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Hi, I'm Jim O'Shaughnessy and welcome to Infinite Loops.
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Sometimes we get caught up in what feel like infinite loops when trying to figure things out.
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Markets go up and down, research is presented and then refuted, and we find ourselves right back where we started.
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The goal of this podcast is to learn how we can reset our thinking on issues that hopefully leaves us with a better understanding as to why we think the way we think and how we might be able to change that to avoid going in infinite loops of thought.
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We hope to offer our listeners a fresh perspective on a variety of issues and look at them through a multifaceted lens — including history, philosophy, art, science, linguistics, and yes, also through quantitative analysis.
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And through these discussions help you not only become a better investor, but also become a more nuanced thinker.
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With each episode we hope to bring you along with us as we learn together.
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Thanks for joining us, now please enjoy this episode of Infinite Loops.
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Disclaimer: Jim O'Shaughnessy is chairman and Co-Chief Investment Officer of O'Shaughnessy Asset Management, where Jamie Catherwood is an associate.
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All opinions expressed by Jim, Jamie and podcast guests are solely their own opinions and do not reflect the opinions of O'Shaughnessy Asset Management.
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This podcast is for informational purposes only, and should not be relied upon as a basis for investment decisions.
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Clients of O'Shaughnessy Asset Management may maintain positions in the securities discussed in this podcast.
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Jim O'Shaughnessy: Well, hello everyone.
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It's Jim O'Shaughnessy, with a very special guest today for his second appearance on Infinite Loops.
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I am delighted to have with me OSAM research partner, numero uno, you were the first one, Jesse Livermore, not his real name, which we might actually talk about, because Jesse, this is going to be the speculative conversation.
2:05
I listened to the first podcast we did, and then you and I texted back and forth, and we kind of dropped off when you were speculating on... Okay.
2:21
So the Oasis becomes a reality, so that's the Metaverse.
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The Oasis is what they call it in the book, Ready Player One.
2:26
And so that becomes a reality and we're all, like the fat people in Wall-E, just literally plugged in to the Metaverse or the Oasis.
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And we were thinking like, "Okay, so what kind of currency would they use?" Would they use USD? Would they use Euros?
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And so we'll begin our conversation there, but I want our listeners to understand that the reason I'm so excited about this, is you are possibly the smartest and yet most practical man that I've ever met in my life.
2:57
So, you get really pumped up when the soothsayers are saying, "Oh my God, the Metaverse is going to be incredible."
3:06
And they make all sorts of crazy predictions, and/or they have a very difficult time.
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Not the cheerleaders for the Metaverse or the Oasis, but rather others.
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Our history is littered with examples that we could give of a people saying, maybe five personal computers in people's homes, I think that was the head of IBM.
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Xerox invented the mouse, basically invented Graphical User Interface.
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Steve jobs stopped by and he goes, "Oh, that's really cool.
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Are you using that at any way?"
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And they were like, "No."
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So Steve jobs was like, "Well, thank you. That's excellent."
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And we all know what happened to Xerox.
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But this is something that just repeats and repeats and repeats.
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And I think there's a reason for it, but first off, so we're going to talk about government, about education, about what jobs look like, the collapse of time, space, and geography, and what that implies for various people.
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Anyway, long introduction, and I’m hoping that you basically tether me back down to earth, because I am very bullish and that is my bias.
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I am very bullish on what is happening.
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I am not naive about the problems that it's going to cause, which I think will be significant.
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I'm fully expecting a Nick Bostrom existential crisis piece on what's happening over the next 10 years, but we'll get into that.
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But, but let's start where we left off, if that's okay with you. First, welcome.
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Jesse Livermore: Thank you. Thank you for having me.
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I'm a huge fan, obviously.
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And the way that this structure, the podcast is structured makes it just incredibly fun to be part of. So thank you again.
4:46
Jim O'Shaughnessy: Oh my pleasure. My pleasure.
4:48
So let's pick up where we left off.
4:48
We were speculating if everything actually goes as planned and Packy McCormick would call it the Great Online Game, other people call it the Metaverse, I say, it's the Great Reshuffle.
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There's a bunch of names for what's happening.
5:04
But the overriding theme seems to be that exponential change is happening more and more and more.
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And let's say we are all on Oculus 6.
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0, and you and I meet in the Metaverse.
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I want to buy something from you, Jesse.
5:23
What do you think I'm going to pay you with?
5:26
Jesse Livermore: That's a fantastic question.
5:27
Well, so I think whatever it is, I don't know for sure what it would be, but whatever it is, it doesn't have to be something physical.
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Obviously it wouldn't be, because we're in the Metaverse.
5:34
It would have to be something that works, that would be one criterion.
5:34
It would have to be something that's functional, it doesn't give us problems.
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And it would have to be something that is tangible in a different way.
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So we have physical, we use physicality as a current measure for what's tangible to us.
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In a metaverse or an online universe, or some sort of simulation, you would have to have the same type of thing, except created virtually through colors, through space, through shapes, through...
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It has to be something like that.
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And then it would have to track to something that is scarce, that has some kind of scarcity, where you can't cheat the system.
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Because if it's something that I can just draw up on a notepad, on a computer notepad, then there's going to be as much of it as anyone wants to spend, and it's not going to work.
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So those things would have to work.
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It would have to be tangible in some way so we can in some way think about it as a thing, and then most importantly, you would have to have some scarcity attached to it.
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Jim O'Shaughnessy: So yeah, your talking about scarcity made me think of the Doug Adams thing, where in Hitchhikers or in one of the follow-up books, where they decide to make tree leaves the currency, and he goes, this had two immediate impacts.
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Number one, everyone was made enormously rich, but then when they brought the consultants in, and of course these are the people he's mocking, they said that the only way to make this work would be to begin a massive deforestation product or a process.
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So I think you're right on all of these, but what would you imagine?
6:58
What would that kind of thing be? Could it be an NFT?
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Could it be, I don't know. You tell me. Jesse Livermore: Yeah.
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I'm not an expert on this, but the blockchain stuff would seem like a natural solution for the scarcity problem.
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Something that's tied to a cryptographic entity that you can't manufacture.
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And the actual tangibility of it, or the nature of it, doesn't have to actually be identical to the blockchain aspect.
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They have to be tied together.
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So if there's some way that you can link them permanently, that would work.
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And then the problem is, I should have mentioned as well, in terms of the working aspect of it working, it has to work as a currency.
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So anything that we care about, in theory, could be a currency if we can trade it. We can't trade status. We care about status. We can't trade status.
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We can't trade pleasure directly.
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We can trade promises, but we can't trade the actual thing itself that we want, can't just be transferred from one person to the other.
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And so the crypto aspect is interesting because it can be traded and it's functional as a currency, whereas other things that we care about wouldn't be.
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The problem with the crypto is it doesn't have any...
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If we all decide that we don't care about crypto anymore, we don't want to use it, it's gone. It doesn't have a...
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But if we all decided today that we don't care about real estate, that would be kind of hard to imagine.
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Because we all do care about real estate. We care about space. We care about status. We care about wellbeing. We care about health. We care about...
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A currency itself, I guess we could say, is it's always a substitute in some way for the thing that we actually care about.
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And so I'm not criticizing Bitcoin in that respect, or I'm not criticizing the use of a tool like this in that respect.
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It's just that, how tightly correlated and strengthened is that connection?
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In the case of if the manufacturer of the online universe could come in and say, "The only thing you can use as money is this thing that we've installed into the system."
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That would really help, I would think.
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Because if you don't have that, you're floating with the wind.
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Now, if you have that, then you have at least something to anchor the entire process down.
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You can be confident that whatever you're trading for will have tradable value when you try to redeem it later.
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Jim O'Shaughnessy: So that would posit, like the book Ready Player One, one corporation that owned the Metaverse?
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I certainly don't think that's going to happen.
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I think that there's going to be different plugins and there'll be a variety of public gardens, private gardens, things like that.
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So, I think you're right about the scarcity.
9:14
I think you're absolutely right about that.
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And I wonder, because another function of currencies usually is that they are a store of value.
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And one of the things I was talking to you before we started recording, and I was reviewing the book Innumeracy: Mathematical Illiteracy and its Consequences by John Allen Paulos, and I looked at when he published, it was 2001.
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And one of the key things that I'm going to want to talk about and get your take on later, is this seeming inability for people to change the way they think from a linear, A implies B implies C, to a nonlinear exponential, which we'll get into in a minute.
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But potentially what you're saying is that, is there an opportunity for... Is that a company?
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Is something a company that basically is the issuer of these things that we're going to use as currency?
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Jesse Livermore: Honestly, I would think that that would be a problem if they were.
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Because if you have the ability, as the company, to issue the thing that has the value, you can just issue until it no longer has value.
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And who wants to- Jim O'Shaughnessy: Suddenly you're the United States of America.
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Jesse Livermore: Oh, yeah, that's a good point.
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It was segue into some sort of inflationary government that sees the opportunity to use the currency issuing power to do whatever it wants.
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I guess, to the credit of the crypto crowd, if you have some way to stop that, that's a plus in this system.
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If there's some way of originating currency that does not involve someone with fiat ability to create as much of it as they want.
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That's going to be hugely important.
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And anytime there's a company involved though, there's going to be some sort of a reason why the company is involved.
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There's going to be a reason why the company has an interest in this and it's going to probably involve the company making money at the expense of other counterparties.
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So I can understand the skepticism of having a corporation involved in something like this or seating that power to them, in the same way that we might have the same aversion, deceiving the power to the government.
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Jim O'Shaughnessy: Right.
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And so one of the things that I thought about when I...
