Topley’s Top 10 – August 9, 2021

1. Another Look at Global Venture Capital Explosion.. Geographically speaking, almost half of that money has been invested in the US, with Asia picking up another 29%, and Europe 17%.

We’re running out of superlative adjectives to describe what is happening in financial markets these days. The latest stat that’s breaking our minds is that global venture capital funding hit $156bn in Q2 2021 (three months of April, May and June). That number breaks the record from the first quarter of this year when $136bn found its way into the coffers of promising startups looking to one day become the next letter in the FAATMAN acronym (thanks to CB Insights for the great data from their latest report).

Where did you come from?

Venture capital investors are able to add the odd zero to the end of their checks these days because investors are entrusting them with more and more money. Many asset classes, particularly stock markets and residential real estate, are at-or-near record high valuations. That means more capital is available to find a home in VC funds.

Where did you go?

Geographically speaking, almost half of that money has been invested in the US, with Asia picking up another 29%, and Europe 17%. In terms of industries, things are a little more fragmented. Around 20% of all VC dollars invested in Q2 2021 went into fintech companies, which is a pretty broad category that could include investing platforms, digital banks or innovative loan companies. E-commerce companies scooped $16bn, or about 10% of the total, as did startups working in the field of artificial intelligence.
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Topley’s Top 10 – August 5, 2021

1. Easy to Buy and Hold?  Amazon Average Intra-Year Decline 33%

Irrelevant Investor–The average intrayear decline for Amazon is 33%. Even if you take away the dot-com bubble, so after 2001, the average decline is 26.5%. Investors were rewarded for this risk, but each of these drawdowns was enough to test their endurance.

10 Reasons Why Stocks Fall Posted August 4, 2021 by Michael Batnick  https://theirrelevantinvestor.com/2021/08/04/10-reasons-why-stocks-fall/

2. China Small Cap Surviving.

China small cap down -18% vs. China Tech -55%

www.stockcharts.com

3. Ether Jumps as Bitcoin Alternative Stages Its Own Supply Rally

Bloomberg Vildana Hajric
Wed, August 4, 2021, 3:38 PM
(Bloomberg) — The digital currency Ether climbed to its highest level in nearly two months during the midst of a software upgrade that will trim the pace at which fresh tokens are minted.

The second-biggest cryptocurrency after Bitcoin rose as much as 10% on Wednesday to trade around $2,726, marking its highest point since early June. Bitcoin increased as much as 4.7% to $39,845.

In some ways, the optimism about the upgrade, known as London, resembles the hoopla surrounding past reductions in the block rewards for Bitcoin miners. While so-called halvings were planned events, Bitcoin typically rallied in anticipation that demand would either remain steady or increase while the pace of issuance slowed.

https://finance.yahoo.com/news/ether-jumps-bitcoin-alternative-stages-193845198.html

4. Top 10 Most Admired Companies in 2000. How were returns?

Daniel Crosby Orion https://www.linkedin.com/in/danielcrosby/

5. Robinhood Chief Legal Officer. $30m Compensation?

Scott Galloway No Mercy No Malice -Once, that type of disclosure would have dismembered an IPO. Instead, 48 hours after it made the disclosure, Robinhood was publicly trading at $32 billion. Telling point: The company paid its chief legal officer, Daniel Gallagher, more than $30 million in 2020, even though it hired him halfway through the year. From 2011 to 2015, Gallagher was an SEC Commissioner. Our business environment has morphed from capitalism, which depends on the rules of fair play, into cronyism.

https://www.profgalloway.com/hood/

6. Apartment Occupancy Hits 96.5%. No Houses and No Apartment Units Available.

Liz Ann Sonders Schwab

Data, apartment rents surged 14.6% y/y in June, most on record; occupancy reached 96.5%, matching prior high in 2000

7. Mortgage Debt Almost 70% of All Household Debt.

Ben Carlson A Wealth of Common Sense The Most Underappreciated Force in the Economy Right Now. Why low mortgage rates will be felt for years to come.

https://awealthofcommonsense.com/

8. Conservative/Liberal Culture Wars are Global

The Daily Shot Food for Thought: Countries with the highest tensions between liberals and conservatives:

Source: Statista

https://dailyshotbrief.com/the-daily-shot-brief-august-2nd-2021/

9. 5 Reasons to Say Goodbye to the Office for Good

Here’s why a full transition to remote work could work for your company.  

