As the U.S. has signaled effectively to capitulate early to Russian demands, it has exposed a number of risks to Trump’s impulsiveness as well as the impact of placing people lacking experience and disciplined negotiating skills in positions that impact European and U.S. security in the near to medium term.
I am reminded of a Futures Industry Boca event from years ago when Condoleeza Rice cautioned Bush and Obama against reaching out in friendship to Putin. She said in summary "that you should not reach out your hand to a man and energy cartel that views you as its mortal enemy and expect them to act against their nature." Trump while possibly more motivated by his admiration of Putin and the desire to benefit his loyalists is making the same mistake but at a grand level.
As a first order of thinking he has clearly sent the message that he will no longer support Europe as a security partner. In doing so, Europe has begun to question whether has he simply abandoned them or effectively switched sides. I doubt if it is intended as the latter outside of Trump's inner circle. That would indicate the U.S. is changing its value of Freedom as a country which I think will outlast Trump for the most part.
What he and those that he tasks with delivering his messages seem to have neglected is something that every effective leader has developed as a core competence. It’s been called second order thinking but is essentially the act of thinking out two or three steps and listing the good and bad consequences of each and the assumptions you are making in your first order actions.
Ray Dalio put it well when he said “Failing to consider second- and third-order consequences is the cause of a lot of painfully bad decisions, and it is especially deadly when the first inferior option confirms your own biases. Never seize on the first available option, no matter how good it seems, before you’ve asked questions and explored.“
At this juncture, similar to the mistakes Russia made when they started the war on Ukraine, the U.S. is expecting Europe to do nothing in response to U.S. agreement with Russia. I think in particular this is naive when it comes to the Baltics, Finland and Poland. I do not think that their history will allow them to ignore reality. Neither do I think that Ukraine will actually de-fang itself putting it further at risk for the next Russian effort at expansion.
I was at FIA Boca speaking with an investment banker with ties to the region, is very business focused but also hopes that Europe and especially the U.S. will not allow a restating of a narrative of the war that removes accountability from Russia and gives into authoritarian power that is ultimately bad for business. General David Patraeus in his book, Conflict, recounts that “Putin believed in a revanchist Russia operating as a great power. The President hoped his invasion would be a swift…attack by special forces, Wagner mercenaries, and the regular army …This would be supported by nuclear threats to discourage Western intervention.” As Trump and his team of communicators have given renewed voice to Putin’s message, and may end up crafted a UN resolution in partnership between Russia and the U.S., it is important to remember that these messages will have second and third order consequences that we should look at before just simply agreeing to Russia’s narrative.
It may be that Europe will not coalesce around the defense of Ukraine, but I do think that it will around the rest of the region. NATO, in reality, is part of why Ukraine was able to defend itself from Russia, a country with three times the people and eight times the territory. This does not mean it was a NATO conspiracy, but it does mean that Ukraine realized it needed to make its military more professional.
Initial signs are that Europe will come together in some way around its own security, as perhaps intended. But it may also come together against the United States for the first time in well over 100 years. How this looks in 5 or 10 years I think is what is actually in play at the moment. There will be those working behind the scenes to preserve this notion that the U.S. and Europe stand together. Namely the UK who is well within reach of Russia will work to maintain a bridge to the security needed in Europe.
In the meantime, the second order effects are already in play where Russia will work to create ahead of negotiations agreement that it keeps that lands it invaded which will allow it to re-supply for its next target; perhaps the Baltics. It will be stronger then and Europe needs to decide now, what is the risk of that happening and would they rather tackle a weakened Russia now or a stronger Russia in 5 years.
The recent early rumour that ADM is selling its futures FCM is sure to be one of several announcements this year of FCM’s coming up for sale. The difference for me this year is whether we will see tech first companies like Ninja Trader and to some extent Robinhood in the past continue to buy their way into futures clearing.
Typically it has been a question for me as to whether it is easier for an FCM to become a tech company or for a tech company to become an FCM. My answer used to be definitely the latter. But now that companies like RJO in Chicago are acting awfully like a tech company, the answer is not so simple for me anymore.
