EIEIO...What Doesn't Kill You...
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EIEIO…Fast Facts
Entrepreneurship: 5,481,437 – The number of new businesses started in the US in 2023, a record (Commerce Institute)
Innovation: 90% – The percentage of commercial drones in the United States that are Chinese-made (
)Education: 7.2 million – The number of Americans over 50 who hold student debt (Inside Higher Ed)
Impact: 89% – The percentage of transplant recipients who reported personality changes after undergoing transplant surgery (MDPI)
Opportunity: 200,000 – The number of New York households being added to the waitlist for the state’s Section 8 Voucher program after 600,000 households applied during a 1-week window in June (Gothamist)
From time to time we like to revisit past commentary, both as a way to hold ourselves accountable for what we put into the ether and to continue developing the themes we've built upon.
We live in a turbulent, dynamic world, and that’s a fact that never changes. Our aim is to provide a systematic, strategic framework that remains resilient and doesn’t get whipsawed by every change in the wind.
We wrote “EIEIO…Progress, Not Perfect” in March 2023. We stand by the post; there is not much we argue with in hindsight. The sentiment of the piece has resonated greatly in the past month when it has felt like the entire world is on the brink.
In the past 30 days, we’ve seen history-altering event after history-altering event. The history book writers of the future will have their work cut out for them when rehashing the summer of 2024. As a refresher, July and (the first 10 days of) August have brought us:
July 13: An assassination attempt was made on former President Donald Trump.
July 21: Sitting President Joe Biden dropped out of the 2024 Presidential Election.
July 26: Arsonists attacked the French high-speed rail system hours before the opening ceremonies of the Paris Olympics.
July 30: Violent riots erupted in various parts of the UK following a stabbing attack at a young girl’s birthday party.
July 31: Mossad assassinated Hamas leader Ismail Haniyeh in Iran.
August 1: A significant US-Russia prisoner exchange occurred, featuring the return of WSJ journalist Evan Gershkovich, among others.
August 5:The DOJ ruled that Google has an illegal monopoly on search.
August 5: Wall Street had its worst day in nearly two years after a global sell-off. The VIX peaked at over 65.
August 7: Three Taylor Swift concerts in Vienna were canceled after plans for an ISIS-inspired concert terror attack were foiled.
August 10: The Trump Campaign indicated its emails were hacked by Iranian actors.
…Just to name a few.
The United States, in particular, continues to find ways to advance through chaos. Even in the most uncertain times, we would never be so foolish as to bet against America.
We are reminded of the insights from Matt Ridley in his book The Rational Optimist: How Prosperity Evolves. His perspective encourages us to zoom out and consider the broader data, which highlights the utterly remarkable progress made over the past century.
Onward and upward.
Below is EIEIO…Progress, Not Perfect, which we published on March 26, 2023.
Elements in bold are updated (August 2024) data and additional commentary.
“For those that don’t know history…everything is unprecedented.” – Condoleezza Rice
“The precautionary principle - better safe than sorry - condemns itself: in a sorry world there is no safety to be found in standing still.” – Matt Ridley
“Success is not final, failure is not fatal. It is the courage to continue that counts.” – Winston Churchill
What a mess.
A global pandemic resulting in millions of deaths and disruption. Bank runs. Racial tensions. Catastrophic war. Geopolitical fragility.
While these could be headlines today, these were the same problems we had 100 years ago.
In the early 1920s, the Spanish Flu pandemic had raged for over two years, killing 50 million people globally (versus 6.8 million >7 million for COVID) and 675,000 Americans. WWI had just come to a close with a death toll of 22 million (the cost of US involvement in the war was over 50% of total American GNP).
Moreover, Americans were only a few years into a decade-long banking crisis. 600 banks failed per year from 1921 and 1929. Racial violence was omnipresent. KKK nationwide membership had ballooned to 2 million people and led to atrocities like the Tulsa Massacre in 1921 (injuring 800+ people and killing up to 300).
