In Episode 8 of Baekho Talks, we sit down with from Substack, a biochemist and biotech investor with years of research experience, to explore how drugs are actually discovered, what makes biotech investing so difficult, and which technologies could transform medicine over the next decade.

We start with the fundamentals: why developing a successful drug is so difficult, why most potential treatments fail long before reaching patients, and how modern targeted therapies are moving medicine away from blunt instruments toward increasingly precise treatments. Pharma Fox explains antibody-drug conjugates as biological “homing missiles” that can deliver drugs directly to specific cells — particularly in cancer treatment.

We then discuss the investment side of biotech: how to evaluate small biotech companies, why cash runway matters so much, how Pharma Fox thinks about Phase 1 and Phase 2 catalysts, and why measurable biological data can be especially valuable when assessing experimental drugs. We also discuss Abivax, emerging gene-therapy platforms and how he searches for potentially overlooked biotech opportunities.

The conversation also dives into the enormous GLP-1 and obesity-drug market. Can the industry move beyond today's treatments by addressing problems such as muscle loss and weight regain? And where could the next generation of obesity drugs take the market?

One of the biggest debates of the episode is AI drug discovery. Pharma Fox explains why he believes AI will become an important scientific tool but remains skeptical of claims that it will suddenly “cure all disease.” We discuss AlphaFold, AI-generated molecules, the scientific method, the black-box problem and why AI may be more immediately useful for analysing biological and clinical data than independently discovering entirely new drugs.

Finally, we look at what could genuinely change medicine over the next decade: gene editing, precision medicine, targeted cancer therapies and personalized mRNA cancer vaccines. Pharma Fox explains why the ability to design treatments around the biology of an individual patient's cancer could represent a major shift in oncology.

FULL: Anthropic’s Tom Brown Discusses AI’s Explosive Growth, AGI & Medical Impact at G20 | AI1G

Hyperliquid Founder: How to Win in Crypto (by Building for Users, Not VCs) | E95

Building Defense Technologies to Protect Democracies | Torsten Reil, Helsing

Thomas Sowell: Intellectual Thought Leader | With Roland Fryer, Ayaan Hirsi Ali, and Charles Murray

Jeff Dean: The 1% Rule for Building in AI

AI’s third era: the rise of persistent AI coworkers | Tara Seshan (OpenAI’s product lead)

Is Society Just a Giant Body? A Systems Theory of Life

All Things Are Empty - Intro to Madhyamaka Buddhism

The Secret Behind Dostoevsky’s Genius

Why Cowards Reject Beauty | Dostoevsky, Brutalism & Prophecy (w/ Clay Greene - Ep. 3)

How To Actually Unlock Your Villain Glow Up

Hopefully you find that i have good taste in my selections

Remember that as you keep watching
Your brain keeps on changing

Make sure that you become the one

And go on a generational run

Stay watching!

What if consciousness, ancient philosophy and modern science are describing the same reality from different perspectives?

In this episode of Baekho Talks, I sit down with Carl Langley to explore consciousness, psychothermodynamics, Taoism, Hermeticism, free will, nihilism, enlightenment and the search for meaning.

We discuss why the “meaning of life” may be the wrong question, how responsibility can actually create greater freedom, why humans create psychological prisons for themselves, and whether enlightenment is less about acquiring knowledge and more about letting go of what we think we know.

Are markets approaching a turning point?

In Episode 6 of Baekho Talks, me and discuss why I decided to sell my stock positions and why several warning signs are making me increasingly cautious about the market.

We look at the sharp moves in U.S. Treasury yields, rising government debt and interest costs, and what stress in the bond market could mean for equity valuations. We also discuss Russia and Ukraine, Putin, recent diplomatic developments and how a potential peace agreement — or further escalation — could impact European markets, energy prices and defense stocks. On the technology side, we ask whether the extraordinary AI boom could be approaching a near-term top.

Dynasties and Dystopia (from the series Arcane League of Legends)

ny2mia

Beauty and the Beast - Leroy Sanchez & Lorea Turner (Music Video)

Rewrite the Stars - The Greatest Showman | Ni/Co

Mirrors - Justin Timberlake (Boyce Avenue feat. Fifth Harmony cover) on Spotify & Apple

Madison Beer - Glimpse Of Us (Joji cover) in the Live Lounge

YE - BEAUTY AND THE BEAST

aespa 에스파 ‘Armageddon’ MV

Cartoon, Jéja - On & On (Lyrics) feat. Daniel Levi

On and on we go don’t we

A tale as old as time

Beauty and the Beast

Every Reason China Keeps Winning at Manufacturing

Ex-NVIDIA Engineer: Why AI Is About to Get 1000x Cheaper

Nvidia’s Risky Business | Stratechery by Ben Thompson

Vanguard - The 8 Trillion Dollar Financial Empire | 2023 Documentary

Dylan Patel – “Every force is screeching towards centralization.”

Understanding Geoeconomics: How Global Economics Shape International Relations

AI’s Bar Mitzvah Moment? From Hype & Hope to Business Questions!

The Entire Energy Sector Explained: Oil, Gas, Electricity & the Grid

I really can’t believe that all of these videos are for free

You used to have to pay for this information back in the day

This is the power of the age of information

Enjoy, and happy watching!

Episode #5 just dropped on YT with !

In this episode, we sit down with Sam, founder of contain.digital and a digital-transformation professional with nearly three decades of experience, for a wide-ranging conversation about AI and what technological change actually means for people and society.

Rather than focusing only on which AI model is best or which jobs might disappear, we explore the much bigger questions surrounding the AI revolution: how companies actually implement AI, why human behavior is often a bigger obstacle than the technology itself, what happens to decades of accumulated human expertise, and whether AI could ultimately make distinctly human skills more valuable rather than less.

We discuss AI adoption inside businesses, privacy and data sovereignty, Palantir, regulation, the future of work, apprenticeships and the importance of transferring knowledge between generations.

Disclaimer: This post is for informational and educational purposes only and does not constitute financial advice. The analysis, opinions, price targets, valuation scenarios, and upside projections expressed here reflect personal views and should not be taken as a recommendation to buy, sell, or hold any security. Investing in stocks involves risk, including the possible loss of capital.

Welcome to Episode 4 of Baekho Talks.

In this episode, we sit down with from Substack, a former Bank of America employee turned independent investor, to discuss his journey toward financial independence and his perspective on today’s market.

We dive into the debate around value investing versus the AI boom, whether current AI spending and valuations are sustainable, and where is finding opportunities in a market increasingly dominated by technology and growth stocks.

We also discuss his highly diversified portfolio of around 150 stocks, his successful investment in Meta, why he is currently looking at companies such as McDonald’s and On Holding, and how his approach to investing and risk has evolved over time.

Beyond individual stocks, we explore AI economics, OpenAI and Anthropic, competition from China, the potential impact of AI on industries such as insurance, and whether parts of the current AI boom could ultimately prove to be a bubble.

also shares his thoughts on valuation, diversification, patience, avoiding FOMO, investing mistakes, financial independence, and why being willing to admit what you don’t know can be one of the most valuable qualities an investor can have.

Towards the end, we discuss Charlie Munger, investing books, the democratization of financial information, and whether independent traders and investors could become the next generation of financial influencers.

Suit & Tie (feat. JAY Z) ([Radio Edit])

question mark (Feat. CHOIZA Of Dynamicduo, Zion.T)

하루하루 (Haru Haru)

sdp interlude ( extended ) x MY EYES ( second part ) - Travis Scott *BEST VERSION*

BURN - ¥$ ( BEST EXTENDED VERSION) + STRONGER MASHUP

RICK ROSS - DEVIL IN A NEW DRESS

METRO BOOMIN - “Superhero” x Scarface **EXTENDED VERSION

Lose My Mind - (F1: The Movie)

Tony Stark • Starboy (The Weeknd)

The truth is

I am Iron Man

An Overwhelming Advantage: Resonant Sciences and a New Era of American Defense | Joby Recon Ep. 05

The $2.5B Drone Company Trying to Become the Toyota of Defense

Tariffs, DOGE & Fixing America: Peter Thiel’s Skeptic Solutions

What Comes After the Chip Trade? Tom Lee on AI Agents

Sergey Brin Retakes Gemini, 4 Labs Lose Containment, Compute Trades at NYSE w/ Kush Bavaria | EP 278

Why the Markets Are Pricing AI Wrong | Gavin Baker

Inside Travis Kalanick’s Wild New AI Company

Everyone Is Still Undersizing the AI Market | Eric Vishria

Which Companies Bill Ackman Is Bullish and Bearish on Right Now

Whew!

That should be enough YouTube to keep you entertained for the whole week

Happy Watching Everyone!

Marc Rudajev is currently on the Board of Tron Dao and he has had a storied 20 years career trading on Wall Street. From an Executive Role at Morgan Stanley, to trading Emerging Markets in Hong Kong, to finally settling down as a teacher in England, we asked him questions on a broad range of topics and really picked his brain.

Hopefully you enjoy learning from Marc, just as I and my cohost enjoyed the roughly hour and a half that we spent together!

Finally,

Make sure to like, comment, and subscribe

And if you ever want to join an episode and get interviewed my DMs are always open!!!

Transcript

BAEKHO

One, two. All right. So, this is Baekho Talks episode number three. So, this is Baekho.

I’m here with 10X Ideas and Mark from Learning, Investing, and what was the last part?

MARK

Thriving, the most important part.

BAEKHO

Yeah. So, yeah, we have a really exciting episode ahead. we prepared a bunch of questions as well. So John, why don’t we just get us started?

JOHN / 10X IDEAS

Yeah, for sure. So yeah, Mark, first question. What originally attracted you to finance and what was the biggest surprise when you first started working at Morgan Stanley?

MARK

Well, I so I went undergraduate and I got a degree in accounting, which I think accounting for anyone who’s starting out into business is a great great platform because you learn really about the basics of a of a company. You break down the balance sheet, the income statement, cash flow statement. You learn about various accounting tricks that some companies can use to spruce up their their numbers. And then I joined JPMorgan straight out of college.

But I was in their internal audit or internal consulting program, which was a great first job, 22 years old, making, you know, obviously not much money compared to what people make now, but, you know, a decent amount for a for a young grad. But I soon found out because I looked at the various areas within JPMorgan that I really wanted to be on the trading floor. Investing, trading stocks was really what got me my juices flowing. So then I after a couple years I left JPMorgan and went to get my MBA at the University of Chicago and when I graduated there I knew exactly what I wanted.

I was focused on getting back onto the trading floor investing and was lucky enough to land a job with Morgan Stanley. and actually the Morgan Stanley job was based in London because as I was telling you before we started recording, I actually grew up in France and my mom was still living in Paris and this was in the late ‘9s. And what was happening then, which was super exciting, was the advent of the euro. I don’t know if you’re probably a bit young to remember that, but you know, there used to be different currencies. You would have used the Deutsche Mark.

I would have used the French franc and others would have used their currencies. But in the late 90s, early 2000s, they obviously merged to create the euro. And so I thought being in London, New York is obviously the hub of finance, but London for Europe and actually globally was growing tremendously. And I thought it’d be a great time to be here, plus closer to my mom who obviously was getting older.