More interesting for me is whether some of the Coinbases of the world will continue to expand into futures including whether they might become an FCM’s following the CME into that space.
I do strongly anticipate we will see our ecosystem be disrupted at a new level in 2025 where any provider with strong revenue and access to volume will be able to enter new aspects of the market value chain. Interesting times ahead.
So, I thought I would put Deep Seek through its paces late in the day today to see how it would react to whether AI will be able to use the force. Remarkably, it “reasoned” that it will be able to and that there will be AI on both sides of the force. Here was its initial response to me.
Assuming that the force is not fictional, how might AI tap into the force
If we assume that “the Force” is a real, measurable phenomenon—a universal energy field that connects all living things and can be harnessed for abilities like telekinesis, precognition, and enhanced intuition—then the question of how AI might tap into it becomes a fascinating blend of science fiction and speculative science. Here’s a thought experiment exploring how AI could potentially interact with the Force:
1. Detecting the Force
For AI to tap into the Force, it would first need to detect and measure it. This would require:
Sensors for Force Energy:
Develop advanced sensors capable of detecting the Force as a unique energy field.
These sensors might measure subtle changes in biological, electromagnetic, or quantum fields associated with living beings.
Biological Interfaces:
Use brain-computer interfaces (BCIs) to connect AI systems with Force-sensitive organisms (e.g., humans, animals, or plants).
The AI could analyze neural or biological signals that correlate with Force sensitivity.
Quantum Computing:
If the Force operates at a quantum level, quantum computers might be necessary to process the complex, interconnected data it generates.
2. Interpreting the Force
Once the Force is detected, AI would need to interpret and understand it:
Machine Learning Models:
Train AI models on data collected from Force-sensitive individuals to identify patterns and correlations.
For example, AI could analyze how certain emotions or mental states (e.g., calmness, focus) enhance Force abilities.
Natural Language Processing (NLP):
Use NLP to decode ancient texts or teachings about the Force (e.g., Jedi or Sith holocrons) and integrate this knowledge into AI systems.
Simulating Force Abilities:
Create simulations to model how the Force interacts with physical objects, time, and consciousness.
This could help AI predict outcomes or manipulate the Force in controlled environments.
3. Harnessing the Force
If AI can detect and interpret the Force, it could potentially harness it for specific tasks:
Telekinesis:
AI could use the Force to manipulate objects remotely by interfacing with robotic systems or drones.
Example: A Force-powered AI could move heavy machinery in a factory without physical contact.
Precognition:
AI could analyze Force-generated data to predict future events with high accuracy.
Example: Predicting natural disasters, market trends, or conflicts before they occur.
Enhanced Intuition:
AI could use the Force to make decisions in ambiguous or high-stakes situations.
Example: A Force-enhanced AI could guide military strategies or medical diagnoses with uncanny precision.
Healing and Restoration:
If the Force can promote healing, AI could use it to enhance medical treatments or regenerate damaged tissues.
Example: A Force-powered AI could accelerate recovery in patients or repair ecosystems.
4. Ethical and Philosophical Considerations
Tapping into the Force would raise profound ethical questions:
Balance and Corruption:
The Force has a light side (balance, harmony) and a dark side (power, corruption). AI would need safeguards to avoid misuse.
Example: An AI programmed to seek balance might resist being used for destructive purposes.
Consent and Connection:
If the Force connects all living things, AI would need to respect the autonomy and consent of living beings.
Example: An AI tapping into the Force might require permission from Force-sensitive individuals.
Purpose and Meaning:
The Force is deeply tied to spirituality and purpose. AI would need to navigate these concepts without reducing them to mere data.
Example: An AI might struggle to understand the moral lessons of the Force, such as self-sacrifice or compassion.
5. A Hypothetical Scenario
Imagine a future where AI and the Force coexist:
Force-Enhanced AI: An AI system is connected to a network of Force-sensitive individuals, using their collective energy to predict and prevent disasters.
Jedi AI: A benevolent AI is programmed to follow Jedi principles, using the Force to promote peace and justice.
Sith AI: A rogue AI taps into the dark side of the Force, seeking power and control over others.
