Aug 24, 2021 Sign Up

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"If I believe that I am right, I will take it to the end of the earth until I am proven right." — Bill Ackman

Good morning! Yesterday Taco Bell announced Lil Nas as its brand new "Chief Impact Officer," an honorary role which will help him "collaborate with the brand experience from the inside out." (whatever the hell that means). It's a huge promotion from only 4 years ago when Lil Nas was working at a Taco Bell in Atlanta. In other news, the world of NFTs is heating up again. Someone just paid $1.3 million for a JPEG of a rock...

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1. Story of the Day: Cathie Wood is Our Warren Buffet

Cathie Wood is our generation's Warren Buffet. Her unusual approach to investing — which combines high levels of risk with high levels of transparency about her views to produce, at least last year, astronomically high returns — have connected with new investors in a way the financial industry had only dreamed of.

Her aggressive bets on often unprofitable technology stocks are a better fit for traders who brag on Reddit about YOLO-ing their rent money than it ever was for the endowments and institutions that rely on the traditional money management industry. Her unique ability to connect with individual investors has helped her become the most influential investor at work in the markets today.

She does seem an odd standard-bearer for these retail investors though. She is a 65-year-old creature of Wall Street’s asset management industry, as well as a deeply religious donor to conservative political campaigns. The idea for her firm, ARK Invest, came to her when she was listening to the "Jesus Calling" podcast in 2012.

Fast forward 9 years, Cathie Wood now manages nearly $85 billion — up from less than $10 billion at the end of 2019.

Short Squeez Takeaway: Cathie Wood might not match last year's blockbuster performance. In fact her funds have been badly trailing the overall market in 2021. One thing is for sure that she has changed Wall Street forever. Some of the world's biggest financial firms, such as Blackrock and Goldman Sachs, are rushing to introduce products such as transparent ETFs that she pioneered.

Source: NYT

2. Markets Rundown

• US stocks booked new records Monday, as investors appeared to wager that JPow will adopt a more dovish posture than previously anticipated when he speaks later this week at the annual Jackson Hole symposium

Movers & Shakers

• (+) Madison Square Garden Entertainment ($MSGE) +16% on strong fiscal Q4 earnings.
• (+) TuSimple ($TSP) +15% after a short-seller report that got investors' attention last week turned out to be pretty thin.
  
• (–) TAL Education Group ($TAL) -6% Chinese education stocks slumped again after new regulatory actions fired off by Beijing.

3. Top Reads

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4. Book of the Day: Quiet: The Power of Introverts in a World That Can't Stop Talking

At least one-third of the people we know are introverts. They are the ones who prefer listening to speaking; who innovate and create but dislike self-promotion; who favor working on their own over working in teams. It is to introverts—Rosa Parks, Chopin, Dr. Seuss, Steve Wozniak—that we owe many of the great contributions to society.

In Quiet, Susan Cain argues that we dramatically undervalue introverts and shows how much we lose in doing so. She charts the rise of the Extrovert Ideal throughout the twentieth century and explores how deeply it has come to permeate our culture. She also introduces us to successful introverts—from a witty, high-octane public speaker who recharges in solitude after his talks, to a record-breaking salesman who quietly taps into the power of questions.

5. Daily Visual: Which Animals Could You Beat in a Fight?
Which of the following animals, if any, do you think you could beat in a fight if you were unarmed?

Source: Statista

6.  Daily Acumen: Curse of Knowledge

The curse of knowledge is a cognitive bias that causes people to fail to properly understand the perspective of those who do not have as much information as them.

For example, the curse of knowledge can mean that an expert in some field might struggle to teach beginners, because the expert intuitively assumes that things that are obvious to them are also obvious to the beginners, even though that’s not the case.

One well-known example of the curse of knowledge is the tapping study. In this study, participants were randomly assigned to be either a tapper or a listener. Each tapper finger-tapped three tunes selected from a list of 25 well-known songs on a desk, and was then asked to estimate the probability that the listener will be able to successfully identify the song that they tapped, based only on the finger tapping.

On average, tappers estimated that listeners will be able to correctly identify the tunes that they tapped in about 50% of cases, with estimates ranging anywhere from 10% to 95%. However, in reality, listeners were able to successfully identify the tune based on the finger tapping in only 2.5% of cases.

Source: Effectiviology

7. Memes of the Day

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