So I came and joined Morgan Stanley in London on the proprietary trading side. So I joined the equities floor and we just basically managed Morgan Stanley’s own proprietary capital. and I guess one of the biggest surprises, so when you start at one of these big firms, there’s a massive indoctrination program. You know, we all got the tattoos. no joke, no tattoos. But, you know, we all went through the training program together and it didn’t matter whether you were staying in New York, whether you were coming to London, going to South America, going to Asia for about three to four months.

We were all in New York, all the young MBAs who had just graduated that summer. And we had all these senior people from Morgan Stanley come and teach us about the firm both from finance, the way Morgan Stanley sees it, plus also just the Morgan Stanley way. And I think the thing that the biggest surprise was just the variety. You know, I had worked in New York before, as I explained at JPMorgan, and I was used to this New York finance, I don’t know if you want to call it finance bro, but you know, it was a certain certain stereotype that one has.

But once I got to Morgan Stanley, it was people of all sorts of backgrounds. You know, of course, a lot of MBAs, a lot of finance backgrounds, but we also had people who had studied mathematics, had studied psychology, had studied English, you know, foreign languages, things like that. And they were all coming together. And obviously nationalities, I can’t remember the exact number, but it was a tremendous amount.

And so I thought that was something that I hadn’t expected. I was thinking it’s all going to be, you know, people from the Northeast and a couple from maybe the international people from London or from Tokyo or from Sydney or Frankfurt for you Germans. But no, it wasn’t that at all. Of course, there were a lot of those, but there was a mix.

So, I think that was really the biggest surprise of it all in terms of just anyone can really make it in the in this industry. It’s not you don’t have to have studied accounting like I did or economics or finance or you can you can obviously make it with whatever background as long as you’ve got some I think the biggest thing is you need a bit of curiosity and just willingness to learn because as I’m sure the two of you know very well it’s really a thing about it’s a puzzle. We’re trying to solve puzzles really and so all sorts of backgrounds are used to probably get to the correct solutions hopefully. Yeah.

BAEKHO

So, a quick followup on that. what what was it about that experience at Morgan Stanley, you think that made it such a diverse group of people?

Do you think it was mainly the fact that it was in London as like kind of a more international financial hub or that it was like Morgan Stanley itself, which do you think played a larger like role in that?

I mean, obviously Morgan Stanley is the best. Goldman Sachs is second best. No joke. But clearly Morgan Stanley being a highly regarded firm did attract you know highly talented and various sets of individuals.

But I think J you do touch upon a great point. Whereas the trading floor in New York is largely Americans. We had a lot of Canadians, a lot of people from South America as well because a lot of times you would trade Argentina, Brazil and Mexico from out of New York. But yes, it’s true that the London office was probably more diverse than than the other offices because it was a whole host of European.

MARK

So when you’re sitting on the trading floor, I would be speaking French with one colleague. I’d hear Italian and German and Dutch and English every now and again as well. So it I think that certainly played into it but it’s also we had a lot of Indians, we had a lot of people from Southeast Asia and actually what I didn’t mention earlier was after four years I was asked to move from the London office to the Hong Kong office and at that point I had only been to Tokyo a couple times but that was really my only experience with Asia but we had a group that was global in nature. So, I was in London.

We had a team in New York. We had a team in Hong Kong. And one of the people in Hong Kong resigned, and my boss in London said, “Mark, would you consider moving to Hong Kong and heading up our little group there?” And I thought, “Worst case, I’ll go there for two years, and then I can go to Bali and Japan and Korea and just have a few nice vacations.” And the next thing I knew, I spent 12 years in Asia. So but the Asian office was also very diverse in terms of obviously a lot of Hong Kong Chinese people but we had Japanese, we had Indonesians, we had Filipinos and all these types.

So it’s true that being in the international offices by definition you’re going to get get a little bit more variety but even New York you will get variety. So I think it’s just a thing that just like universities you know top universities whether it’s in the US or here in the UK attract the top talent from all over the world. I think these these banks the top banks attract the top talent from all over the world as well. So it’s a it’s a natural thing.

Plus I think the banks just like universities they want a diverse student body. I think the banks want a diverse u body of individuals because if everyone thinks the same obviously that’s not going to serve the company well in the long term I don’t think. And what was like your daily doing like did you have like an assigned kind of equity that you had to trade or were you trading currencies or was it like super diverse?

Yeah. So we were based in the equities department. We were actually within the equities derivative group of the equities division. So our main focus was equities.

But what would happen is because we were trading multiple countries or equities that were listed in multiple countries hence in different currencies we did have to take currency views into account because obviously they could impact the returns just exactly what happened last year in the European markets. They did well but another reason they did even better than the US markets was because the euro strengthened or seen otherwise the dollar weakened. So you have to realize okay the dollar against the various currencies can either add or subtract take away from your return. So you have to take that into account. so there was that and we would also use derivatives as well.

So we would use options strategies or swaps to to sometimes implement the trades. So even though we were basically mainly equities, you know, at the margins a little bit of FX, a little bit of derivatives and obviously like for example, I took a big interest in commodity stocks. that just happened to be something that I I just enjoyed. So even though I wasn’t trading gold or oil directly, I was involved in a lot of stocks that were gold explorers or oil explorers. So I had to have a view on the underlying commodity markets as well.

So it was really a nice varied experience both from a country perspective and an asset perspective. So it was really nice that way too. Nice. And so after over 20 years in equity trading, investment banking and hedge and hedge funds, what made you decide to kind of step away from that world and focus on educating and sort of yeah transitioning to a new phase in life?

Was it I don’t know you made enough money and you decided to kind of Yes, it’s you have it spot on there, John. Teachers don’t make much money and so as a result I decided yeah the tax bills were too high. no. it was a mix of things. Part of it was I always thought about teaching even when I was at university. I had done some tutoring on the side.

So, I taught some mathematics and some French to get a little bit of extra pocket money. so it was always something that I enjoyed doing, educating, but I had this more more important passion which was the finance side of things. But after 20 years I’ve been living in Europe for four with my stint in London and then for a dozen years in Asia and I from a personal perspective I had a couple kids. my wife at the time was American. So we decided we wanted to move back to the US and at that point I didn’t really want to go back to New York. So I thought okay if I’m going to make the change now’s the time to go into teaching.

So it was a big big decision but I had to go back. I actually went back to university at the ripe bold age of 41-42 to get my masters of education because to become a teacher. It’s a bit difficult to just walk in. I assumed, hey, I’ve international.

I’ve lived around the world. I’ve traded millions and millions of dollars worth of equities. You know, any any school is going to want to hire me. But it’s not the case.

Schools are a bit bit picky in who they can hire actually. So I went back got my masters of education and then started teaching at a middle high school in Los Angeles in 2014. So it was a it was a mix of personal choice but also something that I a passion that I had that I just put on the back burner until until I hit middle age as it were. So maybe it’s a middle-age crisis.

JOHN / 10X IDEAS

I’m not sure. How was how was it like combining your personal life, family and everything with the job because obviously working in trading and finance?

I think that can obviously you know be quite time constraining, right?

How was that you know combining your personal life?

MARK

You know, it’s interesting because so you I mean we’ve all been to school, so we’ve all have some good experiences with teachers and some maybe not so good experiences with teachers. what’s interesting is so I worked in LA at a school there and now I’ve been in London teaching at a school here in a British the school here is a typical 100% British system and I can remember my high school days in France and so comparing the US to the European at least I’m not sure about Asia but I can just imagine in the US the teachers are a bit more you know that it’s a bit more relational with the students in terms of I’m not going to say every teacher does this, but I would say the better teachers try to do this. So in my case, I’m a math teacher or a finance teacher. So I’ve got the subject matter, but bringing in the personal side and in my case, I can talk about a story about how I traded a certain stock or what happened when the Brexit vote occurred or when the euro was created or when there was a, you know, the internet bubble burst in 2000.

And so to bring in those types of stories, I think the students really appreciate it. You know, it’s it’s it’s something that you might remember from when you were in school if you had some teachers who were just okay, we’re doing mathematics. This is how you do the derivative of a of a polomial. That’s the rule.

You bring down the exponent, etc. Yes, that’s something that’s necessary to pass the test. But in terms of really trying to get get beyond it and to get why are we doing this, I try as much as possible to bring this story. So that’s certainly something that I think has served me well and based on the feedback I’ve gotten from from the students and their parents over the years I think they enjoy it as well.

BAEKHO

Yeah. So I actually have a question about like the education system there. So, I know that in like the US, for example, for college admissions, like kids just like basically they extract they stack extracurricular activities. They’re pretty meaningless. and then and then they just suck up to teachers and give them gift cards during like the holidays. they shotgun like a bunch of Ivy League universities.

That’s how it kind of works the higher levels of like college admissions. And I just know that cuz I went to a magnet school in New Jersey where a lot of kids did end up going to like MIT, Harvard or all these like big name schools. I know that in England for example, it’s very different where people take prepare for these A-level exams. They’re specific and they have more limited choices for like who what they can apply to.

And like let’s say if you’re applying to Oxford or Cambridge, a lot of the times you have like exams specific to colleges like which system do you think actually makes more sense cuz I think that like both obviously have their own like problems but one probably is better than the other, right?

So what are your opinions on that?

MARK

It’s a great great question and to be honest I’m not sure because you’re right in the US there’s a they call it a holistic whole body of work and the other big difference is in the US we use what’s called a grade point average. So the last four years of your high school or the four years of high school, you know, what you took when you were 14 in freshman year or your first year of high school counts just as much as what you’re taking 2 three years later. Whereas here in the UK and I know in France and maybe John you can elaborate a bit what how the German system is you know we take an exam balorat exam in France or here in the UK as you rightly point out the A level. So what you did earlier matters in terms of getting you ready for it, but in terms of your grades really doesn’t matter because it’s all about how you do on that test at the end of at the end of your senior year or last year of high school.

So there’s pros and cons to both. I would say that the advantage for me as a teacher, I know what I need to teach towards here in the UK because there’s that test, there’s the A-level test, we have a whole 20 years worth of history with of past exams. So we know what sorts of questions tend to come up over and over which subjects are are more important than others and or topics I should say and so you know where you’re going towards whereas in the US unless you’re taking what’s called the AP which June you probably know very well John you may not know it’s called advanced placement so that’s a national test that if you’re taking AP economics or AP calculus it’s the same whether you’re in New Jersey in California or in Alaska there when I taught AP statistics for example, I know exactly what to teach towards because there’s a test. But if I’m teaching a regular statistics class or regular algebra class in theory, yes, I’ve got a book and I know what I should be covering.

But if I don’t end up covering it all, it’s not the end of the world because there’s no big test at the end of the term or end of the year that everyone’s taking. So, it’s it’s a trade-off. I think there’s obviously a lot of stress in both places. I’ve seen obviously students, you know, and I you mentioned it at your high school, you know, get overly stressed in the US, but obviously they get stressed here as well.

What I do find is that the name level the big difference is I find that the name levels of the universities whereas in the US we all sort of know the Ivy League schools or Stanford or these big you know very highly regarded public schools like Berkeley, UCLA, Michigan, University of Virginia, University of Florida of course you know are are highly selective and they and that’s those are the schools that are better whereas I find here in the UK yes Oxford, Cambridge, you know everyone agrees They’re they’re two of the finest, but we have a lot of students that just are happy enough to go to these schools that unless you live here, I’m sure the two of you wouldn’t really know much about. And yet, I teach at what is regarded as one of the better schools. It’s been around since 1557. So, we’re talking, you know, 400 almost 470 years.