If you were a young high school graduate 100 years ago, it would be understandable if you thought you got dealt a bad hand. And perhaps as you were thinking that the only good news was that it couldn't get any worse, 1929 was the beginning of the Great Depression. The following decades brought the Dust Bowl, WWII, the Korean War, the Cold War, and continued racial turmoil – to name just a few of the 20th century’s greatest hits.
Even with all these crushing problems American society has faced, life has moved up and to the right for the country. GDP per capita has gone from $6,460 to $76,658, life expectancy for a male has gone from 53 to 76, and the Dow Jones Industrial Average has gone from $90 to $33,000 ~$40,000 (44,344.4%).
It's ironic that many young people today, overwhelmed by anxiety about the future, often find themselves yearning for 'the good old days'—a time that was, in fact, significantly tougher. Selective nostalgia is counterproductive. Though the past century was plagued by crises, conflicts, and disasters (just like every other era in human history), the progress made during the same timeframe was utterly world-changing. People have gotten healthier, wealthier, and wiser at incredible rates, and our continued positive trajectory as we head into the Brave New World is cause for optimism.
Healthy
It was not long ago that strep throat was usually fatal, ear infections commonly developed into chronic conditions, and the only treatment for tuberculosis was “fresh air”.
From 1915 to 1997, infant mortality dropped by 96%
From 1913 to 2013, average global life expectancy went from 34 to 71 years
This great news poses a whole new set of challenges and opportunities. For example, the number of centenarians in the US is expected to quadruple in the next 30 years.
Source: Pew Research
Since its first use as a medicine in 1942, it’s estimated that Alexander Fleming’s discovery of penicillin has saved
over200 million(update: according to some estimates) ~500 million) lives.
Wealthy
From author Matt Ridley’s The Rational Optimist – In 2010, of Americans officially designated as ‘poor’, 99% had electricity, running water, flush toilets, and a refrigerator; 95% had a television, 88% a phone, 71% a car, and 70% air conditioning. Cornelius Vanderbilt had none of these.
In 1910, 74% of the world was living in extreme poverty. In 2015, that number had plummeted to 10%.
In 1920, the United States barely had a middle class. According to 2021 data,- 50% of American adults live in middle-class households.
In 1920, about 10% of American households owned stock. Today, nearly 60% own stock.
Wise
In 1920, just 17% of Americans graduated from high school and a mere 5% graduated from college. By 2019, those numbers had risen to 86% and 38%, respectively.
Due to advances in structural engineering and improvements to emergency response, there has been a 92% decline in the decadal death toll from natural disasters since its peak in the 1920s. In that decade, 5.4 million people died from natural disasters. In the 2010s, 400,000 did. During that same period, the global population nearly quadrupled.
The transition from a manufacturing-based economy to a knowledge-based economy caused workplace injuries and deaths to plummet. In 1907, Allegheny County, Pennsylvania (population 1 million) experienced 526 deaths from “workplace accidents.” In
20192022, the number of workplace fatalities for the entire state of Pennsylvania (population12.8 million13 million) was154183.
We talked more about this in EIEIO…Working for the Weekend (May 20, 2024):
“Where we see the earliest adoption of robots is in jobs that are dangerous, disgusting and/or dreary. Currently, there are over 10 million unfulfilled jobs in America, mainly because the people not working don’t want them.”
Dangerous
Logging
Fatal injury rate: 82 per 100,000 full-time workers
Most common fatal accident: Contact with objects and equipment
Example company: Outreach Robotics
Commercial Fishing
Fatal injury rate: 75 per 100,000 full-time workers
Most common fatal accident: Transportation incidents
Example company: Sea Robotics
Roofing
Fatal injury rate: 59 per 100,000 full-time workers
Most common fatal accident: Falls, slips, and trips
Example company: Renovate Robotics
It hasn’t been perfect, but we’ve seen much more progress than pain over the last 100 years. We’re entering a Brave New World, and the most important currency won’t be money – it will be time. Ben Franklin wrote that “Time is Money” in 1748…the same is true today.
While the concept of “Time is Money” has been around for a while, what’s changed is the agency in how we choose to allocate our time. The 1900s was a century that shifted peoples’ focus from surviving to thriving; with each new technological breakthrough, more people were able to focus on the next new challenge.