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Because I don't have an answer to this, and I'm not saying you're going to give a definitive answer, but is the derivatives market. So most of that... I'm much older than you.
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And so I remember when derivatives were first coming online and the market loved them.
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The government for years didn't really understand them.
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And then you had guys like Buffet saying, "These are weapons of mass destruction and potentially he's right.
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We saw what happened in 2007 and '08. But, okay.
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So crypto, but we'd also have to have assurance, 100% assurance. Would you agree?
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Jesse Livermore: I'm just describing what I would like to see to be for my personality types to be really confident participating in something like this. I'm the opposite of...
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Maybe on, you have a spectrum of authoritarian on one end and anarchists on the other.
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I'm a little bit more towards the authoritarian end than maybe the average crypto aficionado.
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So when I'm starting to play in these games, I want to have some assurance that it's controlled, that the shortcomings of human nature are somehow being managed.
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And so that would be just for me.
12:15
Now, as far as the functionality of it all, I think a useful insight here is that what, and this relates to your comment about the derivatives, if you look at most things in life, how they work, we just go into them because they were already working.
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We don't understand them.
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We don't have a scientific theory from a bottoms up level, atomistic understanding of every aspect, they just work and they work at the surface level that we and interact with them on.
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And we use that surface level as our basis for developing insights into how it works into what the relationships are.
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We just stay at the surface.
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So if I come into the world in 1985, and I'm a trader, and I see all these derivatives that are new and there's never been a problem before, I'm going to use that as my guide and I'm going to say, there's no reason to worry. What's the problem. Just go, go, go.
13:03
And then when 1987 comes around and I see that there was this vulnerability that I wasn't aware of only then, in terms of the way a normal human being works, is it going to become salient to me and is it going to create a sensitivity.
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We don't have sensitivities to things that we're never exposed to.
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There's some people that can use theory, they have a deep understanding of something and they can theorize and for the first time, before the first time something hits, they can expect that it was going to hit.
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But think about how many people do that and are wrong.
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Think about how many people use theory or use some sort of anticipatory reasoning to predict what's going to happen and they end up being completely wrong because they miss some small detail.
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So, we have evolved as human beings to have beliefs about the way things work that is based on what we experience and especially what we personally experience, what we ourselves see going on.
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And there's a reason for that, it's adaptive.
13:49
The other way of trying to figure out what's going to happen, which is the super analytic, ground up, bottoms up approach, where you try to just for the first time predict the thing that has never happened before, that's going to happen now, that is a very unreliable form of trying to anticipate the world and interact with the world.
14:09
So I just throw that out there. Jim O'Shaughnessy: Yeah.
14:10
No, I completely agree with that.
14:10
Joe Weisenthal called me an anarchist on our podcast.
14:16
I'm not an anarchist, but maybe I'm a little closer to the middle of that spectrum, in terms of authoritarian versus the opposite.
14:22
But also, this whole problem with predictions.
14:28
My favorite book of the year so far was a reread.
14:28
It was David Deutsch's The Beginning of Infinity.
14:34
I have been recommending it way too much.
14:34
But the reason it's brilliant, at least I think, is that he builds an argument for why the world is the way it is right now.
14:40
He bases much of the aggregate social evolution, started with the enlightenment, Nullius in Verba. What was it?
14:53
1622, Isaac Newton with the Royal Society.
14:53
And one of his lines is, "It's a huge mistake to limit the choices to existing options, because we're totally ignoring options that might be invented in the future."
15:06
And that's what I'm trying to, just in a fun way, have our conversation today be about, but it's hard.
15:14
Trying to know the unknowable is like a Mugs game.
15:21
And because when you look at the history of bad forecasts, they look like a barbell, because as you might guess, I just did this.
15:28
And there are many more on this side which failed to see the impact of something.
15:34
So I mentioned a few, Xerox had all the tech and yet it took Steve jobs to say, "Oh, I'm going to use that." Kodak, classic example.
15:47
They could have and should have moved, and obviously I'm saying this in retrospect.
15:52
And so it looks like, "Oh, well of course they should have known that."
15:52
I'm not saying they should have known it.
15:57
I'm simply saying it's a great example for us to contemplate.
15:57
And the list goes on, Sears potentially could have owned the online world. Walmart potentially...
16:03
Actually this isn't in retrospective, because I wrote a piece in 1999 saying, listen, if Walmart decides it wants to own the internet, Walmart's going to own the internet.
16:15
And they decided they didn't want to.
16:21
And Jeff Bezos is really happy about that.
16:21
So we're going to put a pin in the currency for a minute, because there's just so many problems with currencies, because they are based, in large part, on credo, which means I believe. Credit. Credit comes from credo.
16:38
And so these are deep in our base code of human OS and you pointed out some things that we would all have to agree on.
16:45
So we'll put a pin in that.
16:45
And now let's talk about, so...
16:47
Now that we have Jamie online, we'll ask him in a minute about currencies because he knows financial history probably better than anyone, other than me, no kidding.
16:53
He probably knows it much better than me.
16:58
And he also knows all of the various things that have been used as currency, like salt, during the Roman Empire.
17:05
And one of the things though that I believe deeply in, is that it's not just currency.
17:13
So Jed McKinnon said, "Crazy is a numbers game."
17:13
And the person he was speaking to, "You mean if a lot of people believe in it?"
17:19
And then Jed says, "Yeah, they're no longer crazy."
17:25
So most of the ineffable world of today is based on belief, I think.
17:25
And that's one of the things that I just see we've got this, what I'm calling, The Great Reshuffle happening right now.
17:33
And so let's talk about for example, government.
17:41
And I don't mean just the United States government, Jesse.
17:47
I mean worldwide governments.
17:47
I think that what we saw in their reaction to the COVID problem was literally a completely...
17:54
If you were rating plans from one to a hundred, they picked 101.
18:03
And it wasn't just our government that did this, this was governments worldwide.
18:10
And so that kind of got me thinking on this whole idea.
18:10
Do you think governments can catch up?
18:14
I think governments are so far behind the innovation cycle.
18:14
And again, I'm not picking on the US government here.
18:20
In fact, if any government, even had the potential to do that, well, they'd probably be some of those ex east European states.
18:26
So government is a really slow changing thing.
18:34
Our public school system is a relic of the industrial age.
18:34
And basically it was so that you would train people that they would sit quietly in our room for eight hours, getting them ready for the factory.
18:46
What do you think about government and its ability to change enough to coherently regulate what's going on?
18:54
Jesse Livermore: That's a great question.
18:58
So I think where I would start there is to just point out that I think any individual and any organization is going to respond to incentives.
19:03
And one of the critical incentives for individuals and for an organization is to continue to exist, to continue to prosper, to continue to be.
19:16
And I think that applies to government.
19:16
And government organizations and government entities, they want to continue to be what they are.
19:20
They want to continue to have the power that they have, the positions that they...
19:24
The people in those positions want to keep their jobs.
19:27
They want to keep the organization intact.
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And the things that affect that, they are going to be interested in doing that.
19:30
Now, any organization is like that.
19:30
A corporation wants to stay a full load.
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It wants to be prosperous.
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It wants to continue to exist. It wants to grow.
19:38
But the key thing about a corporation is that the corporation's incentives are directly tacked onto the market.
19:42
The market is the judge.
19:42
And there's this beautiful system that forces the corporations to do what the public wants.
19:47
Because if they don't, the voting is through the purchasing.
19:52
We're not going to buy your stuff and you're going to go bankrupt.
19:55
Well, there's a little bit of a difference there when you get to the government, because there's a voting process.
19:58
But it's a lot more complicated.
19:58
There's a lot more intermediary layers of complication.
20:05
So people go vote, not with their pocket books, but they vote in an election.
20:09
They're not voting, we don't even know what they're voting for necessarily.
20:09
They're voting on who they like, who they don't like, who makes them feel right.
20:13
As opposed to voting on whether I like a product in a very concrete, specific way.
20:17
Do I buy it or do I not buy it?
20:17
And so because of that, you end up in a situation, and then also, I'm sorry to segue, but the government also has the ability with through power to take control of things and maybe it shouldn't have control over.
20:29
It has the ability to do things in secret.
20:29
Because it's not in that same world as a corporation, it's the actual official source of power in the society.
20:33
It has the ability to do things that the corporation can't.
20:37
And because of that, the connection between the incentive process is a little bit distorted.
20:42
So it's not the same as it is in the corporate sector.
20:46
And so, as a consequence, you don't get the same level of efficiency and the same level of cleanness, in terms of providing the deliverable to the customer.
20:54
And so with the government, it's a lot easier in a government organization to do little things on the side that don't actually add value, that do cost money and then be able to keep that cost in place and not have to be accountable for it, because you can hide it or because nobody's noticing or whatever.
21:07
Whereas that's a lot harder to happen in the corporate sector where everything is measured, everything comes down to the bottom line.
21:15
There's a natural market function.
21:15
So in the case of COVID, it's a perfect setup, because you have incentives perfectly lining up with all...
21:19
In every aspect of the response, the incentives, the incentives were good.
21:23
The incentives were proper.
21:23
So the party that would normally want to provide assistance, which would be the Democrats.
21:28
It likes the idea of government as assistance.
21:32
That party controlled one chamber or controlled a certain portion in the house.
21:38
Then you had the party that was in power that would actually cared about the result that might have otherwise been a little bit more averse to the idea of spending money.
21:46
They were actually in power now.
21:46
So they have to stay in power.
21:46
You have the election for Trump.
21:49
So then there's that incentive that's working to keep the willingness to spend, to get out of the problem.
