A Random Walk Down Meme Street

Living in cultural index-fund Mary Sue civilizations

I’m in India, where the downside of the scorching heat is only just beaten out by the upside of being here during mango season. I am conducting certain experiments while I’m here. For science.

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The Contraptions Book club May pick is The Printing Revolution in Early Modern Europe by Elizabeth S. Eisenstein. Discussion starts May 25.

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Yesterday was a festival I was not aware existed, called Akshaya Tritya. That itself is not particularly surprising. The Hindu religious calendar is full of way more festivals than you can keep track of, which is why there are special calendars to keep track of it all.

But the reason I didn’t know about this particular festival is that it has only recently been adopted and reinvented by the commercial sector as an opportunity to sell gold and investments. Which means it now pops on the religious calendar.

The high concept behind the festival is that whatever you buy on this day, you will supposedly get more of through the year. It’s an abundance priming festival. TV and newspapers have been full of ads for gold in particular. India remains the world’s largest gold sink. Buy gold on Akshaya Tritya, get more gold through the year through divine favor. I don’t buy the theory of course, but I bought some good mangoes, and if I get more good mangoes through the year, I won’t complain.

This is newish, as of the last few years. Traditionally, afaik, there are no notable observances associated with the festival beyond “buy something you want more of.” It’s not like Diwali or Holi or any of the other big ones. I expect if it was observed at all when I was a kid, it likely involved no more than getting some payasam at lunch and not bothering to inquire why.

There are a dozen legends attached to the date, but the festival is named for the episode in the Mahabharata where, during their exile, the Pandavas receive an akshaya patra from Surya the sun god: a magical bottomless vessel that never runs out of food until all of them have eaten. There is more to the story, involving an angry sage, which you can look up if you like.

So this is the Abundance Festival. Indian edition.

The akshaya patra tale reminds me of a Russian folk tale with a similar premise, where Baba Yaga the witch shows up at a poor woman’s house one morning, gets treated well, and tells the woman “what you do in the morning, so you will in the evening.” The next morning, the woman randomly finds a gold coin, and weighs it in her scale. Miraculously, when she takes it off, the scales refill with more gold. She keeps weighing gold till dusk, getting rich. There’s more to the tale, involving a jealous sister-in-law, which you can look up if you like.

The motif of endless unearned abundance in these tales is interesting. Especially given the rise of Abundance Theology in America. Over the last few decades, we’ve seen an evangelical Christian version of it, a Trumpist version of it, and now we are witnessing the rise of a left-liberal Vox-Nisaken version of it. Arguably, between ~2000-20, we also witnessed a Chinese version of it. Wherever in the world I traveled, I seemed to run into shopaholic rich Chinese (and tourist/shopping sectors organized around their presence) filled with unshakeable and unfounded confidence in an indefinitely abundant Chinese future.

All these abundance theologies, like the Indian Akshaya Tritya festival and the Russian folk tale, are driven by dreams of abundance on autopilot. One Weird Trick you can pull to ensure indefinitely extended abundance.

Now, this wouldn’t matter much if there was nothing you could do about this wishful impulse other than try the ceremonial One Weird Trick on your local Abundance Day festival (I think it’s Black Friday in the US?). For the other 364 days of the year, you would still have to grind out your life, hustling and working, and figuring out your cunning plans to get ahead. You’d still have to live by no-free-lunch rules, and the world would go on in a more reasonable way.

Except there is a tempting candidate for a literal abundance hack — passive index fund investing. And we now have an analogous abundance instrument for culture — AI.

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I’m trying a new experiment with this post — it is mostly written by me, but I had ChatGPT beef up one of the sections, by adding additional supporting text (which you’ll see called out inline). Less than 10% of the word count, I’d guess. For now, I’ve still tagged this under sloptraptions, but in future, I think I won’t bother to call out such low-levels of generated text.

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What happens when the world revolves around really big Weird Tricks that promise endless abundance for little to no effort? What happens when those promises are based on actual features of the engines of the world, rather than mere religious beliefs? Features that come with a hidden price-tag attached?

