Hard, Boring, Long

The world is complex, random, and ambiguous. I like it where there is a process I can repeat with things I know that work, and will stay the same. I am not afraid of hard. What gets me down is wasted time. Fake work and indecision. 

When I have faith that I can just chip away at something, the disempowering anxiety that comes with “not knowing what to do” calms down. 

One of my passions is language learning. I can still only really speak English, but I am following the process of Fluent Forever (Gabriel Wyner) to train my ear and mouth muscles on lots of different languages. Not an easy task. What I like is that in 10 years, 20 years, 30 years, it is unlikely that there aren’t going to be people who speak those languages. The effort will have been worth it. 

There are certain difficult things you can put the effort in on, where the unknowns are limited. One of the best competitive advantages is choosing things that are hard (in very simple effort terms), boring, or take a lot of time. Language learning is a great example. Breaking out of our mother tongue is incredibly challenging... yet lots of people do it. 

There are advantages that even if you do in the open, and tell people how to do what you are doing, it will take time and application for others to catch up. “People tend to overestimate what they can achieve in a year, and underestimate what they can achieve in a decade”. 

Long-term plans you have to chip away at can be significantly more sustainable than quick wins that burn bright and fade out.

Adding Time

Slow but Effective

Desire for quick fixes, makes facing intimidating mountains a good barrier to entry (once you are on the other side). 

Exams can provide this barrier. Being good at something, is not the same thing as being able to explain (or even know) why you are good at something. Being good at exams is different from knowing the content. Exams impose artificial constraints. Time limits and the interpretation of markers. 

Reality normally lets you use google, maps, or GPS. “Only when the tide goes out do you discover who's been swimming naked” is Warren Buffett’s reminder that difficulty is revealing. 

Exam “match fitness” is the ability to deliver under constraints if questions go off the beaten path. 

If you have surface-level knowledge, you can pass tests, if nothing goes wrong. If the right questions are asked. That can develop confidence as you know a single path to success.

Embodied knowledge lets you understand the broader context. It is more sustainable. Which is why challenge allows deeper soaking. Basic processes can let you build that depth. 

The yoga I practice will be the same in 30 years. In 100 years. It is not variety it is teaching. Lots of people will find it boring, preferring postures that change. This style focuses on 12 basic postures, but those who go deep will develop the flexibility to deal with variations. 

No quick fixes, but a process that works.

Sani Pass

Diving to Understand

Merit is only one factor in wealth creation. Like risk and return, it is also not something you can simply reduce to a number for comparison and ranking. Like risk and return, it should come with the standard regulatory disclosure, “past performance is no guarantee of future success”. To “see Merit”, you need to look. What we see, unfortunately, depends on what we have seen. We understand by deep soaking. Through repetition, context, and recognition. Through networks of connecting dots that build a picture we can make sense of. To see Merit, you need to do more than just superficial due diligence. You need to repeatedly ask questions about people, process, performance, philosophy, and what it means for you. Merit means nothing without a win-win relationship between the one that has merit, and those they interact with. To see merit, you need to do a deep dive due diligence, and we only have limited capacity to do that. Which means what we see is path dependent, and we often see what we want to see. Looking to confirm that we are on the right path. What we see is not all there is.

"My Octopus Teacher"

Diving to Understand

Finding Your Daisy

If you want to solve a Rubik’s Cube, the first step is to find a daisy. The Rubik’s Cube itself has 43 quintillion combinations (20 digits) and no idea what a daisy is. A daisy is simply a first step of a model of something incredibly complicated. To make sense of things that are too complicated for us, we have to create a picture of the world. Something imperfect to help us narrow down the choices. Once you have a daisy, you can line the white petals up with the centre piece of the same colour and pick them off (rotate them all the way around). That will give you a white cross. Then you put the corner piece (two colours plus white) directly above where you want it with the white cross facing down. Repeat a “righty” (Move the right side forward, top forward, right back, top back) till the piece is correctly positioned. That’s step one. The bottom row. The cube seems complicated, but pop on Zoom with me for an hour or two (or search YouTube) and you’ll crack it. The trick to most complicated problems is the first step. Finding the daisy. Finding your daisy.

Degrading Categories

I hate feeling incompetent. Almost as much as I hate the feeling of having gotten it wrong by someone. In a way that I can’t correct. Intellectually I get the idea of the importance of not caring what other people think. But I do care. And people, all people, have limits to their skills and knowledge. Money lets you hide it somewhat. You can pay people to do the things you can’t do. You can even convince yourself that that is because your time is worth more than theirs. That the thing you specialise in is more important than the thing they do. Particularly if it pays more. So, paying them to do the thing you can’t do is protecting your time. You can even convince yourself that you could do the thing they do, if you chose to. Underlying a lot of problematic prejudice is a fundamental belief in superiority. Dividing people into binary categories of “good enough” and “not good enough”. Second class citizens. Surrounding yourself with people you feel are good enough. Not doing the work to see the others. Underlying that is probably the internal voice telling you you aren’t good enough. The voice that is secretly aware of all the things you can’t do.

