Weekend Reads: 2016 Surprises, Con Artists, and Chef’s Table

Here’s an interesting question to ponder as you look out at 2016: “What pain do you want in your life?” Or said another way, “What are you willing to struggle for?” This, writes Mark Manson, is “The Most Important Question of Your Life.”

“At the core of all human behavior, our needs are more or less similar,” he says. “Positive experience is easy to handle. It’s negative experience that we all, by definition, struggle with. Therefore, what we get out of life is not determined by the good feelings we desire but by what bad feelings we’re willing and able to sustain to get us to those good feelings.”

Here are some other interesting reads, in case you missed them:

Investing and Crystal Balls

• As Bob Seawright points out in “Here We Go Again, Forecasting Follies 2016,” we’ve entered “the Wall Street ‘silly season’ of predictions and forecasts for the New Year.” While there “is nothing inherently wrong with them,” he says, “and they can be very entertaining indeed,” investors should not take them seriously. “Keep your attention focused squarely on specific needs, goals and what you can actually expect to control about your portfolio and its results. That might be a New Year’s resolution worth keeping.” (Above the Market)
• Meanwhile. economist John Kay, who is speaking next week at CFA Institute 6th India Investment Conference in Mumbai, bemoans the belief that economics is clairvoyance. He references Superforecasting, by Philip Tetlock and Dan Gardner, and the distinction between hedgehogs and foxes. Hedgehogs know one big thing, while foxes know many little things: “Foxes Make Good Economic Forecasts But Hedgehogs Can Be Helpful” (Financial Times)
• “Indexes, Accounting and ATM Fees” (BloombergView)
• Ben Carlson, CFA, shares a few truths about bear markets in stocks. He also offers a few words of advice to “newly minted contrarian investors.” (A Wealth of Common Sense)
• “Three Value Investors Meet in a Bar” (The Investor’s Field Guide)
• At the end of every year, it’s easy to get bogged down in seemingly endless “best of” lists, but this is a respectable roundup: “The 50 Best Investing Insights of 2015” (Fund Reference)
• Critical thinking is in short supply, says Seawright. Why? “While information is cheap and getting cheaper, meaning is increasingly expensive. We are beset by confirmation bias, our tendency to look for and accept evidence that supports what we already think we know and ignore the rest. Per motivated reasoning, we tend to reject new evidence when it contradicts our established beliefs. Sadly, the smarter we are, the more likely we are to deny or oppose data that seem in conflict with ideas we deem important.” (ThinkAdvisor)
• Aside from a few equities, the US markets are in a slump with concerns that the recent post-crisis bull market has petered out: “Equities: And Then There Were Nine” (Financial Times)
• Want to find out the best to worst investment returns by asset class over the past 15 years? Click on the link in the tweet below and hover over the table to highlight the asset class returns. (Novel Investor)

Updated Asset Class Returns Through 2015 https://t.co/fuj8czwWZT pic.twitter.com/sszJLPdH9t

— Novel Investor (@NovelInvestor) January 4, 2016

• Blackstone’s Byron Wien recently issued his “Ten Surprises for 2016” — the 31st installment of his annual list! According to Wien, a “surprise” as something that the typical investor would predict had a one-in-three chance of happening but that Byron anticipates is “probable,” that is, has a better than even chance of occurring. To quote one Twitter commentator: “As usual, Byron Wien has a couple of doozies in his annual Surprises list.”

Investment Advice

• Fidelity’s David Canter shares a list of the 16 trends he expects will be seen in the RIA space this year. (Financial Planning)
• “The Impact of the Fiduciary Standard on the Finance Industry” (A Wealth of Common Sense)

