issued debt and the bond market froze. Jay Powell talked about easing so the markets over again. Again, there already was a doomsday policy. Morgan Stanley did the math. Jay Powell already knew TRIPLE B was an accident happening. Any downgraded debt was eligible for purchase by the Fed — so even if anything was junk, the investors had to treat it with respect.

The problem is that today, the market is losing confidence. Jay Powell cannot create cashflow. He hates Trump (even though he’s a Republican). He will not buy stocks 39 days before an election. Optimically and narratively it’s more damning. It’s ready to deploy - but he will likely do nothing. He will not do negative interest rates. Other countries can. Everything will break. Someone needs to have a reference free rate. 

Jay Powell spoke yesterday. Downside risk is out there without further federal aid. The Fed is begging congress to do something. The growth of fed balance sheet is correlated with the S&P. The Fed wants more stimulus. “I wouldn’t say we are out of ammo”. Did he say it? He kind of did. They need “product” = They need “paper”. 

Is the Fed influenced by the president? Danielle says no. Jay is afraid of the credit markets. He doesn’t care about supporting Trump. One thing to note, is that Munichen and Powell speak the same language. What the Fed is doing is doing now against the law. During WWII there was yield control and there was a cap. The Fed and the Government were severed in 1951 - Fed was separated from government. There was an accord. Now because of what's going on, future politicians will have to RE-separate the Fed to be nonpolitical. 

Rhethoric today for Powell, is one of his biggest tools. The briefcase indicator. Powell likes to “play” with investors. What happens if the investing public loses confidence in the Fed? You’re already seeing that. He blows it on Jackson Hole on August 27. The whole world freaked out as a regime change. F1c statement to 2023, with a target of 1.7%. Market took a step back. The Fed, before this rhetoric, the Fed had been buying up all kinds of stuff. The Fed is creating the narrative. 26 million people are collecting unemployment, when there’s deflation knocking on the door. Powell is trying to bring up inflation. Rent is coming down. Housing is the main # into every model. 

The Fed gauges inflation how? Fed has to hide behind inflation. Our health care inflation is not medicare/medicaid rates. They know that. They know we spend more on housing. They have to have this broken metric to support the Contant QE. They can’t change this. They are trapped. QE is important. They cannot turn the facilities, they cannot turn off the printing presses. If they decide to become the printing press for hire. We’re going to go from deflation too STAGflation. 

What is the breaking point that will push yields? Traders are all waiting for this. Dallas, Scottsdale - Jay Powell has created the housing boom. The Housing is the most leading of all sectors. He bought all mortgage back securities in 5 minutes. You have rates of 1.99%. Ed Pinto (Fannie’s former economist). IN 6 months, cash out refinancing is HOT. The appraisals are not even happening. Fed is creating the narrative that there is this hot market. Wealthy people are renting homes for $75k. People who have money? FHA lending is still 3.5% down — people who are not wealthy are hurting. If you see the riots now, it’s going to be worse in March. Once banks can start to foreclose - this is going to cause mayhem. This is all caused by the Fed. 

You’re bullish precious metals? Gold? What will drive prices higher. Right now investors are going after the traditional next. Miniature repeat of March/April 2020. People are calling bluff of Fed and selling Gold. Gold is still outperforming in both deflationary and inflationary markets, and with volatility. If you’re looking for protection - Buy the Move. 

How do you feel about cryptocurrencies? The trading community is favoring it as a hedge. It’s like TikTok instead of the walkman. People that want to make a name for themselves buy Bitcoin. The old people want Gold. If we go over the line into quantum and it becomes more economical to mine this stuff. People are disgusted with the fiat currency. Danielle owns gold.

Lot of people look at what the Fed is doing, expanding the balance sheet. $1.5Billion/hour worldwide is what is being printed. Will asset prices will go higher? Is this a V shaped recovery? No, it’s a VERY K SHAPED RECOVERY. Small businesses hire most of the Americans and have been left behind. Great innovations. Great new industries. Lots of people left behind. The K may not be permanent. Raymond James, law firms are laying off. Indeed.com — job postings for high income are down 24% year over year. If we have more white collar jobs lost, then we’re in trouble. The stimulus really helped - if you see white collar layoffs, they the K will not happen. It’ll be a W shape. 

