May 2023 - Self Awareness, Self Driving & Self Infliction:
This month, we dive into self-improvement, the US debt ceiling, the rapidly changing world of AI and the comparably slow development of self-driving cars.
The Double Nudge: A relatable guide to personal growth
The words in this newsletter are entirely our own, but the insights and ideas have been inspired by others. Our goal is to synthesise the best information we have consumed each month and relate it to our everyday lives.
This is our attempt to get better each day, and we would love for you to join us.
Quote of the Month: “You'll stop caring what people think about you when you realise how seldom they do.” - David Foster Wallace
Our Challenge of the Month - Self Analysis & Improvement:
This section might seem counterintuitive to the quote this month. However, It’s quite the opposite. I think the pursuit of performance is noble and healthy when done for the right reasons.
For myself, the right reason is not to impress others, but to follow my own ‘happiness of pursuit’ which is a motto I try to live by. Self-analysis falls within that well as there is no finish line when it comes to your personal and professional improvement.
This month, as I delivered and received performance reviews at Bounce, I’ve been thinking a lot about how one can consistently make step changes in performance by taking on feedback from those you trust and by conducting self-analysis.
Why is it important? Self-awareness is a superpower. By understanding your flaws, you can implement small changes in your habits and behaviours that compound over time.
When done well, and consistently, it improves decision-making and communication by limiting assumptions and biases. It also helps build empathy and authenticity within your own judgement.
At Bounce, I have rarely been shocked by a performance review I have received. I seek to identify my own flaws first, understand where they come from and seek advice on how I can go about change.
How can you do it well? The first step is understanding where you need to improve. If you struggle to identify this yourself, seek authentic feedback from people you trust with the goal of wanting to be better.
At Bounce, the person I seek this from is Rónán. He will deliver direct feedback in a way that never seeks to massage my ego. The reason this works is because I trust him entirely, in his judgement and his intentions. He wants the best for me, and the business, and pushes me to get there.
How can you implement change? I find this the most difficult part of the process, and frequently fail. This is primarily due to not following the below advice:
Ensure you are doing this for the right reasons, and actually want to change in the area outlined (intrinsic motivation).
Be selective in what you want to improve on. Narrow your focus and be decisive in where you want to see change (clear goals)
Find someone you trust who can nudge you in the right direction, and help reinforce behaviours that will lead to the change (accountability).
Identify when and how you’re going to be measured, through self-analysis and external performance review (measurement).
Changing habits and behaviours is difficult, and seeking improvement is a noble pursuit. You’re going to stumble and fall, but keep reminding yourself as to why you’re doing it (self-compassion)
Our Trend of the Month - Debt Ceiling:
The debt ceiling is the limit to the amount the US treasury can borrow. Much like your credit card allowance, once the limit is hit, you can no longer borrow. To correct this, you would need to take out a new card or ask your provider to increase the amount you can borrow.
But instead of Visa or Amex, the limit is set by the US Congress. As such, each time the ceiling is approaching, political jockeying ensues. Now, as that time rolls around again, the democrats have two options.
A) Reach the limit without raising and default on the debt.
B) Cut spending and upset campaign donors.
With short-term political cycles, few elective officials have the capacity or incentive to think longer-term. Irrespective of political leaning, this typically leads to the debt ceiling being increased.
Source: BBC
However, in recent times, the size of the increases is most worrisome. Irresponsible and reckless government spending in recent times has outgoings far exceeding taxation. Such a mindset has led to US national debt swelling from $5.7Bn in 1917 to $31Tn today, a 5,000-fold increase.
Source: Lyn Alden
Given the last three recessions have raised the budget deficit by 6%, 8% and 12% of GDP, another $1Tn - $2Tn deficit is imminent. Put simply, more debt means higher interest rates, leading to higher deficits and more debt - a perpetual loop, as detailed below.
Source: Guilbert Gates, New York Times
As the brilliant James Lavish points out, the US currently runs with $400Bn in interest payments annually and an interest coverage ratio of 0.75x. Yet, things are set to get worse as the debt pile continues to swell.
Source: Congressional Budget Office
In the end, I suspect it is likely a higher ceiling is pushed through, debt increases even more and ultimately some form of Yield Curve Control (YCC) comes down the line.
Irresponsible fiscal policy must be addressed and sooner than one might think. With debts mounting and interest payments taking up an ever-increasing proportion of spending, our “future problems” are right around the corner.
On a brighter note, paradigm-shifting innovation such as AI may catalyse the economic growth needed to sufficiently reduce the debt pile.
Start-Up / Founder of the Month - OpenAI by Sam Altman:
I have purposely avoided the advancements in artificial intelligence in recent months as it’s difficult to wrap my head around its potential impact on the world. However, what Sam Altman and OpenAI have achieved since 2015 is simply too hard to ignore.
