A Formula To Be More Excited (& Less Worried) About The Future
The Infinite Scene
|E.M. Rooster||Sep 9, 2019|
Most of what you read these days covers actionable ideas with relatable time frames:
2 days or even 2 years. The time frame for this idea is 2 decades-plus.
You will get out of the box thinking from me sometimes but it comes with a connecting thread running it -- which you will profit from. The thread here will run for decades.
I’m going to talk about The Future, The Fear of it and Fixing those Fears.
We have worries about the future. I’m talking about how to survive the big unknown about the future: Change and its impact on our lives -- jobs, health, safety and family.
There’s a joke from a startup guy who said, “I sleep like a baby, I wake up crying and needing to poop every couple of hours.” Same. On the spectrum of humans worrying, there’s people like Buddha on one end, who does great - living his best life in the present. Not me, (I might be in danger of looking like the Buddha with my diet.)
I live with images of the future on the brain and I write about it. I am constantly reminded about how life in the developed and online world is futuristic compared to just 20 years ago.
When I was in school I used to write about the future of life - it was science fiction. The funny thing is most of it happened or is on the verge of happening. Thinking back I wrote about ideas like commercial spaceflight, social networks, the potential of personal publishing, and even co-working. I was not an engineer but just a guy with too much free time plus a lot of imagination.
Life 20 to 25 years ago had its imperfections. The Cold War just ended and millions of people living in State-owned economies were free but now they had to figure out how to build new ways of living. New startups were about to emerge on something called “The Internet”. There was an unexpected hit show called Friends (a bunch of 20-somethings lived in impossibly large apartments compared to their jobs!). Apple Computer had lost its shine and was doomed.
And yet the world went on -- the future became the present.
These days we wonder if our lives will be turned upside down by a variety of tech-future horror tropes straight out of Netflix’s Black Mirror:
Robot overlords that can learn new things 24/7, walk, fly (and worst of all know all of our browser histories). The disruption of all of financial system via crypto protocol tech. The rise of gene-modified monsters coming for us (some mosquitoes recently on the loose from a lab in Brazil or just your ordinary antibiotic resistant mutated infection making the rounds in a big hospital). The dread that a decade of quantitative easing devolves into a financial “forever war”. The fear that an epic decade of VC funding of disruptive startups will eliminate millions of jobs virtually overnight faster than can be replaced by innovative cures for job losses, worsening the widening social divide of haves and have nots.
I wonder how will I live and make a living, and help and look after my loved ones. I have three cures for when I catch a future fear fever: family & friends, working on something, and learning something helpful.
I like to read information which gives me the bad news first but then says “Okay, let’s take a step back, look at the bigger picture and let me explain that it’s not all bad.” That definitely includes reading anything about the economy.
My view of the economy is that it’s a tennis match -- where the fuzzy ball of the future gets smacked back and forth between “we’re gonna fix this, they’re gonna invent this, the market clears itself” to “omg we’re in trouble, they can’t fix this, the economy is toast”.
Even when times are good we wonder “is the market in trouble?” As I said, I like to read the “bad news first” information but not from professional Doctor Dooms or their bullish opposites. I think someone who is in the middle is financial writer Carmel Urban.
Urban published a chart-fest on the current macro landscape. He said there would be little chance of a recession in 2019. Odds of a 2020 recession? That’s a maybe.
Carmel runs an econ/finance site, “The Fat Pitch”. And he’s neither an overly-optimistic Pollyanna nor a Doom-and-Gloomer, but the headline from his latest piece, “September Macro Update: Rising Possibility of a Recession in 2020” tickled my panic button a little. (That sounded weird. Anyway…)
Now before you get upset please, relax, take a breath, and stay with me.
Urban starts with “inverted yield curve” which triggers a worry about 2020 but then quotes JPM’s view on one part of the bond market, “High yield spreads are normal and default rates remain below average. This part of the bond market is not signaling trouble.”
And there’s more “don’t panic yet” observations. I’m cherry picking some quotes:
High yield spreads are normal and default rates remain below average. This part of the bond market is not signaling trouble.
real retail sales grew 1.6% and made a new all-time high (ATH) in July.The trend remains higher, in comparison to the period prior to the past two recessions.
Unemployment claims reached a 50 year low in April (just 4 months ago). Historically, claims have started to rise at least 7 months ahead of the next recession.
Average hourly earnings growth was 3.2% yoy in August; February's rate of 3.4% was the highest in 10 years. This is a positive trend, showing demand for more workers. Sustained acceleration in wages would be a big positive for consumption and investment that would further fuel employment.
In the past 50 years, a median of 28 months has lapsed between new home sales' expansion high (arrows) and the start of the next recession; so far, the cyclical high was in June, just 2 months ago, which suggests that the next recession is still a ways ahead.