And we have students that go everywhere and they all they don’t seem as stressed if that makes sense from that perspective. So from that perspective I would certainly say it’s better because look you can be a super success whether you go to you know University of Florida or if you go to MIT and same thing you could also be you could not do well whichever school you go to. It’s really what you do with where you end up with right and so as a result I think that’s the most important rather than the name on the on the diploma really. Yeah, I would agree.

BAEKHO

And like the reason I mention it is because I remember back in high school, we had there was a guy in my class. So I was in like the highest like place class cuz we took exams when we started high school because it was like a specialized magnet high school. He was a USAJMO qualifier back in eighth grade which means he got to the highest one of the highest stages of the mass Olympus in 11th grade as well. A very very like brilliant guy. he was denied from all the colleges in the US cuz like he just didn’t really like try that well in his essay or just messed up his college.

But then he got into Oxford for math which is like it’s so stunning to see like the comparison there right where he gets like wiped out on US college admissions but in the UK where you just take the test it obviously shows that he’s really talented. So I don’t know I know I know from I’m South Korean myself so I know about like the suiting system. Obviously that system’s pretty broken too. It’s caused a lot of suicides and stress but I don’t know.

I think that the UK does kind of like the more happy medium where it’s less stressful, but it’s still meritocratic at the same time. Yeah. So, yeah, that’s just why I thought it was like a pretty interesting thing to bring up. Yeah, I do think you’re right.

MARK

From a from a student well-being perspective, the UK system from that perspective does does seem a little bit better. plus obviously, what we’ve had in the US over the last 10 to 20 years is what’s called great inflation. So, you know, everyone’s getting A’s when, you know, when I was in high school, I didn’t go to high school in the US, but in college, you know, we weren’t all getting A’s in college, but now what are the statistics that some of these elite private schools, it’s like 60 70% of students are getting A’s, which you know, can’t be the can’t be the case unless the teachers are just being overly overly generous, which seems to be the case. Yeah, I think it’s like more reflects a trend where like the colleges became more of a product more like a big specialized like white glove service more than anything. So like the teachers are just incentivized to be nice. yeah, I don’t know the trends will probably flip in the other direction at some point.

But it’s gone to the point where even college is seen as like this like almost time to stack up credentials and extracurriculars as well in the form of internships and people just like stacking up like they just do clubs that they don’t care about. They do like you know all these side projects that they don’t care about all to get like good internships that they don’t really care about as well. So, so it’s a pretty So, do you see this like structure starting from high school actually were starting to reflect this upward in college which is pretty interesting but yeah. Yeah.

JOHN / 10X IDEAS

Yeah. Mark, so you said that you had like even a sign from the Wolf of Wall Street. without like naming names or whatever, what’s like the craziest or funniest story that you’ve experienced during your career working in trading and finance?

MARK

Okay. Well, the disclaimer is I’m old, right?

So, I can even remember when I started I’m not going to say this is the craziest or funniest, but just to give you a little bit of a of a setting, I still remember people smoking on the trading floor. Okay, so that obviously went away pretty quickly by the mid to late 90s, but early on people, you know, they’d have their cigarette little ashtray. So that’s kind of a of a weird one, but from a from a funny or or crazy story. So nowadays we’ve got every you know things have baekhome way more automated than they used to be.

Back in the day was very much you know we obviously have computers and the and Bloomberg exist and all that all that but a lot of the checks and balances that would just be totally we wouldn’t think twice about it today back then didn’t exist as much. And so it didn’t happen to my bank. I was at Morgan Stanley. But I remember being on the trading floor one day and I told you that I one of the areas I focused on was oil or commodities.

In this case, there was a trade one day that all of a sudden we saw this is in the UK, a stock that all of a sudden started spiking up with a bunch of trades. It was a small cap name that normally wouldn’t trade that much every day. And all of a sudden it just started moving way up and there were way more trades than normally would happen. So of course you’re trying start trying to think what’s the rumor you know is there a takeover new management they strike oil whatever it was.

What we found out the next day was that at one of the banks there was a dealer who actually somehow put his elbow on the keypad and it happened to be on the buy buttons of the keypad and literally it created I think five six00 trades that caused this to go up and they ended up losing a bunch of money because obviously it was trades that they didn’t want to do. So then they had to unwind it. But it just really made you realize that back in the day things like this could happen. You hear stories, again, this is before my time, of people writing writing a ticket.

So you’d write a ticket to buy X amount of shares. And sometimes you’d either not put enough zeros or put too many zeros. And again, the same thing would happen. If you didn’t buy if you didn’t put enough zeros, that means you don’t buy enough of it.

And if you’re doing it for a client, they could be really upset because they wanted to buy X amount and you only bought onetenth of it or 1/100th of it. So then often times you would be on the hook for it or the bank would be on the hook for it or vice versa. If you put an extra zero or two, you ended up buying 10 or 100 times more. So these things happened, but this yeah this elbow on the keypad that was I’ll always remember that because it was like wow was something that nowadays would you know you wouldn’t think could ever happen.

But then for me personally, I’m not going to say it’s the craziest or funniest, but it was the most one of the things I still remember. So I was in the 99 2000 bull market. Obviously brokers made a lot of money because even though the market went up and then it went down, there was a lot of trading and brokers what they don’t care so much about the direction, they care about volumes, right?

Because they’re they’re they’re making their couple cents or percent off of each trade. So, one of the brokers we used in Italy, that was, you know, we traded a lot of Italy, back then, really made a lot of money off of us and all their clients. So, in 2001, they invited us to the Grand Prix in Monaco. So what we did was this is the time the one time where I felt like I was you know cool and James Bondish.

We ended up going down and stayed just outside of Monaco. I don’t know if you’re familiar with the south of France and in that part of the world but there’s a city called Saint-Tropez which is you know quite quite you know hip and even back then but certainly even today glamorous nightclubs blah blah blah. So we end up staying there, but unfortunately the south of France there’s only a couple roads that lead from Nice Monaco to Monaco or from Santa to Monaco and so we end up taking a helicopter. So we took this helicopter.

So I literally felt like you know on the Sunday of the Grand Prix we’re taking the chopper from Saint-Tropez to Monaco. We land on some helipad. The broker had rented an apartment just overlooking one of the main strips of the of the race. you know and then we’re there and food, drinks, we could go out on the balcony, hear the cars, see the cars, you could go back inside, watch the TV of the race, hear the commentaries. It was you’d see the yachts on the in the port.

It was Yeah, I felt I felt like u and I was quite young still back then, you know, it was my first few years in the market. So, today that’ just be old news. I wouldn’t even think twice, but back then, no, I’m joking. Even even today, but for me, that’s always something.

And actually, as it turns out, just this past June, I went down to Milan with my wife and I ended up seeing that broker. He’s still working for the same brokerage firm and it’s gone through a few iterations. There’s been some mergers and the like, but he’s still working basically for the same broker 25 years later and he’s been there 30 years and u and yeah, we still to this day talk talk about that story. So for me personally, that’s one of my most most crazy stories because you don’t it’s not something that you do too long.

JOHN / 10X IDEAS

Nice. So and like you’ve spent obviously like over 20 years in the markets and you’ve experienced the financial crash in 2008 and the dot-com bubble in 2000. Yeah. and then the COVID crash and 2000, right?

So, what’s the single best like investing lesson that you’ve learned and that most retail investors don’t really look at right now?

MARK

I think for me the one thing that I’d say, you know, most retail investors, they really want to trade. They really want to get involved. But I would say the most important lesson is sometimes less is more or not doing not doing something might actually be the best decision. So, I don’t know if you found that to be the case.

Now, of course, you’ve got some people who’ve got these automated trading systems and so they’re really just doing swing trades and their goal is to, you know, do small amounts of gains, but yeah, at tight levels. And so, as a result, you end up making okay money over time. But for most retail investors, that’s not what they do. most retail investors are picking stocks or picking whatever instrument ETFs and the like and trying to, you know, make money on the way up or if they’re able to short on the way down. But so what I found is really the less you do, the better off you can be.

And what really struck me was one time there was a gentleman by the name of Marc Faber. Have you heard of Marc Faber of the Gloom, Boom & Doom Report?

Unfortunately, no. I don’t think I’m maybe I’m not old enough for that. Yeah. Yeah, you’re definitely not alone, June. so he must be, this is a gentleman probably in his 80s now, and he’s a Swiss gentleman, but he’s been living in Thailand for at least 40 years now, and probably longer than that.

And he’s made his name in 1987 because he correctly was able to get out of the market and short the market before the October crash that year. And so hence he now has a newsletter called the gloom boom and doom reports and he also does the circuit. You know he’s on the various TV shows on CNBC, Bloomberg etc. but he also does conferences. And so I was at a conference and this is early 2000s.

And he got up and spoke to, you know, this room of like a couple hundred of us. And he said, you know, if you had just made four trades over the last few decades, you probably would have made more money than most people who try to trade on a regular basis. And so he said if you had bought gold in 1970, sold it in 1979, so you held it for 9 10 years, obviously gold was pegged at $35 an ounce. Then it deped in 71 and then it went on its great run.

And then if you had bought the US market in 1980 to 1989, that did really well. Or actually, sorry, back then was Japan. if you had bought Japan and then the US market and then he just went through that every decade. Now obviously no one’s going to do that. No one’s going to buy on Jan one of the first day of the decade, sit on it for 10 years.

But the idea did did hold that if you can really get a long-term trend. The less you do, the better off you are because it’s it’s this great feeling that we all want to trade and and scalp and make money. And I actually wrote about this in a episode not too too long ago about for people of your generation who are a bit younger than me. Sometimes you might want to have a period where the markets pull back because it allows you to accumulate stocks or whatever asset you’re you’re buying you’re interested in at lower levels for a long period of time.

And then 5 10 15 years later when the markets do resume their upward trend which inev inevitably they do then you averaged in at very nice levels rather than the market going up up up and you’re being forced to buy in at higher levels. So I’d say less is more is really something that most retail investors don’t appreciate. But that being said, I mean what do you think in terms of you know you’re you’ve been retail investors I think most of your life. So what what’s your view on that?

BAEKHO

Yeah, I mean I can comment on that for sure. I mean that lesson is definitely something that I’ve just learned just from like personal experience where I remember like probably well this is like after around two to three years of trading because I started trading around ninth grade of high school like just using my parents brokerage account. but like I think I think I bought pounder around like 11th grade. to dust. This was around like five years, four to five years ago. and I just bought it and I just completely forgot about it. I mean, I mean, I knew it existed. but I was just busy with college and I didn’t feel like trading stocks.

It just wasn’t really something in the in the back of my mind. And then I check it like in my junior senior year of college and then it’s up basically like 10 times and I just did not touch it at all in that time period. And the fact that I just because in the like there were fluctuations where it lost a lot of its value where it was down like probably like around like 50%. and there was times when it was up a lot too like up like maybe like three or 5x and then if I was like really interested in the markets at that time I would have sold. Yeah.