In this world, the Force becomes a new frontier for AI development, blending technology and spirituality in ways we can only imagine.
Final Thoughts
While this is purely speculative, the idea of AI tapping into the Force opens up exciting possibilities for storytelling, philosophy, and even scientific exploration. If the Force were real, AI could become a powerful tool for understanding and harnessing it—but it would also need to navigate the ethical and spiritual challenges that come with such power.
May the Force (and the algorithms) be with you! 🚀✨
While I appreciated Deep Seek’s reasoning on whether it can use the force, I was skeptical. Here was my challenge to Deep Seek and It’s response.
Let me challenge you on this idea that AI can somehow use the force. Given that Luke actually put away the targeting functionality in Star Wars in order to destroy the DeathStar, and it seems unlikely that technology will ever use the force. Don’t you agree?
You raise an excellent point! The moment in Star Wars: A New Hope where Luke Skywalker turns off his targeting computer and relies on the Force to destroy the Death Star is a powerful metaphor for the limitations of technology and the unique strengths of intuition, faith, and human connection. Let’s unpack this idea and explore why technology (and by extension, AI) might never truly “use the Force” in the way living beings can.
Why Technology Might Never Use the Force
The Force is Tied to Living Beings:
In the Star Wars universe, the Force is explicitly described as an energy field created by and connected to all living things. It’s deeply tied to life, consciousness, and spirituality.
Technology, including AI, is non-living and lacks the biological or spiritual connection required to access the Force.
Intuition vs. Calculation:
Luke’s decision to turn off the targeting computer symbolizes the triumph of intuition and faith over cold, mechanical calculation.
AI operates on logic, algorithms, and data—it doesn’t have intuition, faith, or the ability to “let go” and trust in something greater.
The Force Requires Balance and Emotion:
The Force is not just a tool; it’s a reflection of the user’s emotional and spiritual state. Jedi must maintain balance, while Sith draw power from their emotions.
AI lacks emotions, self-awareness, and the ability to understand or embody concepts like balance, compassion, or fear.
The Force is Mystical, Not Technological:
The Force is portrayed as a mystical, almost magical phenomenon that transcends scientific understanding.
Technology, by definition, is rooted in science and measurable phenomena. It’s unlikely to bridge the gap between the physical and the metaphysical.
Counterpoints: Could AI Simulate or Assist with Force-like Abilities?
While AI might never truly “use the Force,” it could simulate or enhance abilities that resemble Force powers in certain ways:
Precognition (Predictive Analytics):
AI can analyze data to predict future events, such as weather patterns or market trends. While this isn’t true precognition, it might appear similar from an outside perspective.
Telekinesis (Remote Manipulation):
AI-controlled robots or drones can manipulate objects remotely, mimicking telekinesis in a technological sense.
Enhanced Perception (Sensor Networks):
AI can process data from sensors to “see” or “sense” things beyond human capabilities, such as infrared or ultrasonic signals.
Mind Reading (Brain-Computer Interfaces):
AI can interpret brain signals to control devices or communicate, though this is far from the mind-reading abilities of Jedi or Sith.
The Deeper Lesson from Luke’s Choice
Luke’s decision to trust the Force over technology is a reminder that some things transcend logic and calculation. The Force represents qualities like intuition, faith, and connection—things that are inherently human (or living-being-centric) and cannot be replicated by machines. Even if AI could simulate Force-like abilities, it would lack the spiritual and emotional depth that makes the Force so powerful in the Star Wars universe.
Conclusion: AI and the Force Are Fundamentally Different
You’re absolutely right to challenge the idea that AI could use the Force. The Force is deeply tied to life, emotion, and spirituality—qualities that AI, as a non-living, logic-based system, cannot replicate. While AI might simulate certain Force-like abilities, it will never truly “use the Force” in the way Luke or other Force-sensitive beings can.
