👻Nov 1 - The Halloween-Scary Election Edition, Judges, BTC, Citizen anxiety, Quantum, Toxic cocktail...

🎧 Listen to this on the S3T Podcast!

Happy Friday! Hope you had a happy Diwali & best wishes for happiness joy and prosperity for you and your family! Welcome to the S3T podcast episode for Nov 1 -  a special Halloween & Election edition. As usual, we will be catching up on all the latest emerging tech and economic developments as well as looking at the root causes of citizen anxiety. And for those of you in the Change Leadership course, We are now on week 4 of our Change Leadership Learning series, focusing on tools that increase your ability to pivot when life brings new opportunities disguised as unexpected change.

In this Edition of S3T:

• 📉 Job Market Tension: Job openings hit a low since Jan 2021, but consumer confidence is up. Contrasting economic indicators fuel mixed views on economic health.
• 💰 Inflation Watch: Inflation cooling suggests potential rate cuts, while some see rising Bitcoin as a hedge. Notable investors debate inflation’s trajectory and government spending’s impact.
• 🤝 Crypto & Traditional Finance Team Up: Visa and Coinbase enhance real-time crypto-fund access, marking progress in integrating digital and traditional financial systems.
• 🔍 AI & Quantum Advances: OpenAI’s ChatGPT competes with Google, Claude launches desktop, and Rice Univ. advances quantum materials—each step reshaping tech landscapes.
• 🇺🇸 Election Anxiety Soars: Rising election-related anxiety highlights mental health strains. Fear-based political messaging fuels stress and division among citizens.
• 📚 Beyond Voting: Emphasizing informed, active citizenship outside elections strengthens democracy, counters polarization, and fosters a resilient society.
• 💪 Team Unity Strategies: Leaders can address anxiety by fostering transparency, supporting mental health, and celebrating wins, creating a more balanced, resilient team.

Opinions expressed are those of the individuals and do not reflect the official positions of companies or organizations those individuals may be affiliated with. Not financial, investment or legal advice, and no offers for securities or investment opportunities are intended. Mentions should not be construed as endorsements. Authors or guests may hold assets discussed or may have interests in companies mentioned.

Consumer Confidence Up but Job Openings Down

Job openings fell to lowest level since Jan 2021, but consumer confidence is sharply up. But the latest "Beige Book" (a distributed survey of economic conditions across the Federal Reserve's 12 districts) paints a more somber picture of the nation's economy than other indicators. Gregg Robb examines the diverging views here. The BEAs personal income and outlays for September (1 month lag) also show a moderating set of metrics. Some are interpreting the mix of data as a cooling of inflation that will prompt another round of interest rate cuts (next week).

The longer view on inflation

Bitcoin hits 73,600 this week just shy of its all time high in March ($73,750), a likely indicator that long term investors are hedging against future inflation.

• The view that Gov spending will increase inflation is held by investors like Stanley Druckenmiller ("Bipartisan fiscal recklessness is on the horizon.").
• The expectation that inflation will push Bitcoin to new all time highs is pushed by the likes of Paul Tudor Jones who in 2020 wrote the Great Monetary Inflation (PDF) thesis credited with launching the subsequent Bitcoin bull cycle, and a wave of institutional investor interest in Bitcoin.

Not everyone buys this paired set of views - see this point by point counter argument by Michael Lebowitz, who notes that not all government spending is the same:

• it can be unproductive & deflationary, but
• government spending can also be an important form of investment that helps fertilize and grow the economy.

Some investors as well as prediction markets seem to be anticipating a Trump win in the 2024 election, which has savvy investors considering how to position for a toxic cocktail of:

• tariffs that raise prices,
• paralyzed inflow of immigrant workers which also raise prices, and
• lopsided tax cuts that put more strain on government and household debt.

Not everyone sees a Trump win as inevitable however. After Bezos blocked the Washington Post from endorsing Harris, the Economist - which to me has always been a right leaning financial read - decided to endorse Harris.

Never a dull moment here in America. The special feature below looks at the perennial anxiety of citizens in a democracy.

In yet another example of traditional finance and crypto working together, Visa and Coinbase are partnering to enable real-time delivery of account funds with Visa debit cards. This is a step up from the current status quo which requires users to either use the Coinbase debit card, or use bank transfers that take longer to settle.

