Chip War : Book Review

Book Review #20

Silicon Chips today help run everything from cars and toys to phones and nuclear missiles. Last week, I finished reading "Chip War" by Prof. Chris Miller, where he outlines the evolution and the major geopolitical implications of the Chip industry in today's day and age. Here is a summary of this interesting story in my words

- Vacuum tubes with a positive (Anode) and negative (Cathode) electrode when combined with control electrode served as the first controlled amplifiers (transistors) of electrical signals. In 1947, William Shockley, Walter Brattain and John Bardeen created the world’s first transistor made out of semiconductor materials beginning the end for vacuum tubes

- In 1955, eight engineers working under Shockley, including Bob Noyce (who invented the Integrated Circuit) and Gordon Moore left to start Fairchild Semiconductor tracing the early beginnings of Silicon Valley. Moore predicted that the number of transistors crammed on a silicon chip would double every two years and this has held true since the 1960s. Noyce and Moore later founded Intel together

- Failure to land missiles on target cost the US dearly in the Vietnam war but microchips help solve this and powered a decisive victory for the US in the 1991 Gulf war. While Nikita Khrushchev's USSR slipped in chip technoligy, Mao Zedong's cultural revolution pushed the Chinese also behind through the 70s

- Trying to beat high quality/low cost chips by Japanese companies, the US brought chip manufacturing to Korea, Taiwan and Singapore and over time the industry has concentrated and today a tiny number of companies control chip production

- Morris Chang, overlooked by Texas Instruments for CEO, started Taiwan Semiconductor Company (TSMC) with government support and TSMC today carves microscopic mazes of tiny transistors smaller than half the size of a coronavirus. Today, western companies focus only on chip design leaving the fabrication to TSMC, Samsung, GlobalFoundries and few other companies

- China, as a late entrant, decided to invest in chip companies with government support first through SMIC in the year 2000 and soon after with Huawei. While Huawei had some initial benefits from intellectual property theft, much of their success was driven by efficient manufacturing and world-leading R&D. Huawei's ascendence and the fear of spying tools led to Australia, UK and US invoke a series of restrictions that weakened Huawei and made them divest part of their smartphone business and delay 5G rollouts

- China's array of warfare capabilities including long-range & anti-ship missiles and anti-satellite systems make them a powerful opponent of the US. While the optimists hope that there will be no attempt From China to invade Taiwan, the concentration of the chip industry in Taiwan (37% of the world's logic chips) puts the world at a huge economic risk should there be a conflict

Overall, a thrilling book and a must read!

#semiconductors #geopolitics #bookreview

Metabolical : Book Review

Book Review #19

Just finished "Metabolical" by Dr. Robert Lustig, a must-read for anyone who cares about healthy living. Metabolical = Metabolic + Diabolical - you get the drift. Here is an attempt to summarize the insights and action points from this super book.

- The book's core advice can be summarized in six words: a) protect the liver, b) feed the gut. Our livers are stuffed, and our intestines are starved—because of processed food.

- Pesticides are just 10% of our problem. 90% is due to processed food and is the primary cause for diabetes, fatty liver disease, heart disease, and tooth decay; correlative for cancer, dementia, hypertension, and depression; and plausible for autoimmune disease and anxiety

- Don't go by nutrition labels; it is not what’s in the food—it’s what’s been done to the food that matters

- Refined carbohydrate and dietary sugars are the biggest cause of type 2 diabetes. Mitochondria in your cells divert excess glucose (from carbs/sugar) into fat. When this happens in the liver, you get fatty liver, leading to insulin resistance

- Avoid food that has Fructose or High Fructose Corn Syrup. Fructose makes twice as much liver fat vs. glucose and generates 100 times more oxygen radicals causing cell dysfunction and structural damage to lipids, proteins and DNA

- Fiber is the single most important nutrient for health, as it protects the liver and feeds the gut. You don’t absorb fiber but it is for your the 100 trillion gut bacteria in your intestine

- Vegan diets and Keto diets are both extreme diets and either can cause problems. Big Food industry benefits from either and peddles both processed carbs and processed meat.

- Of all antibiotics sold in 2014, only 20 percent were for human use, 80 percent were used on livestock and poultry; these antibiotics survive slaughter and processing, and reach our intestines

- Seed oils are high in omega-6 fatty acids, that are highly inflammatory; Omega-3s, found in fish, nuts and seeds, are anti-inflammatory

- You can grow green vegetables almost anywhere—and it’s Real Food. And you can turn dirt back into soil. It’s called regenerative farming. You just need a cow :)

- Genetics explains only 15% of chronic disease, 85 percent is environmental

- Avoid and detest packaged food and instead eat real whole food; Robert's cookbooks are available free at www.eatreal.org

- It is a long and arduous fight against Big Food. Example, the dangers of trans-fats were first known in 1957 and Fred Kummerow fought till 2013 (he was 99 by then) when FDA finally acknowledged that trans fats weren't safe

- One way or another, you’re going to pay. You can either pay the farmer or the doctor—which would you prefer? Make a conscious choice

Eat Real and stay healthy.