To the despair of the crypto-philes, the Web3 & Crypto hype train is receiving some essential maintenance while people board the AI northern line to the moon.
For those unfamiliar with OpenAI, it was started as a non-profit organisation by Elon Musk & Sam Altman with an aim to “build value for everyone rather than shareholders” and it would “freely collaborate” with others in the field to do so. This structure was driven by the potential dangers of the technology.
Since then, the company has received billions in investment (most notably from Microsoft) and launched a suite of various AI tools, including ChatGPT which took five days to reach 1 million users.
The excitement around this technology has been counteracted by an equal amount of fear. Elon Musk is now actively against OpenAI’s way of doing things, signing an open letter requesting large AI experiments to be paused.
At a macro level, the concerns in this letter are dystopian and terrifying. At a micro level, industries are being threatened, proprietary data sets are being illegally scraped and new companies are being created in their thousands to benefit from this generational innovation.
There are two ways to look at it. There are the concerning geopolitical ramifications as Russian President Vladimir Putin said whoever becomes the leader in AI technology “will be the ruler of the world.”
On the other hand, as mentioned above, the global economy is drowning in debt and one way out of this is through driving GDP growth via new technologies and innovation like AI.
Either way, the speed of evolution and the potential impact on humanity is so stark that all we can do as bystanders is watch and hope for the best.
Investment / Fundraise in Focus - Oxbotica $140m Series C:
Oxbotica’s $140m Series C fundraise recently caught my eye, an autonomous vehicle software company that preaches for ‘universal autonomy’ for its customers. It’s a space that has been frenetic over the last decade, but the potential impact on the world remains fierce.
The capital injection will help with their international expansion into new markets and they will target a wide range of industries including agriculture, airports, energy, goods delivery, mining and shared passenger transportation domains.
With Ireland in a housing crisis, I have a disposition to learn about how technology solutions can alleviate socio-economic issues. This month, that focus has turned towards the impact that autonomous vehicle space can have on Ireland’s housing situation.
Ireland’s precarious housing position has stemmed from poor planning and sub-par investment leading to a lack of affordable housing, which has since spilled over to the streets. Homelessness is now a visible issue.
Irish cultural norms, such as an insistence on living in houses and not apartments like much of the rest of Europe have not helped the issues. Similarly, a non-sensical refusal to build upward has exacerbated the issue.
However, going forward, I am excited by the potential disruption autonomous vehicles can have on real estate markets by altering people's commuting patterns and preferences.
With the ability to work or relax during their commutes, people may be willing to trade longer travel times for a more desirable living environment or lower housing costs
Vehicle owners could also go to work and earn a secondary income stream through their very own robo-taxi which would free up under-utilised urban car parking spaces (5% of urban land is parking spaces - about 14 Hyde Parks in London!
The introduction of self-driving cars, the need for personal car ownership may decline as people shift towards shared mobility services, enabling a greater return on automobiles (cars are typically parked 95% of the time)
Ireland's housing policy needs re-addressing but hopefully, technological advancement can also play its role in alleviating the issue.
Content Corner:
First Republic Fails: This is the third mid-sized bank taken over by FDIC in 2 months. Read about JP Morgan taking it over here.
Founders Programme by Dogpatch Labs: Ireland has launched its first ‘talent accelerator’ for prospective entrepreneurs. For anyone interested, there is a great article on it here, and you can find out more here.
Pause Giant AI Experiments: An open letter signed by many influential business people, including Elon Musk, on the concerns around large artificial intelligence experiments and the risk it has on humanity here
The Paradox of Choice: For anyone who is unaware of this book, there is an amazing Ted Talk on the concept here.
Writing Simply by Paul Graham: He has a beautiful set of short essays on ideas he has hosted here. This is his philosophy on writing, focusing on the importance of the reader digesting an idea rather than expending energy on unnecessary prose.
Science Can Answer Moral Questions: A Ted Talk by Sam Harris here on his belief that science can and should be an authority on moral issues, shaping human values and setting out what constitutes a good life
Stripe Doing Stripe Things: Stripe have republished Poor Charlie’s Almanack, the iconic collection of Charlie Munger’s speeches and mediations here.
Irish Housing Prices Fall for First Time in 10 Years: Check it out here.
Dying at 25, Being Buried at 75: An interesting thread here on how to avoid this fate.
Ireland’s SWF: Ireland are exploring plans to launch their over sovereign wealth fund here.
US Debt Spiral: A harrowing account of what a debt spiral is, and the US fiscal position here
Memes:
Thought Provoking Graphics: