What We’re Reading (Week Ending 30 April 2023) - 30 Apr 2023
Reading helps us learn about the world and it is a really important aspect of investing. The legendary Charlie Munger even goes so far as to say that “I don’t think you can get to be a really good investor over a broad range without doing a massive amount of reading.” We (the co-founders of Compounder Fund) read widely across a range of topics, including investing, business, technology, and the world in general. We want to regularly share the best articles we’ve come across recently. Here they are (for the week ending 30 April 2023):
1. The Power of Incentives; SVB and Berkshire – John Huber
Charlie Munger says he believes he understands incentives better than 95% of everyone and yet he still feels he underestimates the power of them. Reading Berkshire’s financial statements and comparing them to SVB’s is yet another great example of how incentives drive behavior.
The collapse of Silicon Valley Bank is about three things:
- Short-term thinking (incentives to produce profits now regardless of long-term risk); This led to…
- Poor capital allocation decisions, which then enabled…
- A concentrated deposit base to become problematic
In my view #1 was the real issue. #2 was the result. But #3 only became a problem because of the first two. Many companies have concentrated customer bases and some have even built long-lasting businesses serving just one main customer (contractors for the government, suppliers to Costco, etc…). Concentrated customer bases always have some level of risk, but that risk can usually be managed. Though wood can catch fire, a house made of wood that burns to the ground is usually not the wood’s fault. SVB’s concentrated customer base only became a problem after decisions were made to take a lot of risk tomorrow for a little extra money today. SVB didn’t fail because of the run on the bank. It failed because it wiped out its capital, which then created conditions that led to the run. So what caused the bank’s book value to get wiped out?…
…Looking at SVB’s cash flow statements from 2020-2021 shows a whopping $118 billion of incoming cash from deposits and $92 billion of that going into long duration bonds yielding 2% or less:…
…Buffett sums this up perfectly: “banks can be great businesses if you don’t do something stupid on the asset side”. SVB was a great business until they decided to buy long-term bonds at 50 times earnings (i.e. the price you pay when you buy a bond with a 2% yield). This is extraordinarily risky. There is no credit risk. But that is not the only risk you need to consider when buying a stock or a bond. You also have valuation risk. Microsoft in 1999 had no credit risk (practically speaking). But buying MSFT at 70 P/E had lots of valuation risk. It was a safe business but not a safe investment.
Buying bonds backed by 30-year government guaranteed mortgages carries no credit risk. But they can be very safe investments at one price and extraordinarily risky at another price.
So why did SVB engage in such risky investments? The proxy statement provides the answers. Generally, SVB management was paid bonuses based on achieving certain ROE targets and stock price appreciation. This isn’t unusual and achieving a high ROE is a worthy objective. But the problem lies in the time horizon. The numerator of the ROE (the “R”) is net income. Essentially the management team was incentivized to produce as much profit on their capital as they could this year. This makes the decision very easy on what to do with over $100 billion of new cash from deposits: when left with the choice between 0% and 2%, the latter provides an extra $2 billion in interest income that mostly drops to the bottom line.
To make matters worse, the footnotes deep in the proxy also mention that the compensation committee can make adjustments to these profitability targets for out of the ordinary or “other items that are subject to factors beyond management’s control, such as investment securities gains and losses” (!)
2. The History of AI in 7 Experiments – Mario Gabriele
AI has a long, storied connection with games. In 1950, legendary mathematician Claude Shannon penned a study called “Programming a Computer for Playing Chess,” which outlined techniques and algorithms to create a talented chess machine. Of course, less than fifty years later, IBM introduced Deep Blue, the first AI program that beat a world champion under regulation conditions. Its defeat of Garry Kasparov on February 10, 1996 – the first of several – demonstrated AI’s ability to outmatch humans in even highly complex, theoretically cerebral challenges, attracting major attention.
In 2013, a new game-playing AI was introduced to the world, albeit with significantly less fanfare. That year, Cambridge-based company DeepMind enunciated its goal to create a “single neural network” capable of playing dozens of Atari video game titles. In itself, that might not have been a particularly audacious mission. What made DeepMind’s work so intriguing to experts like Michael Wooldridge was the methodology the firm used. As explained in the Oxford professor’s book, A Brief History of Artificial Intelligence, “Nobody told the program anything at all about the games it was playing.” Researchers did not attempt to feed its engine certain rules or the tactics gleaned from a champion player. The program simply played the game and observed which actions increased its score.
This process is called “reinforcement learning.” Rather than relying on training data, reinforcement learning programs learn through “rewards.” When the program does something good (oriented toward its goal), it receives a positive reward. If it does something negative (counter to its goal), it receives a negative one. Through this iterative feedback process, a program learns to reach its goal. Because it doesn’t receive explicit instructions, it often wins by employing strategies a human might never have conceived of – and may not fully understand.
The results of DeepMind’s Atari program were a revelation. A 2015 paper revealed that the engine had learned to outperform humans at 29 of the 49 Atari titles initially outlined. In some instances, the program reached “superhuman” levels and demonstrated intelligent, novel techniques.
Though impressive in its own right, the work DeepMind did with its Atari program set the groundwork for later innovations. In 2016, the company released AlphaGo, an AI designed to play the Chinese game Go – a vaster, significantly more complex game than chess. “Shannon’s number,” named after the information theory pioneer, pegs the number of possible moves in a chess game at 10123; Go’s is 10360. Using a mixture of “supervised learning” (feeding the algorithm game information from expert players) and reinforcement learning, DeepMind created an engine that comfortably defeated world champion Lee Sedol four games to one, relying on techniques and tactics that look strange to the human player. AlphaGo’s success was followed by broader and more powerful programs like AlphaGo Zero and AlphaZero. The latter learned to play high-level chess in just nine hours, learning only by playing itself.
DeepMind’s crowning achievement was AlphaFold. For fifty years, the “protein folding problem” – figuring out what three-dimensional shapes proteins form – had stood as an unsolved biological “grand challenge.”
By relying on reinforcement learning and other techniques, AlphaFold radically improved protein modeling accuracy from approximately 40% to 85%. As outlined in The Age of AI, AlphaFold’s impact is profound, “enabling biologists and chemists around the world to revisit old questions they had been unable to answer and to ask new questions about battling pathogens in people, animals, and plants.”
DeepMind demonstrated new methods for AI development that created programs that far exceeded human capabilities, whether in playing video games or mapping biological structures…
… Not very long ago, AI was rather poor at natural language creation. Sure, early applications like SHRDLU demonstrated some ability, but by and large, the ability to comprehend and write developed more slowly than other skills. By the mid-1990s, AI could crush legendary grand masters like Kasparov, but it wouldn’t have been able to craft a paragraph describing its feat. Even as late as 2015, language abilities lagged far behind deep learning models’ numinous abilities in image recognition and game-playing.
“Attention is All You Need” marked a turning point. The 2017 paper introduced the “transformer,” a novel architecture that relied on a process called “attention.” At the highest level, a transformer pays “attention” to all of its inputs simultaneously and uses them to predict the optimal output. By paying attention in this way, transformers can understand context and meaning much better than previous models.
Let’s work through a basic example of this principle. If you provided a prompt like “describe a palm tree” to a traditional model, it might struggle. It would look to process each word individually and wouldn’t note their connection to one another. You can imagine how that might result in obvious errors. For one thing, the term “palm” has multiple meanings: it refers to a type of tree and the underside of a hand. A model that doesn’t recognize the proximity of “tree” to “palm” could easily wax rhapsodic about love and life lines before veering into a discussion of the mighty oak.
By recognizing and encoding context, transformers were able to vastly improve text prediction, laying the groundwork for vastly superior conversational AIs like GPT-4 and Claude. Interestingly, transformers may emulate the brain more than we initially realized – once again validating Hinton’s hunches. Recent research suggests that the hippocampus, critical to memory function, is a “transformer, in disguise.” It represents another step forward in AI’s quest to manifest a general intelligence that meets, and eventually fully exceeds, our own.
3. The Best Businesses To Own – Chris Mayer
Dede Eyesan of Jenga Investment Partners produced a study of stocks that returned 1,000% in the last decade. It’s titled “Global Outperformers.”