So I think the fact that I just didn’t care about it was what actually led to me getting that 10x like 10 bagger as as they say in a lot of like different books or like in popular terms. So yeah, I just think like a lot of the times retail investors needs to just like do the investment and just log out the account and don’t touch it and just don’t even look at it, right?

Every day. Exactly. That’s exactly right. Yeah.

JOHN

I also think like one big lesson for me has been like kind of putting emotions aside because I remember like Meta for example they were crashing like 30% after their earnings report in 2022 and you know Mark Zuckerberg he was spending billions and billions on the metaverse and then they were going free cash flow negative and then the entire company had like a 250 billion market cap which obviously was still ridiculous because they are like a monopoly in the social media industry. So like basically I kind of knew that the market was like overreacting and then obviously it hurt because like my stock was down so much but you know I decided to hold and then you know obviously the company recovered the earnings recovered and now it’s again the same idea the free cash flow is dipping again but I think like if you believe in the long-term vision then it’s it’s it’s also best like like we said before just to kind of hold and forget about it. yeah, but right now like especially like with our generation, I think the trend is really like index investing. especially like with the you know with the new brokers that make it like super easy for everyone to invest money. do you think that’s like the best strategy to outperform like stock picking to go with an index?

Because personally like I enjoy you know investing in separate companies but in order to hopefully outperform the market which you know in a bull run is obviously possible but then in a bear market often it’s there’s a high volatility. Do you think like young investors should just put it in into an index or should they kind of look to outperform the market with individual stocks?

MARK

Well it really depends on your your interest level. Not everyone is necessarily interested in finance or investing and it depends on your time that you have to devote to this. So obviously if you invest in so Jun’s story was great you know he bought a stock Palantir didn’t look at it for five or so years and the next thing he knew it was up 10 times which obviously allowed him to outperform virtually everything during that time period except for maybe had he been able to buy into SpaceX but that’s a different story. and so that’s that’s obviously the best way of going about it. I think we all agree, but in reality is we can’t all do that or we don’t all have the ability to do that.

So I would say if you had some money to invest, I would definitely put a core amount into both index funds and maybe a little bit of just safety money. you know, in terms of some high yielding accounts that right now you can probably get four to 5%. So, if you had a $100, let’s say, put maybe half or twothirds of it in a mix of index funds slash just some high yield, you’re not going to make that much money, but you’ll make a little bit of money and you can sleep on it. And the other thing is not don’t just focus on the US. Obviously the US still the biggest market still some of the best companies in the world you know obviously the leaders in AI these hyperscalers max 7 type of names but you know what there’s a lot of great companies in Europe there’s a lot a lot of great companies in Asia South America so maybe have a smattering of international funds thrown in there and the key point there is I literally just yesterday saw someone saying well why would you invest in index funds if they make you quote unquote only 8 to 10% a year but after fees you’re only making six and I posted or I replied, this was on LinkedIn.

I said, if you’re making 8 to 10 but only keeping six, that’s your first mistake. You definitely want to focus on lowcost index funds where if the market’s up 8 to 10, you’re basically keeping 8 to 10. And using Vanguard and a lot of other alternatives, you can definitely find index funds where the fees are three to five basis points. So that’s that’s great.

So I would say a core of that, half to twothirds, have it there. then you might want to put a quarter of the money. So, a little bit of money into some things that are a bit more high- risk in terms of maybe buy some of these tech names, NASDAQ names, maybe some commodity names if that’s of interest to you. So, do something that’s that’s a little bit risky. But again, there you can buy ETFs.

So whether you’re have the time to make the difference between us, SanDisks, AMD, Nvidia, Linux, or or you just buy the DRAM ETF, the same thing for gold names, whether you have the time to pick the individual gold miners or you just buy a gold ETF, but you know, it’s going to be a bit higher risk. I’d have some money there. There’s also a thing called a TQQQ, which is a levered NASDAQ ETF. So you know the NASDAQ on average does really well and it’s highly highly exposed to these names but obviously can fall more than the S&P as well.

So that’s a bit higher risk and then if those if you really have the interest then definitely have a small portion maybe 10%. And that can be your trading account. You realize, okay, you may make money, you might lose money, but that’s where you learn, you know, you make the mistakes, you do the research, you you talk to people, you read, you listen to podcasts, you learn about what’s happening in AI or what’s happening in the semis or what’s happening in whatever industry, the optical space or whatever is of interest to you. And there you try to make the money you know, work a little bit higher for you. you know, it’ll be more more labor intensive because you’ve got to be more on top of things, quarterly earnings and the like, but I think yeah, definitely have that.

So, you basically have this barbell approach of the majority is slow but steady wins the race, a little bit more speculative again, but keep it maybe on the safer side to speculative by using ETFs, but involved in some more, you know, highly levered trends to what’s happening. And then if you’re interested, if you don’t just then collapse that into your more highly speculative ETF basket and that way you don’t have to worry about individual names of oh they reported earnings and they disappointed and things like that. So it that sort of depends on your interest level and your time that you have to devote to this. if you have a full-time job, if you have a family, couple kids, they get sick, you have to go on vacation, see the in-laws, things like that that you may not have the time to follow it as closely. But if you’re single or it’s something that you’re really truly passionate about, then by all means, you should definitely have some of it involved in something a bit more high-risk where you really learn.

And who knows, you know, maybe that’ll pay off. And I view I view crypto a little bit that way. I don’t know if you’ve got views on crypto, but you know, it’s obviously not for everyone and no one I don’t think anyone should be putting in 100% going all in on on Bitcoin or on Ethereum or certainly not on altcoins. But to have 5 to 10% of your assets involved, why not?

Even if it goes to zero, which I doubt it will at this point, but even if it did, the other part of your portfolio should still do reasonably well over time. So, it’ll way overcompensate. And who knows, maybe it does go up 10 times. I just, you know, some people are saying Bitcoin should be at a million or whatever, obviously not tomorrow or not next year.

But if you do get it right and it goes from 60 70,000 even if it only goes only quoteunquote to 500,000 that’s almost a 10 times from here and that 10% becomes a very important portion of your of your portfolio. So I would definitely recommend that sort of allocation to anyone who’s who’s looking to invest. Yeah, that makes a lot of sense. you actually yeah you mentioned international index funds for example I thought that was interesting because for me personally I’ve really been mainly doing in the focus on the US markets I’ve never really touched in international stock except I think Shyundai back in the day because Hyundai acquired I remember they acquired the robos dynamics yeah and then I saw that and I thought that was really interesting and I had like some knowledge of South Korea so that’s why I just decided to invest in Hyundai back in the But other than that, I really they’ve never really really studied or or really invested in any international stocks.

JOHN / 10X IDEAS

For like the like average investor in the US who’s not like employed in like Morgan Stanley or or JPMorgan or somewhere like that for example, then what’s your advice to them on how to study the international markets or specifically like international companies in general?

MARK

June, I’m happy you asked. I’ve got a Substack and what do I do?

I write about international markets from time to time. So the best way is to go to learning investing thriving on Substack and pick up my pieces. No, but on a serious note, I will send it to you guys. I don’t know if you do show notes or if you want to share it around, but about a month or two ago now, I did a tour to globe because we obviously have the tour to def race that sort of inspired me.

So I did a tour to globe threepart series. One was on Europe, one was on Asia, and one was on the Americas, ex USS, it was Canada, Mexico, and some countries in South America. So, there’s ETFs for virtually every major market. lowcost ETFs, especially as you know, C above, try to save on fees. the MSCI obviously has indices for each individual market and they have ETFs that track MSCI Spain, MSCI Switzerland, MSCI Korea, MSCI Japan, etc., etc. So that would be the first protocol because again until you’ve got time to really delve deeply, why not just buy the index?

You can even buy a European VEU which is the European Vanguard fund. So if you want the whole c you know the whole continent as it were in one go boom do it there. So that would be the first thing. The second thing would be what’s interesting is a lot of it believe it or not a lot of US companies they’re involved in Asia so or involved globally.

So Google is used everywhere apart from possibly China you know and and John you were talking about MetaF Facebook. If I’m in France like I was this past weekend people are on Facebook Instagram over there. And if you’re in Korea the same and etc etc. So a lot of your US exposure is already or US listed names is already you know Europe Assia South America.

But the third thing I would do is if you’re interested in a US company which I’m assuming most of the people listening this are there’s a lot of comparable companies outside of it. So I would start that way. I’d say, okay, I’ve been looking at, let’s say, the chip space in in the US, you know, the Nvidias, AMD’s, Intels of the world. Oh, as it so happens, Korea/Taiwan with TSMC, Highix, Samsung, or ASML in the Netherlands, you know, so you have a lot of comparable companies.

Or if you’re if you like oil or gold companies that are listed in the US, well, you know, there’s a bunch of oil companies listed in Europe, a bunch of oil companies listed in other parts of the world or or June, you mentioned Hyundai that goes with the automotive sector obviously. So, I’ll give you a fun story. When I moved to Asia in 2001, I had at that point not really invested much in Asia, a little bit in Japan. and I moved there and I got along well with a lot of Korean brokers and the Korean market. I mean, you think it’s crazy today.

It’s been crazy. It’s been crazy for a long time. The Korean retail investor has, you know, will not die easily. Let’s put it that way.

They were active in the early 2000s just like they’re active as we’ve seen this year. And one of the brokers got me involved in Korean Air. So I had been looking at airlines and again same thing airlines whether you’re looking at a Delta American Airlines in the US or whether you’re looking at a British Airways or an Air France in Europe or whether you’re looking at a Korean Air or Japan Airlines in Asia. You know what the underlying drivers are a lot the same.

It’s the economies of the countries. It’s the union labor costs. It’s the oil price. You know these things.

And so once you’ve analyzed one country’s airline company, it’s pretty easy to then use that framework to analyze it elsewhere. And the great thing about Korean Air, Jin, you’re probably way too young to even know about this, but it was a belleaguered airline in the early late 90s, early 2000s. They had a few crashes and they were really not going bankrupt, but they were not in a great shape. They brought in new management. they actually joined this airline alliance, the Sky Team as it’s known now.

So that they’re with Delta in the US, they’re with Air France, KLM in Europe. And so that, you know, they’re one of the big airline conglomerates now that that have formed. And the broker said, “Listen, that’s a great turnaround story.” And the stock, we bought it, and within the space of six to 12 months, it was it was easily a double. And I think at the peak got to four times where it was.

And the great thing that I learned, that’s another lesson I’d say is a lot of the locals and a lot of the people who had been doing Asia for a long time, they said, “Don’t touch Korean air with a 10-ft barge bowl. It’s like it’s toxic. It’s, you know, they’ve had all these accidents and the management doesn’t know what it’s doing.” And all that was true up until a certain point, but I wasn’t impacted by that because I had not looked at Korean Air in the ‘90s when they were having all these issues. I came in fresh, not knowing much about the past, looking at the situation as it was in the early 2000s, this turnaround, and I said, “Yeah, this is a great turnaround story.

Let’s get involved.” And I wasn’t, I wasn’t, you know, tainted by my previous experience. So sometimes knowing less can actually help you, believe it or not. It, you know, you’re coming in with fresh, the old grizzled vet, you know, might have some previous baggage from stuff that they lost money on. So it’s like I’ll never touch that stock again, you know, but every every stock every sector has its day.

