Weekend Reading – May 13, 2018

1. Lauren Oyler writes a skeptical essay for the NYTimes Magazine exploring the concept of “necessary” art, as the proliferation of art that critiques and comments on our current social, economic, and cultural state of affairs, and the cacophonous commentary that often accompanies it on the internet.

The proliferation of the adjective “necessary” has created what she calls “an absurd and endless syllabus, constantly updating to remind you of ways you might flunk as a moral being.”

In my view, her criticism is completely valid and much needed – in the age of diminishing attention span and an explosion of works across all artistic mediums, I think there’s an increased weight to consume from the neverending hamster wheel of content in a drive to expand your personal politics, sense of morality, and view of the world, in the place of consideration, exploration, and reflection.

2. The NYTimes Magazine has devoted a significant amount of its recent features to the current opioid crisis in America — profiling the pharmaceutical companies that produce the most infamous drugs, the police, social workers, counselors and treatment centers that seek to manage the crisis, and in this week’s edition, pregnant mothers in various stages of opioid addiction.

The article touches on the ethically and scientifically gray areas around these mothers and their children – including child abuse prosecution for addicted mothers in 24 US States, the use of methadone, antidepressants, and other drugs to stem the effects of opioids on the pregnant mothers, tackling the early withdrawal symptoms of the newborns, and the to-date unknown long-term effects on the children of the addicted.

The facts are jarring: the occurrence of neonatal abstinence syndrome (NAS) in newborns has grown to eight per 1,000 hospital births from 1.5.

3. Morgan Housel writes a fascinating and intuitive piece as part of his weekly Collaborative Fund writings, entitled – If Collaboration Fund Invested In Public Stocks.

The article is an incredibly straightforward approach to investing, and a worthwhile take on the “buy and hold” edict espoused by market experts and given to market novices.

Eight years ago, a VC partner at Collaborative Fund recommended buying 100 shares of Amazon and Netflix every month for 10 years, which would have provided a 21% annual return. Depending on how you view it, this advice could either be viewed as incredibly prescient or a byproduct of a sober view of the economy, and a long-term view of the markets.

Unlike venture capital, whose hold periods can extend beyond 10 years, equities are subject to the daily, quarterly, and annual “noise” associated with their most recent results or exogenous factors (legislation, competitors, etc.) creating “interim volatility” impacting the perceived value of their share price. By filtering out this noise, filtering on committed long-term value, and committing oneself to a VC-like holding timeline, the article points out that it doesn’t take a VC pedigree or millions of dollars to benefit from outsized returns.
The article recommends 7 public equities with distinct long-run competitive advantages as companies that it believes will endure, and continue to appreciate in value over this timespan: Amazon, Berkshire Hathaway, Tesla, Square, Tencent, Adobe, and Netflix.

Regardless of whether you agree with his assessment of the companies in particular, I think the article is an incredibly worthwhile way of thinking about markets investing, and provokes ones own take on the types of companies that will result in long-run competitive advantages, innovation, and society-shifting change(s).

4. Always a sucker for productivity “hacks”, I also enjoyed Siddartha Mukerjee’s article on likely the most consequential “checklist” in a world full of them: the surgeon’s checklist.

The article explores the initial findings of fellow physician-cum-writer, Atul Gawade, who wrote a book on the surgeon’s checklist and its more “general” applications across mediums, the Checklist Manifesto, and its mixed success in different medical applications and across the world.

The article concludes that checklist or not, human behavior remains the largest factor in the successful adoption of the checklist and its ability to reduce incidence of failure.

5. I enjoyed FT columnist Simon Kuper’s take on the commencement address, which provides a humbling and level-setting appeal that’s relevant to both new grads and general readers.

If you are graduating in a vocational or technical subject, then whatever you learnt is going out of date as I speak. Nor will you learn much more if you enter the ‘real world’ of business, because business isn’t the real world.

Kuper introduces the concept of “lifelong learning,” which affirms that despite this step forward (graduation), that a continued life of education awaits, with no shortage of opportunities to learn from your fellow (wo)man, from resources both on- and offline, and from the world around you, as long as you’re open and willing to listen.

6. “Now everyone cares about Russia, and there’s no nuance.”

As Russia has again become the predominant geopolitical foe of the United States, the NYTimes Magazine profiles US foreign service officers and experts from the past 7 US Presidential administrations who’ve devoted their careers to US-Russian relations – known as “Russian hands” (protip: don’t Google “Russian hands.”)

The article somewhat hilariously shares the consensus amongst the Russian experts on the different approaches taken by US diplomats towards Russia, all fitting neatly into two buckets. However, where they don’t agree is how to bifurcate between those categories. There is the classic division between “realists” versus “internationalists,” as well as “missionaries,” who advocate for promoting democracy, freedom and liberalism through dialogue and ”crusaders” who similarly seek out freedom and democracy through influence in the region. Further, there are those who came to Russia through political science (“more cool and collected”) and those who came to it through literature (who “let their emotions get the best of them”), those who “put Russia in context, held up against the light of outside standards and consequence,” and those “who take Russia on its own terms, attractive and wonderful but subject to romanticization.” Good luck trying to draw parallels between all of these.

The article recounts the various events and approaches taken by the different administrations towards Russia, and provides some background into the current perceived Russian antipathy towards the United States, based on competing priorities and the the US domestic political situation, differing Presidential approaches towards Russia and the region, and the broader geopolitical environment of the time.

The consensus of the latest batch of Russia hands, who have steeped in the history of the Soviet Union and the broader Russian/Soviet mentality, is that US politics have seeped into our relationship with Russia, creating a “postelection political climate has made it impossible to work with Russia even on issues that would benefit both sides.”

7. A bit late, but the Boston Globe published a very worthy critique of management education and its approach towards the blue-collar workforces that MBA graduates oftentimes impact (most often through consulting and private equity, but also through straightforward corporate leadership.) The twist is that the article was written by three current MBA students – two from nearby MIT Sloan, and one from Stanford GSB.

The article is a credible look inside the institution on the lack of labor relations and related discussion on business school campuses, in favor of discussions on “values driven leadership” and the potential for future workforce automation. As MIT Sloan professor Thomas Kochan writes: “Labor relations is often either ignored or, if covered, curricula tend to focus on how to avoid rather than how to work with” workers’ rights groups, a damning view from a credible source.

As Duff MacDonald explained in his history of HBS and the broader MBA, The Golden Passport, labor relations was a major focus in the MBAs of the 1970s and prior, but as the importance of labor diminished with the rise of Wall Street and private equity buyouts, the curriculum (and more importantly, broader focus) has shifted along with the times.

The article offers some suggestions for more closely integrating and exposing future business leaders to ordinary workers, and I think is worthy of heeding. In a follow-up post in the Globe, MIT Sloan professors, including some affiliated with the notoriously worker-friendly Costco, defend Sloan by addressing the existing curriculum in place, but the broader critique, which is aimed at the MBA degree, rather than any one school, stands.

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