New innovations are allowing peoples’ payback on time to dramatically increase. We’re already seeing this with knowledge workers and LLMs – 1 in 5 Americans can do their job at least 50% faster thanks to AI.
While we’re just as excited about ChatGPT as the next person, the massive impact of this time dividend will also be in the world of atoms, not just bits.
The Time Dividend is a theme we have continued to build upon in our research over the past ~18 months since publishing Progress, Not Perfect.
“Time Dividend: Time compression and productivity unlock.” (EIEIO…Early Bird Gets the Turd)
“We can sum up what we see coming: Time Dividend * Knowledge Proliferation = Innovation Explosion.” (EIEIO…Here Comes the Sun)
“The time dividend will allow for an unprecedented level of innovation and human flourishing. Entrepreneurship will BOOM.” (EIEIO…Working for the Weekend)
“Artificial Intelligence done right will create a “time dividend” for us but we still will do what we want to do versus what we should do…that’s human nature.” (EIEIO…Hooray for Hollywood!)
“While some believe the time dividend we'll receive as shareholders of planet Earth will be spent on trivial pursuits, I foresee an explosion of innovation and human advancement beyond most people's imagination.” (EIEIO…Learning at the Speed of Light)
“With powerful AI and the time dividend, we have the opportunity to reconceptualize how we acquire knowledge and dramatically increase our mental clock speed.” (EIEIO…Learning at the Speed of Light)
“Investing our time dividend by developing uniquely human skills and knowledge—areas where our machine counterparts can't compete—is key to society's prosperity.” (EIEIO…Learning at the Speed of Light)
“. . .Things you’ve got to know about AI in learning: how it will enable personalized learning and tutoring, teacher tools and how they create a time dividend for educators. . .” (The GSV Big 10: The Big Tent)
Let’s start with travel in the United Arab Emirates. At the Dubai Airport, travelers’ eyes become their passports. This doesn’t just get you through security quicker…it lets the person who used to stamp passports do something more human. A computer should do anything it can do better, cheaper, and faster than a human (as an aside, going from Dubai to the Delhi Airport Passport Control was like going from the Jetsons to the Flintstones).
This year, Dubai will have self-driving taxis. Anybody who’s been in a taxi flying up and down Sheikh Zayed Road knows that in the worst case, an autonomous taxi couldn’t be any more dangerous than the human version. It’s estimated that autonomous vehicles will reduce auto deaths by over 90%. Moreover, autonomous vehicles will unlock a significant productivity boost. Americans currently spend an average of nearly 300 hours (or 7.5 work weeks) per year behind the wheel.
Dubai, which has become the Window to the Future (and by the way, recently opened up the Museum of the Future), will have flying taxis by 2026.
And by 2030, Boom Overture will introduce supersonic jets that fly twice as fast as standard jets. Initially, this means going from Dubai to Singapore in 4 hours. The company’s long-term mission is to get anywhere in the world in four hours for $100.
The United Arab Emirates isn’t just following the path to the future; they’re building it. As Marc Andreessen puts it,
“Our nation and our civilization were built on production, on building. Our forefathers and foremothers built roads and trains, farms and factories, then the computer, the microchip, the smartphone, and uncounted thousands of other things that we now take for granted, that are all around us, that define our lives and provide for our well-being. There is only one way to honor their legacy and to create the future we want for our own children and grandchildren, and that’s to build.”
Technology creates time…the question is how people will spend it. In 1930, John Maynard Keynes famously wrote an essay titled “Economic Possibilities For Our Grandchildren."
In the essay, he predicted that by the time his children had grown up, people might be working just 15 hours a week. While Keynes got some things right, this particular prediction was a Freezing Cold Take.
There are lots of reasons why he was wrong, but the most important one is the fact that people want to make the most of their time on Earth – and that includes their profession. A McKinsey study found that 70% of people across industries define their purpose through their work.
More innovation has meant more time, and more time has meant better outcomes. Take chores for example. More electrical appliances, fewer hours spent doing housework per family per week. These inventions also gave way to a major rise in female workforce participation in the United States.