AI increases foothold in Desktop Apps & Search

OpenAI's new web search capability for ChatGPT (for paid memberships) puts it in direct competition with Google. Meanwhile Anthropic's AI assistant "Claude" is now available as a Mac/Windows desktop app (currently in beta).

Quantum inches another step forward

Physicist at Rice University have reached a deeper understanding of magnetism that has the potential to transform the materials science aspect of quantum computing. See paper here. Quantum Computing is an example of an emerging technology to keep an eye on given its possible implications for infosecurity and cryptography.

Toward Tech-Independence: More semiconductor investments

Continuing the buildout of the US's tech independence, the Biden administration is making an $825M investment in a semiconductor R&D facility near Albany NY. Getting to tech-independence isn't easy: the US's largest drone maker Skydio depends on China for parts and materials - China just imposed sanctions on Skydio for selling drones to Taiwan's National Fire Agency - basically a national fire and rescue organization.

New insights on how decision makers use algorithms

A study of how judges selectively use to bail or not to bail algorithms is yielding important new information about how human decision makers rationalize their decisions to accept or reject the advice of algorithms - sometimes in ways that might not be appropriate. The study noted a number of behavior patterns that need to be further scrutinized, and noted the sometimes judges transfer culpability to the algorithm in scenarios perceived as low risk to themselves and their reputations - in spite of higher risks to impacted individuals and the overall integrity of the justice system).

🦋Click here to go to this weeks learning segment: Change Leadership Mindset: The Open Palm

Unleash Your Pivot Power: Life’s best opportunities often come from unexpected change. Will you be ready? Pivot Power gives you the mindset to adapt, letting go of what’s past and embracing what’s next.

Pivot Power means releasing old plans, grievances, and regrets while being open to what’s next. It’s a mindset of curiosity and courage, rooted in a simple lesson from my father: Hold the things of life in an open palm. This wisdom empowers you to handle change gracefully, without letting attachments weigh you down or limit your potential.

The Open Palm Mindset is about resilience. It’s the understanding that everything we have is temporary and learning to embrace what comes and let go of what goes. It’s knowing when to pivot with life’s currents and when to persist through the work needed for growth. With this approach, you’ll find yourself prepared to navigate new career chapters, build essential connections, and showcase your value to potential employers or clients with confidence.

Special US Election Segment

Understanding pervasive anxiety in modern US Democracy

70% of Americans feel anxious or frustrated about the 2024 Presidential election and mental health crisis lines are preparing for a surge in contacts from individuals reaching out due to fear and depression. America Is Having a Panic Attack Over the Election is the headline for a WSJ piece this week.

“We know calls will spike the day before and the day of the election, and people are reaching out because of anxiety, depression, and fear about the future,” - Tia Dole, chief 988 suicide and crisis lifeline officer. 

What have we done to ourselves?

Understanding the anxiety among U.S. citizens regarding elections and democracy involves examining several contributing factors:

1. Fear Appeals in Political Communication: Political campaigns often use fear-based messaging to mobilize voters. While effective in the short term, excessive use of fear-based messaging can lead to increased public cynicism and distrust. The American Psychological Association discusses how fear serves as a powerful motivator in elections. See also: This APA comprehensive meta-analysis investigates the effectiveness of fear appeals in influencing attitudes, intentions, and behaviors, highlighting their complex psychological impact.
2. Media Manipulation and Misinformation: The proliferation of misinformation and media manipulation exacerbates public fears about electoral integrity. The Shorenstein Center Media Manipulation Casebook provides a deep dive into common tactics disinformation campaigns influence use to public perception.
3. Impact of Emotional Rhetoric: The strategic use of emotional appeals, particularly fear, in political rhetoric can significantly affect public opinion and behavior. The study "Fear, Hope, and COVID-19: Emotional Elite Rhetoric and Its Impact on the Public" explores this dynamic.
4. Public Perception of Threats: Research indicates that fear appeals in political rhetoric about terrorism can shape public perception and policy support. The article "Fear Appeals in Political Rhetoric about Terrorism: An Analysis of Speeches by George W. Bush" provides an analysis of this phenomenon in an earlier era.
5.  Not alone: Citizen Anxiety is not a uniquely American phenomenon, but there are differences between the anxieties experienced in different nations. This Harvard paper takes a comparative approach that reviews the anxiety citizens feel in different democracies and the different and common reasons for this anxiety.