21:54
And there's no boogieman.
21:54
There's no speculator who caused the big collapse that is now going to get rewarded by a bailout, that you have to worry about in terms of how that might affect people's emotions.
22:02
It's this virus that came out of nowhere that no one is responsible for.
22:06
So there's none of that to complicate the electoral thought process.
22:06
And the bad actors don't have that, that they can latch onto.
22:12
So maybe if it was 2008, the bad actors in the political realm might have tried to make it a moral story about how banks were doing this, or how homeowners were over borrowing, or how people were being irresponsible, and they could use those narratives to play their own benefit.
22:26
You didn't have that here. You had nothing.
22:26
And so, it's almost like all of the incentives, in every respect, lined up for a perfect response.
22:30
I don't think we should expect that in every situation.
22:35
That was a very unique situation that happened.
22:41
And if you had changed a couple variables, you would've gotten a totally different outcome.
22:45
For example, I guarantee you, and I don't want to get political, but if you had had COVID in 2011, it would've been a very different outcome.
22:51
The policy response would've been very different.
22:51
Now, part of the reason why, in fairness, is that over the period from the great financial crisis to now, we've learned a lot about fiscal policy.
23:01
We've learned that a lot of the conventional thoughts that we used to have about what the limits were, that those were actually wrong.
23:08
We didn't have that in 2011, but even if you discount that fact, the political environment at that time would not have supported the response that we got because the party that was the... The GOP owned us.
23:16
One branch of government, right?
23:16
They are already averse to the idea of spending.
23:20
The party that would want to spend, therefore, would not have the ability to do so.
23:24
And so, if you wanted to come in and enter that situation as a politician, you could have said, "No, we're going to break the budget.
23:27
We're going to destroy the future for our kids."
23:31
You could have gone into all of that stuff and it would've been a little bit easier because of the way that the incentives would've aligned.
23:34
And so, I don't think you would've gotten the same response if you had had it at a different time in history.
23:37
Or even, let's say, 2001, if you had COVID.
23:41
You think the government's going to spend 20% of GDP to...
23:41
Everything that happened up to now was about experiences, about seeing and learning over time, and that's what helped it. That plus the incentive.
23:50
Jim O'Shaughnessy: Basically, it's an "Only Nixon can go to China" type of argument, right? Jesse Livermore: Right. Yeah.
23:56
Government can do good things, but the incentives to do good things aren't always there.
23:59
They aren't provided in the same way that the market provides them for a corporation.
24:03
If you're a corporation, it's hard to...
24:03
I mean, there're things that you can do as a corporation that don't add value, but at a minimum, they add demand.
24:09
They create demand for what you have, for what you're selling.
24:09
And the easiest way to create a product, something that's going to sell, is to create a product that actually has value.
24:14
You can play games, you can go around the normal process.
24:18
Sometimes it's illegal and that's why we have a government to try to stop that, manipulation of people's psyches and stuff like that or fraud.
24:26
But you have a clean connection between what you're providing to the customer and what you're getting back in return.
24:30
In the government, you don't have that and it's complicated by the structure of government.
24:34
And only in those cases where the incentives and the processes that are driving things where they properly align are you going to get the immaculate response that you got in 2020.
24:45
And I want to say, some people might disagree that it was the right response.
24:50
I mean, I think we both agree that it probably was because look at the result.
24:50
I mean, it's working, but you wouldn't have got what you got in that situation if you had not had the initial conditions that you had which were unique to that period. Jim O'Shaughnessy: Yeah. Do you see either...
25:00
Because one of the things that troubles me is that when I look at government and I look at private enterprise, the government is so far behind the curve of private enterprise.
25:11
I mean, like I mentioned earlier, public school, that's from a relic of the industrial era.
25:19
Banking regulations, et cetera, the SEC right now, has no idea, in my opinion, how to regulate all of these new innovations that should be properly regulated by the SEC and some other government institutions.
25:38
Healthcare is another one.
25:38
I mean, it's from the 1930s.
25:38
And there are so many innovations...
25:44
I just wondered, you think, "Is there a third part on the horizon?
25:44
Is there a public private ability to work out a plan that might be ever changing?
25:51
Or do you think that we're going to grind along and be in stasis?"
25:59
Jesse Livermore: If you have to make a choice, I think the way you start this problem is you just get the government out.
26:03
In other words, if you can create a solution that doesn't require this, that doesn't require this kind of external regulation, that's always better, because in my experience, it's just very difficult to have the incentives line. Let me give an example.
26:11
If you're a regulator, you're thinking in terms, again, your own incentives.
26:17
And so, if you already have an established system that has already been approved, if you change that system and something bad happens, the person who changed is going to get looked at, is going to be put under the microscope.
26:27
And so, you to overcome that threshold just to get a change. And it involves work. Why do it?
26:31
And ultimately, if you're a company and you're not optimizing things, then the CEO who is the ruler of the company, basically, is not doing as well as he or she could, and then that individual has the ability as the hammer to come in and do whatever has to be done.
26:49
And all of his incentives aligned to it because he doesn't really have any direct fiduciary responsibility to...
26:54
I mean, he has a moral responsibility to his employees, but he doesn't have from an economic perspective and in terms of the way the rules are written.
27:02
Nothing stops him from letting somebody go, from changing around positions, from giving orders, from doing that type of thing to make the system produce what it needs to produce and to optimize the outcome.
27:12
In the government, you've got so much built in intentional stuff to slow that down.
27:17
That's probably part of the problem, is that it's entrenched.
27:22
The parts of the US government are entrenched and the people...
27:22
There are structures that are built into the government to prevent forced change because change is uncomfortable.
27:30
With that said, I don't think that it's going to be something that's going to change.
27:30
I mean, the way that changes is when you have political consensus and the Congress to come in with the President to pass a bill, to basically come in and engineer...
27:38
So then you have to get into politics again.
27:42
That's not going to end.
27:42
It's always going to be like that.
27:45
I think that the real innovative progress related solutions are going to be those that don't require the government to get involved in the first place as a regulator or as a police officer.
27:51
I mean, if they are going to get involved, it needs to be, hopefully, in black and white situations, very clear situations where it's obvious that right and wrong is happening.
28:00
You don't want to be in an industry where the industry needs the government for every move it makes.
28:04
It's not going to go well.
28:09
It's going to be very expensive.
28:09
Jim O'Shaughnessy: It almost sounds as if we've created these echo chambers in social media.
28:17
I think there's a way to mitigate that somewhat with some technology solutions, with some other solutions as well, but it seems to me, because the other thing, because I've been really looking into this, that periods of really, really tons of change, chaotic [inaudible].
28:36
You've got Lord Whitehead basically saying, who was a British historian, "Times of great chaos are almost always leading to golden ages."
28:42
And I want to be really careful with that term because there's going to be a lot of problems too, like government, because it's like this monolithic, unchanging, and basically with the ability not to change.
28:56
And so then, it becomes, if you're going to be a weaver of stories and narratives, then it's going to be the Tech Overlords versus the Government Overlords. Bad things will happen. Let's move on to... Go ahead. Jamie Catherwood: Sorry.
29:15
One interesting angle on this is...
29:19
Carlota Perez who wrote the Technological Revolutions book and Financial Capital, she talks about how throughout history and all these technological revolutions, one of which was the one Chris Meredith covered in his paper, Value is Dead, she writes about how progression goes from bubble age to gilded age.
29:38
And then, after that crash when the market crashes and whatever the new innovation is of that era, money comes crashing back down to reality and there's less speculation. But now, people...
29:53
The footings have been more equalized because the people who got really rich during that gilded and bubble age are now poor.
29:57
That's when the government tends to come in and have a much more active role and...
30:03
I don't know if forcefully is right word, but sternly, I guess, redistributes that wealth and technology or innovation across the economy more broadly, rather than just being siloed in whatever the innovation or whatever that sector is, whether it be the automobile, et cetera.
30:20
And so, the argument is that after this gilded age where the people who are involved in whatever that era's innovation is, become rich, and then, there's a crash, that's when the government can be more active.
30:31
And it feels like we're somewhere in that stage now and COVID would be the crash that brought people back to reality.
30:37
But then also, there's been years of this innovation siloed in the tech sector where those corporations and people involved have been getting much wealthier and richer while other areas of the economy are faltering.
30:53
And now, we have an administration that's much more active.
30:53
Another interesting angle for this, going back to what Jesse was saying...
30:58
for this, going back to what Jesse was saying... In this course that I just launched, I was talking to Mark Andreeson about this, and the point that he was making is that he thinks, in terms of the antitrust and regulation because the new administration's argument is that
31:14
[inaudible] argument is that these tech companies today, the massive ones, are stifling innovation by just buying out the competition at early stages so you don't get the natural unseating of the dominant players because they're just snapping up all the little ones. And I wrote the Carlota
31:27
And I wrote the Carlota Perez point, and he's saying the difference then was in that area, the previous trust busting regulation era that followed the actual gilded age in the late 1800s, that each product was one singular thing, so standard oil, it was oil, oil, oil.
31:45
With [inaudible], it was steel, steel, steel.
31:50
There wasn't a new oil or steel coming out every year, but with these companies today, there's all these innovations and iterations upon software products.
31:55
And when it comes to regulation, he pointed out that it's conflicting agenda between the government and regulation, where from an antitrust perspective, they want the companies to stop buying up the competition so that there's as much innovation as possible.
32:14
And so, that keeps the incentive for people to keep starting new companies and trying to take on the big players to unseat them and they'll be protected because the government won't let them just be bought out and reduce competition.
