On The Most Important Thing

I recently finished reading The Most Important Thing – Uncommon Sense for the Thoughtful Investor – by Howard Marks.

Below are key excerpts from the book that I found particularly insightful:

Few people have what it takes to be a great investors. Some can be taught, but not everyone… and those who can be taught can’t be taught everything. Valid approaches work some of the time but not all. And investing can’t be reduced to an algorithm and turned over to a computer. Even the best investors don’t get it right every time.

Because investing is at least as much art as it is science, it’s never my goal—in this book or elsewhere—to suggest it can be routinized. In fact. one of the things I most want to emphasize is how essential it is that one’s investment approach be intuitive and adaptive rather than be fixed and mechanistic.

Second-level thinking is deep, complex and convoluted. The second level thinker takes a great many things into account: What is the range of likely future outcomes? Which outcome do I think will occur? What’s the probability I’m right? What does the consensus think? How does my expectation differ from the consensus? How does the current price for the asset comport with the consensus view of the future, and with mine? Is the consensus psychology that’s incorporated in the price too bullish or bearish? What will happen to the asset’s price if the consensus turns out to be right, and what if I’m right?

Return alone—and especially return over short periods of time—says very little about the quality of investment decisions. Return has to be evaluated relative to the amount of risk taken to achieve it. And yet, risk cannot be measured. Certainly it cannot be gauged on the basis of what “everybody” says at a moment in time. Risk can be judged only by sophisticated, experienced second-level thinkers.

The road to long-term investment success runs through risk control more than through aggressiveness. Over a full career, most investors’ results will be determined more by how many losers they have, and how bad they are, than by the greatness of their winners. Skillful risk control is the mark of the superior investor.

The pendulum swing regarding attitudes toward risk is one of the most powerful of all. In fact, I’ve recently boiled down the main risks in investing to two: the risk of losing money and the risk of missing opportunity. It’s possible to largely eliminate either one, but not both. In an ideal world, investors would balance these two concerns. But from time to time, at the extremes of the pendulum’s swing, one or the other predominates.

What weapons might you marshal on your side to increase your odds? Here are the ones that work for Oaktree: a strongly held sense of intrinsic value. insistence on acting as you should when price diverges from value. • enough conversance with past cycles—gained at first from reading and talking to veteran investors, and later through experience—to know that market excesses are ultimately punished, not rewarded. a thorough understanding of the insidious effect of psychology on the investing process at market extremes. a promise to remember that when things seem “too good to be true,” they usually are. willingness to look wrong while the market goes from misvalued to more misvalued (as it invariably will), and • like-minded friends and colleagues from whom to gain support (and for you to support).

To boil it all down to just one sentence, I’d say the necessary condition for the existence of bargains is that perception has to be considerably worse than reality. That means the best opportunities are usually found among things most others won’t do. After all, if everyone feels good about something and is glad to join in, it won’t be bargain-priced.

What We Learn from a Crisis—or Ought To: Too much capital availability makes money flow to the wrong places…When capital goes where it shouldn’t, bad things happen…hen capital is in oversupply, investors compete for deals by accepting low returns and a slender margin for error…Widespread disregard for risk creates great risk…Inadequate due diligence leads to investment losses…In heady times, capital is devoted to innovative investments, many of which fail the test of time…Hidden fault lines running through portfolios can make the prices of seemingly unrelated assets move in tandem…Psychological and technical factors can swamp fundamentals…Markets change, invalidating models…Leverage magnifies outcomes but doesn’t add value…Excesses correct.

On a closing note:

Thus, it’s our goal to do as well as the market when it does well and better than the market when it does poorly. At first blush that may sound like a modest goal, but it’s really quite ambitious.

A must read in the area of investing.

On Complications

I recently finished reading Complications – A Surgeon’s Notes on an Imperfect Science – by Atul Gawande.

Below are key excerpts from this book that I found particularly insightful:

The thing that still startles me is how fundamentally human an endeavor it is. Usually, when we think about medicine and its remarkable abilities, what comes to mind is the science and all it has given us to fight sickness and misery: the tests, the machines, the drugs, the procedures. And without question, these are at the center of virtually everything medicine achieves. But we rarely see how it all actually works. You have a cough that won’t go away—and then? It’s not science you call upon but a doctor. A doctor with good days and bad days. A doctor with a weird laugh and a bad haircut. A doctor with three other patients to see and, inevitably, gaps in what he knows and skills he’s still trying to learn.

I am a surgical resident, very nearly at the end of my eight years of training in general surgery, and this book arises from the intensity of that experience…But more than anything, this book comes from what I have encountered and witnessed in the day-to-day caring of people…The book’s title, Complications, comes not just from the unexpected turns that can result in medicine but also, and more fundamentally, from my concern with the larger uncertainties and dilemmas that underlie what we do. This is the medicine that one cannot find explained in textbooks but that has puzzled me, sometimes troubled me, sometimes amazed me, as I’ve joined the profession’s ranks.

There is a saying about surgeons, meant as a reproof: “Sometimes wrong; never in doubt.” But this seemed to me their strength. Every day, surgeons are faced with uncertainties. Information is inadequate; the science is ambiguous; one’s knowledge and abilities are never perfect. Even with the simplest operation, it cannot be taken for granted that a patient will come through better off—or even alive.

