If keep life at safe distance, prevents you from seeing world in truly clear way
Marx – if his predictions were wrong, it may be because he never truly lived a worker’s life
After working in factories, feeling affliction firsthand, ideas grow more radical
People hide behind the abstract
While many out there are truly suffering and starving
We’re also starving in “needs of the soul”
14 of these needs
1. Order – need some order to function, just like food
2. Liberty
3. etc Many of these are in tension with each other – and need balance
Each contributes to peoples’ psychological needs
Biggest need that is sabotaged by modern society – “the need for roots”, like a plant
Any human being that is truly independent?
No, inseparable from society
People get roots from active participation in life of community
Colonialism destroys this culture and solidarity
In her time, France subjugated foreign cultures, tried to replace with French culture
This transplanting is like uprooting a plant, destroying the roots
Codified human rights won’t matter to a person like Hitler
Forced prostitution is wrong and we all agree on it – but it’s far deeper than legal rights
Preferred discussing human NEEDS rather than rights
Separating people from their own culture, roots is de-humanizing
Revolution was the new opiate of the masses – but very little comes out of it
After her factory experience, she discovered a new way to think about ethics
What makes someone sacred?
Is it their body? Their unique personality?
The way forward is a spiritual revolution
Cultivation of a new kind of attention Renounce the ego Receive the world in a more universal, impersonal way De-creating biases, assumptions, that we bring to bear
This is a spiritual transformation
Connect to human beings on a universal shared level, instead of at level of personality or physicality
Similar to Catholic sacrament of Eucharist
This new form of attention is a new lens to see the world
Become an antenna for God to communicate with
An experience to feel closer connection to the universe
Derived from things humans said, but doesn’t always know connections between the things – which can lead to it saying whacky things
Transforms everything into an “embedding space”
It’s pastiche – imitating styles, cutting and pasting, template aspect
Both brilliance and errors come from this
Humans have some internal model – of physical world, of a relationship
Understanding is also about indirect meanings
AI doesn’t have these internal representations
Sam Altman – “humans are energy flowing through a neural network”
Human neural networks have much more structure than AI neural nets
Neural nets like ChatGPT have 2 problems:
-not reliable
-not truthful
Making them bigger doesn’t solve those problems – because they don’t have models of “reliability” or “truthfulness” “They’re just auto-complete” “It’s mysticism to think otherwise”
No conception of truth – all fundamentally bullshitting
It’s a very serious problem
Can use GPT3 to make up stories about covid, spread bullshit and misinformation
No existing tech to protect us from this potential tidal wave of misinformation
People used ChatGPT to make up fake coding answers to put on StackOverflow
StackOverflow had to ban ChatGPT
“Talking about having submachine guns of misinformation”
Ezra – ChatGPT is really good at mimicking styles, but core doesn’t have truth value or embedded meaning
Silicon Valley always good at surveillance capitalism
Now you can use AI to write targeted propaganda all day long
Ezra – this AI will be good for people and companies who don’t care about truthfulness. eg, Google doesn’t care about “truth” but about clicks
One of main AI use cases is SEO copy to drive clicks and engagement
In some aspects, as models get bigger they get better (eg, at generating synonyms); but at truthfulness, wasn’t as much progress
Loves AI and have thought about it his whole life – just wants it to work better, be on better path
Biology has enormous complexity – too much for humans – AI could really help us
Also climate change
Could empower individuals like DALL-E does for artists “Reason according to human values”
Right now we have mediocre AI – risk of being net negative – polarization of society, growth of misinformation
Parable of drunk looking for keys at night around a street light The street light in AI is deep learning
Human mind does many things: pattern recognition, use analogies, plan things, interpret language
We’ve only made progress on a tiny part
We need other tools (not just deep learning)
Fight between neural nets and symbols (symbolic systems / symbolic learning)
Find ways to bridge these 2 traditions
Ezra:
Deep learning – give all this data, figure it out itself, but bad at abstraction
Symbolic systems – great at abstraction (eg, teach it multiplication from first principles), abstract procedures that are guaranteed to work
Most symbol manipulation is hard wired
Kids learn to count using generalized rules
AI hasn’t matched humans in capacity to acquire new rules – some paradigm shift needed
We’re worshipping the false god of “more data”
Believes will be genuine new innovation in next decade
Mitophagy – subset of autophagy
Autophagy is stimulated by fasting states
When body doesn’t have enough food, it hunkers down and recycles dead old parts
Can stimulate through fasting, calorie restriction
Becoming lean and conservative
Mitochondrial dysfunction – associated with many ailments
David Sinclair – Cell journal – mitochondria are unified link in everything we know about aging
Mitophagy – how to get rid of old / defective mitochondria
Most powerful signal is diet – calorie restriction, fasting
Glucose levels in brain need to be reduced
Neurons love glucose – but why is too much glucose bad?