The Conference Board's Leading Economic Indicator (LEI) Index reached a new uptrend high in July. This index includes the indicators above plus equity prices, ISM new orders, manufacturing hours and consumer confidence.
This [LEI] index can fluctuate during an expansion but the final peak has been at least 7 months before the next recession in the past 50 years, which also suggest that the next recessions is still a ways ahead (from Doug Short).
So, we have reasons to remain calm. Urban concludes with a sober and calm opinion:
On balance, the major macro data so far suggest continued positive, but slowing, growth. This is consistent with corporate sales growth. SPX sales growth in 2019 is expected to be about 5% (nominal).
Valuations are slightly above their 25 year average. The consensus expects earnings to grow only about 3% in 2019 but there is room for faster equity appreciation through valuation expansion.
So the good news is that the party is not ending yet. But it will happen. And after a long stretch of good times a party-crasher is coming. We remember how he was the last time he showed up. He Jackson Pollocked the walls with leftovers from what used to be a sumptuous buffet table and flipped over all those punch bowls filled with 100 proof happy juice. After he’s done, we’ll be like that old song - and realize we’re a year older and deeper in debt.
So, that’s what I’m afraid of. What if it all goes upside-down? What if the recession comes and hits me hard? What if monsters come out of the basement, straight for me? What to do? What can I do about it? Not a damn thing in terms of the economy. It’s going wherever it’s going to go.
BUT I can do something about me. Stay with me. I’m about to get into ideas for this “what to do” answer.
Let’s shift gears with ideas completely unrelated to macroeconomics. I hinted that I like to read and learn from balanced sources -- but also completely different sources of information and ideas. I then bundle it together into a new idea. The last step is writing about and sometimes it works.
I hope the following ideas will help, or at least distract and entertain, you from any random future fears you might have.
Short Answer: We are creative. And there are creators who are fascinating examples who point the way forward for us. Their work and stories are more relevant to your lives than whatever goes on in the news at The Fed.
A formula to help us face the uncertainty of the future and be more excited:
How To Face the Future =
Finding (or Building) a Scene +
Having an “Infinite Game” mindset and life +
Learning and Reinvention
Let’s break down this formula by studying people who used this formula with great success. Stay with me. None of these folks have MBA degrees.
Enter DJ Steve Aoki.
Joe Rogan had a recent podcast with global DJ start Steve Aoki, one of the masters of electronic music. Electronic music or global DJs may not be “your thing” but don’t delete this piece just yet, don’t close it. Relax. Take a step back and stay with me.
Rogan talked with Steve Aoki, founder of electronic music label Dim Mak Records and I found some out of the box ideas which I want to unpack. Aoki’s life was also featured in a Netflix documentary, “I’ll Sleep When I’m Dead” - which for me was a companion piece to the Rogan interview.
Aoki recounted his life growing up as one of the few Asians in an upscale predominantly white and wealthy enclave in California, Newport Beach. He didn’t grow up in a ‘nuclear family’ - his father, Rocky, was a larger than life entrepreneur who had a wife, several mistresses, and a love of publicity and stunts.
Aoki compared his father, Rocky, to Richard Branson, because of his father’s entrepreneurial success, outsized public personal and colorful “origin” story.
Rocky had qualified for the 1960 Japanese Olympic wrestling team but didn’t compete. Instead of accepting college wrestling scholarships in the U.S., he became a New Yorker and ran an ice-cream truck in Harlem while going to community college for business studies. What does an Olympic class wrestler from Japan do? Why he starts a Japanese grilled food restaurant of course.
The Benihana restaurant chain was named after the red safflower -- a bright red flower which Rocky’s father saw in the rubble of post-war Tokyo. That flower marked a spot where Rocky’s father, who was an entertainer who had to find a way to make a living, would start a business.
The restaurants served teppanyaki, food cooked on a large flat griddle by the chefs who prepared food with a ballet of knife work as if it were a show for patrons. The idea took off and Rocky became rich. But he didn’t just stop there. Rocky was a natural self-promoter known for dramatic stunts -- including a speedboat race which nearly killed him.
In contrast to his fame and public adulation Rocky was a distant father at home. Steve, raised by his traditional mom, grew up to become a straight-laced devotee of punk music who was not a drinker or partier -- but he was, like his father, a natural promoter of entertainment.
After finishing school, instead of joining his Rocky’s business, Steve survived on odd jobs and began a music label Dim Mak which focused on a new tech and musical trend - digital music. In terms of mainstream culture, nobody cared about DJs back then. Today however we have celebrity foodies and chefs, tech and startup gurus, and influencers. Aoki became one of the first global scale celebrity DJs. This did not happen overnight.