BY YOUNG ENTREPRENEUR COUNCIL@YEC

Credit: Getty Images

By Beth Doane, an award-winning writer, speaker and entrepreneur and CEO of Main & Rose.

WeWork CEO Sandeep Mathrani set off a firestorm of controversy this year with a statement that I think is as wrong as it was insulting to workers. When asked about his company’s return to the office policy, he equated a preference for virtual or remote work to laziness: “Those who are uberly engaged with the company want to go to the office…those who are least engaged are very comfortable working from home.”

Although it might be news to Mathrani, remote work is the future — not just for the duration of the pandemic, but for a generation to come. Studies show that by 2025, approximately 70 percent of the workforce, across industries, will be working remotely at least five days a month. In total, the percentage of those who will permanently work from home is expected to double this year, with the vast majority of remote workers preferring to maintain this situation. Another study shows nearly three-quarters of workers prefer to work fully remotely, with another 33 percent wanting to work from home several days a week. 

Leading the way on remote work is Big Tech. Both Twitter and Square have encouraged workers to continue working remotely for as long as they wish, with Facebook adopting a similar policy. Twitter in particular has been exploring remote work for years, calling flexibility for workers the “Fourth Industrial Revolution” because it will fundamentally change industries and how people work. 

At my firm, we have seen a huge influx of applications, as more and more people wish to work remotely. The simple truth is that just because companies used to operate one way, it doesn’t mean we have to operate that way moving forward. Remote work will be the primary disruption to come from the pandemic for most industries.

Based on my firm’s years of experience working with top clients while remote, here are the top five reasons why CEOs should think about ditching the office.

1. Remote work is more profitable.

In 2021, it no longer makes sense for most companies to waste valuable resources on real estate. Going fully remote eliminates this cost, increases efficiency by reducing wasted time on unnecessary meetings and also ensures that employers can invest in their employees, increasing retention and productivity. Studies suggest that if all of the approximately 48 million employees with a remote-work-compatible job worked remotely at least partially, employers could save more than $500 billion per year. 

2. Remote work encourages better mental health and performance.

Studies show that a stunning 95 percent of remote workers report being equally or more productive since leaving the office, with major improvements in work-life balance. Data also suggests that giving employees more autonomy and control over their lives improves morale and, therefore, retention and productivity. More than 80 percent of surveyed workers across industries say they would be more loyal to their employer if offered the option of more flexible work.

3. Remote work allows you to hire the best talent in the world.

When you’re remote, your talent pool is no longer constrained to your city or community — it’s now open to the world. In an era of digital connectivity, employers can hire the best talent anywhere, leading to more productive and profitable companies. Workers, too, can seek out employment in firms and industries that they have skills and passion for, instead of settling for convenience and making decisions based on logistical concerns, such as a commute.

4. Remote work can build a strong brand.

It might be counterintuitive, but remote work can be a powerful tool for strengthening a company’s brand. Virtual work requires more active engagement, but CEOs who seize this opportunity have the chance to build a resilient and attractive work culture and brand, which will also help with employee recruiting and retention. At my workplace, we advise clients to hold events like virtual happy hours and yoga that build and reinforce a brand and create a sense of community. Resources not spent on real estate or other costs can also be used on employees, including fun rewards such as concert tickets or weekend getaways.

5. Remote work increases equity and inclusion.

Even the most conscientious workplaces are vulnerable to bias and politicking that can sideline or disadvantage high-quality talent. Remote work can take human bias out of the equation and ensure that employees are hired and promoted based on merits. Remote work also opens the talent pool, meaning that employers can search for and hire a more inclusive and diverse workforce.

https://www.inc.com/young-entrepreneur-council/5-reasons-to-say-good-bye-to-office-for-good.html?cid=sf01003

10. The Highest Form of Wealth-Morgan Housel.

Wealth is Easy to Measure but Hard to Value–When George Vanderbilt moved into Biltmore – the largest home in America at 178,000 square feet – one newspaper in 1899 wondered what the point was.

