Monday Happens

Behaviours get embodied. When we respond in a certain way for years, we can cease to be aware. Our minds and bodies are ruthlessly focused. 

If you do press-ups, they will progressively get easier. If you aren’t exercising, then you go for a run... you will be sore, because you have told your body those muscles don’t matter. 

Regularity allows deep soaking. If you learn superficially, then the knowledge can disappear. Explaining or teaching is one method to allow you to constantly re-engage and not forget the steps. 

"The Curse of Knowledge" is when we forget what it is like not to know. 

If the steps suddenly stop working, it can be hard to fix the problem if you have been on automatic pilot. 

In Jonathan Haidt’s analogy, the elephant is in charge even if the rider looks like they are holding the reins. 

The elephant is our habits. The rider is our perspective of the decision-making. The rider can point, and even believe they are in control, until the elephant wants to do something else. 

You can train your elephant, but it takes work, consistency, and time. I believe in Free Will. But it is incredibly hard. You don’t just have life-changing epiphanies in a weekend away, or by reading an article online. 

Monday happens. Repeatedly. Do the work to create the meaning you want. Invest in the resilience and endurance needed to hold space for you to create.

Galileo's 1616 drawing

of the phases of the moon

Long Term

Although investing is a long-term game, our working careers are short. 5 years is not a long time. Even 15 years is only just long enough for compounding to start hinting at its magic. In “The Psychology of Money”, Morgan Housel points out that Warren Buffetts' biggest weapon was that he started investing at age 10, and has kept at it without quitting for 80 years and counting. At the time of writing the book, Buffett’s net worth was $84.5 Billion, of which $81.5 Billion had been made since his 65th birthday. Housel’s rough estimate of the size of Buffett’s Engine if he had started at 30 (after enjoying his 20s/setting up home), and stopped at 60 to golf, is $11.9 million. That is a big Engine. But no one would know who he is. 80 years is the number that really matters... and all the small numbers that contributed to the foundation years are the only reason the glory years exist. Merit applied to nothing doesn’t get seen. Conspicuous Merit always builds on deep history. 

Time measured in Ice Ages

 

Sparkling Inequality

Most people I know plan their finances in a bubble. Bryan Caplan points out that “normal people say what other people do, but do what other people do”. This is where the concept of Champagne Socialism comes in. When there is a stark disconnect between spoken politics and lifestyle. Consistency is ridiculously challenging. It can be paralysing because the task is tall. If you believe the world needs to consume less (climate change), the median GDP is roughly $10,000. I am not saying that number is a perfect measure, but if you believe we should consume less, do you believe you should not consume (personally) more than USD 10,000 a year? My friend Galeo talks of being a Half-Hearted Fanatic. Martyr’s do not survive. The median adult income in the UK is roughly $24,000 (adjusting for prices), and in South Africa it is about $4,750. If we are all aiming to consume sustainably, how do we nudge towards that goal? Our bubbles bump each other in our bigger bubble.

Engine and Vehicle

Don’t put good ideas on a pedestal. A good idea is just an intended destination. To get there, you need an Engine (Capital) and a Vehicle (Container). Fundamental Investing recognises that just because something is a good idea doesn’t mean it will be a good investment. A strong company needs a strong Balance Sheet and control of their Cash Flows. Meaning they need to be both solvent and liquid. To survive the long term, their assets need to be worth more than their liabilities. To survive the short term, their liquid assets (easily available) need to be more than their immediate obligations (payable now). A company with assets that are theoretically valuable may be forced to sell them for far less than they are worth if they have short term obligations that are impatient. The same is true for individuals as is true for good businesses. What you do, isn’t the only thing that matters. Your Engine matters. Your Vehicle matters. Step back. It isn’t just activity that counts. Work on the foundations and the environment in which you create meaning. Create space. Create time. Then create.

Good Ideas need Engines and Vehicles

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.

Sustainable and Consistent

Competitive advantages are hard to sustain. Sustainability rather than size is the important force. Opening to the magic of compounding. The most appealing ideas are those that hide in the open. Deep-soaked over time through consistent application. We all have a good idea of how to stay fit and eat healthily. Most of us don’t. Fad diets, massive weight loss, fast muscle gain etc. are not particularly impressive. The important part of a fast isn’t the fast. It is breaking the fast. Breaking it gently in a way that there is a fundamental shift. The fast may be the shock that brings attention, but it is the awareness and action that brings the long-term results. The same is true of building Capital. You can destroy a lot of things in a single day. To build something of value, more important than what you do on a particular day, is what you do every day. Sustainably.

The beauty of time and consistency - drip, drip, drip

Consistency

One of our strengths as humans is our ability to believe two things that can't both be true. If we become aware of the inconsistency, we will only change our mind/heart if the clash causes stress. If new evidence means we have to choose. If we don't have to choose, we are pretty good at parallel lives. Consistency makes communication easier. Agreement between two people is effectively a choice. If we don't want a new discussion every time, we need a rule. Rules need consistency. Like computers which think in 1s and 0s. It can't be both or you will get 'the blue screen of death'. It may be possible to have a world where the answer is 1, and a world where the answer is 0. Each of us live in our own little worlds. Our worlds bump into each other. Consistency is the way we smooth those bumps.