Deconstructing Success Down To The Psychological Level - Morgan Housel

who are the rational optimists I I came up with the term rational Optimist I don't know if I did but I don't know if I came up with the theory but my idea was if you think the future is just going to be great that's not optimism that's complacency my my definition of rational optimism was you you think the future is going to be better than it is today but the path between now and then is going to be a disaster it's going to be a constant field of landmines and setbacks and recessions and bare markets and pandemics and wars and terrorist attacks that you have to endure financially psychologically career-wise in order to get the reward of optimism on the other end so it's like getting optimism in pessimism to coexist that I think is realistic optimism yeah it's like the looking at Price goes from here to here but it doesn't go like that price goes from here to Here by going yeah of course you see it in the stock market where you know over a 10 or 20 year period you can make a crazy amount of money but in any given month in any given week in any given year sometimes even any given decade it's a disaster and that's the price you have to pay in order to get the the returns over 10 or 20 years so we went through some of your book same as ever one of my favorite things everyone needs to go and buy it now it's super easy read very very enjoyable next lesson I want to go through is when the magic happens stress focuses your attention in ways that good times can't there's so many examples in history of the world going through a crazy tragedy Wars pandemics awful things happen millions of people die and then you look back 20 years later and you realize that because of that incident because of that war because of that pandemic there was this crazy amount of innovation and technology that took place because people were panicked and the incentives to innovate were off the charts and you look back and you're like look as terrible as that was we created because of that all these inventions that everyone benefits from today the most technologically Innovative period in I would say human history took place in the 1930s and the 1940s the Great Depression and World War II it started with the Great Depression which was in analytical terms the most like the the amount of productivity that increased in 1930s is more than any other decade that's taken place because it was all by necessity every single business in America in the 1930s woke up and they were like if we don't become more productive today we're out of business tomorrow so every business learned how to become more efficient and what came from that was the supermarket laundromat all these new businesses that were just designed to become more efficient the um the factory line really exploded during this period what Henry Ford did with the factory line uh in the 1910s and 1920s every business took up in the 1930s out of necessity World War II comes along and the incentives that happened because of that were just completely off the charts during Good Times boom times people's incentive to innovate is if I create a new product I might become rich that's your incentive and that's a good incentive you'll get people moving in that world in the 1940s it was if we don't innovate and figure out new technologies Adolf Hitler is going to control the entire planet that was literally what was going on back then so the scientific Community the government businesses overnight they were like all hands on deck we need to innovate like there's no tomorrow and what came out of that in a very short period of time I mean I've summed it up like this world wari began in 1939 on Horseback it ended in 1945 with nuclear vision and what took place in those six years what do we get out of it nuclear energy Jets Rockets penicillin like all of these things that benefit the world in massive ways today and it specifically happened because people were panicked you can also Imagine a world it's too early in which 20 years from now we look back at covid and say like look because of what happened in 2020 there was probably years worth worth of vaccine mRNA research and understanding that got compressed into like 6 months and you could imagine a world it's so consistent with history where we look back and we're like look covid was terrible and shut the world down and millions of people died but look what we got out of it because of this happened you could even say something about work from home and like just like the change in culture that sped up during that period so it's kind of this idea it's too much to say a silver lining of World War II you don't want to go that far it's a terrible thing but it's this thing of like be careful what you wish for like Society improves when the world is on fire not when everyone's is happy and their bellies are full and everyone's gainfully employed that's when the magic happens what what are the regular elements of when the magic happens is it uh being time bound is it people just being panicked is there some sort of a threat like what what are the uh motivators I think it's the power of incentives and mainly it's the downside incentives when the economy is strong you have positive incentives if I innovate I might get rich if I don't innovate I'll still probably be fine when you have the Great Depression or a war it's downside incentives it's if we don't innovate we're all going to go out of business we're all going to die we're all going to be taken over that downside incentives is what people it gets people to be like oh [ __ ] we need to go now this is not a nice to have this is a survival we need to go and so for example in the 1940s during World War II the scientific Community was like literally digging through file cabinets of like what are some like scientific papers like what did we discover 30 years ago what's this thing about splitting atoms like let's try to do this one right now and they just went full bore and you see what humans are capable of during a period like that now there's a limit to it if you're if you are too stressed under too much pressure it all breaks down so not a lot of huge scientific Innovations in the 1940s came out of Europe with some exceptions but that was too much trauma too much tragedy the United States was like we were panicked but there was not physical destruction of our factories so like we could keep it going what are the costs that people pay for this like there has to be reason why we're not moving at that pace all the time despite the fact that it seems to give great returns so there has to be some sort of downside which is disincentivizing people from doing it when we're not facing a war or a pandemic or a Great Depression I don't know if there is a financial cost that you could put to it but I think it is that the opposite of stress induced Innovation is when the is really strong like right now and in relative terms everyone becomes fat and happy and they don't have the they don't wake up every morning a little bit panicked I mean I think most people will see this in their individual lives where during a recession even if you have a job you're like this is kind of hanging by a thread here I I got I got to really show up early be the first one for the office and work really hard in a way that you don't tend to see that when everything is going well so it's less about like what I think the cost uh during Good Times is just like the cost of of things going well which is just like a lack of urgency to get moving I mean the the extreme example of this would be the trust funer who has like no downside if if if if they if they wake up and don't innovate don't find a new job they're fine nothing nothing bad is going to happen to them and you see this in like companies that are big and rich and successful they kind of atrophy over time and you compare that to the scrappy startup it's night and day I had Mackin Murphy who's a behavioral ecologist halfway between uh behavioral economics and evolutionary psychology sat in that seat he was telling me that as the economy gets worse the average BMI of women in Playboy and centerold Mags goes up and as the economy gets better the BMI goes down so there is a relationship between uh male preference for female body size and resource scarcity if during periods of Highly scarce resources where the future is very uncertain you see a woman that is able to hold on to her body fat you think wow I mean what an amazing hunter gatherer she would be phenomenal to be with me this would be great and they've done this um in phenomenal study in canteen Halls of universities and they would show guys images of women before they had dinner and then in different iterations after they had dinner and when they were hungry before they had dinner they picked girls who were bigger I mean this has been well known that like in in way earlier times hundreds of years ago thousands of years ago that women who were a little bit heavier were the more attractive ones they were the healthier ones there were and the skinny people were the ones who were like maybe facing famine and then so it's it's a pretty recent phenomenon of like a preference for thinner women over time that's a new thing one of my favorite quotes from when the magic happens is the same people with the same intelligence have widely different potential under different circumstances this ability to sort of unlock that that was already there yeah uh because of the external pressure we were talking last night about um uh good heart's law um when a measure becomes an outcome it ceases to be a good measure but a similar one is Parkinson's law right uh work will expand to fill the time given for it yes and this is kind of like all of these things just coming down on top at the same time I mean there's stories during World War II when FDR would be like we need to start producing 20,000 planes per year I think was the number and everyone in the room was like Mr President the absolute maximum we can produce is 5,000 per year and he was like 20,000 a year go do it and they figured out a way to do it they fig if they're like it's so cliche that if there's a will there's a way but you see what people are capable of during those periods and again I think that's it's been true for my life I'm been sure it's true for your life during periods of things are going well or like I got some big risks in my life right now what you are actually capable of doing like changes dramatically the uh biography the Isaacson biography of musk I think can be summarized as make insane Demand with ridiculously short timeline and continue to push people until it happens yeah under deliver a a little bit but only by your own insane metric and what that results in is you overd delivering buing a ridiculous margin yeah I know there's stories of musk building particularly at SpaceX where someone would come to him and be like hey this part cost $3,000 and Elon will be like that part should cost $20 you need to go build it and they're like there's no they're like $20 go build it just just like FDR and they eventually figure it out like they eventually do it and it makes you realize like how much in life is an artificial constraint of laziness of like maybe that's the wrong word but like a a good enough ism that if that is taken away you realize you're capable of literally multiple times what you think you are overnight tragedies and long-term Miracles good news comes from compounding which always takes time but bad news comes from a loss in confidence or a catastrophic error that can occur in the blink of an eye so think about the really bad things that have happened in modern times Pearl Harbor September 11th Co they they literally happened in an instant particularly Pearl Harbor in 911 it was like one hour everything was fine and the next hour the world had gone to hell and there is no equivalent of that with good news what is the good news equivalent of Pearl Harbor in which at 9:00 a.m. everything's okay and 10: a.m. everything is amazing there's no equivalent on the other end good news tends to take a lot of time it tends to play out slowly over the decades so one of the best pieces of news to happen in our in our modern times is the massive decline in heart disease mortality it's declined like more than 70% since the 1950s it has saved Millions of lives because we're better at controlling blood pressure back in the 1950s if you had a heart attack you're you're dead whereas now if if you make it to the ER on time there's a good chance you're going to pull through they're going to get you out of it made massive strides but we tend to ignore that because what happened is over the last 70 or 80 years heart disease mortality improved like 2% per year and in any given year you're never going to hear about that there's never going to be breaking news on the New York Times Like heart disease mortality improves by 70 basis points you'll never hear about that but the bad news is that happens quick you can't look away from it and so I think it leaves people more pessimistic than they should be because they are constantly bombarded by the bad news that happened very quickly and you can't ignore and the good news that is a slow compounding over 50 years it's so easy to ignore even if over time that good news is so much more powerful at like improving lives than the bad news that happens quickly overnight tragedies and long-term Miracles such a lovely beautiful framing do you know the differ in climate related deaths over the last 100 years it's decreased by 50 times much of it used to be called a 98% decline no this is through climate Mastery so this is um people that live in hot places being able to cool themselves down and people that live in cold places being able to warm themselves up 98% reduction in the last century of people dying from climate right it makes perfect sense when you say it and yet here look at all of the people that are dying from climate not to say that climate change isn't something that we need to address right but it's so it's this overnight tragedies and long-term Miracles that's exactly in a single Incident That's occurring at the same time yeah and you're like hang on a second how can the climate related Mastery reduction in deaths be 50 times better like 98% reduction but it's also the thing in the world and it's killing everybody in in poor countries happens so slowly you don't hear about it now there is some bad news that plays out slowly over time if you smoke cigarettes that's that's like a slow compounding and eventually