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Adam Robinson

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2018-12-11
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2018-12-11
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  1. “Right, right. And so, well, they're all and all the competitors are just essentially just using the stuff that we develop several decades ago. So I thought, how do I support myself? And I thought tutoring would be easy because I could tutor two or three students a day. This was my thinking. And then the rest of the time I would write my novel or my screenplay. This is what I thought. And so I wrote to every private high school in New York. And I remember at the time there were 31 because I had to type the same letter 31 times. And in the process of...”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  2. “In danger of failing, then you would get your parents would pay for a tutor, right? It wasn't for an edge, it was remedial.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  3. “Ah, well, we're switching gears here. So I went to Wharton undergrad, and then I got a law degree at Oxford, and I came to New York, and I thought that what I wanted to do was write novels and screenplays. That's what I thought. And I thought, well, if I do that, I'm going to have to support myself somehow because it's going to be years before, right? I can make a living as an author. And I knew if I went to Wall Street or worked in a law firm, I'd never find the time to write. I just get caught up in that world. So I thought, how can I support myself? Like I'm all at 25, right? And I thought, I know what I'll do. I'll tutor students. And I'm dating myself now. But back then, the only people getting tutored were people who were failing, right? Tutoring then wasn't what it is now because of what I did, right? But back then, it was just if you were in trouble, if you were floundering, like if you were.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  4. “I know of no other way. Now, you could argue, you could use statistics, but statistics aren't the expression of an idea. I'm interested in the expression of ideas because what I want to know is when are stock traders going to change their view on Facebook or change their view on the S&P 500 or metal traders are going to change their view on the price of gold? That's what I want to know because I can't trade a statistic. I can trade gold. I can trade Bitcoin. I can trade, you know, there are other things I can trade. I can't trade GDP. Good Why don't follow statistics?”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  5. “Exactly right, yeah. So when bond traders go to the left and stock traders go to the right, I know the bond traders are going to be right and early. So, I know sooner or later the equity traders are going to turn around and follow the bond traders.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  6. “Can't improve that, like, right? I mean, even if 10 out of 10, all your gut instincts were right at the end of the day, like you could have just been lucky, right? So you need a process that you can articulate and try to formalize and one that you can test, test everything. And I know you wanted to ask me questions about education and the Princeton Review and everything I did there. And that was everything had to be tested. So yeah. I know we haven't left investing yet, but you need a repeatable process and you need some objective way to measure does that process need to be tweaked.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  7. “Any process is right. That's what I meant. You're exactly right, of course. A process is something repeatable. It's something you could create an algorithm around, right? Maybe some discretion involved, but there should be some way to formalize it in rules. When this happens, I will do this, right? And so if you don't have a process, it's not something that can be improved, right? Our goal is always to improve ourselves. And if we don't, if we're not conscious of what we're doing, if we, as it were, kind of, if I said, Shane, why did you buy that stock? And you say, well, Adam, I just had a kind of gut feel about it. Well, that's not a repeatable process.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  8. “Yes, it's always right. And somebody else is wrong. Absolutely. Absolutely. And so you need an edge, right? Steve Cohen, one of the great traders of all time, said that was his favorite question. What's your edge? You need an edge and you need to know it. It's a good edge. You can't just say, well, my edge for investing in restaurant stocks is I worked in a restaurant one summer. Well, okay, that's not an edge. You need to, here's an edge, a definable process, right? Here's an edge.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  9. “Originat Right. And that's the way currency traders express their view. So if currency traders believe oil is going up, they will buy the Canadian dollar, right? Equity traders, what will equity traders do when they believe the price of oil is going higher? They will buy energy stocks and sell the S&P 500 as a hedge, right? And I will tell you that there's no consistent leader of those three. And I believe the reason for that is that oil is traded by the sovereign nations. So the sovereign nations that control the supply of oil also trade it, right? So you can be sure that when Russia or some other country decides to increase their supply of oil in the global markets, they're trading it. And you're taking the other side of the trade. So you've got to be”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  10. “Don't hold up. So that relationship copper divided by gold was pretty good in the 1990s and 1980s, but nowhere near it. It's batting a thousand since 2000. Interestingly, that's when emerging markets started to make their ascent in the global economy, right? China and the others. And so what I do is I look for these different groups to express strongly different views of the future. And then I assess probabilistically in the past who tends to be right when these groups disagree. Sometimes you can't tell. For example, the hardest commodity to predict is oil. Now there are three ways to predict the price of oil. There's the price of oil itself. Then there's your Canadian chain. The Canadian dollar is the best. The Canadian dollar versus the US dollar is the best foreign exchange. Expression of the price of oil of crude.