Sweden comes out looking good in this study.
Sweden produced 20 companies with a return of more than 1,000%, about 4.5% of the total population of outperformers, even though Sweden represents only 1.5% of the global capitalization (as defined in the study)…
… Even so, why does Sweden produce so many winners?
Eyesan has a few thoughts. He cites innovation as one factor:
- “Sweden is the second most innovative country in the world according to the Global Innovation Index.
- “Sweden has the highest R&D expenditure of a % of GDP in Europe
- “Sweden has the ninth-best education system in the world”
I am a bit skeptical as to how much these things matter or even if it is possible to measure them. He also cites a focus on global growth among the Swedes. “It is common for Swedish startups to benchmark against global peers even in their early days,” writes Eyesan. And he points to government initiatives that encourage exports and international trade.
I have some of my own ideas as well, though they are anecdotal and not necessarily any better than Eyesan’s guesses. For one thing, there seems to be more attention paid to capital allocation (despite the widespread “dividend disease”) than I often find elsewhere. Many companies talk about, and even report, a number such as “return on capital employed.” There is good corporate governance, generally, with reasonable executive pay.
There is also a level of trust among the Swedes and a legal framework that allows for relatively easy, or more efficient, business combinations and transactions. All is to say, it seems like a good environment for business.
4. China Ratchets Up Pressure on Foreign Companies – Lingling Wei
Chinese authorities have embarked on a campaign to bring foreign businesses to heel, just months after Beijing delivered an open-for-business message to global investors.
In recent weeks, Chinese authorities have questioned staff at consulting firm Bain & Co.’s Shanghai office in a surprise visit, launched a cybersecurity review of imports from chip maker Micron Technology Inc., detained an employee of Japanese drugmaker Astellas Pharma Inc. and raided the Beijing office of U.S. due-diligence company Mintz Group.
The government has broadened its spy law to counter perceived foreign threats, including allowing for the inspection of baggage and electronic devices of those suspected of espionage, significantly raising the risks for Western companies operating in China…
…Business executives who have consulted with Chinese authorities say a central tenet of the effort is the desire to more tightly control the narrative about China’s governance and development, and limit the information collected by foreign companies such as auditors, management consultants and law firms that could influence how the outside world views China.
That has worried the Western business community, which relies on credible information and professional service to assess risks in China.
“The business community necessarily needs information,” said Lester Ross, a Beijing-based lawyer and chair of the policy committee at the American Chamber of Commerce in China. “There is therefore a risk that people will be unable on behalf of their companies to gather sufficient information for fear of being branded an espionage agent.”…
…Chinese officials involved in policy discussions say Beijing has no intention of pushing foreign companies out the door and have encouraged them to expand production in China. But they also say those companies should do a better job of helping advance China’s development in exchange for their access to the Chinese market.
A commonly held view in Beijing’s leadership, the officials say, is that most multinationals can’t afford to lose the ability to sell and produce in China…
…Chinese leaders have long regarded Wall Street as a lobbying force for Beijing in Washington and even as it cracks down on a range of foreign businesses, China has made it easier for U.S. financial firms to operate in the country. Since late last year, JPMorgan Chase & Co., Fidelity Investments and Neuberger Berman have received rare licenses for wholly owned mutual-fund firms in China.
Still, Beijing is exerting greater pressure on foreign businesses as a way of hitting back at the U.S. and other Western actions seen as threatening China’s interests.
In other efforts to pressure American companies, Chinese regulators have slowed down their merger reviews of a number of proposed acquisitions by U.S. companies that need Beijing’s blessing, including Intel Corp.’s $5.2 billion takeover of Israel-based Tower Semiconductor Ltd. and chip maker MaxLinear Inc.’s $3.8 billion purchase of Silicon Motion Technology of Taiwan, The Wall Street Journal reported.
China will still be selective in going after U.S. companies, Arthur Kroeber, founding partner and head of research at economic consulting firm Gavekal Dragonomics, wrote in an April report. “It wouldn’t be in China’s interest to create such a climate of fear among U.S. companies that they conclude that China is a dangerous market and start to head for the exits,” he wrote.