High glucose levels may be a symptom of metabolic dysfunction, possibly mitochondrial dysfunction
Infants – breast milk is most beneficial / healthy food source
If infants have seizures – ketogenic diet can help
Even experts don’t know what causes obesity epidemic
Believes mitochondria is the answer
Maybe epigenetic factors in womb environment
Mitochondrial DNA comes exclusively from moms DNA?
“Unequivocally no”
Mitochondria encoded in 36 genes – but majority of proteins that comprise mitochondria are encoded in nuclear DNA which is inherited from both parents
Diet, drug, alcohol use (including THC), lack of sleep – all impair mitochondrial function
Alcohol disrupts how brain uses all kinds of fuel – including glucose metabolism
If alcoholics switch to ketogenic diet – less alcohol craving, better brain metabolism, reduced brain inflammation
Rats on ketogenic diet – much more responsive to alcohol (“cheap dates”)
5x higher BAC levels!
Hypothalamus – involved in motivation and craving
Brain metabolism deficits can be corrected in short term with ketone supplements (eg, liquid ketone esters / ketone salts)
Ketogenic diet isn’t just about ketones themselves – also lowering glucose levels, ramping mitochondrial biogenesis
If metabolically healthy, ketones themselves *could* have benefit
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Started 1:08 in
L-carnitine – oral only absorbs 10%
Increases androgen receptor density
Vitamin D – optimizes testosterone if deficient
Free testosterone should be ~2% of total testosterone – reference range is 1-4%
Longjack – up regulates several enzymes
Tongkat – helps synthesize testosterone; 300-1200mg/day; be careful with standardization
Andrew takes it early in day, has stimulant effect – increases free testosterone for him
No reason to cycle it
Can increase DHEA
Fadogia – increases LH (luteinizing hormone), stimulates production of sperm / testosterone
300mg / day as a safe dose or 600mg / every other day
1st trimester pregnant ladies have high HCG levels in urine
Growth hormone / IGF-1 – usually don’t need to optimize it, but sometimes in diabetics it can be dysregulated
Amino acids before bed can help with growth hormone release
Some weight training regimens can increase growth hormone
Helpful to avoid eating 2 hours before bed as general health protocol
While fasting increases growth hormone release, downstream effects are mitigated so not significant net effect
Guest: Leah Garces, president of Mercy for Animals
50 years ago, meat costs $7/lb, today chicken is $1.80/lb
“These prices are fake”
Chickens today grow much bigger, much faster, much cheaper
-Reach slaughter weight in 6 weeks time, 3x faster than before
-50K birds in one warehouse – lose any sense of individuality
-Used to be 2-5sf of space per bird, now 3/4sf per bird – wall to wall
Battery cages
-for laying hens to produce eggs
-6 to 10 birds in a barren wired cage, crowded, causes aggressive behaviors, peck each other
-solution: industry shears off beak tips to reduce damage
Fish numbers are hard to quantify because they’re reported in tons
Land animals – 80 BILLION in the world, 70 billion are chickens (90%)
America is highest meat consumer – per capita eats 27 animals per year
America produces / have access to – 225 pounds of meat per person per year Numbers are growing – last year was highest number ever produced and consumed
Chickens today grow so big so fast that they collapse under their own weight – especially their breast muscle – can’t survive past 6 weeks old, have heart attacks, too metabolically taxed
Product of selective breeding just for breast muscle
Chickens in wild can live many years
The meat has more fat and protein content than before, white stripes in the meat which are literally disease markers as result of fast growth
Chicken warehouse / factory farms
-chickens are very immobile, plopped down
-lots of sores on body
–“marshmallow on toothpicks”
-often panting, taxed by weight / size
-very fragile
What % are raised industrial – globally it’s 90%; in America it’s 99%
A positive trend: 1/3 production of eggs is cage-free now, as result of pressure campaigns
-still an industrial setting (indoors, over crowded, given antibiotics)
-just not kept in cages anymore
Gestation crates for pigs
-source of bacon, sausage
-pregnant pigs kept in metal crate so small that pregnant pig can’t turn her body, can’t really lay down; bottom of cage is cold and wet with slatted floors for feces; after giving birth, kept in a slightly larger farrowing crate, essentially a breeding machine, piglets are taken away – and the cycle starts again
