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The Chomp #67: Blood in the Streets

The Chomp
The Chomp #67: Blood in the Streets
By Cody McCauley  • Issue #67 • View online
Hey Everyone 👋 ,
Smash that mf like button if your portfolio also went off a cliff this week. It’s rough out there right now. But, it’s a great moment to take a step back and reflect on long-term fundamentals vs short-term growth, and hype vs conviction. That’s the overarching theme for this week as I try to do my best in staying grounded during this recent bout of market turmoil
With that, let’s dive into it.

🔗 Chum Bucket
Howard Marks’ most recent memo to Oaktree clients on the nature of when to sell
  • “Passive investing hasn’t grown to cover the majority of U.S. equity mutual fund capital because passive results have been so good; I think it’s because active management has been so bad.”
  • “The bottom line: 1) we should base our investment decisions on our estimates of each asset’s potential, 2) we shouldn’t sell just because the price has risen and the position has swelled, 3) there can be legitimate reasons to limit the size of the positions we hold, 4) but there’s no way to scientifically calculate what those limits should be. In other words, the decision to trim positions or to sell out entirely comes down to judgment … like everything else that matters in investing.
  • “No one at Oaktree believes they can make money or advance their career by selling now and buying back after an intervening decline, as opposed to holding for years and letting value lift prices if fundamental expectations prove out.”
Kyla’s fun take on the interconnectedness of the Federal Reserve, web3, and ‘market go down’ encompassing the macro narrative at large.
  • “The Federal Reserve and web3 are sort of doing the exact same thing. Of course, they are doing it differently, but the goal is somewhat the same. It’s narrative - convincing people of a Future Thing That Might Happen.”
  • “Like the Fed’s dual mandate, the mandate of web3 seems to be: Protect data: control over access and usage Own data: lack of a central authority, direct ownership Benefit from data: make money on things All of that is compounded by FOMO. web3 = [Protect * Own * Benefit]^FOMO”
  • “So this narrative of what web3 could be - which would probably be net-beneficial for most people - gets skewed because the narrative gets skewed. It could be perceived as an equitable, cooperative, and accessible world, but it isn’t. From an outsider’s perspective, the narrative is not being translated in the right way. Most people still see crypto as a get-rich-schema-for-already-really-rich-people, and that is not… appealing.”
Packy’s rebuttal to Scott Galloway’s damning, yet poorly contrived, post on web3
  • “It’s not about whether any particular platform is centralized, or who owns how much of what. It’s about the fact that the data is open, that builders and users have a choice, and that they’ll choose the platforms that extract less and give them more ownership.”
  • “Arguments around specific attributes of web3, or of any network, like centralization or the existence of bad actors, are beside the point, like arguing that the internet is bad because Facebook or 4chan exists. ”
  • “Outside of a handful of Bitcoin maximalists (who tend to hate on web3 anyway), there is not a single serious person in web3 or crypto or whatever you want to call it who doesn’t believe that it should be regulated, let alone who believes that regulation is heresy. Every founder and investor I’ve ever spoken to on the topic wants regulation in the US to come sooner so they can stop building and investing in ambiguity. ”
Cedric Chin’s perspective on why tacit knowledge is the most interesting topic in the domain of skill acquisition
  • “Tacit knowledge is knowledge that cannot be captured through words alone. In other words, tacit knowledge instruction happens through things like imitation, emulation, and apprenticeship. You learn by copying what the master does, blindly, until you internalize the principles behind the actions.”
  • “I realized that if you ever hear someone explaining things in terms of a long list of caveats, the odds are good that you’re looking at tacit knowledge in action.”
  • “The process of learning tacit knowledge looks something like the following: you find a master, you work under them for a few years, and you learn the ropes through emulation, feedback, and osmosis — not through deliberate practice.”
Ben Glove at Bankless breaks down Ethereum’s ‘Q4 report’
  • “Network Revenue rose 1,777% from $231.41 million to $4.34 billion. Network revenue refers to fees paid in ETH by users to transact on the network. Of this, $3.78 billion (87%) worth of ETH was “burned” and removed from the circulating supply through EIP-1559.”
  • “Network Revenue rose 1,777% from $231.41 million to $4.34 billion. Network revenue refers to fees paid in ETH by users to transact on the network. Of this, $3.78 billion (87%) worth of ETH was “burned” and removed from the circulating supply through EIP-1559.”
  • “Network Revenue rose 1,777% from $231.41 million to $4.34 billion. Network revenue refers to fees paid in ETH by users to transact on the network. Of this, $3.78 billion (87%) worth of ETH was “burned” and removed from the circulating supply through EIP-1559.”
🗓 Tweet of the Week
Dr. Parik Patel, BA, CFA, ACCA Esq. 💸
Peloton to start selling NFTs of bikes instead of real bikes to improve margins
🎵 Song of the Week
Reviver | Lane 8
📚 Books
💭 Parting Thoughts
“Dogs bark at what they cannot understand.”
— Heraclitus
If you found something that piqued your interest this week, please send it along to a friend.
Until next time. ✌️
This newsletter is created and authored by Cody McCauley and is published and provided for informational purposes only. The information in the newsletter solely constitutes Cody’s own opinions. None of the information contained in the newsletter constitutes—or should be construed as—investment advice.
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Cody McCauley

The Chomp is a roundup of the most interesting content I've read, along with occasional musings on technology and the world. You can expect to find a mix of sub-topics including web3, tech, investing, philosophy, and culture.

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