Open Architecture

Adam Smith’s big insight was that win-win (the wealth of nations) beats win-lose (nations fighting). Open-Architecture, breaking down walls, and opening roads, can be frightening in a world where wealth is built in containers. You can’t tell someone who isn’t relaxed to relax. They need to start feeling it in their bones. They need to breathe.

In pure-play meritocracy, only the best would win. In reality, we all need to eat. So friction allows us to talk our own book. There are 7.9 Billion people on the planet. Very few are “the best”. Particularly in the early stages of setting yourself up, while you are living hand-to-mouth, relaxing is a challenge.

If you don’t have the capital and confidence to believe you can adapt and adjust as problems change. Walls are built because of fear. As fear subsides you get a trust premium. You release all the wasted resources we put into worrying, guarding, fighting, and defending. 

Berlin

Source of Power

The reason I talk of “building an Engine” rather than saving/investing/capital is because I am a fundamental investor. I believe what you do matters. Wealth creation is not a win-lose tussle to prove how clever you are. It benefits you if others also succeed. I believe long term wealth is created by solving problems for the whole value delivery chain. “A species can only thrive when everything else around it thrives too” points out David Attenborough. It is not an accident that it is easier to make money in rich countries, or if you are randomly born into a rich community. An Engine powers things that don’t necessarily power themselves. Not all good ideas are good business ideas. Equally, some great ideas only happen if they find the money. If they have an Engine. To power good ideas, Engines need to work. Building Engines can set your good ideas free, beyond the narrow constraints of supply and demand that contain money making ideas.

Source of Power

 

New World. Old Vines.

 “If South Africa wins, we all win”. Ian Naude was responding to a question about whether he supports young, up-and-coming, winemakers or sees them as competition. Wealth is made in containers around supply and demand, and the temptation is to forget that we exist in bigger containers. Wine containers. South African containers. Global containers. In “The Art of Learning”, Josh Waitzkin talks of a martial arts teacher of his who was very open with what he knew. His belief was that if other people were obsessing over what he was doing, that was to his advantage anyway. The great insight of Adam Smith was that win-win beats the gunboat approach of mercantilism every time. All containers provide is shape and form to our problem solving. They make for clear asks and clear offers. They are a communication tool, but they don’t have to define or separate us, or our learning. Secrecy is lose-lose. Grow the bigger container and we all win.

craft wines that tell a story

I am not Playing

I don’t like the term “playing the markets”, but even I have to admit that it is possible to hype it up and play it as a game. Throw in some American Football Style commentary and every bump and drop can be dramatized. It is true that you can trade anything with a pulse. It is also true, that while some people believe it is 50/50 whether an active investor making conscious decisions can beat the market (pre fees), it is far far easier to lose money than it is to make money. It is incredibly easy to make stupid decisions and lose money fast. The equivalent of going on tilt in poker. Which normally means trying too hard to make money too fast. That is “playing the markets”. The best way to play that game is to be patient, and avoid being stupid. Feed off the mistakes of others. Investing is different. Investing is slow. Investing is getting your money a job, and reinvesting its salary rather than spending it. Investing is the win-win daily practice of creating mutually positive futures. Investing is channeling resources to the solving of problems.

Investing isn't Win-Lose

Showing Apples

Wealth Compounds. Even if you start from what seems like scratch, but isn’t. That is because despite the valuable notion of Private Property, wealth creation is a team sport. The best part of being human is we can learn from other people’s successes and failures. We don’t have to invent the wheel ourselves if we do the required reading. There is a scene in Good Will Hunting where a know-it-all tries to embarrass people he feels superior to. Will had done the reading, and showed the guy some apples. Meaning he taught him some best practice. A better way to live. One of the biggest lessons from history is progress doesn’t have to be Win-Lose. Countries like Singapore and the Asian Tigers have leapfrogged the middle steps. England, Germany, France and Japan all rebuilt after being torn apart by the World Wars. With conscious, direct, practical steps. Removing barriers to trade and prosperity is possible. It has been done before. We can let go of the mistakes and apply the learnings. We can open up.

Find a better way