Difficult Questions

We do not all have the same skills and knowledge. We do not all have the same barriers to entry. We have different opportunities. We have different sources of funding. We are consuming resources unsustainably, yet the average global GDP is only about $11,500 per person. Can you live on $11,500 a year and still create space to save?

If you are earning more than that, can you reduce your consumption to that level? Yet, there is a whole swathe of the world’s population living in poverty. How do we raise people out of poverty, when we can’t all consume the amount that is being consumed by those who are consuming too much?

How do we incentivize if consuming more is not an option? How do you get someone out of bed in the morning, if you are asking them to have a worse day than yesterday? Every day?

These are difficult questions that require some fundamental reframing of how we make our decisions. 

Framing and Structure

Entry Ticket

You can think of risk as stress, and stress is not all bad. “Discomfort is the entry ticket to a meaningful life”. In exercise, you have High Impact Interval Training. Putting the body under stress in a controlled fashion can be a good thing. That is the way we learn. The body follows a use-it-or-lose-it strategy, and is ruthlessly efficient at redistributing its energy. If you start doing press-ups, your muscles will get bigger as your body responds. If you stop doing those press-ups, your muscles will get smaller. If you go for runs regularly, you will get faster and it will become more comfortable. If you stop running for a while, you start getting tired when you go for random, irregular runs. The body directs resources to where they are needed, and takes them away when they are not used. If you want to build up strength, you put your body under stress in a controlled fashion to build up your capacity for when you are in uncontrolled situations. Developing the strength and flexibility to maintain control when you are not in a planned environment. 

1930s Turnstile

 

I See You

Fundamental Investing is the “Sawubona” of investment philosophies. “I see you” is the aim. What you see is not all there is. A business is not just about an idea. It is about what gets done over a significant helping of time. Meritocracy is caveated by the ideas of competitive advantage and barriers to entry. Any idea, whatever its quality, requires Capital to protect it from the waves of chaos, and to feed its growth. Any idea, whatever its quality, exists in an ecosystem of stakeholders (regulators, suppliers, customers, competitors, employees, investors) that force its existence into constant existential evaluation. Resources are limited. We don’t get to do everything. There are tradeoffs. Fundamental Investing is about seeing the potential through the noise of the conspicuous. It is about looking at support structures. It is about doing due diligence on how something exists, not just that it exists.

compound eye of an antartic krill

 

Losing Focus

There is a conflict between the idea of “leave your ego at the door” and meritocracy. If we believe in a world where the quality of life you can live is determined by your “underlying permanent” skill and knowledge, then constant evaluation of an individual’s fundamental intrinsic worth makes sense. If you believe in Elite teams, then you need to be regularly dividing people into groups that are good enough, and not good enough. The justification for meritocracy is that all boats rise if resources are pushed to those who are the best. Not for spending. For reinvestment. Politics is bound to be brutal and closeted if you pretend to be gods. Ego gets left at the door when it is all hands on deck to find solutions. When someone is confident enough about their place that the focus is on the problems, not the person. If you are surrounded by naked emperors, the focus is likely to be on, smaller things.

Graffiti in Tartu

Wrestling with Ideas

A good idea is not enough. Bringing a thought to reality is a complex coordination problem that requires time, resources, and connection. I have wrestled long and hard with my inner idealist and pragmatist. Learning which battles to pick. Learning the art of silence. Learning when good intent actually escalates conflict. Learning when there is no need or value in defending myself or my beliefs. And when there is. I find it interesting that in stories of the old sages, the wise old hermits that get consulted seldom do more than ask ambiguous questions. As if those who know the most are those who see the humour in it all. In my utopia, my understanding of the world is not forced on others. I am an anarchist in that way. My ideal relationships are peer to peer. But I am not submissive, and am resistant to those who wish to dominate without consent. A dance between protecting my good ideas, and letting them go enough for them to influence reality.