32:24
But then at the other side of the equation, there's this more active state role trying to come in and redistribute this wealth and even the playing field, but that involves taking on those big players.
32:36
And so, you're having a conflicting agenda.
32:43
Jim O'Shaughnessy: You missed the introduction and part of the thesis that I wanted Jesse to speculate on, is that we are literally in the exponential age.
32:50
And I gave as an example that Amazon's R and D for 2020 was 36 billion, and that 10 years earlier, it had been 1. 2 billion.
32:58
And so, trying to fit this, and you know how much I love history, Jamie, but trying to fit it into the context of some of the historical and accedence that we face, gets a little trickier in my opinion, for the reason that exponential change is very different than linear change, and standard oil was a lot easier to hate than old man Rockefeller, than Amazon, which everyone loves. Everyone loves Amazon. Everyone uses Amazon.
33:36
And so, for the government to go after Amazon, the citizenry probably wouldn't be very happy about that. Jesse, what do you...
33:42
Jesse Livermore: I think that's a really important point.
33:44
It's almost like corporations are becoming government-like, in terms of...
33:47
Not democratic government-like, but government-like in terms of an autocratic government.
33:51
I mean, if you think about a company like Amazon that has been...
33:51
It's almost too big to control because the influence is so powerful.
33:55
I mean, the way that a corporation like that can affect the system if there's a law that's passed that the corporation doesn't like and it harms the product output, that's going to be a huge incentive, politically, in terms of the cost of that, in terms of whether it's going to be popular or not.
34:13
I mean, regulators, obviously...
34:13
I think regulators are good public servants and they want to do what's right. It's just...
34:15
The reason why I'm skeptical that all these things are going to be solved is that it's just very hard.
34:19
It's very hard to use the systems that we have in place in the United States, the structure that we have to drive government governmental change, it's very hard.
34:27
And it's a lot easier, for example, in places like China because it's an autocratic government that just does what it wants whenever it wants. It responds to the...
34:36
The incentive is to keep the population employed, keep the population happy and you got one guy making the call.
34:38
In the United States, we've engineered these mechanisms of discord and dissent and plurality into the process for a good reason because that's how you stop the other part of the problem, which is the government gets too strong.
34:52
We've engineered that into the system and that makes it very hard to solve these kinds of problems at that level.
34:56
I think that more antitrust action against those companies would be warranted in certain situations, but for some of the reasons that you mentioned and also for other reasons, I don't think it's going to happen.
35:04
I mean, that's just a political...
35:04
People make noise about that, but if you think that you're going to break up Google, what are you going to do with the website?
35:11
And here's the thing, you could take a company like Google, and you could say you're going to become five Googles.
35:14
You're going to become like what happened with Exxon.
35:18
But eventually, if you name them something different and you make them all isolated, then eventually, we're all going to migrate towards one of them which is the one that has the most people using it, that has the best data coming out of it.
35:26
You can cut off the limb of this thing but it's just going to grow back.
35:30
You can start cutting off parts, but it's like, you're going to get back to a place where you have a "winner take all" situation again.
35:36
One thing that I was thinking about, as a solution for Google specifically, was if you somehow said, there's now five Googles and whenever you type in the word, google.
35:41
com, computer algorithm randomly will pick which Google, which company it goes to.
35:45
And then, you can choose to advertise on one of those five companies.
35:53
In other words, something like that and then you can have them compete with each other for rates.
35:56
That's all I can think of, because otherwise, if you just said, one of them's called Google A, one of them's called Google B, one of them's called Google C, which one are we going to all go to?
36:03
We're going to probably all start using Google A first.
36:03
And then, it's going to have better data because it's going to have more users, more people that are coming into it system.
36:10
And it's going to have the scale that comes from that and the "winner take all" dynamic.
36:10
We're going to be back to where we started.
36:14
The rest of them are going to die and that was going to [inaudible] and become the new Google.
36:18
Jim O'Shaughnessy: Yeah, I agree.
36:22
And so, just another point to Jamie's point, another thing that happens... I live through the.
36:28
com boom and crash, but what a lot of people forget about is that, for example, fiber optics.
36:34
People spent ludicrous sums of money laying all of this cable.
36:34
And then people, after the crash, it didn't negate value of those fiber optics.
36:42
And other people came along and were like, "Yeah, I'd like to buy that.
36:48
You paid how much for it?
36:48
Yeah, we'll give you two cents on the dollar."
36:54
In a way, it's very painful, obviously, when crashes happen because investors get burned and all of that happens, but it's not like the innovations and or the technologies that were interesting disappear.
37:07
There's still [crosstalk]. Yeah, great example. And cars.
37:07
What, there were 200 automobile manufacturers in America in 1900? Something like that.
37:10
And Jamie had a post making the point that it wasn't just gas.
37:19
Jamie: Most of them were electric.
37:21
Jim O'Shaughnessy: Right, yeah. They were electric.
37:22
Jamie: They outnumbered gas until 1912.
37:24
Jim O'Shaughnessy: Which is fascinating.
37:26
I've always said that if you really...
37:26
If you want to make movies or write screenplays, just read history.
37:31
I mean, literally, The Da Vinci Code, you can...
37:31
That's a French family that claimed that it was descendant from Jesus Christ directly, and that's history.
37:41
Men in Black, when you read the accounts of people who showed up at UFO sites in the forties and fifties, guess what was the one common thing they all said?
37:48
They all said, "We got there really fast, but then this other car came up and all the guys in black suits got out."
38:03
It's always good to study history, but I think that what's better to study is human beings and our reactions to things.
38:07
Because history itself is...
38:07
Maybe doesn't even run, because we're talking about a change from a linear to a non-linear, a change just from steady progress to exponential change.
38:20
Maybe we can't find basic, really good comparisons historically, but maybe what we can understand is the way human beings react to these things.
38:32
One of the things that I worried about is... Let's look...
38:32
Because I also wanted to get your input on this, Jesse.
38:37
Public education, it's a travesty.
38:37
I mean, it literally is not educating children for what even remotely they need to learn.
38:46
And how does that get changed or is that just a...
38:46
Because that's more of a local government thing, right?
38:52
You got anything for me, Jesse?
38:56
Jesse Livermore: I don't want to sound like I'm anti-government in sense of the people that run government want to do good.
38:57
They want to do good for society.
39:02
They want do good for the world.
39:02
It's just that, again, the incentives get mixed up and then you don't...
39:06
You can get outcomes that don't work.
39:06
And so, like with teaching, with education...
39:09
I mean, first of all, we don't even all agree on what the deliverable actually is.
39:09
If you go to every parent and say, "What do you want your kid to get a school?"
39:13
One parent might say, "I want them to learn and to learn how to think critically."
39:18
Another might say, "I want them to get good grades so that they can get into college and get the status points that come with that."
39:26
There're all kinds of things that are happening in education world.
39:26
It's not a clear deliverable.
39:30
And as a consequence, you don't have agreement on what the deliverable is.
39:30
And so therefore, you can't test for it and build structure that incentivize it.
39:33
For example, I remember...
39:33
I'm not an expert on this, but back when George W.
39:37
Bush had the "No Child Left Behind" thing, I remember when I was a grad student, a lot of the people were complaining about the effect that that was having because it was creating a standardized testing obsession where all anybody wanted to do was focus on the standardized test that was the deliverable.
39:50
If you make something into a metric that's used for evaluating and grading things, then that thing becomes the focus of everything and it takes over the entire process.
39:58
The entire school year was about trying to get the students prepped for the test so they can do well on the test [inaudible] the teacher gets the points that come with that and the incentives, the salary incentives, that would follow.
40:08
We don't even agree on what the goal is, so how are we going to solve that problem?
40:12
I think there's a lot of interesting things that are happening at least on the...
40:12
And I'm not an expert on this but it's just on the teaching side itself, the idea of learning how to teach better.
40:21
I've seen a lot of podcasters.
40:21
There's this one podcaster that I've seen multiple times.
40:24
Her name is Ana Lorena Fabrega [crosstalk].
40:24
I mean, that type of stuff is exciting to me and I think that's right on because if we agree that the goal is to make people more intelligent and more functional in the world, then there's a better way to do it than the way that we're doing it.
40:40
The problem that I don't know what the solution for is, is the problem of how you make sure that you incentivize that properly where you don't have a market.
40:44
Particularly, in public schooling, you don't have a market in the same way that you would maybe in private schooling, but there's that.
40:53
And then one other thing, I know I'm throwing a lot of ideas out, but another thing that just pops up that just becomes so hard to solve is that we don't even care about education.
41:00
Nobody cares about education.
41:00
We care about making money and we care about being employable.
41:00
And so, all of these status-based structures start to arise around that.
41:06
And that's what the real goal is in education, I would argue, for a lot of people.
41:10
I mean, for myself, when I was in high school and in college, I wasn't sitting through class because I cared about what the teacher was talking about.
41:18
I was sitting through class because I wanted to get the degree or the diploma so that I could get into a good college so that I could then get a good job.
41:23
The entire system is captured in that process.
41:27
And so, even if all schooling was private schooling, you would still have problems with efficiency because the thing that would be efficiently targeted in a market system would be the thing that people are trying to get which is the status points.
41:42
The status points aren't...
41:42
They are tied to actual performance only in a very loose, legacy, historical way.
41:48
People that went to Harvard, my experience is that they tend to be smarter, so therefore, I want to be someone who went to Harvard.
41:53
Or people that went to this school maybe weren't...
41:56
They don't do as well or they do better.
41:56
Do you see what I'm saying? It becomes...
42:01
The feedback process between in the credential that you're pursuing, the quality that it has in the market, and the actual quality of the people that have that credential is very, very weak and it's a slow moving process.