the bad news might hit you in a jerk when you die of lung cancer after 30 years hon but you're doing damage at a slow rate maybe so would um climate change moving forward as externalities that might be an interesting one look at all of this energy we've got look at how we've fixed the and it's like ah yeah but there's this like weird just number that keeps ticking up the [ __ ] CO2 PPI and the uh sea level and a couple it's a you know it's whatever but that's the sort of thing that given enough time would be a a long-term tragedy yeah so there are a lot of those things where by the time you do notice it you're like oh okay that that that is a big deal now now I can see it I get it now why does bad news stick out so much is it just because it's more Salient to us I think it I mean it's always true from an evolutionary perspective that bad news is gonna kept capture your attention threats are going to capture your attention more than opportunities because in order to get the opportunity you have to first survive the threat so that's it's always been like that but I think the biggest reason it occurs is just like we said like the bad news is happening so fast you can't look away from it it's true in the stock market as well there are historically over time there have been days months weeks where the stock market Falls 10% 20% during Co the market fell 40% in four weeks something like that very rarely if ever will that occur on the way up almost no examples of the stock market Rising 40% in one month will never happen so like the ability to go down very quickly I mean it's the classic cliche I think it's um escalator up elevator down kind of thing is usually how it works but I think that's a good analogy for how a lot of things work in life too it's just like the speed at which they occur gets your attention much much more tiny and magnificent when little things compound into extraordinary things I think it's it's pretty common to think that a big event in the world has to be caused by a big action that if you're going to have a major war a major recession it has to be caused by something enormous that is causing that thing to happen it's usually not the case it's usually a bunch of really small things that interact in the right order that create this massive event I mean this is definitely true during the Great Depression like the biggest economic Calamity in the history of this country and what was it caused by you had a stock market crash well those happen all the time you had a bank run those happen all the time you had had a dust bowl that was like kind of was a dust bowl the Dust Bowl was a period just around here in the middle of the country where I mean the backstory is uh after World War I or during World War I farmers in the United States were heavily incentiv and incentivized to plant crops because we were trying to feed the starving Russians during this period so the US government came in and said as much corn as you can grow we'll buy it from you I think it was $2 per bushel at the time something like that so tons of farmers that's a premium presumably it was huge premium tons of Farmers from all over the country came to Kansas and Oklahoma and just planted planted planted way too much corn and they were terrible Farmers they were just like plowing up land in the most like voracious way that they could and then it all kind of stopped and they all bailed and left these fallow fields to just sit there and kind of uh dry up so they got Dusty and then you had these massive dust storms that would that pretty much wiped out a region these dust storms that were just like as apocalyptic as you could imagine how did that impact the economy the entire farming region in the Bread Basket of the United States that was producing all this G was just wiped out I mean literally just covered in dust uh and wiped out I mean a huge portion of the people and so many of those people ended up just just abandoning it there was no way you could make a living here anymore so that happened at the same time that you had a stock market crash and a and a banking run all three of those things individually would have been bad but then happening at the same time you get the Great Depression and I think there's a lot of incidences like that over time one of the most interesting ones was during the 1950s when we were experimenting with nuclear weapons and this was the nuclear Age of War we started to build really small nuclear bombs the idea was yes we can have a nuclear bomb that one bomb can wipe out a city but we also want to use this technology for more like tactical Warfare and they came up with really small bombs one of which you could literally launch off of a shoulder fire like bazooka and it would it was a nuclear bomb but it was like a very low yield so it would it do a lot of damage but this was not like like thermonuclear weapons and the idea was like oh great like we can use these tactically there's a joke that they even came up with a nuclear hand grenade but they couldn't find anyone dumb enough to throw it which was the joke at the time but the idea was that small nuclear weapons would be safe to use but the actually they were actually the riskiest thing in the world because mutually assured destruction was was a real thing and it made it so that the Soviets and the United States were not going to launch a thermonuclear missile and wipe out a city cuz the other would just retaliate and the world gets wiped out but if you had a small nuclear weapon that you were going to use would you use that like the barrier to using that was much lower but then if the Soviets used a small nuclear weapon on us would that justify us to use a bigger one absolutely the Cuban Missile Crisis in the 1960s the missiles that Russia had uh you know lined up to the United States point at the United States were in order of magnitude lower yield than what we we used in Japan during World War II way smaller the bombs that they had but if they launched one of those we would have retaliated with the full force the biggest bombs that we had so these like what created the biggest risk in nuclear war were not the big bombs it was the small bombs that we were actually more likely to use and so you have this tiny thing that were like oh it's a it's a nothing it's a nothing Burger but that was going to be the trigger to actual nuclear warfare I just read this recently this is not in the book the guy who invented the machine gun his last name was Gatling the Gatling gun uh he actually invented with the idea that the machine gun would end all wars because it was so destructive and has it was such a killing machine that every country would look at it and be like we can't go to war we're just all going to get wiped out it's too deadly now and so you have all these things that little do you know Mr Gatling beginning of it you won't believe what happened next yeah yeah and so you have all these things where someone creates something that they either think is small or they're like oh it's not that big of a deal to use it but it just like compounds into a much bigger thing so fascinating so take away from all that to me is like people underestimate the odds of big events because you think a massive recession needs to be caused by like an economic meteor and it doesn't it can be like five small events compounding at the same time in just the right order that set offs a chain reaction but this is evolution as well right this is how you go from single cell eukariotic to procaryotic or the other way around bacteria in a vent somewhere to me and you sat in front of microphones having chat yeah it's never yeah and like I think if you are a skeptic of evolution it's because you think you make the jump of like how do we go from a frog into a human that makes no sense but you're like well if you have 0.0000 infinite change in every generation and you compound that for a billion years then you get something great it's like the tiniest little thing for a massive amount of time you get something amazing Elation and despair progress requires in optimism and pessimism to coexist I hearing this story from Admiral Stockdale who was um the highest ranking uh p in Vietnam and he was talking after he was released he was talking about how some of the PS behaved when they were in prison and he said do you know who did the worst as a p it was the Optimus because the Optimus would say we're going to be home by Christmas and then Christmas would come and go and they were just crushed they were just destroyed and he said the people who did the best were like the rational optimists as I would Define it it' be people who would say we're going to go home by Christ no no I'm sorry they would say we're going to go home eventually this war is going to end and we're you're going to see your wife again but we're not going home by Christmas no one's going home by this is going to be a long War that's who actually did the best like they could take optimism and pessimism at the same time and put them together and be a rational Optimist another great example of this in business is Bill Gates who in the 1970s when he started Microsoft took the biggest op optimistic swing any entrepreneur has ever taken and by saying like there's going to be a computer on every desk in the world like the craziest bold Vision anyone's ever taken at the same time he managed Microsoft as conservatively as you possibly could in terms of like tons of cash on the balance sheet no debt he always said that he wanted enough cash in the bank so that Microsoft could make payroll for one year with no Revenue the most conservative way you can run a business at the same time he's taking this ridiculous swing for the fences and I think there are so many other businesses that are just as good if not better at creating products than Microsoft might be but they were managing the business with an equal level of optimism of like Leverage and debt and they eventually just get wiped out they run themselves over a cliff so Gates could take massive optimism and crazy pessimism and be like these things are going to coexist at the same time and that's an analogy for how a lot of people do well over time like the person like the pure Optimist runs over a cliff the pure pessimist never gets out of bed the person who knows when each needs to come into play is who actually does well over time what's that Talib thing about uh like I'm an authoritarian with my family I'm a socialist with my community I'm a communist with my Village say he says at the federal level I'm a Libertarian at the state level I'm a republican at the local level I'm a Democrat and at the family level I'm a socialist it's such a brilliant I think it's a great thing to say like as the size of something ch changes what you expect out of it and your relationship with it also changes it's also your nature must be able to adapt to the demands of the situation that you're in and the vertical that you're in okay so a business is not just a thing this amorphous thing it's not just Tesla doesn't just make cars and invent [ __ ] it also has to make money and like pay payroll and and be in compliance and it deals with lawsuits and it does all of these other things it's like do you really want Elon steaming into the lawsuit department for the person that's just being run over by an autonomous car probably not that's where you have different horses for different courses yes right and this is I suppose the difficulty comes when you as an individual agent try to amalgamate all of this into one brain you know in an organization you can specialize you can chunk things down you find the person that has the nature that you want we want to be conservative in the accounting department we want to be creative in the advertising Department tot fantastic like don't get those the other way or else you end up with boring ads insan and a huge problem with entrepreneurship is the assumption that because you can understand a technical product that you know how to run the business of a technical product it's pretty rare so someone like Mark Zuckerberg is very rare he had the technical chops to build Facebook build it himself and to run it today as a trillion dollar company that's very rare it's way more common for you to be an entrepreneur who knows how to build a product and then as soon as it scales you're like like I don't know what I'm doing here I need to call in the big boys who know what they're doing I mean a good example of that was Uber where Travis like no one could have built Uber other than Travis kalanick his ability to take a risk his willingness to just give the middle finger to The Regulators was like no one else was willing to do that and once Uber became a big company probably nobody was worse at running a a company than Travis C because that same attitude of like [ __ ] The Regulators we're just going to do our thing once Uber was a hundred billion dollar company that's not the guy you want Running Place the game so it's so but that's more common to have like a different like the person who is right to run it at this size is not the person who's right to run it at this size I told you the story of Ben Francis last night and I mentioned that Ben was founder found a CEO Ste back as CEO guy that used to run pumer or Reebok came in then Ben came in as like CBO or something like something to do with brand or like some sort of consultant steep back then came back in as CEO and he said this thing on the podcast that really stuck with me and he said when your Ambitions for the brand are bigger than your Ambitions for yourself that's when you'll become successful I like that that he was prepared to be like hey am I the best person for the job right now yes okay let's not to 10 mil let's do that do I have the first idea about how to run a 20 million pound business not really Inc comes the person from reok we're now at a $3 billion business well you know maybe it's actually there's different challenges and it's useful for me to be back and he was just completely prepared to put his own ego to one side and say what am I supposed to do so that shows a person who is right at multiple different stages but not right at all stages yeah I think there's a interesting alternative history in which Steve Steve Jobs does not die in 2011 and keeps running Apple what would Apple be today because the truth is after he left and T Tim Cook came in apple did great Apple did phenomenal in terms of like unit soul like net income Apple has absolutely thrived under Tim Cook and I think You' actually make the argument that around the time that