These resources offer a comprehensive understanding of how fear-based messaging in political communication can influence public anxiety and perceptions of democracy. But how to cope?

Reframing elections: The full set of citizen responsibilities

Whether you are facing election anxiety, or any of the other anxieties of life, taking constructive positive action can be a healthy way to manage and tame anxiety. Regardless of what you hope will happen on Election Day, there can be a certain comfort in knowing that the opportunities for doing good, and making good things happen, will continue to exist in abundance after Election Day, just as they do right now.

We often think and talk about voting as if were the single duty of citizens. But we have more responsibilities besides just voting. This doesn't diminish the importance of voting, or of elections. But it does call us to be involved in non-election years in the constant responsibilities of citizenship:

• Information literacy: Taking the time to understand issues rather than parrot narratives about them. This means spending more time with baseline information and less time with narrative spinners.
• Active problem solving: Getting involved in your community, to give yourself first hand exposure to the challenges of our time and how they are playing out in Main streets and backroads, not just on Wall St and private jets.
• Bringing others along: Help others learn how to be more informed and involved.

Why this kind of constant work and learning is so vital: We may think of elections as point in time events but in reality they are culminations and days of reckoning on previous work done or not. We think of so many things rising or falling based solely on this one day. But what does occur is due to long periods of previous work & investment - or lack thereof.

Citizens who take these responsibilities seriously are less vulnerable to being swept up and misled by political narratives and personality cults. They don't need a hero to save them - they know they are the heroes and they see the results of their efforts. They and the country are more successful thanks to their diligent learning and work.

These highly engaged citizens also are less likely to fall into extreme division and polarization. Working together on issues gives a familiarity and sense of camaraderie that unifies a group of people. Continuous collaboration and learning together provides a setting where people are more likely to adjust their viewpoints and opinions as they gain first hand knowledge of the ins and outs of key issues.

It would be nice one day to see elections where the substantial debates are anchored in the actual realities of the difficult complex challenges we face. Where there is a clear-eyed discussion of tradeoffs. In the 21st century successful democracies will be more like study halls and less like cafeteria food fights.

When was the last time you changed your mind on a significant issue?

Citizens in a high anxiety democracy or season tend to focus a lot on differences of opinion, and frustrations over the seeming inability to get others to change their minds. What are they thinking??? How can they possibly vote for that person??? We ask in frustration.

But it's important to reflect on the times when we ourselves had a change of heart about an important issue. What allowed that to happen? What was the setting?

It probably was in a supportive setting that allowed you to reflect and absorb new perspectives gained over time without feeling insulted or threatened. This change of mind also likely occurred in settings that allowed you to encounter new information first hand and empirically.

Promoting unity and managing anxiety within a team: strategies for leaders

1. Promote Psychological Safety and Transparent Communication

• Action: Cultivate a culture where team members feel safe to express concerns and ask questions without fear of judgment or negative repercussions. Regularly share relevant updates on projects and organizational changes, and provide open forums for team members to voice their thoughts.
• Impact: This transparency builds trust, reduces uncertainty, and fosters a strong sense of unity, as everyone feels informed and valued.

2. Encourage Mental Health and Resilience Resources

• Action: Offer accessible mental health resources, such as therapy sessions, mental health days, and resilience-building workshops on topics like stress management and mindfulness. Normalize the use of these resources by discussing mental health openly.
• Impact: Supporting mental health proactively ensures team members feel cared for, helping them manage anxiety and build resilience, which contributes to overall team well-being and productivity.

3. Model Positivity and Recognize Team Contributions

• Action: Lead by example with a solution-oriented attitude, and celebrate team wins frequently—whether big or small. Recognize individual and collective contributions regularly.
• Impact: Positivity and appreciation boost morale, unify the team around shared goals, and keep anxiety in check by reinforcing a constructive, supportive environment.

These core practices address mental health, unity, and anxiety management, fostering a balanced, resilient, and focused team.

Thank you for reading and sharing S3T! Have a great weekend and a great week ahead.

Ralph