Passive++ Thinking

The first time I thought seriously about investing was probably around 2008 during the early months of the GFC. At that time, I had my limited 401k in some sort of high-fee managed fund that automatically rebalanced itself for a target retirement date. My first deliberate act as an investor was a dumb one — cashing out of the market at the height of the panic. Later, thankfully, I bought back in (around 2011 iirc) early enough that I didn’t miss out on the decade-plus bull run that followed. And this time, I did it in what was then acknowledged to be the only smart way to do it — dump it all into the lowest-fee index-fund tracker (S&P in the US) my brokerage offered, and forget about it.

I did that because it was around that time that someone told me about Burton Malkiel’s classic, A Random Walk Down Wall Street, which basically says you can’t beat the market, so you might as well passively join it. Which I did. I made my wife do the same (like me, she had her 401k in some dumb non-index fund). Rather appropriately, I didn’t actually finish reading the book. I just bought its message and acted on it. Talk about passive investing.

A few years later though, as most of my work gravitated to Silicon Valley, I started dabbling in individual tech stocks with play-money levels of buys — FAANG mostly. This was more to stay attuned to the market with a bit of skin in the game than out of any desire for market-beating returns.

But this effectively acted as a kind of covered call. Or maybe an oveclocking. Or a front-running. Since the index was starting to get heavily dominated by the big tech stocks anyway, to buy more tech stocks was to bet that the index funds weren’t getting eaten by software fast enough.

Long story short, that was a good move in the 2013-16 era, and at least for the decade since, my index++ “strategy” if you can call it that, has handily outperformed the market. My small side-bets did so well, they were no longer side bets, and I had to do a bit of rebalancing. I’m still dominantly index-fund invested though. And I don’t claim to read any significant lessons in the fact that I happened to do better than the index. I could just as easily have done worse. I just wanted to not be 100% index-driven for some situation awareness, and a bit of gambling fun.

So maybe I should call it a “passive++” strategy. As far as I can tell, the strategic thinking behind the strategy is not much better than the decision to buy gold on Akshaya Tritya. It’s basically an act of faith in an abundance gospel. A bet on One Weird Trick that promises a free lunch.

I’ve unwound my techno-optimist positions a bit, and am sitting on more cash than usual in my 401k, with a vague plan to buy whatever dip follows the tariff war, but I’ll freely admit I don’t have a clue what’s going on or what’s about to happen. And moving some funds from the S&P to cash isn’t really that significant of a move, since both are assets whose value is tied to the American abundance gospel.

You see, as a passive++ investor, I’m not used to actually thinking hard about markets and such. I think more about it than the purely passive 100% index investor, but nowhere near as much as real investors. Praise Malkiel. But not 100%. Make fun of Buffett, but not 100%.

To a first approximation, for nearly 30-40 years, this has been the smart move. Use the index as the base, then play around a bit to the extent you have a taste for narrative gambling. I don’t know what passive investing looked like before index funds, but presumably there has always been a lazy++ strategy that basically worked (in India, it has historically been, “buy gold”). Thinking too much has been the dumb move.

But the world does seem to be changing in ways that might force even the lazy strategy to change. For a variety of reasons — more fundamental than even the “fundamental analysis” people think about — it feels like the party is over. Or at least headed somewhere random where it’s unclear how to follow the action in a passive++ way from the confines of a US-based brokerage account.

See the thing about free lunches and passive gains is that it’s usually some sort of free riding, and your ride may not show up one fine day.

Passive investing of course, is a kind of free riding. That’s always been the only significant criticism of Malkiel’s theory. His theorizing is basically correct as far as I can tell, as is the empirical support for it being actually the case. The weakness of the model has always been fragility on the normative rather than descriptive front.

In other words, what if everybody did it?

I mean, of course the theory doesn’t work if everyone does it. It’s a self-undermining sort of hyperstition as it approaches market saturation.