In surgery, as in anything else, skill and confidence are learned through experience – haltingly and humiliatingly. Like the tennis player and the oboist and the guy who fixes hard drives, we need practice to get good at what we do. There is one difference in medicine, though: it is people we practice upon.

This is the uncomfortable truth about teaching. By traditional ethics and public insistence (not to mention court rulings), a patient’s right to the best care possible must trump the objective of training novices. We want perfection without practice.Yet everyone is harmed if no one is trained for the future. So learning is hidden, behind drapes and anesthesia and the elisions of language. Nor does the dilemma apply just to residents, physicians in training.

With repetition, a lot of mental functioning becomes automatic and effortless, as when you drive a car to work. Novel situations, however, usually require conscious thought and “workaround” solutions, which are slower to develop, more difficult to execute, and more prone to error. A surgeon for whom most situations have automatic solutions has a significant advantage.

The British psychologist James Reason argues, in his book Human Error, that our propensity for certain types of error is the price we pay for the brain’s remarkable ability to think and act intuitively—to sift quickly through the sensory information that constantly bombards us without wasting time trying to work through every situation anew. Thus systems that rely on human perfection present what Reason calls “latent errors”-errors waiting to happen.

This sort of burnout is surprisingly common. Doctors are supposed to be tougher, steadier, better able to handle pressure than most. (Don’t the rigors of medical training weed out the weak ones?) But the evidence suggests otherwise. Studies s show, for example, that alcoholism is no less common among doctors than among other people. Doctors are more likely to become addicted to prescription narcotics and tranquilizers, presumably because we have such easy access to them.

In the end, it is sometimes not science but what people tell us that is the most convincing proof we have.

In recent years, we in medicine have discovered how discouragingly often we turn out to do wrong by patients. For one thing, where the knowledge of what the right thing to do exists, we still too frequently fail to do it. Plain old mistakes of execution are not uncommon, and we have only begun to recognize the systemic frailties. technological faults, and human inadequacies that cause them, let alone how to reduce them. Furthermore, important knowledge simply not made its way far enough into practice.

In the absence of algorithms and evidence about what to do, you learn in medicine to make decisions by feel. You count on experience and judgment. And it is hard not to be troubled by this.

It is because intuition sometimes succeeds that we don’t know what to do with it. Such successes are not quite the result of logical thinking. But they are not the result of mere luck, either.

A highly recommended read in the areas of medicine and decision making.

On Story Engineering

I recently finished reading Story Engineering – Mastering The 6 Core Competencies of Successful Writing by Larry Brooks.

Below are key excerpts from the book that I found to be particularly insightful:

Here then, at the most introductory level of definition, and in no particular order, are the Six Core Competencies of Successful Storytelling: 1. CONCEPT—The idea or seed that evolves into a platform for a story. Best and most empowering when expressed as a “what if?” question. The answer leads to further “what if?” questions in a branching and descending hierarchy. and the collective whole of those choices and answers becomes your story. 2. CHARACTER—Don’t leave home without one. Every story needs a hero. We don’t need to like him (contrary to what your high school composition teacher told you), but we do need to root for him. 3. THEME—Yes, it’s like putting smoke into a bottle, but it can be done. Not to be confused with concept, theme is what your story is illuminating about real life. 4. STRUCTURE—What comes first, what comes next, and so forth and why. And no, you can’t just make it up for yourself. There are expectations and standards here. Knowing what they are is the first step toward getting published. 5. SCENE EXECUTION—You can know the game, but if you can’t play it well you can’t win. A story is a series of scenes with some connective tissue in place. And there are principles and guidelines to make them work. 6. WRITING VOICE-The coat of paint, or if you prefer, the suit of clothes, that delivers the story to the reader. The biggest risk here is letting your writing voice get in the way. Less is more. Sparingly clever or sparsely eloquent is even better.

A concept, it could be said—and it should be viewed this way—is something that asks a question. The answer to the question is your story.

Knowing the narrative goal in your storytelling is everything. It is the most powerful gift you can bestow upon your story, and yourself. Your concept clearly and compellingly stated, is the first step in your journey toward knowing and then pursuing that goal.

The Seven Key Characterization Variables Surface affectations and personality, Backstory, Character arc, Inner demons and conflicts, Worldview, Goals and motivations, Decisions, actions, and behaviors.

In the first dimension of character (which includes the list above). what you show the reader about your character simply exists. You leave it to the reader to assign meaning…In the second dimension of character, the reader learns the reason for choices and behaviors that define outward perception, or the effort to control it, which may or may not align with any meaning the reader has assigned to it on her own. In the third dimension of character, all of the choices made at the first-dimension level become subordinated to more important choices and behaviors made when greater weight and consequences are at stake.

To put it in its most simple terms, theme is what our story means. How it relates to reality and life in general. What it says about life and the infinite roster of issues, facets, challenges, and experiences it presents. Theme can be a broad topical arena, or it can be a specific stance on anything human beings experience in life.

 

These aren’t words as much as they are realms…dimensions…essences fundamental qualities. Compelling: Will anyone care about your story?…Hero: Yeah, you know you need a protagonist, blah blah blah. But is your lead character actually heroic? In what way?…Conflict: Nobody wants to read about a walk in the park. Really, they don’t. What opposes your hero’s quest?…Context: The most overlooked and taken-for-granted nuance in storytelling. What is the contextual subtext at any given moment in your story?…Architecture: That sound you hear is me once again beating this drum. Does your story unfold with a proper setup?…Resolution: Does the end of your story deliver an emotional payload to the reader? Does it make sense?