By focusing on what people are put on Earth to do and taking advantage of how technology can do automatable things, the possibilities become open-ended and wildly exciting for our future.
Technology will give us more free time, and people will have to choose whether to spend their “time dividend” endlessly pursuing different forms of R&R or trying to make a difference in the world. We need more people to choose the former if we want to attack and solve the World’s Hardest Problems in the next 100 years with the same vigor as we did in the past 100.
We already received a sneak peek at this dilemma during the COVID lockdown. The most disciplined people got focused and started businesses while others filled their time in quarantine compulsively online shopping. As Lou Holtz says, “You get better, you get worse. You don’t stay the same.”
In some ways, COVID was a precursor of things to come – a world where we’ll all have more time to focus on what we truly care about. Flying taxis and faster writing won’t just make our lives easier…they’ll make them more meaningful. As Linda Ellis puts it in “The Dash”:
For it matters not, how much we own,
The cars...the house...the cash.
What matters is how we live and love
And how we spend our dash.
Our belief isn’t that people should have a fulfilling life working 12 hours a day in a coal mine. It’s clearly the opposite. But working and feeling like what you’re doing matters is an important part of the living experience. It’s not man versus machine; it’s man and machine.
Make your dash count!
Market Performance
Market Commentary
So much for the “lazy, hazy days of summer” – the VIX hit a whopping 65 on Monday.
Before many U.S. investors had tucked themselves in bed after a beach Sunday, the Japanese market had gone into a free fall, dropping 12%. Global markets, including the U.S. responded in kind with the worst day for the S&P 500 in 2 years.
Much of the panic was catalyzed by a perception that the Fed was behind the curve and had seen the dramatic slowdown in the U.S. economy until after the fact. Supporting that point was July’s new jobs number of 114K, significantly below expectations. The 4.3% unemployment rate, while amazing from a historical perspective, continued inching upward supplying another ingredient to panic.
To the rescue came second-quarter financial results with META, Shopify, Uber, and Palantir putting up strong results in tech world. In eat world, Sweetgreen and CAVA continued to prove the Peter Lynch “buy what you know” philosophy with each stock soaring.
For the week, after a lot of commotion, the S&P 500 was essentially flat, the NASDAQ was down less than .2% and the Dow fell .6%. The S&P and NASDAQ are still up 12% and 11.6% YTD, respectively but have taken a few steps back.
Volatility is likely to continue in the market with the CPI and PPI numbers being bell-weather data points this week. Our view continues to be BULLISH for long-term growth investors. Accordingly, we’d look at short-term drops in high-quality names as a buying opportunity for investors with a time horizon longer than a couple of months.
Need to Know
READ: The Great AI Unbundling | Every
WATCH: Gold Medal Effort From Quincy Hall | NBC Olympics
READ: Mostly Multiples 8/4: The Most Important Fed Meeting in Recent History |
READ: How The Regime Captured Wikipedia | Pirate Wires
READ: Welcome to Y’all Street, Texas’ Burgeoning Financial Hub | WSJ
GSV’s Four I’s of Investor Sentiment
GSV tracks four primary indicators of investor sentiment: inflows and outflows of mutual funds and ETFs, IPO activity, interest rates, and inflation.
#1: Inflows and Outflows for Mutual Funds & ETFs
#2: IPO Market
#3: Interest Rates
#4: Inflation
Charts of the Week
Maggie Moe’s GSV Weekly Rap
Chuckles of the Week
FEEDBACK: We love it when our readers engage with us. Send your thoughts, comments, and feedback to dashmediagsv@gmail.com – we read every email!
Connecting the Dots & EIEIO…
Old MacDonald had a farm, EIEIO. New MacDonald has a Startup….EIEIO: Entrepreneurship, Innovation, Education, Impact and Opportunity. Accordingly, we focus on these key areas of the future.
One of the core goals of GSV is to connect the dots around EIEIO and provide perspective on where things are going and why. If you like this, please forward to your friends. Onward!
Make Your Dash Count!
-MM
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