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  11. “I'd have to check. The thing is, the world is so different now that it's when you go back into the 1990s, the problem is the world is very different. We have the emerging markets. We have the European Union, right? The world is just very different. So if you go back too far, the world was just different then.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  12. “That it's a probabilistic thing. I'm not saying go out and expect interest rates to plunge to one-year lows. I'm just telling you metal traders, fact. Metal traders have not been wrong once in the last 18 years about the direction of interest rates this century. Either to the upside or the downside, and they believe interest rates are headed lower.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  13. “Right. So August 2nd, and I will tell you that U.S. tenure yields are near one-year highs. They're roughly at 3%, 2.997, something like that, 3% U.S. 10-year yields. Copper divided by gold, which is the way metal traders express their view of interest rates, the price of copper divided by the price of gold, is pretty close to one-year lows. In fact, in the last 18 years this century, metal traders haven't been wrong once about the direction of interest rates either to the upside or the downside, and right now metal traders are firmly convinced that interest rates and by interest rates I mean U.S. tenure yields should be near one-year lows. They're not near one year highs. And I know that when metal traders and bond traders disagree about the direction of interest rates, the metal traders are right and early. Now, I'm not telling you.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  14. “And economists are literally always wrong. If you get a group of economists and they're in 100% consensus about the direction of interest rates, I'm going to take the other side of the trade for sure. And central bankers are worse than that. They rely on economists for their input. So yes, they have hundreds of variables, thousands that they look at, and they can't get anything right. For example, I'll tell you a divergence right now that I've been watching very carefully.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  15. “Well, huh, it's so funny. You would think if at least economists, and they're in sixth place, mind you, at least economists have the conviction of their economic model, their econometric model. At least they have that, even though their models are always wrong. Imagine I were a meteorologist, and every day you ask me, is it going to rain or be sunny? And I was consistently wrong. After a while, you'd say, Adam, maybe you should switch careers. And I go, yeah, but my model of weather patterns, it's so cool. And you'd go, yeah, but you're consistently wrong. You're always wrong.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  16. “There's always a trade he was glued to that, right? And he was a good trader, really good trader. So metal traders are the most far-sighted. They have the simplest model of the world. Actually, in touch with the world economy as opposed to economists. So I'm going to give you my Hall of Fame ranking of traders in third place are equity traders. In second place, bond traders, in first place metal traders. In fourth place oil traders, and in fifth currency traders. And below currency traders are economists. And below economists are central bankers who are not in touch with the environment or the economy at all and have complex multivariate calculus models of the economy and they can't predict interest rates. Something as simple as that.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  17. “Because if you want to take copper out of the earth, it's going to take years to open that mind, right? It's going to take a while to open the mind. And whereas currency traders, they're looking second to second. I knew a big name currency trader who had a, even when he went home, he had a monitor, computer monitor in every room in the house with currency prices, including the bathrooms. So even if he went into the bathroom,”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  18. “Why? Three reasons. The first is they are the forced gumps of the investing world. Their view of the world is very simplistic. Are people buying copper? And if they are, thumbs up, all's good in the world economy. Great. I guess interest rates are going higher. That's the way metal traders view the world. And if people are buying less copper, they go, oh, that's bad. Economic slowdown. So the first is their view of the world is very simple. Second, they're actually in touch with the world, right? People buy and sell copper. It's used. It's a thing. It's not like a number on a screen, which is all currency traders look at, right? And the third, so first simplicity of model. Second, it's something tangible. It's actually used in the world. And third is time frame. Metal traders look at least the commercial metal traders. They look months to years ahead.