On a closing note:

You are a writer. And now, you are an enlightened writer. Take a moment to celebrate that fact. And then get back to work. The rest is out of your hands. The inner reward is the gift of life itself. Writers are scribes of the human experience. To write about life we must see it and feel it, and in a way that eludes most. We are not better people in any way—read the biographies of great writers and this becomes crystal clear—but we are alive in a way that others are not. We are all about meaning. About subtext. We notice what others don’t. If the purpose of the human experience is to immerse ourselves in growth and enlightenment, moving closer and closer to whatever spiritual truth you seek-hopefully have a few laughs and a few tears along the way—wearing the nametag of a writer makes that experience more vivid. We’re hands-on with life, and in the process of committing our observations to the page we add value to it for others…So, go out there and write with passion and insight. But always write with pleasure and fulfillment in the knowledge that you matter. And whatever your writing dream, keep the Six Core Competencies close at all times. They will set you free of the self-imposed limits others suffer. The ceiling is gone, vanished forever. Live the dream. Write your story. Then become one.

A recommended read in the areas of writing and storytelling.

On The Making of the President 1972

I recently finished reading The Making of the President 1972 – A narrative of American politics in action – by Theodore H. White.

Below are key excerpts from this book that I found to be particularly insightful:

He recognized best, and spoke most clearly, for how Americans chose to live at home in their neighborhoods-or, at the very least, he persuaded an astounding majority of Americans that he understood their emotions and needs better than his rival. With his victory, he believed in all sincerity that he had been given a mandate to reorganize the American government to make it more responsive to what the voters had shown they wanted. The after-fact that this genuine mandate might be denied him by Watergate, by the frightening way he had let his own appointees use his purposes to flout law—that is a story this book will inescapably, later, come to. But the book begins with how the people saw their leaders, and how the leaders saw then: people, in America in1972, when the and how;he leaders saw then: people, in America m 1972, when the postwar world was coming to an end—and how the people chose Richard Nixon.

Roosevelt had come of the patricians and rarely soiled himself with the nitty-gritty of mechanical politics. Roosevelt campaigned in another time, almost m another country. Large of vision, buoyant of spirit, steeped in history by family and blood, the lordly Roosevelt left it to his lieutenants to deal with the wards, the townships and regional power brokers, then pasted up his electoral votes, as he did the stamps his dealers brought him, in his album. It was quite clear always to Roosevelt what he was dealing with and what he had to do—and he did it easily.

The world of the 1960’s-which the liberals had dominated m America-was changing so rapidly that by the beginning of the 1970’s America—was changing so rapidly that by the beginning of the 1970’s change had created a climate of schizophrenia in liberal thinking, almost a civil war among thinkers who came of the same tradition. Always, since the time of Washington and Jefferson, three great permanent issues have dominated American politics-foreign policy; the clash of the races; and the managing of the economy. In the 1960’s, however, a liberal administration had accepted the war in Vietnam – and its unfurling had then split liberals from top to bottom. Liberals had championed the Black Revolution—and been unable to cope with its results. Liberals had masterminded the great boom of the 1960’s—and not foreseen its effect on manners and morals.

Well, Mr. Nixon liked Andrew Jackson—Jackson took on the banks. He liked Lincoln—Lincoln took on slavery and the cause of the Union. He liked Grover Cleveland—Cleveland took on the Congress, and restored the power of the Presidency which had been lost by Andrew Johnson. And Teddy Roosevelt—he had taken on the trusts and vested interests. And Wilson—Wilson took on the Senate and the isolationists. And Franklin Roosevelt. The common denominator, said the President, was that they accepted controversy and they made things move, they wanted progress. “There’s a role in life for men like McKinley, good men,” said the President. But he. Nixon, didn’t want to be like McKinley, nor like Eisenhower. He wanted to be a leader.

Statistics had once been a clearly marked area of scholarship, where economists, sociologists and planners held intellectual squatter’s rights. Now the numbers were a new staple of journalism. The Bloody Thursday figures fitted into the middle pages of the newspapers, as did the numbers on traffic, schools and tobacco use. But the high-impact figures —unemployment, prices, crime—were front-page news everywhere, as well as natural stories for the television evening news. Slowly, one tried to explore the numbers, for they had become the fashionable way for politicians to demonstrate a grip on reality. And one learned that there are real numbers and phony numbers.

Each decade in American life has a Sacred Issue to which all politicians must pay lip service. In the 1950’s, the Sacred Issue had been Defense and Anti-Communism. In the 1970’s, it seems certain that it will be the cause of Environment. In the 1960’s, however, the Sacred Issue was Education-and the Census of 1970, reporting on youth, Issue was Education—and the Census of 1970, reporting on youth, measured the mania for education which had swept American society in the previous decade.