Over the last 20 to 25 years, Aoki went from record label founder of company -- that was always in financial distress in its early years -- to globe-trotting celebrity DJ., entertainment mogul and startup investor.
Maybe some of you only just learned about him from the Netflix documentary. You would think with the Internet, it’s easy to build a pop culture audience and go viral. But you have to remember that when Aoki began his journey Myspace was still a few years from launching and there was no Facebook, Twitter, Instagram, Snapchat or TikTok.
Aoki recently published a book about his life, Blue:The Color of Noise. The audio version is read by a professional narrator but in alternating chapters Aoki jumps in and reads, having recorded some chapters while he’s on tour, with a “you are on the tour” vibe.
So, what does an electronic music DJ have to do with our fears about the future?
Aoki invented a niche. And it took about 2 decades for Aoki to reach the heights of success as a basically someone who make a lot of money as the DJ of concerts with a mega-party atmosphere and some cake-throwing (don’t ask, the fans love it).
In recent years Aoki has been collaborating with scientists like Ray Kurzweil (a/k/a “Singularity is Coming”) and investing in cutting edge technologies. Aoki may have started with pizza deliveries and spinning platters but in between massive concert performances, he’s been investing in things like extending human life spans (as well as a chain of pizza restaurants).
Aoki played a long game, totally focused and constantly evolving. A long game with a niche focus is something we can do thanks to the technology at our fingertips. You are living in a time where tech give individuals leverage to adapt.
I have mentioned the phrase “long game”.
There’s a more powerful version of long games: Infinite Games
Let’s go to Cal Fussman and Simon Sinek for more on Infinite Games.
Cal Fussman, a former journalist and now popular podcaster and business advisor, talked with Simon Sinek about a long game known as “infinite games” - a way of both building a personal life and a work life with a long view. Sinek, a former advertising man, was building on an idea of an “infinite game” which was written by James Carse in the 1980s. He observed the real game most of us play in life.
Most of the time we live and play in the short-term games of working life, including the barriers, glass ceilings, and ruts we may hit. Those ruts include the scary things that can happen when an industry downsizes, when an economy shifts, or when life changes hits us when we’re not looking. This is what comes up when we worry about the future.
An “Infinite Game” values a path of continuous experimentation, learning and growth.
In an “infinite game” we take a different approach to work and life -- like DJ Aoki.
There’s one more important part of Aoki’s personal “infinite game”.
He created his own “scene”.
Remember that Formula For Facing the Future? Don’t bother scrolling, here it is again:
How To Face the Future = Finding (or Building) a Scene + Having an “Infinite Game” mindset and life + Learning and Reinvention
Not long after starting DimMak records, Aoki and his partner would host parties to promote his label’s music. Eventually a mixed crowd of gathered, made up of other successful and famous folks drawn in by common interests and fun. A “scene” emerged and crystallized around DimMak and Steve Aoki.
Scenes are another input in the formula -- and have been talked about by two people many of you know: Marc Andreesen and Brian Koppelman
Like Aoki, their path forward towards the future began 20 to 25 years ago.
Andreesen is famed for Netscape and the birth of the commercial internet, before 1993 or so, when it was illegal to do anything commercial on a tiny info network.
Netscape was in a “browser war” with Microsoft but he could cash out and ultimately started a mega venture capital firm.
Koppelman is the showrunner of Billions. Koppelman was a record executive who found salvation through working with a writing partner, becoming a movie maker and then television show-runner. Today, he’s a top story-teller who created movies like Rounders.
Both have podcasts and interview creators and entrepreneurs from all walks of life.
There’s a two part “crossover” podcast between Andreesen’s a16z venture capital podcast and Koppelman’s podcast,“The Moment”. Andreesen and Koppelman both interviewed each other on their respective podcasts. (Links from Podcast Notes provided.) They talked about the importance of the idea of “scenes” when it comes to finding personal and professional success.
The idea of “Scenes” is about finding our tribe, audience, clients and customers.
This idea is about how we can elevate our lives both personally and professionally by finding our “scene” - which is connecting and sharing with like-minded people.
Here are a few examples of scenes from history mashed together to hurt your eyes:
The Library of Alexandria, Andy Warhol’s Factory, The Founding Fathers of the American Revolution who connected through pamphlets (18th century blogs), Coffeehouse intellectual culture in late 19th/early 20th century Vienna, a young Jamie Foxx’s parties which gathered future stars, Supreme’s skater scene in downtown NYC which built a fashion cult following and raised $1B+ 20 years later, Bell Labs army of scientists, Xerox Parc’s team which created the first personal computers, and Joe Rogan’s massive podcast fandom, and of course Steve Aoki’s DimMak record parties.
