Back from summer break!
Actually, my laptop broke and I was too lazy to replace it until recently. I caved and bought an M1 Mac. I didn’t realize how few apps have native ARM binaries; most rely on x86 emulation, and it seems fast enough right now. Benchmarks concur.
The Five Best Things
Tyler Cowen: How Gaming will change humanity as we know it
It’s been a very interesting few months for observers of the Metaverse concept, as it picks up in the mainstream. Microsoft CEO Satya Nadella staked a claim for the ‘enterprise metaverse’, Facebook CEO Mark Zuckerberg is betting the future of the company on it, and Netflix is introducing video games tied to its original content.
Tyler Cowen argues that these developments are heralding a change for culture and government regulation. While cultural tenets build upon themselves and invite observation, games tend to be a self-contained universe that instead require participation. Similarly, government regulation has yet to catch up to the fact that trading - involving currencies, markets, prices and contracts - is taking place in games already.
Just as gaming has outraced the world of culture, so will gaming outrace U.S. regulatory capabilities, for a variety of reasons: encryption, the use of cryptocurrency, the difficulties of policing virtual realities, varying rules in foreign jurisdictions and, not incidentally, a lack of expertise among U.S. regulators.
Meanwhile, China has taken a heavy hammer approach and restricted gaming to 3 hours a week.
Consumers are becoming participatory creators and will want to carry their creations and maximize their rewards across multiple virtual worlds. For this reason I think its unlikely that a single company will dominate - consumer preferences hew towards interoperability and openness. It’s also a devilishly hard problem to solve for technically, and developments here will be fun to watch in the next few years.
Charlie Snell: Alien Dreams: An Emerging Art Scene
What role will Machine Learning play in the development of our virtual worlds? In the 9 months since OpenAI released a pair of image generation (DALL-E) and classification (CLIP) models, people have been experimenting with generating art with just a few text prompts.
A growing community of artists, researchers, and hackers have been experimenting with these models and sharing their outputs. People have also been sharing code and various tricks/methods for modifying the quality or artistic style of the images produced. It all feels a bit like an emerging art scene.
Charlie Snell, a UC Berkeley grad student catalogues some amazing examples in this post. Some cherry-picked examples below, although I highly encourage reading the entire post which covers a history of image generation models.
Asking for “an abstract painting of a planet ruled by little castles” results in this satisfying and trippy piece:
You can create little animations with this same method too. In my own experimentation, I tried asking for “Starry Night” and ended up with this pretty cool looking gif:
The “Unreal Engine” trick is really wild
All you need to do is add some specific key-words to your prompt that indicate something about the style of your desired image and CLIP will do its best to “understand” and modify its output accordingly. For example you could append “in the style of Minecraft” or “in the style of a Cartoon” or even “in the style of DeepDream” to your prompt and most of the time CLIP will actually output something that roughly matches the style described. In fact, one specific prompting trick has gained quite a bit of traction. It has become known as the “unreal engine trick”.
Can you imagine the possibilities of being able to generate art on command? Entering this prompt - “matte painting of a house on a hilltop at midnight with small fireflies flying around in the style of studio ghibli | artstation | unreal engine”, results in this. Just wild..
Howard Marks: Thinking About Macro
Talking about other things that may or may not be real: Inflation! Maybe you think it’s temporary, like U.S Fed Chair Jerome Powell, or maybe it’s here to stay as other highly-titled economists think. Or maybe, as Howard Marks proclaims in his latest letter - nobody knows.
So what are we supposed to do? Marks still thinks stocks are for the most part reasonably priced, but one could invest in floating rate debt (such as the treasury’s I-bonds), monopolistic businesses with pricing power, or fast growing companies.
2/ So inflation - the only thing we know is that nobody knows jack shit about inflation. Inflation is mysterious. So many got rich off Robinhood in 2020. Ok back to inflation. There are reasons to believe inflation can go higher, or it can be transitory. But impossible to know.3/ I wrote a bunch of memo in 2016 to tell people nobody knows jack shit about anything. WSJ and the talking heads are too confident to try to explain everything about the market. They think stonk prices are declining because of fear of inflation…4/ But bond market doesn’t agree. And also gold (inflation hedge) fell too. These talking heads and forecasters, you guys are as useful as a broken condom! The Fed isn’t scared of inflation. Economy doing well now but Fed continues to keep rates near zero and buy bonds like mad.5/ Why? Fed more afraid of slowdown. But I think we should fear inflation. Why? If my boomer memory serves me correctly, higher interest rates will kill us all! I don’t know what’s going on but there’s something deeply wrong with everything, with the Fed, debt, everything.6/ We’re not going to be okay forever. Smell something fishy. Fed is too active. Alan Greenspan is a control freak. Want Fed to do less. Intervene in interest rate only when necessary. Back to inflation - anything anyone says about inflation is guesswork.7/ I’ll say it again - nobody knows jack shit about inflation. So what should investors do? Remain fully invested, until you’re on the brink of shitting your pants. Asset prices don’t seem irrational relative to rates. But where will rates go? Depends on inflation.
The best summary of the letter is as always, on Twitter
The Generalist: Tech in Africa
I read this briefing on the African tech and venture landscape over the summer; I found it eye opening and educational. I’ve bookmarked it as reference material as I seek to educate myself about the second largest continent, with a population of 1.2 Billion and expected to double in the next 30 years, with more than half the population under 25 years of age.
Today, Africans make up 16% of the global population; by 2050, they will comprise 25%. Half of the expected 2.4 billion will live in five countries: Nigeria (411 million), Ethiopia (191 million), Egypt (153 million), the Democratic Republic of Congo (197 million), and Tanzania (138 million).
Of those, Nigeria and Egypt already represent budding and flourishing tech economies. By 2050, 10 of the world’s biggest cities will be in Africa, In particular, the continent will see a rising middle class, expected to reach 580 million by 2030, with an upper class of an additional 116 million. For context, that’s more than double the current US population.
With only 22% internet penetration and 45% mobile phone penetration, opportunities for foundational infrastructure and leapfrogs abound. Funding and exits in e-Commerce and FinTech dominate today; Identity Management, Healthcare and Education are the next big bets.
The world has some heavy things going on right now; I found comfort in reading about this Syrian refugee who resettled in the U.K, became a pilot, and was appointed goodwill ambassador for UNHCR.
She went on to deliver five important steps that restored her hope and should be available for every refugee: do not label; regard education as important as food, water and safety; support university places for refugees; girls can do anything; and believe in us.
I also loved reading about other immigrant experiences here. Let’s be kind to those seeking a better life from distress.
What’s going on with NFTs? Fred Wilson explained how ownership of “Scarce” goods used to be a unique experience that is now becoming shared; my friend Erik Huckle thinks we’re building the roads to the metaverse.
McSweeney’s: WITH GOD AS MY WITNESS I WILL NOT PICK THE RESTAURANT The brief return to somewhat safe in-person socializing means the return of restaurant choice prisoner’s dilemma games.
.. broke into kitchens, squashed chickens, poked their trunks through the windows of a nursing home, crossed multilane highways, passed through a car dealership and caused more than $1 million in crop damages. They have been accused of getting drunk on fermented grain. Throughout, they’ve been trailed by a human migration: hundreds of officers, more than 60 emergency vehicles, a fleet of drones and constant media coverage.
Disclaimer: The views and opinions expressed in this post are my own and do not represent my employer.