One could best explain the nature of this struggle in 1972 by making an imaginary diagram of the American power structure at the tum of the century and comparing it to the American power structure as the postwar world came to its end. In 1900, as William McKinley prepared for his second term, the American power structure could be described in pure Leninese. At the pinnacle of power was Wall Street-finance. Wall Street centralized American national action—it decided where mines would be opened, railways built, what immigrant labor should be imported, what tech-railways built, what immigrant labor should be imported, what technology developed. it immigrant labor should be imported, what tech-discussion. At a second level was the Congress of the United States—doing the will of the great financiers, enacting the necessary laws, repelling the raiders of prairie discontent. On a third level was the series of largely undistinguished men who until 1900 had held the figurehead office of President of the United States for thirty years; their chief power, beyond the expression of patriotic piety, was to deploy a minuscule professional army and navy against Indians and Spaniards. The American clergy exercised some moral power, best expressed in such issues of national political importance as temperance. Behind came all the other power ingredients—a decorative Supreme Court, the early labor unions, the corrupt big-city machines, the universities. Then the proprietary press—for the press was then a proprietorship, something owned by businessmen for making money. By 1972 the power structure had entirely changed. The most important fall from power had happened to finance; businessmen might get fat, as they still did in 1972, by wheedling subsidies from national or state governments, but they were now a lobby that came hat-in-hand before a legislature and executive to whom once they had dictated. Labor, big labor, had risen to almost equal political power. The clergy had declined in power even more than big business. Congress, too, was a major loser in the power game—seventy years of domination by vigorous, aggressive Presidents had reduced its self-respect and, even more critically, the respect of the public. The Supreme Court had reached a peak of control over the national agenda m the 1960’s; but its power was beginning to fade again as the seventies began. Universities were among the big gainers in the power hierarchy—universities now were among the big gainers in the power hierarchy —universities now But the two greatest gainers in the reorganized power structure were the Executive President and his adversary press, or, as one should more properly phrase it in modem America, the “press-television complex.” Both tried to operate under what they considered traditional rules, but American life had made that impossible.

The story of Watergate was only one of a number of major stories in the election of 1972. As it unraveled, it was to become a story of 1973 and would fit better, someday when all was known, into a story of the use and abuse of power in a modem state. The elections of 1972 were determined, basically, by the record Richard Nixon had written in the understanding of his people—and his chief adversary was not in the understanding of his people—and his chief adversary was not understood and spoke for the people better than he did himself. On this immediate level of contest, Richard Nixon won. The people preferred Richard Nixon.

The Watergate affair is inexplicable m terms of older forms of corruption in American history, where men broke laws for private gain or privilege. The dynamics of its irrationality are compounded further by stupidity. The men involved were involved at a moment, in 1972, when history was moving their way. They were trying to speed it by any means. history was moving their way. They were trying to speed it by any means, that, as history may record, compounds their personal felonies with national tragedy. For it would be no less than national tragedy if men came to regard the election of 1972 as fraud; or attempted to reverse the verdict of the people at the polls on the technicalities of a burglary, in a spasm of morality approaching the hysterical.

The Democratic Party, which called itself the party of the future, had become, in their eyes, the party of the past. They turned instead to Richard Nixon, affirming the change of direction he declared he was giving to government—a restraint on the power and reach of the Federal state into daily life. However his use of the power of state may be defined in the months or years to come, use of the power ot state may be defined in me months or years to come, For this time, they preferred to live their own lives privately—unplagued by moralities, or war, or riots, or violence. In the alternation of the sequences of American history, in the cycle between poetry and pragmatism, in those generational shifts of mood characteristic of the adventure in democracy certainly the ideas of the minority who voted for McGovern would come into then: time again. Those ideas still stirred in the spirit of the nation. But until those ideas had new form, new shape, new perspective, the majority of Americans would not be called out to march in their cause. Such was their mandate in 1972.

An educative read on American history and politics.

On Writing

I recently finished reading On Writing – A Memoir of the Craft – by Stephen King.

Below are key excerpts from the book that I found to be particularly insightful:

Let’s get one thing clear right now, shall we? There is no Idea Dump, no Story Central, no Island of the Buried Bestsellers; good story ideas seem to come quite literally from nowhere, sailing at you right out of the literally from nowhere, sailing at you right out of the empty sky: two previously unrelated ideas come together and make something new under the sun. Your  job isn’t to find these ideas but to recognize them when they show up.

It starts with this: put your desk in the corner, and every time you sit down there to write, remind yourself why it isn’t in the middle of the room. Life isn’t a support-system for art. It’s the other way around.

You can approach the act of writing with nervousness, excitement, hopefulness, or even despair—the sense that you can never completely put on the page what’s in your mind and heart. You can come to the act with your fists clenched and your eyes narrowed, ready to kick ass and take down names. You can come to it because you want a girl to marry you or because you want to change the world. Come to it any way but lightly. Let me say it again: you must not come lightly to the blank page.

I am approaching the heart of this of this book with two theses, both simple. The first is that good writing consists of mastering the fundamentals (vocabulary, gram mar, the elements of style) and then filling the third level of your toolbox with the right instruments. The second is that while it is impossible to make a competent writer out of a bad writer, and while it is equally impossible to make a great writer out of a good one, it is possible, with lots of hard work, dedication, and timely help, to make a good writer out of a merely competent one.

Write what you like, then imbue it with life and make it unique by blending in your own personal knowledge of life, friendship, relationships, sex, and work. Especially work. People love to read about work.