42:11
If the educational standards at the Ivy League schools were to drop significantly, it would take a long time to undo the perception that people that go to Ivy League schools tend to be smarter than people that don't or tend to be better employees or whatever.
42:25
And I don't want to say that's even true, but the standard stereotype that people have, "I went to Harvard, et cetera."
42:28
I don't even know where to begin.
42:28
I mean, in terms of solutions, I don't have any for you, unfortunately.
42:33
I think I understand what the problem is and I think it's still a problem because there are no solutions.
42:37
People care about this stuff and they've cared about it for a long time, but what do you do?
42:40
I think one thing that's interesting is that Google has talked about possibly trying to disrupt higher education and create their own college process that is much more efficient where you learn what you need to learn and you don't have all these ancillary expenses for unnecessary overhead and this big grand experience of going to some hugely costly resort location that you're going to spend four years at.
43:05
There's a lot of inefficiency in that.
43:05
It's a lot of money that’s spent that goes into student debt that doesn't need to deliver something that would prove to corporations that you are competent. Jim O'Shaughnessy: Yeah.
43:15
Jesse Livermore: So there's an incentive maybe for Google, but see, Google has to create the diploma that isn't a mic diploma. They have to create.
43:20
Because again, it's all about status.
43:20
It's all about using the signaling of what that diploma provides.
43:24
So how are they going to be able to create an online education type degree/certification process that's super-efficient for what you want to do in the corporate world that carries with it the signaling value that a four-year degree carry.
43:41
That's going to be hard and it's going to be hard to build that from scratch.
43:41
Maybe we go back to crypto, building a currency, right?
43:45
You're trying to build a currency out of nowhere.
43:49
Jim O'Shaughnessy: So that's one of my themes that we will see a steady erosion of the status points that are given to say college degrees.
43:51
So for example, I have a degree in economics which suggests competence, right?
44:00
That's all it really does.
44:06
I could get a college degree, and I'm specifically not talking about doctors and people who really need to have deep understanding of their particular thing.
44:12
There I think degrees and status and everything else will remain very, very high.
44:17
But I also think we're moving and that's the idea that I've been exploring.
44:23
We're moving from a period where those things mattered a lot to a period where, I've often said, I think Twitter has a chance to become the world's first continuous global intelligence network.
44:36
And you also have the ability to demonstrate competence in social media and or in things that you are doing.
44:42
Now clearly, I'm not saying go to college.
44:49
I think there are a lot of beneficial things that you get from going to college, but some people maybe shouldn't go for a specific thing if they want to do other things.
44:58
I just think of the old joke where a lawyer hires a plumber to come and fix his toilet.
45:05
And the plumber comes downstairs after being up there for two hours and says, "Yeah, we're all set."
45:10
And the lawyer goes, " Okay, how much do I owe you?"
45:10
And the plumber says, "You owe me $1,000." And he goes, "What?
45:14
You're charging me $500 an hour?"
45:14
And the plumber's like, "Yeah.
45:22
That's what the market is willing to pay."
45:22
And the lawyer goes, "Well, that's insane.
45:22
I don't even bill at $500 an hour."
45:28
And the plumber says, "Yeah, I didn't either when I was a lawyer."
45:28
So I believe that the world we're going into and all the names that we talked about, right?
45:35
The oasis, the metaverse, whatever you want to call it, is going to probably slowly, because lots of changes happen slowly over time because people adapt them and they understand them.
45:49
But for the early learners, I think it's going to provide a ridiculous amount of leverage.
45:57
And I think that it's also opened up job opportunities for a billion people who didn't have them before.
46:10
[inaudible 00:03:41], one of my colleagues here at Infinite Loops, he lives in India and he basically demonstrated his confidence before I hired him.
46:18
I followed him for a year and I watched what he did.
46:21
And now he's got to prove himself with everything he does.
46:21
It's just like we're back to your ability of what you gave as the example about the CEO.
46:29
The market is a very harsh mistress and it's like you either do the job or you're done. Goodbye.
46:35
But let's get back to just some practicalities on things like education again.
46:41
Because the other thing I like to think a lot about is what are the opportunities here?
46:45
Is there an opportunity for a business.
46:50
You guys are both too young but I can't remember his first name, I think it was Chris Whittle came up with this brand new way of education and he raised a lot of money and then he [inaudible].
47:01
So is there a company here that, and Jamie you might know of a couple of them who are very successful. What is it? Khan Academy.
47:07
I didn't do any homework on this.
47:07
Are there others that are actually for profit that you know of or no?
47:14
Jesse Livermore: For just teaching? Jim O'Shaughnessy: Yeah.
47:19
For coursework, for I want to learn how to code.
47:19
I want to learn- Jamie Catherwood: Teachable. Jim O'Shaughnessy: Yeah. Teachable.
47:27
Jamie Catherwood: Teachable. Yeah.
47:27
Not to just plug but that's the first that comes to mind.
47:29
That's where I do my course.
47:29
I think that's where David Perell does his course. There's Coursera. Jim O'Shaughnessy: Okay.
47:35
But this is really a good example because you have a great course.
47:35
You're on your second one now and you use teachable and it's like, so give me an opinion.
47:42
Could somebody get a great education from that if they were dedicated and persevered through things that might not interest them totally or no?
47:55
Jamie Catherwood: Yeah, I think so.
47:56
I think where it falls short is just the seeking.
47:56
If you need help, it's a very static.
48:03
You have the courses and you have the lectures you can go through.
48:08
For me, I was godawful at science in high school.
48:08
Both sides of my family terrible at science.
48:13
My dad was the bottom of his class in physics in high school and I had to go to get help basically for every project in physics because my brain just did not process it.
48:23
And so if I was trying to do a mandatory physics course with just one prerecorded thing, I could not then seek explanation in a way that I understood, then that would not go well and I would not be able to scrap out a B.
48:36
Jim O'Shaughnessy: Exactly.
48:39
And Jesse, without giving anything away, you probably know a little bit more about science than both Jamie and me, right?
48:44
Jesse Livermore: A little bit.
48:47
Jim O'Shaughnessy: We're not giving anything away.
48:50
Let's leave it there that you probably know a little bit more about science.
48:55
Jesse Livermore: You have a great point.
48:56
Just as you're saying this now I'm thinking, I think the special thing about coding, I've seen a lot of companies that they teach you how to code and they seem to be the most promising of the opportunities.
49:03
And I think part of the reason for that is that if you think about coding, coding is a very objectively measurable process.
49:07
The ability to code is something that's very easy to assess.
49:11
And so what is the company trying to do?
49:11
It's trying to create a credential that is a bridge between employees and companies and they act as almost an investment bank intermediary that says, "Okay, I'm going to credentialize you based on your ability to do this thing that the company needs.
49:28
" And that's going to give the company a quick way to be able to assess, okay, this employee is someone we should hire or not.
49:31
And the key feature of that is the fact that it's measurable.
49:34
The thing the company wants is very easy for the intermediary to measure, the trust entity to measure and credentialize and then to teach.
49:43
So then they focus on making it so that you are able to reach the level of competency and functionality in coding that the company's going to need and that's going to build the value of the credential up and then create an incentive for the potential employees to want to get the credential.
49:58
But if you think about some management, how do you credentialize management ability?
50:03
How do you credentialize teaching ability as a teacher.
50:03
Those are very difficult to credentialize and so you get stuck and then you get into these the same games where we end up going back into using the college degree now as a measure of "general intelligence".
50:13
Not just the college degree but the entire 18 year or 22 year process of education that had to be put into you to be able to get through the Ivy League to get the degree.
50:24
That type of thing is now being used as a proxy because it's the best we have.
50:29
It's the best that an employer has to be able to assess these very high level talents that are going to be needed for a good hire.
50:33
And so I think the special thing about coding is this objective.
50:39
If you take away the objectivity of a process and you make it management or you make it creativity, those things are going to be very, very difficult to solve with the same techniques and those are things that we need too.
50:48
We don't just need [inaudible 01:03:53]. Jim O'Shaughnessy: Yeah. So that's interesting. I have two thoughts.
50:55
So for example, right now in asset management, you could have a legitimate argument, what was more valuable, an MBA or a CFA, a certified financial analyst.
51:08
And then they hired somebody who was a marketing wiz and he or she created this huge demand for CFAs by making them scarce, very smart.
51:18
The CFA test is designed so the majority fail.
51:28
And somebody really clever either read the book persuasion or hired his company because they hit all of those points that make something highly desirable.
51:34
And I'm just wondering, is that kind of alchemy, my buddy, Roy Sutherland wrote a great book on that.
51:42
Is that kind of alchemy possible? I would think it is.
51:50
But I think you're right.
51:50
I think the answer is, it has to be something that is easy to objectively measure.
51:55
And so there are a lot of jobs and the highest level of jobs that are not easy to objectively measure. Jesse Livermore: Yeah.
52:07
And what happens if you don't have the objective measurability or you don't have something like that, it now becomes possible to have success in giving status to the credential.
52:18
It becomes possible for the organization to be successful in that by doing other things like, for example, we'll use the example of an MBA, we'll pick on the MBA.
52:26
Let's suppose that it's true that a lot of MBAs are totally not anything special. They're just useless.
52:29
You could go online and just read stuff for a couple years and you'd have the same thing.
52:32
I'm not going to say that that's true.
52:32
I've never done it so I can't speak to it, but there's people that believe that.
52:36
If that's true, it's still possible for the MBA to develop status as a credential because you could go around the process.