What about Japan and the bank of Japan? The rates are at 0. US to Japan is apples and oranges, but is there anything to compare? Yes and no. The No is that the fact about 1/3 of treasuries are owned by foreigners. It’s owned by the post office. Banks own 40% of CLOs. Good luck Japan. We are not Japan in the sense that we don’t have a long runway to start the printing presses because we pushed it so far. We are not at the point to being a recovery. Starting points matter. It’d be more convenient if we were Japan. The whole world is in recession. Japan is going in and out of recession despite it all. Nothing cataclysmic has happened - they’re an innovative country that’s moved that innovation to China. @bondstrategist on Twitter — sent out a poll a few weeks ago. We believe we’re in the Great Financial Crisis 2.0 because of the Credit issue. 

Is there a way for the Fed to get out of the box? They keep buying ever increasing debt. She wrote a book “fed up” as she’s not a fan of the Fed. That’s the trillion dollar question? The answer is you have to look at 2019. Russell 2000 and the broader stock have not ever gotten back to ATH’s off 2018, when the Fed tried to get out of it. They think they can do this for 10 years. I don’t think the market will not allow it. Bondage vigilantes have been hibernating for a long time - they will come out. The Fed can continue this for much longer - what they want us to believe. As long as there’s deflation, they will continue.

If Biden wins? Remember, the debt ceiling was passed - it was because the Democrats asked for no debt ceiling until 2021. From now until June 2021, there’s no debt ceiling. The bond investors will hit their pain threshold soon. Who knows when or what will happen.

How to find Danielle? Come to Quillintelligence.com — we publish/write every day. Macro investing is hot again. Data means something now again. They put unvarnished best research. She says @dimartinobooth follow on Twitter. 

As an insider at the Fed, is the plunge protection thing real at the Treasury? It is. It’s not inside the Fed. It involves more than the Fed and Treasury. It’s like you need a Lehman Brothers. That’s because they already had the Doomsday plan ready to go. 

Hi, All:

These are my personal notes from a talk I attended from the Investment Institute: Investing Notes: Brady Dougan 9/24/2020. I decided to attend this one because SPACs (Special Purpose Acquisition Companies) are all the rage right now and VERY INTERESTING as a vehicle for cash preservation (with some upside), and also for fundraising (as a company who's ready to scale and interested in doing an IPO (Initial Public Offering - when a company goes from being private to public), with a lot more support). SPACs remind me of the ICO (Initial Coin Offering) world, from which I got my first taste of this. They are sometimes called "Blank Check Companies". Some people will criticize and ridicule it. I am a believer and think this is a trend that'll be sticking around. 

Hope these notes are helpful to someone out there. Feedback always welcome.

--Arry 

Here are the bios of the folks that were in the presentation:
​
Brady Dougan (Interviewee)
Brady Dougan is an American banker and CEO of Exos. From 2007 to 2015, he was the Chief Executive Officer of Credit Suisse. Before this, Dougan was CEO of Investment Banking and acting CEO of Credit Suisse Americas.   After starting his career in the derivatives group at Bankers Trust, Dougan was hired by Allen Wheat to join Credit Suisse Financial Products in 1990. In 1996 he was named Head of the Equities division, a position he held for five years before being appointed Global Head of the Securities division in 2001. From 2002 to July 2004, he was Co-President, Institutional Services at Credit Suisse First Boston, and from 2004 until the merger with Credit Suisse in May 2005, he was Chief Executive Officer of Credit Suisse First Boston. Dougan received a BA in Economics in 1981 from the University of Chicago and an MBA in Finance in 1982 from the University of Chicago Booth School of Business. 
 
Ted Seides (Interviewer)
Ted Seides, CFA is the Founder of Capital Allocators LLC, which he created in 2016 to explore best practices in the asset management industry from the perspective of asset owners, asset managers, and other relevant players. He hosts the Capital Allocators podcast and serves as an advisor to allocators and asset managers. Previously, Ted was a founder and served as President and Co-Chief Investment Officer of Protégé Partners, LLC, where he spent 14 years at a leading multi-billion-dollar alternative investment firm that invested in and seeded hedge funds. Ted began his career in 1992 under the tutelage of David Swensen at the Yale University Investments Office. During his five years at Yale, Ted focused on external public equity managers and internal fixed income portfolio management. Following business school, he spent two years investing directly at two of Yale’s managers.

Brady Dougan Talk notes:

What is the functionality of financial institutions? What are the aspects of a bank that you took to Exos? Answer: The basic function is to intermediate the financial flows, and to do so in a productive way. This can be done a lot more efficiently through modern technology:

• Can do it all faster and more efficiently.
• Can do new things too.
• Platform play was important. 
• Lots of experience on the structuring side.
• Example - construction finance is an area of focus, has technology to track payments/data and allows business at scale. 
• Has algorithmic training business too.

SPAC investing opportunity. How to approach framework for investment fund in SPACs.