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  19. “Exactly right, a behavioral edge, and that's all that matters ultimately. I don't know what exists out there in the world. I have no view on the world. I am what's known as agnostic. I present no views of the world. But I will tell you how different asset classes view the world and which ones tend to be right and which ones tend to be wrong. So for example, when currency traders and equity traders disagree about the direction of currencies, the equity traders are going to be right on the currencies three times out of four. Not always. It's not like the bond trader edge. The most far-sided group of traders and accurate are the metal traders.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  20. “Capture the spread, right? And when those two disagree, I jump on opportunities when those two disagree because I know that the bond traders are right and early. So, for example, the ETFs for that, if people follow this, the best ETFs for that are LQD and IEF. So LQD is the investment grade corporate bond ETF and IEF is the US Treasury 10 year ETF. So you just take a ratio of that and follow that ratio and that'll tell you what bond traders think of the economy. And when they disagree seriously with equity traders, the bond traders are right and early.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  21. “So if I have a company, company X, there are two ways investors could express their view of that company. They could buy the stock, right? If they're bullish on that company, or they could buy the corporate bonds and sell treasuries against it. They'd have to do both”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  22. “Are all different ways different groups of traders express their view of the future? So suppose bond traders are pessimistic about the world, about the economy, right? They start selling corporate bonds and buying treasuries. So bond traders are pessimistic about the economy, and stock traders are optimistic. They're bidding up stock prices. I will tell you that nineteen times out of twenty, when those two groups disagree, the bond traders are right and early. They are right and early. And when I say nineteen times out of twenty, really I mean 99 times out of 100. If you want to find out when a stock is going to be in trouble, follow the corporate bonds of that company. Again, the corporate bonds relative to U.S. Treasury.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  23. “Two things if he's he or she is bullish on the economy he will buy corporate bonds and sell treasuries as a hedge How would a metal trader express his view of the future and he's bullish on the economy I know what he's gonna do He's gonna buy industrial metals right copper iron palladium right but he simultaneously going to sell precious metals because who needs gold or silver really or platinum if the economy is doing well So he simultaneously gonna sell those right buy copper, sell gold, right? These are all different ways that different groups of investors express their view of the future, their lens on the world, right? It's not to say that anyone is smarter than the others. In fact, when I tell you who the smartest group is, you'll see that that group is the smartest because they're the dumbest. And we're going to come back to that in a sec, right?”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  24. “Right. I'm going to tell you. Right. So, yeah, I'm revealing some secrets here. Yeah. Cool stuff. So listen up. So let's look at stock traders. If stock traders are bullish on the world, bullish on the economy, they think the economy is improving. They will express that view, right? That's all an investment is. The expression of a view of the future. Stockters will express that view by buying stocks, right? They can be more granular than that. They can buy cyclical stocks and maybe sell non-cyclicals as a hedge, but that's what they'll do, right? They'll buy stocks. What would a bond trader do who is bullish on the economy? He has exactly the same view as the stock trader today. How would he or she express that view? I will tell you. He will buy corporate bonds. But that exposes the bond trader to interest rate risk, right? So if interest rates rose, that bond investment would go down in value. So the bond trader will do.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  25. “Exactly right. They're all expressing views of the future. They're all studying the world, expressing a view of that world out there.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  26. “Well, it's, so let's look at the market, right? So the market, I'm using air quotes, comprises many individuals, different classes of traders. So you have stock traders and bond traders and currency traders, oil traders, oil energy traders, and metal traders, right? And that's pretty much it, stock traders, bond traders, currency traders, metal traders, and energy traders, right? Metal energy, currency, bond, and stock. There are other commodities out there like wheat and sugar, but those aren't really economic variables.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  27. “Same thing, but now parabolic, then you don't get the bounce back. And the third is something just go inside, doing nothing for a long period of time. And again, I'm using the doing nothing. I'm using air quotes because something very powerful is going on. It seems like it's doing nothing. But in fact, the stock or the asset is being the weak hands, those people who are bored and don't have patience are selling to people who have patience and have strong conviction.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  28. “It went to about six and then it bounced to, let me see, recently to 8,200. And I have a correlate for Bitcoin for the crypto coins. And the corlet is still flatlined. By correlate, I mean other ways of expressing the same view as Bitcoin. And again, I'm not offering investment advice, but there's no sign that it's woken up yet again. I'll come back to that, what a correlate is. Yeah.