I mean you look at look at Nvidia for for for as a great example between the mid 90s to the you know five years ago the stock really didn’t do a whole heck of a lot and now you know it became the biggest the first $5 trillion company or Apple between the mid 80s to the early 2000s until the iPod came out and then eventually iPhone and the iPad etc. Apple was on the brink of bankruptcy a few times and then it became the largest company for for a long time. So, you know, sometimes you have to look past you obviously learn from the past and go forward, but sometimes you don’t want to let that paint your your vision of what can happen because it might prevent you from investing in some great companies.

BAEKHO

Yeah, that’s really surprising to hear because I remember so I think my earliest experiences with Korean Airlines was when I was like a kid and I remember there being just like like clean food that tasted pretty decent and like they give you headphones and everything and I was like this is so much better than like an American airline.

MARK

Yeah, the Asian airlines John, have you ever had the chance to travel in Asia or on these Asian airlines?

No, I mean I’ve been on Thai Airways once. yeah. But they have pretty remarkable service. I mean, 100%. Yeah.

Yeah. The Asian airlines, whether it’s Thai, as you mentioned, Korean Air, obviously the Japan airlines are great. The Singapore Air always gets ranked super highly. And nowadays, the Middle Eastern ones, you know, whether it’s Qatar or Emirates, they get ranked highly.

JOHN / 10X IDEAS

Now, obviously, that doesn’t obviously make it automatically a great investment. you can have great service and it can still be a bad investment, but you know, from a from a passenger perspective, these are these are great great airlines to fly if at all possible. And looking back at your time at Morgan Sandy, like what separated the best traders and portfolio managers from everyone else?

MARK

Well, I think we touched upon it. Obviously, it depends on the traders. So some traders are, you know, are are just making markets. And so for them, they, you know, they’re not going to they don’t care really what the stock is going to do tomorrow or what the what the commodity is doing tomorrow.

They just care about, okay, from 9:30 to 4:00, if it’s an equities, I just need to make sure I get the best prices for my clients. So from them, it’s not so much about that less is more that we talked about. It’s really about remaining cool and calm under pressure. I think you sort of touched upon it when I was asking you. you know what what you thought made a good retail trader.

So, it’s really you have to just keep a level head regardless of if you’re making money, losing money. Don’t let it when things are good, don’t let it get to your head. Think that you’re bigger than the market. When things are bad, don’t think that you’re the worst person ever, that you’ve, you know, you don’t know what you’re doing.

You just have to try to keep a balance because then that way you’re not going to be tainted or or making bad decisions. And obviously if you ever read any history of traders that have blown up their various banks and there’s plenty of them like like Nick Leon of Bearings Bank and you’ve had Sumitomo had a metals trader and and the list goes on and on. it’s really people who start losing a bit of money. What do they do?

They double down. They double down. Then they eventually start hiding trades in the drawers or or that’s back in the day when it was old school or nowadays you know they try to you know break into the systems and hide the trades that way and then before you know it when it eventually does come to light it’s been you know the losses go from X to a thousand times X. So I think I think staying cool and calm will will serve you both well if you’re a high frequency u you know you know someone who’s trading a lot or even the retail trader goes back to the ret retail thing of we’re going to lose money there’s going to be periods where you don’t do well and you just have to realize that just take a step back why have I lost money let’s do the analysis is there something I need to change yes no and if no then don’t and if yes then make the change and then you know live to fight another Yeah.

JOHN / 10X IDEAS

And right now especially like in times of AI, how do you think AI is changing investing?

Is it making investors more productive or do you think it will like reshape the entire industry over the next decade?

MARK

Oh, 100%. I actually again I wrote about this not too too long ago on my Substack. I came up with a list of questions to ask to put into either chat GBT or Claude in terms of how to you know analyze your portfolio, come up with investment ideas, themes, things like that. So I’m happy to send that to you as well. but the thing is and I would encourage anyone to do this is that you just cannot trust what the results cover a certain topic.

Just use the AI and put in basic questions about it. whether you know something a lot about German history or whether you know something a lot about cooking or whether you know a lot about mathematics and just ask questions and you’ll see that the botht and claude get a lot of it right but they also do make mistakes and so for me like I think I know a decent amount about investing so when I put in some basic questions a lot of it is right but some of it’s like not not quite right so it’s definitely going to change I think everyone should be using it to assist with data analysis and things like that. But you can’t just put in the question into chat or claude and then whatever answer it spits out assume that that’s the gospel from from high on above or the Moses tablets, you know. So you have to look at it with a u with a bit of a critical eye.

So that would be one way of using it. And actually just literally it’s funny you mentioned this. This weekend I was in Paris and I was having lunch with a friend of mine and he’s retired from having worked in finance. He was also a proprietary trader at a couple hedge funds and he’s now trading his own capital and he’s using cloud code to basically come up with automated trading rules and data analysis to make to focus on his trading.

And what he said is literally this was Saturday lunchtime, beautiful day in Paris. We’re we’re enjoying our food. But he was saying basically it’s like having three four junior analysts who are working at a very high level 24/7 and really helping him in his work in terms of you know making better investment decisions. Now we did say obviously you have to make sure you put in all the rules and the safeguards in place and you have to double check triple check the outputs but once you’ve done that then you are left with something that’s that’s great and so I think it’ll be used whether it’s from a qualitative perspective that a lot of retail people are going to do.

They’re not not going to necessarily set up their automated trading but it can also be used for that. I’m I’m sure June you had mentioned you were you were doing some trading. Have you used Claude or or other AI tools to help automate or or improve your trading?

BAEKHO

Yeah, I definitely have. So, like one thing about me is that I’m I like like I like this Asmoth Damodaran kind of school of thought where a lot of like narratives based investing cuz I think ultimately tech it’s it’s like mostly growth. So, a lot of it actually ends up just being narrative based and you see that especially with like Tesla like SpaceX especially. It’s like it’s all based on like this figure of Elon and the mythos around him not not any fundamentals in itself really the market that he and the total yeah of course so like for me I’m I’m really lazy I really hate doing DCFS so like that’s the part I really make the models do where I kind of input like my philosophy and I test all these different battery conditions around the investment thesis and I put in all these mental models that I And then I once I use that I say now okay based on that do a DCF for me.

And that saved me so much time because in the past I would have to like you know manually just type things out on Excel models and I would really hate that honestly. I just don’t like DCFS. I don’t know why. I just don’t like them. so, so yeah, I mean I definitely it’s really been a help for investing and actually really like kind of like that an like the Moses analogy that you used.

Me and John actually talked about this in a previous episode where we talk about like how machines will replace all these humans, how machines will take over all these jobs. what they fundamentally don’t realize is that at the end of the day the humans are the best at making the decisions because humans have that inherent property of being able to control chaos or work within it and fundamentally these AI machines they struggle a lot with chaos. I talked with a friend who knows a lot of researchers at these top labs and the these models always break down due to human chaos at the end of the day. and that I think that actually really speaks to something fundamentally beautiful about humanity. Our ability to conquer chaos, to emanate chaos, to kind of ride the waves of the Cali Yuga, let’s say. So, I think that’s what what really is underappreciated right now in the AI narrative where people talk about this AI machine god that will take over humanity.

I don’t think people just appreciate humanity enough. And I think that we’ll really see that in the coming days especially in the markets as well if there if once there that narrative shift really takes place cuz I think that AI will slow down actually I think that all technology is inherently cyclical. So as you see these big waves of expansion but it always slows down because I don’t think the universe is kind enough to allow for such infinite like tech progress at once like the technology tree of human civilization is inherently like slow. It’s fat and slow at the same time.

It expands and it contracts. so yeah, I mean, I just think that it’s it’s not it’s not this like major it is a major trend, but it’s not the final trend, right?

It’s not like the end of history as Francis Fukuyama would put it, right?

It’s like it’s like just another arc in human history. That’s fun. I think that actually ties in perfectly with the next question, John. how you mean the narrative, right?

JOHN

Like Yeah. The narrative like what?

What’s like the marked narrative or like a consensus view today that investors are like getting completely wrong.

MARK

Ah well I guess I’m going to tie it in with AI, right? I think one thing that people I personally think are getting wrong is that AI is a bubble and or that valuations are too high so that we’re due for a crash imminently. here’s the here’s the thing and again I’ve been in the markets a bit longer than the two of you. Pessimists, people calling the end of the world and I mentioned the great Marc Faber a bit earlier. you know, they always send tend to sound smarter than the bull because they have great arguments for why this is, you know, the end. It’s every the bubble’s about to burst and they have this this this this and they yeah they seem to be, you know, calling out something that everyone else is bullish and everyone’s buying and we’re going we’re going to the moon and so I think we tend to rever pessimists a lot and look you have to be weary and you have to be protected and you certainly don’t want leverage like what our friend Leopold Ashen Brener just showed you know, it’s it can be dangerous, but if as long as you’ve got good risk controls in place and or don’t use too much leverage, there’s nothing wrong with being, you know, almost fully invested at all times.

I mean, there’s been a bunch of research shown, you know, whether it’s JP Morgans had a very famous piece and there was a piece that was floating around just in the last few weeks of if you bought at all-time highs, your your returns were actually the same or sometimes even better than if you bought at any other day during during market cycles. So I it’s it doesn’t feel good if you buy and then the next day that Trump announces tariffs or an Iran war or COVID breaks out and the markets are down 20%. No one likes that. But as long as you’re not levered, you can live to fight another day.

And if anything, as long as you happen to have extra cash coming in at some point, you can then deploy it at a lower level. So I think that would be the biggest biggest narrative that I would fight against that AI is a bubble and valuations are too high.

Are valuations high?

Absolutely. But earnings growth is high. Even though these companies the mega hyperscalers are taking on debt, they’re still overall very lowly levered. June, you just mentioned Asat the motorin.

And what’s great is I literally listened to a podcast with him on on Friday. So he was on the prof pod. I don’t know if you listen to the Prof G podcast pod, but he comes on their their podcast because Scott Galloway, who’s Prof, also works at NYU at times with Asmoth. And so they know each other from from NYU Stern.

And so every quarter Asmoth comes on. So he was just giving his recap of the second quarter. And even though Asmoth is a little I wouldn’t say bearish but certainly weary of market valuations you know he says the same thing that he’s invested in five of the of the max seven names. The two that he doesn’t have are Tesla and I think Meta or definitely Tesla but I think Meta is the other one he doesn’t know. but he you know he’s he’s looking to deploy cash in these markets and thinks that of course the the AI story is really wellnown but we do have to you know respect it and we have good visibility companies these are long-term contracts that they’re signing with the various chip makers and things like that and so as a result it’s not like earnings are going to collapse in the next quarter or two now, in a year or two possibly if if the returns aren’t going to be there and if companies start cutting back.

But right now I think we’re we’re still in a okay place from from a investment perspective and what what has been like your biggest mistake in your career investing wise and what did it teach you? easy. The the biggest mistake is just trusting someone else’s opinion blindly. So, it’s like June calls me up and says, “Mark, you got to buy Palantir.” So, no, but you know, if you just of course you want to listen to others, you want to hear what they have to say, but just buying something blindly because your friend or your barber or your, you know, someone tells you to do and you don’t do enough research on it. Now, I’m not saying you got to do a deep dive and break everything down and know the company inside and out like like Warren Buffett does, but you know, do a little bit of work before you get involved just because that at least will tell you when things start going wrong whether you should re-evaluate your the thesis.