Then he talks about a special fund that Exos and Morgan Creek are doing together. It's called the "SPAC Plus Fund":

• Focus on short term relatively liquid cash safe vehicle. 
• SPACs are very interesting. They’re listed equities and trade on exchanges. 
  • First part of their life is very much like a fixed income.
  • Do an IPO, take the money and put it into a trust
  • When then do the acquisition, then they announce the acquisition.
    • If fail to do an acquisition, then investors get money back.
    • Fixed income protection on the downside.
  • If successful acquisition, then sell the stock at a profit.
  • Downside is the treasury with upside.
• Monthly liquidity.
• Is it a vehicle/type of asset? 
  • Instrument that optimizes for all the players involved.
  • Good return for investors.
  • Great vehicle for sponsors (management team of SPACs) gives them capital to deploy.
  • Good for the acquired companies. 
  • Very efficient and positive way to take companies public, good way to deploy the cash, manage cash.
• The market has graduated
  • We have high flyer companies - Virgin Galactic, etc… are using it as a vehicle. 
  • There are not many big losers.
  • People who take the biggest risk are the management team that create the SPACs. They’re 100% at risk. They’re the most knowledgable, etc…
  • They get great returns when they are successful.
    • They pay all the fees to take the company public - underwriting for IPO, the legal fees, etc…. All the costs of pursuing the acquisition 12-24 months. Fees on SPACs are 2% typically.
  • Promote or 20% that the sponsors own in the continuing business after the acquisition. There’s substantial dilution still. There’s fees. 
  • Opportunity to be a part of the initial private equity pool into SPACs too.
• Diversification is important
• Is this a fad?
  • No - likely be very durable. Serves everyone well.
  • It is a very interesting category of assets to have some exposure to
• SPAC to buy Bitcoin???
  • It’s a definitely a newer market.
  • It’s one of the reasons as an asset category it’s really important. 
  • Professionally managed asset is a good way to do that.
  • Access to mining as well.
• What’s the catch to SPAC+?
  • There isn’t it….
  • It’s an area you have to entertain any possibility 

What about crypto/stablecoins/etc?

• Regulatory side will develop and is slowing things down a little.
• The regulatory world is getting a lot of it right.

How do you allocate your time across all these different things?

• As CEO of Credit Suisse, my calendar was set for the next 2 years.
• With Exos, that’s not the case. Allows me to be very nimble and flexible. I have to be very responsive and flexible with my time. How to build new businesses or expand businesses. Lot is working with the team here. 

What’s the biggest unexpected challenge of being a CEO of Exos versus Credit Suisse?

• Brady has been surprised at how slow moving large organizations are. 

Here are some recent "Investing Notes" from two talks I attended this past week by Mark Yusko. I'm a very big fan of Mark Yusko. We personally had a chance to meet him at a Morgan Creek investor luncheon in early 2019 (I think I was pregnant with our second baby when we first met him). He is the first person I've ever met that has managed or manages more than a BILLION dollars. Mind blowing the number of zeros. And, Mark was the first interview we did on our podcast. I can remember being so nervous. He turned out to be a really nice person, with some really good words of wisdom. One of my favorite words he said that I say quite frequently, is "health is wealth". 

You'll see that Mark's general tone is that of a bear... he's bearish for sure. 

Link to the original Mark Yusko podcast interview (episode 22), if anyone wants to check him out. We spent a lot of the time trying to learn about who he is as a person, how he thinks, how his mind is wired, and his character - not just him as an investor. We have the interview on over 12 different audio platforms, including: 

• Apple: https://podcasts.apple.com/us/podcast/mark-yusko-full-interview-getting-to-know-real-founder/id1468319501?i=1000446288076
• iHeart: https://www.iheart.com/podcast/269-windshield-time-studio-47443086/episode/mark-yusko-full-interview-getting-to-47477226/
• Spotify: https://open.spotify.com/episode/1qt80EThsWw7T9VTaa5lGd

Also, Mark Yusko's bio here, if you want to know more about him. 

Attended a webinar (monthly) called HedgeD from Morgan Creek Capital today and took some investing notes that I want to share with my "Women Who Invest" Facebook group. Didn't see a good way to share it inside of Facebook - so putting my notes here for all to see. Sharing is caring, right? Here are my notes (along with my commentary).

So the market's going all crazy right now - new all time highs, everyone is a day trader, and looking a little more closely at these stock prices, the market caps are 20x, 28x, way higher than even revenues. Just so crazy expensive - and yet, when I look at these stock trading groups, people are pumping their hard earned dollars into these over priced assets. I worry.