Building More Diverse Teams

• In a recent article on “Why Diversity and Inclusion Will Be a Top Priority for 2016,” Josh Bersin of Bersin by Deloitte makes a persuasive case for why companies that build truly inclusive cultures will outperform their peers. “People perform best when they feel valued, empowered, and respected by their peers . . . When we feel included and respected, our bodies create hormones and healthy energy that raises our performance at work.” Bersin recently completed a two-year research study, High-Impact Talent Management, and the findings are compelling: Among the 120-plus different talent practices examined, those that predict the top performing companies all concentrate on what the researchers describe as an “inclusive talent system.” (LinkedIn)
• Is your company a great place for advancing women? There are only four things organizations need to do to advance women. (Huffington Post)
• “As of February 2016, there will be only 21 female CEOs running Fortune 500 companies — down from 24 in 2014”: “Why 2015 Was a Terrible Year to Be a Female Fortune 500 CEO” (Fortune)
• A conversation about women and confidence — or the lack thereof. (Brown Brothers Harriman)
• As James Surowiecki points out in”Valley Boys,” his examination of the tech industry’s gender disparity, “Promoting diversity isn’t, as many techies think, pure do-gooderism. It’s genuinely good for business, since a large body of evidence suggests that making organizations more diverse can also make them perform better.” He notes that while tech companies may believe they are meritocracies, unconscious biases influence their hiring and promotion habits. “Subverting these biases requires more than training. Instead, companies should be looking for . . . ‘bias interrupters’: systems that identify bias and intervene to mitigate it.” (The New Yorker)

And Now for Something Completely Different

• “Keep Things Simple for a Healthy, Long Life” (National Public Radio)
• Pagan Kennedy wonders “whether we can train ourselves to become more serendipitous. How do we cultivate the art of finding what we’re not seeking?” in “How to Cultivate the Art of Serendipity” (The New York Times)
• One of the best things about time off over the busy holiday season is the freedom to catch up on books, magazine articles, documentaries, and a television mini-series or two. And, wow, did I come across a winner in the latter category: Chef’s Table, a six-part docu-series released in April 2015. As Bon Appetit magazine put it in a headline: “If You Liked ‘Jiro Dreams of Sushi’, You’ll Love the Director’s Mouthwatering New Netflix Series.” (And, yes, I loved Jiro Dreams of Sushi.) Each of the six hour-long episodes profiles a different chef: Massimo Bottura of Osteria Francescana in Modena, Italy; Dan Barber of Blue Hill in New York City; Niki Nakayama of N/Naka in Los Angeles; Ben Shewry of Attica in Melbourne, Australia; Francis Mallmann of El Restaurante Patagonia Sur in Buenos Aires; and Magnus Nilsson of Fäviken in Järpen, Sweden. Each episode is pure nirvana.
• More on catching up on reading: I’m heading to India next week, and I’m not sure which I’m more excited about: being back in Mumbai or having the time during the long haul to begin H Is for Hawk by Helen Macdonald. Kathryn Schulz’s review is, in and of itself, worth reading for its mastery. (Take this description of grief, for example: “Like a tent poorly staked, she is filled by the storm that is grief and blown away.”) Maria Popova also writes rhapsodically about the book: “Every once in a while — perhaps thrice a lifetime, if one is lucky — a book comes along so immensely and intricately insightful, so overwhelming in beauty, that it renders one incapable of articulating what it’s about without contracting its expansive complexity, flattening its dimensional richness, and stripping it of its splendor. Because it is, of course, about everything — it might take a specific something as its subject, but its object is nothing less than the whole of the human spirit, mirrored back to itself.” (The New Yorker, Brain Pickings)
• For parents of boys: “‘Boys Have Deep Emotional Lives’” (The Atlantic)
• Ever wondered, “What makes a con artist, and why are we duped by them?” Maria Konnikova’s new book, The Confidence Game, delves into the question. Here are two recent pieces on the topic by the author: “How Stories Deceive” and “Born to Be Conned.” (Kirkus Reviews, The New Yorker, The New York Times)
• If you’re sitting outside the United States, how does your economy compare to the US states? (Agenda)

How does your economy compare to #US states? https://t.co/wje8OWU4uf #economics pic.twitter.com/qNrKY5ZuAN

— World Economic Forum (@wef) January 4, 2016

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All posts are the opinion of the author. As such, they should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute or the author’s employer.

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