Whereas if you just buy something because your friend or your family or someone tells you that you respect tells you so that you listen to on TV or in a podcast, then you really don’t know why you bought it because you you know it maybe for that day or two because you just heard the reasoning. But 3 weeks later, you know, so much has happened in your life, you’re not going to remember why you bought it. And then when things don’t go well, you don’t know, wait, why why did I own it?

So then you’re more more likely to then sell it when maybe you shouldn’t be selling it. maybe it’s just going against you because of some other reason and you actually should be doubling down but you don’t have the confidence to do so. So I would say yeah you know just blindly following someone else’s opinion may work out but I don’t think is something that one should be doing on a frequent basis or at all actually. Yeah. Always do your Research

BAEKHO

Yeah, I would I would agree heavily with this because I think that honestly knowing when to sell is actually might be more important than when to buy.

And if you don’t know why you bought in the first place, then you’ll never know when to sell because you don’t have like the like there always has to be some sort of thesis change or or thesis completion to when you sell. So, I think that makes like total sense. Yeah.

JOHN

And like if you could give one advice to your 25 yearear-old self just starting out at Morgan Stanley on the trading floor like and what would it be like in life and also in investing?

MARK

I would just say get out there talk to as many people as you can learn from as many sources as you can. The great thing now compared to back in my day we had to read newspapers we had to buy books. Obviously, every now and again you had access to some some people. I was lucky enough to join this program at Morgan Stanley, but nowadays through the social media sites, whether it’s obviously YouTube, Instagram, Tik Tok, whatever, there’s a bunch of Now, a lot of it might be not great, but as long as you do a little bit of work, you can sort of narrow it down to a to a few people or sources that you trust.

Podcasts obviously are great. I mean, even even today, I mean, I listen to podcasts every single day. you know both about finance but also about sports and politics and other things. But you know just just get the variety of sources. but especially for young people I’m hearing this a lot about how people now are are stuck in their own little bubbles. You’ve got your phone.

So you think you know a lot you’re in touch with a lot of people via via the various social media sites but you’re not really getting out there. And so that would not as much from an investing side that’s more from a personal perspective side. But I think the more people you meet the the more opportunities are going to be there. So again again taking more of a big picture if you have a job a normal job and they offer you the work from home versus into the office go into the office.

You know it was one of the great things that I learned was being there with with these people that have been trading for 15 years. and they you know even if you’re not talking to them directly you overhear conversations that they have with their their colleagues because you’re you know you’re the young little idiot they don’t want to deal with you but you know just keeping eyes and ears every now and again maybe they let their guard down. you’re able to go grab a coffee or you’re able to have a one-on-one chat at the you know in the cafeteria or whatever it might be and before you know it, you’ve you’re building up this this base of knowledge and of resources that one day will help you when you want to make a pivot when you want to let’s I think June you said you’re looking to start a fund at some point. The reason you’re probably going to be able to do that is not only your track record because but a lot of people have a track record is also your contacts and that’s that’s gold, you know.

BAEKHO

Yeah, for sure. Yeah. I think that like for example like I think just from my experience like most of the internships I got were just from like people referring me and never really through like official applications cuz I remember there’s like this like computing or organization that I knew the president of like he wanted to do a startup with me. So like back in like 2021 back when it was like peak crypto times which I actually do want to talk to you about later because I saw you were on the board of Tronda I think. so yeah so he it was yeah I’m sure you remember maybe then the that peak 2021 cryptobubble time like so we he we did he did like a crypto payment startup which was like pretty silly.

It was like a Chrome extension that you could use where we were the middleman where people could just buy anything using the Chrome extension with crypto. and we were getting like DMs. I was getting DMs on my ex my Twitter or X account. It was Twitter back then about from like Paradigm, which was like a tier one crypto firm. And I was just like, what is going on?

Like this is like pretty BS. But we I was doing like investment calls with these like VCs at 18. and so it was like, so it’s just like stuff like that. It was just pretty funny. But then that ended up leading me to get an internship at a VC fund because apparently like the guy who was like the president of that club, he was friends with VCs in the area.

So they heard about me and then I got recruited to do that my freshman year internship at SK Hynix. I was to like message like an employee who went to my magnet high school to get to land that. So like all of those things, they were all mainly just because of like connections that you know they weren’t even like close personal connections really. They were just like things that I just like levered from from like networks that already kind of existed within already.

So yeah, I think I think a lot of college Well, I think college kids are doing that more now than they than they did in the past maybe or in the more recent past because it’s been like this trend where it’s been like this whole meta strategy where a lot of college kids are doing that for internships because they think that it’s hopeless otherwise. So it’s baekhoming this whole like almost like this like performative culture where everyone’s like networking and going to these tech events and so on. And I mean which is a little bad and but you know at some but also at the same time there’s not really any alternatives so it kind of is the way it is. but yeah I think that people just in general even aside from that they just don’t really value like connections enough and especially preserving them because I think what I found that is that it’s easy to make connections especially if you’ve done it for a long time. but I think con like preserving those like connections especially from like college or high school is really important as well.

MARK

100%. 100% agreed.

JOHN

All right, I think we can wrap up with some quick fire questions. so yeah, if you could just give you like your opinion like in I don’t know like a one minute or so for each question. Okay. bull bear for the next 12 months.

MARK

I’m assuming we’re talking stock markets or Yeah, about the stock market. Yeah, I mean I think I played my my poker face is pretty pretty poor.

I would say bull, you know. I would I think all systems go in terms of liquidity, in terms of underlying equity, earnings. obviously interest rate cycles might slightly go against against the grain a little bit but and valuations are are on the higher end but overall definitely both. All right. And in terms of personal investing growth or value?

Look for me personally I’m more of a growth guy. I you know I’m a bit like Joon. I like the stories you know that that that big big moving stories and even though I went to a school that really espouses efficient markets and the like and DCF might be were highly prized. I Yeah, I think Jyn and I are brothers from other mothers in that respect.

BAEKHO

Out of curiosity, was it the booth school back when you were there or was it not named that yet?

MARK

I’m I’m old. it was not school. It’s funny because I it became Booth I think in I want to say 2001. I finished in 97. So I have my diploma that I got from from from 97, but I had it in just a little, you know, like a booklet that they give you your diploma.

And so John, I don’t know what they do in Germany when you get your diploma, you know, the sheet of paper, right?

In the US, they tend to give it to you and then you open it up and it’s there. And for a long time, it was just in a drawer. and about now my daughter lives in Chicago so I go and visit her and so I went there once and I went to the school and I bought a frame so we then I could put the diploma up on the wall and now the frame obviously because it’s been renamed Booth School has the Booth Booth name on it but yeah so it was not the Booth school but now it is the Booth school but it’s the same school basically.

BAEKHO

Yeah, actually I managed to meet I think his name is David Booth, right?

I I managed to meet him once when I was in Austin. he wrote a book called like stay calm or something. He was doing like a small like promo of it. he was talking about how you should just like no matter what doomsday scenarios or prophecies you hear, you just like just stay calm and stay invested in the markets. And he kind of like shouted out his own like company like Dimensional Analysis. Yeah, those ETFs.

I think those are pretty solid ETFs. I like bought some after because I was like, “Yeah, they seem pretty solid.” He seems like a solid dude.

MARK

Absolutely. Absolutely.

JOHN

All right. Favorite stock at the moment.

MARK

You know what I’ll do is I’ll I’ll do a little bit blend of what we spoke about. So, I’m going to go with actually an ETF.

It’ll be a gold junior gold ETF, GXDJ. And it’s just I think gold obviously had a great run the last few years. This year it’s had a bit of a struggle. It’s gone from above 5,000 to the low 4,000s.

So as a result the gold miners have struggled along with it but I think you know US is printing more money than than it can even imagine. So and not just the US you know a lot of other countries are in a dire fiscal strait. So I would expect gold to have its moment back in the sun sooner rather than later. So I would be involved there and copper or silver would be other alternatives.

So again buy ETFs related to either gold, copper, silver. I think you should be rewarded handsomely, right?

Especially like with the geopolitical risks also at the moment. Well, there’s that. Although one could argue that, hey, this war in Iran’s been going on for 6 months now and yet gold hasn’t bounced. So, I don’t know if that’s really going to change much.

But yeah, let’s say things got worse. Maybe gold gets a little bit of shine that way. But no, I that would be less on the on the reasoning as to why buying it.

JOHN

And what’s the best trade that you’ve ever made?

MARK

Oh, can I make a copout here?

So again, I’m gonna go back to pushing my own Substack learning investing, thriving. I wrote a I wrote a piece. I know exactly when. It was April 25th, which was my wedding anniversary.

And I called it the best I actually called it the best investment I ever made. But you know, here you’re talking trade. And so getting married, now I’m not saying necessarily getting married is for everyone, but certainly finding a valued partner in life that you can share that you can share some happy times with is great, but I’m maybe that’s not what you were looking for. No, I think that’s I think that’s valid.

It’s valid. It applies to life, I think, just as much obviously because it’s it’s the same with like education, but then also Oh, wait. Yeah. Yeah.

I just got a call. But yeah, like it’s it’s also with education but also with like personal choices, right?

Like having like the right partner with the right mindset that can have like you know limitless upside in terms of like your your personal return in life. So I think I mean full disclosure I’m now on marriage number two. So it doesn’t always work out. You know you do get but overall I think it’s it’s more of a more of a bonus than not.

So again, not not necessarily getting married. I don’t want to say you have to, but you know, certainly having someone who to share because as we spoke about earlier, part of it is dealing with the bad times, whether it’s in your investing life or in your personal life, in your work, professional life, what things, you know, when times are good, who needs friends, right?

As I said in the famous movie Wall Street, I don’t know if you’ve ever watched that one. You know, if you want a friend, get a dog. but you know, I think we all need friends and we all need people to be able to bounce ideas off of and you know, frustrations and things like that.

JOHN

What’s the most overrated invest investing metric in your opinion?

MARK

Maybe I shouldn’t say this, but any any valuation metric. okay. I think if you just and actually again I was just listening to this podcast with Asmoth Damodaran and he’s the father the dean of valuation and he said something similar obviously he does DCFS and he’s you know he believes in EV bed and pees and all these valuation metrics but first of all if they’re not used properly you know you can say this stock is cheap because it’s trading at six times earnings or at one time sales or at 2.3 times EVA but you have to know why and you have to know are the numbers actually what you’re looking at a great example is what’s happening with these hyperscalers so both Google and Amazon reported phenomenal earnings but a large proportion of their if you just look at the simple EPS a lot of it was revaluing their stakes in anthropic and actually in the case of Google they also held some some shares in SpaceX so now they’ve revalued them up so the EPS went way up so as a result the PE has come way down so you have to realize what you’re looking at.