October 2018-Present. The S&P is up 10%, which is about 5% a year (not really great). In reality, the money is actually down 40% (people just don't realize this yet.) During that same period, GLD is up 60%. Aren't we supposed to "buy cheap, sell high". People are buying high these days.... and they'll be forced to sell low. Again, in that same time period, Gold Corp is up 155%, Newman Gold is up 110%, Amazon up 55%, C Limited (Asia) is up 900%, Twilio is up 180%, and JD.com (Chinese) is up 120%. 

So passive funds (index funds) are going crazy too. Everyone is putting money in, and by everyone, it's the regular people (who are not your trained professional investors). Index funds do well when the money supply is high (like right now). So more money = higher prices. Eventually, the money supply will slow down and this will go negative, fast. And so if you take a step back, and look at the S&P for example over the last 20 years, compound return is only 5%. That's TERRIBLE. 

Stocks are even worse. People are buying things at stupid prices. Snowflake is the poster child for this craziness (it's at 227 times earnings or revenue.) --- WAY TOO EXPENSIVE. Zoom is at 100x revenue. And on top of it, everyone is being the same thing (the FAB4) - Apple, Microsoft, Amazon, Alphabet, Facebook.... the Valuations are too high. It's not sustainable.

Remarks on Wall Street versus Main Street. Wall Street are the professional investors. Main Street are the speculators and newly-minted "day traders". All of this money is going into stocks - and what people need to do is take a step back and realize, there's no market recovery happening. COVID19 is exacerbating inequality everywhere. Only 41% of Americans had ANY savings at all before COVID (so there are a LOT of people hurting right now.). This year alone, we're going to see over 46% of Americans become food insecure. 30% of kids that are supposed to be remote learning don't have a laptop or internet. Those that have will do even better, and those that do not have will do even worse. He said it'll be a k-shaped recovery.

The American economy is driven by consumer spending. Again, no market recovery coming. Consumer spending (even with perceived increases this summer) is still down 30% from April. High income earners are spending as a percentage 50% LESS than low income earners. Let that sink in. That means less high income earners traveling, eating out, going to bars, shopping - that hurts small businesses, restaurants, who hire even more of the low income earners. So, if Consumer Spending = GDP = S&P..... then the S&P will be in BIG trouble very shortly.

So why are the stock prices even higher? And a significant amount of the stock is going up for non earning companies. This is not sustainable. 47% of the Russell 2000 are NONearners. 15-20% of US companies are NOT profitable, they have more debt than profit (called "zombie companies" or "Stocks"). The Stock market is a raging mania and being driven by "retail investor" or more precisely, speculators. For instance, there were 3,000,000 NEW first time investors on Robinhood. And over 20% of all stock trading is coming from retail. On the otherwise, stock buybacks are not happening as much any more. Companies are not buying stocks. Bankruptcies and bad debt is soaring. And it's starting to trend that Biden will likely be the winner of the election, which means, HIGHER TAXES. Equity market is falling down.

There are still good companies out there. Look for EBITA margins greater than 50%. Look for companies that are in the digitization, consumerization off financial products, payments, etc.... you can access them through relationships (private equity side). 

Then they went into their sales schpeel on hedge funds. Average hedge funds are up 3.9%, and the best are up 30%, while the average stock has had almost NO return over the past 3 years. Choose wisely. 

Hope these investing notes from the webinar help give at least a perspective and is informational. 

--Arry 
P.S. Let me know if any questions or if you want to connect. I'm happy to connect you with these folks as well. Sharing is caring! Also check out the podcast, HedgeD -- their first interview is really good with John Burbank. 

I just read The Profile by Polina Marinova Pompliano (see above photo) and "Words and Character" do not carry enough weight these days. By the way, I highly recommend subscribing to The Profile, if you haven't yet. I was a fan when she did the Term Sheet at Fortune Magazine - and continue to be a fan. Today's Profile Dossier is on Hugh Jackman. I love this actor... and after reading about him today, I love him even more.

At the end of the article, there is a list of "techniques to try".... and one of them really hit a chord with me. Big deep one that's been on my mind a lot recently. 

From about 2007 to about 2015, I had a really good friend. We met through salsa dancing and I remember just being so moved by the fresh energy and zest for life she used to carry. She's off the charts amazing as a dancer too - I'd often sit on the side watching her. She had a way of dancing that was so detailed and natural - it was like watching an exotic car move effortlessly in a sea of Toyotas and Hondas. Beautiful. I tend to just fall in love with the people I bring into my life - and perhaps I put them on a pedestal too. Wonderful treasures of laughter, hugs, memories, and more. 

We went to each other's weddings. Our friends became her friends, and vice versa.