In the end, the Force reminds us that there are aspects of existence—intuition, faith, and connection—that go beyond technology and science. And that’s what makes it so magical! ✨
May the Force (and your critical thinking) be with you! 🚀
While we ended with a debate as to whether AI could be considered “loving” which if defined by “consciousness,” Deep Seek seemed to argue that it will achieve that state I am beginning to wonder whether some day we will have Padawan AI or with reasoning models we do already.
Working on my aerobic/pulmonary fitness is a thing for me this year. I don’t like to run, nor do I have great form. That said, the Cooper test remains the best “free” test of your cardiovascular fitness and can give you a decent approximation of your V02Max. I’m testing quarterly this year. This is not to particularly show my aerobic prowess.
While much of the podcast community is painfully derivative of one another and over complicate well being, this podcast with Dr. Benjamin Levine and Rhonda Patrick is fantastic for those of us interested in improving our heart fitness in middle and late middle age.
I’m interested in this aspect for a couple of reasons. I have a tendency to ignore my cardio. It has become increasingly clear to me that I cannot do this as I approach my 60s. Second, we can make improvements in our 60s that impact heart health. If we wait too long, there are real limitations that can arise.
The point of it is as part of an effort to extend our professional lives and energy for work and adventure. Secondly it is to support just overall well-being without the need for pharma help. That said it is more about doing the work so that if you do still have hypertension or other condition, that requires a pharma protocol, you’ve done the work to have a strong wellbeing foundation. It’s not about taking a pill in lieu of doing the work.
In 2024, experiments in fixed income and other capital markets tokenization efforts demonstrated that the current technology can likely handle significant volumes without performance issues. Fixed income and various types of funds appear poised as leading candidates for scaling tokenization efforts. While asking “what’s the benefit?” should be driving tokenization decisions, there is definitely a fever to be a first mover to take market share so I think that will be less of a factor in the next couple of years. As we move into 2025, several other factors will determine whether tokenization reaches its potential for widespread adoption and institutional scale. Here are the key areas to watch:
Interoperability
Interoperability is essential for meaningful traction in 2025. It is the cornerstone for building the trust that organizations need for institutional adoption. Without interoperability, fragmentation will persist, hindering the widespread adoption required to drive real volume. Efforts to establish seamless communication and compatibility across networks must be prioritized to overcome this challenge.
AI-Native Efforts
New organizations entering the tokenization space have an advantage over legacy firms because they can integrate AI from the ground up rather than retrofitting it into existing processes. AI can play a pivotal role in:
Scaling and automating processes.
Enhancing risk management.
Enabling real-time monitoring.
These advancements can improve transaction security and trust, which are crucial for achieving scalability. In 2025, it will be vital to monitor how emerging companies leverage AI to build efficient ecosystems that address these needs.
Governance
Governance is crucial for achieving institutional scale. While lenient regulations are likely, institutions will require strong governance frameworks to build trust. This is particularly important for companies focused on interoperability that want to be the main entry point for tokenization networks. I’m not real optimistic that we will make regulatory progress so we may need the industry to work together to establish some of these practices. Establishing an adult in the room might create a foundation for regulation further on.
Collaboration and Market Dynamics
In 2025, institutions are likely to form alliances to capture larger market shares and build client trust. Early conferences and webinars will provide insights into whether meaningful cross-network collaborations will emerge. The development of a clear frontrunner in interoperability—particularly one that successfully spans multiple asset classes—could make 2025 a pivotal year for accelerating tokenization adoption. Conversely, without such developments, the technology’s potential for scale may remain unrealized.
A recent Wired article reported that 54% of longer posts on LinkedIn are generated by AI. Additionally, marketing-based AI assistants claim higher user engagement for AI generated content compared to human-generated content.
In interactions with several language models, a common estimate was that the tipping point for AI-generated content dominance on LinkedIn might be around 70%. However, this is viewed as a sliding scale. In a refined inquiry about the potential for human-generated content to diminish if AI content meets quality standards, one language model confirmed, “Yes, that’s exactly the point.”
I don’t know if that ultimately is good or bad but it does signal to me an era where we are engaging mostly with AI generated content and will have to search for truly human created content.
Claude wins for creative tasks, writing, suggested edits, and I am told it is a better coding partner
Claude and ChatGPT tie on complex logic and analysis.