We Can’t All Free-Ride

Or to put it more starkly, what if everyone in India decided to buy whatever amount of gold they could on Akshaya Tritya, and then sat on their asses for a year?

You can see by inspection that this isn’t going to work. Someone has to be doing the thinking and working somewhere. Everybody can’t be a free-rider.

So one way to understand this: As more people switch into passive gear, we’re all piling into to a massively overleveraged bet on a shrinking base of people doing the actual thinking. And even if they’re geniuses, they’ll make mistakes, and then all the leveraged betting on their genius will collapse horribly.

So index funds present a weird sort of paradox. They save the average investor from dumb investments, and overall concentrate capital in consensus theories of long-term prosperity and growth. This bet is underwritten at a societal level by:

1. A minority of people doing some actual thinking

2. Some sort of collective lazy belief in “200 years of growth and progress” or such

So while the average investor behaves in a smarter way, the total amount of smarts in the market goes down. How is this possible? Because a smart move copying another smart move doesn’t equal 2 smart moves.

That second point is effectively an abundance religion, based on some vague theory or the other. God will refill your rice bowl. Baba Yaga will keep the scales filling up with gold. The stock market has historically returned 8%. Western progressive values drive progress. Western conservative values drive progress. Chinese virtues drive progress. Oil is Allah’s gift to Muslims. Yada yada yada.

I don’t really try too hard to unpack these narratives. I find them entertaining, but I take the raw data they rest on as just unexplained phenomenology with no particularly strong case for believing that even long-term trends must continue indefinitely.

Or to extend Burton Malkiel’s case to historical time-scales, perhaps historical economic trajectories are more of a random walk than we like to admit, and there is no strategy that can consistently beat “bet on all humans.”

Which means the history of the world operating at its best can be understood as:

1. A few humans somewhere on the planet actually doing something to live up to “human potential”

2. Everybody else free riding on some collective lazy belief in some bullshit idea like “the indomitable human spirit”

And when the world is not operating at its best, it is probably because item 2 gets replaced by a worse belief, like “indomitable spirit of Group X.” Which leads to the dangerous deduction that the few humans doing something to live up to “human potential” are going to predictably be part of Group X. Because Group X has been chosen by the cosmos to channel abundance onto our planet.

Which is a bit like buying into a high-fees managed fund sold to you by your financial advisor. Or buying books only at your precious local independent bookstore.

The small problem is that we periodically retreat from the as-good-as-it-gets index-fund historical narrative to dumber ones.

The big problem is that as-good-as-it-gets is sometimes not good enough. Because too many people have piled on too passively into too little thinking and doing.

Mary-Sue Civilizations

This, I think, is the main problem with abundance gospels. It’s always about a free lunch you can get a piece of by piling onto the hot streak of some random minority, enjoying some randomly bountiful circumstances, and then narrativizing free-rider results into a historical determinism and labeling it “progress” or whatever. As an optional extra, you can try to write yourself into the progress narrative as a paragon of the virtues it represents. After all, while everybody wants to free-ride, nobody wants to admit, even to themselves, that that’s what they’re doing.

This is the index fund approach to building societies. What I call Mary-Sue Civilizations. It’s not a terrible posture. At most it feeds conceits, encourages self-congratulation for doing nothing over dumb things, and obscures fundamental dynamics in favor of theaters of illusory agency. It gets idiots to stay out of the way (while believing they’re helping) so that the non-idiots can do useful things.

But sometimes it is not good enough. We can’t all be Mary Sues all the time.

/* begin ChatGPT-beefed-up section */

Because sometimes an “abundance gospel” doesn’t just nourish hope—it lulls an entire society into believing its own hype.

A Mary-Sue Civilization is one that writes itself into a deterministic progress narrative, congratulates itself for riding a free-lunch wave, and forgets how to do the hard work that actually generates resilience.

