Herodotus’ River Horse
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I was in South Africa on a site visit recently and saw a hippo. I’m a big advocate for the fact that we can learn a lot from nature as well as it giving us requisite space to think and reflect.
So, what came into my head while watching a hippo from the side of a watering hole?
1. All is not as it seems
The word hippopotamus was coined in Greek, by Herodotus. This man had almost certainly never seen a hippo but had heard about one from various, and unreliable, sources. The word directly translates to ‘river (potamos) horse (hippos)’. His description of one includes cloven hoofs like an ox, with a horse's neigh, mane, and tail.
Despite this less than accurate description, we still use Herodotus' name for a hippo today. What can we learn from this?
a) No matter how many people tell you something, that doesn't mean it is based on facts or first-hand information. It's always best to go and look for yourself. Spend some time in the weeds, or indeed, in the reeds like a hippo. Most people are aware of the danger of the echo chamber, but they are not always aware when they are in one. At inthallo, we make a point of seeking out contradictory opinions to challenge our preconceptions in the knowledge that we are often wrong.
b) To most, it doesn't matter if something is very wrong, as long as it is roughly right. Did Herodotus accurately describe a hippo? No. If you squinted at it from far away, would it do? Probably. Let's stick with it. The human brain loves shortcuts. We have to learn and judge which are useful and which will send us the wrong way up a wild goose chase. In an industry dominated by screens and quant models, stocks get quickly lumped into categories that shouldn’t define them.
Take a company like Illumina, a leader in next generation gene sequencing. It is at the forefront of what remains a nascent industry, yet one that is still subject to the cyclicality of lab spending. Why should we treat this latest cyclical trough as doomsday for a firm at the forefront of growing industry that could completely change both diagnostic and therapeutic landscapes.
2. Ideas, like hippos, must be watered
Herodotus also coined the word for history on publishing ‘The Histories’ in c430BC (featuring above description of a hippo). The word comes from the Greek (historiai) meaning, inquiry, examination, or systematic observation.
The process of systematic observation is very much what we try to do at inthallo. It is why I believe a humanities degree is such good preparation for the world of investing. We take large amounts of information from dubious sources and try to build a world view and investment case. This involves deep research on individual stocks and topics, but equally important is the need to contextualise findings in the broader world and market. It is why we fundamentally believe in the strength of being a generalist and embracing diversity of thought, background and opinion.
Hippos cannot survive for more than 2 weeks without immersing themselves in water. Similarly, ideas that are not contextualised in a greater pool of knowledge, quickly distort, shrivel, and are rendered useless. You can do some of the very best research, but as long as you remain siloed, your capacity for decision making can remain limited.
What use is hydrogen fuel cell technology with no useable sources of hydrogen? What do changes in compound semiconductor materials teach us about the future of wearables and impacts on health-tech incumbents? If big tech become a more powerful lobbying group than big oil in the US, what does this mean for the future of nuclear, and does the dawn of new nuclear tech mean we no longer need to mine uranium?
You can do some of the very best research, but as long as you remain siloed, your capacity for decision making can remain limited.
3. The world is full of contradictions
Hippos are herbivores, yet are far more deadly than lions or crocodiles. They can look ungainly, but are very fast. They can't swim, and yet still sleep underwater. The world is full of contradictions and to even attempt to understand the whole of something is to accept this fact. At inthallo, we try to make sure we can hold many contradictory opinions at once and be ready to admit that long held beliefs might be wrong. To be able to do so is critical to being able to analyse the world around us. The world has many truths, and they don't always point in the same direction. What may be true today, won’t necessarily be true tomorrow.
The answer to most questions is that there are many answers. Is North Sea gas green? No. Is it greener than importing LNG from North America to the UK, or buying imported manufactured goods that are powered by coal? Yes.
The world has many truths, and they don't always point in the same direction. What may be true today, won’t necessarily be true tomorrow.
So Herodotus correctly describes the existence of a large water animal which he calls a horse (hippo). His description was, however, wrong due to his understandable reliance on information from others. Today, we have more, better and fuller information than in any other time in history. However, the availability of information does not necessarily correlate with its truth or utility. Similarly, a short term share price performance does not indicate long term success or failure.
In times like these, the world can seem irreparably divided, and markets inextricably confused. The ability to think critically, evolve, and learn from all around you, are key tools in combatting this. At inthallo, we strive to embed them in everything we do.
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Something to reflect the insatiable nature of capitalist greed
By Grace Ramsay
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