Author: Snippet.Finance

Misc

Pricing Data

  • Fascinating read on how to price a data asset.
  • Relevant especially with the rise of AI. At first quantity matters here but “as training sets grow ever larger, it’s often more efficient to do this than to acquire the next token; beyond a certain point, data quality scales better than data quantity“.
  • “So there you have it: 5000+ words on data pricing. We’ve covered use cases and users; quality and quantity; internal and external value factors; pricing axes and maturity curves; table stakes and usage rights; and much more.“
Stocks

Average is not Median

  • “Antti Petajisto analyzed the return distribution of all US stocks in the CRSP database going back to 1926. Below is the distribution of returns for different investment horizons. Note that the distribution gets more and more skewed to the left as investment horizons increase and that the left-hand side of the distribution is not zero, but a total loss of investment (-100% return).“
  • Source.
Macroeconomics

Myth of Deglobalization

  • Deglobalization is a narrative that is prevailing in the press.
  • Brad Setser argues that this isn’t the case.
  • “China’s surplus in manufacturing has risen as much relative to world GDP in the last few years as it did during the first China shock following the country’s accession to the WTO“
  • A big driver of this is the export of Chinese manufacturing into Vietnam and other countries for final export.
  • “the reality is more complex: put plainly, it is impossible for a global economy characterized by a large U.S. deficit on one side and a large Chinese surplus on the other to truly fragment.“
  • Corporate tax avoidance also boosts globalization – “American multinationals now often produce abroad to book large profits in offshore tax havens“.
Stocks

Shein and Temu – the tax loophole

  • Shipping goods with a value less than $800 in the US (150 EUR in Europe) is import duty free – something Chinese firms have been taking advantage of.
  • By some estimates these firms account for 30% of these de minimis shipments in the US. Most is by air freight.
  • This is all about to change in the EU. Will the US follow?
Macroeconomics

Jobs Data

  • The two main US jobs surveys – the famous non-farm payrolls (establishment) and household survey – are broken.
  • For one there is a stark difference in trajectory between the two.
  • Response rates are also collapsing.
  • “Totting it all up, ABN Amro finds that the gap between the two series is driven largely by underestimating immigration, and overestimating business births, and then definitions.“
Misc

Failure Mindset

“Perfection is impossible. In the 1526 singles matches I played in my career, I won almost 80% of those matches. Now, I have a question for you.

What percentage of points do you think I won in those matches? Only 54%.

In other words, even top-ranked tennis players win barely more than half of the points they play. When you lose every second point on average, you learn not to dwell on every shot.

You teach yourself to think, okay, I double-faulted … it’s only a point. Okay, I came to the net, then I got passed again; it’s only a point. Even a great shot, an overhead backhand smash that ends up on ESPN’s top 10 playlist. That, too, is just a point.

And here’s why I’m telling you this. When you’re playing a point, it has to be the most important thing in the world, and it is. But when it’s behind you, It’s behind you. This mindset is really crucial because it frees you to fully commit to the next point and the next point after that, with intensity, clarity, and focus.

You want to become a master at overcoming hard moments. That is, to me, the sign of a champion. The best in the world are not the best because they win every point. It’s because they lose again and again and have learned how to deal with it. You accept it. Cry it out if you need to and force a smile.”

— Roger Federer (via FS).

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