Steve Jobs happened to die what Apple the company actually needed was a Tim Cook because and and and what they needed before that was Steve Jobs like in the early 2000s you needed a crazy maniac like Steve Jobs to come in and be like I got this crazy idea for new products that no one else is thinking of that's what Apple needed once they came up with those products what you needed was someone to come in and keep the trains moving on time like Tim Cook so there is a weird alternative history and I'm I'm totally making this up it's anyone's guess Steve Jobs doesn't die he keeps running apple and into the ground yes yes I I actually don't think that's likely but I think it's like a very real possibility that could have happened you could depends what metric you want do you want to continue to have this sort of pioneering spirit this person that's just doing like out there doing crazy things and it's exciting and all the rest of it yeah in the beginning yes my my hot take I've shared with some people and I say this tongue and cheek I'm not actually making this bet uh within 5 years Elon Musk will either be a trillionaire or bankrupt and there's like 5050 odds of either it's that's my hot take I don't actually take it that seriously but he's the kind of person who is like completely incapable of slowing down it's always just bigger bet bigger bet bigger bet bigger bet and eventually that might that usually catches up with people um but it's so fascinating to watch while he's doing it yeah yeah it really is uh one of my friends that lives here in Austin was working for a company that recruited the highest level seite Executives so they didn't Place Susanna was jiy uh or Tim Cook but they uh went through the process with both of them and what he was able to do he had access to their internal company internet and every archive and he was able to go in and see the biggest Executives in the world and see what their recruiters were saying after they'd had this sit down and I was like this is [ __ ] fascinating tell me what did you read he said well there's a difference between the a players and the AA players said the a players are in there and there's you know the usual stuff and there's often something that pops up that's maybe a little bit of a concern but they're they're good they're well-rounded he said but the AAA players are 10 times better and they stand out as that as well I think in um Tim cck's the first two words were absolute stud were the first two words of Tim Cook uh Susanna was a rockar was like one of the first few sentences and you think it's very interesting like these people they're more than just like again I don't know much about either of the guys but from the conversation I had they're more than just business people yeah there's something like ineffable in them where people who are exposed to the best talent the best paid most highly placed Talent on the planet for the biggest companies in the world look at them and go stud Rockstar yeah and I think like back to Apple like once Steve Jobs invented the amazing products the next step is okay can we literally make a billion iPhones and keep the quality as high as they need to be and that's what you needed a Tim Cook for and I don't know if Steve Job would have had that skill to keep that going but you could also Imagine a world which he doesn't die and as everyone knows the last 10 iterations of iPhones have been exactly the same and that would not have been the case under Steve Jobs they would have it would have kept innovating and created new things casualties of perfection there is a huge advantage to being a little imperfect I think it's always the case that people want to squeeze as much opportunity as they can out of everything in life uh whether it's in your career or whatever it might be and that invariably is going to eventually catch up to you like room for error in what you're doing is a massively important thing to have you saw this in 2021 where in manufacturing all over the world the biggest trend of over the last 20 years was efficient efficient efficient Just in Time Manufacturing and then 2021 rolls around and there's a little bit of like what is was honestly like a hiccup in the global uh in global T gets stuck in the [ __ ] thingy Canal everything collaps everything breaks there was no leeway whatsoever for anything to go wrong in the system and you can imagine a world in which those companies that were doing just in time manufacturing and then like collapsed in 2021 if they had actually held a little bit more inventory in their warehouses their Roi would have been a little bit lower in 2019 but they would have actually been able to supply products in 2021 and so it's always a case that like having a little bit of room for error having a little bit of leeway is great and it's true in your personal life too most people these days have what I call thought jobs their job is to work with their head it's not to dig a ditch or like pull lever their job is to make a decision with something and in that world what you really need more than anything else is time to think time to ponder time to like figure out a problem in your head and what does that look like it looks like sitting on the couch it looks like going for a walk it doesn't look like work but most bosses will not allow that most bosses even if you have a thought job is like I need you at your desk moving your fingers on the keyboard eight hours a day and so they don't have any time in their day for something that looks inefficient but is actually going to be like the thing that's actually critical to their job yeah Rory Sutherland has this idea about no one gets fired for hiring KPMG yeah is the safe bet following the blueprint doing the thing that signals bus to a lot of people look at my average response time on slack that's really good and it's like yeah but did we hire you as a slack reper yeah is that your job to be the slack response guy or is your job to be so George one of my good friends his first job uh at Social chain they literally created a role for him they called him Innovation lead I like like that's like vague what's that mean don't know not sure what they just make a make a roll for him put him in there he'll do something cool he used to go uh this was uh step bartler to company and they had all of these different big fan pages so they were able to design social media marketing campaigns but they were also able to deploy them because they had the pipeline they had a a two million person Harry Potter fan group or whatever it is and um George found that it was one of these open plan offices with [ __ ] as Turf everywhere and there's a slide in a ball pit you like one of classic sort of mid 2000s e type things and um George hated working in it didn't like the open plan office way too distracting he needs a little bit more order uh so he found that there was a room upstairs all of these different places filming content there was a room upstairs where they were trying to build the world's largest Harry Potter jigsaw puzzle but no one could be bothered doing it and it was like there was no time limit on the product uh the project to be completed and to be filmed so he would go upstairs and sit on the floor in this empty room that was 40 ft by 40 ft with no one in it no desk no nothing just a laptop on the floor and bits of Harry Potter jigsaw around him that he wasn't allowed to move because that would like wreck the continuity but he would go upstairs and sit surrounded by [ __ ] Harry Potter jigsaw puzzle pieces but that was his thing yeah his thing was I don't want to be the slack response guy that's not I want to actually make a decision that's my thing you're a big Walker I'm a big Walker virtually every I mean whenever write a book or an article that was written during a walk like I don't think very well if I'm sitting at my desk being like okay time to be creative time to work it doesn't doesn't happen you get good ideas in the shower you get good ideas going for a walk going for a run at the gym that's when things happen so people I think people intuitively understand that you need unstructured time in your day where you should just have like a 4-Hour Block in your calendar that says thinking time but but you you can't do that it's because everyone wants to like squeeze efficiency and opportunity out of their calendar yeah I had uh I release each year the same annual template that I've done to do my end of year review and uh I have to admit that this year even though I sent out the one that I've done for five years I actually changed it so I did a completely different process and I love the new one that I did so that will be available next year for the people that are listening and I asked myself a really interesting question I thought it was [ __ ] interesting which was uh what do I think is productive but isn't what do I do that I think is productive but isn't uh other stuff like what would I do if I wanted to make 85-year-old me miserable what are the things I would continue doing what would I do if wanted to make 85-year-old me what would 85-year-old me wish that I did more of what do I think is productive that isn't calls slack and WhatsApp yeah staying in on weekends sitting at my desk when I'm not working what is productive that I don't realize dinners with new people attending events travel reading that's so good like what you think is productive but isn't is like things that look like work and what is productive are things that don't look like work like most people would be like oh going out for dinner that's just pleasure that's just like last night last night two chapters probably from you for my new book and a couple of quotes from me for yours so Chris you and I had dinner last night for two or three hours and I think both of us got tons of idea for Content way more than I've done by sitting down on my desk trying to write something if I had and if I had skipped dinner and just sat in my hotel trying to work I would have come up with absolutely nothing yeah but it's so hard for people particularly if they are employed by a company to do that because if you tell your boss hey I need a budget to go out with to go out to dinner with my smart friends three times a week and I need to expense that and that's going to pay off go [ __ ] yourself you need to sit at your desk and type and every boss thinks that that's what's so hard and I think that's also why it's very difficult to innovate within a company like what looks like productive work uh is not what's act what's actually productive work I wonder whether this is good Hearts Laur again when a measure becomes an outcome it ceases to be a good measure if an organization that gets to a particular size starts to be broken down anything that can ever be seen on a dashboard is dangerous because it removes all of the things that can't be seen on a dashboard which for the most part are the things that are the highest outliers in terms of your return in any case yeah like we I was telling you this idea of hidden observable metrics last night and a lot of the creativity and the biggest outlier um returns that you're going to get are going to come from hidden metrics they're going to be driven by hidden metrics observable metric like yeah sure your um editor for your book probably needs to be observable metric guy like how many hours many changes did you make how many times did you look at this one sentence how much red ink did you use on this manuscript Jeff basos talked about this recently on on on a podcast where he's like a lot of metrics within businesses maybe they made sense at one point but then people just keep using them and you're using the same metric and people don't ask like does this metric actually lead to success or is this just what we're been TR and what we've been told to do and that's that's a lot of it too so like there might be some point in your career in which calls were productive there might like very early in your career like your job is to cold call like the number of calls you did but if you keep that for the rest of your career like you need to change the metrics in what you're following that's why I I think that it is a it's an error for people to not see the advantage of saying yes to someone that comes through town someone's coming through town they're in your town maybe they're only in your town for like 2 hours lay or but they're allowed to leave the airport maybe can grab a coffee with them [ __ ] go for the coffee with them like say yes to meeting new people dude I had I I stayed with Douglas Murray you know Douglas is uh British uh political commentator author journalist I stayed with him in New York uh January two years ago when I first moved out to America and I spent 3 days in Manhattan with him in his in his apartment that three day period uh didn't do much for my Lia because he likes to have cocktails but I I [ __ ] you not it came up with like six lifechanging insights that I still think about at least weekly I feel like I can get that from a single book or a single podcast too and it's a constant reminder to me that what does good look what does good work look like for me sitting on the couch in my sweatpants with a book that's the most productive thing that I can possibly do but even after doing this for 18 years I still feel like I'm not working when I do that it's it's really hard to actually switch your mindset into being to saying that's what I need to do I was telling you before that Rob Henderson's one of my favorite people he was Sting that seat not long ago as well and he his most popular substack article of last year given that he's done 5,000 word 10,000w breakdowns of advanced sociopsychological textbooks and all this sort of stuff was a thousand-word blog post called how I read and he's he got this one line in it which is reading is like going to the gym you must dedicate time to it and I think for me still now I think oh reading's like somewhere between a relaxation activity a Leisure activity and something I do when I have spare time yeah I don't think that about the gym I think the gym is the thing that I make myself go and do so a lot of people get frustrated at the fact that they don't read enough first off they should download my reading list which you can get at Chris will x.com books and psychology and money's in it second thing that they should do is actually commit some [ __ ] time to it you have to because your reading time and this is me shouting at me your reading time is always going to be the important thing that gets pushed to the side by the Urgent thing