- The mortal sin that politicians keep committing
- Meeting Steve Jobs
Brexit, quantum weirdness in global finance and an exodus from equities…it’s tempting to buy some gold and go squelch around at Glastonbury, play the summer season, go on holiday to Cornwall or wherever and return to try to work out an investment strategy in September.
The whole Brexit campaign so far has been toxic, showing the extent to which political leaders on both sides keep committing the sin of scholasticism — treating as precise what is not precise, arguments dressed up with spurious statistics based for the most part on hastily skated over assumptions.
And it is clear that central bankers, left in the lurch by the global political class, are pursuing the same campaign.
Janet Yellen is at sixes and sevens…
The sector’s superstar, Raghuram Rajan, head of the Reserve Bank of India, is throwing in the towel…
As William White, the highly respected former chief economist at the BIS, goes from conference to conference stressing, central bankers are working off obsolete models of the world economy, which, he says, is more like an evolving forest than the neat cause-and-effect machine they imagine.
How does a professional invest in this environment?
I go back a long way and I can remember the then head of M&G Malcolm Hopkinson being asked what types of people make good investment analysts. Certainly not economists or accountants — the great quantifiers — he said. But historians, because they know how to read between the lines of documents and how human beings tend to react in certain circumstances.
Plus, he added, it is important for investors to know whether ‘the chairman is on the bottle.’
My beat is technology and I have been endorsing as investments the mission-driven companies with their tech titan founders such as Facebook, Google and Amazon…none of whom, to my knowledge, is on the bottle.
These are a new breed of capitalists: questioning everything on the fundamental assumption that the world doesn’t work well and needs their technologies to be fixed. Zuckerberg, Page, Brin and Bezos…these capitalists have built wide and deep moats around their companies and neutralised the threat of competition by acquiring the world’s most productive computer and data scientists and by building huge and compounding user networks and resulting data sets.
Mission-driven business is becoming a strong theme with millennial entrepreneurs — and they are backed by a community of business angels, VCs and corporate investors.
These people are looking way beyond the political and financial uncertainty.
I wrote about Apple last week, but I didn’t refer then to my direct experience of Steve Jobs when I worked at Apple’s PR agency Regis McKenna….
It was at the time of the launch of the Mac. Jobs was rude, not addicted to personal hygiene, but also obsessively driven to simplify digital things — to de-hassle the whole business of engaging with them, make useful, lovable, intuitive digital tools.
And of course he was driven to make beautiful products in the process.
In meetings, he had two reactions to ideas and prototypes — ‘that’s beautiful’ or ‘that’s crap.’
Apple created demand in a weak market not by polling consumers on what they wanted but offering them what they wanted but didn’t know they wanted.
Musk takes a similar approach at Tesla, with an Apple like focus on simplicity and style.
Without the beauty element but with simplicity and de-hassling things front and centre, this is what Amazon, par excellence, Uber, Netflix and AirBnB have in common.
In the coming week…
I am currently looking into how this applies to the ‘new hotness’ of virtual reality, which many currently associate with ‘vomit reality’ and ‘glassholes’ but into which over $4 billion of venture capital is being invested, with over a billion of it in China, in less than four years.
VR and it cousin AR <augmented reality> is at the kickoff stage of the build out of what some reckon by 2030 will the the next big computing platform for an internet of ‘presence and experience’ as the bedrock for every industry and personal engagement with the world.
Oculus Rift is to the VR/AR future what brick-sized car phones were to the iPhone.
I’ll report back soon on where to build early investment stakes in this ‘next platform build-out, and suggest in the meantime you read Kevin Kelly’s brilliant article on the Magic Leap in last month’s Wired magazine.
I also have some very interesting prospects in the fast developing field of battery technology — more on that in the coming weeks.
You can also read my report on how I believe Artificial Intelligence will develop over the next five years….
It spells out why I believe up to 40% of companies in mature stock exchanges will be wiped out or acquired in the next five to ten years….and how the likes of Bezos, Zuckerberg and Page are reshaping society…
As Kevin Kelly has pointed out: “The AI on the horizon looks like Amazon Web Services – cheap, reliable, industrial-grade digital smartness running behind everything, and almost invisible except when it blinks off. Like all utilities, AI will be supremely boring, even as it transforms the Internet, the global economy, and civilization…. This new utilitarian AI will also augment us individually as people (deepening our memory, speeding our recognition) and collectively as a species.”
Just click here to read the report
PS… I just noticed that China’s new Sunway TaihuLight supercomputer now ranks as the world’s fastest, nearly tripling the previous supercomputer speed record with a rating of 93 petaflops per second. A shock to the US, if it’s not a dressed up lab job.