-the pigs scream when their babies are taken away
70% of medically imported antibiotics in US are used in animals
-necessary for these animals to survive, grow faster
-antibiotic resistance is growing; millions of future deaths will come from antibiotic resistant diseases
-to reduce antibiotics would require changing genetics of the animals
–
Meat industry needs to internalize these external costs
-CDC tracks viruses of concern: most are things like avian flu, swine flu – spreading from birds and pigs
-zoonotic diseases (from animals -> humans)
-pigs are more closely related to us than chickens
Impact on climate change
-livestock farming – mostly cows emitting methane – 14.5% of global greenhouse gas emissions (could be underestimate, as high as 25%)
–half of world’s usable land is for agriculture, most for livestock
-1/3 of arable land is used just to raise crops to feed farm animals (eg, soy, maize)
-contributor to deforestation
-contributor to air pollution (chickens produce ammonia and dust particles to local area; pig waste is collected in a cesspool which is sprayed into the air / fields, usually in low-income areas)
eg, Eastern North Carolina – former slaves area, hog industry moved nearby, hog waste ends up on clothes, cars, houses, but don’t have power to fight back, “nobody’s gonna put this in San Francisco”
–Gulf of Mexico dead zone – fertilizer run off into Mississippi, then into Gulf of Mexico – a zone the size of Rhode Island where no sea life can exist, only some species near the surface – the bottom has no oxygen nor life
100x more land used to produce a calorie of meat than a calorie of vegetable
Why isn’t meat more expensive? What are the externalities?
-animal suffering
-climate change
-air pollution
-farmers – owe lots of debt, often in low income areas
for chickens, farmers collectively owe $5B+ in debt, held hostage by it
a chicken farmer is basically a babysitter
keeps chickens alive for 6 weeks, then company collects and pays them
a form of indentured servitude
What about tax payer / government subsidies?
-in 2011, government purchased $40M of extra chicken supply – tax dollars paying for over production
-during covid, gave $270M in pandemic assistance
–spent $40M for “de-population” of chickens and pigs – slaughtered right on farm, “ventilation shutdown”, gets too hot and the animals suffocate
-why does government / taxpayer dollars pay? The industry should pay
2011 – Prop 12 – banned production and sale of extreme close confinement of animals raised for meat – almost 70% of Californians voted in favor
Industry appealed, Supreme Court hearing the case, Biden supports industry / overturning Prop 12
Compassion is an infinite muscle – we can have direct impact on improving farm animals’ lives
What are some modest steps for improvement?
-internalizing industry costs thru regulation – pollution tax, improving factory conditions
-meat prices will rise, consumption will decline
3 recommended books from Leah
-Wastelands by Addison – Smithfield’s case in North Carolina
-Meatonomics
-Animal Machines – Ruth Harrison – catalyst for “Five Freedoms” for animal welfare
Cullen Roche – CIO of Discipline Funds
-Merrill Lynch asset management
-2008 financial crisis transformed his view of world – how macro can dominate everything, while micro doesn’t really matter
–Japan had been going through a similar transformation for 20 years – learned a lot from it
-Japan’s financial system modeled after Fed, US – Japan’s lessons taught him that what would happen would be the opposite of MSM narrative
-Beat the drum that post GFC would be sluggish dis-inflation
-At Discipline – hyper focused on financial planning as foundation for portfolio (more bottoms-up); “more Vanguard than Cathy Woods”
Doesn’t believe now will be like 70s style stagflation, more like 2008
Structural trends – globalization, technology, demographics – all long-term disinflationary anchors
Big lesson of Covid – fiscal policy can cause big inflation, it’s the Treasury not Fed that has the bazooka
Cyclical trends – short term inflation bump due to that fiscal policy; will come down if government doesn’t splurge
Debt cycle not consistent with high inflation environment
High inflation can only come from private sector (consumer / corporate borrowing), or public sector (government spending)
Low likelihood of big fiscal spending
In 3-4 years, we’ll realize inflation was transitory
Fed outlook
-they’ve been more aggressive than he expected
-“Fed’s kinda screwed” – look bad coming off 2021 inflation
-should have moved earlier in 2021 – eg, a modified Taylor rule
