Matthew Lekushoff |


John Maynard Keynes once famously said, "The market can stay irrational longer than you can stay solvent." 

Although this remark was made in reference to nonsensically undervalued valuations, his point - at least in regards to the market's ability to remain divorced from reality - is still relevant today.  In other words, the markets seem very irrational these days, but optimistically so.  

Yes, there are some positives to note. Economies are re-opening and every day brings us closer (let's hope) to the discovery of a vaccine. It's also fair to say that most governments and central banks have done a good job helping stimulate economies and lubricating financial markets. The result has been better GDP numbers (though not good) than initially feared. 

Yet, this is where my optimism begins to wane. The other side of the ledger tells a different story. Daily global COVID-19 infections recently hit a new high, governments are amassing incomprehensible amounts of debt, and the true economic output is practically unknowable due to unprecedented levels of government spending and central banks printing funds. 

I'm not saying it's all doom and gloom. However, given the above, the U.S. stock market, in my opinion, shouldn't be only seven per cent lower, year-to-date. Unless some of the aforementioned trends reverse, or at least stabilize, I'd expect markets to consider them more carefully and fall somewhat in the coming months. In terms of our portfolios, not only have we performed well, we are well-positioned for anything the markets send our way. We also have ample resources to both weather a financial storm, and utilize bonds and gold (our defensive positions) in order to take advantage of the situation. 

For additional perspectives, Howard Marks' recent note, The Anatomy of a Rally, is an excellent summary of market actions, and David Rosenberg's Don't Fight the Fed? provides a detailed examination of the financial manipulations (programs) governments and central banks have undertaken.

Another eclectic month of reading comic books and graphic novels, the history of finance, a classic story about the aftermath of the bomb that destroyed Hiroshima, and much more. 

I also returned to podcasts (while doing chores and working out, as opposed to on my commute) and binge-watched the Toy Story series (spoiler alert: I loved it).
Understanding Comics: The Invisible Art by Scott McCloud: Great introductory book (written in comic book form) into comics and graphic novels. Understanding Comics helped me appreciate some of the nuances of the genre that I've been missing.
The Navigator of New York by Wayne Johnston: The Navigator of New York paints a vivid picture of New York City and polar expeditions at the turn of the 19th century. While I'm glad I read it, the first half required some perseverance. The second half, however, picked up and made it worthwhile.


Hiroshima by John Hersey:  A classic New Yorker long-form article written in 1946 that explores the harrowing aftermath of Hiroshima after the atomic bomb. Although graphic in detail, it is an important reminder of the devastation modern weapons can unleash on humanity.

The Absolute Sandman, (Volume 2 - Issues 21 - 39) by Neil Gaiman: As I continue the Sandman series, I'm impressed, perhaps even awed, by the sheer number of stories, myths, and historical figures it draws upon. I'm beginning to understand why Sandman is often thought to be in a league of its own within the graphic novel genre. My thoughts on Volume 1 of the series can be found here

The Changing World Order (Chapter 3) by Ray Dalio: The third chapter of Ray Dalio's upcoming book discusses the rise and decline of the Dutch, British, and American Empires. It mostly focuses on economics, with a particular emphasis on currencies. My takeaway was that empires usually have the added benefit of controlling the world's reserve currency, which allows them to dominate international trade. However, when an empire's power and influence declines, their currency generally does as well, and often with economic consequences. Given the U.S.'s current relative decline, this chapter was of particular interest. Should history repeat itself, as it often does, it's reasonable to expect the U.S. dollar to lose its reserve status as well. The questions that then arise are, when will that occur and how will it affect global markets? 


The Playing Field by Graham Duncan: Life can be seen as an elaborate game - perhaps even as a number of games within the larger game. With that in mind, this article makes two important points: it encourages the reader to stop and consider what game they are playing (and whether it's the one they want to play), and it discusses the levels of expertise one can reach while playing any particular game.
Best Route to Wealth: Savings or Earnings, a Debate by Barry Ritholtz: Interesting conversation about spending and frugality in the COVID era.

Yes, Financial Literacy Programs Do Work by Anthony Isola: I've been passionate about financial literacy for some time. It's nice to see that considerable research exists to validate its positive affect.

The Thinker's Thinker by Anthony Gottlieb: Worthwhile essay on the short life of philosopher, economist, and mathematician, Frank Ramsey.
A Faint Flicker of Hope in Europe by Peter Zehan: Peter Zehan rarely has a positive thing to say about Europe and its future. Although far from glowing, this blog post discusses the one aspect about the continent that gives him a degree of hope.

Shubham in Volgograd by Patrick Fearon-Hernandez: Interesting commentary on Russian history and how it relates to the current Putin regime. Worth reading just to learn about Rodina Mat' Zovyot, a statue that makes Lady Liberty seem small.

The Idea Trap by Bryan Caplan: Thought-provoking article on how developing countries would be wise to implement the policies of wealthy countries. I agree with much of the article's notion that success leaves clues to be followed. However, I think Caplan misses an important point: As explained in Joe Studwell's great book, How Asia Works, developing countries are often better off walking before they run. Many countries have been hurt implementing an open free-trade structure before they were ready.

What You Can't Say by Paul Graham: From 16 years ago, yet many of the topics are just as relevant today.

Why Fiction Beats Facts by Tom Morgan: In order to mobilize large groups, societies have always been founded on stories and myths. As the author puts it, "Thus believing in a common fiction that forms a solid social group has been evolutionarily much more important than any objective truth or reality." 

When I first came across this theme in Yuval Noah Harari's Sapiens, I was skeptical. However, the more I've learned and observed, the more I'm convinced there is something to this argument.


Josh Wolfe - The Mind Financing The Future by The Portal: Wide-ranging conversation between two brilliant people: Josh Wolfe and The Portal's Eric Weinstein.

Major Landslide Destroys 8 Homes In Northern Norway: Incredible! I've never seen anything like this.

Toy Story 12, 3, & 4: Having recently signed up for Disney+, Tanya and I binged the Toy Story movies. Great movies and we enjoyed watching the evolution of animation technology over the series' 24-year span. Makes one wonder what movies will look like in a decade or two.


"In life the challenge is not so much to figure out how best to play the game; the challenge is to figure out what game you're playing." 
- Kwame Anthony Appiah
"There are decades where nothing happens; and there are weeks where decades happen." 
- Vladimir Lenin
"Sometimes the best way to learn something is by doing it wrong and looking at what you did." 
- Neil Gaiman
"He laughed, and said, "Consider, Sir, how insignificant this will appear a twelvemonth hence." - Were this consideration to be applied to most of the little vexatious incidents of life, by which our quiet is too often disturbed, it would prevent many painful sensations."
- James Boswell, The Life of Samuel Johnson

Matthew Lekushoff

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