Sundays… and a new week ahead

Introduction

Dear readers,

I hope you had a wonderful Sunday yesterday! Now that Monday is here, let's start the week with renewed energy.

In this newsletter, I'll be sharing interesting posts, stories, and useful tips or recommendations. Let's make this Monday brighter by reminiscing about the lovely Sunday we had yesterday. Wishing you all a wonderful week ahead, filled with productivity, joy, and moments of serenity.

What I read today:

Great thread on layer 2 wars:

Found this interesting article on crypto regulations from the BIS:

Here are my notes:

- The Financial Stability Board (FSB) proposed a comprehensive framework for the international regulation of crypto asset activities.

- The proposed framework aims to address potential risks to financial stability posed by crypto assets, including stablecoins.

- The core components of the framework include recommendations to promote coherence and completeness in the regulation, supervision, and oversight of crypto asset activities and markets.

- The framework also includes revised high-level recommendations for the regulation, supervision, and oversight of global stablecoin (GSC) arrangements.

- The consultation report examines regulatory and supervisory issues related to crypto asset activities, focusing on addressing financial stability risks.

- It provides an overview of international standards and regulatory approaches for crypto asset activities in FSB member countries and regional advisory groups.

- The report proposes nine high-level recommendations for the regulation, supervision, and oversight of crypto asset activities and markets, aiming to enhance coherence, international cooperation, and information exchange.

- The FSB has collaborated with various international organizations to ensure coordination in monitoring and regulating crypto activities and markets.

- The FSB also conducted a review of the high-level recommendations for regulating GSC arrangements, highlighting the need for robust regulatory standards and addressing potential risks to financial stability.

- The review resulted in ten high-level recommendations for comprehensive regulation, supervision, and oversight of GSC arrangements, emphasizing global monitoring, risk management, cross-border cooperation, and compliance with regulatory requirements.

What I saw today:

I really like Rob’s Youtube Channel! He always offers some great insights and learnings!

I also watched the finale of the first season of “Succession” and can definitely recommend watching it, if you haven’t already! It is incredibly exciting, great dialogues and sometimes also a bit funny.

What I listened to today:

Today’s Podcast:

This is for German readers only I guess, but I learned a lot about the topic of “TARGET2”!

Germany's treasure of trillions

Listen to this episode from beyond the obvious - the economics podcast by Daniel Stelter - featured by Handelsblatt on Spotify. In the 197th episode of "bto 2.0 - the economics podcast with Dr. Daniel Stelter" we get to the bottom of the topic of Target2 claims of the Bundesbank. Are these just clearing positions or real, collectible claims? Could we mobilize the funds to invest in Germany's future? And if so, how can we realize this? In this interview, Dr. Hans Albrecht, founder of the investment company Nordwind Capital from Munich. He presents a calculated proposal on how we can leverage the potential of 1,267 billion euros.

Today’s song:

What I liked today:

What I learned today:

I watched this on Youtube. Here's a structured overview of what investors can learn from Howard Marks' insights on navigating market cycles:

Understanding Market Cycles:

• Market cycles are driven by human emotions and psychology.

• Real estate market cycles differ from those of other asset classes because of liquidity and the long lead time for development.

• Understanding market cycles can help investors make informed decisions.

The importance of fundamentals and psychology:

• Asset prices are primarily influenced by fundamentals and investor psychology.

• Positive events lead to higher asset prices, which affect investor psychology and increase risk tolerance.

• When expectations are not met, the market reverses its trend and asset prices fall.

The dangers of market bubbles:

• Market bubbles occur when investors no longer believe that price matters.

• Overvalued assets may continue to rise, but will eventually correct.

• Valuation metrics and investor behavior can help assess market cycles and make appropriate investment decisions.

Navigate market cycles without prediction:

• Evaluate valuation metrics and other investors' behavior to assess position in the market cycle.

• Recognize extreme points in the cycle to change the odds in your favor.

• Avoid words like "never" and "always" in an uncertain market.

The importance of risk assessment and long-term perspective:

• Understand the inherent risks of investment strategies.

• Estimate intrinsic value and focus on buying assets that are trading below that value.

• Weigh the risk of losing money against the risk of missing opportunities.

• Think long-term and focus on the big picture rather than daily market fluctuations.

The cyclical nature of market cycles:

• Market cycles will exist as long as people are involved in investment decisions.

• Don't think that any investment strategy can outperform the market consistently.

• Assets that have performed poorly may be undervalued and have the potential for future outperformance.

Adapt to changing times:

• Success carries the seeds of failure. Remain humble and adapt to changing market conditions.

• Different market segments may become popular, but it is not advisable to rely solely on trends.

Prudence and margin of safety:

• Insist on a margin of safety or margin of error when investing.

• Be cautious when market valuations are high and optimism is rampant.

• Find the right balance between aggressiveness and defensiveness in portfolio positioning.

Focus on fundamentals and long-term values:

• Focus on fundamentals and long-term value rather than relying solely on past performance.

• Experienced investors have a better sense of the opportunities and adjust their strategies accordingly.

• Finding the right balance between aggressiveness and defensiveness is critical.

Random Thoughts:

I explicitly took time today to reflect on certain friendships and whether they are doing me good or doing the opposite. We should all ask ourselves from time to time whether we want to spend our time with people who are energy suckers rather than providing us with added value (in the form of beautiful moments, memories, support, shared laughter or whether we can learn something from them). Our time in life is limited and therefore precious. I have firmly resolved not to waste my time mindlessly, but to consciously choose certain company and activities. Through a self-made decision we act self-determined, mindful and gain a sense of freedom.

That’s it for today! ☺️