Consider the Dutch Republic at its height (circa 1588–1672). Flush with the spoils of global trade, dazzling art, financial innovation and scientific breakthroughs, it seemed unstoppable—until the Fourth Anglo-Dutch War (1780–1784) erupted and decades of complacency left its navy decayed and its treasury hollow. In just a few years the merchants who once set the pace found themselves scrambling for survival, victims of the very institutions that had promised “guaranteed” prosperity .

This pattern always begins with myth-making: a society adopts a self-fulfilling narrative of inevitable rise—“our model never fails”—and dissent or critique comes to seem not only unnecessary but unpatriotic. Elites and masses alike then lean on past momentum rather than forge new solutions, underinvesting in innovation while institutions calcify. When an external shock or strategic rival finally exposes the vulnerabilities that years of unchallenged confidence have created, the civilization finds itself with no adaptive muscle left.

It has lurched from genuine dynamism, through a Mary-Sue phase, to crisis.

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Can you do better than a passive index-fund type civilizational posture, and avoid or shorten the crisis before getting back to dynamism? Because sometimes you have to, or things fall apart.

I think so, but the answer isn’t investing in random penny stocks based on a misguided belief in your own stock-picking genius. The answer isn’t investing at all. Because investing by definition is a passive act of belief in somebody else’s activity (unless you count investing in yourself, which I don’t).

The only way to beat index-fund strategies is for more people to move from the passive to the active side of the ledger.

This is easier said than done though. Most people want to move from passive to active within the prevailing Abundance Theology. They don’t want to disrupt it to the point where they’re planting seeds of a new abundance they will likely not live to experience themselves, let alone be able to narrate into a new gospel.

This is the fundamental reason I don’t buy any abundance or dynamism theology right now. We’re witnessing the failure and collapse of the prevailing abundance theology in the US, and to a lesser extent, the world. Getting to a new one isn’t going to be as easy or quick as just making shit up and slapping a label on it.

It will take a generation or two of economic activity rather than economic passivity. You can’t passively invest your way into activity.

Don’t look at me. I’m a 50-year-old GenXer. This is your problem Millennials and Zoomers.

Cultural Abundance

We’re rapidly bringing another major index-fund type game online for the world — LLMs. As I argued recently, LLMs are basically index funds. And like index funds, they will be increasingly hard to beat.

A quick note here — LLMs aren’t the first index-fund-like cultural technology. Reading the Eisenstein book (this month’s book-club selection), I’m getting convinced that the Gutenberg revolution was also a major index-fundification of culture. More on that after I finish the book. Another candidate is the social media of the last decade — a human-powered index fund of roiling trends and currents in the zeitgeist. A random walk through meme street you couldn’t hope to consistently beat, only join.

The news on the cultural front is more cheery than on the economic front. On the economic front, late-stage index-fund economics indicate that we’re at the end of an abundance gospel story, where buying more S&P on Akshaya Tritya won’t save your retirement or the world’s economy. The party seems to be ending, and it’s not clear when and were a new party will cohere.

On the cultural front though, we’re just entering the index-fund phase, so we can expect a couple of good decades of partying. I hope.

By now, I’ve experimented enough with writing with LLMs (and as of last week, generating videos with LLMs) to suspect we’ll follow effectively the same trajectory. LLMs will become mechanisms for smart people to copy moves by other smart people. For a while, the cultural GDP will grow at a torrid pace, and we’ll come to believe in some sort of LLM-fueled cultural golden age (the ones who disagree will die, bitter and alone, clutching their illuminated manuscripts printed books in their small local independent bookstore, much like hand-scribed manuscript dealers in the 15th century, faced with the onslaught of the brash new sellers of printed slop books).

But inevitably, we’ll get to some sort of crisis. Fortunately it will be the Zoomers who will have to deal with that when we get to it. By that time, if I’m alive, hopefully I’ll be comfortably ensconced in my 3d-printed retirement pod, being tended to by my humanoid robot.