The goals of the country’s richest during the Gilded Age, it said, seemed to be “devoting themselves to pleasure regardless of expense.” But often they got the reverse: “Devotion to expense regardless of pleasure.”

George didn’t spend much time in the 250-room mansion which, by the time he died, had nearly bankrupted him.

Twenty years before Biltmore was constructed, the New York Daily Tribune wrote that “The Vanderbilt money is certainly bringing no happiness to its present claimants.”

That wasn’t closet jealousy. Armed with the world’s greatest fortune, the Vanderbilt family seemed committed to proving the idea that money doesn’t buy happiness. They took it a step further, showing that when managed poorly money could in fact buy resentment, insecurity, and social anxiety. It could buy it in bulk.

Money buys happiness in the same way drugs bring pleasure: Incredible if done right, dangerous if used to mask a weakness, and disastrous when no amount is enough.

The highest forms of wealth are measured differently.

A few stick out:

1. Controlling your time and the ability to wake up and say, “I can do whatever I want today.”

Five-year-old Franklin Roosevelt complained that his life was dictated by rules. So his mother gave him a day free of structure – he could do whatever he pleased. Sara Roosevelt wrote in her diary that day: “Quite of his own accord, he went contently back to his routine.”

There’s a difference between working hard because you want to and working hard because someone else told you you had to, and how to do it, and when to do it. Even if you’re doing the same work, the independence of doing it on your own terms changes everything in the same way that sleeping in a tent is fun when you’re camping but miserable when you’re homeless.

To me, the highest form of wealth is controlling your time.

Wealth can lead to time independence, but it’s never assured. It can be the opposite, as whatever created the wealth – whether a company or an inheritance – creates a claim on your time in equal proportion to its financial reward. A great number of CEOs fall into this category: They have an abundance of wealth and not a moment of free time or scheduling control even when it’s desired, which is its own form of poverty.

Charlie Munger summed it up: “I did not intend to get rich. I just wanted to get independent.” It’s a wonderful goal, and harder to measure than net worth.

2. When money becomes like oxygen: so abundant relative to your needs that you don’t have to think about it despite it being a critical part of your life.

There’s a scene in the documentary The Queen of Versailles when the son of a man whose ability to make money was exceeded only by his desire to spend it, causing a family fortune to shrivel near the edge of bankruptcy:

On my wedding day my father gave a speech, and he looked at my wife and he said, “You will never have anything to worry about in your life.”

But now we worry every day.

A high form of wealth is avoiding that mess. And it isn’t necessarily tied to how much money you have.

Keep two things in mind:

  • Desiring money beyond what you need to be happy is just an accounting hobby.
  • How much money people need to be happy is driven more by expectations than income.

A thing I’ve noticed over the years is that some of the wealthiest people think about money all the time – which is obvious, because it’s causation. But it’s an important observation because most people, despite aspiring to become one of the wealthiest, actually want something different: the ability to not have to think about money.

It’s a different skill, but it’s powerful when you make it work. A person whose expectations relative to income are calibrated so they don’t even have to think about money has a higher form of wealth than someone with more money who’s constantly thinking about making the numbers work.

3. A career that allows for intellectual honesty.

This includes: Being able to say, “I don’t know” when you don’t know. Being able to speak critical truths about your industry without fear of retribution. The ability to make reasonable mistakes, and be open about them, without excessive worry. And not pretending to look busy to justify your salary.

There are high-paying careers that allow all those things. But there are so many that don’t, and a lot of what people pass off as “hard work” and “grinding” is just finding ways to bury the truth. A job that lets you be open and honest pays a bonus that’s hard to measure.