there's always going to be more slack messages there's always going to be another [ __ ] invoice to reply to there's always going to be emails or a call to take or something that you need to do or a [ __ ] dinner that you need to get ready for and you say no I can't I've I've got a gym session at that time can we do it an hour later no I can't I'm busy at that time like might be a bit odd to say like push dinner back CU I'm reading but like that the philosophy that you need to have going into it I'll tell you how this impacts me um my wife bless her she's wonderful if I'm sitting at my desk typing she's like oh Morgan's working I can't bother him I I I work from home I have a glass door in my office so she can see it if I'm on the couch reading she's like oh he's not working can you come help me fold the laundry this kind of thing like her her her bar for interrupting me if I'm reading is so much lower than if I'm typing and I don't blame her for that like what looks like you're working is not what what what is productive it's supposed to be hard everything worth pursuing comes with a little pain the trick is not minding that it hurts there's this great scene in Lawrence of Arabia where a guy uh pulls out a a match lights it up and puts it out with his fingers doesn't even wi this other guy watching him he's like oh let me try that pulls out the match lights it up puts his fingers on and goes ah it hurts what's the trick and Lawrence goes the trick is not minding that it hurts and it's like that is such such a brilliant scene and that applies to almost everything like there is a cost to pay for almost anything and a trick in almost any Endeavor in life is figuring out what the cost is and just being willing to pay it it's true in investing of putting up with volatility it's true in your career where there's a Jeff basos quote where he says like look if you can get to the point in your career where you enjoy half of it where half of it is fun that's like as good as it gets like there's things in any job that just suck it's like dumb boring admin work and if you can get to where half of it is fun that's great you and I were talking about this last night in both of our careers a lot of it is fun and very fulfilling a lot of it is kind of just Mani just work uh it's just capital W work so I think in almost anything figuring out the cost of it is is the most vital part of of being successful over time you see this a lot in people's careers you and I were talking about this last night take someone who was Uber successful uh musk Gates Zuckerberg those kind of people if you actually drill into what it took for them to achieve that success Michael Jordan copi LeBron all those kind of people the cost that they paid to get that success in their personal life often for their health for their mental well-being is off the charts but it's so common for us to look at them and be like I want that life I could have that looks like an amazing life but when you actually factor in the cost of what it took you're like I don't know I I don't know it's the thing that I've been the most obsessed by I would say from a uh other people's psychology perspective over the last two years uh Tiger Woods perfect example of this uh I had an entire bit in my live show about this James Joyce you know masterful author but posthumously a long series of fart fetish love letters that he W wrote to his wife were released on the internet like uh Salvador darly you know much about darly complete Maniac his parents gave birth to a child 10 months before him that they called Salvador and then almost immediately got pregnant again that one died they were adamant that Dary was The Reincarnation of his dead older brother that's how you entered the world uh when he was a child Dar pressure throw himself down the stairs he found out that he was a masochist very early in life he would throw himself down the stairs for fun when he was giving a lecture he was suffocating inside of a deep sea diving suit that he had to be wrenched out of midt while he was giving a lecture he married a woman who was married at the time they were both married they both separated from their current partners has got together and then darly immediately started to treat her as halfway between a God and royalty so he bought her a castle and then would send formal letters of request asking to visit her in the castle that he bought her uh and he would refer to her as his Muse and all the rest of it but all of those things contributed to that's how you end up painting like melting clocks and then stuff like that yeah as brilliant as he was Da Vinci didn't do Dary and Michelangelo didn't do Dary the only way we get is by darly being the throw myself down the stairs lock myself inside of the deep sea diving suit buying my future wife a castle person that's the only way there's a a quote from Alex that I spoke to him about the start of last year it's one of my favorite ones whenever I get to a low point where I think why do I even bother I just try to remind myself this is where most people stop and this is why they don't win I reminder for the Gladiators in the arena who feel beat up and scarred with no hope in sight building a business is hard hard feels shitty this is what hard feels like and this is why most people can't do it but you can this is what hard feels like was in my memo that I sent to the team this year it's something he told me this great story about when uh pledges he was in a fraternity at college and he was like high up or whatever uh the pledges were whining about what they were being made to do and he said right I know everyone's having a pity party here so he calls them around and he says look who here thought that this was going to be easy no one puts their hands up he's like who here thought that this was going to be hard like everyone puts their hands up and he goes this is what hard feels like no I think in most Endeavors in life people perfectly understand the relationship between price and quality you want a nicer car it costs more bigger house it cost more but that like understanding goes out the window when you're talking about Career Success or career fulfillment or personal health things like that like that the the relationship just kind of breaks down in their own mind but it it doesn't go away like the higher the success the higher the cost I love reading biographies of entrepreneurs of generals whoever it might be with very few exceptions do I finish the biography and think to myself I want that person's life what I think is I'm glad they existed I'm so glad the world had that person that we can all benefit from but though the crazy success comes with a cost that very few people including most of the time myself are not willing to pay how can people not mind that it hurts more I think when you talk about someone like it's like it's ingra it's ingrained in them I think some I think whenever you have somebody like musk Zuckerberg Jordan Tiger Woods there was not a decision that they made they had to they had to pursue it's a compulsion um several years ago I heard Patrick oanes say that the single word that he would describe for most successful people was not driven it's not motivated it's tortured that they wake up every morning just like I I am tortured at the success that I have not achieved yet and I have to I have to go do this I have to go work 24 hours so some people I think are born with it and some people are not which is why like the success is so stratified um once in a while I think you have someone who is like a middling success and became a Founder at age 50 and knocked it out of the park but that's extremely rare I think it's usually people who for whom this is just in their blood they have to do it yeah again from Alex last year he said Champions are broken people look at Champions and try to find something that they have that everyone else doesn't have but it's the wrong way round Champions don't have something that everybody else does have a sense of a sense of being fulfilled correct and saying like that's enough what was the Donna party the Donna party was amazing and see for you you you as as a Brit probably never heard of the Donner Party is that right no so back in in the 1800s there was a pretty well wealthy family the Donner Clan they were in Chicago who were moving West as a lot of people were and the Don like they were very very wealthy but they were like driven to the the wealth and the opportunity and the prosperity of California which is the new land during this period so they start making it out west and this is of course before railroads are making out on on Wagon Train and they start off there's a very big party it's more than 150 of them that start off and at one point they meet I think they're in the middle of Nevada and they meet this quack who promises them a shortcut who says like hey like the route between here and to pass through the Sierra NADA mountains is pretty tough but I know a shortcut you can make your way around here the shortcut turned out ended up being completely bogus and it was it was nonsense they Bally had to basically backtrack back to where they originally started from that delay made it so now they were going to cross the Sierra Nevada mountains in the middle of the winter which is not when you want to be doing it you want to cross it in the summer or the fall before the snow comes they eventually hit the Sierra deada mountains during what was the biggest winter in decades the biggest snow dump they got completely stuck and they had to resort to eating each other cannibalism and it's a it's absolutely horrific Story I mean one of the details that sticks out from there that just shows like the plight that they were in when they were eating each other and there were still dozens of them alive at this point they would label the meat that was harvested to make sure that you did not have to eat your sister or your mother that you were eating somebody else's I mean the plate that they went through was extraordinary and two things have always like stuck out for me from the da party most people just focus on that element of the story one of the things that stucks out is sticks out is that they were they were already rich they were not going to California because they're like were broke and we want new they were they were just like seeking more they were already crushing it the other was they were in this situation specifically because they were a like tempted by a shortcut and look I'm all for efficiency I'm all for doing things the right way but so many shortcuts are just cutting Corners that's eventually going to backfire around you and they were like such a profound example of that the safest way to get what you want is to try to deserve what you want that was from manga what's that mean he he he he mentioned this in several different context the biggest that he mentioned in was love if you want to be loved the way that you get that is to deserve to be loved uh there's another quote from my friend Brent bore when he's like he says something along the lines of marriage works when both you and your spouse devote your life to serving the other person and expect nothing in return so you wake up and you're like I'm here to serve my wife and I don't expect her to serve me back if both of you do that at the same time you're both serving each other without expecting anything else in return It's Magic think about what the opposite of that is Neil Strauss said this the other week un unspoken expectations are premeditated resentments unspoken expectations premeditated exactly I think that's Brent's exact point said more succinctly yeah that's that's really what it is so I think you know now and I think it's the true for a lot of things if you want to be wealthy like you need to deserve it if you want to be a successful entrepreneur you need to deserve it no shortcuts it's all just like find the price and pay it keep running most competitive advantages eventually die I think there's so many examples of this one of the most interesting is Sears uh which if you go back to the 70s and 80s no other company in America had the moat that Sears did it was completely Unstoppable SE for the Brits oh are you kidding me come on Sears was kind of the uh it was it was the most successful retailer mostly clothes and things like that department store but they also sold um you know washing machines that kind of thing they're actually still around a Walmart type thing yes but less big than you know less uh less all-encompassing than Walmart but they were everywhere they were so dominant back in the day nobody could touch them and they got so big that they started by they bought Discover card and like Dean Witter stock they started like moving into all these other areas no other it was truly the Walmart of its day or even like the apple of its day I was just like nobody compete with this and then they lost everything and went bankrupt and then lost it and if you dig back into what happened of like they became successful because they were so Scrappy and so terrified of of competitors that's why they became successful as soon as they got big it all went to their head and they were like we're Sears nobody compete with us they stopped innovating they ignored this upcomer that was chasing them called Walmart completely ignored it and by the time that they realized what had happened it was way too late they were gone and I think that's actually a very common story that it happens in individuals lives as well where the reason that you are working so hard is so that eventually one day you will achieve a of success in which you don't have to work so hard anymore that's what's motivating you is the dream that you can one day relax so when you become successful you justifiably think I can stop working so hard I don't need to grind as hard anymore and then the moment you think that and it's Justified you think it's Justified you you lose what actually made you successful to begin with and then it's that's the downfall and you see like there's this amazing interview many years ago with Mike meritz who was the head of of seoa the most successful Venture Capital firm that's ever existed and Charlie Rose asked him they said why has seoa been so successful for 40 years not over one market cycle you've dominated for 40 years and Mike Merit said we've always been scared of going out of business and like look if there's anyone in Silicon Valley who has the right to say it's because we're smart it's because we're so good at what we do he has the right to say that but he didn't say