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  29. “Really take off. And again, just look at the price of Bitcoin, which went nowhere for years. And then all of a sudden it blipped up. It went up like, I don't know, from 10 to 100. Everyone went, what the heck was that about? And then you had this sleeping giant that took off from 10 to 100 to 19,000.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  30. “All of a sudden, right? So the third way prices change is a protracted period of nothing going on. In other words, a stock just moving sideways for months or years. And I'm using air quotes, nothing going on because something really strong is going on, something really powerful. And that is the stock is changing hands from people who get bored to people who are patient. That's what's going on there. So on the surface, it looks like, again, air quotes, nothing's happening. The stock price was 10. It's been 10 for the last year. Nothing's going on. Oh no, plenty has been going on, as it were, the weekends have been shaken out. Everyone who's bored with that stock is gone. The only people who have bought it are strong hands with strong conviction. So when that begins to take off, it's going to...”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  31. “Right. So parabolic means as opposed to a straight line, it starts to, it just goes exponential, right? Bitcoin, right? The crypto coins went parabolic after going nowhere for years.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  32. “And that's when the, so it doesn't matter any time frame. You need a long enough time period for people to form strong opinions about the continued direction of the trend. So months, maybe even years. And then all of a sudden, one day out of the blue, sharp decline. And you will always see that, always see that followed by a retracement. Because everyone else will go, that's oversold. That's a bargain. I'm going to buy that. The same thing works in reverse. The second way a price trend changes, you don't get a bounce back if the price has gone parabolic, right? Sometimes prices rise so sharply that no one expects them to keep rising at that rate. So the second way price trends change is you just get a sudden decline from a parabolic move.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  33. “Stock price in a stock price, you will see at first a sharp decline, and everyone else will go, that's ridiculous. And they'll bid it right back up. And then it's going to decline again. And that's when the far-sighted individuals come back and short it again.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  34. “Because the sharpened, the far sighted individuals, and we'll come back to who they are, it's not, by the way, there's a sort of a mythical group of people, the smart money, right? Doesn't exist. But I will show you how we can get to the same result. So stock declines sharply. Everyone else looks at the decline going, wow, that's oversold. It's a good bargain. It was $100 yesterday. Now it's only $85. Great. I can buy it. The far-setted individuals who are sitting on the sidelines now massively short the stock are only too happy to let that happen. And the stock price starts to climb back towards where it was before the sell off. And right before it gets back to a hundred, those far sighted individuals go great. Time to sell again. We got a good price to sell it, and that's when it begins in earnest. That's when the, again, it's the same Schopenhauer three stages.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  35. “Right, it shouldn't be down there. Yesterday it was 100. Today it's 85. That's oversold. Take a look at Facebook, right? Facebook dropped what? 19% in a day. You could say that's oversold and yet the price didn't bounce, interestingly, right? Here's an investment truth. I'm not offering investment advice, but think about a football player who's knocked down to the ground, American football. We expect the football player to get right back up. If he doesn't get up, it means he's injured or if he gets up slowly, it means he's injured. Same thing is true with a stock. If it gets knocked down, we expect it to bounce back. And if it doesn't bounce back, something's wrong. So to go back, the stock's been going up. They have a sudden sharp decline.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  36. “Right. Oversold means, well, again, oversold assumes that there's some true value where it ought to be And it should bounce back, right? Oversold means.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  37. “And we'll get to who those individuals are. So, what do those individuals knowing this do? I'll tell you what they do. They get out of their lungs and go massively short. So you will see a sudden drop in the price like an air pocket drop in the price of the stock. Now those far-sighted individuals, they've placed their bets. They now step aside, and everyone else looks at the price of the stock going, what the hell was that about? So they start to buy because it's, I'm using air quotes now, oversold.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  38. “Right, okay, the stock is just going up and to the right on a chart. Everyone will assume that it's going to keep going up in that direction, right? It's just going to continue, right? They'll extrapolate. They'll go, it's been going up for 10 years. It's going to keep going up. Right, certain far-sighted individuals, and we'll get to who they are in a sec. I'm going to reveal lots of secrets here. So certain far-sighted individuals will realize that that's not the future, that in fact, the stock is not going to be higher six months from now. It's going to be lower.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  39. “Applies to all trends, but you'll see it most clearly in financial markets. So if people can visualize the price of a stock going up for many years. Berkshire Hathaway. Well, I don't want to.