Do you do it for the money, honey? The answer is no. Don’t now and never did. Yes, I’ve made a great deal of dough from my fiction, but I never set a single word down on paper with the thought of being paid for it. I have done some work as favors for friends—logrolling is the slang term for it— but at the very worst, you’d have to call that a crude kind of barter. I have written because it fulfilled me. Maybe it paid off the mortgage on the house and got the kids through college, but those things were on the side—I did it for the buzz. I did it for the pure joy of the thing. And if you can do it for joy, you can do it forever.

On a closing note:

Writing isn’t about making money, getting famous, getting dates, getting laid, or making friends. In the | end, it’s about enriching the lives of those who will read your work, and enriching your own life, as well. It’s about getting up, getting well, and getting over. Getting happy, okay? Getting happy. Some of this book— perhaps too much—has been about how I learned to do it. Much of it has been about how you can do it better. The rest of it—and perhaps the best of it— is a permission slip: you can, you should, and if you’re brave enough to start, you will. Writing is magic, as much the water of life as any other creative art. The water is free. So drink. Drink and be filled up.

A highly recommended read in the areas of writing and storytelling.

On How To Solve It

I recently finished reading How To Solve It – A New Aspect Of Mathematical Method – by George Polya.

Below are key excerpts from this book that I found particularly insightful:

A great discovery solves a great problem but there is a grain of discovery in the solution of any problem. Your problem may be modest; but if it challenges your curiosity and brings into play your inventive faculties, and if you solve it by your own means, you may experience the tension and enjoy the triumph of discovery. Such experiences at a susceptible age may create a taste for mental work and leave their imprint on mind and character for a lifetime.

Studying the methods of solving problems, we perceive another face of mathematics. Yes, mathematics has two faces; it is the rigorous science of Euclid but it is also something else. Mathematics presented in the Euclidean way appears as a systematic, deductive science; but mathematics in the making appears as an experimental, inductive science. Both aspects are as old as the science of mathematics itself. But the second aspect is new in one respect; mathematics “in statu nascendi,’ in the process of being invented, has never before been presented in quite this manner to the student, or to the teacher himself, or to the general public.

Trying to find the solution, we may repeatedly change our point of view, our way of looking at the problem. We have to shift our position again and again. Our conception of the problem is likely to be rather incomplete when we start the work; our outlook is different when we have made some progress; it is again different when we have almost obtained the solution.

Where should I start? Start from the statement of the problem. What can I dot Visualize the problem as a whole as clearly and as vividly as you can. Do not concern yourself with details for the moment. What can I gain by doing so? You should understand the problem, familiarize yourself with it, impress its purpose on your mind. The attention bestowed on the problem may also stimulate your memory and prepare for the recollection of relevant points.

It would be a mistake to think that solving problems is a purely “intellectual affair”; determination and emotions play an important role. Lukewarm determination and sleepy consent to do a little something may be enough for a routine problem in the classroom. But, to solve a serious scientific problem, will power is needed that can outlast years of toil and bitter disappointments.

If you cannot solve the proposed problem do not let this failure afflict you too much but try to find consolation with some easier success, try to solve first some related problem; then you may find courage to attack your original problem again. Do not forget that human superiority consists in going around an obstacle that cannot be overcome directly, in devising some suitable auxiliary problem when the original one appears insoluble.

The future mathematician should be a clever problem-solver:; but to be a clever problem-solver is not enough. due time, he should solve significant mathematical problems; and first he should find out for which kind of problems his native gift is particularly suited.

In closing:

Going around an obstacle is what we do in solving any kind of problem: the experiment has a sort of symbolic value. The hen acted like people who solve their problem muddling: through, trying again and again, and succeeding eventually by some lucky accident without much insight into the reasons for their success. The dog who scratched and jumped and barked before turning around solved his problem about as well as we did ours about the two containers. Imagining a scale that shows the waterline in our containers was a sort of almost useless scratching, showing only that what we seek lies deeper under the surface. We also tried to work forwards first, and came to the idea of turning round afterwards. The dog who, after brief inspection of the situation, turned round and dashed off gives, rightly or wrongly, the impression of superior insight. No, we should not even blame the hen for her clumsiness. There is a certain difficulty in turning round, in going away from the goal, in proceeding without looking continually at the aim, in not following the direct path to the desired end. There is an obvious analogy between her difficulties and our difficulties.

A highly recommended read in the area of problem solving.

On Confessions of an Advertising Man

I recently finished reading Confessions of an Advertising Man by David Ogilvy.

Below are key excerpts from the book that I found to be particularly insightful:

Today, the world of advertising faces four problems of crisis dimensions. The first problem is that manufacturers of package-goods products, which have always been the mainstay of advertising, are spending twice as much on price-off deals as on advertising…The second problem is that advertising agencies, notably in Britain, France, and the United States, are now infested with people who regard advertising as an avant-garde art form…The third problem is the emergence of megalomaniacs whose mind-set is more financial than creative. They are building empires by buying up other agencies, to the consternation of their clients.  The fourth problem is that advertising agencies still waste their clients’ money repeating the same mistakes.

