Thursday, May 28, 2020

Drip Feeding

Lots of people are paid substantial incomes but are not financially independent. You can make £100,000 a year a still be as addicted to income as someone earning R100,000 a year. Spending adjusts as fast (if not faster, given increased ability to borrow) as income. It is super tempting to spend your income even before you have earned it (borrow and spend). Living off a Basic Income paid by an Engine requires substantial internal discipline. Unlike a salary which drip feeds you, an Engine is there. It has a paper value. You can fire it by selling it off and spending it. Particularly challenging is the Alternative Worlds presented by friends who have chosen different paths. You can’t see the Engine. It is working. You can see an income you spend, in the lifestyle it affords. Part of shifting to a Buffer & Engine mindset, and weaning ourselves off income-dependence requires an ability to move beyond drip-feeding.

Disaster Management

Business Continuity Planning (BCP) is part of the risk management of companies built for endurance and resilience. It involves brainstorming and preparing for any threats, and setting up plans for before, during, and after disasters. You often get accountants who get their own finances in a mess. Actuaries who don’t have adequate insurance. Handymen whose own house is falling apart. Therapists who don’t look after their own mental health. The problem with 5 days a week of work, and only 28 days of leave a year, is getting your own house in order. A key part of BCP is key man risk. A good company shouldn’t be dependent on any individual. Unfortunately, lots of individuals are very dependent on the companies they work for. And more energy goes into thinking about the threats to the business than the threats of depending on that business. No sustainably good business would have just one client, or just one employee. Yet we structure society on individuals depending on a single stream of income.

Wednesday, May 27, 2020

Elite Team

If you want to be part of an Elite Team, you first have to accept the idea that there are people that aren’t good enough. You have to accept the possibility that you aren’t good enough. That there is someone who deserves your spot more than you. If you push the idea of Meritocracy to its extreme, and believe in surrounding yourself with the best, you need to be consistent. You need to listen to that voice in your head that asks if you are good enough. The impostor syndrome that makes you feel inadequate. That means you have never reached the goal. Elite Teams aren’t about the individuals. They are about the Team. They require sharp knives. Personally, I don’t want to be part of an Elite Team. I don’t care if you think I am enough. I don’t find the question of whether you are enough interesting. What interests me is your incentives. Your passions. The way you create meaning. What interests me is the way you connect to others. What you do every day. That is enough.

Are you the best?

Double Standards

Consistency is a great thinking tool. If you believe “A” and “not A”, you can’t believe them in the same room. I used to think you can’t be intelligent and racist. But then I read about Dr.Death. The cardiologist and former head of Apartheid South Africa’s chemical and biological warfare project. You can believe contradictory things if you switch off part of your brain. That is why Double Standards grate me so much. Business can encourage a brutal offswitch for seeing people as people. It can encourage “tough decisions” that impact people more than the business. Often those standards don’t work both ways. You don’t see people higher up the chain of command falling on their swords. When the numbers support the argument, they are used. When the numbers don’t support their argument, the Defence Attorney and Public Relations Officer replace the Scientist at the Q&A session. The business becomes a church. The danger with numbers, is there are always other numbers.

Tuesday, May 26, 2020

In Context

I don’t’ write Blank Cheques. Every decision has trade-offs. Having been born into Apartheid South Africa, I don’t subscribe to the philosophy of abundance. Scarcity is real. This means you can want something, but still not get it, because the price is too high. Everything, has a price that is too high. That doesn’t mean you don’t value “the thing”. That you don’t see the value. That you don’t have the desire. In isolation, every story can be incredibly powerful. But to understand something you have to understand the constraints. You have to understand the context. You have to mitigate for unintended consequences. No single decision stands alone. Unless it is literally the only thing that matters to you.

Worth It

How will you feel in the morning? How will you feel on Monday? I like to buy Democratic Goods. Those where the price is low enough that everyone who wants them can mostly afford them. Dividends of being Cultural Billionaires, sharing in societies compounded cumulative skills and knowledge. Price is relative. Just because the price is high tells you very little about its relationship to value. But a low absolute price does reduce the amount of Due Diligence you need to do. The bigger the number and the less you know, the more research is required. The bigger the number, the fewer other people (also researching) are likely also buying. Bigger number, smaller market. In tiny markets, the story becomes more important. It becomes easier for there to be different knowledge on the part of the buyer and seller, and smoke and mirrors in between. The bigger the absolute price, the more dangerous the epiphany, “I am worth it”. Of course, you are worth it. That doesn’t mean people won’t try sell you a story to get a chunk of that worth. “Is everyone else worth it too?” is a good follow up question.

Is everyone else worth it too?

Monday, May 25, 2020

Petty Dictator

It becomes gradually harder to accept things you don’t like, as you become more empowered to not have to accept them. Having no option but to carry on forces you to suck it up. We live in an income dependent world. Nothing kills an activist like a mortgage and school fees. Obligations that override competing desires. 30-year mortgages lay some pretty clear constraints around your options. I don’t like hierarchy without enthusiastic consent. I don’t like Petty Dictators.  I don’t like having to follow instructions because there is no option to walk. No agency. Particularly when the person issuing the instruction knows that. Teams work significantly better when there is genuine respect. At a human level, when the engagement is relational rather than transactional. When there is a sense of Peers who recognise each other’s competence and goals, and are supporting each other. In an income dependent world, Capital empowers you to say “No”. To work with people rather than just do what you are told.

STEM Engine

What are you counting? I have always had a love for both Art and Maths. In deciding on a career, I chose to be pragmatic. The harsh reality is STEM (Science, Technology, Engineering and Mathematics) subjects are more efficient money-making containers. Money making requires something you can count. If you can’t count it, you can’t measure it. If you can’t measure it, you can’t manage it. If you can’t manage it, you can’t control it. If you can’t control it, you can’t make money from it. It is a fundamental misunderstanding of pricing to think qualitative subjects don’t add the value of quantitative subjects. Price isn’t value. It just reduces the complex down to a tool for comparison. It creates a market that allows Due Diligence (alternatives, reliability, fairness). This doesn’t mean we have to live in a STEM world. It does mean that STEM Engines are more reliable. It is far easier to use Maths to make money, and free your Art from the constraints of supply and demand. Build an Engine you can count on, for the things that count.