5. RWH026: Wealth & Health w/ Jason Karp – William Green and Jason Karp
[00:33:33] William Green: So, can you give us a sense of how, what you were learning then about how to change your own lifestyle is actually really broadly applicable to pretty much all of us, despite our idiosyncrasies in how we process foods and react to things and what our genetics may be.
[00:33:46] Jason Karp: It’s, you know, and now, thankfully there’s so many resources and books and I can give you a bunch for your listeners.
[00:33:53] William Green: Yeah, do.
[00:33:53] Jason Karp: Back then there weren’t many, and you know, back then there was a burgeoning science that was considered almost voodoo. Called functional or integrative medicine. And the idea behind functional medicine is that modern western medicine, which, you know, some people call it healthcare, but it’s really disease care, is what most Western medicine is, which is people come in with sicknesses and we figure out ways to address the symptoms of those sicknesses, but not necessarily the root cause.
[00:34:23] Jason Karp: So, for example, I came in with alopecia. I came in with eczema and psoriasis. I came in with a degenerative eye disease. They’re like, okay, here’s a cream for your eczema and psoriasis. Here’s a pill that will stop your hair from falling out. Here is a vitamin that might be in antioxidant to help your eyes from degenerating further.
[00:34:44] Jason Karp: And doctors all thought they were separate, whereas there were doctors who were pioneers at the time, like Dr. Andrew Weil and Dr. Mark Hyman who have both written many books on integrative or functional medicine and their approaches treat the root cause of disease, not the symptoms. And they’re like, get processed food out of your diet.
[00:35:01] Jason Karp: Make sure you sleep at least seven hours a night. Make sure you’re not eating like super processed junk food that’s causing systemic inflammation. And so, I had been doing a lot of reading on inflammation, on anthropology and evolution and biological aspects of how the body works, and there was enough science then that most of our problems as humans are related to single causes of things, as opposed to lots of little things.
[00:35:31] Jason Karp: And so, my approach was I’m going to basically try to reduce my body inflammation. And it turns out that even today with the advances in science that we have, and you know, on all these podcasts, people are talking about crazy cutting-edge things, you know, that extend your age by five or 10 years. And you hear about these molecules like rapamycin and metformin, and you know, they’re all talking about Ozempic now.
[00:35:53] Jason Karp: But you can get 80, 90% of the way there in terms of living well to the age of a hundred with like four simple things that we’ve known about for like a hundred years, right? Which is unprocessed food. And that we could go in depth in any of these, which is basically what you put in your body, right? Which food is the most important thing you can do.
[00:36:12] Jason Karp: But that also includes supplements, what you put on your body. So that also includes like pollution, chemicals, mold, lotions, you know, shampoos. There’s so much toxic crap in most products today that you’re constantly slathering on your skin, which is your largest organ, and seeps right into your bloodstream, sleep and stress levels. And then you can kind of dig into stress levels in terms of things like laughter, community, service to others. And when you study Blue Zones and these Blue Zones, for some of your listeners who may not know them, Blue Zones are basically a select group of towns and cities in the world that have been studied by anthropologists, where they have multiple standard deviations, more of centenarians, people who live to a hundred than any other cohort.
[00:36:59] Jason Karp: And they’ve studied these groups and they’re all over the world. Most of them are in Europe, a few in Asia, we have one here in the US which are the Latter Day Adventists, but there’s a couple in, and there’s Sardinia one, and there’s one in Greece and there’s two in Japan. And they all have this kind of common thread of having those variables.
[00:37:18] Jason Karp: And you know, most people get nervous that they have to do all this biohacking to live longer. And ironically, all that biohacking stuff is actually on the margin. If you’re not eating really well and clean, then we can go into what that means and you’re not sleeping seven, eight hours a night. And I was a sleep expert, and it is like one, 100th of a percent of the population that has a weird disorder where they can survive on six hours or less of sleep a night.
[00:37:45] Jason Karp: It’s not like 10% of the population. It’s like one, 1000th of a percent. We all need seven to eight hours of sleep a night every night. Good sleep. And then there’s like a bunch of sort of obvious things that are automatic life detractors that we know are dumb to do, but people still do them like smoking cigarettes, drinking soda.