(1) Creating successful advertising is a craft, part inspiration but mostly know-how and hard work. If you have a modicum of mostly know–how and hard work. If you have a modicum of talent, and know which techniques work at the cash register, you will go a long way. (2) The temptation to entertain instead of selling is contagious. (3) The difference between one advertisement and another. when measured in terms of sales, can be as much as nineteen to one. (4) It pays to study the product before writing your advertisements. (5) The key to success is to promise the consumer a benefit – like better flavor, whiter wash, more miles per gallon, a better complexion. (6) The function of most advertising is not to persuade people to try your product, but to persuade them to use it more often than other brands in their repertoire. (Thank you, Andrew Ehrenberg.) (7) What works in one country almost always works in other countries.

(1) I admire people who work hard, who bite the bullet. I dislike passengers who don’t pull their weight in the boat…(2) I admire people with first-class brains, because you cannot run a great advertising agency without brainy people. But brains are not enough unless they are combined with intellectual honesty…(4) I admire people who work with gusto. If you don’t enjoy what you are doing, I beg you to find another job…(6) I admire self-confident professionals, the craftsmen who do their jobs with superlative excellence. They always seem to respect the expertise of their colleagues. They don’t poach. (7) I admire people who hire subordinates who are good enough to succeed them. I pity people who are so insecure that they feel compelled to hire inferiors as their subordinates.

(1) I try to be fair and to be firm, to make unpopular decisions without cowardice, to create an atmosphere of stability, and to listen more than I talk. (2) I try to sustain the momentum of the agency – its ferment, its vitality, its forward thrust. (7) I try to recruit people of the highest quality at all levels, to build the hottest staff in the agency business. (8) I try to get the best out of every man and woman in the agency.

The agencies which are most successful in new business are those whose spokesmen show the most sensitive insight into the psychological make-up of the prospective client. Rigidity and salesmanship do not combine.

Some agencies pander to the craze for doing everything in committee. They boast about “teamwork” and decry the role of the individual. But no team can write an advertisement, and I doubt whether there is a single agency of any consequence which is not the lengthened shadow of one man.

(1) What You Say Is More Important Than How You Say It. (2) Unless Your Campaign Is Built Around a Great Idea, it Will Flop. (3) Give the Facts. (4) You Cannot Bore People into Buying. (5) Be Well-Mannered, But Don’t Clown. (6) Make Your Advertising Contemporary. (7) Committees Can Criticize Advertisements, But They Cannot Write Them. (8) If You Are Lucky Enough To Write a Good Advertisement, Repeat It Until It Stops Pulling. (9) Never Write an Advertisement Which You Wouldn’t Want Your Own Family To Read. (10) The Image and the Brand. (11) Don’t Be a Copy-Cat.

On a concluding note, “a collection of Ogilvy-isms”:

We prefer the discipline of knowledge to the anarchy of ignorance. Tell the truth, but make the truth fascinating. In the best establishments, promises are always kept. whatever it may cost in agony and overtime. Change is our lifeblood. It is important to admit your mistakes and to do so before you are charged with them.

A recommended concise and perceptive read in the areas of advertising, and influence.

 

On Walden or Life in the Woods

I recently finished reading Walden; or Life in the Woods by Henry David Thoreau. The backdrop for this literary masterpiece is: “When I wrote the following pages, or rather the bulk of them, 1 lived alone, in the woods, a mile from any neighbor, in a house which I had built myself, on the shore of Walden Pond, in Concord, Massachusetts, and earned my living by the labor of my hands only. I lived there two years and two months. At present I am a sojourner in civilized life again.”

Below are key excerpts from the book that I found particularly insightful:

I think that we may safely trust a good deal more than we do. We may waive just so much care of ourselves as we honestly bestow elsewhere. Nature is as well adapted to our weakness as to our strength. The incessant anxiety and strain of some is a well nigh incurable form of disease. We are made to exaggerate the importance of what work we do; and yet how much is not done by us! or, what if we had been taken sick? How vigilant we are! determined not to live by faith if we can avoid it; all the day long on the alert, at night we unwillingly say our prayers and commit ourselves to uncertainties. So thoroughly and sincerely are we compelled to live, reverencing our life, and denying the possibility of change.

Most of the luxuries, and many of the so called comforts of life, are not only not indispensable, but positive hinderances to the elevation of mankind. With respect to luxuries and comforts, the wisest have ever lived a more simple and meagre life than the poor. The ancient philosophers, Chinese, Hindoo, Persian, and Greek, were a class than which none has been poorer in outward riches, none so rich in inward.

With a little more deliberation in the choice of their pursuits, all men would perhaps become essentially students and observers, for certainly their nature and destiny are interesting to all alike. In accumulating property for ourselves or our posterity, in founding a family or a state, or acquiring fame even, we are mortal; but in dealing with truth we are immortal, and need fear no change nor accident.

I find it wholesome to be alone the greater part of the time. To be in company, even with the best, is soon wearisome and dissipating. I love to be alone. I never found the companion that was so companionable as solitude. We are for the most part more lonely when we go abroad among men than when we stay in our chambers. A man thinking or working is always alone, let him be where he will. Solitude is not measured by the miles of space that intervene between a man and his fellows.

“You who govern public affairs, what need have you to employ punishments? Love virtue, and the people will be virtuous. The virtues of a superior man are like the wind; the virtues of a common man are like the grass; the grass, when the wind passes over it, bends.”

Such is oftenest the young man’s introduction to the forest, and the most original part of himself. He goes thither at first as a hunter and fisher, until at last, if he has the seeds of a better life in him, he distinguishes his proper objects, as a poet or naturalist it may be, and leaves the gun and fish-pole behind.

