Warriors
w.263 | Dividend Recaps, Lutkin, Bessent, Consumer Trends, Tyler Cowen, & Beautiful vs Practical
Dear Friends,
I’ve been in Barcelona this week as a supportive spouse. I wish that I could share my takeaways from slithering around, but I’ll only say that running a professional services firm at a senior level is hard. You have three full-time jobs: manage your own business operations, be front-line and full-stack sales (i.e., earn work), and then deliver said work at an outstanding level (if you want to charge a premium).
While the seafood here has been generally excellent, I encountered a bad mollusk but have fully recovered. It’s worth remembering that these creatures are often called “the liver of the river,” as they filter out pollutants and harmful algae from bodies of water. Perhaps a bit more caution for me in the future.
And, since it’s March Madness and we have a lot of Duke fans in this newsletter, I recommend re-watching Grant Hill break down the leadership lessons from Coach K regarding “The Shot” at the 1992 Elite Eight.
Today's Contents:
Sensible Investing
Song of the Week: Warriors
Sensible Investing
Smart Alpha vs Beta in VC. Solid piece. Many have said something similar in a different way.
Howard Lutkin (Secretary of Commerce) on All In Podcast and Scott Bessent (Secretary of Treasury) on All In Podcast. They both are doing a good job explaining what happened from an economic history point of view, and there is an elegance to the commentary about how we have subsidized the rest of the world by not having tariffs while others did. They are soft-peddling, and they know there will be a short-term contraction. They also imply but don’t say directly that we (Americans) consume too much stuff.
Which gets us to…
2025 Annual Consumer Trend Report by Forerunner. 200 pages of charts with nothing surprising. There is a lot of focus on ‘wellness’ and AI providing relief & delight (used to be pain pill vs vitamin) and ‘doing it for me’ & ‘doing it with me’, which begin to blur together.
Consumers are financially stretched, the economy is a top priority, and everyone hates inflation. This is a tale as old as time, but maybe about to get more acute.
Private Equity Firms Are Getting Rid of Their Equity. PDF’ed from Bloomberg. It’s about the trend of PE firms use dividend recaps from private credit firms to achieve liquidity.
From Matt Levine: “One way to jointly describe these facts might be “there is high demand for risky debt and lower demand for risky equity.” Or as Steve Schwarzman — the founder of a private equity firm that is increasingly a private credit firm — once put it: “If you can earn 12 percent, maybe 13 percent on a really good day in senior secured bank debt, what else do you want to do in life?”
Tyler Cowen, The Man Who Wants to Know Everything (PDF from The Economist). He is Silicon Valley’s favorite economist. Does his lust for knowledge have a place in the age of AI? H/T to Billings for sending.
One of my friends said Tyler talks like an oracle.
He told me that in San Francisco tech circles, he was perceived as being “the best” at the precise thing he did—arranging, absorbing, and curating vast quantities of information.
Beautiful vs. Practical Advice. Another great one from Morgan Housel.
Song of the Week: Warriors
Here on YouTube.
Too Many Zooz is essentially the creator of "brasshouse." It's a combination of jazz, house, hip-hop, and more all thrown together in a way that is both danceable and invigorating. The band will often step away from traditional instruments to use various tools for sound whether they are on the streets performing or in the studio.
Warriors is their breakout hit. The band started off playing on NYC’s streets and subways. They were discovered online and ended up working with Beyonce on her Lemonade album.
Fun story. Great tune.
“Warriors“ by Too Many Zooz
InstrumentalSelfie of the Week
I went to the Moco museum in Barcelona this week. Easy to walk through, the highlight was the immersive features, like this one.
Thanks for reading, friends. Please always be in touch.
As always,
Katelyn