[00:38:05] Jason Karp: Those will shave off five to 15 years of your life automatically if you do those activities. And so, for me, a lot of my journey was just understanding what it is about these populations. And by the way, not just the Blue Zones, but also there’s a number of indigenous peoples that still exist as hunter gatherers all over the world that have lived this way for a thousand plus years.
[00:38:27] Jason Karp: And they have them in every continent, you know, from like Arctic, you know, to the jungle, to Africa, to US. And they all have the same attributes. And what’s interesting about the indigenous peoples who don’t live with any modern technology, they have no allergies, they have no autism, they have no chronic diseases.
[00:38:47] Jason Karp: So, no diabetes, no heart disease, no obesity. They have none of our modern diseases. Many of the elders live to a hundred. And what’s amazing is that, you know, there’s ones in the Arctic that have absolutely no fruit and vegetables. They eat literally well, blubber and meat. There’s tribes that live only off of fruits and vegetables and seeds.
[00:39:07] Jason Karp: There’s tribes in Africa that consume a shocking amount of cow blood and meat. So, you have vegans, you have carnivores, you have all these different types. And what’s consistent about all of them is that they all eat as close to the earth as possible with the minimal amount of processing as possible.
[00:39:22] Jason Karp: They all prize community. They all prize their elders. So, their elders have a significant function in their society. They all get a lot of movement every day, and they all sleep. And that’s the common thread. And so, there’s just, there’s so much that is not controversial and not disputable, but in today’s modern society, it’s a very inconvenient truth that food and toxins in our environment and toxic lifestyle, sedentary behavior, constant addictions to the phones and the computers, et cetera, no social connection, isolation.
[00:39:56] Jason Karp: It’s a very inconvenient truth that this actually is what’s killing us, but it’s not even disputable and it’s not controversial…
…[00:43:14] Jason Karp: The way I’ve explained it to a lot of people. And, and it’s the reason why both of the health and wellness businesses that I co-founded have the word human in them.
[00:43:23] Jason Karp: And the easiest way for everyone to remember all this is we just have to live consistent with the way in which we evolved. Because if you think about how we’ve evolved as humans, you know, it goes back 2 million years. Right? You know, we don’t know exactly, but it’s at least 2 million years and for 99.999% of that, we live basically the same kind of way.
[00:43:47] Jason Karp: Right? And it’s rather remarkable how little progress there was until like 300 years ago in the grand scheme of 2 million years. And we were nomadic, we were hunter gatherers. We lived under the stars. We hunted and gathered for our food. We lived in tribes and communities. And when you think about the amount of evolution and the amount of kind of adaptive behaviors that we’ve evolved over that period of time, it’s staggering.
[00:44:18] Jason Karp: And then the hubris of us thinking in the last really, really hundred years, right? And this is reflected in all the data by the way. It’s really reflected in the last 40 years, which is unbelievably scary. That the hubris of thinking like, oh yeah, that last 2 million years, like that doesn’t mean anything. Like we know better, we know better than that.
[00:44:37] Jason Karp: So, like, let’s try to go against everything that we evolved to do. Right? Like we never had processed foods, right? We never had sedentary behavior. We certainly didn’t have devices. Right? We never were isolated. ’cause if we were isolated, we would die. Right? So, we’ve evolved as social species and you know, just some of the stats in the last 40 years are so staggering.
[00:44:58] Jason Karp: You know, and I tell people this, that we are supposed to be the most technologically advanced. We’re supposed to know more than we ever have. We exercise more than we ever have right now. And we’re the sickest we’ve ever been in human history. We are the first generation in recorded human history that is predicted to live a shorter lifespan than the previous.
[00:45:16] Jason Karp: In 1990, there were zero states where more than 20% of the population was obese. Zero. That’s only 30 years ago. Today, there are zero states that are under 20 zero. 42% of the population in the US is obese. 93% of the US is metabolically unhealthy. 93%. 40% of eligible people for the military cannot go into the draft because of chronic disease…
…[01:12:35] Jason Karp: You know, I think for me, because I was so sick and I felt so sick and I had, I mean, I literally thought I was dying when I was 23. That was such a terror and trauma for me that it was very clear and motivating that I never wanted to go back there. The problem for most of humanity, because I’m more like a canary in the coal mine, where I just get sicker faster from these things than most people do, but everyone gets sick.