Then it started (again). I'm not sure if it's me. It's happened several times now where since I'm the only thing common, I can't help but think it's me. Maybe I'm not good enough. Maybe I'm just not that interesting. Maybe no one really wants to be friends with me in the first place. Am I even worth anyone's time? It's a downward spiral of sadness, and self-pity.

We'd be making plans to visit San Francisco, and of course, I'd send a note to my usual favorite friends to see while there. I'm usually an introvert and seek more of those intimate conversations with family/friends. Only if time is truly limited, I'll throw everyone into one big dinner or drinks...

She was on this list of friends I truly enjoyed seeing. The first time it happened, we were supposed to meet for a drink at happy hour. Then about an hour before, she was tired so wanted to push it to later. It became a dinner plan. Then around dinner, it became dessert. Then around dessert time, it became after dinner drinks... then late night drinks... then the next day.

My husband also thought it was weird. We brushed it off the first few times as oh well, the timing must have been difficult... oh bummer, they must be really busy... ...

​Words and Character. Shouldn't they mean something?

Then on subsequent attempts on following trips to San Francisco, plans would be made and broken again and again. And the questions of, who else is going to be there? Is anyone else going to be meeting up with us? ... Is there anyone notable that she would miss meeting if she didn't come out to meet up with me? ...

It just was not working out. I suppose I could have confronted her candidly about what I was experiencing. Then again, the relationship at that point now had a giant chasm of doubt in between. I did not trust that I knew anything about her anymore. The character and values that are so important to me didn't seem to match. Then I had to make a conscious decision and remove her from my mental list of folks that I wanted to see, and/or wanted to see me... I took it as perhaps I'm just not that exciting enough for her. Perhaps not beautiful enough. Perhaps not influential enough. Just not enough - and perhaps most definitely, we're not a fit for each other anymore. It was causing me so much heartache so I quietly went a different direction.

Experiences where family and friends don't keep their word puts a dent in the trust tree. Words and Character - they should mean something. Put enough dents into the trunk of the tree and it'll fall down and die. Perhaps it stems from a childhood trauma - like so many of these things we think are unique in our adult lives.... I used to run home every day hoping to see my father after school. He was never there.... and then only once he was there standing behind the front screen door when I got home.

And then, he was never there again.

​Tap. Tap. Tap. Tap. Tap. Tapping my shoulders.

Warmly,
​Arry 

Believe it or not... It's been a little over a year that I've been making all of the hand-soap in our home (and homes of extended family). Due to experiencing some very extreme prolonged stress (and then ending up with PTSD - had over a year of EMDR therapy with an excellent army veteran guy, so feeling much better), I ended up with head-to-toe psoriasis in 2018.

Then I found out I was pregnant. High risk pregnancy due to lots of things going on. (Don't worry, #theQuinoa is doing awesomely awesome.)

Then I learned about all the literal "crap" and chemicals that go into soap. ----> So that was it, I decided, we literally needed to "clean up" at home. Yea no more store bought shampoo nor conditioner for me. No more store bought body soap. I think I still smell ok. Hey, I'm Korean - so I got lucky in a lot of ways. I learned about the ingredients that go into soaps. I read this giant book about essential oils. Then I started selling the soap (small supply, not full time, just for kicks). These days, the soap is going by much more quickly with everyone washing their hands and faces multiple times a day, every day - I think about how many exposures are we getting  to the harsh chemicals. All of those chemicals end up in the sewers... 

Things to think about - are you using clean soap to clean these days? Look at the ingredients.

Anyways, one of my "hobbies" 2018-present that I wanted to share. Crazy how little we know and how much we assume in the things we do every single day.

Next on the list... figuring out gardening. I've never ever had a green thumb... any tricks? If I had even more time, I'd love to have chickens and fresh eggs. I know a bunch of y'all have done that - and I'm so jealous.

Maybe I'll trade you handmade CLEAN SOAP for FRESH EGGS? ​

--Arry

​PS. Or trade you SOAP for a cool-er logo? Thoughts on the version 1 I created with free software? 

Sharing some of the great work we're doing as the Cascadia Blockchain Council. Enjoy!
​
When it comes to blockchain, what it is, its use cases, and the industries using it, there’s a lot of information out there. You can admit it: maybe you feel mystified by blockchain technology.
​
Rest assured you’re not alone. While it’s true that blockchain gets a high volume of media coverage, that doesn’t mean it’s being written about clearly, comprehensively, or even accurately. No standard definition of blockchain exists globally, creating confusion and often misinformation that obscures this emerging technology’s legitimacy. This can hinder the policymaking process, deter investors, and generally leave the massive potential of blockchain technology untapped.