7 Comments

Difficult times to keep cool for sure. I remember a few weeks back a conversation I had with a friend regarding crypto. I was encouraging him to sell at least 10% to start paying back his original investment. He was so busy gloating that he didnt sell and is now preaching about how much more profitable his investment is going to be in the next few years. It is literaly insane to see how much some wanna be investors can make up excuses for past failures.

Have fun becoming poor when your "all eggs in the same basket" strategy will inevitably fail..

If you were to recommand one of the books you mentionned to get started on understanding value building, which one would it be?

Expand full comment
author

One lesson from March is that if you invest without a strong conviction into an asset and if you have weak hands, you will lose a lot.

It's a hard question. Fooled by Randomness or Black Swan by Taleb made a huge impression on me. I was like "wow, life is so random and extreme. I can lose everything I have built for years in few days". I see life differently after reading those books.

Expand full comment

The fact that one needs capital in order to make a living trading stocks seems to be lost on those new "traders" or investors. How can you explain the economics of one's income based on low capital any other way than high luck or insane risk taking? There isn't enough awareness in the general population that succesfulf investors have not started their career in a garage like silicon valley's tech moguls, but as employees of big investment firms.

Nicolas have you read any of Ray Dalio's books and seen his recent linkedin post about Bitcoin ?

Expand full comment
author

It reminds me the "turkey problem" introduced by Taleb in Antifragile. Turkeys spend their entire lives being fed and thus believe that the butcher loves them. Each day that the turkey is alive and being fed only strengthens the turkey’s confidence in this model and belief. However, come Thanksgiving each year, they are in for a black swan (they die). You should Google "Turkey problem image" is funny. Anyway, speculators might soon have a big fat surprise like the turkey.

I have started but not finished his books "Big Debt Crisis" and "Principles". I read however "Changing World Order: Why Nations Succeed Or Fail" which is kind of similar to books such as "Why Nations Fail" or "The fate of empires and Search for survival". It's interesting.

I have read his position about $BTC. I'm a Bitcoin bull - I bought for the next 50 years not to speculate in the next few months.

Expand full comment

I've read the black swan, the turkey graph is a favorite of mine :-) Taleb is a really smart guy! Love his books.

Dalio's confidence in Bitcoin and cryptocurrencies not being a highly speculative asset class anymore should be a reality check for every investor. He's far from being an amateur. Would love to read your opinion on Ethereum allowing the removal of the Proof of Work "hard cap" (infrastructure development and silicon manufacturing) and the impact it will have on the cryptocurrency market. I hear many investors are putting 20 to 40% of their cryptocurrency portoflio in Ethereum.

Expand full comment
author

Some big investors have endorsed bitcoin so far (Paul Tudor, Reid Hoffman, Stan Druckenmiller, Chamath Palihapitiya, Dorsey and Musk etc). It's definitely a high risk investment but it's also an amazing technological breakthrough with a big network effect.

Ethereum is interesting but it's still a beta product. I don't have a ETH position. Lyn Alden wrote a great article on investing in ETH: https://www.lynalden.com/ethereum-analysis/

Expand full comment

Thank you for the references. I liked Lyn's post aswell but she had the mining part very wrong. ETH is more speculative but it's also why it is more interesting. Higher tech breaks more often... but when it doesn't break it's a lot more powerful - which is how I tend to see ETH. Considering that ETH is fueling the cryptocurrency boom through token printing (with ICOs and now Tether and stable coins) I believe it's worth considering as a viable layer 1 investment. Looking forward to reading more from you about all these topics Nicolas!

Expand full comment