More:

Disclosure

Indices that may be included herein are unmanaged indices and one cannot directly invest in an index. Index returns do not reflect the impact of any management fees, transaction costs or expenses. The index information included herein is for illustrative purposes only.
Material for market review represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results.
Material compiled by Lansing Street Advisors is based on publicly available data at the time of compilation. Lansing Street Advisors makes no warranties or representation of any kind relating to the accuracy, completeness or timeliness of the data and shall not have liability for any damages of any kind relating to the use such data.
To the extent that content includes references to securities, those references do not constitute an offer or solicitation to buy, sell or hold such security as information is provided for educational purposes only. Articles should not be considered investment advice and the information contain within should not be relied upon in assessing whether or not to invest in any securities or asset classes mentioned. Articles have been prepared without regard to the individual financial circumstances and objectives of persons who receive it. Securities discussed may not be suitable for all investors. Please keep in mind that a company’s past financial performance, including the performance of its share price, does not guarantee future results.
Lansing Street Advisors is a registered investment adviser with the State of Pennsylvania.

Topley’s Top 10 – August 4, 2021

1. Transitory Inflation……S&P Real Earnings Yield Hits 1970’s Level.

Michaela Arouet

https://twitter.com/MichaelaArouet

2. Consumer Price Index (CPI)-Is the Measurement of Housing Costs Disconnected ?

Opinion: Shock: Rents rising three times as fast as ‘official’ inflation figures

Brett Arends

Another reason to own your home in retirement

Rise since January 2020 in the “Shelter” component of the official CPI figures, S&P/ Case-Shiller U.S. National House Price Index, and median listing prices at Realtor.com

If you want to be reminded why it’s such a good idea to own your own home in retirement, listen up to Matthew Fine.

He’s the guy who’s taken over Marty Whitman’s old mutual fund, Third Avenue Value TVFVX, -1.02% (up 66% in the past 12 months, incidentally). And in his latest letter to his investors he’s pointed out something that he has been watching and a lot of Wall Street hasn’t.

In a nutshell: The official inflation figures are a bit of a crock (my word, not his, of course). And the reason is that actual house price inflation is running way, way ahead of the official house price inflation.

Not sure where to live in retirement? Our tool can help you decide

You can see the numbers in my chart, above.

The number on the left is what the U.S. Labor Department, which compiles the official inflation data, says is the increase in housing costs from January 2020 through April of this year. (I’ve used what they call the “Shelter” number, which excludes all the other homeownership costs like utilities. This is just the cost of owning the home.)

The number in the middle is what the nationally-recognized S&P/ Case-Shiller U.S. National House Price Index says has happened to house prices over the same period.

The number on the right is what Realtor.com—which, like MarketWatch, is owned by News Corp. NWSA, +0.45% —says has happened to average listing prices over the same period.

Hmmmm.

Nothing to see here, folks! Move along!

Fine is an inflationista: He thinks inflation is likely to be higher than the Federal Reserve expects, and less “transitory.” He has a number of arguments to do with low, low interest rates, and material and labor shortages as the world reopens. But one of them is this issue with the official inflation figures and housing.

“As it relates to inflation as depicted by the Consumer Price Index (CPI),” he writes, “the measurement of housing costs appears to be substantially disconnected from reality.”

“The U.S. government has estimated rental rates for primary residences to be growing at 2% or less in recent months,” Fine writes. After talking to homeowners, he adds, it reckons “market rental rates for owner-occupied homes have been growing slightly above 2% recently and at a decelerating pace.”

I added the italics. You can see why. Have you seen any decelerating pace in real estate costs lately? Where are these people talking to homeowners?

And this isn’t trivial. Shelter costs account for about one-third of the total official inflation figure. Yet the government has to guess at it. The biggest number? They ask owners how much their home would cost to rent. Yes, really.

OK, so house prices and housing costs aren’t the same. You don’t have to buy a new home every year. The collapse in mortgage rates means your monthly housing costs go down, even if house prices stay the same or go up. This is why the government focuses on “rents” rather than purchase prices.

 But the numbers here aren’t that helpful for the Labor Department either.

According to the official figures from the Labor Department, rents nationwide rose about 2.5% in the 12 months to June.

But Realtor.com tracks rents too, using actual market data through its website, and it has a different inflation figure.