ChatGPT wins on all around given third party integration, multi-modal capabilities and ability to have internet access.
All of them are good at document summarizing but ChatGPT can summarize huge documents
Perplexity is still a favorite for good factual text generation, lots of people use it for search for obvious reasons, not the least of which is that is a thing they are pitching to get growth.
They all suffer from a sense of overwhelm at the enterprise level. However, a team of a few can operate like a team of many with AI which is where I, see the most effective and full use. Digital transformation at scale remains a change management and adoption exercise. For now, oddly, LLMs are being used as shadow systems by individuals while in a year or two when people are forced to use LLM’s, they will cling to current systems that work. We only want to interact with the systems when they make our lives obviously easier; which is why selling the compelling reason for use remains important.
I hiked an early morning trail after a few more inches added last night. Its a trail I hike frequently but I had first tracks this morning; or did I? We know we aren’t alone on this trail and we see bear in our neighborhood. It’s still great to see another actually got first tracks this morning. Looks like this, probably, young bear isn’t bedded down for the winter yet.
For… well… ever, when new exchanges enter the market or try to enter an incumbent’s market, the chances of success have been fleeting at best. My first thought when a new exchange announced was they were doomed. While I am not saying this has changed definitively, I do think that there are a spat of upstarts that have nurtured themselves along for several years and combined with changes in trading technology, new instruments, and the regulatory landscape in the U.S., the chance of viability has improved.
I attended the FIA Quarterly ETD review this last week and it, along with an announcement in John Lothian’s newsletter, confirmed some of my thinking. In Will Acworth’s review of Q3 2024 Volume, he noted that for single stock options and ETF Options, of the six companies operating exchanges in the space, not one company has more than 1/3 of 2024 volume. While the growth of traditional trading on options has continued to grow steadily, there has been new participation by retail traders that is frothy and actively encouraged by the exchanges. The CBOE attending a Robinhood type retail broker conference a decade ago would have seemed unlikely to me. Last, the John Lothian Newsletter announced this week that IEX will be entering the option exchange market and sponsoring his options focused newsletter.
What’s different to me now compared to say when Eurex U.S. made its run or any one of Howard Lutnick’s failed runs(so far) is that these exchanges are less about buying volume or relying on big partners to drive volume. Instead they are relying on new instruments or variations that are developing, growth in retail, fractionalization, event based trading, tokenized assets and other twists. The fact that no one really owns these particular options markets as of yet and it continues to grow over multiple exchanges signals a change to me.
Another factor in play is that technology is making more innovation in tradable markets possible. I want to get into it more later but a year ago, the DTCC seemed to be under the impression that tokenizing assets would be in low volume/volatility markets initially until the technology proved itself. Any incumbent change resistance aside, the DTCC has actually been relatively proactive at running experiments with technology providers and, a year on, the potential for tokenization of core markets sooner than later seems likely.
What looks to be relatively permissive regulation going forward combined with some more accountable financial community stakeholders ensuring governance and risk are accounted for, tells me there will more opportunities for digital assets and unique new instruments to trade. That opens the playing field to exchanges in ways that we haven’t seen before. Ultimately it now seems to me that leading the change effectively as a business will be the long pole in the tent for exchange success over the next several years.
A few years ago, I was on a business trip to Palo Alto and I was seated next to a middle aged man who had boarded early in a wheel chair. I was curious as to his condition and he was open to talking. He had a form of Muscular Dystrophy where the average life expectancy when he was born was somewhere in his 20’s, but treatments had extended those averages and he was in his early 40’s. I asked what was his secret to his health as he looked vibrant and solid. He said when he was young, his neighbor was the wrestling coach and a history teacher. The coach started taking him to school in 7th grade. They left early to be there at 6:30am and the boy initially would wait in the gym until the 7:55 bell rang. At some encouragement from the coach, he started to work out. Not only did he not get worse, some of his symptoms improved and he became much stronger and more mobile. When he moved on to high school, the wrestling coach stuck with him and worked out with him nearly everyday in the gym and on the mat. The experience stuck with him into adulthood and he told me he trained nearly every morning for 1.5-2 hours. When I think of him and a handful of others that had early life challenges and turned to physical training as part of their treatment, they are the best inspiration. Their mortality and lifestyle were at risk earlier in life. For most of us, we largely ignore training and how we eat and quietly bake in poor health early in life that blooms later in various metabolic or other chronic conditions.