52:43
If enough people have this degree from this university, this NBA, and they all manage the companies, they're going to want to see that credential so now you're playing another little gimmick game. That's a workaround.
52:51
And so if you don't have something that's objective, that can be objectively measured it becomes much easier to not really be delivering anything except ephemeral vacuous status that just comes out of nowhere.
53:03
If I stamped you right now with an MBA, a Harvard MBA, if it's true that just stamping you with the Harvard MBA would make you more capable of generating income then something's wrong with the credential because there should be some point where, because if I could stamp you right now with an electrical engineering degree and I take you to Intel or to IBM and you're going to start out your first day, it's not going to work.
53:26
Jim O'Shaughnessy: I know.
53:27
Jesse Livermore: If I stamp you with an MBA and you can already waltz into the C-suite and do your thing because you have this MBA, that's a problem, right? Jim O'Shaughnessy: Yeah.
53:34
Jesse Livermore: I'm not saying that's true though because I want to be careful.
53:34
I don't want to insult the MBA, I don't know, I've never done it.
53:36
But if it's the case that just stamping you with this credential is enough to allow you to pass for something then the thing that is being credentialized is not properly measurable and that's why this happened.
53:47
That's why it was possible to work around it like that, to play a game like that.
53:52
Because the thing that was actually being met, it was very difficult to measure and so nobody notices, or maybe there's nothing there at all. Jim O'Shaughnessy: Yeah.
53:59
So that leads me into another question I had for you which is, as I look at this thing coming along and we're in the early innings honestly I think now.
54:07
So I think that there's going to be a group in society, again worldwide, not just in the United States or North America, where people for the first time ever, and this is important, through no fault of their own will not be able to scale up, will not be able to switch out of linear thought or their customary ways of doing things.
54:33
And so I changed my opinion on universal, basic income.
54:41
So A, do you think that there are other things that we could try to help that group along?
54:41
And Jamie, you can jump in here too. Jesse Livermore: Yeah.
54:49
That's a really good question and I have a couple things to say on that.
54:49
So I tend to be in the camp of people that I don't just think the value of a job is the income.
54:56
The universal basic income can solve the income part but it can't solve the contribution, productivity, having a purpose, having a reason to get up part, feeling like you're adding value to the world around you, that you are valued, that you have something to contribute.
55:10
You need a job for that or some inter interaction with the world.
55:10
And that's going to be a challenge.
55:14
I think I can say this as someone who was in the military, I'll say this, a lot of the military is actually, I'm going to be careful saying this, don't take this the wrong way.
55:23
A lot of the military is actually just a make work situation.
55:23
If we're not at war, we're not really doing a whole lot except training for something that isn't really happening.
55:28
And there isn't really a customer that's up front right there that's going to be angry if something doesn't get delivered.
55:37
If a certain military unit is not ready for war, no one's going to know until the war.
55:42
And you can put as many people as you want in this entity and everything will be fine if you're willing to pay for it. It's the government.
55:46
I think things like that have value.
55:46
Jobs like that where you don't necessarily have to have a direct value add to the immediate consumer economy which is what's hard to create because that's the problem that you're speaking of is, not everybody's going to be able to produce in the way that the consumer economy wants and add value in the technological world in the way that we need.
56:07
Not everybody's going to be able to take their skillsets and do something that the consumer benefits from that then becomes valuable to a corporation and a reason to hire somebody because you're going to get profit. So what do you do?
56:20
You can have a universal, basic income but I think you need something more than that.
56:20
You need some way to keep people gainfully active as part of organizations.
56:24
Now you can get that privately without manufactured structures like make work jobs.
56:30
But I think that there's an argument for what I would call make work jobs.
56:35
Jobs that don't really actually involve producing anything that is needed but are valuable because they give people the ability to be part of something, to have to get up and meet a deadline.
56:45
To have to have peers to compete with, to have things that motivate them to do well.
56:49
Because there's people in the military that are motivated to do well, even when we're not in a war because there's an entire value system that's been built up around performance.
56:58
And there is no actual deliverable to a customer at that moment but there's a a criteria of performance that's set up.
57:03
And even though maybe we had too many people in the military, you wouldn't know.
57:07
If it was the case that right now we had too many people in the military, you wouldn't even know. There's no way to know.
57:12
Maybe some think tank person might know.
57:18
But the people that are doing the job, they're not going to know that, they're not going to know that they aren't necessary, that they aren't needed, and it's not going to affect their ability to derive value from the job itself, from the training, from the competition process, from the growth process that is involved in being in that job.
57:28
So it works and we've had plenty of times in our history where we've probably had too many people in the military.
57:37
Jim O'Shaughnessy: So what I hear you saying is, yes, we can address the income part but your personal experience and those that you've observed would argue strongly on behalf of the fact that that's just part of the equation, the income part, that people in general, and I probably agree with this, need a sense of purpose to make themselves feel good about themselves.
57:58
Last week's guest is currently getting his PhD in psychology at Cambridge and is a Yale graduate and literally his name is Rob Henderson.
58:03
And he spent his early youth in foster care.
58:12
And if you know anything about these statistics around foster care, they're not pretty for are the people who are in it.
58:20
And Rob said on our podcast that he credits the air force with turning him around.
58:26
He decided at I think age 18, that he was, his own words, "I was a fuck-up.
58:33
I didn't care about things."
58:33
And so he said in a lucid moment, "I thought what I need is someone to really discipline me."
58:41
And he chose the Air Force and guess what? They did that.
58:46
And so he thinks that it helped him.
58:46
So Israel has required, what is it?
58:55
Two year in the military.
58:55
Switzerland requires that every homeowner have a gun to defend Switzerland should someone decide that they want to own [crosstalk 01:15:26]. Yeah.
59:01
If somebody decides that they want all of the best chocolates in the world and they're willing to march for it, yeah.
59:08
An FDR course during the depression had the public works deals where, if you drive down the merit Parkway, my neck of the woods, one of the things that you'll say is, man, those bridges are incredibly beautiful.
59:18
Well they are because during FDR's depression, artists built them and made them very, very artistic.
59:26
Do you think that there's enough latitude?
59:26
And I'd be interested in first, Jesse, but Jamie I'd be interested in yours too as a young guy. Jesse.
59:37
Jesse Livermore: I take the question to be, is there a way to create an organization like that that would produce something that actually is valued. I think so.
59:44
I would be a little bit skeptical of any proposal obviously because I would be wondering who's going to benefit from this.
59:48
This is going to be an excuse to do nothing, but a public service core or a public works core, some sort of government entity that takes idle labor and make stuff with it in a dignified way.
1:00:00
You don't want to develop a reputation for being like, oh, that's where you go when you're not high status.
1:00:05
Jim O'Shaughnessy: Right.
1:00:07
Jesse Livermore: The military has a unique situation because the military has a storied history and a legacy and all that stuff and that's what keeps people from thinking that, oh, you joined the military, you must have just had nothing better to do.
1:00:16
Jim O'Shaughnessy: And sorry, but just to interject, it's the only public institution that still has a majority of the public support, at least in the United States. Jesse Livermore: Right.
1:00:24
Still the problem with the military as the place for this would be that you're just wasting a resource because if all the people are going to be doing is basically pretending like they're a war with each other and that's not needed by anyone, that's not going to do anything.
1:00:36
So I guess you could probably think of trying to create some public service core, some public works core, charitable entity that does the same type of thing in terms of addressing humanitarian problems domestically.
1:00:48
I think that's probably what most people would think would be the natural candidate, something like that like Teach for America type thing.
1:00:52
Something that directs in a charitable way these resources, provides an income and also directs the talents and the skillsets towards some public good that maybe the market would miss.
1:01:03
Because that's another valuable aspect is, if a market's already solving that need and you don't want to have some other entity that just goes in there and distorts it, you want something that doesn't have a market solution, that doesn't have, I don't know.
1:01:14
As I'm thinking about it right now, I don't know of any...
1:01:14
Humanitarian things stand out to me in my mind.
1:01:16
Things like that, helping people that are homeless, cleaning things up.
1:01:20
I want to be careful how I say this though because I don't want this to sound like some sort of, it's almost like it's a make work job that ends up doing all the stuff that nobody wants to do, right?
1:01:27
Jim O'Shaughnessy: Right.
1:01:28
Jesse Livermore: You don't want that.
1:01:28
But something like that that involves public contribution would be valuable in my opinion.
1:01:32
Jim O'Shaughnessy: And I think the way you frame it you, you bring in the idea of status which a lot of people fail to think about.
1:01:38
And I think that that's a good mix in there.
1:01:38
Jamie you're young but you also know a ton about history and the various attempts that have been made, at least in this country for similar type of organizations.
1:01:49
You have any opinion on this?
1:01:54
Jamie Catherwood: So I don't think I'll do a better job giving my opinion than Jesse did from that angle so I would give a slightly different angle which is towards the same goal.
1:02:03
Going back to the railroad example earlier, I think that there is an opportunity to create a, I don't know, it wouldn't be an organization but I think one of the best aspects of the railroad boom in the 19th century was that it combined government incentive with our just human nature and speculative tendencies.
1:02:20
So the government provided the incentive for railroad construction and the formation of railroad companies by saying, if you build X miles of track, you get X miles of plots of land, which you can sell but also we'll just give you straight cash for every mile of track you lay.
1:02:36
So obviously people that wanted to get wealthy took up that offer and started putting together companies.
1:02:43
And as some of those companies made a ton of money, then speculators did what they always do and they chased into these stocks and there's this national fever for railroad mania and the land around it and it brought up the value and interests in areas around the country as railroad got laid in these towns and build these mini economies.