Try: 8.1%. Yep. In other words, the private market’s estimate of housing cost inflation is more than three times the “official” number.

https://www.marketwatch.com/story/shock-rents-rising-three-times-as-fast-as-official-inflation-figures-11627397608

3. Wall Street Buy Ratings Back to Highest Levels Since Internet Bubble Burst.

https://twitter.com/Schuldensuehner  Holger Zschaepitz

4. 10 Year Hit 1.13…Back to Feb. Levels

10 Year Treasury Yields.

www.stockcharts.com

5. Peaks in Early August are Normal Under New Party

LPL Research

https://i2.wp.com/lplresearch.com/wp-content/uploads/2021/08/8.2.21-Blog-Chart-2.png?ssl=1

6. Amazon Post Earnings Correction Put the Stock Back in Sideways 1 Year Pattern.

AMZN July 2020 to July 2021 in a Box

www.stockcharts.com

7. Capex is Set to Grow for Most Sectors

2021-2023 Capex Growth Sizeable

https://hsl-pnw-downloadable-files.s3.amazonaws.com/1181/c9988993-817c-4dcf-b17c-b9254b87f269-v12.0-66d03c143f724620a1ba4002a0952375.pdf

8. Ratio of MSCI China to U.S. Equities Lowest Since 2005

This weakness has pushed the ratio of Chinese to U.S. equities down to its lowest level since 2005.

9. New SEC Boss Wants More Crypto Oversight to Protect Investors

Bloomberg-The nation’s top securities regulator has unusual expertise in digital assets, but he says he’s no cheerleader for them

By Robert Schmidt and Benjamin Bain

It’s become a parlor game in Washington, on Wall Street, and in Silicon Valley to figure out where U.S. Securities and Exchange Commission Chair Gary Gensler stands on cryptocurrencies. Industry lobbyists tune in when he testifies before Congress. Lawyers parse his speeches. Goldman Sachs Group Inc. wealth advisers recently boasted in a research report about looking for clues in 29 hours of the Blockchain and Money course he developed at the Massachusetts Institute of Technology. That’s an arduous but perhaps not novel undertaking, since videos of the classes have garnered millions of views online, something that amazes even Gensler.

In his first extensive interview about the digital money craze, Gensler signaled that his deep interest in the subject doesn’t mean he’s simpatico with the hands-off oversight approach that many enthusiasts would like to see. Policymakers have struggled with how to respond to the mostly unregulated $1.6 trillion market, which has seen explosive growth and wild price swings. Gensler is contemplating a robust oversight regime, centered on establishing safeguards for the millions of investors who’ve been stocking their portfolios with tokens. “While I’m neutral on the technology, even intrigued—I spent three years teaching it, leaning into it—I’m not neutral about investor protection,” says Gensler, who on Tuesday gave a speech about crypto at the Aspen Security Forum. “If somebody wants to speculate, that’s their choice, but we have a role as a nation to protect those investors against fraud.”

Gensler has asked Congress to pass a law that could give the agency the legal authority to monitor crypto exchanges, but he says the SEC’s powers are already broad. There’s been much discussion over the years about which kinds of digital assets fall under the SEC’s purview. Some such as Bitcoin that act like currencies are considered commodities, not securities. But there are thousands of other coins, and Gensler believes most are unregistered securities that must comply with SEC rules.

Broadly he noted that technology has sparked economic progress throughout human history, and he sees a similar boost from digital assets. That may only come, however, with strong and thoughtful regulation. As an analogy, he says the automobile industry didn’t fully take off until governments laid out driving rules. Speed limits and traffic lights provided public safety but also helped cars become mainstream. “It’s only with bringing things inside—and sort of clearly within our public policy goals—that a technology has a chance of broader adoption,” he says.

Hester Peirce, a Republican commissioner on the SEC known for her advocacy of light-touch regulation of digital assets, says she’s eager to work with Gensler. “A lot people just want more clarity,” she says. “I come from a perspective that people should have the maximum freedom to engage in transactions they want to engage in voluntarily. Society needs to have that discussion about what is the right regulatory framework.

https://www.bloomberg.com/news/articles/2021-08-03/will-government-regulate-crypto-sec-chair-gary-gensler-on-bitcoin-and-oversight?srnd=premium&sref=GGda9y2L

10. The Science Of Sleep: 10 Surprising Health Benefits

Improved sleep habits can be a panacea for modern living. Thomas Rutledge Ph.D.