On a concluding note:

The earth is not a mere fragment of dead history, stratum upon stratum like the leaves of a book, to be studied by geologists and antiquaries chiefly, but living poetry like the leaves of a tree, which precede flowers and fruit, —not a fossil earth, but a living earth; compared with whose great central life all animal and vegetable life is merely parasitic. Its throes will heave our exuviae from their graves. You merely parasitic. Its throes will heave our exuviae from their graves. You can; they will never excite me like the forms which this molten earth flows out into. And not only it, but the institutions upon it, are plastic like clay in the hands of the potter.

On The Demon Under The Microscope

I recently finished reading The Demon Under The Microscope by Thomas Hager. As the author summarizes this book: “Once a bacterial disease took hold in the body, humans in 1931 were as much the prey of the invisible killers as they had been since the beginning of history. All that was about to change…Sulfa happened. It started in the mid-1930s, with a series of findings made in Germany and France, discoveries that were at the time hailed as “the miracle of miracles” in modern medicine, advances that secured humans their first effective way to stop bacterial infections once they started. The work then spread to Great Britain and the United States, where tests of the still-experimental drug on humans. including the son of the president of the United States, confirmed its power.”

Below are key excerpts from the book that I found to be particularly insightful:

Nothing like it had been seen before. IG Farben was on the day of its birth the largest corporation in Germany, the largest business in Europe, the largest and most powerful chemical company in the world. It was also the world s third-largest business of any sort measured by numbers of employees, bested in the mid-1920s only by U.S. Steel and General Motors. As Duisberg hoped, the IG Farben structure led to coordinated research and rationalized production; member firms began complementing one another’s efforts rather than duplicating them; resources were freed to invest in the next big products to generate the next big profits. At Bayer those products would include a number of new medicines.

Childbed fever was rampant in the wards attended by students. Something appeared to be passing the infection from the dead women to the students and physicians, then from them to women in the delivery room. Semmelweis thought it likely, given the pattern, that the student physicians were carrying something, some bits of infectious material, perhaps scraps of tissue from the autopsies, from the autopsy area to the wards. These were the days before Lister and before Pasteur had shown that bacteria could cause disease. Hand washing was minimal, if it was done at all. The students and medical staff wore no gloves. All the doctors, young and old, generally wore the same clothes for days. Semmelweis came to believe that the infectious material was likely carried on the hands. To test the idea, he instructed all of his students to start washing their hands thoroughly in chloride of lime after any autopsy and before touching any patient. Then he tracked the results. As he had hoped, deaths among women treated by his students fell dramatically. Semmelweis excitedly told everyone about his findings, and soon his hand-washing practices were adopted throughout the Vienna Lying-in Hospital. Within a few years, the death rate in Division 1 fell to match that in Division 2. The pregnant women of Vienna stopped begging to be given a midwife.

But, amn7inolv the second molecule, Kl-821—sulfanilamide linked not to an azo frame but instead to a relatively simple carbon-and-nitrogen string—worked, and worked extremely well. It stopped Strep infections in both mice and rabbits. When the first test results came in in mid-April, Domagk immediately ordered retests in strep-infected rabbits and got even better results.

The grand dream of an effective antibacterial chemical—history’s first—was about to be realized. Despite all the worries, skepticism, and disbelief, it appeared that Prontosil really cured human disease. A nontoxic internal disinfectant exquisitely targeted to bacteria, Ehrlich’s long-sought Zauherkugeln, had finally been found. Panacea, after thousands of years of failed attempts, had finally awakened.

By 1938, it was estimated that sulfa was saving the lives of ten thousand new mothers each year in Britain and the United States alone.

Science still seemed to offer reason for optimism. By the time Sir Henry accepted his Nobel medal in Stockholm, however. Hitler had marched troops into the demilitarized Rhineland, Japan and Italy had allied with Germany—and the French, just four years after the discovery of Prontosil, were about to make the new German miracle drug worthless.

Most important, however, was the discovery that the world’s most effective antibacterial medicine was also among the simplest ever found. Everyone had been searching through all these complicated dyes, tinkering around the edges, while the real power was in a colorless add-on. As Bovet later put it, the Germans’ complicated red car had a simple white engine.

Like all great discoveries, sulfa engendered a host of unexpected benefits. During the postwar period, Prontosil and its chemical oirspring gave birth not just to antibiotics but to other new approaches to disease. Domagk’s work, as noted, led to the semithiocarbazones for treating tuberculosis. That was just the beginning. When one doctor observed that patients taking sulfa urinated more often than others, subsequent research led to trying sulfa variants as a diuretic, a medicine used to increase urination and thus to alter the fluid balance in the body Eventually it led to the thiazide drugs, an important early family of diuretics used to treat hypertension. Understanding sulfas mode of action—its ability to act as an “antimetabolite” that substituted for a needed foodstuff, starving the target microorganism to death—led to research into other antimetabolites; the most important result was a family of new anticancer drugs. Another line of inquiry that started with sulfa led to antileprosy medications, another to a treatment for diabetes, another to a new line of antimalarials. In all these cases, the starting point was sulfa, but the end point was new kinds of medicine.