Build to Build

I don’t agree that there is a trade-off between risk and return. You don’t make money by taking risks (unless you are an Insurance Company). Risk management is simply an acknowledgement that the world is complicated, ambiguous, and random. The future is surprising. Investment Returns come, not from being able to predict the future, but from creating value over long periods of time. You create value through the application of skills and knowledge. Uncertainty means it isn’t 100% clear what skills and knowledge you need to develop, and what problems will need to be solved. I like knowing my effort won’t go to waste. I don’t mind working hard. I do mind working pointlessly. I prefer evidence to faith, unless the process itself is something I am okay with. If the value is the process. Otherwise, I want to see the value first. Understand what needs doing. Why it works. What I need to learn to do it. The world changes, but there is a lot of evidence of skills and knowledge that add value. Build those for yourself, so you can build for others.

"The Sower" Vincent Van Gogh

Staying Connected

The only thing we can be certain of, is that things won’t go according to plan. We can plan for, not going according to plan. Time matters, if in each moment we are doing something that matters to us. If today matters. If we are connecting the moments. Backwards and Forwards. There is a temptation to weight time differently. To release the past. To discount the future. To focus on now alone. That is not my approach. I love my story. Revisiting my story. It provides context to the habits, loops, scripts, drivers, responses and incentives that create the way I see the world. With attentive feedback and reflection, that rewire the way I will see the world. The way I will interact with others. I value my future. The future of the others who will follow. The connection I will have to their story. What we can plan for, is our ability to endure. Our ability to cope. To adapt, adjust, and accommodate the uncertainty. Plans don’t have to be about control. Plans can start with acceptance and investment in capacity. They can start with a deep breath. Then move forward while staying connected.

Natural Stock Keeping

Investing is unavoidably philosophical. It is challenging to build up evidence when there is so much noise. A choice between too short for the noise to wash out, and so long that the evidence is stale. A single decision, whether right or wrong, large or small, is almost irrelevant in the very long run. It is the process that matters. “Time in the market, rather than timing the market”. An individual career (15-40 years) barely lets proper compounding kick in. Real wealth is created across generations, within communities, through institution building. My philosophy has shifted towards that of my father-in-law’s approach to Natural Bee Keeping, and a friend working on re-Wilding in farming. Focusing on Endurance and Resilience. Letting the Bees, Nature and Businesses do the work. A single decision that ends things does matter, so the focus needs to be on Custodianship. Keep breathing. Keep moving. Keep creating. Sustainable Growth is the pumping heart that keeps the cycle of creation and reinvestment going.

Damage Shows Strength

Survivorship Bias is our tendency to see the people who made it through some selection process, without seeing those that did not (even if the reason was luck). We study the stories of success like people studying that the roulette ball landed on black rather than red. It is too hard to get a good picture of each important fork in the road, and what could have happened. You can’t study what ifs without a solid imagination. I am a bigger believer in focusing on the foundations. Creativity isn’t a path, it is a process. For that process to work, you need endurance and resilience. Creativity isn’t picturing a world you want and building it. It is building the strength, flexibility and control to make your way through a world that is complex, ambiguous, and random. Those foundations include kindness and respect. Not earned by being a story of success. Earned by a commitment to show up. Today, and every day.

The damaged planes were the ones that returned safely

The others didn't survive.

Internal Balance

To gain balance, you need to fix your eye on something that is stable. Something permanent. Then to internalise that stability so you can close your eyes, and still keep focus.  If your performance measure is more, or relative, then you are going to wobble. If your goal is to beat a Benchmark, then you can still “do well” when you lose. If you lose less. That can’t be the point. The best investors I know are process focused. This is true of Capital creation in the same way it is true of any form of mastery. The world is complex, ambiguous, and random. Worthy performance measures have to be internal. They have to be able to look at the fundamentals. What is really going on? What is really being built? Why? If your measures are about winning and losing, about relative success, then don’t be surprised when you blink and the flame you were looking at moves.

Powering Dreams

The first Industrial Revolution introduced machines. The second changed the way we do things, to best make use of those machines. The third shifted machines from mechanical to digital. The fourth will again change the way we use things and do things. All these huge turning points affected both our daily lives and the way we identify ourselves. Real empowerment isn’t us being scared of, and so avoiding, being replaced by machines. Real empowerment is us pausing to reflect on what we want our daily lives to look like. How we want to identify ourselves. Then being in a position to choose. Living hand-to-mouth and tying our identity to our labour makes us a cog in the machine. The real Revolution is realising we sit above that. That we can consciously build Engines to power our dreams.

Powerloom Weaving in 1835