KEY POINTS

  • Sleep may be our most important health habit.
  • In lives dominated by mental and emotional stress, our need for sleep is greater than ever.
  • The most effective remedies for sleep are behavioral rather than pharmaceutical.

For all its amenities, modern life is surprisingly difficult. A century ago, the primary challenges of living were physical; we worked in factories or on farms, and housework and meal preparation demanded hours of labor. After many millennia of existence defined by dawn-to-dusk physical demands, the burden of modern living has been lightened by vehicles, automated devices, broadband internet, and same-day delivery services. Citizens from the 1920’s, however, would likely be disappointed to learn that a century of unparalleled technological progress has largely exchanged lives dominated by physical stressors with lives dominated by emotional and social stressors. It is difficult to argue that we are happier than a century ago and—despite having longer lifespans boosted by clean water and antibiotics—in most ways less healthy. The same technological forces that shaped modern times have offered many remedies to 21st century ailments. We have activity trackers to inspire exercise, social media to assuage loneliness, diet books and internet health gurus to guide our nutrition, and a dizzying number of entertainment options in the form of television channels and video games.

Yet for all these breakthrough gadgets and expensive technologies, arguably the most effective balm for modern living is sleep. No medicine, supplement, or psychotherapy provides even a fraction of the benefits conferred by sleep to our minds, bodies, and spirits. While a profit-hungry industry strives to create market demand for sleep products, the wise consumer appreciates that healthy sleep is overwhelmingly the product of cost-free habits and lifestyle practices rather than equipment or pharmaceuticals. We know what works: regular sleep and wake routines; morning sunlight to optimize circadian hormones; regular exercise to generate physical fatigue and ameliorate stressmeditation and relaxation for calming the mind; cool and dark bedrooms to facilitate restful slumber; and consistent CPAP use for those with sleep apnea. For the typical person, their sleep can be dramatically improved by the practice of these latter strategies without lightening their wallet. Recent science further demonstrates the diverse ways that sleep improves our well-being. The range may surprise you; virtually no area of physical or mental health is exempt from the effects of sleep.

A summary of sleep science

1. Sleep and pain sensitivity: Even a single night of poor sleep reduces our pain threshold. A study by Matt Walker’s team at UC Berkeley showed that, compared to brain function after a full night’s sleep, pain-related areas of the brain were 42 percent more sensitive to pain stimuli induced by laboratory tests. For context’s sake, a 42 percent difference in pain sensitivity is larger than the effect of many pain medicines.

2. Sleep and alcoholThe relationship between sleep and alcohol use is complex. On one hand, small amounts of alcohol show short-term benefits in helping some people initiate sleep (this benefit wears off, however, for most people within a few days). In contrast, any benefit from falling asleep faster may be nullified by the suppression of REM sleep caused by alcohol. The alcohol-REM suppression effect appears to be dose-related. For example, REM sleep may rebound to higher than normal levels in the second half (i.e., catching up on lost REM) of the night after smaller doses of alcohol have been metabolized. In the case of higher doses of alcohol, however, REM suppression may occur throughout the night as is often seen in persons with alcohol dependence.

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3. Sleep and caffeine: With an estimated 90 percent of Americans reporting daily caffeine intake, it is important to understand the effects of caffeine on sleep and health. Research shows that caffeine has an average half-life (the time needed to metabolize 50 percent of the drug) of approximately five hours. However, due to differences in drug metabolism between people, this can range from one and a half to nine and a half hours! In real-life circumstances, this means that the average person consuming a cup of coffee at noon (about 100 mg of caffeine) would still have about 50 mg of caffeine in their body at 5 p.m. and 25 mg at 10 p.m. These results, however, would vary markedly for slower caffeine metabolizers, who might still have a high percentage of caffeine affecting their body in the evening. For these reasons, many researchers encourage stopping caffeine use at least six hours before bedtime.

4. Sleep and vaccine response: In a world dominated by pandemic news and recommendations to vaccinate, a curiously overlooked fact is the importance of vaccinating in a well-rested state. Quality sleep profoundly affects the ability of our immune system to mount a favorable response to vaccination. For example, in one of several studies measuring immune system response to flu vaccines, a group of healthy participants restricted to four hours of sleep for six nights showed less than half the number of antibodies ten days after vaccination. Expressed reversely, this implies that receiving a vaccination in a well-rested state could double its effectiveness.