[01:13:01] Jason Karp: As is clear from the data is that it’s kind of like global warming for most people. It’s like not a right now problem. You know, like you put on a little weight every year. You feel a little shitier every year. You start going to the doctor more every year, but like, you don’t like to wake up and you’re like going blind like I did.
[01:13:17] Jason Karp: Like that doesn’t happen to most people. And I think for my children is it’s all about creating early habits because habits are really hard to change. And the other thing that very few people talk about, and I don’t want to go too deep into this ’cause it’s a controversial topic and you’re hearing a lot of pushback on it recently, but in the last few years there’s been this sort of concept that’s been connected to some of the woke movement called body positivity, where there’s been a lot of over acceptance of unhealthy behaviors and they’re trying to make it more about like, it’s okay if you’re 50 pounds overweight and like, that’s just what you look like and that’s just how you were born.
[01:13:56] Jason Karp: There’s one thing, of course, everyone has different shapes. Every, you know, everyone has different kind of normal evolutionary weights. That’s true. But if you’re 50 pounds overweight, which is something that’s objectively measurable, it creates the beginnings of all of the most problematic diseases that we know about with certainty, by the way, not like probabilistically like certainty, it’s just when.
[01:14:18] Jason Karp: And I think for people who listen to your podcast, one of the worst that scares me and scares people who are like us is dementia. You know, they now call in many scientific communities. Alzheimer’s is type three diabetes, and there is a very, very strong correlation between processed food and how you eat and your weight and whether you’re going to develop dementia or not.
[01:14:39] Jason Karp: And I think it’s really important to develop early habits because the other thing they don’t really teach you, and I’m sure you’ve seen it, but when you get fat, and let’s just call it very overweight, let’s not use the word fat, let’s call it very overweight. So more than 20, 30 pounds over what is considered kind of like metabolically healthy, it becomes much harder to stay thin.
[01:15:01] Jason Karp: And that is a biological fact of how your adipose cells multiply. When you get fatter, your fat cells increase in size, and they multiply. As your body starts taking in more glucose and fatter and more insulin, and then when you get thin again, the fat cells shrink. But the number of adipose cells don’t fully go back to where they were.
[01:15:21] Jason Karp: So, you have, as a thin person who was fat, you have more adipose cells than a thin person who was never fat. And that is going to set you up on a life of yo-yo dieting and make it much harder for you, for the rest of your life to stay thin. And that is something that I think is really important to teach children young because it’s, you’re going to make your life so much harder for the rest of your life if you allow yourself to do that.
[01:15:45] Jason Karp: And the answer is not all of these shortcut weight loss drugs that you’re hearing about, which have loads of side effects. So, I think teaching habits young and modeling good behavior is really important. And I just think like we’re in this weird moment in time where we’re happy to talk about like, you shouldn’t smoke cigarettes ’cause they’re going to give you cancer.
[01:16:04] Jason Karp: But like people are afraid to say to people like, being 40, 50, 60 pounds overweight is really unhealthy for you…
…[01:31:58] William Green: Can you talk about that? Because in some ways the big difficulty that you had at Tourbillon was you were riding this whirlwind where there was a kind of mismatch between, you know, your desire to be a long-term smart, fundamental investor, and you’re a shareholder’s desire to make money every quarter, every week, every month, every minute.
[01:32:17] Jason Karp: Yes. Well, there are a few interesting elements in that, in what you just said. The first, I would say I’ve learned so many interesting lessons from the Hu experience. The most important thing I’ve learned with consumer products, particularly mission-driven consumer products where people respect or value or care about what’s behind the brand, like why you do what you do.
