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Excerpts

On Trading,Balls and Brains

There’s a trading culture out there that encourages risk-taking. A lot of this culture is tied up with the culture of masculinity. To be willing to take big risks is to have “balls”. Taleb himself has encouraged this idea, writing that “Those with brains but no balls often become mathematicians; those with balls but not brains join the mafia; and those with no brains and no balls become economists.” When asked who has “both brains and balls”, he replied that it was “traders”.
Sadly, this culture of testosterone-fueled risk-taking overconfidence is terrible for the average investor, as Brad Barber and Terry Odean have documented. Balls interfere with brains. They make you you believe you have better information than you have – in other words, they make you ignore risks. That’s probably why women, on average, make better traders than men. (And overconfidence is only exacerbated if, out of testosterone-fueled aggression, you angrily defend every single trade you ever made.)-from NoahOpinion
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Image

No matter how great the talent

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Tweets

A retort to Imran Khan

Here is what Imran Khan tweeted:

 

And below is the great retort:

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Excerpts

Indian IT CEOs are shuffling decks on the Titanic

Now I am ready to declare the end of the line for Indian IT. There are new $100 billion opportunities that could revitalize this industry. But from what I’ve seen, Indian executives seem incapable of steering their ships in the right directions.

It is not that Indian outsourcers have become less capable of servicing Western needs. It is that their customer base—the CIO and IT department—is in decline. With the advent of tablets, apps, and cloud computing, users have direct access to better technology than their IT departments can provide them. They can download cheap, elegant, and powerful apps on their IPads that make their corporate systems look primitive. These modern-day apps don’t require internal teams of people doing software development and maintenance—they are user-customizable and can be built by anyone with basic programming skills.

It takes decades to update legacy computer systems, and corporate IT departments move at the speed of molasses. So, Indian outsourcers have a few more years before they suffer a significant decline. They certainly won’t see the growth and billion-dollar outsourcing deals that have brought them this far.

The same advances that are changing the IT landscape are also creating new opportunities.

For example, advances in robotics, artificial intelligence (AI), and 3D printing are making it cost effective to move manufacturing back from China to the U.S., Europe, …and India.

Take the Baxter robot from Rethink Robotics. It has two arms, a face that displays simulated emotion, and cameras and sensors that detect the motion of human beings that work next to it. It can perform assembly and move boxes—just as humans do. It will work 24 hours a day and not complain. It costs only $22,000. This is one of many such robots

A type of manufacturing called “additive manufacturing” is making it possible to cost-effectively “print” products. 3D printers can create physical mechanical devices, medical implants, jewelry, and even clothing. The cheapest 3D printers, which print rudimentary objects, currently sell for between $500 and $1000. Soon we will have printers for this price that can print toys and household goods. By the end of this decade, we will see 3D printers doing the small-scale production of previously labor-intensive crafts and goods. In the next decade we may be 3D-printing buildings and electronics.

In my discussions with Indian CEOs, they all acknowledge the reality. They are becoming aware of what lies ahead. I have implored them to start retraining their people in the new technologies and to develop new businesses and consulting practices. They listen, nod their heads from side to side, and go back to trying to close the disappearing software-outsourcing deals. I tell them that they are shuffling deck chairs on the Titanic.-wrote Vivek Wadhwa,Fellow at Stanford University

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Links

Linkfest:Jan 09,2014

Some stuff I am reading today morning:

Kishore Biyani is the most successful PE investor of 2013 (ET)

All eyes on LIC again (FE)

Facebook makes it’s first Indian acquisition (BS)

Retail investors should stay put in liquid funds (ET)

Tax Saving Fixed Deposits (BeMoneyAware)

Abolishing taxes (AjayShah)

10 reasons the Gold Bugs lost their shirts (Bloomberg)

India hits US where it hurts:In the Club (WSJ)

The slow march to ruin (BillBonner)

The story of Geico,Graham and Buffett (ValueWalk)