A decade ago, the economy was hot and Gold was a hedge against inflation. Gold prices went up. Then the economy tanked, and Gold was a safe harbor against collapse. Gold prices went up even more. Then the Fed instated QE123, and Gold prices went up yet again because the government was printing so much money.
As humans, we seek a reality that matches our expectations. We want to be right, we like to feel smart. Changing your mind is one of the most difficult things we do. It is far easier to fool yourself into believing a falsehood than admit a mistake. Start with an answer and then find data to back it up.
That’s why some people exclusively get their information from Fox News, while others read Huffington Post and BuzzFeed. Conservatives who watch The Colbert Report claim that Colbert is serious, and only pretends to be joking, not the other way around.
Ask yourself, “What would make me reverse this decision? What facts or situations or new information would make me change my views or close my position or quit my current goal?”
There should be a long list of technical and fundamental answers. Every decision, no matter how compelling the underlying story, should have an exit strategy. This is especially true of choices that involve a huge emotional investment and an unhealthy reliance on narrative.
If there is no conceivable set of circumstances that would get you to cut your losses, you have a huge, devastating flaw in your approach to decision-making.
My graduate advisor at Harvard said that his most successful PhD student was a guy who graduated and became a comedy writer in Hollywood.
What, did you think it was gonna be the kid who graduated and took a $150k salary at Intel for the rest of his life?
From Howard Marks at Oaktree Capital: You can’t take the same actions as everyone else and expect to outperform.
Passive investors, benchmark huggers and herd followers have a high probability of achieving average performance and little risk of falling far short. But in exchange for safety from being much below average, they surrender their chance of being much above average.
In order to be first to the game, you have to do something that no one else wants to do, at least for a while. And there’s probably a pretty good reason why no one else wants to play that game. And there’s a very real risk that no one will ever join the game, and you’ll look like an idiot playing with yourself forever.
It’s even harder for institutional investors, because not only do they have to risk being wrong, they have to risk being wrong with other people’s money.
It’s not easy to say, “Hey sorry, I lost all of your money investing in this company that lets you hail a cab from your phone. I know everyone said it was a low-margin business in a tiny market, but I like to gamble.”
Public figures need to care about their reputation, and rightly so. John Maynard Keynes: Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.
Anyone without a reputation to uphold is free to shoot for the moon. Or be content with average. We all have different definitions of success.
Uber is now worth $17B. It was only 3 years ago that their ride count was in the tens of thousands and people weren’t sure if they were even worth $50 million.
Grampa Kalanick uses a flip phone in 2011. So baller.
As a bit of a late adopter, I did my grocery shopping through Google Shopping Express for the first time a couple weeks ago and I am instantly in love.
Google Shopping Express offers a seamless shopping experience where shoppers can browse a selection culled from a dozen stores, including Staples, Whole Foods, Smart & Final, and Toys ‘R’ Us.
I placed two orders, one to be delivered to Barnacle’s Mountain View office and one to our San Francisco site. Because I have a discerning palate, it turns out that the orders came from nine different stores. Whew, I thought. That sure saved me a lot of work!
Order #1: Destination Mountain ViewOrder #2: Destination SF
How it Works
Google has order fulfillment reps hanging out at each of the retail stores. These reps receive orders and pack them for delivery. Couriers (outsourced to 1-800Courier in SF, Modern Express in the South Bay) come to a store, pick up packages for an area, and drive door-to-door making the deliveries.
Interestingly, my SF order had a delivery from Nob Hill Foods, all the way down south in Redwood City. The Mountain View order also had an item from Nob Hill, but it came from the store in Los Gatos instead of the store in Redwood City — even though Redwood City is closer. In fact, there’s another Nob Hill store in Mountain View about 2 minutes away from our office.
Google Couriers en route to Barnacle in SFGoogle Couriers en route to Barnacle in Mountain View
Customer Experience
Because my order came from nine different stores, eight separate vehicles showed up at our offices. Only eight, because my Teriyaki Yakisoba from Smart & Final was canceled from the SF order: Out of Stock in Daly City. I received that same item in my Mountain View order, because it was still in stock in San Mateo.
Not a single cracker was broken!
In SF, three drivers showed up one at a time with our chips, crackers, and ramen, over a span of 4 hours. I received an email saying my Monster Energy Drink had been delivered, but nobody had shown up with it. I sent an email inquiry.
In Mountain View, I received my Teriyaki Yakisoba and Cracker Jack. Then it was noon, and I left for a couple hours to go feed homeless people. I returned to see three messages saying my almonds had been delivered, my ramen had been delivered, and an unsuccessful delivery attempt was made on my shampoo and that it would be redelivered the following day. I couldn’t find the purported almonds or ramen, so I emailed customer support.
The response:
“Hi Elaine,
I’ve connected with the courier. It looks like the Blue Diamond Toasted Coconut Almonds were left inside building 1599, around 12:02 PM.”
That’s down the street from our office. Now, I don’t fault the courier for being unable to find my address, because the building numbers are difficult to read — But is this what delivery has come to? Best effort? Is it now acceptable for the postman to drop my mail off at my neighbor’s house — “Ehh that’s close enough”? This time I had only ordered instant ramen and almonds, but what if my neighbor had received my weekly subscription of adult diapers and incontinence wipes?
These are awesome. Definitely worth the wait.
Anyway, the ramen had seemingly vanished, but the remaining items were redelivered to Mountain View the following day. So Google Shopping Express got a 40% success rate at our Mountain View office, which is three blocks from Google’s main campus.
The missing ramen appeared in my account a week later as a returned item. I have no idea how it found its way back to the store.
Are They Profitable?
Ah, there’s the billion-dollar question.
Orders are transported in cute little Priuses, so the vehicle operating cost is far lower than the cost of hiring a courier. I assume that Google is optimizing for the courier’s time by designating one courier per store. Time spent consolidating orders from separate stores would be better spent driving.
Assumptions: Wages taken from Modern Express job listings on Craigslist. Vehicle operating costs from AAA. Stem miles is distance from store to delivery zone, estimated from Google Shopping Express maps. Driver starts and returns to store. Time and distance between stops estimated from 25-cent ramen I ordered for random strangers all over Mountain View (sorry Google).
After my 6-month free trial ends, the delivery cost is $5 per store. Would this be profitable? Even assuming that Google Shopping Express charges an additional commission to the stores themselves, the answer is…probably not. BUT, if Google replaces those expensive human couriers with self-driving cars, then the answer could be affirmative.
Environmental Sustainability
Based solely on miles traveled, it is more efficient to send multiple delivery vehicles instead of having customers make individual shopping trips. But there is still the question of whether or not I like having five separate people knock on my door to hand me one item at a time. The path from car to doorstep is the most error-prone part of this supply chain — why replicate this link with each delivery?
I suspect that Google is failing to account for redelivery attempts in their process of minimizing courier time. Google’s self-driving cars will be better at learning my address than hired couriers, so that should improve the delivery success rate.
That leaves the final piece of the story, which is a picture of all the packaging my eight items arrived in:
Sallie Krawcheck’s Ellevate Organization recently launched an index fund comprised of companies where women make up a significant portion of officers and directors: The Pax Ellevate Global Women’s Index Fund (PXWEX).
Now now, I know what you’re thinking. How do I go all in on PXWEX Puts?
That’s not very nice. Studies have shown that female leaders are less ego-driven and more risk-averse than men. So a woman-led corporation may be less likely to take over the world, but also less likely to go the way of Enron.
If these attributes are reflected in the Women’s Index Fund holdings, then the most profitable approach here would be to sell PXWEX variance swaps.