1:03:05
and build these mini economies. And I think that there's something to that which should be looked at today where I don't know what the kind of national project would be, but something
1:03:16
where the government can provide the incentive for a private investment and private sector to take over the actual construction of management of it, but doing so in a way that excites the public and provides an opportunity for them to get involved and release the speculative tendencies that we all have. Yeah. It just seems like... Jim O'Shaughnessy: Yeah. It just seems like... Jim O'Shaughnessy: Yeah.
1:03:36
I think I agree with you, and again, having kind of lived through that, first off, I think people who say the government is worthless, have no idea of history, because many of our things that we take for granted today, including the internet, including a bunch of other things, you know DARPA had its hands all over, and that's the defense department's research division.
1:03:58
And the other thing that just when I was listening to you, Jamie, was the landing on the moon.
1:03:58
I mean, when JFK said that, yeah, he said it for political reasons because the cold war was going on and everything, but from when president Kennedy said that to, when we actually landed on the moon was a ridiculously short period of time.
1:04:16
And then when you consider the fact that the computer power in our iPhones, it's an exponential in terms of how much more powerful these things are.
1:04:29
And like that, Tom Wolf wrote a great book about it, The Right Stuff.
1:04:33
By the way, I think that's a great movie.
1:04:33
If you've never seen it, it's an old one.
1:04:37
It's really, really good.
1:04:37
But that really captured the public's imagination, and everybody was on pins and needles right when this stuff was going on.
1:04:45
Do you have any ideas, either of you, Jesse or Jamie?
1:04:51
I mean, what do you guys think could generate that kind of excitement in the general public today?
1:04:56
Jesse, I'm looking at you.
1:04:56
Jesse Livermore: I mean, I really am at a lot, like...
1:04:59
Jamie: Well, I've got one, if you want to keep thinking. Jesse Livermore: Yeah. Jamie save me. I don't think I have... Jim O'Shaughnessy: Okay.
1:05:02
So Jamie's going to save you in the, and you're going to think of one though, Jesse. I know. I know that'll happen.
1:05:05
Jamie: So the first one that comes to mind is climate related, and this isn't just going to be a preachy kind of ESG thing, but the kind of, I guess loose example of what went on with the railroad example in the last year and a half is all the EV SPACs that went public.
1:05:18
That was an example where, whether or not we have Nicola and all these kind of sketchy cases of the actual underlying companies.
1:05:30
It showed that if you give investors an opportunity to speculate on getting rich quickly through investing in stocks, and this was via SPACs, then they will get very enthusiastic about something like an electric vehicle, which also benefits the environment and is something that would benefit us all long term.
1:05:49
And so I think that is the perfect example of kind of, we can get a lot of support and interest behind something that would be beneficial to society as a whole.
1:06:02
That's the first one that comes to mind. Jim O'Shaughnessy: Yeah. Okay. I just wonder, okay.
1:06:04
So I was nine years old when they landed on the moon.
1:06:04
So I kind of remember watching it, not really.
1:06:10
I think I remember what my mom told me about it, but I don't know if electronic vehicles like really ignite the public imagination.
1:06:16
Now I know that Musk has been very successful at manipulating the public's fondness for these innovations.
1:06:24
So maybe, but I'm just wondering, I don't know, cause... Go ahead.
1:06:31
Jesse Livermore: All the solutions that I can think of, this is kind of the problem I'm having is that, to Jamie's point around climate, that's one that pops up right, is the idea of, of mobilizing everyone around the idea of fighting climate change.
1:06:43
But if you really think about it, like an electric vehicle, we already have vehicles that work.
1:06:46
What are we gaining from an electric vehicle?
1:06:52
We're not going to harm the environment. We're not pricing that.
1:06:52
Nobody's pricing the end of the world.
1:06:55
Nobody even thinks that's going to happen in terms of their day to day activities.
1:06:57
Nobody's like in dire fear of what climate change means, even though it does mean something very significant long term.
1:07:03
We all think we're going to probably not even be here when it happens and we haven't priced it as a benefit to take it away.
1:07:12
The thing that it would be a harm against, we haven't priced that yet in our own lives.
1:07:16
So we're not really benefiting in the same way that we do about going to the moon, or having some cool new technology that we don't have right now.
1:07:20
So all the solutions that I can think of are like that though.
1:07:25
Like the two things that come to mind are too, they're not quite as grand, but like, how about viruses?
1:07:28
Now that we've got COVID in this situation, you need the government to take risks that the private sector can't absorb profitably.
1:07:34
The risks that are such, that the nature of taking the risk is one that where the person that takes it, can't be the one who gets the reward from it.
1:07:43
Maybe it's the case, there's a one in a trillion chance that will make a whole bunch of money.
1:07:48
And everybody who spends that amount of money, the next guy will do even better.
1:07:52
The next person will give even more.
1:07:52
If you have a situation like that, the private sector cannot solve that effectively because nobody's going to be the one that just forgoes their capital and contributes to the next guy.
1:08:00
But the government can be the one that does that.
1:08:04
So there's an example of this, actually in the area of energy, in the area of nuclear power, it's hard to build a power plant.
1:08:08
But when you build a power plant, a nuclear power plant with new technology, you learn about what worked and what didn't.
1:08:17
And the next person who comes along to do that is now in a much better situation.
1:08:21
Like dramatically better.
1:08:21
Especially in a world where you haven't built a power plant in 50 years.
1:08:25
And you're dealing with totally new designs and new technologies, right?
1:08:25
So I definitely see a role for the government in those areas.
1:08:29
The problem is in terms of mobilizing people in the way that you might have mobilized and excited them around space travel, it's very hard, cause I can't think of any problems that are in need of a government intervention like that, that the market can't already solve and produce.
1:08:44
It's hard for me to get in front of us to that point and think, "Okay, there's this really cool thing that nobody knows about, that would be available if only the government were to step in right now and kind of provide that initial boost." I don't know what it is. It's by design.
1:08:58
Jim O'Shaughnessy: Well, maybe, and then, I immediately went to the little mini documentary about Bill Gates and here he is.
1:09:07
He's trying to solve all this stuff, dysentery and changing refuse into drinkable water, and it seems to me that those would be like pretty great US government initiatives. Jesse Livermore: Yeah. Yep. Jim O'Shaughnessy: Okay.
1:09:22
See, so guys this is hard.
1:09:22
It's really hard, especially if you understand in the David Deutsch sense of you can't predict, what you don't know will happen.
1:09:29
And when there is no error correction and innovation, things die on the bind, and unfortunately for the most part, public-private integration has worked in the past.
1:09:43
I mentioned DARPA and the internet and lots of these massive innovations that we are enjoying today, sort of started as government initiatives.
1:09:51
I'm not trying to say that there is not a place for them.
1:09:57
It's just really hard these days, because the private sector has gotten so switched on about this stuff to figure that out.
1:10:03
But who knows five years from now, there might be some massive problem that ignites everyone's desire to figure it out, and then something like this happens.
1:10:16
I guess, we could talk about this all day, Jesse, but you know we started with currency, maybe I'm going to ask you to just sort of prophesize and you can be very imaginative here because most prophecies are wrong and the value of them, I think, well, it's like reading science fiction, right?
1:10:36
So I love science fiction because as my friend, Josh Wolf says, "Science fiction often becomes science fact."
1:10:41
And these speculations that people would scoff at, when they were written originally, I think of the Foundation and the Dune, and a lot of stuff that they're making movies of right now are, generated a lot of things.
1:10:58
So speculate for me, Jesse.
1:10:58
You and I 10 years from now, so it's 2031 and you bump into me after my mRNA, youthful boosts I got in Switzerland.
1:11:05
Maybe that's another reason they had made over there.
1:11:14
And we're just chilling. What are we doing?
1:11:14
What are we talking about?
1:11:19
What do you think 10 years from now.
1:11:19
That doesn't seem like a long time.
1:11:22
Jesse Livermore: I'll say this, and this is just me being as honest as I can be.
1:11:24
I mean, and I don't want to think this, but I tend to lean in this direction.
1:11:28
I don't know that you guys are going to agree with me, but I tend to be a little bit more along the lines of a stagnation.
1:11:32
Let me give an explanation for why.
1:11:32
10 years ago on Twitter, we were talking about electric self-driving cars, and it was almost like an absolute certainty that within five years, the entire thing was going to be like, self.
1:11:43
Because it's just such a simple problem.
1:11:48
It just seems so obvious, right?
1:11:48
And then we get into the real thing and we find out, "Whoa, this has got a lot of issues to bring to public use, and are we even 10 years away now?" I don't even know.
1:11:58
I mean, I wouldn't be surprised if we don't have self-driving cars in 10 years.
1:12:01
The realist in me wants to hold back the excitement and the enthusiasm for how different the world's going to be in 10 years, because from what I've seen, I hate to say this, it seems like growth is slowing a little bit in each generation.
1:12:12
It's getting harder and harder to pull down these low hanging fruits, and I just think, I'll say this, more of our energy financially will probably be spent on healthcare and education, because those are the two areas where the greatest needs exist, right?
1:12:27
Think about it in terms of just solving problems that could make the world a better place. Healthcare and energy.
1:12:31
You can go on a tech and make some gadget that like helps people get hooked on going online or making money off that.
1:12:39
But if you really wanted to make the world better place, you cure cancer.
1:12:39
You cure all the horrible diseases that are out there.
1:12:44
You teach people to create an educational structure that allows for people to really become better people and make for better societies in real, tangible ways, like more intelligent, better climatized, better social relationships, all that stuff at the youngest age of children.
1:12:58
But the problem that I see is that those are the hardest areas to innovate in.
