Sunday Snapshots (22nd March, 2020)

Obstacle = way, Stripe’s fraud detection, Amazon’s hiring move, handmade paper, and Burning

Mar 22, 2020

Hey everyone,

Greetings from Evanston!

These Snapshots rarely have a coherent theme that spans across sections. But this one does.

It is how to make the most of unfavorable situations in a way that we don’t just survive them, but become better because of them.

As the whole world quarantines, we have a choice. Do we want to whittle this time away endlessly scrolling through Twitter or watching cable news? Or can we take precautions, help loved ones, and then use this time to better ourselves? To me, the latter sounds much better.

Here are the things I’m doing during the current shelter-in-place in Illinois:

Going on long walks
Re-reading Caro’s The Years of LBJ series as research for my upcoming book
Writing two long form pieces that are unlike anything I’ve ever published
Catching up with friends from high school who I haven’t talked to in a while
Reflecting on how college has changed me over the last four years
Taking stock of my weaknesses and how I can best hedge against them in the future

This is not to belittle the very real pain being felt across the globe. Those of you who have kids and parents at home are probably not having as easy of a time. But in every situation, we must ask ourselves – what can I control? In this situation, I am practicing social distancing and making sure I’m a better person having gone through this experience.

With all that, let’s get into this week’s Snapshots in which I talk about:

The Obstacle is the Way by Ryan Holiday
Stripe’s fraud detection methods
Amazon’s move to hire 100,000 new workers
How Japanese handmade paper is made
What I’m watching during the shelter-in-place
And more!

Book of the week

There are a few books I come back to when times are not looking good. The Last Lion: Alone by William Manchester, Remains of the Day by Kazuo Ishiguro, and Letters from a Stoic by Seneca come to mind. This week, I’m adding a new one – The Obstacle is the Way by Ryan Holiday. The decision is fitting since all the previous three book were recommended to me by Ryan on his reading list email.

In Obstacle, Ryan challenges us to flip every challenge on its head and asks ourselves how we can use an obstacle to practice a particular skill. How to turn the obstacle into the way forward. It’s a powerful book and oddly reassuring in this chaotic time.

He breaks up the book into three sections – perception, action, and will. Here’s how he introduces each of them:

Perception:
To prevent becoming overwhelmed by the world around us, we must, as the ancients practiced, learn how to limit our passions and their control over our lives. It takes skill and discipline to bat away the pests of bad perceptions, to separate reliable signals from deceptive ones, to filter out prejudice, expectation, and fear. But it’s worth it, for what’s left is truth. While others are excited or afraid, we will remain calm and imperturbable. We will see things simply and straightforwardly, as they truly are—neither good nor bad.
Action:
Action is commonplace, right action is not. As a discipline, it’s not any kind of action that will do, but directed action. Everything must be done in the service of the whole. Step by step, action by action, we’ll dismantle the obstacles in front of us. With persistence and flexibility, we’ll act in the best interest of our goals. Action requires courage, not brashness—creative application and not brute force. Our movements and decisions define us: We must be sure to act with deliberation, boldness, and persistence. Those are the attributes of right and effective action. Nothing else—not thinking or evasion or aid from others. Action is the solution and the cure to our predicaments.
Will:
Will is our internal power, which can never be affected by the outside world. It is our final trump card. If action is what we do when we still have some agency over our situation, the will is what we depend on when agency has all but disappeared. Placed in some situation that seems unchangeable and undeniably negative, we can turn it into a learning experience, a humbling experience, a chance to provide comfort to others. That’s will power. But that needs to be cultivated. We must prepare for adversity and turmoil, we must learn the art of acquiescence and practice cheerfulness even in dark times.

The book is filled with the countless historical anecdotes that Ryan has collected over the last decade from his voracious reading. If you don’t want the philosophy, read it juts for those stories. And if you read on a Kindle, the book is on sale right now for just $1.99. I highly recommend you grab a copy.