So any just like any tool, you know, a hammer can be a great tool if I want to put up a nice painting or poster on the wall, but it can also be a bad tool if you if you use it poorly. So I think any valuation metric can be overrated if that’s the only thing you look at. If if I go to you, John, and June, I say, “Hey, you got to buy this. It’s trading at one times book value or half a book.” Yeah. you know, that’s that’s not a good enough reason. or oh this thing is way overvalued it’s trading at four times book or 10 times book you know so I would say that there’s always a reason like for valuations and exactly it can change it’s it’s always relative right like to to other companies also so it’s fair enough so that kind of eliminates the next question the most underrating investing metric since in general like you don’t really look at investing metric that way in no that well I don’t want to make seem like I don’t look at it.

JOHN / 10X IDEAS

I just you have to know how to look at it, right?

MARK

I would say on the most underrated I did again think that one thing that I do look at and we sort of joked about it earlier but I do think total addressable market or or what what pond are you trying to swim or is the company trying to swim in is super important. Now, SpaceX has sort of made put a little bit of a of a of a, you know, taken the gloss off of that with with their recent IPO in terms of saying that the AI market was 26.5 trillion dollars. So, they made a bit of a mockery of it. But in reality, I think it’s better.

The example that I was giving my students all the time was over the last 20 years, you would have been much better off being an average employee at Google than the top employee at General Motors, for example. because Google was, you know, exploding with its with its market and so rising tide lifts virtually all boats whereas you know an auto company or some of these old school industrial companies were struggling because it was low growth industries that they were operating in. So you really have to be a super superstar there to have done well. Whereas you know John or and even in we make fun of SpaceX but you know any employee at SpaceX over the last 5 to 10 years is now a multi multi-millionaire. And why?

Not because they’re necessarily so much smarter than you or I. It’s because you know they happen to be in a company that went from being very very small to now being you know at one point almost $3 trillion. And even now with its recent fall still one and a half to 2 trillion. So you know you’re better I think the market really helps if you can pick the you don’t then have to be as specific or as right on the actual company that you pick if you if you’re able to be in the thing that’s got the wind and its sales as it were.

BAEKHO

You know speaking of speaking of SpaceX you could actually say that their your theoretical TAM is just like the entire universe. You can you can technically justify their valuation based on that, right?

Like you never know.

MARK

Are you partially partly employed by by Elon?

BAEKHO

No. No. I actually bought some SpaceX shares, but not that many just for fun. I just I thought it was like the valuation was crazy. but I just wanted to like see if I could ride like a short momentum trade.

It’s at like 130 right now. I was I was thinking like maybe before something happens like this fall maybe it goes up a little but I don’t know. I just I am a big fan of Elon though just because he’s like he’s kind of like the final boss of tech where you there’s no one else in tech that does it like him especially when you think about like the industrial sector where he actually outputs like real products in a way that no one really else can maybe aside from like Apple or maybe like the logistics of Amazon. the only people who who really compete on his level are are all in China really or maybe like one in Europe. So I think that Elon is this sort of like civilizational talent which is why you would but it’s like basically that’s like the only reason you would ever invest in SpaceX.

Like you believe in Elon as like a great man of history and I actually do believe that he will be a great man of history. which I find just really really entertaining.

MARK

Sure. Sure. He’s a he’s a genius at that in terms of and he’s done it with Tesla and he’s doing it with with SpaceX of okay Tesla it’s cars then it was a bit you know self-driving but then he’s always got this thing oh then it’ll be robotics and then it’ll be fully automated and so it’s things that they’re they’re not here today but it’s going to happen in 3 five years and same thing with SpaceX of course they have the rocket side of the business they have the satellites the cellular a business, right?

But then the other thing is, oh, now this X AI and the sky’s is the limit. So, as long as you believe in them, then then yeah, buy the stock and if you don’t believe in them, you aren’t going to buy the stock. And if you’re really gutsy, you’ll short the stock. And people have lost a lot of money over the years doing that.

But, but yeah, it’s a little bit for everyone.

BAEKHO

Yeah, I think in like our very first episode we talked about SpaceX and how like a single city on a different planet could like have the GDP of the entire Earth. So that would be like the ultra bullcase for SpaceX.

MARK

So I But why are you even looking at Earth?

What about Mars or a moon or other planets, you know?

BAEKHO

Right. Right. So you’re you’re talking about Yeah, we’re talking about Coruscant. Coruscant’s real in Star Wars, you know.

Coruscant, you know, if they’re just pre-programming it into our heads so that, you know, in the future, let’s say 30 years from now, when we start building Coruscant with like these AI armies that, you know, we’ll just see it and be like, “Oh, yeah, that, you know, it’s just like that Star Wars movie back in the 90s, you know.” So, yeah.

JOHN

All right. And yeah, final question. What’s the best investing book that you would recommend?

MARK

Oh, you know what I like? obviously there’s so many good ones, but I would say a good one recently, which I’m sure you’ve read, is The Psychology of Money, Morgan Hel. You might have heard about it. Heard of it, but I haven’t I haven’t read it yet. Yeah, Joon, you were shaking your head.

You know it or you’ve read it?

BAEKHO

I’ve heard about it. Like I’ve read like I think I’ve read excerpts of it which really sucks cuz I read so many investing books but I think I just saw the book and I thought like what’s it going to cover that I haven’t already like read from like for example like Charlie Mer’s books cuz he does a lot of psychology in them so I just decided not to buy it. But I don’t know but maybe there’s some sauce in there that I need to see

MARK

Like it’s maybe not for you, you’re obviously heavily involved. they I think what a lot of the traditional investing books it’s a lot about the you know the fundamentals about how to value a company bringing them down the valuation metrics all that but at the end of the day markets are moved by people I think June you mentioned it you know it’s people making decisions and we’ve talked about this over and over and over again over the last hour and change that it’s you know people make even though there’s there’s a lot of automated tools there’s a lot of technology at the end of the day it’s people And the great thing about that book is it’s psychology.

It, you know, tries to break down and really bite-size, easy to read. You know, you pick it up. You can read it over two, three, four days when you’re at the beach, when you’re at your friend’s house, or, you know, late at night before you go to bed. And it’s, you know, doesn’t get overly technical.

It gives great stories. It gives great examples. And it just brings home the fact that it, you know, markets are moved by money. I will say then one that you may not have heard and actually again one last plug for the for the Substack is I literally just put out a piece.

It’s a guy I went to college with at University of Chicago/Booth and he’s way more successful than I am. He runs a lot of money and his name is Matt Ankram and he just wrote a book called The Coffee Can Investor. It’s actually not him. He had a writer do it, but it’s based off of his his investing strategy.

And again, I’ll send you the link if if you want. And it’s about finding hundred baggers. And so over his investing time, he’s tried to look at he’s been involved in markets just as I have since the late 90s. And he’s tried to find qualities of companies that have gone up a hundred times.

And he just lays these things out in terms of, you know, they’re mainly B2B rather than B TOC. and these types of things. And what he’s done actually is he’s taking he’s got three daughters. He’s taking $5 million of his own money, buying 20 stocks. So $250,000 in each of these 20 stocks, putting it into into their name, and maybe in the next 30 years, you know, if they’re up 100 times, you can do the math on how much money that’ll be.

And his daughters will be really, really happy. and if not, it’s still free money for his daughters, so they’re happy any which way. But no, that’s a that’s a good that’s a good alternative book that that just literally came out earlier this year. But Psychology of Money is really well known and if not the coffee can investor that just came out. I wouldn’t say it’s the best ever because it’s quite recent, but it’s one that I have on my mind just because I wrote about it and I spoke to Matt about it.

I just did a mailbag episode because some of my Substack readers were asking questions, you know, what are some of the stocks he bought or or you know, what industries or would you invest in index funds, you know, stuff that we talked about here?

And so I sent him an email and he answered them. So it was the one of the easiest Substack post I had to write because I just sent him over eight questions. He wrote the he wrote the thing. I just put a little intro paragraph, a little outro and copy and pasted the rest.

BAEKHO

It was nice. Yeah, that’s awesome. Yeah, I’ll definitely check it out. I actually wrote it down. is it on Amazon or where can you find it?

BAEKHO

Okay, cool. Cool. all right, so I had like a question. So I remember you talked you mentioned crypto earlier about like allocating like five around 5 to 10% and you also checked that you were on like the board of Tron DAO. So how how did that like end up happening?

How did you get onto the board of Tron DAO?

So, how did they get in contact with you and yeah, what are your what’s your kind of experience in the crypto industry and your projections of it going forward?

MARK

Well, I mean, the first thing, let’s take a step back. I the way I look at the crypto industry, I break it down into four buckets really. One is Bitcoin. It’s its own bucket.

One is Ethereum/ some of these, you know, smart contract players. The third would be the stable coins and the fourth is the rest. You know, the meme coins, the ship coins, that’s a technical term and and the like. So, you know, so it’s really crypto is not just one thing.

It’s it’s multiple things. And if you really want to break it down, you can even get much more granular, but those are four buckets. so each has their own pluses and minuses. That last bucket, the meme coins, I’ve never really gotten involved with. I have traded, invested in Bitcoin and Ethereum and stable coins.

I don’t really use them that much because I live in Europe. I’ve lived in the US. So, I’m and you know, just like you and I, we’re we’re in highly developed markets. But, I do know that stable coins are highly used in much more emerging markets or countries where currencies aren’t as stable and the like and obviously all you got to do is look at the volumes and you can tell that that they’ve got a massive use case.

So that’s you know the overall view of of the industry from where I sit and again like I had mentioned earlier I think that everyone should have a small allocation there just because at least in Bitcoin and Ethereum keep it simple just because maybe Bitcoin is a scam. Maybe Ethereum just doesn’t get out of its own way. It’s really been struggling. I don’t know if you’ve followed it at all but you know it’s had troubles over the last few years.

It was a highly successful thing when it launched in 2017, but since then it’s had some issues the last few years and as a result the coin hasn’t performed well. But have a little bit if it doesn’t go up much or even falls a bit, it’s not going to wipe you out. And who knows, maybe it does go up five 10 times either or, you know, Bitcoin and or Ethereum and you’ll be you’ll be quite happy. so that’s my overall view of of the crypto space in terms of Tron. So, I used to work in Hong Kong as I mentioned and that’s where I my Korean air story and the like. and so Tron, I don’t know if you’re familiar with it, but it’s it’s basically the payment rails for USDT, which is one of these big stable coins.

And USDT, which is the Tetherbacked one, is actually mainly used outside the US. In the US, the big stable coin is USDC. so it’s really well used outside the US. USDT which is the stable coin and Tron is the rails that powers it over 60% of the transactions take place on Tron network. So as a result if you look at the it’s got a coin TRX you’ll see that the coins trading at or near all-time highs.

Actually it’s I think the peak was 36 cents. We’re at around 33. So it’s down 10% from from its highs but it’s been a slow but steady. It doesn’t go up five times like a memecoin could or like Bitcoin or Ethereum have done in the past, but also doesn’t fall 50% either like a lot of these coins have done.

So, it’s a slow but steady. Why?

Because it’s just the toll booth. You know, it gets a little bit of money. It’s got a lot of other bells and whistles, but that’s the broad broad outline of Tron. And so, how I got involved with with it was I was living in Hong Kong.

I knew a lot of people there. And one of the guys that I got to know in Hong Kong, he ended up working for Tron. there’s a famous guy named Justin Sun who’s the backer of Tron and the founder of Tron. Famous John. I see June’s shaking his head.

