Quarterly Counter Arguments

Last week I was explaining to my students the inverse relationship between bond prices (In secondary markets) and interest rates. I cited the failure of Silicon Valley Bank as an example of what can happen when interest rates increase rapidly. A student then asked the natural question:

“How did they (SVB) not see it coming? The interest rates weren’t going to be near 0 forever?”

My instinctive answer is just that people can be stupid, but that is clearly an oversimplification. Many people much more intelligent than I fail to see bubbles

Looking back, it is easy to identify millions of dollars spent on PNGs of Apes as an indicator of the impending pop.

In the moment I’m not sure about the extent to which I recognized the bubble. I don’t think I actually understood that there was a venture bubble until the first layoffs started at the company I was working at.

So how do we prevent this? The signs were clearly there. Perhaps the issue was that we weren’t looking for it?

What if I had forced myself to make the argument for a bubble? I would have been able to make a sound argument. If there was not a bubble I probably would not have been able to make a sound argument.

So perhaps every quarter I should force myself to make the argument for a bubble. What other things in my life will only become clear if I actively try to make the argument for them?

We’ll see if I stick to this, but I’m going to make the goal of writing a set counter arguments at the end of every quarter. Through the act of being the rigorous devil on my own shoulder, maybe I can be more confident in what I’m doing right, and correct what I am doing wrong.

Here is the list of prompts:

Make the argument that:

• My work is detrimental to society
• I will regret my strategies later on
• We are in an venture bubble and I am exposed to significant risk to it
• I am not growing
• The way I view the world is deeply flawed

Ideally if I fail to make a compelling case, that should mean that I am doing well in this category.