-too much focus on lagging indicators – eg, employment
–Fed is old school monetarists / Keynesians – don’t wanna live thru 1970s again
He believes today looks more like 2008, not 1970s
Big worry of real housing market downturn
Monetary policy will function through housing market and mortgage rates
As rates > 5%, “something’s gotta give” – not enough housing demand at that level
Last 10 years was one cycle, a blowoff / FOMO effect
Economy now digesting this excess, the bust component
Housing is slow moving animal
Concerned Fed will create more downside than we expect
If in 2023, inflation ticks steadily lower, housing falls fast, unemployment rises faster than expected – Fed will walk a lot back, have a mini 2008
Could be 2008 credit style disinflation rather than runaway inflation of 70s
Nik: hyper focused on housing sector, outsized impact on US economy, 3 months of home price declines
10% decline in home prices is like a flesh wound – only takes us back to middle 2021
If home prices are volatile, balance sheets become volatile Housing has become an important economic asset – more than previous generations
We don’t understand knock on effects – like 2008
Outlier risk of housing prices falling 25%, risks lurking in shadows
“2008 humbled me a lot” – thought he had a bullet proof macro framework
More analysts now forecasting larger price drops in housing – more expected volatility in 2023, 2024
Argument that covid boom was sorta fake – driven by government spending
If housing falls 25%, causes a lot more collateral damage than anyone expects
Nik: in 2007-2008, analysts argued we’ve never seen national housing price declines YoY, only regional declines – surprised everyone
This isn’t like 1987 crash – it’s not a single event
It’s a structural event – because housing is long drawn-out process, and so core to US economy
Construction still in boom period – lots of supply coming online, but don’t have demand or new construction
We’re probably in 4th inning of housing market downturn – still relatively early
Fed sorta oblivious to it, they don’t realize damage that 6-7% mortgage rates do to housing market
No idea what stocks will do in next 6-12 months
His duration framework for investment assets:
-Cash / Treasuries are Zero duration
-Bonds are 5 year duration instruments
-Stock market is 18 year instrument
–Bitcoin is 100 year duration instrument (gold is 40 year)
Stock market riskier today – valuations high, less attractive relative to other instruments, still high levels of irrational exuberance
Multiples need to come in / move sideways for longer period High multiples —> Lower risk adjusted returns
Do you want stocks at 30 P/E with high volatility or 4.5% treasury bill with no volatility? Stocks in 18-24 months – would be shocked if up significantly
Scenario: housing prices slowly grind down 10-20%, no real credit event —> would have stagnant stock market, and maybe 2025 it takes off
Risk is a real credit event – more like 2008 than 1970s – if Fed reverses, would be because real deterioration in balance sheets and economic environment
Fed will likely slowly walk rates back, ease off language, but rates will remain high and cause demand destruction – maybe late 2023 – likely to be behind curve again
At that point, credit has deteriorated, stock markets fallen 40%
Lots of starts and stops until then Higher probability of hard landing outcome than Fed finding a soft landing
Bitcoin is a technology – more like VC than equity
Public markets are boring 18 year instruments, companies are more stable boring value
VC is much younger, standard deviations larger, thus much longer duration Bitcoin is weird blend of digital gold + VC + payment system
Bet is it becomes alternative payment system – will take very long time to come to fruition
Will work in parallel with traditional fiat / credit system
Takes time for people to adopt the new mindset
He works with people who have already made good money, closer to retirement, more conservative
Results in shorter duration instruments (eg, Treasuries, equities)
Bitcoin, like VC, has too much potential downside for them For a true efficient market theorist – maybe 0.5-1% bitcoin allocation (eg, if you put 1% in bitcoin in 2015, could be 20% of portfolio today)
Big advocate of re-balancing in counter-cyclical manner to reduce skew – reduce outsized risk in any single instrument
Don’t want golden handcuffs that you can’t sell, too much capital gains, help control your behavior, don’t wanna become a forced seller
Loved Nik’s book Layered Money and its hierarchical thinking approach