that he said we're terrified of going out of business that's like that like like you never let your guard down what made you successful you never let go of that isn't re Business book only the paranoid survive that's it exactly and uh you know there's I think there's lots of different versions of this I read recently that The Unofficial motto of Nvidia their unofficial corporate motto is we are always 30 days from going out of business that's what they tell themselves in their meetings we're always 30 days hanging over that yes but I think that's why they're that's at least one of the reasons why they're so successful what me and you were talking about this last night and think it's a brilliant frame and I want to spend more time building it out uh serotonin Morgan versus dopamine Morgan and I think that the only the paranoid survive business model is uh dopamine company not serotonin company yeah right that is very Vigilant very anxious very on edge making sure that everything scrutin heavily scrutinizing all of the different options and keeping a breast of of competitors and and you know having these sort of underlying resentments but also knowing that I can't really bring them up because that's also not going to be good but I'm going to [ __ ] hate them in any case yeah it's that energy it's that lean in it's that tentative sort of very watchful energy and I think that especially if you are somebody that's close not only close to the operating of a business but also emotionally invested in the operating of a business or if your professional life and your personal life have Blended in a way it can be very difficult to not have what is effective professionally curse you personally yeah right it is very very good for you to be on edge in that manner very good it is useful and effective as a business to be on edge in that manner yeah it is catastrophic and destructive for you to be on edge in that same way in your private life and what's so hard is that most people when they make a mistake don't know it they're blind to it whereas cutting back because You' become successful is a cognizant decision you know that you're like I because I've become successful I can now sleep in I can work fewer hours you know you're doing it you think it's Justified but what you are blind to is like what that's actually going to do to your career and someone tweeted this just last week they said when does a startup lose its magic and the precise moment when it happens for every one of these companies is when the CEO stops building the product when the CTO stops coding when the chief marketing officer is not writing the the the copy anymore it's like once you become so big that the senior executives are detached from actually doing the work when the musician stops writing their own songs I know authors who when they become big uh they have so much pressure and incentive to write more books that they basically hire ghost writers or at Le people to the and that's when you lose the magic you're not doing it yourself anymore the same thing is so true in the world of podcasting and specifically YouTube YouTube more than podcasting uh the creators that take their eye off the ball with guest booking guest research scheduling titles thumbnails and branding what actually matters the longest points of Leverage like if I I spend 6 hours every single week on calls just doing copyrighting for seven videos that's it yeah so it's an hour of video we spend an hour of video to come up with the right title and the right thumbnail because it's one of the longest levers that we have yeah every single video that's ever gone out I've touched every and I'm like getting to the stage now I was telling you this last night I'm I want to operationalize things I'm tired like I don't get to just do the things that I used to do but I also realized and this is uh Lea hosi Alex's wife um I asked her what are the things that you should Outsource and what are the things that you shouldn't one of the first things that she said you shouldn't Outsource the thing that makes the money or the impact yeah yes yes that's good Outsource everything else [ __ ] get a maid get a cleaner get a gardener get a [ __ ] driver get a whatever you need but don't Outsource the thing that you're there to do yeah I think you see this a lot in um in investing where you have someone who's a very talented investor very good at picking stocks finding the right business and then they launch a fund what does launching a fund entail half your time is going to be fundraising half your time is going to be accounting HR you got to hire people and then you're completely detached from what actually made you good to begin with and that is so common in any business I I think it's I think it's I think if you like identifying that point if you can effectively Outsource those kind of things I think if you are the entrepreneur the CEO whoever it is and you get to a point where you're like hey I've become really successful and I I became this successful because I wanted to step back you need to be honest with yourself and DET and remove yourself from the situation the people who fall into problems are like I grinded for 20 years now I'm successful but I'm not going to leave this business that I built I'm going to stay here and just become fat happy and lazy y that's when it eventually just crumbles yeah the wonders of the future it always feels like we're falling behind and it's always easy to discount the potential of new technology it's so like very rare is there a single new invention that is amazing in and of itself it's usually that you have a small invention and then 10 years later another small invention 20 years later another small invention and those things come together and that's what creates something amazing Jeff basos has talked about this recently where he was like when he launched Amazon in the 199s he did not need to build a payment system it already existed it was called Visa Mastercard he didn't need to create a shipping system it already existed it was ups but like he took all of those things and combined them and built on top of them and it's true for a lot of Innovations of like I mean the the most like stunning example is Thomas Edison did not invent the light bulb it was first invented by a guy Nam uh named Humphrey Davies who was a Brit who created something that looked exactly like the light bulb I think 20 years before Thomas Edison the difference was the light bulb that he built it was impossibly bright would go blind by looking at it and and it would only stay perform what can I say and it would only stay lit for like 5 Seconds what Edison did is he moderated the intensity and he lengthened the endurance of the light bulb that was in incredible but let's not pretend that he built that flaming bulb from scratch he didn't he took what other people had done and built on top of it and it's true for almost any invention of like obviously uh obviously Henry and Ford did not invent the engine he didn't invent the wheel he just like combined all of these things so whenever a new invention comes out I think it's very easy to be like what is this useful for and a lot of times the answer is like we don't know but someone like this is going to be something that somebody combines with other things in the future that's going to become something incredible you've got a typical path of how people respond to what eventually becomes world changing new technology first I've never heard of it then I've heard of it but I don't understand it I understand it but I don't see how it's useful I see how it could be fun for rich people but not me I use it but it's just a toy it's becoming more useful to me I use it all the time I could not imagine life without it seriously people lived without it it's too powerful and needs to be regulated and it's true for almost every like big invention the two that are most interesting to me was the invention of the car and the airplane which when both of those came out in the early 1900s the first reaction to those was like I don't understand why anyone would want this the first car was so inferior to the horse and the first plane was so inferior to the train so everyone looked at it and they're like what the hell is the use and then it was like oh I see it's a rich person's toy if you're if you're a zillionaire you're going to have a car that you can putter around town with I kind of get it and then it becomes better and better both the car and the plane the first uses that people saw for it was like oh we could strap a machine gun to this and use it in the Army virtually nobody saw even the people who worked in those Industries what it would become which was like good for transporting people and like nobody saw with the car they're like oh this is going to open up a new form of living called the suburbs and people can drive to the city now nobody saw those things coming it was a very long path it usually takes 10 to 20 years at least before people are like oh now I get it you saw this too there's so many classic examples of in the 1990s of Articles Written In Time Magazine about like the internet why would anyone want to use the internet how could anyone possibly like lug around the thing called a laptop nobody's ever going to do that and it's easy to poke fun at those and you should poke fun at them but it's actually common for virtually every new technology that you cannot fathom what it's going to eventually become how should we interpret this consistent Trend should we be less quick to cynicism and skepticism around things it's also very common historically that people say we haven't had a big invention in 30 years we used to innovate but over the last 30 years what can you think of that we've actually created that's a very common view and usually what's happening is that it's not that we haven't invented in 30 years it's that it takes 30 years for us to recognize any invention so we look back today and we're like yes the internet was big but the internet came about 30 years ago but if you go back to the 1990s it was like no we really haven't invented much in a long time like it's always that lag in how long it takes you to understand how big something is going to become and you can imagine that happening in 30 years from now that in 30 years from now we're like oh we haven't invented anything in a long time but in 2024 we came up with the whatever it would be uh that that is such an obvious new technology cuz when we were inventing the car in the airplane or the transistor the radio or the internet very few people knew at the time what it was going to become it takes decades for you to understand what it's actually going to be harder than it looks and not as fun as it seems The Grass Is Always Greener on the side that's fertilized with [ __ ] which is a wonderful quote I can never find who originally said it I can't take credit for it but it's such a great quote I think there's a truth and life that everything is sales everything is sales and it's done in an innocent way but a big part of this is that people tend to exaggerate and advertise what they're good at and hide the hard Parts hide the flaws and it creates this in this view among virtually everybody that your success was much easier than it was this business is better run than I think it is I was talking to a friend a couple years ago who was like oh this rival company is so better run than the company I work for they're so much more efficient so much or more organized and I'm like how do how do you know that and and basically what it is is like from The Outsiders perspective everything looks like it's easier and and better run than it actually is but if you have The Insider perspective of how the sausage is made you realize like how inefficient virtually everything is and so that's I think that's that's a big part of life is just like realizing that success is harder than it looks we we we talked about this earlier with t Woods Kobe Bryant Michael Jordan all these people like if you actually dig into what their life is it's infinitely harder than it looks did Elon on Lex where he said my mind is a storm most people would want think that they want to be me but they don't they don't know they don't understand because what people look at Elon and they're like oh richest man in the world he's got a golf stream he's got big homes I don't even think he actually does but like he he has he's worth a quarter of a trillion dollars he can do anything he wants that seems like an amazing life like no I think if you actually dug into it I think Elon is in like probably the bottom making this up 20% of like mental health in society tortured you know I had this uh idea called the cookie test that I did on stage during my live show and it's kind of about this but from the way that we perceive other people so imagine that there's a cookie here and I decide that I'm going to make the decision about whether or not to eat it when I do that this Unholy War begins inside of my mind between you know there's platoon and one of them got a dragon and there's a trebuchet and there's the my old PT teacher Mr Henderson from 9ine saying you're a cookie eater and you've always been a cookie eater and you're always going to be a cookie eater and then after a little while the better version of me succeeds and I turn away that's what I saw internally what you saw was some bloke stare at a cookie for a while and then turn away hungry and sad yeah from the outside everybody else look like slick rational agents and from the inside we look like wavering idiots yeah because the asymmetry in what we observe of our own uncertainty and what we perceive of someone else's uncertainty is so asymmetric I also had this idea about how people going through breakups or people that feel like they've been uh hard done by or maybe they're wisting after um a friend or a partner that they used to have and we able to romanticize especially people that have scorned us or that have left us there's something sort of uh particularly alluring in their aloofness right yeah um but I think it's something that we can all take you can use this asymmetry to your advantage as well think about how much more deep and dextrous and nuanced and subtle and finessed your thoughts are than even the person you know the best on the planet your twin brother's thoughts are that you know of right it's a one 10,000th one one one millionth right of what you have observed of yourself so if you are someone that's struggling with the wistfulness and I'm never going to be able to find anybody like them there is also