A grown man made a wager. He lost. He made another wager. He lost again. End of story.
– Tony Soprano
This is the story of weak men and rapacious men.
This is the story of Bed Bath & Beyond.
This is the story of America today.
Recent major media stories that feel to us like they’re part of a larger narrative campaign.
Recent major media stories that feel to us like they’re part of a larger narrative campaign.
Recent major media stories that feel to us like they’re part of a larger narrative campaign.
Recent major media stories that feel to us like they’re part of a larger narrative campaign.
Recent major media stories that feel to us like they’re part of a larger narrative campaign.
City of God / City of Man
An AI in the City of God
The City of Man always wins.
The Visigoths always sack Rome. The Vandals always sack Hippo. Augustine always dies in the siege. Bad things always happen to good people … at scale.
Here’s how we use generative AI to flip the script.
Men of God in the City of Man, Part 1: Virus
This is a story about a virus and the gain-of-function research that produced it.
It’s not what you think.
Men of God in the City of Man, Part 2: Carriers
Every virus needs carriers to spread. Even a narrative virus.
We can learn a lot from what they have in common.
Men of God in the City of Man, Part 3: Memetics
In the same way that genetics governs how physical viruses reproduce within a host, memetics governs how narrative viruses reproduce within a culture.
And the memes which govern our narrative virus are powerful.
Men of God in the City of Man, Part 4: Epimemetics
Every narrative is built on memes that have evolved and adapted to human culture over centuries.
But some environments change the way that those memes are expressed. The effects can be explosive.
Men of God in the City of Man, Pt. 5: Epidemic
Men of God prophesied as early as 2007 that God would make Donald Trump the President of the United States.
Our narrative virus gave these predictions fertile ground to take root.
Men of God in the City of Man, Pt. 6: Pandemic
Surprising outcomes in reality world that seem to confirm a narrative often produce explosive growth in its scale.
But also in its scope.
Men of God in the City of Man, Pt. 7: Mutation
Narrative viruses are not immune to events in reality world – especially when we have made those narratives part of our identity.
And when a narrative becomes part of our identity, it changes what we need to be true.
Men of God in the City of Man, Part 8: Zoonosis
Physical viruses sometimes jump from one species to another.
Narrative viruses sometimes jump from one culture to another.
All it takes is the right virus and a susceptible host.
Recent Notes
Hodor
The Story of Adequate Liquidity doesn’t exist and shift on the margin. Instead, it exists in two states: it is normal, or it is broken. Once the threshold between these states is crossed, it is very hard to tell the old story. Sometimes impossible.
There is almost no price too high to keep that story from jumping over that threshold.
Epsilon Theory 2022 in Review – Foundation
2022 was our ninth year of publishing Epsilon Theory. It was also our best.
We’re changing the way the world sees the invisible water in which we swim – narratives.
And we’re just getting started.
Covid is China’s Vietnam War
Covid is China’s Vietnam War, and the current outbreak is their Tet Offensive.
This is how common knowledge changes, as now everyone knows that everyone knows that the CCP is not just a liar, but an incompetent, failed liar.
The Recipe for Agent Orange – The Projection Racket, Pt. 3
There is a true story of free market capitalism. It is one of humanity’s greatest and most important stories.
There is also a myth of free market capitalism. It is one of humanity’s most manipulated stories.
The MacGuffin, Part 2: The Story Arc of SBF and FTX
The MacGuffin is the object of desire.
It is the thing around which the plot of the story revolves.
Here is the story arc of SBF and FTX, and the MacGuffin that anchored it all – the Magical Money Machine.
Stock Buybacks!™ and the Monetization of Stock-Based Compensation
I love stock buybacks, but I despise Stock Buybacks!™ – the issuance of new shares to management with one hand and the buying back of those shares with the other.
Over the past decade, Stock Buybacks!™ have transferred more than a trillion dollars from shareholders to managers. Not founders, not entrepreneurs, not risk-takers … managers.
Cursed Knowledge #15: Sir Edmund Hillary Thinks You’re An Ass
Mt Everest is a death trap. Everything about the mountain is designed to kill you. So why are so many people going up there? Why do we ignore the very real and very dangerous narratives that are right in our face.
UK Pensions Webinar Recording
This is the recording of our webinar on UK Pensions that took place on October 14th, 2022. If you want to continue the conversation, check out the ET Forum.
A Brief History of the Past 10,000 Years of Monetary Policy
What we saw happen in the UK last week is the first shock, not the last, and all the massive pension funds and asset owners who have turned themselves into shadow hedge funds, full of swaps and leverage through the sweet whispers of Wall Street Wormtongue, will be our undoing.
Cursed Knowledge #14: In Defense of Marie Antoinette
Marie Antoinette has a rather interesting historical footprint. For all that her image is iconic and her reputation infamous, it’s not all the truth. The real Marie Antoinette has been lost to the cartoon of Marie Antoinette™. So I want to show you a glimpse at the real person behind the cartoon and take a closer look at how her cartoon got started.
Monetary Policy is Non-Linear
The relationship between interest rates and inflation is non-linear and non-monotonic, and in exactly the same way that the Fed was unable to spur inflation by cutting rates to exceptionally low levels, so will they be unable to contain inflation by hiking rates off these exceptionally low levels.
The Fed first has to get interest rates to this monotonic tipping point before further interest rate hikes will have any appreciable effect in the real economy.
Cursed Knowledge #13: Subverting Censorship
The Golden Age of Hollywood was full of drama. On and off screen. It was the age of carefully cultivated images. Fake names and secret procedures. And it was the age of censorship. The Hays Code and the censorship office had more influence on the film industry than any actor, director, or producer ever could. They had full control over what Hollywood made. Well, almost. There were still a few loopholes left to exploit.
The Widening Gyre
The widening gyre is eating America alive. It is the instrument of the Beast, a three-headed hydra of Big Politics, Big Media and Big Tech.
A third political party can be our weapon to slay the Beast, but not in the way you think.
Why the Yankees Sucked in August
“The laws of probability, so true in general, so fallacious in particular.”
That was Edward Gibbon in 1774. This is ET contributor Brent Donnelly saying the same thing but in a much more entertaining way in 2022.
Government Sponsorship and the Student Loan Crisis
US student debt is no longer ordinary debt, but has morphed into a bizarre government tax-and-spend model.
Sauron Remains Undefeated
The US Treasury is the Eye of Sauron — a gigantic panopticon tower that sweeps the world with its unblinking gaze, seeking out the owners of power, i.e. money.
What Treasury did to Tornado Cash and its developers is just the beginning.
Cursed Knowledge #12: Resurrectionists
What’s in a name? Quite a bit actually. Names and titles can be all that’s needed to make some one a hero or a villain. So we’re looking at some villains who never got their proper title. People who were able to hide behind social standing and wealth to excuse their crimes.
Narrative and Metaverse, Pt. 4 – Carrying the Fire
This is how we resist the Long Now, how we find an alternative world to the endless present where the Party is always right. By connecting the human past to the human present to the human future. By carrying the fire of our own stories in our own words across the weave of time and space. By building an ark and an arc.
This is my faith.
Before You Fly The Nest: Advice for kids heading to college
ET contributor Brent Donnelly went out and asked some people he respects what advice they would give kids heading off to college. Here’s what he found.
The Most Important Sector in the Universe
The total value of the Chinese residential property sector is approximately $60 trillion – twice the size of the US residential market and bigger than the entire US bond market. Bigger than the entire US stock market, too.
It is … ummm … having a moment.