MARK

John, do have you heard of Justin?

JOHN / 10X IDEAS

I have heard of him. Yeah. Yeah. What’s this?

Have you heard of the banana story?

MARK

No, I have no. So Joon, you’ve heard of the banana story?

JOON

Yeah, I got Yeah.

MARK

So, at one point in Hong Kong, he bought a banana, you know, that was taped to the wall for $6.3 million. It was viewed as artwork. and then one day, obviously bananas as they get older start to rot. He goes to the art gallery, tears down, you know, takes off the tape and ends up eating the banana.

But it’s, you know, it’s it was a great publicity stunt. He got the word out and you know whether you and I agree $6.3 million might be a bit much to pay for a banana when you’re a billionaire for him it wasn’t a whole lot and the word you know to get the Tron word out there he thought it was worth it. The other thing he actually paid can’t remember how much it was but you know Warren Buffett auctions off the lunch. Oh yeah.

Yeah. He actually won you know five or so years ago he ended up buying the lunch and he ended up having lunch with Warren Buffett. So, you know, he’s a very serious guy who obviously does a few he’s flamboyant in other respects, but he formed this he created this thing Tron that’s that’s been a massive success and he’s, you know, multi-billionaire and, you know, really well regarded in the crypto space for those that are that are in it. And so, my friend is working with him and they’re making, as I mentioned, USDT is really popular outside the US. they want to make a big push into the US.

And so he tapped me on the shoulder at the end of last year. Mark, do you want to do you want to get involved?

And he because he knew I was interested in the crypto space. I traded it. I invested in it. So he thought, would you like to, you know, help us expand into the US.

And that’s the reason why right now I’m based in London, but over the next few months I’ll be moving back states side spending quite a bit of time in New York because obviously New York is the center of money at the moment u or not at the moment but in general in the US so a lot of capital market activities will help us expand there. So that’s how that’s my little Tron story.

BAEKHO

Awesome. Yeah.

So, do you plan on continue like do you plan on stopping your work teaching and focusing more on that full-time?

MARK

in the short term, yes, that’ll that’ll be the plan. So, for this upcoming year, I won’t be I’m not I won’t be working for a school.

BAEKHO

Yeah. Interesting.

So, I mean, I guess what are like the future plans of Mark or or the learning, investing, thriving substack?

MARK

Oh, well, you know, I think similar to you, this is a fun venture to get to meet people like you. This is great. I had I not been doing this, I wouldn’t have had the chance to spend a nice few hours with you guys and others like this. Plus, it’s funny.

It get it gets my my my Substack is about teaching, is about educating. So, I get to get that bug out of the way and I can do it on my own time and given I’m working more on projects for Tron rather than a 9 to5 in the office and having to do, you know, day-by-day things, I do have the time to do a little bit of this as well. Well, obviously if things get too busy on one one side of the ledger, then I’ll have to scale back on the other side. But for now, yeah, I can I can definitely juggle both at the moment.

JOHN / 10X IDEAS

Awesome. Well, I think we can wrap it up. Any last thoughts, Joon or Mark?

No, this was Listen, I really enjoyed it. I you know, it was great getting to know you and I think Substack is great that way, much better than some of these other social media platforms. and so people are highly encouraging and we can learn from each other and you know there’s old old fogies like me and young up-and-comers like you and everything in between. So it’s great. All right.

MARK

Yeah. Joon, you want to wrap it up?

BAEKHO

Yeah. I mean, it was just great hearing about all these different things from you, Mark. I really appreciated like your kind of more industry veteran perspective, let’s say, cuz the previous two episodes were just like me and John just like joshing around. And John would actually bring like a good prompt of us like he would go through the earnings of different companies, but it mainly be me just like kind of rambling on.

And I’m good at it because I don’t I don’t know. I just have like a talent for rambling, I guess. But

MARK

And you have the technical expertise also, you know. Yeah.

BAEKHO

Yeah. But this certainly brought like way more focus and in a great way for the pod. So yeah, thank you so much. Great.

MARK

And if you know in the next few months if you continue on and you want to do a catchup maybe not as long, we can just do a 30 minute or whatever just to sort of see where the markets are. If AI’s busted and I was wrong, you can you can tell me about it. Or if right SpaceX doubles and you made a lot of money off of your trade June, then you know I’ll hear.

BAEKHO

Yeah, we can do a little where are they now?

MARK

Right. So, that should be an episode. All right.

BAEKHO

Well, thank you guys so much for listening. remember to like, subscribe, comment, and we’ll see you in the next episode.

MARK

Thank you. Great. Bye. Bye.

BAEKHO

Bye!

Just dropped Episode 2 of Baekho Talks with !

Make sure to Like, Comment, and Subscribe!

Me and had a lot to talk about, as always

Look out for Episode 3 coming soon! Episode 3 will be with an investment professional with 20+ years in the industry

We are compounding views, compounding guests, and who knows, maybe even compounding interest!!!

Introduction to Mimetic Theory | René Girard

Civilization #END: The Decline and Fall of the American Empire

Is the war about to escalate? │ Robert Pape │ The World Podcast

The Iran War Just Expanded

Inside China’s Nuclear Warning to Russia

Jeffrey Sachs: U.S. Eurasian Strategy - Destroy Russia, Iran & China

Palantir Co-Founder on Fixing America & Disrupting Defense Innovation | Joe Lonsdale on Invested

So... Is Private Equity Collapsing Yet?

Evolution Speed Run | Rick and Morty | adult swim

Fullmetal Alchemist: Brotherhood is a Theological Masterpiece

Analyzing Anime - Attack on Titan and the Nephilim

No Peace Amongst the Stars | Warhammer 40,000 Official Cinematic Trailer

Tim Dillon Explains QAnon

BlackRock CEO Larry Fink: I’m very bullish on the markets over the next 12 months

S&P 500 to hit 8,000 by year end: Tom Lee

The Cold War Could Have Ended Very Differently – Sarah Paine

Why would a China vs US war last for years?

The market continues to value Duolingo primarily as a language-learning application. I believe this framing materially understates the company’s long-term opportunity. Duolingo is evolving into a consumer education platform with one of the strongest engagement engines in software.The long-term opportunity is building the world’s largest AI-powered personalized learning ecosystem, and the team is very aware of that.

It is a mistake to think that AI will replace language education. People will always want to learn how to speak other languages frequently because a conversation translated by an AI agent will always feel artificial. People fundamentally crave authentic human interaction and even an extremely low latency in ear auto translator will lack the perfect translation of meaning from the original speaker. Furthermore, we are a long way from the technology with both the latency and the proper translation ability, especially when considering how chock full of innuendo and nuance modern languages are.

There are some cultural elements lost in translation for every word that is translated between corresponding words of different languages. In other words, languages are not 1-1, nor will they ever be. Ever since the fall of the tower of Babylon, languages have been irreparably split and this is a much needed feature that spreads cultural diversity and creates the modern world, with all of its quirks and features.

Most education companies struggle with one thing: Getting people to voluntarily learn every day.

Duolingo solved this.

Its gamification engine produces engagement metrics comparable to social media:

• Hundreds of millions of users

• Extremely high retention

• Habit-forming streaks

• Personalized progression

• Daily active users growing faster than revenue

This behavioral infrastructure is incredibly difficult to replicate.

Every new subject added to the platform benefits from the same engagement engine.

In addition, the cost of expanding into new educational categories is dramatically lower than creating a new learning ecosystem from scratch.

The market implicitly assumes Duolingo is a language company.

Instead, it should be viewed as a platform.

Natural expansion opportunities include:

• Mathematics

• Chess

• Music

• Science

• History

• Economics

• Computer Science

• Personal Finance

Eventually:

• AP curriculum

• SAT

• ACT

• GRE

• GMAT

• CFA

• CPA

• Medical education

• Professional certifications

Each new vertical increases lifetime value without materially increasing customer acquisition costs.

Math is arguably a larger global market than language learning.

Parents willingly pay for:

• Kumon

• Mathnasium

• Brilliant

• Khan Academy donations

• Private tutors

Yet math education remains fragmented.

Duolingo can leverage:

• AI-generated practice

• Infinite personalization

• Daily habit loops

• Game mechanics

Unlike static online courses, Duolingo’s adaptive reinforcement creates long-term retention.

Khan Academy proved enormous demand exists for free digital education.

However, Khan Academy is a nonprofit and Duolingo is building the commercial version.

Potential monetization opportunities for Duolingo include:

• Premium subscriptions

• Family plans

• School licensing

• District contracts

• Teacher dashboards

• AI tutors

• Certification exams

If Duolingo expands into these markets the total addressable market expands dramatically.

Education budgets are massive.

If Duolingo develops:

• classroom management

• progress dashboards

• teacher analytics

• homework integration

it could compete alongside:

• Khan Academy

• IXL

• Quizlet

• Nearpod

Rather than relying solely on consumer subscriptions, Duolingo could develop a recurring B2B revenue stream with long contract durations.

The Duolingo English Test has already demonstrated the company can disrupt standardized testing.

The next logical progression includes:

• AP exams

• Placement testing

• Math assessments

• Professional certifications

• Skill verification

Testing naturally complements instruction and teaching + certification creates significantly higher customer lifetime value.

A common bear thesis argues that AI commoditizes education.

This misunderstands what learners purchase.

People do not buy information since information is already free.

People pay for:

• structure

• accountability

• motivation

• feedback

• progression

• measurable improvement

AI enhances all of these.

Rather than replacing Duolingo, AI makes personalized education dramatically more effective.

An additional long-term consideration is that education is not solely about acquiring information.

Even in a hypothetical future where brain-computer interfaces enable rapid knowledge transfer, the process of learning remains valuable.

Learning develops:

• discipline

• problem solving

• memory

• reasoning

• confidence

• creativity

Education is as much about cognitive development as information acquisition.

This suggests demand for engaging learning experiences may remain durable even under substantial technological change.

Through the power of AI every additional learner improves:

• AI models

• lesson quality

• Personalization

Duolingo is arguably the strongest consumer education brand globally.

Very few educational companies possess consumer mindshare comparable to:

• Spotify

• Netflix

• Duolingo

Its reward systems are among the best in consumer software.

Years of behavioral optimization create a moat difficult for competitors to reproduce.

Billions of completed exercises produce proprietary educational datasets.

This improves:

• recommendations

• adaptive learning

• AI tutoring

• lesson sequencing

Each new educational vertical benefits from existing users.

Cross-selling significantly reduces CAC.

Risks

Major risks include:

• Failure of math expansion

• Slower international monetization

• Competition from OpenAI, Google, and Microsoft

• Regulatory challenges in K–12 education

• Execution risk entering enterprise education

• Valuation compression if growth slows

The core premise is that Duolingo is not simply a language-learning company but a scalable learning platform. If it successfully extends its engagement engine into mathematics, test preparation, professional credentials, and institutional education, its addressable market could expand significantly beyond what many investors currently model.

That said, the valuation above depends on execution. The assumptions require Duolingo to continue growing at a high rate for many years while expanding margins and successfully monetizing new products. If those initiatives underperform or competition intensifies, the intrinsic value would be materially lower. The investment case therefore rests not only on the quality of the existing business, but on confidence in management’s ability to broaden the platform without eroding its unique user engagement.