In closing:

Every great drug discovery (and every modem technological advance) carries with it, like the blood of the Gorgon mentioned in the epigraph that begins this b0ok, two opposing qualities: one positive, healing, and helpful; one negative, often unintended, sometimes deadly The ancient Greeks understood that. We must remember it, too.

A highly recommended read in the area of medicine.

On The Rise Of Theodore Roosevelt

I recently finished reading The Rise Of Theodore Roosevelt by Edmund Morris. As the title indicates this is a book that chronicles the early stages of Theodore Roosevelt from birth to his ascension to US Presidency.

Below are key excerpts from the book:

Politically, too, it has been a year of superlatives, many of them supplied, with characteristic immodesty, by the President himself. “No Congress in our time has done more good work,” he fondly told the fifty-ninth, having battered it into submission with the sheer volume of his social legislation. He calls its first session “the most substantial” in his experience of public affairs. Joseph G. Cannon, the Speaker of the House, agrees, with one reservation about the President’s methods. “Roosevelt’s all right,” says Cannon, “but he’s got no more use for the Constitution than a tomcat has for a marriage license.”

Roosevelt is used to such criticism. He has been hearing it all his life. “If a man has a very decided character, has a strongly accentuated career, it is normally the case of course that he makes ardent friends and bitter enemies.”‘Yet even impartial observers will admit there is a grain of truth in Twain’s assertions. The President certainly has an irrational love of battle. He ceaselessly praises the joys of righteous killing, most recently in his annual message to Congress: “A just war is in the long run far better for a man’s soul than the most prosperous peace.”

To say that Theodore Roosevelt made a vivid first impression upon his colleagues would hardly be an exaggeration. From the moment that he appeared in their midst, there was a chorus of incredulous and delighted comment. Memories of his entrance that night, transcribed many years later, vary as to time and place, but all share the common image of a young man bursting through a door and pausing for an instant while all eyes were upon him—an actor’s trick that quickly became habitual. This gave his audience time to absorb the full brilliancy of his Savile Row clothes and furnishings.

Like a child, said Isaac Hunt, the young Assemblyman took on new strength and new ideas. “He would leave Albany Friday afternoon, and he would come back Monday night, and you could see changes that had happened to him. Such a superabundance of animal life was hardly ever condensed in a human [being].

Although the World claimed, with possible truth, that New Yorkers were pleased to see Roosevelt go,few could deny that his record as Commissioner was impressive. “The service he has rendered to the city is second to that of none,” commented The New York Times, “and considering the conditions surrounding it, it is in our judgment unequaled.” He had proved that it was possible to enforce an unpopular law, and, by enforcing it, had taught the doctrine of respect for the law. He had given New York City its first honest election in living memory. In less than two years, Roosevelt had depoliticized and deethnicized the force, making it once more a neutral arm of government. He had broken its connections with the underworld, toughened the police-trial system, and largely eliminated corruption in the ranks. The attrition rate of venal officers had tripled during his presidency of the Board, while the hiring of new recruits had quadrupled—in spite of Roosevelt’s decisions to raise physical admission standards above those of the U.S. Army, lower the maximum-age requirement, and apply the rules of Civil Service Reform to written examinations. As a result, the average New York patrolman was now bigger, younger, and smarter. “He was also much more honest, since badges were no longer for sale. and more soldier-like (the military ideal having been a particular feature of the departing commissioner’s philosophy). Between May 1895 and April 1897, Roosevelt had added sixteen hundred such men to the force.

Well might he be happy. Theodore Roosevelt had cone home to find himself the most famous man in America—more famous even than Dewey, whose victory at Manila had been eclipsed (if temporarily) by the successive glories of Las Guasimas, San Juan, Santiago, and the round-robin which “brought our boys back home.” The news that the United States and Spain had just signed a peace initiative came as a crowning satisfaction. Intent as Roosevelt might be to parry questions about his gubernatorial ambitions—thereby strengthening rumors that he had already decided to run—his days as a soldier were numbered. It remained only to spend five days in quarantine, and a few weeks supervising the demobilization of his regiment, before returning to civilian life and claiming the superb inheritance he had earned in Cuba.

One of the first outsiders to congratulate Roosevelt was William McKinley, who sent a handwritten expression of unqualified good wishes…There comes a time in the life of a nation, as in the life of an individual, when it must face great responsibilities, whether it will or no. We have now reached that time. We cannot avoid facing the fact that we occupy a new place among the people of the world, and have entered upon a new career.. . . The guns of our warships in the tropic seas of the West and the remote East have awakened us to the knowledge of new duties. Our flag is a proud flag, and it stands for liberty and civilization. Where it has once floated, there must be no return to tyranny or savagery . . .

If not the first, Theodore Roosevelt was certainly one of the first politicians to act responsibly in view of the changing economics and class structure of late-nineteenth-century America. As such he deserves to be ranked only slightly behind Altgeld and Pingree and Jones. If his governorship, which lasted only two years (and was subject to enormous distractions in the second), was less spectacular than some, it was spectacular enough in terms of his own membership in the social and intellectual elite. One thinks of his early contempt for unions, for Henry George, for the unwashed Populists, for the rural supporters of William Jennings Bryan. Yet as Governor, Roosevelt had shown himself again and again willing to support labor against capital, and the plebeians in their struggle against his own class.

A highly recommended read in the area of politics. I look forward to reading the sequel, Theodore Rex.