1:13:04
The fight that you're having with nature in those areas is the hardest fight.
1:13:04
There's not as many hacks in those areas that really work, like there are in other areas, especially in tech that we found, that we've discovered.
1:13:14
And so what I would probably say is that I think things are going to be less different than we think they will be.
1:13:19
They're going to be more like they are now.
1:13:22
Relative to our expectations, which are probably going to be overly optimistic.
1:13:26
And then I would say that, if there's going to be a game changer, it's going to be in healthcare.
1:13:31
And it's going to involve probably something like what we're seeing with either mRNA technology or with CRISPR, right? Something there.
1:13:37
If there's going to be a game changer, I'm not predicting it, but if you come back from the future and tell me, "Hey, there was a game changer, Jesse.
1:13:45
Now go guess what it was.
1:13:45
I would guess it's going to be in those areas."
1:13:49
Jim O'Shaughnessy: And by the way, we could have made this entire show about the future of healthcare, because I completely agree with you.
1:13:56
I am wildly bullish on the next 10 to 20 years in things like mRNA, CRISPR.
1:14:05
I think there's going to be a lot there.
1:14:05
Obviously there's could also be lots of problems.
1:14:05
Ray Kurzweil wrote, a transhumanist and he's at Google now, and he wrote a book, I think in the nineties, basically saying that we are all going to be immortal by now.
1:14:17
So he kind of overstepped there.
1:14:24
I mean again, that's okay.
1:14:24
Because, then you've got to, you've got to ignite people's imaginations and everything else so, I agree completely on the healthcare front and CRISPR, and hopefully a lot of great stuff for the emerging countries of the world.
1:14:39
So if we can cure dysentery, that's millions of lives.
1:14:46
And you know, I think human ingenuity is the ultimate resource, and being able to stop those deaths, just a magnificent thing.
1:14:57
Jamie, what do you think?
1:14:57
You'll only be, "Let's see."
1:14:57
God, how old will you be in 10 years, Jamie? Jamie: I will be 35.
1:15:06
Jim O'Shaughnessy: Do you think that they will see a lot of this kind of like massive exponential change in society and in the cool things that they can do?
1:15:15
Jesse Livermore: I do, but it comes with a little bit of bad news, and I think that the bad news is that I think it's not going to be change, it's going to affect us as much as it's going to be change, it's going to affect people that don't yet exist.
1:15:24
People that aren't yet here.
1:15:24
So with respect to, for example, gene editing, I think that the hack that we're going to find is going to be a hack that gets at things at the earliest stages when they go wrong and that fortifies, the embryo let's say, or that takes out the disease way before it's even in the system.
1:15:39
Right now where we are, the realist in me, even though I want it to be differently, the realist in me thinks that it's going to be hard because the entropy of the human body is so enormous.
1:15:49
There's all the things you have to fight to stop a process from going the way it normally goes.
1:15:53
But if you can get at the process when you create the new thing, you create it in a new way.
1:15:58
If I had to bet, that's where I would expect to see real revolutionary change in the thing that matters most to us all, which is like longevity, wellbeing, all that stuff, right? Jim O'Shaughnessy: Yeah.
1:16:11
So basically Jamie's kids, Jesse Livermore: Jamie's kids.
1:16:14
And that's not a fun answer because we want it to be for us.
1:16:14
But I think if I'm a realist, that's where I think the potential lies and there's like the immoralist crowd that thinks that will be immortal.
1:16:22
I don't think that's ever going to come, but if we're going to move in that direction, I think it's going to be happening to things that are not yet formed.
1:16:30
It's going to be things that are like embryos that don't yet exist, that have not yet become human beings like us, right?
1:16:34
They are human beings, but they have not yet become fully grown human beings, those are the ones that are going to be the ones where you see the most revolutionary change, because there you can get at the process before it's even started before all the wiring is in.
1:16:42
Because the wiring, it's all put together, if you can get to it early, that's where I think you would probably see it.
1:16:47
Like people living to the age of 500, for example.
1:16:51
Jim O'Shaughnessy: [inaudible] a lot. Jesse Livermore: Yeah.
1:16:53
Jim O'Shaughnessy: So Jesse, we could go on and on and on.
1:16:57
I love your practical approach.
1:16:57
I tend to be given the flights of fancy and think about how cool everything is.
1:17:03
And I love the fact that you are very realistic.
1:17:03
And as much as we would like, certainly someone like me to be able to get a CRISPR, to reset some of my bad genes, that probably won't happen, but it might for the onboard generation, which I think is cool.
1:17:23
So as you know, we end each one of these podcasts, and now you're going to be just incepting people all over the place [Matt] , because you already had to.
1:17:29
If you recall, we're going to give you the powers of the emperor of the world, but you can't kill anyone.
1:17:34
You can't incarcerate anyone, but you can incept people, if you remember the movie Inception.
1:17:41
So you can give two ideas or new thoughts, when people wake up tomorrow, they'll think that they had that idea themselves.
1:17:54
What you got for me Jesse? Jesse Livermore: Wow. Okay.
1:17:55
So I can't say what I said last time then, right? Obviously.
1:17:56
Jim O'Shaughnessy: Nope, Nope.
1:17:56
Jesse Livermore: In this case I would probably, I think that there's a quirk in the way that the human being is designed, that when you envision yourself in the shoes of somebody else, it triggers a certain sensitivity to that entity's interest that wouldn't otherwise have been triggered, right?
1:18:08
So if I had the ability to play an exercise, a mental exercise game with anyone in the world, it would be something around that kind of empathy.
1:18:15
Like if we just empathize more, the entire world is going to be a better place.
1:18:19
Now there are risks to empathy, and there's authors that have written about the risks, but I just think that when we think about every person as someone that I might be, and we think about what the world would be like from that person's perspective, the simple act of doing that, makes us better people in terms of where our sensitivities are...
1:18:37
Jim O'Shaughnessy: I love that.
1:18:37
Jesse Livermore: where our emotions are, where our day to day operations are.
1:18:39
And whenever we have conflicts, I think it's always helpful to try to imagine that perspective, not because the perspective of the person is necessarily valid, they could be in the wrong, but just the act of stepping inside that person's perspective makes it important to us, makes that person's wellbeing important to us, makes that person's subjective outcome important to us.
1:18:57
Whereas otherwise it's invisible sometimes, and that's unless they trigger something in us that makes us care.
1:19:01
That would be what I would say.
1:19:04
Jim O'Shaughnessy: I love it. Jesse Livermore: Okay. Jim O'Shaughnessy: Yeah.
1:19:05
But you got to give me one more. That was one.
1:19:06
Jesse Livermore: Well, see honestly right now, what comes to mind is this.
1:19:08
It's somewhat related to that, but it's more practical and it has to do with the fact that we tend to over privilege, when we develop assessments of the way the world works and when we try to measure risk, we put too much weight on what we've seen and not in a enough weight on data.
1:19:28
And the reason I think this is an important, I don't want to get political here, but I tend to be a little bit of a COVID Hawk in the sense that, on the spectrum, I tend to try to not want to get COVID more than the average person.
1:19:41
And there's a big debate right now in our world about COVID because if you're somebody that COVID has such a high variance of impacts, that's what makes it so difficult publicly to deal with is that it's got such a high variance.
1:19:50
One person gets COVID and it sniffles, another person gets COVID and then they're dead at the age of 40, and no one knows why.
1:19:58
And that scenario, that reality, makes it hard to build consensus around measures to try to stop COVID, stuff like vaccination.
1:20:04
And so if I could somehow get people to not use their own end of one data, to assess the risk of something and to choose data from the entire society, to assess the risks of something and the importance of trying to stop it, I think that would help us a lot with COVID.
1:20:21
Because I think we have a solution right now with the vaccine and the difficulty of getting people to take it is that in their experience, maybe they had somebody, a relative that got it, or they got it themselves, and it wasn't that big of a deal, and they don't want to go in and take some weird new speculative vaccine to avoid getting the sniffles.
1:20:41
But they have to understand that this is not just a sniffles for everybody, sniffles' for you.
1:20:45
And one, is not an appropriate end of one to use for assessing the public risk. So that's...
1:20:51
Jim O'Shaughnessy: And I always beg people, "Please look at a bigger sample size, please."
1:20:54
And it's like the narrative thing.
1:20:54
I say for the most part that narrative follows price, not the other way around.
1:21:02
And that's my little hobby horse, but another one is you just really picked it for me.
1:21:06
I mean, we have these huge sample sizes, look at the results of those.
1:21:14
Don't look at the results of your cousin, Vinnie, who got COVID and was back at the beach two days later, because you're absolutely right about the variance.
1:21:25
And variability, it'll kill you in investing often, and it will kill you if you don't take it seriously in terms of the public health.
1:21:32
Well, this is as always been a tremendous treat for me.
1:21:38
You can follow Jesse on Twitter and he is got a blog.
1:21:38
Give us the blog again, we'll put it in the show notes.
1:21:44
Jesse Livermore: philosophicaleconomics.
1:21:45
com, but I also have a lot of writing up on, OSAM. Jim O'Shaughnessy: Yeah.
1:21:48
Well, you're an OSAM research partner, the first.
1:21:51
So we very much appreciate your brilliant work and want to see and hope to see more. All right.
1:21:58
My friend, great to see you.
1:21:58
Jesse Livermore: I'm not going to say what it is, but we got some big stuff that we're working on right now. Just...
1:22:02
Jim O'Shaughnessy: I love it. We're teased. All right.
1:22:05
Jesse Livermore: Take care, guys.
1:22:06
That, that, that was a huge blast. Thanks again.