5. Sleep and learning: Practice does not make perfect. More accurately stated, it is practice—coupled with quality sleep—that enables learning and improvement. In a 2002 study of participants assigned to a motor learning task combined with differing sleep-wake patterns, participants obtaining a regular night’s sleep after learning showed a 20 percent improvement in the task the next day. In contrast, participants staying awake for the same period showed no improvement. Interestingly, more than 50 percent of the improvement could be explained by the amount of stage 2 non-REM sleep that is typically obtained early in the night.

6. Sleep and dementia: Because the brain is an energy-intensive organ, it produces a lot of metabolic waste products. Sleep serves a vital restorative function by facilitating the removal of the waste products accumulated in the brain during the day. Without sleep, this cleaning process does not occur, with potential long-term implications for dementia. For example, in a 2018 cross-over study assigning participants to a normal sleep versus a single night of sleep deprivation, the latter condition was associated with significantly reduced clearance of β-amyloid, a plaque associated with risk of Alzheimer’s Disease.

7. Sleep and hormones: One of the primary roles of sleep is hormone regulation. Optimizing sleep improves the function of appetite hormones such as leptin and ghrelin as well as sex hormones such as testosterone. Even in young men, sleep loss rapidly disrupts hormone function. In a study restricting sleep to five hours per night for one week in a group of healthy men in their 20’s, daytime testosterone levels were lowered by 10-15 percent and accompanied by large self-reported decreases in vigor.

8. Sleep and healing: Whether you are an athlete recovering from training or a patient recovering from surgery, sleep is critical for your body to heal. In addition to the above hormonal and immune system effects of sleep, sleep is also the period of peak protein synthesis. Protein synthesis is the process of creating new proteins and is an essential part of repairing damaged tissues and creating new cells. A 2021 study recruiting healthy young adults found that a single night of sleep deprivation decreased protein synthesis by 18 percent, along with a 21 percent increase in cortisol and 24 percent decrease in testosterone.

9. Sleep and heart rate variability: Heart rate variability (HRV) refers to beat-to-beat variability between heartbeats. Counterintuitively, greater HRV is healthy, representing a dynamic heart capable of responding effectively to internal and external demands. Low HRV is associated with poorer metabolic function and increased risk of cardiovascular events. Improving the quality and quantity of our sleep is one established way to maintaining higher levels of HRV and it is never too young to start. Even in children and young adults, for example, research shows that impaired sleep is associated with reduced HRV.

10. Sleep and insulin sensitivity: Even partial sleep deprivation has rapid adverse effects on insulin sensitivity. For example, in a crossover study of participants with type 1 diabetes obtaining full and four-hour sleep intervals, insulin sensitivity was reduced by more than 20 percent following the night of partial sleep deprivation. Many other studies with type 2 diabetes and even metabolically normal participants show similar results. For comparison’s sake, the improvement in insulin resistance achieved by healthy sleep is as large or larger than established diabetes medicines such as metformin.

Disclosure

Indices that may be included herein are unmanaged indices and one cannot directly invest in an index. Index returns do not reflect the impact of any management fees, transaction costs or expenses. The index information included herein is for illustrative purposes only.
Material for market review represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results.
Material compiled by Lansing Street Advisors is based on publicly available data at the time of compilation. Lansing Street Advisors makes no warranties or representation of any kind relating to the accuracy, completeness or timeliness of the data and shall not have liability for any damages of any kind relating to the use such data.
To the extent that content includes references to securities, those references do not constitute an offer or solicitation to buy, sell or hold such security as information is provided for educational purposes only. Articles should not be considered investment advice and the information contain within should not be relied upon in assessing whether or not to invest in any securities or asset classes mentioned. Articles have been prepared without regard to the individual financial circumstances and objectives of persons who receive it. Securities discussed may not be suitable for all investors. Please keep in mind that a company’s past financial performance, including the performance of its share price, does not guarantee future results.
Lansing Street Advisors is a registered investment adviser with the State of Pennsylvania.