[01:32:37] Jason Karp: And what made Hu so special is that my family, particularly, you know, my brother-in-law, Jordan and I were so unwavering in our discipline and approach of we will never use these ingredients, even if they’ll make us a lot more money, and we will only do it this way. And we had so many customers who could see that, and they could see that no other brand was doing that because all these other brands had investors who were like, you know what? Use this shitier ingredient. We’ll make more money. Do it. No one’s going to notice it. We never did that. And I think having authentic values is one of those hard kind of deferred gratification principles that customers actually can perceive. So that was the first thing. And then in a sort of weird, related way, I saw a lot of brands that had great values but had were parts of the investors were from funds and their funds that were, the investors in those businesses had five year, 70 year time horizons.
[01:33:32] Jason Karp: And those funds only would make money if those brands were sold. And so, I saw very suboptimal behavior with a lot of brands that I respected because the investors were driving the mission and the investors themselves did not have a mission. And they either sold them too early or they corrupted the brands, or they turned the brands into something it wasn’t. And so, I wanted to create a holding company structure for permanent capital so that we didn’t have that incentive of having our investors basically say, you know what? You know this like healthy ingredient stuff and this sustainability stuff, like it sounds great, but you’re not making money.
[01:34:06] Jason Karp: Change it. Like I didn’t, I never wanted that conversation because part of why we are here today in terms of how sick society is, is because so much of the food industry has been driven by financial investors, and there are other variables and KPIs that are not profit…
…[01:39:37] Jason Karp: And so, a lot of contextualizing has helped me a lot and just, you know, and forcing the kind of prompts and the hard questions about like, why are we doing all this? And so, you know that. And then for those who can do it, and it’s also controversial and it’s only legal in a few places now. Psychedelic therapy has helped me more than anything, of all the things I’ve done.
[01:39:59] William Green: Is that like psilocybin or ketamine? What sort of, where do you go if you want to learn more about that in a kind of responsible way where you’re going to be guided by people?
[01:40:09] Jason Karp: There’s some great resources online from Michael Pollan wrote a very famous book now, A New York Times bestseller called How to Change Your Mind. He chronicles his journey. Tim Ferriss talks about this regularly. It is now legal in Portland, Oregon. It’s legal in parts of Colorado. There’s certain countries where you can do this. There’s an underground community of this, but it is, you know, it’s a very safe, you know, psilocybin, what they used to call magic mushrooms have been around for thousands of years used by indigenous communities and I used to think it was a kind of like horseshit, for lack of a better term.
[01:40:41] Jason Karp: And I had a few friends who both also experienced significant trauma and told me about how it helped them, and it has a mechanism for your scientifically based listeners. It has a mechanism that’s very well established, which is why they’re beginning to legalize it. Now, that causes a flood of neurotransmitters in your brain that creates a level of plasticity in your brain where synaptic connections that used to be there, reconnect, and in many instances, connections that weren’t there.
[01:41:10] Jason Karp: Connect and allow you to see yourself and to see where your proclivities and tendencies come from without judgment. And so your ego of the armor that we’ve all created, we all have armor from years and years of how we’ve grown up. The armor comes down and you sort of look at yourself without judgment and say, oh, this is why I care so much about what people think of me, or this is why I’m so obsessed with performance, or this is why I can’t handle mediocrity or, and you’re able to look at it in a very clear, objective way without judgment and it allows you to have compassion for yourself and it allows you to have acceptance without complacency. And then you don’t feel the demons anymore.
[01:41:54] Jason Karp: And so, there’s a lot of resources about what they call guided psychedelic therapy online. Ketamine is another way that people can do it that is fully legal. There’s a lot of places that will do guided ketamine sessions. And that has been also very helpful for me in kind of, ’cause my armor was so thick that it was very hard for me to penetrate, like where these demons come from.
[01:42:16] Jason Karp: And I’ve done, I don’t know, thousands of hours of therapy and I would say 15 hours of psychedelic work have done more for me than thousands of hours of talk therapy.
[01:42:27] William Green: I’m no expert on this. I would just caution people to go carefully because I have a friend who did ketamine and had a bad response to it. It made him worse. And so, I’m not in any way saying that to be a naysayer. I’m just saying this is one of those areas where you want to be dealing with people who are really responsible. Like it isn’t, you don’t want to be playing with stuff.
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