Long read of the week

When a system is a conduit for financial capital, it is a tempting target for fraudsters. Payment processing company Stripe is one such system.

While they used to relying on heuristics to detect fraud, their new fraud detection mechanism utilizing a continuous two-step process that uses information from known fraudulent transactions to improve itself – the obstacle becomes the way.

Here’s what it looks like (simplified):

Detect fraudulent transactions: Based on known parameters like a suspicious bank account number or an unusually high number of chargebacks, fraudulent transactions get labeled as such.
Identify similarities with other transactions: Based on these labeled fraudulent transactions, the algorithm searches for other transactions with similar attributes such as origin, amount, etc. This in turn labels other attributes used in step 1 as potentially fraudulent.

The blog post on Stripe’s website by Andrew Tausz is highly readable if you have even a cursory understanding of machine learning. It’s a great example of good technical writing that is meant to be consumed by a mass audience.

Lucrative systems will always be under attack. But this clustering solution turns the attributes of the attack against the attack itself. That’s certainly better than being engaged in a never-ending cyber arms race.

Business move of the week

Amazon to hire 100,000 warehouse and delivery workers

When I read Social Capital’s 2019 Annual Report last week, I highlighted a particular section that talked about how tech companies haven’t been able to effectively spend their R&D cash on the externalities that they have helped create. My annotation to this paragraph was a question: “Who are you pissing off and how can you still keep them on your side?”

Jeff Bezos just showed us how.

In the midst of the greatest economic crisis since ‘08 against an invisible enemy, Amazon is hiring 100,000 workers. That’s a powerful way to push back against rising calls about your increasing power over the American economic system. Even though it highlights the problem, I’d bet that no one will criticize Amazon on this move.

Yet, they are not doing it out of the generosity of their hearts. Stay-at-home orders across the country have led to a surge in online shopping and about 50% of American e-commerce flows through Amazon. Someone still needs to pack those orders in warehouses and deliver them to your doorstep. It’s no surprise that the company has a lot of customer goodwill – low prices and one-day shipping mean that divinely discontent customer is mostly content these days. After this move, they might have labor goodwill as well. 100,000 workers is a large number and I suspect (although correct me if I’m wrong) that many of them have been let go from restaurants and retail jobs. They will see Amazon as a safe haven for tough times. Once you’ve accrued labor goodwill, political goodwill follows quickly.

And there is little downside to this move. The demand and supply are both artificially up due to COVID-19. Both will move in tandem once things get back to normal, however long that may be. It would be easy to cut back on this expansion.

In every crisis, there are seeds of opportunity. Bezos intends to grow an oak tree from this one. An unprecedented disruption to business might end up entrenching the most powerful business of them all.

Random corner of the week

Want to completely check out from everything for 6 minutes? Watch this video of how Japanese handmade paper is made. It’s gorgeous cinematography and an homage to a long standing tradition of meticulous hard work.

Movie of the week

Mysterious. Unsatisfying. Beautiful. Those are the words that come to mind when I think about the movie Burning by Lee Chang-dong. It’s a story of class conflict, jealously, and one very eccentric hobby. Adapted from Murakami’s Barn Burning, the movie was a good watch and a welcome break from my back-to-back Succession re-runs (#teamkendall btw). I‘m guessing that your own opinion of the movie will be based on how much ambiguity you enjoy in your movies. You can stream it on Netflix.

Meal of the week

The shelter-in-place means I’ve gotten the chance to exercise my cooking muscles again. This week, my favorite meal was a simple rigatoni in vodka sauce with parmesan reggiano on top. Send me your favorite meals you’re cooking these days!

That wraps up this week’s Sunday Snapshots. If you want to discuss any of the ideas mentioned above or have any books/papers/links you think would be interesting to share on a future edition of Sunday Snapshots, please reach out to me by replying to this email or sending me a direct message on Twitter at @sidharthajha.

Until next Sunday,
Sid