Being clear-eyed and full-hearted doesn’t mean being passive, weak, or silent.
It means resisting every effort to supplant our autonomy of mind with symbols of identity, no matter the source.
Extreme language during election season isn’t anything new.
But this time it really is different. Our response must be different, too.
The question is not whether Trump will accept the election result if he loses. He won’t.
The question is whether a Missionary with actual power will join him.
Don’t get me wrong. I’m thoroughly despondent about the calcification, mendacity, and venal corruption that I think four years of Clinton™ will impose. Trump, on the other hand … I think he breaks us. Maybe he already has. He breaks us because he transforms every game we play as a country — from our domestic social games to our international security games — from a Coordination Game to a Competition Game.
The outcomes of NFL games are inordinately influenced by officials relative to other sports. This is not new. The Narrative environment faced by the NFL in 2021, however, IS new.
I’m not sure they’re ready for it.
When a famous person shakes his or her finger at you, they’re not telling you a fact.
They’re telling you how to think about a fact.
Called It - Election Edition
Men of God in the City of Man is a nine part series about a narrative virus that infected the charismatic and Pentecostal churches in the United States. It isn't a story about Christian Nationalism. It isn't a story about January 6th. It isn't a story about why people voted for Trump. It is a story about a story. It is a story about the language that created a self-sustaining movement defined by its unwavering belief in a fundamentally corrupt electoral system.
Recent Notes
Let Us Now Praise Famous Men
We are living in a Golden Age of corporate management competence, driven by the adoption of process technologies and minimax regret strategies. That’s not going to stop in 2019, and it has major implications for your portfolio strategy.
Audacity
Some resolution season advice for young professionals who would become successful professional investors without becoming charlatans – a task easier said than done.
Looking for Laffer-Likes
Complex systems and uncertainty influence us to look for something – anything – to hang our hat on. The problem? We’re prone to hang our hats on extrapolations of the rare facts we can find, many of which have no explanatory power at the margin, where markets live and breathe.
In the News | Week of 12.31.2018
Summary on most narrative-linked news of one announcing US company and this week’s December non-farm payrolls and unemployment updates.
Rock, Paper, Scissors
We’ve been doing it wrong with AI for too long. Time to do it right.
We can’t SOLVE for the future of complex social systems like markets or politics with algorithms. But we can CALCULATE the future of these systems with AI.
Lord Make Me Chaste … But Not Yet
The problem for markets today is not the Fed.
The problem for markets today is the guy in the White House and his game of Chicken with the world.
In the News | Week of 12.24.2018
With limited markets-related events next week, we instead highlight some of the most representative (and unique) reviews of 2018.
The Prediction Polka
We would usually tell you that all information is information. There is no good or bad. No right or wrong. But some things aren’t even information. Knowing what you can ignore is worthwhile.
Twilight of the (Consumer) Goods?
With increasing attention to trade and tariff narratives and falling attention to inflation and growth narratives in the U.S., we believe that investors may benefit from focus on sectors on which the latter narratives have weighed heavily in 2018. Of particular interest? Brand-oriented consumer stocks, especially many staples that have been left for dead.
The Road to Tannu Tuva, Pt. 1
When our processes of inquiry lack challenge, doubt and obsession with falsifying our best ideas, the result is inevitable. Our conclusions cease to be science and become something else entirely. That something else is a thing sensitive to narrative, vulnerable to priors and bias. That something else is scientism.
We Had The Same Crazy Idea
It is a frustrating truth that good – even great – investors rarely know exactly what it is that makes them good. And so the inevitable guilty pleasure of investors – building portfolios from the best ideas of their various managers and advisors – is almost always doomed to fail from the beginning.
Sin Boldly
There is very little that an investor can do to more easily become a better investor than to better understand his behavior. But the investor who relies on awareness, discipline and self-control remains susceptible to a world that seeks to influence his standard for correct behavior.
In the News | Week of 12.17.2018
Key articles for companies reporting the week of December 17, 2018, as well as the upcoming meeting of the FOMC.
Common Knowledge or Fortune?
Common knowledge effects, credentialing and missionaries are everywhere. You may differ in your view of their importance, but if your framework doesn’t acknowledge their role in price-setting, you’re not seeing the full picture.
Basically a Snake Don’t Have Parts
No matter how much you try to make mama tell you what part of the snake you’re eating, and no matter how much the answer might comfort you, it’s important to know that neither you nor she is telling the truth.
Topical Trends from Corporate Earnings Calls (12/2018)
As we’ve written a fair bit recently, the source of Narrative can often be as important as the stories being told themselves. By narrowing the…
Office Hours – 12.11.2018
Our December 11 edition of Office Hours has concluded, but subscribers can still catch the replay here.
Introduction to ET Professional
We are pleased to announce the launch of Epsilon Theory Professional, or ET Pro. It is a service designed to leverage our narrative research more directly for investors and asset owners. Learn more about the types of content and research we’re doing here.
You Don’t Have to Dance Every Dance
Discretionary investment always and in all ways boils down to two things: edge and odds. In the US-China trade war game of Chicken, you have no edge. And you don’t know the odds. Time to sit this dance out.
ET Live @ 2PM ET 12.11.2018
We will be live at 2PM on Tuesday, December 11, 2018. Click here to get more information about ET Live, how to subscribe and how to get your questions in for the day.