a very easy argument of they're never going to be able to find anybody like me yeah because you only see this very rough hee version of them whereas the depth that you get of yourself is so much greater there's also almost the opposite of this which is Daniel Conan's observation that it's much easier to spot other people's flaws than your own even though you're very aware of what's going on in your head in your thought process and whatnot it's it's very easy for me to look at your decisions and say like oh you're you're you're missing this and you're incomplete on this you're making a bad decision here but you can justify your own very very easily because you know the internal dialogue in your head that's justifying your decisions I'm doing this because of this reason and what not here's why I'm doing it but for when I'm watching you I only see the actions that you're taking and I can just judge you much more objectively in that measure but I think if you could see the thoughts going on inside of everyone else his head you would see that the world is a thousand times crazier than you think it is you'd see people are a thousand times more depressed than you think they are they're a thousand times more creative than you think they are they're a thousand times more evil than you think they are because what they're actually putting forth and speaking and the actions that they're taking is such a tiny percentage of what's actually going on in their head we had movies a long time before neur link or Elon Musk were really even even sort of uh objects in the pop culture but like Minority Report you know the ab to be able to see what someone is thinking or be able might be prepared to do in future to be able to predict that and then go after them was it Minority Report no it wasn't what was the thing with Tom Cruz where they could see into the future and he had that big screen there people screaming into their iPods at the moment I don't know but it sounds good it's great anyway good movie my Minority Report was the one with uh uh [ __ ] Matt Damon right Moran why do you spend more time watching movies books I'm reading books man stop it stop it um anyway uh that's going to kill me that I can't remember anyway that movie The ability or what we have at the moment people are only culpable for the actions they take and the things that they say not the thoughts that they have there's no such thing as thought crime at the moment and you can say we live in a world that senses and all the rest it's like yeah but if you keep your thoughts literally as [ __ ] thoughts no one knows so imagine if you got thought canel but that's my point my point being everybody would be cancel yeah that's where where the toxic compassion thing that I was telling you about last night comes from which I believe is performative empathy is a front it's a very shiny veneer that nasty people put over the front of their meanness to appear nice yeah it's like a small gold bar that's being beaten so thin that it's in gold foil and it gives the illusion of something that's glittery but if you poke it a little bit it's just a hole through the other side yeah that's a great analogy I like it incentives the most powerful force in the world when the incentives are crazy the behavior is crazy people can be led to justify and defend nearly anything I think people underestimate the extent to which the boundaries of their morality the boundaries of the actions that they're willing to take can be changed so easily if their incentives change mean I saw this during the financial crisis of 2008 when people after the crisis in in a somewhat justifiable way would say those greedy Wall Street bankers who crashed the economy I'm not saying that wasn't completely Justified but what almost every one of those critics didn't understand is that if they were a 25-year-old mortgage broker at Goldman Sachs at Leman brothers and your boss said if you package these subprime bonds we'll pay you $4 million this year you would do the same thing you would have done the exact same na concentration camp guard but in Reverse yes yes and I think there's so many stunning examples of this of when the social incentives the tribal incentives to do something that is objectively bad but you can easily rationalize it by being like well this is the incentive for me to do the right thing there's this documentary about about El Chapo uh in in in Mexico the uh drug lord who was a pretty vicious terrible guy um and they're going to this rural town in Mexico and they love El Chapo all the people are just like Chapo Chapo Chapo he's so great and they talk to him and they're like well yeah like we live in absolute utter abject poverty and Chapel would come in and build a schools build us roads give us food pay for our children's wedding we love the guy absolutely love the guy so when the incentives are there to overlook some element of someone's Behavior their personality people just suck it up right away another stunning example of this there's a book uh called what we know no sorry what we knew and it interviews German civilians after World War II and these are German civilians who experienced who are in Nazi Germany in the 1940s and the the book is just interviewing these people saying what did you know what did you see what did you know about the Holocaust what do you see about what was going on and they're interviewing this uh German civilian woman and she says oh you know when Hitler came to power in the 1930s everybody embraced him and the interviewer is like why like how could you Embrace this monster and she says well you have to understand in the 1920s I'm paraphrasing her the German economy fell apart they had hyperinflation nobody had anything Hitler came along and said I have a better way we're going to give you jobs we're going to give you prosperity and the woman says in in that situation you do not say to that person no I don't want that in that situation where you are in a desperate situation and someone come along and offer what looks like help you take it and that's I think was I think that was a very honest description of what happen in the situation that when the social incentives are to embrace something that is otherwise wicked and evil and terrible like millions of people can embrace it if their incentives for one aspect of their life are are to embrace it what about Heaven's Gate Heaven's Gate I think so Heaven's Gate was the cult they eventually all killed themselves they all committed suicide but there's this amazing part of the heavens Gate cult where at what point at one point in their um in their cultish behavior they believe that there was a spaceship that was going to come save them come down they could all board the spaceship everyone else on Earth was going to die but they would be saved they're waiting for the spaceship to come and they go to a store and buy a telescope so they can see the spaceship coming in they go out point up to the night sky looking for the spaceship don't see anything no spaceship they bring the telescope back to the store where they bought it and they said this telescope is clearly broken it doesn't work and the store owner says like what what what happens to us looks like it works to me and the Heaven's Gate guy says it doesn't work because it doesn't show the spaceship so it clearly doesn't work the spaceship is obviously coming but I can't see it so the telescope is obviously broken like when you firmly believe whatever kind of [ __ ] that you're going to believe any evidence that's going to come that to show you that you're wrong can easily just be purely dismissed and that's a like a humorous I mean it's kind of a sad extreme example but virtually Everyone Falls forward this in some way we like if you believe X then evidence that X is not true can easily just be pushed away in a second you see this a lot in the economy we're like if you are a pessimist and you're like there's going to be a recession we're in a recession and then GDP data comes out and you're like oh it's actually pretty strong by the way that happened this morning so many the pessimists will be like well you got to dig into the numbers and see like again you can easily spend anything you want in order to justify the decision that you've already made pessimists get to be right and optimists get to be rich I think that's that's by and large right there's also a thing where a lot of economic pessimists pundits they can be wrong forever and they're never penalized for being wrong because they are giving somebody a product that they really want and a lot of what it is is I think at its core I think there are a lot of people in the economy who are feel inadequate about their own position in the economy and they literally fantasize about other people suffering economically a transfer of wealth from the people who you have to the people they literally fantasize about a stock market crash because of other people got poor they would feel better about their own situation and I think that is why economic pessimism in the punditry space is so like when it comes out people are like yes that's what I want like tell me the economy is going hell makes them feel better about their own situation now you get it nothing is more persuasive than what you've experienced firsthand I read the saying this is a pretty common that in military boot camps this was during World War II but I think it applies to to to any era there would be so many soldiers who after boot camp would be filled with bravado and they'd be like I'm going to go get those Nazis like when I get out there I'm going to come guns blazing like watch out here we come and then the moment they are put on the front lines and a bullet whizzes over their head they are terrified out of their minds there have been some studies that showed and they're very controversial about whether this is actually true that only a small fraction of the soldiers on the front line ever fired that gun pulled their trigger so many of them and who's to say it would not be me or you either I can't remember what it's called there's a a particular type of firing that it's like non-mortal firing or something like that so they would do it but they'd fire just in the air in the air because they couldn't and over the top I do not this is not a criticism in the slightest that even when you're facing a Nazi Soldier Japanese soldier whatever would be to stick your gun at him and pull the trigger you just say I don't have it in me I can't do that I that's not I think there's a very good chance that I maybe you would fall in that situation too so this is one of the interesting I guess incentives going back to one of the lessons we learned about earlier on of War yes it would be hard especially if you hadn't gone through the training but then you go through the training which is basically trying to remove the type two thinking and just put you in type one like you see enemy bang you see enemy bang like it's it's not person it's response right they're trying to drag it out of that deliberate thinking and into that responsive thinking but kind of like the ever escalating ladder of nuclear weapons that you were talking about before if my friend that I've been through boot camp with just gets shot and is either dead or injured that's going to be pretty motivating for me to think first off I'm in that kind of a danger and it's either them on me and secondly [ __ ] you you just shot my friend yeah so you get this almost I I would guess if you could track this if you could study this appropriately I bet that you will find the uh lethality and rate of firing of soldiers on the front lines will probably follow a U-shaped curve yeah they will not be some then people will begin to die threat will begin to increase people will begin to fire more and more and more and more and more and more and then it will tail off on the other side and at some point and this is a Nuance that maybe doesn't even matter but you're not firing to kill the enemy you're firing to save yourself it's just like you're in a situation where it's like it's either you or me and I'm not and this is not about like the strategy of what we're doing this is just a pure survival mechanism right now but I think I think the the broader point is like you do not know how you're going to respond to a situation until you've experienced firsthand and the military is an extreme example but this is true for like bare markets in the stock market so common for people to say if the stock market fell 50% I would view that as an opportunity I would back up the truck and buy more and then it actually happens and they're like oh this sucks I'm terrified I don't want anything to do with this it's like way easier to quote war and Buffet than it is to actually take those actions in the to the moment a lot of this is because if I were to say how would you feel if the stock market fell 50% by and large you imagine a world in which everything is the same as it is today except stocks are 50% cheaper yeah and in that world you're like oh it's great it's an opportunity but the reason the market might fall 50% is because it's a pandemic there's a pandemic there's a terrorist attack and in that situation you're like how would you feel if the market fell 50% because it's the day after September 11th and everyone on TV says there more s coming that are going to impact you in that situation you might be like that's not such an opportunity anymore that's always what happens time Horizons saying I'm in it for the long run is a bit like standing at the base of Mount Everest pointing to the top and saying that's where I'm heading well that's nice now comes the test you see this so often of like particularly in investing but this happens in a lot of areas in life where people are like I'm a longterm I'm in it for the longterm I'm a long-term investor you're like great that's a good mindset but the long-term is just a collection of short-terms and you need to experience all like all of those short-terms so a long-term investor does not get to ignore the short-term volatility the short-term recessions the short-term bare markets you have to experience and endure all of those so I think in investing very often saying that you are longterm is a cop out to saying I I don't need to to to like manage my behavior and my expectations over the next 12 24 36 months when you do a lot of this too is like maybe you the investor the fund manager is a long-term investor but are your clients is your spouse are they going to put up with having a shitty year maybe you're willing to do it but is