2.39 - Convenience

“It is easier to act yourself into a better way of feeling than to feeling yourself into a better way of action." ― O.H. Mowrer

WeeklyEdible

Feb 05, 2023

Markets this Week:

S&P 500 is up 2.2%.
NASDAQ 100 is up 4.4%.
Bitcoin-USD is up 3%.
Ethereum-USD is up 7%

Headlines from this Week:

U.S. Federal Reserve raised rated by 25 basis points to between 4.50% - 4.75%.
OpenAI’s ChatGPT reached 100 million daily active users two months after its launch, making it the fastest-growing consumer application in history. Additionally, the company released a tool to detect AI-generated text, rolled out a $20/ month subscription service, and announced an integration with Microsoft Teams.
British Columbia started a 3-year experiment on January 31st: the province will no longer criminally prosecute adults age 18 and over for possession of small amounts of fentanyl, heroin, cocaine, MDMA and other hard drugs. Instead, they will be offered information on social programs and treatment, if they request it.
Lebanon devalues its currency by 90%.

Finance

By Vlad

Roaring

The takeaway from the FOMC meeting was that we are well on the path to a soft landing. This narrative was exactly what drove all the past bear market rallies, and with the S&P still down over 8% on a 1Y basis, we are far from out of the woods yet.

See, it’s a weird time right now. Some are sounding the alarm bells, saying this will be the worst bear market rally ever. For instance, Burry just tweeted “sell”, and rage quit his Twitter account.

Being short, he must have taken a significant loss. He’s likely still holding onto his positions, but his Treasury shorts are overdue and if he doesn’t sell them, he risks losing all the gains he might have made in 2022 with the hike in rates.

One thing the FED was clear about was that they would stay the course. This means doing whatever it takes to get inflation down. Powell emphasized that history has cautioned strongly against prematurely loosening policy (he’s said this like 5 times in 2022 and so far once in 2023).

So what do we make of all this?

Well, I think the answer stays the same. This can’t be a bad time to accumulate in the long-term, and if we do see a soft landing (or something that resembles one), we will still have some headwinds (as we always do). China invading Taiwan could be a crisis trigger in the medium-term, and Russia stalling the war can bring CPI up a bit.

But, that said, a new all-time-high could be underway for the stock market sooner than you may think. And by then, fomo-ing is not what you want to be doing. You’ll want to be the guy who bought early, and is thinking of where to move their stockpile of cash next.

TLDR: Powell came in stronger than the markets think.

This is not financial advice and you should always do your own research before investing in any securities or cryptocurrencies. The trading strategies mentioned above are only my opinion. I am not a public equities analyst, and you're following these tips at your own risk.

Sci-Tech

By Keyann Al-Kheder, Software Engineer

Convenience > Control & Privacy

People in the Web3 world are constantly discussing the tipping point for mainstream adoption of blockchain technology. Many believe that everyone will eventually switch from traditional banking to using Bitcoin. However, the reality is that people often prioritize convenience over privacy and control, and this can be seen in the widespread adoption of various technologies.

You see, Bitcoin and Ethereum aren’t the only technologies to have shifted from this like open-source tech to a ‘convenient product’. From hardware to operating systems and applications, the dominant technology is often a centralized implementation that abstracts the underlying open-source technology. For example, most people use pre-assembled computers instead of building their own, most people use Apple's iOS or Microsoft Windows operating system instead of Linux, and most use popular apps like Gmail and Facebook, or browsers like Google Chrome, instead of privacy-focused alternatives.

While open-source or decentralized technology provides a wonderful option, it's not always practical for most people in everyday life. This is because it often requires technical skills and a trade-off between privacy and control. For instance, people may not want to learn how to set up a node and store private keys in order to use Bitcoin.

You might be tempted to attribute this pattern to some flaw in human nature, but as a technical person myself, I can tell you that I don’t resort to privacy-focused alternatives either. And it’s not an issue of ignorance, or even laziness, it’s that it would be counter-productive not to leverage the convenience provided by centralized products. For example, I could browse the web through a command-line prompt and use some complex network routing to make my activity anonymous, but that’s much more work than reward, especially if I need to, say, research a high-volume of information quickly and keep tabs on it all. Using a browser is necessary, and I can’t be bothered to code my own browser.

There are many more examples I can draw on, but ultimately it all converges on the point that convenience is always preferable to most people, even if it comes at the cost of privacy and control. Most people are not willing to sacrifice the convenience of centralized technology for the potential benefits of open-source or decentralized options.

The image above is my attempt to illustrate this idea - the shaded person holding a key represents having control and privacy, but is at a disadvantage where they stand, because the other person in the spotlight stands on top and ahead.