What does the coming cultural abundance look like? I saw some news item about some idiots with plans to “publish 8000 books” in the next year. That sort of uninspired slop-shoveling is not interesting, and not what I mean by cultural abundance. I mean real abundance that you and I, people with fine, passively cultivated tastes honed by Marvel movies, will actually enjoy enough to pay for.

Case in point: My best LLM-assisted short story is a straight-up transposition of an H. P. Lovecraft story to a different key. This is basically like buying into the S&P 500 of 20th century fiction. It is also among my best stories, period. For me, beating the S&P 500 of fiction is going to be hard. Doing passive++ investing in it is going to be easy though. With LLM-assistance, I can join the fiction-writing classes.

This means, as more people do stuff like this, we’ll cross a threshold into a period of genuine abundance. More of us will abandon our own crappy original story ideas and simply use LLMs to invest in proven good stories and character ideas. Like studio executives endlessly betting on reboots of known properties, we’ll all narrow our cultural ambitions, and enjoy more reliable returns. The history of printed media suggests this will be a good thing. For a while.

In fact, I suspect visionary owners of high-value IP will open up their properties to such “index investing.” Imagine if Marvel opened up all its IP for amateurs to make AI-generated short movies with, and even sell it. I suspect stuff like this will happen. I’d frankly enjoy a shot at writing a Mandalorian story and having it turned into a short TV episode that I can then try to sell to you guys for $1.

And of course, much more obscure and marginal IP might now be able to cheaply expand into textual and video extended universes. Instead of a big-money studio, it might only take a dozen index-fund type writers and Sora-wranglers to pool some money to create a proper extended universe.

I actually started sketching out such an experiment a few years ago, around the consulting short stories I used to write in my old Art of Gig newsletter (no longer online, or published, sorry), but the tech wasn’t there yet. It’s almost there. You just might see those stories brought to life on screen in the next few years. I need to find a way to load those stories (about 30k words worth) into a collaborative project AI thingie that can also pipeline into video generation easily.

Through developments like this, as in the case of index funds, the average story will improve, but the total amount of good original storytelling will shrink. Or not grow as fast, in relative terms.

Again, I want to emphasize, this is not new. The print revolution had a similar effect on 16th century literary/scholarly culture (what Eisenstein calls the Commonwealth of Learning, a phrase I identify with far more than the pompous Republic of Letters which came a little later).

2010s social media had a similar effect on cultural trendcasting. In a way, index++/passive++ investing is what I’ve been doing throughout my blogging and newslettering career. I just treated social media the way I do LLMs now. Many of my biggest hits of the last decade, such as Premium Mediocre, should be considered investments in the social media index fund. If you revisit that post, you’ll notice it’s built around responses to prompts originally posted on Twitter and Facebook, and a thesis developed around the responses.

As more of both reading and writing attention start to get mediated by cultural index funds in an LLM form factor, we’re going to see the same paradoxical effects as we did in the financial markets. Initially, there will be a big improvement, as average people with no hope of beating LLM performance cede their creative attention management as both writers and readers to LLMs. For almost everybody this will be a good thing. But all this will rest on a shrinking subset of people who manage their attention more directly and effectively.

Being on the active side does not mean not using LLMs. It’s more like the index++ or passive++ strategy I’ve been following for my retirement portfolio management. Or my social-media-riding blogging for that matter.

Dump the bulk of your creative attention into the cultural index fund, for reliable steady returns you can’t hope to beat. But do it with a high degree of mindfulness. Remember the slop comes from you, not the LLM.

And try to get ahead of whatever you see LLMs doing, by dabbling with individual investments on the margins that complement the “indexical” civilizational trends.

To actually enjoy the abundance while it lasts, you have to track the cultural index, and understand why it is doing what it is doing, and either hedge against it being wrong, or overclock what it’s doing to ride ahead of it, if it’s not believing aggressively enough.

This takes some work, but not a lot of work. You don’t have to kill yourself grinding, but maybe you can go beyond passive to passive++. From entirely free riding to getting off and helping push the cart sometimes.