#bookreview #food #healthylife Robert Lustig

The 12% Solution : Book Review

 

Book Review #18

I just finished reading a very short and interesting book called "The 12% Solution" that promises to help individual investors with a long-term systematic investment strategy that can consistently beat market and prevent big losses during market correction.

The author, David Alan Carter says this book is for you if
- You are afraid of a major market correction because you have already seen at least one major market correction
- You purchased one too many “hot” stocks touted by influencers/TV gurus only to blow up your hard-earned money
- You tried mutual fund investing but your returns always lag the S&P 500

So, let me quickly summarize the essence of this investing approach for you.

1) Momentum investing and rotation are at the core of this rules-based investing approach. Decades of data confirms that momentum investing holds that trends can persist for some time, and it’s possible to profit by staying with a trend until its conclusion

2) The best way to make money is to not lose it. In other words, the ultimate success of any investment plan depends on one simple element: minimizing losses

3) Every month, few trades will be done at the end of the month (last trading day). For this your investment corpus will be allocated in a 60:40 ratio across a mix of equity and bond funds. A 3-month lookback period is defined as the optimal history for determining which ETFs to rotate the money across, and only monthly trades are advised to screen out market noise

4) The 60% on Equity is the "risk-on" part of the investment. At the end of every month, the ETFs for our risk-on trade are - SPY (S&P 500 ETF), MDY (Mid-cap 400 ETF), QQQ (Nasdaq-100 Index™ and features Apple, Google, Microsoft etc.), and IWM (US Equity small cap). At the end of every month, you review the 3-month trend of these four and move your equity component to the one that is showing the best trend in the last 3 months. And if all of them are showing negative returns then you move the equity component to cash or the cash-equivalent ETF (1-3 Year Treasury Bonds). This is called the cash trigger

5) The 40% on Bonds is the "hedge" part of the investment. At the end of every month, the ETFs for our hedge trade are - JNK (SPDR High Yield Bond ETF) and TLT (20 Plus Year Treasury Bond ETF). As with the equity part you reallocate your hedge component to either JNK or TLT.

6) The only other trade that remains is to do the trade that will rebalance and ensure that you maintain the 60/40 mix of risk-on and hedge investments. After this do not let the daily market noise lure you to do anything

The author has put up his results on the website https://lnkd.in/g_sXW8ZH and the results are for us to see (see pic 2 attached). Definitely the approach beats the S&P 500 and for most investors who cannot actively trade and time the market it seems to be a very effective method.

Thanks Stephen Christopher, MD for the book recommendation.

#bookreview #investing #money

The Crux: How Leaders Become Strategists - Book Review

Book Review #17

“Everyone has a plan until they get punched in the mouth” - Richard Rumelt quotes Mike Tyson's legendary words in this excellent book titled - "The Crux: How Leaders Become Strategists".

Richard busts the myth that a concoction of vision, mission and goals is strategy. He uses a mountaineering analogy to explain how overcoming the most difficult section/precipice is 'The Crux' of conquering a climb. Likewise, identifying the one most important 'gnarly challenge' in a business is indeed 'The Crux' of developing strategy.

Here are my key takeaways from the book.

1) The problem for most businesses is that strategic-planning exercises do not produce strategies. They rather attempt to predict and control financial outcomes (they are just a form of budgeting). After glancing at broader issues, it quickly centers on financial goals followed by budget allocations

2) Don’t start with goals — When a leader sets a goal, it is actually a decision on what is important and where resources and energy will go. Instead, start by understanding the challenge and finding its crux. Strategic challenges arise in three forms: choice, engineering design, but most often gnarly

3) Faced with a gnarly challenge, the strategist recognizes/forges an embedded solvable problem — not the whole gnarly challenge, but one with kinship to its key elements. And it is a problem that is possible to address

4) Mastery over a gnarly challenge arises only after the crux has been exposed when you see or recognize the locus of tension in the web of conflicting desires, needs, and resources

5) The concept of a crux narrows attention to a critical issue. The art of strategy is in defining a crux that can be mastered and in seeing or designing a way through it

6) The first part is judgment about which issues are truly important and which are secondary. The second part is judgment about the difficulties of dealing with these issues. And the third part is the ability to focus, to avoid spreading resources too thin, not trying to do everything at once. The combination of these three parts lead to a focus on the crux—the most important part of a set of challenges that is addressable, having a good chance of being solved by coherent action

7) The distinction between strategy and tactics arises in the military and denotes the difference between the general’s action plan and the top sergeant’s action plan. It is not about long-term vs short-term

8) Don’t Confuse Strategy with Management & Don’t Confuse Current Financial Results with Strategy

9) Strategy Foundry is a methodology to help a leadership team breakaway from treating strategy as goal setting. It helps identify key challenges, diagnose their structures, identify the crux, and work out how to address it. It is different from strategic planning or strategy workshops, where the outcome is essentially a long-term budget

Thanks for the recommendation Shiv Shivakumar

#bookreview #strategy #leadership Richard Rumelt

#bookreview #strategy #leadership