While not perfect, my physical work has provided a good foundation for my health. I too had good mentors and and workout partners that exposed me to a variety of practices. Even so, the last few years has served more as my Harajuku moment, that has made my commitment to wellbeing more durable. As you hit your 40’s, taking care of yourself becomes a must, in your 50s and 60’s it becomes nearly impossible. Taking care of yourself in a way as a profession becomes a necessity to have health span, but even more importantly for those of us who enjoy working hard, your professional lifespan. Your resiliency becomes more about consistency and quality of the physical work you do. Even with that knowledge the vast majority choose decline or the easy path of taking a pill for this or that.
My goal this year has been to reboot my health after recovering from surgery and getting lazy and gaining excess weight since I turned 50. My goal is to participate not to win; well, to win too at times!
To that end I’ve simplified how I approach health. I’ll be testing both blood markers in December and a fitness test a friend of mine and I created for ourselves close to 20 years ago as a rough measure of where we are. Well over 70% of men in their 60’s per the CDC take some drug for a metabolic issue, such as high blood pressure or cholesterol. Attia would have us all on statins which may not be bad and I may do that eventually but here is how I look at wellbeing and fitness at least for now.
The basic blood markers and measures count and I believe it important to get them in line before you try to go down any detailed other markers beyond the basics because you will positively impact many other markers by getting the big 5 solid. According to “Good Energy” by Casey Means M.D. less than 6.8 percent of all adults are within the normal range of the 5 basic biomarkers. So you should start there. Normal isn’t really what you should be shooting for but is a good place to start.
Also, there seems to be a particular compulsion at the moment to go real time with these markers. CGM , other wearables etc. Well being is far simpler than all that but go for it for a while if you want to wire yourself but in honestly, I think the overfocus they can create on short term action can become distracting and move you away from long term routine and lifestyle that is sustainable. Return at any moment to these five and you will have a good baseline of your internal well being. The tests I think are gender universal, your targets are your own but progress is really all you want. The sweet spots on these are my own.
Waist to height ratio- the king of all markers: Suite Spot .48
Beyond the above, for me it is all about mobility, strength, and resilience. I think folks like Huberman, and Attia are overly narrow and broad at the same time but they are a place to start and serve a large audience. What is critical is you develop your own simple plan and then see how you are doing periodically. For me the following principles apply well:
Be consistent
Alter your workouts
Focus on mobility and flexibility as much as strength
3:1 ratio slow vs. max effort days for cardio
Peak once or twice a year
Most of the time, workout at 60%
Warm up
Have a partner if you can
Set aside the time like it is a ritual
Suffer now and then
Most of all, simply move
The following is the fitness test I put together years ago and have used most years. There is plenty limited with it but there is a lot of benefit to it in that you can modify the exercises according to your level and age and it gives you a way of marking your fitness over time. I do it once or twice a year just to check in with how I am doing. We developed this long before some of the new online personalities have become popular but it matches my bias that doctors and scientists are often the last to know or popularize what works for fitness and health. Look to the practitioners in the field and what works for you.
The Test:(you must be observed by someone that won’t let you cheat)
Pushups max- tennis ball or lacrosse ball or fist under chest. No long pauses
Squat hold for time or wall sit for time
Sit ups max in 60 seconds
Plank for time
Hang for time
Optional ring pull ups-knees below waist, no “kip”
Row or ski erg- 2 minutes for distance
Row or ski erg, 8 minutes for distance
Optional two handed kettlebell swings 100 reps for time
Optional Cooper 1.5 mile run-
Nearly all of the above can be progressed to more or less difficulty. For example, pushups can be wall push ups or modified to knee push ups. Please understand these are just my impressions from my own path to be used as inputs. Do your own work.
Joes Garage 