your business partner willing to do it like saying your long-term is very different than actually being a long-term person how can people make the long run easier if there's so many you are Mr compounding right if there are so many gains to be acred by playing long-term games with long-term people and long-term Investments and piecing into the S&P and not being that fussed about what happens and looking at signal not noise and all the rest of it how can people improve their long-termism one of the things like one of the ways I've subtly changed how I think about investing over the last couple years is the a bigger realization of how much of successful investing is nature nurture leaning towards the nature side I think some people are just wired to get it and some people are not Charlie Monger made this point where he says when young people learn about investing they either understand it instantly or never at all and it's one of those two I think that's a little too black and white but I think he's directionally correct that some people just get it you and I were talking last night about like what is the genetic soup that you're born with you have no control over it but yours is different than mine it's different from everybody's and so I think some people are much more able to think longterm than others I'll tell you a little story my brother-in-law is a social worker works with very impoverished families homeless families children who are in terrible situations and he was talking to this family one at one point um a very impoverished family and he said something along the lines of saving your money for the next week for the next month and they laughed at him and they said oh you're a future thinker and he's like what and he said you're a future thinker they said you got to understand when you're in our situation you do not have a Time Horizon that exists Beyond 24 hours there's no such thing as next week we don't know where we're going to get dinner tonight we're not there's no next week we're just like our field of vision is 24 hours and I think that's an extreme example but there's a lot of people like that of like when if you say like you should invest for the next 30 years they literally cannot Envision what next month is going to look like so why like next 30 Years is completely and utterly theoretical for them who was that actress was it like Margo Robbie or someone that said we're going to be married forever I can see us being together for at least 10 years and then got they get divorced next month that was Elizabeth Taylor of her one of like a dozen divorces that she got where she says like yeah there's no world in which we're ever going to get divorced and she gets divorced 30 30 days later um so I think I think it's yeah it's you know people there's a thing in Psychology called the end of History illusion where people are very aware of how much they've changed in the past but they completely Mis underestimate how much they're going to change in their future so if you compare Chris today to 18-year-old Chris you're like H completely different but if I said who is Chris going to be at age 60 most of the time you're going to be like oh probably very similar to who you are today and that's not true it's never true for anyone Chris at age 60 is going to be maybe as different as the difference between you and 18-year-old Chris but it's very hard to come to terms with that most people think they're going to be the same person for the rest of their life even if they know how much they've changed in the past so it's easy to say I'm going to be married to this person forever I'm going to be a long-term investor forever but things change like what you want out of life changes your wisdom changes your incentives change to push you to do something different the converse is true when it comes to personal growth as well that if you ask yourself what would you tell you from 10 years ago you could go back in time and write them a tweet or send them a text or whatever what are the things that you would tell them to start doing and stop doing and focus on and let go of a lot of the time people use that as a it's a subtle brag it's a humble brag about these are the things that used to be a malady for me but now I've transcended yeah I would wager that at least 70% of the things that you in 10 years from now would tell you today are things that you today would you tell would be things that you would tell you 10 years ago it's more just like a wish or a fantasy of like I wish I wish I knew this 10 years ago but frankly like do I actually even know it today I I I wish I could accept this truth today frankly I still have a problem with it you are your patterns and they continue to repeat yeah and you you are the common denominator between all of the different situations that you end up in is it that every single girl is a bitter spiteful [ __ ] that always wants to try and ruin your reputation all the rest of well what do all of those girls have in common with each other the only thing that they have in common with each other they knew you is you you're the only coming to Dominator pieces together yeah either that you chose them or you created them or you molded them or you did something but it's [ __ ] you your another Corr where it says something like if you meet one [ __ ] you've met one [ __ ] if you meet an [ __ ] every day you're the [ __ ] you're the [ __ ] everyone you meet is a jerk like this should be telling you something yes trying too hard there are no points awarded for difficulty I think it's it's true like in almost any Endeavor there's going to be a very small handful of variables that drive the majority of your returns it's true in business careers investing relationships and I mean it's definitely true in investing particular that in in in many Endeavors in life if you want to get better at at golf you should you should practice a lot if you want to get better at basketball you should practice a lot if you want to get better at investing you should do less you should not you should not practice more you should not try harder you should not pull more levels or levers or turn more knobs you should do left there are no points awarded for difficulty and it is so counterintuitive in investing that the smartest people who went to the best schools who have the best education are are the ones who try the hardest and very often earn the lowest returns uh there was this thing um that I read recently that as recently as hundred years ago the people who in society who had the worst medical care were the richest people the richu they were [ __ ] with it too much because they they could afford all the miracle cures sold by quack doctors that were actually just going to poison you and I think there is a perfect coraly with financial advice that some of the people who get the worst Financial advice are the richest people who can afford the highest pric consultants and advisers that tell them to justify their fee to turn the knobs and pull the levers and Fiddle with the system as much as you can to earn higher returns those are the people who 95% of them or more are going to underperform the simple basic Index Fund one of my favorite Rory suland stories was uh Terminal 5 London Heath row you'll have been through it if you've ever a flown International connecting through London you go in and you go up this escalator set of stairs after that there's like one bloke checking everybody's tickets it's insane and then you go upstairs and you're at the top gang level of Terminal 5 and you're in a snake queue and you need to get rechecked to go through security and they were getting complaints there were too many complaints the amount of time that people were waiting they were missing flights and and and they just couldn't deal with it so as alwayss they the humans of this situation looked at it like an engineering problem an optimization problem let's get retrain the staff to be quicker can we fit more Lanes in can we change the machines so that the machines move more quickly can we do all the rest of this stuff and either Rory or one of Rory's friends stepped in and said before you drop 50 mil on this you know two football pitch sized area of security machines just let's see if we can find a a behavioral solution to this and sure enough they did and they just put signs along the queue that said 15 minutes from this point 30 minutes from this point 45 from this point and all of the signs were 5 minutes longer than the wait time make it easier for people to adjust their expectations and they just got there and they were like I mean it's 40 minutes but you see it was supposed to be 45 this was the biggest thing with Amazon does this well I know this because I've been so uh in the mix with it with with Book Sales a lot of times on Amazon they will intentionally quote you a ship date that is way longer than they know they can get it to you because they're always just managing your expectations and then when you get it earlier you're stoked and almost never it will happens the once in a while but very rarely will Amazon quote you a ship date and then it comes later than that because they know even if it's one day late you're livid if it's two days early they a customer for Life what are the areas in which trying harder or touching it more like with with investing touch it less is kind of the the rule yeah don't don't stop [ __ ] with it right you're an 1850s person at the doctor just stop [ __ ] him with it I think I think if the Endeavor is technical then you need to mess with it more Tiger Woods can hit a ball better than you and I because he knows how to angle his shoulder and swivel his hips in whatever way that lets him do it that you and I can't investing is behavioral so there's no there's very like what really matters is like can you leave it alone do you have the patience to leave it alone do you have the fortitude to endure the volatility it's pure behavioral it's not a technical thing to do so I think whenever the Endeavor is technical you need to try harder when it's behavioral you need to try less why I think in many ways relationships are behavioral as well and if you wake up every morning you're like I need to make a list of all the ways that I can become a better boyfriend a better husband like you're probably trying too hard it's probably just a behavioral just like can we just focus on like respect admiration like very simple behavioral things that are actually going to move the needle not like a list of the best presents that my wife is going to want for Christmas that's trying too hard why are we so seduced by complexity what makes it so attractive to us I think very often it's the only signal that the other the person who's trying to help you the consultant the financial adviser knows what they're doing and every like it's very clear in investing in finance that simple works like lowcost Index Fund Buy and Hold It works but you as a financial adviser you can't make a living saying that you can't charge people a high fee for doing that if you charge a high fee that you need to do to run your business you have to be able to say here's this black box that I created and it's worth the fee because it's so complicated and this is why I think a lot of people in finance 2 use jargon that's completely unnecessary and a lot of academics use jargon that's completely unnecessary because Simplicity is so synonymous in people's heads with you don't what you're talking about um and it's pretty rare that you have someone like Warren Buffett let's say who talks very simply is very simple and when he explains what he does and is and is crazy successful as well it's usually like the lawyer the financial adviser us sometimes the doctor is uh and I think it's innocent they're not they're not you know trying to pull the wool of your eyes it's an innocent way that they're doing it but they're trying to justify their education their intelligence and their fee with complexity yeah simpleness is indistinguishable from cluelessness it's very rare that you would have a Healthcare company that it's like why don't you eat some vegetables and go for a run like they want to make it more complicated and sometimes a complexity is necessary I'm not saying it's it's always bad but the difference between giving advice that is good and works and running an advice business can be a mile apart things that you don't understand create a Mystique around people who do understand it as well yes if I convince you that I know something that is so complicated that you can't even understand a single word of it you're going to look at me or look at whoever it is and be like oh my God you hear all the words he said all those acronyms I experienced this firstand many years ago when a family member of mine I accompanied her to uh a meeting with her financial adviser and this family member does not have a background in finance and she sits down and the financial adviser I'm sitting with her and the financial adviser mentions something about the yield curve and this family member just nodded her head and moved along and I'm remember thinking to myself she does not know what the yield curve is she has no clue what the yield curve is they no fault of her own it's not a simple topic but the financial adviser I think maybe innocently too you you know probably thought to himself like if I talk about the yield curve I'll look really smart like I know what I'm talking about even if the person on the other end but the person on the other end is like oh he said something I don't know that's why I pay this guy he knows things that I don't and so it's like an intentional confusion it's that reliable signal of effort as well that we were talking about before it's the person whose slack response time is always under 15 minutes who happens to be online at 3: in the morning who always get the but that's not always the highest point of contribution and in fact it can get in the way of being the highest point of contribution yeah I mean if you let's say you have like a a lump in your body and you're like oh this might be cancer and you go in and get it x-ray get an m whatever and the radiologist goes he's slacking his chair and he looks at the X-ray and he goes you're fine get out of here do you trust that guy I think what you want is someone who's gon to spend an hour like with all of his tools measuring things to make it look like you really put some effort into this so like very often effort is the only measurement that we have complexity is the only e measurement that we have to say like this person