Intelsense Capital Blog: Weekend Reading

Reading Time: 5 minutes


Reading
across disciplines is one of the best ways to improve our investment acumen.
Here is a summary of some of the best articles I read this week.

I especially try to not post Corona related articles as that is all
one gets to read in all traditional media.

 

If you like this collection, consider forwarding it to someone who
you think will appreciate.

2021 – The year of the
Stockdale Paradox

The Stockdale
Paradox is a concept that author Jim Collins found a perfect example of in
James Stockdale, former vice-presidential candidate, who, during the Vietnam
War, was held captive as a prisoner of war for over seven years. He was one of
the highest-ranking naval officers at the time.

During this horrific
period, Stockdale was repeatedly tortured and had no reason to believe he’d
make it out alive. Held in the clutches of the grim reality of his hell world,
he found a way to stay alive by embracing both the harshness of his situation with
a balance of healthy optimism.

Stockdale explained
this idea as the following: “You must never confuse faith that you will
prevail in the end — which you can never afford to lose — with the discipline
to confront the most brutal facts of your current reality, whatever they might be.”

In the most simplest
explanation of this paradox, it’s the idea of hoping for the best, but
acknowledging and preparing for the worst.

https://bigthink.com/personal-growth/stockdale-paradox-confronting-reality-vital-success

 

How to make decisions – By
Barack Obama

I think you should read the whole article and not
just the below snippet.

 

In just a few short
weeks on the job, I had already realized that because every tough decision came
down to a probability, then certainty was an impossibility — which could leave
me encumbered by the sense that I could never get it quite right. So rather
than let myself get paralyzed in the quest for a perfect solution, or succumb
to the temptation to just go with my gut every time, I created a sound
decision-making process — one where I really listened to the experts, followed
the facts, considered my goals and weighed all of that against my principles.
Then, no matter how things turned out, I would at least know I had done my
level best with the information in front of me.

Also Read on FinMedium:  Valuation in Motion: Goodyear India Valuation

Even in situations
where you have to act relatively quickly, as was frequently the case during the
financial crisis, it helps to build in time to let your thoughts marinate.

It’s not always
clean and straightforward. But as my mother would say to me, “The world is
complicated, Bar. That’s why it’s interesting.”

https://barackobama.medium.com/how-i-approach-the-toughest-decisions-dc1b165cdf2d

 

 

The Amazon fake reviews
racket

Fake reviews have
been an issue for Amazon since its inception, but the problem appears to have
intensified in 2015, when Amazon.com began to court Chinese sellers.

But the ensuing rush
to the marketplace has spawned thousands of indistinguishable goods (chargers,
cables, batteries, etc.). And it has prompted sellers to game the system.

“It’s a lot harder
to sell on Amazon than it was 2 or 3 years ago,” adds Naim. “A lot of sellers
are trying to find shortcuts.”

Steve Lee, a Los
Angeles-based vendor, is among them: “You have to play the game to sell now,”
he says. “And that game is cheating and breaking the law.”

A recent ReviewMeta
analysis determined that in March of 2019 alone, Amazon was hit with a flurry
of more than 2 million unverified reviews (that is, reviews that can’t be
confirmed as purchases made through Amazon) — 99.6% of which were 5 stars.

Also Read on FinMedium:  How Will You Measure Your Life

“They’re almost all
for these off-brand, cheap electronic products: Phone chargers, headphones,
cables,” says Noonan. “Generic things that are super cheap to manufacture, have
good margins, and get a ton of searches.”

https://thehustle.co/amazon-fake-reviews

 

Zoom background books for
shelves available for wholesale!!

Books by the Foot, a
service run by the Maryland-based bookseller Wonder Book, has become a go-to
curator of Washington bookshelves, offering precisely what its name sounds like
it does. The Wonder Book staff doesn’t pry too much into which objective a particular
client is after. If an order were to come in for, say, 12 feet of books about
politics, specifically with a progressive or liberal tilt—as one did in
August—Wonder Book’s manager, Jessica Bowman, would simply send one of her more
politics-savvy staffers to the enormous box labeled “Politically Incorrect”
(the name of Books by the Foot’s politics package) to select about 120 books by
authors like Hillary Clinton, Bill Maher, Al Franken and Bob Woodward. The
books would then be “staged,” or arranged with the same care a florist might
extend to a bouquet of flowers, on a library cart; double-checked by a second
staffer; and then shipped off to the residence or commercial space where they
would eventually be shelved and displayed (or shelved and taken down to read).

https://www.politico.com/news/magazine/2020/12/26/books-by-the-foot-washington-dc-covid-books-440347

 

First principles in thinking

First principles
thinking, which is sometimes called reasoning from first principles, is one of
the most effective strategies you can employ for breaking down complicated
problems and generating original solutions.

“I tend to approach
things from a physics framework,” Musk said in an interview. “Physics teaches
you to reason from first principles rather than by analogy. So I said, okay,
let’s look at the first principles. What is a rocket made of? Aerospace-grade aluminium
alloys, plus some titanium, copper, and carbon fibre. Then I asked, what is the
value of those materials on the commodity market? It turned out that the
materials cost of a rocket was around two per cent of the typical price.”

Also Read on FinMedium:  Hopelessness in 'God's Own Country'

Instead of buying a
finished rocket for tens of millions, Musk decided to create his own company,
purchase the raw materials for cheap, and build the rockets himself. SpaceX was
born.

Within a few years,
SpaceX had cut the price of launching a rocket by nearly 10x while still making
a profit. Musk used first principles thinking to break the situation down to
the fundamentals, bypass the high prices of the aerospace industry, and create
a more effective solution.

https://jamesclear.com/first-principles

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subscribing to
www.intelsense.in long term advisory.

 

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subscribe to our Hitpicks advisory service on
www.intelsense.in

 

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Abhishek Basumallick

Abhishek Basumallick

Abhishek Basumallick is the Head of the equity advisory www.intelsense.in for long term wealth creation.
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