Top Reads, Listens, Follows & Takeaways of the week
Another spiral on the cost of education
Takeaways:
In reading SK Ventures' recent piece about the potential impact of large language models on the cost, volume, and value of software, I was sucked back into a spiral of disbelief about the cost of education. How can it be that technological innovations may significantly deflate (or eliminate?) the cost of the entry level white collar workforce in the near future, yet teaching 18 - 22 year old’s rote academic topics continues to rip higher in cost?
My issue is perhaps semantic, but important. The cost of getting educated on any topic is now near zero because of technology. Between Khan Academy and YouTube anyone can learn almost anything, whether that’s financial modeling or changing motor oil, in a scaled, cheap, and efficient way. So it’s not the cost of education that’s continuing to inflate. It’s the cost of the credential, with the accompanying network and signaling value, like a luxury goods brand, that appears undisruptable.
Two-thirds of employers require a degree for entry level roles. Until the skills candidates possess are emphasized by employers over the credential vouching for those skills, this inflation will persist. The only hope for deflation in education credentialization is a private sector rethink of employment assessments and requirements, which if adopted widely, could crush the businesses (colleges) pumping out overly expensive college credentials relative to their signaling value and network.
This chart should be edited to include a deflationary trendline for education, and a wildly inflationary trendline for education credentials.
Reads:
Psychological Paths of Least Resistance by Morgan Housel (here)
SK Ventures on Society's Technical Debt and Software's Gutenberg Moment (here)
The Unraveling of the U.S. News College Rankings (here)
Taylor Swift Built a Real-Estate Empire Worth North of $150 Million (here)
The Evidence Against Favoring Dividend-Paying Stocks by Larry Swedroe (here)
Listens:
Cliff Asness on Quant Value Investing and Trend Following (here)
Josh Wolfe and General Tony Thomas - Past, Present, and Future of Defense (here)
Morgan Stanley's Mike Wilson & Meb Faber talk markets (here)
Ryen Rusillo and Todd McShay break down the NFL Draft (here)
Follow, Watch & Other great content:
60 Minutes: How the U.S. is preparing amid a naval buildup in China (here)
What "Improving Your Engine" for CrossFit Actually Means (here)