knows what they're doing wounds heal scars last what have you experienced that I haven't that makes you believe what you do and what would I think about the world like you do if I experienced what you have I think it's so often in finance and politics and a lot of areas in life where people who are debating a topic uh about what you should do with your money or who's the best politician they're not actually debating they're people with different risk tolerances different time Horizons different experiences talking over each other so if you say making this up Tesla is a good investment and I say no it's not we might not actually be debating with each other it might be that you have AER higher risk tolerance than I do and so I think when you realize that like we're all just mirrors of the experiences that we've had in life and I've experienced something very differently than you have even if we're both white men roughly the same age you grew up in the UK I grew up in California I experienced that you didn't and vice versa and even if we're very similar in so many regards you know things about how the world works that I don't and I and vice versa and it's true for every single person and so like the idea that um if I I think it's a really good question to ask who would I be and what would I believe if I were born to different parents if I was born in a different generation if I was born in a different country and it's impossible to answer those questions you don't know for any Precision but it's important to realize that if you were not born where when and to whom you were actually born to you would be a completely an utterly different person and you see this a lot um I mean one thing that's really interesting is that uh the German stock market um has actually performed like very well since since you know since the end of World War II it's actually done very well but a lot of German investors want absolutely nothing to do with it um and and you compare that to American investors who are like stocks stocks stocks it's like they they they they can't get enough of the stock market and a lot of why that is is because well what happened to the German stock market in the 1940s when to zero you got completely wiped out and the people's grandparents or their parents who experienced that like that left a social scar that was even passed down through the generations so if you look at a German investor compared to an American investor you might be like man the American investor is like man they're all in this like these guys are gunning for it and they're going to become rich and you guys are hanging out in bonds like what are you doing it's just because they experienced something that you didn't in vice versa another example Australia before covid went almost 30 years with no recessions like a full generation never experiencing any economic decline a lot of that was because China had so much demand for like the iron ore that they were digging up but because of that in the United States during that period we had three recessions two of which were like devastating and reshaped Society so two an American a recession was a very real thing to an Australian it was like a theoretical possibility and the Australians of course are just as smart as us they have the same textbooks the same data but they viewed economic risk completely differently than we did and I think you could say in that moment were the Australians oblivious to recession risk or are Americans overly paranoid about it there's no one right answer all you can say is like we've experienced very different worlds we have very different takes on life what's the difference between wounds and sculls uh I think a lot of it is wounds heal in the I I made this analogy of like if you go to uh the Pentagon in Washington DC there is no sign of September 11th of the plane that hit the building they rebuilt it there's a single scar of it anywhere but if you go to Reagan Airport one mile away the the wounds oh pardon me the scars of 9911 are everywhere take off your shoes take your toothpaste out of your bag take your belt off going through security all of that is a a scar from 911 so a lot of times like the physical damage of a recession or a pandemic or whatever it is like heals very quickly um but the psychological trauma is going to leave a scar forever you saw this at the end of World War II like Europe was rebuilt very quickly the physical scars of the war were gone in 20 years or so but the psychological trauma of the people who experience that will never go away and this was measured in in children who grew up in Germany and the UK and France during World War II what was the psychological trauma that stayed with them through adults was very measurable compared to the children who didn't let's say in the United States where they there was not physical destruction so even if the physical destruction is rebuilt the scars last forever and I think it's just the acknowledgement that we all have scars in one way or another from what we've experienced in life and my scars are very different from yours I had a conversation with a historian of existential risk so he was looking at how scientific knowledge had progressed over time and how Humanity's awareness of our ability to go extinct through or not through our own hands developed and he taught me this term called conceptual inertia which is um you even bring it up in same as ever where you say uh there are murmurings amongst some of the scientists that maybe the Earth isn't at the center of the solar system but most of them are a little bit scared to do it but even after it was proven and accepted and people were stopped being burned at the stake by the church for suggesting that this was the case it still took like two generations AC for that to actually Infuse into the scientific discourse why well because of conceptual inertia because assumptions about the world move very slowly MH culture is able to sort of adapt quite quickly but when it's a foundational thing it takes a very long time you almost have to wait for the generation who who expected it to die yes and it's it's the constant it's like the the max plank quote like science does not progress by new discoveries it progresses when the old generation who used to believe something eventually dies and the new generation who didn't come up with the old Dogma is now in charge you tweeted a little while ago that there are 13 divorces among the 10 richest men in the world seven of the top 10 have been divorced at least once what's the lesson to learn from that one it's a very small sample size this is not like you know like hardcore statistics but a variable that is so important to your lifetime happiness like whether or not you get divorced among a group of people who are so admired by Society oh I wish I could be one of the richest people in the world is always been so fascinating to me and to me this is just like the scene versus is the Unseen or what you're paying attention to when you look at one of the richest men in the world you look at their net worth and you fantasize about what it would be like to have that much money to have planes and Yachts and mansions what you don't see for a lot of those people and like it's it's it's too firm to say this is pure cause and effect but a lot of those people were so focused on their career a singular Focus for their entire life seven days a week for decades on end of of of of attention on their business that came purely directly at the cost of their personal life the relationship ship with their spouses with their children with their friends whoever it would be and so this is another of like careful what you wish for and that there's a cost of everything that's so easy to ignore the most valuable personal finance asset is not needing to impress anyone I mean so much of spending in our society after basic needs are met and after things that actually impact you are are met is spending money to show other people how much money that you have most of whom are strangers who are not even paying attention to you to begin with I heard this this structure that I thought was so good it was a high-end Toyota is a nicer car than an entry-level BMW yep or you could also say a sweet at the Hyatt is a nicer room than a basic room at the Four Seasons there's various ways that you could spin this and I think a lot of what it is is the highend Toyota is filled with things that are good for you comfy seats good sound system moonroof whatever it is the entry-level BMW is purely bragging rights you're paying for the emblem that's all you're paying for to show other people like look at me look great I am if you can just dispose of that in your life with the need to impress strangers outside of your core family friends co-workers whoever it might be who like want you to be a good person if you can dispose of that I think that is a financial asset on your balance sheet that could literally be worth millions of dollars to you just just lacking the need to impress strangers I think that there is a genetic set point for materialism everything's genetically heritable from our parents around about 50% of everything we are psychologically is is inherited from our parents and whatever combination of the hexico Big Five personality traits contribute to materialism Keeping Up With the Jones is how much do I believe that love is shown through gifts how much do I think that it's important for me to give and receive gifts etc etc um and I would 100% agree with you that the people for whom your next book is written and the people for whom die with zero by Bill Perkins is is written yeah in many ways have different challenges that they need to get over scarcity mindset and a concern and a discomfort about upgrading spending with their lifestyle and and and a fear about getting it wrong and all the rest of it but you can also see it as a huge competitive Advantage because the total amount of money that you need to meet the standard of living that you want to I'll never forget this dude one of the early podcasts I did with Yousef and Johnny and we were talking I'd love to bring this back up to them because their business is like 30 times bigger than it was back then or something like that they're making way way way way way more money and uh I remember one of the guys talking about like some arbitrary number like you know after uh 150 Grand a year like I don't really know what like what do I do with that like what am I going to do buy a nicer coffee and it was that sentence what am I going to do buy a nice of coffee yeah that's good just really hit it home and I was like well what you're doing is and we talked about this last night and you're also talking about it with the with the BMW thing the difference between flying coach and flying business is [ __ ] massive yes it's absolutely G it is double the cost maybe if you book it in advance something five times nicer on an international flight no comparison but the difference between business and first is maybe another two or three times Bragg the cost but yeah it's the fact that in business people have to walk past you to get to economy in first you don't even see them that's what you're going to pay $5,000 for i' I got to tell you this so Michael E's most recent book The scarcity mindset the scarcity effect did you see that thing in there where uh planes in which the people going to economy have to walk through business have a nine times increase in passenger uh like complaints and argumentation it's such a distinct like they call it like the the the the poverty parade of like when coach has like walked past and I think I think there there there there's some comedian I forget who it was but like uh it's like when when the people are walking past People In First Class the first class people are like man sucks you couldn't have worked harder you could have been sitting up here and it's like yeah it's such like a like a pure stratification of in society I had this interesting realization recent too my father-in-law my wife's father grew up in abject poverty he was homeless for some part of his childhood and then became a very successful businessman when my wife was 17 and thinking about going to college her dad who was by then a successful businessman said pick the most expensive school you can find and to him it didn't matter about the education What mattered was showing himself what he had overcome in life that to him going from homeless to being able to send his daughter to whatever the most expensive School in the country was he didn't know what it was he didn't care what it was that to him meant so much to him as a s symbol of what he had overcome it's the and I think a lot of spending is like that it's a symbol to your yourself of like I used to be this but now I'm this yeah well I think that's you know apart from the people who genuinely adore watches that's what a lot of watches are to people it it is a very ostentatious display of signal it's just a a super super strong signal um talb and I think you resurfaced this talb quote the world is split between those who don't know how to start making money and those who don't know when to stop so good phenomenal framing but I think that there is an equivalent twist when it comes to people who do personal growth the world is split between people who don't know how to change their lives and the people who don't know when to stop know to stop they applies to so many things yeah um what was I going to say I had a good one I'll teed up valuable first uh personal finance asset is not needing to impress anyone no I had a great spending thing that I was GNA say anyways Morgan I appreciate the hell out of you man this is episode number five or six or something it's honestly I said it on the first episode people need to go and buy same as ever I love it as a book I think it's phenomenal it's super easy read you know it's what's the audible 7 hours 6 hours something like that less four and a half or five four and a half five hours super easy read chunked up into individual uh chapters we've gone through loads of the stuff today there's tons more stories everyone needs to go and collect that and where can they go where else can they keep up to date with the stuff you do most of where I am is is Twitter I'm always going to call it Twitter never X most of where I am is Twitter my handles first and last name Morgan hle hell yeah Morgan I appreciate you thanks Chris if you enjoyed that episode then press here for a selection of the best clips from the podcast over the last few weeks and don't forget to subscribe