Lux Capital: A Message To Young Investors Who Only Know A Rising Market

Johnny HopkinsLux CapitalLeave a Comment

One of the best shareholder letters for investors to read is the one by Lux Capital. In the latest letter there’s a message for young investors who only know a rising market. Here’s an excerpt from the letter:

There’s a relevant beautiful short story, “The Appointment in Samarra”. It goes like this: There was once a merchant in the famous market in Baghdad. One day he saw a stranger looking at him with surprise. He knew the stranger was Death. Pale and trembling, the merchant fled the marketplace and raced far away to the city of Samarra. For there he was sure Death could not find him. But when at last, he arrived at Samarra, the merchant saw, waiting for him, the grim figure of Death.

“Very well”, said the merchant. “I give in. I am yours. But tell me: why did you look so surprised when you saw me this morning in Baghdad?”—”Because,” said Death, “I had an appointment with you tonight…in Samarra”.

Fairness in fate depends on fellow humans. Human agency helps to reward good actors and punish bad ones. At present, systems of sense-making and error correction are overloaded with credulity fueled by greed. Masses have thrown caution to the wind and diligence to the dogs. A once financially and morally bankrupt showman got elected President, set a record for lies told, was voted out of office and then launched a SPAC.

Politics has always been a circus but the tent mostly contained it. Seeing what worked in politics, celebrity CEOs have similarly discarded decorum, traded truth for promotion and rallied crowds and supporters and believers that drowned out critics, and made them too big to fail. A young generation has so far only been rewarded for following pied pipers and has not yet suffered any loss nor gained any learning that will protect them in the future.

You can read the entire letter here:

Lux Capital Q3 2021 Letter

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