“Read fewer forecasts and more history”

Back in Issue #58 of The Nightcrawler, I linked to Kevin Kelly’s “103 Bits of Advice I Wish I Had Known,” which laid out dozens of timeless insights into life, business, and everything in between. A few readers reached out to say how much they enjoyed the link, so I wanted to share Morgan Housel’s “A Few Beliefs,” which likewise offers dozens of pithy and insightful ideas on business, time management, leadership, investing, and much more. 

“Most people can afford to not be a great investor but they can’t afford to be a bad one… Beliefs that haven’t changed in 20 years are as suspect as beliefs that changed overnight… Progress happens too slowly to notice, setbacks happen too fast to ignore… We are extrapolating machines in a world where nothing too good or too bad lasts indefinitely… Optimism and pessimism always overshoot because the only way to know the boundaries of either is to go a little bit past them… The world is governed by probability, but people think in black and white, right or wrong – did it happen or did it not? – because it’s easier… It’s hard to empathize with other people’s beliefs if they’ve experienced parts of the world you have not… The cure to overconfidence is constantly reminding yourself that you’ve experienced maybe 0.00001% of the world.”


The “industrialized production of joy” at Disney

A signature trait of any great business (and investment) is a company that tends to obsess over the customer value proposition. In that sense, there’s probably no greater case study of a focus on customer obsession than Disneyland, a place Tyler Goss calls “a machine for the industrialized production of joy.” Goss, an architect who helped design elements of the theme park, gave a fantastic interview to Brian Potter of Construction Physics where he discusses, among many subjects, how Disney recruits some of the world’s top designers and engineers to create its patented “magical” experiences. 

“If you think about it, a themed attraction is an incredibly complex piece of machinery that has to take people from one place to another, tell them a story, and do it without crushing them or having them fall off the ride vehicle or what have you. And you have to deliver the same experience to 35,000 people in a day. It’s a machine for the industrialized production of joy, which is why I went there. Right? Like you can’t argue with joy as a goal. You could argue with Disney’s politics and you know, historical contribution to conservative thought in this country. But at the end of the day, it was really awesome to be able to go to the parks and see kids enjoying the things that I helped build.”


The link between cloud computing and American railroads

Byrne Hobart makes a clever connection between two thoroughly distinct business models in his latest essay: AWS for Industry, But Better: The Railroad Investment Case. “The economic model for railroads is not too far off that of big tech,” Byrne writes. “There’s a fixed asset that leads to a hard-to-match competitive advantage, and variance in outcomes is driven by how well companies exploit that asset… It might sound like a stretch to say that someone who likes investing in software businesses would also want to invest in a heavily unionized, smoke-emitting industry, but it’s true.” (H/T John Huber)

“Because of their cost advantage in intra-US transportation, and because of monopolistic economics that are politically and technologically infeasible for anyone else to duplicate, the railroad industry represents a sort of royalty on the growth rate of domestic manufacturing (and, to a lesser extent, consumption of bulky products like cars, lumber for houses, grain for food, oil, etc.). A bit like the economic role cloud computing plays in the growth of software, or ads in consumption, higher spending on the end product leads to higher spending and better margins on the hard-to-replace intermediate.”

A few more links I enjoyed: 

“Events being unprecedented does not make them beyond comprehension. The loss of continuity does not mean a descent into blind chaos. We can learn to thrive amidst discontinuity, disruption, upheaval. There are thousands of people teaching themselves how, right now. Their success or failure may be the most important challenge facing humanity.”
“The problem with customer obsession is that optimizing for delivering value to customers can cause a company to make structural choices that are detrimental to the company’s long term operational efficiency. A company that is inefficient becomes painful to work for; when a company becomes painful to work for, the best people leave – and when the best people leave, a company becomes disadvantaged in its pursuit of delivering value to customers. Paradoxically, customer obsession as a company’s paramount operating principle can lead to a declining experience for the customer over time.”

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