Paradigm Shift

AI and Education

By Roman Kuittinen-Dhaoui, BBA (Hons.), CPHR Candidate

Open AI has taken the world by storm with ChatGPT which reached 1 million users in 5 days, and 100 million users in 2 months.

Driven by artificial intelligence, ChatGPT can answer questions, write essays, provide Excel formulas, debug code, etc. The program has so many capabilities which increase as its trained on new data (i.e., the information its based on has a fixed cutoff date).

Opinion (pro student)

Initially, the education industry was concerned with potential fraud. For example, New York City schools banned ChatGPT from school devices and WiFi networks. But they couldn’t censor students from using the program outside of school. Universities were concerned with academic dishonesty from students using the program to write their essays. However, those worries are easing as Open AI released a tool to help tell when text is written by AI.

These fears from schools are due to the education system being so rigid. The core syllabus has remained the same for decades in elementary and high schools in Canada and the United States with classes such as mathematics, science, social science (aka history), language, and art. The value of the content of these classes has been questioned. For example, most of the population won’t need to use the quadratic formula in real life but everyone has to learn it in math class. Why aren’t valuable life lessons and skills taught to young, impressionable, and moldable kids and teens such as personal finance (i.e.., taxes, saving for retirement, budgeting, etc.) or healthy living habits (i.e., coping with stress, dealing with social media, the importance of nutrition, sleep, and exercise, etc.). High school is designed to prepare students for post-secondary. Why aren’t they also designed to prepared students for life? Especially considering some students don’t attend college or university, and the latter are seeing declining enrollment as folks question the value and return on investment of an expensive post-secondary education.

Universities were also caught in an embarrassingly unprepared state. They have developed programs geared towards modern day society. For example, business classes taught 20 years ago are very different to business classes taught today due to the rise of the internet. However, although the subject matter of these classes has changed, the confines of a 4-year degree remain. The objective of a Bachelor’s is to make the student “well-rounded” with classes outside of their major such as writing, mathematics, sciences, etc. However, many of these degree requirements and mandatory classes are a waste of time for students but critical for university finances. University is designed to prepare students for a job. However, many graduates don’t end up working in the field they studied. Furthermore, why does a Bachelor’s need to take 4 years whereas a Masters can be completed in 16 to 24 months?

Counter Opinion (pro schools)

Students using ChatGPT to write their essays is wrong because its fraud and it deprives the students of the opportunity to develop their thinking. ChatGPT is a tool, like Google, to access information to solve problems. For example, you can use Google to find a source for your paper but you can’t use that information without proper citation to give credit to the author(s). Similarly, schools expect students to produce authentic work as humans are enrolled into classes, and not AI programs. Modern day society has created an attention economy because people struggle to focus. And rightfully so; they are bombarded with information, scroll mindlessly, etc. To write a piece (like the one you are readin right now) requires focus. I had to think about one side of the equation, consider alternatives, draft my thoughts, and then revise my work to ensure I wrote what I intended. This skill of critical thinking is a the foundation of everything dealing with logic. Good schools teach students how to think, not what to think!

TLDR: ChatGPT is bad for schools and students because it exposes their shortcomings.

(Head)Space

By Vlad

Life Sprints

I like to think of my business life in sprints. This helps me stay organized, and have a clear vision of what my short, medium and long-term goals are (both financially and professionally). I found making a list is really helpful. I’ve included some made-up examples of how it would look like to plan out life sprints.

Here is how I divide my sprint categories:

Immediate & Short Term (1-3 months): this is stuff like how much money am I for sure going to make and save (to the nearest cent!), what projects and jobs should I prioritize (as I’m self-employed), what clients should I give most attention to, and what are the biggest obstacles I have to overcome now.

For example: I want to wrap up these 3 projects at work and hit 225lbs on the bench press by the end of the spring. I will then look at asking my boss for a raise.
Medium Term (3-12 months): this is reserved for things like trips I am going to plan and go on, clients that may slow down and need to be replaced by new ones, shifts I want to make in my environment (maybe cut certain people / activities from my schedule, add others).

For example: I will get a second job by learning how to code in Python. I am going to take on a new workout activity, like a martial art.
Long Term (12-18 months): this is for the big plans. I like to think about where I may be living, what kind of place I want to be in, and how can I really grow my business beyond where it is today. This is for thinking big!

For example: I will move to a new, bigger apartment or house. Then I will get a dog. I will move into a senior role in my industry, and look to start my own company after that.

TLDR: Life sprints are a great tool to give you a sense of purpose in life.

Company of the Week

Addy Technology group is a Vancouver-based Canadian startup that owns AddyInvest, its app that enables investors to invest in real estate with as little as $1. This is a major step towards the tokenization of real-world assets, and although they do not use blockchain technology at the moment, it brings about a revolutionary way for people to get exposure to the asset class in an economy where only the highest earners can afford the luxury of owning highly sought after real estate.