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  40. “A new idea has formed in the marketplace, and this is a podcast, so I wish I could show charts, but I'm going to step through a way to spot trends as they're happening. There are only three ways a trend can start, and I'm going to describe all three. So this is the benefit of many, many years of studying markets. There are only three ways a trend can begin. The first is”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  41. “Is the early majority? They go, yeah, you know, there seems to be something to this new trend. I think I'm, yeah, I think I'm going to buy that stock too, or I'm going to buy that clothing line or whatever it is, or I'm going to go see that movie, right? Then the late majority and then the laggards. The philosopher Schopenhauer once said, all truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as self evident. And trends start like that, by the way.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  42. “Okay, that's funny. So the diffusion of innovation is a poorly named book because really the diffusion of innovation is the spread of ideas, right? Innovation in Roger's framework was an idea, a new idea, right? So what he meant by innovation wasn't technology. He just meant a new idea. So the diffusion of innovation was really a book on the spread of ideas. And so I'm sure you're familiar with the phrase early adopters that was coined by Everett Rogers in his book. So Everett Rogers said all ideas pass through the following stages. You have an innovator who comes up with an idea. And then you have early adopters who go, yeah, that's a good idea. Yeah, I agree with that. Now, most people aren't yet convinced. Most people need social proof. So the majority doesn't come in and the first part of the majority...”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  43. “Spread of an idea. So, one of the genius books written in investing, but it's not seen as an investment book, was written in 1962 by a guy named Everett Rogers, and the book is called The Diffusion of Innovation, right? You know that book, Shane? And so”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  44. “They love books like that. Good. Let's lots of people think that they can compete with us. Well, good luck, right? And it's an ecosystem and it's clear, it's a predatory ecosystem and not a nice one.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  45. “In a restaurant and think, I know everything there is to know about restaurants. That doesn't mean you're going to be a good investor of restaurant stocks, right? So I have concerns about how to books like that because they're inviting the public to compete with Wall Street. And by the way, Wall Street, that's how they make their money.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  46. “Right, that you walk into Starbucks and you see a long line and you go, Wow, Starbucks is, people are drinking a lot of Starbucks. I should buy Starbucks stock, right? Like, no, there are people who spend all their hours, all their time thinking about nothing but Starbucks stock or Facebook or Berkshire Hathaway or gold, whatever it is, and they're professionals. And investing is a gladiatorial pit. And if you think that you can compete with professionals at that game, well, good luck, you know, it reminds me of something Buffett once said. If you're in a poker game for 30 minutes and you don't know who the patsy is, you're the patsy. So the people who buy books like that, they are patsies for Wall Street. So you asked me earlier, what is your edge? You need to have an edge and you need to know what that edge is, right? And I don't care, by the way, you could be.”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  47. “Yeah, you know what? We have to be careful with that. Tim asked me exactly the same question and asked me about the same book. And I said, my problem with books like that, and Peter Lynch was a great investor, right? He ran Fidelity in the 1980s and 90s, like a legendary investor, a legendary investor who happened to invest during two of the biggest bull markets of all time. So maybe some luck was involved there. And the problem with a book like One Up on Wall Street is it tells the man and woman on the street, you can beat professionals at their game. Well, those professionals are there, they're 24-7 thinking about ways to take your lunch money, right? So my concern is that it gives a false sense of”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  48. “Raw milk or Facebook, a trend is merely the expression of an idea. So for example, buying Tesla stock could be the expression of an idea. The future of batteries wasn't”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  49. “and ask the assembled MBA students what is a trend they wouldn't be able to define it at all in fact i don't know that any investor in the world can define trend they can define it simplistically like this a trend is the continuation of a price series Yeah, well, that's great. What's causing the continuation, right? And I'll tell you what a trend is. This is an investment trend. Actually, it's true for all trends. A trend is the spread of an idea. That's all a trend is. It's the spread of an idea. And it doesn't matter whether the trend is gluten-free food or”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT

  50. “So I'm going to buy restaurant stocks, right? And you might get more granular than that. You might buy McDonald's versus some higher price point restaurant chain, right? But nonetheless, that's what you're attempting to do. So all markets are is the means by which people express views of the future. Now, I'm going to share one of my favorite investment books of all time, and it's not an investment book. If you and I were to go to Columbia Business School or Harvard Business School right now,”

    2018-12-11 · The Knowledge Project with Shane Parrish · #47 Adam Robinson: Winning at the Great Game (Part 1) · IDENTIFIED FROM THE TRANSCRIPT