The common thread of all these scenes: They began modestly, with less than a handful of people, all connected by common interests, doing something new.
I didn’t forget that we began with Urban Carmel and recession talk. When it comes to money and talking about what’s next for the economy, the future comes with a heavy dose of worry and fear thanks to disruption or even just the knowledge that a downturn or a recession will come (just not right now). It’s all scary no matter what.
And part of how I cope is to focus on learning, and applying what I learn as best as I can. And that learning is focused on the idea of reinvention.
Some of you have been there. Life hits us in different ways, we have to survive and then find the strength to start-over. To start-over means to reinvent and that means constant learning -- sometimes for life-changing moves in dramatic style. Enter Dapper Dan.
Marc Andreesen’s business partner, Ben Horowitz, interviewed Daniel R. Day, a/k/a Dapper Dan, a man whose life-story is a slice of modern American history up and close. The video and podcast is “Making Culture, Making Influence -- Dapper Dan in Silicon Valley”. Andreesen after reading the book told Horowitz that Dan was a real entrepreneur.
a16z’s interview description about Dan, just scratches the surface:
Dapper Dan pioneered high-end streetwear in the early 1980s, remixing luxury brand logos into his own designs for gangsters, athletes, and musicians, dressing cultural icons from Salt-N-Pepa and Eric B. & Rakim to Beyoncé and Jay-Z along the way.Going on to define an era, his work has been featured in exhibitions at the Museum of Modern Art, the Met, The Smithsonian, and more.
But he began as a hungry, fast learner in Harlem who became a gambler; spent a brief stint in a foreign jail where he nourished himself with reading; and then studied the market to build his fashion business, trendsetting the concepts of logomania and later, influencer marketing. Today, Dapper Dan has a unique partnership with Gucci and reopened his boutique in 2017.
From “the struggle” when not given the privileges and opportunities that others have to the struggle of building and then losing and then reinventing oneself again and again, this special episode offers inspiration for all kinds of makers -- including the power of “studying the game”; the power of listening to your customers (not in the cliché way!); and the power of cultural influence… and voice.
Dapper Dan discovered and built his own of scene, from within an underground 24/7 clothing design/tailor shop that went from making garments like bullet-proof puffy jackets for gangsters to reinventing euro fashion logos and creating Hip Hop fashion.
And like Aoki and Sinek, he also wrote book -- an autobiography, “Dapper Dan: A Life in Harlem”.
Just as Dan was being raided by the major fashion houses, his name was immortalized in rap lyrics by a new generation of musicians and fans who had no idea that the name was not just a metaphor but a real person.
In one quirky anecdote, Sonia Sotomeyor, a future US Supreme Court justice, was a lawyer who represented one of the companies that help shut down Dan’s original underground business. Dan now works with Gucci.
Let me jump back to the beginning -- about “is there a recession coming?” I don’t know but we’re not there … yet. But I do know two things, change keeps coming and no matter what we have to cope with it. That’s why I invested more time in this post for you.
It’s strange for me to understand that the same tech prosperity which we enjoy will also disrupt our lives in the future. We will need new jobs. Imagine a recession on top of that.
If Urban Carmel is right then we have some time before the next recession. I don’t know how much time. Regardless of how much, most of us hopefully will think truly big and consider living, working and playing inside of an “Infinite Scene” to help ourselves.
At the moment, I think about DJ Aoki, Marc Andreesen, Brian Koppelman, Cal Fussman, Simon Sinek and Dapper Dan,and what I think we can learn from them. They’re talking about a very long-term way of getting through life and the markets.
Let’s revisit again my formula for how to become more excited about the future.
How To Face the Future =
Finding (or Building) a Scene +
Having an “Infinite Game” mindset and life +
Learning and Reinvention
I call this formula an “Infinite Scene” - where we may start out with one focus, build a personal scene of friends and fans, and discover new opportunities along the way and share it with our every evolving scene. The advantage we have over DJ Aoki and Dapper Dan is that we have the Internet which helps us connect with many people.
Think about your favorite band, artist, entrepreneur or creative person on a social network and that’s what they’re doing. They have built or found a “scene”. Some of you may have been born into a scene already, or accumulated one through education or your career. As long as you can join or build a scene you can grow.
Each of us has some kind of potential “infinite game” we can invent and learn to play. We can build our “scenes”, our tribes and network of people, so that we know that we’re not alone and can keep moving ahead. And throughout it all, we must continue to learn -- and reinvent ourselves.
When I take a step back, relax, and focus on this, when I write these pieces and share what I can learn with you, it’s all part of my personal “infinite game”. You and my friend “@Fallible”* are all part of my new scene. We’re all going to face the future together.
(*More on that later - TBA)